A.B.N 58 081 688 164
2020
ANNUAL REPORT
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONTENTS
CORPORATE DIRECTORY
Directors’ Report
2
BOARD
Remuneration Report
Auditor’s Independence Declaration
Consolidated Statement of
Profit or Loss and
Other Comprehensive Income
8
14
15
Farooq Khan (Chairman and Managing Director)
(Executive Director)
(Non-Executive Director)
Victor Ho
Yaqoob Khan
COMPANY SECRETARY
Victor Ho
Consolidated Statement of
Financial Position
Consolidated Statement of
Changes in Equity
16
PRINCIPAL & REGISTERED OFFICE
Level 2, 31 Ventnor Avenue
West Perth, Western Australia 6005
17
Consolidated Statement of Cash Flows
18
Notes to the Consolidated Financial
19
Statements
Directors’ Declaration
Independent Auditor’s Report
Additional ASX Information
40
41
45
Telephone:
Facsimile:
Email:
Website:
(08) 9214 9777
(08) 9214 9701
info@queste.com.au
www.queste.com.au
AUDITORS
Rothsay Auditing
Chartered Accountants
Level 1, Lincoln House
4 Ventnor Avenue
West Perth, Western Australia 6005
Telephone:
Website:
(08) 9486 7094
www.rothsayresources.com.au
STOCK EXCHANGE
Australian Securities Exchange
Perth, Western Australia
ASX CODE
QUE
Queste’s 2020
Corporate Governance Statement
can be found at the following
URL on the Company’s website:
http://www.queste.com.au/corporate-governance
SHARE REGISTRY
Advanced Share Registry Limited
Main Office
110 Stirling Highway
Nedlands, Western Australia 6009
Visit www.queste.com.au for:
•
•
•
•
•
Market Announcements
Financial Reports
Corporate Governance
Forms
Email subscription
Local Telephone:
Telephone:
Facsimile:
Email:
Investor Web:
1300 113 258
(08) 9389 8033
(08) 6370 4203
admin@advancedshare.com.au
www.advancedshare.com.au
Sydney Office
Suite 8H, 325 Pitt Street
Sydney, New South Wales 2000
Telephone:
(02) 8096 3502
Investor Portal:
https://www.advancedshare.com.au/Investor-Login
ANNUAL REPORT | 1
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
The Directors present their report on Queste Communications Ltd ABN 58 081 688 164 (ASX:QUE) (Company or
QUE) and its controlled entities (Queste or the Consolidated Entity) for the financial year ended 30 June 2020
(Balance Date).
QUE is a public company limited by shares that is incorporated and domiciled in Western Australia and has been
listed on the Australian Securities Exchange (ASX) since November 1998. (ASX Code: QUE)
Queste’s results incorporate the results of controlled entity, ASX-listed investment company, Orion Equities Limited
ABN 77 000 742 843 (ASX:OEQ) (Orion or OEQ). The Company has a 59.86% (9,367,653 shares) shareholding
interest in Orion (30 June 2019: 59.86% (9,367,653 shares)).
PRINCIPAL ACTIVITIES
The principal activity of the Company during the financial year was the management of its assets.
The principal activities of controlled entity, Orion, during the financial year were the management of its investments,
including investments in listed and unlisted securities and real estate held for development and resale.
FINANCIAL POSITION
COMPANY
Cash and cash equivalents
Current investments - equities
Investment in controlled entity (OEQ)
Investment in Associate entity (BEL)
Receivables
Deferred tax assets
Other assets
Total Assets
Tax liabilities (current and deferred)
Loan from controlled entity
Other payables and liabilities
Net Assets
Issued capital
Reserves
Accumulated losses
Total Equity
OPERATING RESULTS
COMPANY
Total revenues
Net gain/(loss) on financial assets
Share of Associate entity’s profit/(loss)
Other Expenses
Profit/(Loss) before tax
Income tax expense
Profit/(Loss) for the year
2020
$
57,864
3
2019
$
36,672
3
374,706
1,124,118
-
96,261
523,632
5,893
-
15,970
523,632
40,222
1,058,359
1,740,617
-
(90,130)
(262,525)
-
-
(227,656)
705,704
1,512,961
6,239,370
2,347,229
6,239,370
2,347,229
(7,880,895)
(7,073,638)
705,704
1,512,961
2020
$
2019
$
61,299
182,773
(749,413)
(421,844)
-
-
(119,143)
(311,116)
(807,257)
(550,187)
-
-
(807,257)
(550,187)
ANNUAL REPORT | 2
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QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
EARNINGS PER SHARE
CONSOLIDATED ENTITY
Basic and diluted loss per share (cents)
2020
(1.96)
2019
(3.36)
Weighted average number of fully paid ordinary shares in the Company outstanding
during the year used in the calculation of basic and diluted earnings per share
27,072,332
27,072,332
DIVIDENDS
The Company’s Directors have not declared a dividend.
SECURITIES ON ISSUE
At the Balance Date (and currently), the Company had 27,072,332 listed fully paid ordinary shares (30 June 2019:
27,072,332 fully paid ordinary shares) on issue.
All such shares are listed on ASX. The Company does not have other securities on issue.
REVIEW OF OPERATIONS
1.
Orion Equities Limited (ASX:OEQ)
1.1. Current Status of Investment in Orion
Orion is an investment entity.
The Company holds 9,367,653 shares in Orion, being 59.86% of its issued ordinary share capital (2019:
9,367,653 shares and 59.86%). Orion has been recognised as a controlled entity and included as part of
the Queste’s results since 1 July 2002.
Queste shareholders are advised to refer to the 30 June 2020 Full Year Report and monthly NTA disclosures
lodged by Orion for further information about the status and affairs of the company.
Information concerning Orion may be viewed from its website: www.orionequities.com.au
Orion’s market announcements may also be viewed from the ASX website (www.asx.com.au) under ASX
code “OEQ”.
Sections 1.2 and 1.3 below contain information extracted from Orion’s public statements.
1.2. Orion’s Portfolio Details as at 30 June 2020
Asset Weighting
Australian equities
Property held for development and resale
Net tax liabilities (current-year and deferred tax assets/liabilities)
Net cash/other assets and provisions
TOTAL
% of Net Assets
2020
35%
62%
-
3%
2019
36%
43%
-
21%
100%
100%
ANNUAL REPORT | 3
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
Major Holdings in Securities Portfolio
Fair Value
$’million
% of Net
Assets
ASX
Code
0.72
0.45
40.48%
25.37%
BEL
SRK
1.17 65.85%
Industry
Sector
Exposures
Diversified
Materials
Equities
Bentley Capital Limited
Strike Resources Limited
TOTAL
1.3. Orion’s Assets
(a) Bentley Capital Limited (ASX:BEL)
Bentley is a listed investment company.
Queste holds 1.61% (1,225,752 shares) of Bentley’s issued ordinary share capital with Orion holding 26.95%
(20,513,783 shares) of Bentley’s issued ordinary share capital (2019: Queste held 1,225,752 shares (1.61%)
and Orion held 20,513,783 shares (26.95%)).
Bentley’s asset weighting as at 30 June 2020 was 99% Australian equities (2019: 98%) and <1% net
cash/other assets (2019: 2%).
Bentley had net assets of $5.21 million as at 30 June 2020 (2019: $6.35 million) and incurred an after-tax
net loss of $1.143 million for the financial year (2019: after-tax net loss of $2.458 million).
The share price of Bentley has increased significantly since the balance date, from 3.5 cents to a last bid
price of 6.4 cents (on 25 August 2020). Based on Orion’s 20,513,783 shareholding in Bentley, this represents
an appreciation in market value from $0.72 million to $1.31 million.
Shareholders are advised to refer to the 30 June 2020 Full Year Report and monthly NTA disclosures lodged
by Bentley for further information about the status and affairs of the company.
Information concerning Bentley may be viewed from its website: www.bel.com.au.
Bentley’s market announcements may also be viewed from the ASX website (www.asx.com.au) under ASX
code “BEL”.
(b)
Strike Resources Limited (ASX:SRK)
Strike Resources Limited is an ASX listed resource company which is developing the Paulsens East Iron Ore
Project in Western Australia. Strike also owns the Apurimac Magnetite Iron Ore Project and Cusco Magnetite
Iron Ore Project in Peru and a number of battery minerals related projects around the world, including the
Solaroz Lithium Brine Project in Argentina and the Burke Graphite Project in Queensland. The Paulsens East
Iron Ore Project (Strike 100%) is located in the Pilbara, Western Australia. Strike is completing a Feasibility
Study on the Paulsens East Iron Ore Project.1
As at 30 June 2020, Orion holds 10,000,000 Strike shares (4.83%) (2019: 10,000,000 shares; 6.88%) while
Associate entity, Bentley, holds 52,553,493 Strike shares (25.37%) (2019: 52,553,493 shares; 36.16%).
Therefore, Orion has a deemed relevant interest in 62,553,493 Strike shares (30.199%2) (2019: 62,553,493
shares; 43.04%).
1 Based on Strike’s ASX announcements, including:
• 9 April 2020: Revised Scoping Study for Utah Point, Port Hedland Supports Excellent Project Economics for Paulsens East
Iron Ore Project
• 4 September 2019: Significant Upgrade of JORC Mineral Resource into Indicated Category at Paulsens East Iron Ore
Project
2 Refer Orion’s ASX Announcement dated 5 June 2020: Change in Substantial Holding Notice in SRK
ANNUAL REPORT | 4
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
Orion and Bentley’s interest in Strike has diluted during the year as a consequence of equity capital raisings
undertaken by Strike:
•
•
On 18 July 2019, Strike raised $0.981 million through a placement of 21.8 million shares.
On 5 June 2020, Strike raised $1.8 million through a placement of 40 million shares.
Orion is also entitled to receive a royalty of 2% of gross revenues (exclusive of GST) from any commercial
exploitation of any minerals from the Paulsens East Iron Ore Project tenement (currently a Retention Licence
R47/7 but pending conversion to a Mining Lease M47/1583 ) owned by Strike Resources Limited (ASX:SRK).
This royalty entitlement stems from Orion’s sale of a portfolio of tenements (including the Paulsens East
tenement) to Strike in September 2005.3
Information concerning Strike may be viewed from its website: www.strikeresources.com.au.
Strike’s market announcements may also be viewed from the ASX website (www.asx.com.au) under ASX:
“SRK”.
(c) Other Assets
Orion owns a property held for redevelopment or sale but currently rented out located in Mandurah, Western
Australia.
2.
Queste’s Other Assets
In addition to the investment in controlled entity, Orion, Queste has a direct share investment in Associate
entity, Bentley, being 1,225,752 shares (or 1.61% of Bentley’s issued ordinary share capital) (2019:
1,225,752 shares and 1.61%).
The share price of Bentley has increased significantly since the balance date, from 3.5 cents to a last bid
price of 6.4 cents (on 25 August 2020) - this represents an appreciation in the market value of Queste’s
1,225,752 shareholding in Bentley from $43k to $78.5k.
The Company notes that it lodges Monthly Cash Flow Reports and Quarterly Activities and Cash Flow Reports on
ASX, which may be viewed and downloaded from the Company’s website: www.queste.com.au or the ASX website
(www.asx.com.au) under ASX Code: “QUE”.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of affairs of the Consolidated Entity that occurred during the financial
year not otherwise disclosed in this Directors’ Report or the Consolidated Financial Statements.
FUTURE DEVELOPMENTS
The Consolidated Entity intends to continue its investment activities in future years. The results of these investment
activities depend upon the performance of the underlying companies and securities in which the Consolidated Entity
invests. The investments’ performances depend on many economic factors and also industry and company specific
issues. In the opinion of the Directors, it is not possible or appropriate to make a prediction on the future course
of markets, the performance of the Consolidated Entity’s investments or the forecast of the likely results of the
Consolidated Entity’s activities.
3 For further information, please refer to the following ASX Announcements: Orion’s announcement dated 23 September 2005:
CXL Retains a 25% Free Carried Interest in NT Uranium Tenements and Strike’s announcement dated 11 August 2008:
Acquisition of Outstanding Interests in Berau Coal and Paulsens East Iron Ore Projects
ANNUAL REPORT | 5
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QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
ENVIRONMENTAL REGULATION
The Consolidated Entity is not subject to any particular or significant environmental regulation under Australian
Commonwealth or State legislation.
DIRECTORS
Information concerning Directors in office during or since the financial year:
Farooq Khan
Executive Chairman and Managing Director
Appointed 10 March 1998
Qualifications BJuris, LLB (Western Australia)
Experience Mr Khan is a qualified lawyer having previously practised principally in the field of corporate law.
Mr Khan has extensive experience in the securities industry, capital markets and the executive
management of ASX-listed companies. In particular, Mr Khan has guided the establishment and
growth of a number of public listed companies in the investment, mining and financial services
sectors. He has considerable experience in the fields of capital raisings, mergers and acquisitions
and investments.
Relevant interest in shares 5,344,872 shares4
Other current directorships
in listed entities
(1)
(2)
(3)
Executive Chairman of Bentley Capital Limited (ASX:BEL) (since 2 December 2003)
Executive Chairman of Orion Equities Limited (ASX:OEQ) (since 23 October 2006)
Chairman (appointed 18 December 2015) of Strike Resources Limited (ASX:SRK) (Director
since 1 October 2015)
Former directorships in
other listed entities in past
3 years
Alternate Director of Keybridge Capital Limited (ASX:KBC) (26 June to 18 July 2019)
Victor P. H. Ho
Executive Director and Company Secretary
Appointed Executive Director since 3 April 2013; Company Secretary since 30 August 2000
Qualifications BCom, LLB (Western Australia), CTA
Experience Mr Ho has been in Executive roles with a number of ASX-listed companies across the investments,
resources and technology sectors over the past 20 years. Mr Ho is a Chartered Tax Adviser (CTA)
and previously had 9 years’ experience in the taxation profession with the Australian Tax Office
(ATO) and in a specialist tax law firm. Mr Ho has been actively involved in the investment
management of listed investment companies (as an Executive Director and/or a member of the
Investment Committee), the structuring and execution of a number of corporate, M&A and
international joint venture (in South America, Indonesia and the Middle East) transactions, capital
raisings and capital management initiatives and has extensive experience in public company
administration, corporations’ law and ASX compliance and investor/shareholder relations.
Relevant interest in shares 17,500 shares5
Other current positions
held in listed entities
(1)
(2)
Executive Director and Company Secretary of Orion Equities Limited (ASX:OEQ) (Secretary
since 2 August 2000 and Director since 4 July 2003)
Director and Company Secretary of Strike Resources Limited (ASX:SRK) (Director since
24 January 2014 and Company Secretary since 1 October 2015)
(3)
Company Secretary of Bentley Capital Limited (ASX:BEL) (since 5 February 2004)
Company Secretary of Keybridge Capital Limited (ASX:KBC) (13 October 2016 to 13 October 2019)
Former positions in other
listed entities in past 3
years
4 Refer Farooq Khan’s Change of Director’s Interest Notices dated 10 July 2019 and 8 January 2018
5 Refer Victor Ho’s Initial Director’s Interest Notice dated 3 April 2013
ANNUAL REPORT | 6
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QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
Yaqoob Khan
Non-Executive Director
Appointed 10 March 1998
Qualifications BCom (Western Australia), Master of Science in Industrial Administration (Carnegie Mellon)
Experience After working for several years in the Australian Taxation Office, Mr Khan completed his
postgraduate Masters degree and commenced work as a senior executive responsible for
product marketing, costing systems and production management. Mr Khan has been an
integral member of the team responsible for the pre-IPO structuring and IPO promotion of a
number of ASX floats and has been involved in the management of such companies. Mr Khan
brings considerable international experience in key aspects of corporate finance and the
strategic analysis of listed investments.
Relevant interest in shares 68,345 shares6
Other current
directorships in listed
entities
Non-Executive Director of Orion Equities Limited (ASX:OEQ) (since 5 November 1999).
Former directorships in
other listed entities in past
3 years
None
DIRECTORS' MEETINGS
The following table sets out the numbers of meetings of the Company's Directors held during the financial year
(including Directors’ circulatory resolutions), and the numbers of meetings attended by each Director of the
Company:
Name of Director
Meetings Attended
Maximum Possible Meetings
Farooq Khan
Yaqoob Khan
Victor Ho
6
6
6
6
6
6
There were no meetings of committees of the Board of the Company.
Board Committees
During the financial year and as at the date of this Directors’ Report, the Company did not have separate
designated Audit or Remuneration Committees. In the opinion of the Directors, in view of the size of the
Board and nature and scale of the Queste’s activities, matters typically dealt with by an Audit or
Remuneration Committee are dealt with by the full Board.
6 Refer Yaqoob Khan’s Change of Director’s Interest Notice dated 6 September 2011
ANNUAL REPORT | 7
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
REMUNERATION REPORT
This Remuneration Report details the nature and amount of remuneration for each Director and Company Executive
(being a company secretary or senior manager) (Key Management Personnel) of Queste.
The information provided under headings (1) to (6) below has been audited for compliance with section 300A of
the Corporations Act 2001 (Cth) as required under section 308(3C).
(1) Remuneration Policy
The Board determines the remuneration structure of all Key Management Personnel having regard to the
Company’s strategic objectives, scale and scope of operations and other relevant factors, including
experience and qualifications, length of service, the duties and accountability of Key Management Personnel,
the frequency of Board meetings, market practice (including available data concerning remuneration paid
by other listed companies and in particular, companies of comparable size and nature) and the objective of
maintaining a balanced Board which has appropriate expertise and experience, at a reasonable cost to the
Company.
Corporate Governance Principles: The Company’s Corporate Governance Statement (CGS) also
addresses matters pertaining to the Board, Senior Management and Remuneration. The latest version of
the CGS may be downloaded from the Company’s website: http://queste.com.au/corporate-governance
Fixed Cash Short Term Employment Benefits: The Key Management Personnel of the Company are
paid a fixed amount per annum plus applicable employer superannuation contributions. The Non-Executive
Directors of the Company are paid a maximum aggregate base remuneration of $75,0007 per annum
inclusive of minimum employer superannuation contributions where applicable, to be divided as the Board
determines appropriate.
The Board has determined the following fixed cash remuneration for current Key Management Personnel as
follows (as at 30 June 2020):
Executive Director
(1) Mr Farooq Khan (Executive Chairman and Managing Director) - a base salary of $39,000 (voluntarily
reduced from $125,000) to assist the Company in reducing its corporate overheads) per annum plus
employer superannuation contributions; and
(2) Mr Victor Ho (Executive Director and Company Secretary) - a base salary of $39,000 (voluntarily
reduced from $45,000) per annum plus employer superannuation contributions. Mr Ho also agreed
to join the Board as an Executive Director on 3 April 2013 at no further cost to the Company.
Non – Executive Director
(3) Mr Yaqoob Khan (Non-Executive Director) - a base fee of $15,000 per annum.
Key Management Personnel can also opt to “salary sacrifice” their cash fees/salary and have them paid
wholly or partly as further employer superannuation contributions or benefits exempt from fringe benefits
tax.
Special Exertions and Reimbursements: Pursuant to the Company’s Constitution, each Director is
entitled to receive:
(a)
(b)
Payment for reimbursement of all travelling, hotel and other expenses reasonably incurred by a
Director for the purpose of attending meetings of the Board or otherwise in and about the business
of the Company; and
In respect of Non-Executive Directors, payment for the performance of extra services or the making
of special exertions for the benefit of the Company (at the request of and with the concurrence of
the Board).
Short-Term Benefits: The Company does not have any short-term incentive (STI) cash bonus schemes
(or equivalent) in place for Key Management Personnel.
7 As approved by shareholders at the Annual General Meeting held on 30 November 1999; refer Queste’s ASX announcement
dated 30 November 1999: Results of Annual General Meeting of Shareholders
ANNUAL REPORT | 8
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
REMUNERATION REPORT
Long-Term Benefits: The Company does not have any long-term incentive (LTI) cash bonus schemes (or
equivalent) in place for Key Management Personnel.
Equity Based Benefits: The Company does not presently have any equity (shares or options) based
remuneration arrangements for any personnel pursuant to any executive or employee share or option plan
or otherwise.
Post-Employment Benefits: The Company does not presently provide retirement benefits to Key
Management Personnel. Other than early termination benefits disclosed in ‘Employment Agreement’ below,
Key Management Personnel also have no right to termination payments save for payment of accrued unused
annual and long service leave (where applicable) (these accrued employee entitlements are not applicable
in respect of Non-Executive Directors). The Company notes that shareholder approval is required where a
Company proposes to make a “termination payment” (for example, a payment in lieu of notice, a payment
for a post-employment restraint and payments made as a result of the automatic or accelerated vesting of
share based payments) in excess of one year’s “base salary” (defined as the average base salary over the
previous 3 years) to a director or any person who holds a managerial or executive office.
Performance-Related Benefits and Financial Performance of Company: The Company does not
presently provide short- or long-term incentive/performance based benefits related to the Company’s
performance to Key Management Personnel, including payment of cash bonuses. The current remuneration
of Key Management Personnel is fixed, is not dependent on the satisfaction of a performance condition and
is unrelated to the Company’s performance.
The Board does not believe that it is appropriate at this time to implement an equity-based benefit scheme
or a performance related/variable component to Key Management Personnel remuneration or remuneration
generally linked to the Company’s performance but reserves the right to implement these remuneration
measures if appropriate in the future (subject to prior shareholder approval where applicable).
In considering the Company's performance and its effects on shareholder wealth, Directors have had regard
to the data set out below for the latest financial year and the previous four financial years.
2020
2019
2018
2017
2016
Loss Before Income Tax ($)
(847,983)
(1,369,019)
(1,151,518)
(2,122,392)
(896,730)
Basic Earnings/(Loss) per Share (cents)
(1.96)
(3.36)
(2.80)
(5.11)
(2.35)
Dividends Paid ($)
VWAP Share Price on ASX for financial year (cents)
Closing Bid Share Price at 30 June (cents)
-
3.1
2.2
-
7
6
-
7
7
-
7
7
-
7
5
(2) Employment Agreement
Details of the material terms of an employment agreement entered by the Company with a Key
Management Personnel are as follows:
Key
Management
Personnel
and
Position(s)
Held
Victor Ho
Company
Secretary (since
30 August
2000)
Executive
Director (since
3 April 2013)
Relevant
Date(s)
25 January 2000
(date of
employment
agreement)
2009/2010
(date of effect
of current
remuneration)
Base
Salary/Fees per
annum
$45,000
(but voluntarily
reduced to
$39,000, as at 30
June 2020)
plus employer
superannuation
contributions
(currently 9.5%
of base salary)
Other Material Terms
• The agreement has no fixed term or fixed rolling
terms of service.
• Standard annual leave (20 days) and personal/sick
leave (10 days paid) entitlements plus entitlement to
long service leave of 60 days after 7 years of service
with an additional 5 days after each year of service
thereafter.
• One month’s notice of termination by the Company or
employee. Immediate termination without notice if
employee commits any serious act of misconduct.
The Company does not presently have formal service agreements or employment agreements with any
other Key Management Personnel.
ANNUAL REPORT | 9
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
REMUNERATION REPORT
(3) Details of Remuneration of Key Management Personnel
Details of the nature and amount of each element of remuneration of each Key Management Personnel of
the Company paid or payable by the Consolidated Entity during the financial year are as follows:
Paid by the Company (Queste) to its Key Management Personnel
2020
Key
Management
Person
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Yaqoob Khan
2019
Key
Management
Person
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Yaqoob Khan
Performance
related
Short-term Benefits
Post-
Employment
Benefits
Other
Long-term
Benefits
Cash, salary
and
commissions
$
Non-cash
benefit
$
Superannuation
$
33,247
26,752
15,000
-
-
-
3,158
2,541
-
%
-
-
-
Long
service
leave
$
-
-
-
Performance
related
Short-term Benefits
Post-
Employment
Benefits
Other
Long-term
Benefits
Cash, salary
and
commissions
$
Non-cash
benefit
$
Superannuation
$
31,250
22,500
15,000
-
-
-
2,969
2,138
-
%
-
-
-
Long
service
leave
$
-
-
-
Paid by Orion to Key Management Personnel (who are also KMP of Queste)
2020
Key
Management
Personnel
Performance
related
%
Short-term Benefits
Cash, salary
and
commissions
$
Non-cash
benefit
$
Post-
Employment
Benefits
Other
Long-term
Benefits
Superannuation
$
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Yaqoob Khan
-
-
-
201,250
97,500
25,000
-
-
-
19,119
9,262
-
2019
Key
Management
Personnel
Performance
related
%
Short-term Benefits
Cash, salary
and
commissions
$
Non-cash
benefit
$
Post-
Employment
Benefits
Other
Long-term
Benefits
Superannuation
$
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Yaqoob Khan
-
-
-
201,250
97,500
25,000
-
-
-
19,119
9,263
-
Victor Ho is also Company Secretary of Queste and Orion.
Long
service
leave
$
-
-
-
Long
service
leave
$
-
-
-
Equity
Based
Shares &
Options
$
-
-
-
Equity
Based
Shares &
Options
$
-
-
-
Equity
Based
Shares &
Options
$
-
-
-
Equity
Based
Shares &
Options
$
-
-
-
Total
$
36,405
29,293
15,000
Total
$
34,219
24,638
15,000
Total
$
220,369
106,762
25,000
Total
$
220,369
106,763
25,000
The tables above may be aggregated to arrive at the aggregate amount of each element of remuneration
of each Key Management Personnel paid or payable by the Queste and Orion during the financial year.
ANNUAL REPORT | 10
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
REMUNERATION REPORT
(4) Other Benefits Provided to Key Management Personnel
No Key Management Personnel has during or since the end of the financial year, received or become entitled
to receive a benefit, other than a remuneration benefit as disclosed above, by reason of a contract made by
the Company or a related entity with the Director or with a firm of which he is a member, or with a Company
in which he has a substantial interest.
(5)
Engagement of Remuneration Consultants
The Company has not engaged any remuneration consultants to provide remuneration recommendations in
relation to Key Management Personnel during the year. The Board has established a policy for engaging
external Key Management Personnel remuneration consultants which includes, inter alia, that the Non-
Executive Directors on the Remuneration Committee be responsible for approving all engagements of and
executing contracts to engage remuneration consultants and for receiving remuneration recommendations
from remuneration consultants regarding Key Management Personnel. Furthermore, the Company has a
policy that remuneration advice provided by remuneration consultants be quarantined from Management
where applicable.
(6)
Shares held by Key Management Personnel
The number of ordinary shares in the Company held by Key Management Personnel is set below:
Key Management
Personnel
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Yaqoob Khan
Balance at 30
June 2019 Additions
Received as part
of remuneration
Disposals
5,612,972
17,500
68,345
-
-
-
-
-
-
-
-
-
Balance at
30 June
2020
5,612,972
17,500
68,345
Note:
The disclosures of shareholdings above are in accordance with the accounting standards which require disclosure of shares held
directly, indirectly or beneficially by each key management person, a close member of the family of that person, or an entity over
which either of these persons have, directly or indirectly, control, joint control or significant influence (as defined under Accounting
Standard AASB 124 Related Party Disclosures).
(7) Voting and Comments on the Remuneration Report at the 2019 AGM
At the Company’s most recent (2019) AGM, a resolution to adopt the prior year (2019) Remuneration Report
was put to the vote and passed unanimously on a show of hands with the proxies received also indicating
majority (99.7%) support in favour of adopting the Remuneration Report 8. No comments were made on
the Remuneration Report that was considered at the AGM.
This concludes the audited Remuneration Report.
8 Refer Queste’s ASX announcement dated 28 November 2019: Results of 2019 Annual General Meeting
ANNUAL REPORT | 11
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
DIRECTORS’ AND OFFICERS’ INSURANCE
Up until 31 December 2019, the Company had insured Directors and Officers against any liability they may have
incurred in respect of any wrongful acts or omissions made by them in such capacity (to the extent permitted by
the Corporations Act 2001 (Cth)) (D&O Policy). Details of the amount of the premium paid in respect of this
insurance policy are not disclosed as such disclosure is prohibited under the terms of the contract. The Company
did not renew the D&O Policy on expiry on 31 December 2019.
DIRECTORS DEEDS
In addition to the rights of indemnity provided under the Company’s Constitution (to the extent permitted by the
Corporations Act 2001 (Cth)), the Company has also entered into a deed with each of the Directors and the
Company Secretary (Officer) to regulate certain matters between the Company and each Officer, both during the
time the Officer holds office and after the Officer ceases to be an officer of the Company, including the following
matters:
(a)
(b)
The Company’s obligation to indemnify an Officer for liabilities or legal costs incurred as an officer of the
Company (to the extent permitted by the Corporations Act 2001 (Cth)); and
Subject to the terms of the deed and the Corporations Act 2001 (Cth), the Company may advance monies
to the Officer to meet any costs or expenses of the Officer incurred in circumstances relating to the
indemnities provided under the deed and prior to the outcome of any legal proceedings brought against the
Officer.
LEGAL PROCEEDINGS ON BEHALF OF CONSOLIDATED ENTITY
No person has applied for leave of a court to bring proceedings on behalf of the Consolidated Entity or intervene
in any proceedings to which the Consolidated Entity is a party for the purpose of taking responsibility on behalf of
the Consolidated Entity for all or any part of such proceedings. The Consolidated Entity was not a party to any
such proceedings during and since the financial year.
AUDITORS
Details of the amounts paid or payable to the Auditors for audit and non-audit services (tax services) provided
during the financial year are set out below:
Auditor
Rothsay Auditing
Audit &
Review
Fees
$
36,000
Consolidated Entity
Non-Audit
Services
$
Total
$
Audit &
Review
Fees
$
Company
Non-
Audit
Services
$
Total
$
-
36,000
14,000
-
14,000
Rothsay Auditing did not provide any non-audit services during the year.
Rothsay Auditing continues in office in accordance with section 327B of the Corporations Act 2001 (Cth).
AUDITORS’ INDEPENDENCE DECLARATION
A copy of the Auditor’s Independence Declaration as required under section 307C of the Corporations Act 2001
(Cth) forms part of this Directors Report and is set out on page 14. This relates to the Auditor’s Independent
Review Report, where the Auditor states that they have issued an independence declaration.
ANNUAL REPORT | 12
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
EVENTS SUBSEQUENT TO BALANCE DATE
The Directors are not aware of any other matters or circumstances at the date of this Directors’ Report, other than
those referred to in this Directors’ Report (in particular, in Review of Operations) or the financial statements or
notes thereto (in particular Note 25, that have significantly affected or may significantly affect the operations, the
results of operations or the state of affairs of the Company in subsequent financial years.
Signed for and on behalf of the Directors in accordance with a resolution of the Board.
Farooq Khan
Executive Chairman and
Managing Director
26 August 2020
Victor Ho
Executive Director and
Company Secretary
ANNUAL REPORT | 13
The Directors
Queste Communications Ltd
Level 2
31 Ventnor Avenue
West Perth WA 6005
Dear Directors
In accordance with Section 307C of the Corporations Act 2001 (the "Act") I hereby declare that to the best
of my knowledge and belief there have been:
(i) no contraventions of the auditor independence requirements of the Act in relation to the audit of
the 30 June 2020 financial statements; and
(ii) no contraventions of any applicable code of professional conduct in relation to the review.
This declaration is in respect of Queste Communications Ltd and the entities it controlled during the year.
Daniel Dalla CA (Lead auditor)
Partner
Rothsay Auditing
Dated 26 August 2020
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONSOLIDATED STATEMENT
OF PROFIT OR LOSS AND
OTHER COMPREHENSIVE INCOME
for the year ended 30 June 2020
Revenue
Other
Net gain on sale of non-current assets
Other revenue
Total revenue
Expenses
Share of Associate entity's loss
Net loss on financial assets at fair value through profit or loss
Land operation expenses
Personnel expenses
Occupancy expenses
Corporate expenses
Finance expenses
Administration expenses
Loss from continuing operations
Loss from discontinued operations
Income tax expense
Loss after income tax
OTHER COMPREHENSIVE INCOME
Revaluation of assets, net of tax
Note
2
3
5
6
2020
$
40,707
2019
$
56,650
-
81,668
122,375
201,786
-
258,436
(307,878)
(1)
(11,179)
(445,469)
(37,213)
(60,226)
(409)
(107,983)
(847,983)
-
-
(847,983)
(662,455)
(87,200)
(128,704)
(477,959)
(40,141)
(55,350)
(912)
(117,974)
(1,312,259)
(56,760)
(38,973)
(1,407,992)
-
(61,504)
Total comprehensive loss for the year
(847,983)
(1,469,496)
Loss attributable to:
Owners of Queste Communications Ltd
Non-controlling interest
Total comprehensive loss for the year is attributable to:
Continuing operations
Discontinued operations
Owners of Queste Communications Ltd
Continuing operations
Discontinued operations
Non-controlling interest
(530,823)
(317,160)
(847,983)
(910,108)
(497,884)
(1,407,992)
(530,823)
-
(530,823)
(317,160)
-
(317,160)
(978,878)
(33,976)
(1,012,854)
(433,859)
(22,783)
(456,642)
(847,983)
(1,469,496)
Basic and diluted loss per share (cents)
attributable to the ordinary equity holders
of the Company
7
(1.96)
(3.36)
The accompanying notes form part of these consolidated financial statements
ANNUAL REPORT | 15
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONSOLIDATED STATEMENT
OF FINANCIAL POSITION
as at 30 June 2020
Current assets
Cash and cash equivalents
Financial assets at fair value through profit or loss
Receivables
Other current assets
Total current assets
Non current assets
Receivables
Property held for development or resale
Investment in Associate entity
Property, plant and equipment
Deferred tax asset
Total non current assets
Total assets
Current liabilities
Payables
Provisions
Total current liabilities
Non current liabilities
Deferred tax liability
Total non current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Parent interest
Non-controlling interest
Total equity
Note
8
9
12
12
13
21
14
15
16
17
18
2020
$
352,272
450,003
96,261
-
2019
$
850,739
450,003
29,720
7,138
898,536
1,337,600
-
1,100,000
169,840
9,155
-
23,182
1,100,000
477,718
16,458
-
1,278,995
1,617,358
2,177,531
2,954,958
429,942
166,948
374,852
151,482
596,890
526,334
-
-
-
-
596,890
526,334
1,580,641
2,428,624
6,239,370
5,598,498
(11,286,179)
551,689
6,239,370
5,427,285
(10,780,510)
886,145
1,028,952
1,542,479
1,580,641
2,428,624
The accompanying notes form part of these consolidated financial statements
ANNUAL REPORT | 16
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
for the year ended 30 June 2020
Issued
capital
$
Reserves
$
Accumulated
losses
$
Non-
controlling
interest
$
Total
$
Balance at 1 Jul 2018
6,239,370
6,145,896
(10,029,625)
1,583,722
3,939,363
Loss for the year
Profits reserve transfer
Other comprehensive income
Total comprehensive
loss for the year
Transactions with owners in
their capacity as owners:
Transactions with
non-controlling interest
-
-
-
-
-
(159,223)
(102,746)
(261,969)
(910,108)
159,223
-
(750,885)
(497,884)
(1,407,992)
-
41,242
(456,642)
-
(61,504)
(1,469,496)
-
(456,642)
-
415,399
(41,243)
Balance at 30 Jun 2019
6,239,370
5,427,285
(10,780,510)
1,542,479
2,428,624
Balance at 1 Jul 2019
6,239,370
5,427,285
(10,780,510)
1,542,479
2,428,624
Loss for the year
Profits reserve transfer
Other comprehensive income
Total comprehensive
loss for the year
Transactions with owners in
their capacity as owners:
Transactions with
non-controlling interest
-
-
-
-
-
(25,154)
-
(530,823)
25,154
-
(317,160)
(847,983)
-
-
-
-
(25,154)
(505,669)
(317,160)
(847,983)
-
196,367
-
(196,367)
-
Balance at 30 Jun 2020
6,239,370
5,598,498
(11,286,179)
1,028,952
1,580,641
The accompanying notes form part of these consolidated financial statements
ANNUAL REPORT | 17
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONSOLIDATED STATEMENT
OF CASH FLOWS
for the year ended 30 June 2020
Cash flows from operating activities
Receipts from customers
Dividends received
Interest received
Payments to suppliers and employees
Interest paid
Sale of financial assets at fair value through profit or loss
Other receipts - ATO
2020
$
37,700
-
3,007
(620,034)
-
-
81,668
2019
$
212,795
108,698
12,821
(1,133,728)
(48)
82,844
-
Net cash used in operating activities
8(a)
(497,659)
(716,618)
Cash flows from investing activities
Purchase of plant and equipment
Disposal of plant and equipment
Proceeds from disposal of agribusiness assets
Commission on sale of agribusiness assets
(796)
-
-
-
-
413
1,451,786
(43,500)
Net cash provided by/(used in) investing activities
(796)
1,408,699
Cash flows from financing activities
Orion dividends paid
Queste off-market share buy-back
Net cash used in financing activities
(12)
-
(12)
(225)
-
(225)
Net increase/(decrease) in cash held
(498,467)
691,856
Cash and cash equivalents at beginning of financial year
850,739
158,883
Cash and cash equivalents at end of financial year
8
352,272
850,739
The accompanying notes form part of these consolidated financial statements
ANNUAL REPORT | 18
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
1.
ABOUT THIS REPORT
(c)
1.1
Background
the consolidated
financial report covers
This
financial
statement of the consolidated entity consisting of Queste
Communications Ltd, its subsidiary (controlled entity, Orion
Equities Limited ABN 77 000 742 843 (ASX:OEQ) (Orion or
OEQ) and Orion’s controlled entities) and an investment in its
associate entity Bentley Capital Limited (ASX:BEL) ABN 87 088
128 218 (Bentley or BEL) (the Consolidated Entity or
Queste). The financial report is presented in the Australian
currency.
Queste Communications Ltd (ASX:QUE) (the Company or
QUE) is a company limited by shares, incorporated in Western
Australia, Australia and whose shares are publicly traded on
the Australian Securities Exchange (ASX).
These financial statements have been prepared on a
streamlined basis where key information is grouped together
for ease of understanding and readability. The notes include
information which is required to understand the financial
statements and is material and relevant to the operations,
financial position and performance of the Consolidated Entity.
(e)
Information is considered material and relevant if, for example:
(a)
(b)
(c)
(d)
the amount in question is significant because of its size
or nature;
it is important for understanding the results of the
Consolidated Entity;
it helps to explain the impact of significant changes in
the Consolidated Entity’s business; or
(f)
it relates to an aspect of the Consolidated Entity’s
operations that is important to its future performance.
Other Assets and Liabilities: Provides information
on other balance sheet assets and liabilities that do not
materially affect performance or give rise to material
financial risk:
Notes
12
13
14
15
Receivables
Property held for resale
Payables
Provisions
(d)
Capital Structure: This section outlines how the
Consolidated Entity manages its capital structure and
related financing costs, as well as capital adequacy and
reserves. It also provides details on the dividends paid
by the Company:
Notes
16
17
18
Issued capital
Reserves
Non-controlling interest
Consolidated Entity Structure: Provides details and
disclosures relating to the parent entity of the
Consolidated Entity, controlled entities, investments in
associates and any acquisitions and/or disposals of
businesses in the year. Disclosure on related parties is
also provided in the section:
Notes
19
20
21
22
Parent entity information
Investment in controlled entity
Investment in associate entity
Related party transactions
Other: Provides information on items which require
disclosure to comply with Australian Accounting
Standards and other regulatory pronouncements
however,
in
understanding the financial performance or position of
the Consolidated Entity:
considered
significant
are not
The notes are organised into the following sections:
(a)
Key Performance: Provides a breakdown of the key
individual line items in the statement of comprehensive
income that the Directors consider most relevant to
understanding performance and shareholder returns
for the year:
Notes
2
3
4
5
6
7
Revenue
Expenses
Segment information
Discontinued Operations
Tax
Loss per share
(b)
Financial Risk Management: Provides information
about
the Consolidated Entity’s exposure and
management of various financial risks and explains
how these affect the Consolidated Entity’s financial
position and performance:
Notes
8
9
10
11
Cash and cash equivalents
Financial assets at fair value through
profit or loss
Financial risk management
Fair value measurement of financial
instruments
Notes
23
24
25
Auditors' remuneration
Contingencies
Events occurring after the reporting
period
Significant and other accounting policies that summarise the
measurement basis used and presentation policies and are
relevant to an understanding of the financial statements are
provided throughout the notes to the financial statements.
1.2. Basis of preparation
These general purpose financial statements have been
prepared in accordance with Australian Accounting Standards,
other authoritative pronouncements of
the Australian
Accounting
Board,
Accounting
Interpretations and the Corporations Act 2001 (Cth), as
appropriate for for-profit entities.
Standards
Australia
ANNUAL REPORT | 19
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
Compliance with IFRS
1.7. Dividends Policy
The consolidated financial statements of the Consolidated
Entity also comply with International Financial Reporting
Standards (IFRS) as issued by the International Accounting
Standards Board (IASB).
Provision is made for the amount of any dividend declared;
being appropriately authorised and no longer at the discretion
of the entity, on or before the end of the financial year but not
distributed at the Balance Date.
Reporting Basis and Conventions
1.8.
Leases
The financial report has been prepared on an accruals basis
and is based on historical costs modified by the revaluation of
selected non-current assets, and financial assets and financial
liabilities for which the fair value basis of accounting has been
applied.
1.3.
Principles of Consolidation
The consolidated financial statements incorporate the assets
and liabilities of the subsidiary of Queste Communications Ltd
as at 30 June 2020 and the results of its subsidiary for the year
then ended. Queste Communications Ltd and its subsidiary are
referred to in this financial statement as the Consolidated
Entity.
The controlled entity has a June financial year-end. All inter-
company balances and transactions between entities in the
Consolidated Entity, including any unrealised profits or losses,
have been eliminated on consolidation.
1.4.
Comparative Figures
Certain comparative figures have been adjusted to conform to
changes in presentation for the current financial year.
1.5. Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the
amount of GST, except where the amount of GST incurred is
not recoverable from the Australian Tax Office. In these
circumstances the GST is recognised as part of the cost of
acquisition of the asset or as part of an item of the expense.
Receivables and payables in the Statement of Financial Position
are shown inclusive of GST. Cash flows are presented in the
Statement of Cash Flows on a gross basis, except for the GST
component of investing and financing activities, which are
disclosed as operating cash flows.
1.6.
Impairment of Assets
At each reporting date, the Consolidated Entity reviews the
carrying values of its tangible and intangible assets to
determine whether there is any indication that those assets
have been impaired. If such an indication exists, the
recoverable amount of the asset, being the higher of the
asset’s fair value less costs to sell and value in use, is compared
to the asset’s carrying value. Any excess of the asset’s carrying
value over its recoverable amount is expensed to the profit or
loss. Impairment testing is performed annually for goodwill
and intangible assets with indefinite lives. Where it is not
possible to estimate the recoverable amount of an individual
asset, the Consolidated Entity estimates the recoverable
amount of the cash-generating unit to which the asset belongs.
the
lease commencement,
At
the Consolidated Entity
recognises a right-of-use asset and associated lease liability for
the lease term. The lease term includes extension periods
where the Consolidated Entity believes it is reasonably certain
that the option will be exercised.
The right-of-use asset is measured using the cost model where
cost on initial recognition comprises of the lease liability, initial
direct costs, prepaid lease payments, estimated cost of
removal and restoration less any lease incentives received.
The right-of-use asset is depreciated over the lease term on a
straight-line basis and assessed for impairment in accordance
with the impairment of assets accounting policy.
The lease liability is initially measured at the present value of
the remaining lease payments at the commencement of the
lease. The discount rate is the rate implicit in the lease,
however where this cannot be readily determined then the
Consolidated Entity’s incremental borrowing rate is used.
Subsequent to initial recognition, the lease liability is measured
at amortised cost using the effective interest rate method. The
lease liability is remeasured whether there is a lease
modification, change in estimate of the lease term or index
upon which the lease payments are based (e.g. CPI) or a
change in the Consolidated Entity’s assessment of lease term.
Where the lease liability is remeasured, the right-of-use asset
is adjusted to reflect the remeasurement or is recorded in profit
or loss if the carrying amount of the right-of-use asset has been
reduced to zero.
Exceptions to lease accounting
The Consolidated Entity has elected to apply the exceptions to
lease accounting for both short-term leases (i.e. leases with a
term of less than or equal to 12 months) and leases of
low-value assets. The Consolidated Entity recognises the
payments associated with these leases as an expense on a
straight-line basis over the lease term.
1.9. New, revised or amending Accounting Standards
and Interpretations adopted
The Consolidated Entity has adopted all of the new, revised or
amending Accounting Standards and Interpretations issued by
the AASB that are mandatory for the current reporting period.
Any new, revised or amending Accounting Standards or
Interpretations that are not mandatory have not been early
adopted. These are not expected to have a material impact on
the Consolidated Entity’s financial statements.
ANNUAL REPORT | 20
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
2. REVENUE
The Consolidated Entity's operating loss before income tax includes the
following items of revenue:
Revenue
Rental revenue
Dividend revenue
Interest revenue
Other
Net gain on sale of non-current assets
Other income
2020
$
37,700
-
3,007
40,707
2019
$
37,700
6,129
12,821
56,650
-
81,668
122,375
201,786
-
258,436
Accounting policy
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Consolidated
Entity and the revenue can be reliably measured. All revenue is stated net of the amount of Goods and Services
Tax (GST) except where the amount of GST incurred is not recoverable from the Australian Tax Office. The
following specific recognition criteria must also be met before revenue is recognised:
(a) Sale of financial assets, goods and other assets
Revenue from the sale of financial assets, goods or other assets is recognised when the Consolidated Entity
has passed control of the financial assets, goods or other assets to the buyer.
(b) Interest revenue
Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the
financial assets.
(c) Dividend revenue
Dividend revenue is recognised when the right to receive a dividend has been established. The Consolidated
Entity brings dividend revenue to account on the applicable ex-dividend entitlement date.
(d) Other revenues
Other revenues are recognised on a receipts basis.
3.
EXPENSES
The Consolidated Entity's operating loss before income tax includes the
following items of expenses:
Share of Associate entity's loss
Net loss on financial assets at fair value through profit or loss
Olive grove operations
Depreciation of olive grove assets
Other expenses
Land operations
Impairment loss on property held for development or resale
Other expenses
Salaries, fees and employee benefits
Occupancy expenses
Finance expenses
Corporate expenses
ASX and CHESS fees
ASIC fees
Share registry
Other corporate expenses
2020
$
307,878
1
-
-
-
11,179
445,469
37,213
409
33,449
17,809
5,806
3,162
2019
$
662,455
87,200
3,566
53,194
120,000
8,704
477,959
40,141
912
32,406
11,845
9,297
1,802
ANNUAL REPORT | 21
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
3.
EXPENSES (continued)
Administration expenses
Professional fees
Audit fees
Legal fees
Depreciation
Other administration expenses
4.
SEGMENT INFORMATION
2020
Segment revenues
Revenue
Other
Total segment revenues
Personnel expenses
Finance expenses
Administration expenses
Depreciation expenses
Other expenses
Total segment loss
Segment assets
Cash and cash equivalents
Financial assets
Property held for development or resale
Investment in Associate entity
Property, plant and equipment
Other assets
Total segment assets
Investments
$
37,700
-
37,700
-
-
(3,590)
-
319,057
(277,767)
-
450,003
1,100,000
169,840
-
-
1,719,843
Olive grove
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2020
$
2019
$
15,048
36,000
1,505
5,018
50,412
970,358
17,923
36,000
6,120
5,942
51,989
1,627,455
Corporate
$
3,007
81,668
84,675
445,469
409
103,476
5,018
100,519
(570,216)
Total
$
40,707
81,668
122,375
445,469
409
99,886
5,018
419,576
(847,983)
352,272
-
-
-
9,155
96,261
457,688
352,272
450,003
1,100,000
169,840
9,155
96,261
2,177,531
2019
Segment revenues
Revenue
Other
Total segment revenues
Personnel expenses
Finance expenses
Administration expenses
Depreciation expenses
Other expenses
Total segment loss
43,829
-
43,829
-
-
(4,432)
-
878,017
(829,756)
-
201,786
201,786
-
6
47,296
3,566
5,891
145,027
12,821
-
12,821
56,650
201,786
258,436
477,959
915
122,467
5,942
89,828
(684,290)
477,959
921
165,331
9,508
973,736
(1,369,019)
ANNUAL REPORT | 22
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
4.
SEGMENT INFORMATION (continued)
Segment assets
Cash and cash equivalents
Financial assets
Property held for development or resale
Investment in Associate entity
Property, plant and equipment
Other assets
Total segment assets
Investments
$
Olive grove
$
-
450,003
1,100,000
477,718
-
-
2,027,721
-
-
-
-
-
-
-
Corporate
$
850,739
-
-
-
16,458
60,040
927,237
Total
$
850,739
450,003
1,100,000
477,718
16,458
60,040
2,954,958
Accounting policy
The operating segments are reported in a manner consistent with the internal reporting provided to the "Chief
Operating Decision Maker" (CODM). The Consolidated Entity's CODM is the Board of Directors who are
responsible for allocating resources and assessing performance of the operating segments.
The Board has considered the business and geographical perspectives of the operating results and determined
that the Consolidated Entity operates only within Australia, with the main segments being Investments and Olive
Grove (which operations were sold in October 2018 - refer Note 5). Corporate items are mainly comprised of
corporate assets, office expenses and income tax assets and liabilities.
Description of segments
(a)
Investments comprise equity investments in companies listed on the Australian Securities Exchange (ASX)
and liquid financial assets;
(b) Olive grove is in relation to the olive grove farm in Gingin;
(c) Corporate items comprise corporate assets and operations.
Liabilities
Liabilities are not reported to the Board of Directors by segment. All liabilities are assessed at a consolidated entity
level.
5. DISCONTINUED OPERATIONS
On 11 October 2018, controlled entity, Orion Equities Limited (Orion) completed the sale of its Olive Grove
Agribusiness Assets in consideration of $1.45 million cash. Financial
information relating to the discontinued
operations are as follows:
Financial
incorporated into the Income Statement is as follows:
information relating to the discontinued operation which has been
2019
$
2020
$
Revenue
Expenses
Loss before income tax
Income tax expense
Loss after income tax
Gain on sale of Olive Grove Agribusiness Assets
Income tax
Gain on sale of Olive Grove Agribusiness Assets after tax
Reversal of revaluation of assets, net of tax
Net gain on sale of non-current assets
-
-
-
-
-
-
-
-
-
-
-
(56,760)
(56,760)
(38,973)
(95,733)
201,786
(38,973)
162,813
(102,746)
60,067
ANNUAL REPORT | 23
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
5. DISCONTINUED OPERATIONS (continued)
2020
$
2019
$
The carrying amount of the assets and liabilities of the operation at the date of
cessation were:
Total assets
Total liabilities
Net liabilities
The net cash flows of the operations, which have been incorporated into the
Cash Flow Statement are as follows:
Net cash used in operating activities
Net cash provided by investing activities
Effect on cash flows
-
-
-
-
-
-
Details of sale of operations:
Consideration received in cash
Carrying amount of net assets sold
Gain on sale of Olive Grove Agribusiness Assets
Income tax
Reversal of revaluation of assets, net of tax
Net gain on sale of non-current assets
1,403,475
(5,008,507)
(3,605,032)
(9,695)
1,413,000
1,403,305
1,456,500
(1,396,433)
60,067
38,973
99,040
102,746
201,786
Critical accounting judgement and estimate
Judgements have been made in the determination of consideration pertaining to assets sold during the financial
year. In making these judgements, the Consolidated Entity has considered the conditions and probability of receipt
pursuant to the relevant sale agreements.
Accounting policy
A discontinued operation is a component of the Consolidated Entity’s business where the operations and cash
flows can be clearly distinguished from the rest of the Consolidated Entity and which:
represents a separate major line of business or geographical area of operations;
is part of a single coordinated plan to dispose of a separate major line of business or geographical area of
operations; or
is a subsidiary acquired exclusively with a view to re-sale.
Classification as a discontinued operation occurs at the earlier of disposal or when the operation meets the criteria
to be classified as held-for-sale. When an operation is classified as a discontinued operation, the comparative
statement of profit or loss and other comprehensive income is re-presented as if the operation had been
discontinued from the start of the comparative year.
6.
TAX
The components of tax expense comprise:
Current tax
Deferred tax
- discontinued operations
2020
$
-
-
-
2019
$
-
38,973
38,973
ANNUAL REPORT | 24
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
6.
TAX (continued)
(a)
The prima facie tax on operating loss before income tax is
reconciled to the income tax as follows:
Prima facie tax payable on operating loss before income tax at 27.5%
(2019: 27.5%)
Adjust tax effect of:
Other assessable income
Non-deductible expenses
Share of Associate entity's loss
Current year tax losses not brought to account
Prior year's deferred tax assets recognition reversal
Income tax attributable to entity
2020
$
2019
$
(233,195)
(376,479)
-
403
84,666
148,126
-
-
38,905
2,116
182,175
153,283
38,973
38,973
Deferred tax assets
Deferred tax liabilities
2020
$
-
2019
$
38,973
(b) Fair value losses
(i) Movements - deferred tax assets
Fair value losses
Opening balance
(Credited)/charged to income statement
Closing balance
(ii) Movements - deferred tax liabilities
Fair value gains
Opening balance
Charged/(Credited) to the profit and loss
Closing balance
(iii)
Deferred tax recognised directly in Other Comprehensive Income
Revaluations of land & intangible assets
Unrecognised deferred tax balances
Unrecognised deferred tax asset - revenue losses
Unrecognised deferred tax asset - capital losses
Unrecognised deferred tax asset - timing differences
2020
$
-
2020
$
-
-
-
-
-
-
-
2019
$
38,973
2019
$
38,973
(38,973)
-
38,973
(38,973)
-
38,973
5,219,529
77,890
1,479,748
6,777,167
4,805,446
77,890
1,504,086
6,387,422
Critical accounting judgement and estimate
The above deferred tax assets have not been recognised in respect of the above items because it is not probable
that future taxable profit will be available against which the Consolidated Entity can utilise the benefits. Revenue
and capital tax losses are subject to relevant statutory tests.
ANNUAL REPORT | 25
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
6.
TAX (continued)
Accounting policy
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based
on the notional
income tax rate for each taxing jurisdiction adjusted by changes in deferred tax assets and
liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying
amounts in the financial statements, and to unused tax losses (if applicable).
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply
when the assets are recovered or liabilities are settled, based on those tax rates which are enacted or
substantively enacted for each taxing jurisdiction. The relevant tax rates are applied to the cumulative amounts of
deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception is made
for certain temporary differences arising from the initial recognition of an asset or a liability. No deferred tax
asset or liability is recognised in relation to these temporary differences if they arose in a transaction, other than a
business combination, that at the time of the transaction did not affect either accounting profit or taxable profit or
loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilise those temporary differences and losses. The
amount of deferred tax assets benefits brought to account or which may be realised in the future, is based on the
assumption that no adverse change will occur in income taxation legislation and the anticipation that the
Consolidated Entity will derive sufficient future assessable income to enable the benefit to be realised and comply
with the conditions of deductibility imposed by the law.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and
tax bases of investments in controlled entities where the Company is able to control the timing of the reversal of
the temporary differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and
tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a
net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax balances attributable to amounts recognised directly in other comprehensive income or
equity are also recognised directly in other comprehensive income or equity.
7.
LOSS PER SHARE
Basic and diluted loss per share (cents)
The following represents the loss and weighted average number of shares used
in the loss per share calculations:
Loss after income tax attributable to Owners of Queste Communications Ltd ($)
Weighted average number of ordinary shares
2020
2019
(1.96)
(3.36)
(530,823)
(910,108)
Number of shares
27,072,332
27,072,332
Accounting policy
Basic earnings per share is determined by dividing the operating result after income tax by the weighted average
number of ordinary shares on issue during the financial period.
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share by taking into
account amounts unpaid on ordinary shares and any reduction in earnings per share that will probably arise from
the exercise of options outstanding during the financial period.
ANNUAL REPORT | 26
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
8.
CASH AND CASH EQUIVALENTS
Cash at bank
(a)
Reconciliation of operating loss after income tax to net cash used
in operating activities
Loss after income tax
Add non-cash items:
Depreciation
Write off fixed assets
Net loss/(gain) on financial assets at fair value through profit or loss
Loss on land held for development or resale
Share of Associate entity's loss
Changes in assets and liabilities:
Receivables
Financial assets at fair value through profit or loss
Other current assets
Investment in Associate entity
Agribusiness assets
Payables
Provisions
Deferred tax
2020
$
352,272
2019
$
850,739
(847,983)
(1,407,992)
5,018
3,079
1
-
307,878
(43,359)
-
7,139
-
-
55,090
15,478
-
(497,659)
9,508
2,122
93,202
120,000
662,455
98,699
24,000
(942)
102,569
(201,786)
(269,716)
12,290
38,973
(716,618)
Accounting policy
Cash and cash equivalents includes cash on hand, deposits held at call with banks, other short-term highly liquid
investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts (if any) are
shown within short-term borrowings in current liabilities on the Statement of Financial Position.
9.
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
Listed securities at fair value
2020
$
450,003
2019
$
450,003
Accounting policy
Financial
instruments are initially measured at cost on trade date, which includes transaction costs, when the
related contractual rights or obligations exist. Subsequent to initial recognition, financial assets at fair value
through profit and loss acquired principally for the purpose of selling in the short term or if so designated by
management and within the requirements of AASB 139: Recognition and Measurement of Financial Instruments
will recognise its realised and unrealised gains and losses arising from changes in the fair value of these assets are
included in the Statement of Profit or Loss and Other Comprehensive Income in the period in which they arise.
The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading
and available-for-sale securities) is based on quoted market prices at the balance sheet date which is the current
bid price. The Consolidated Entity’s investment portfolio is accounted for as “financial assets at fair value through
profit and loss” and is carried at fair value.
ANNUAL REPORT | 27
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
10. FINANCIAL RISK MANAGEMENT
The Consolidated Entity's financial instruments consist of deposits with banks, accounts receivable and payable,
investments in listed securities, and other unlisted securities. The principal activity of the Consolidated Entity is
the management of these investments - "financial assets at fair value"
(refer to Note 9). The Consolidated
Entity's investments are subject to market (which includes interest rate and price risk), credit and liquidity risks.
The Board of Directors are responsible for
framework (which includes risk
management) but no cost-effective internal control system will preclude all errors and irregularities. The system is
based, in part, on the appointment of suitably qualified management personnel. The effectiveness of the system
is continually reviewed by management and at least annually by the Board.
internal control
the overall
The financial receivables and payables of the Consolidated Entity in the table below are due or payable within 30
days. The financial investments are held for trading and are realised at the discretion of the Board of Directors.
The Consolidated Entity holds the following financial assets and liabilities:
Cash and cash equivalents
Financial assets at fair value through profit or loss
Receivables
Payables
Net financial assets
(a) Market risk
Note
8
9
12
14
2020
$
352,272
450,003
96,261
898,536
(429,942)
468,594
2019
$
850,739
450,003
29,720
1,330,462
(374,852)
955,610
Market risk is the risk that the fair value and/or future cash flows from a financial instrument will fluctuate as
a result of changes in market factors. Market risk comprises of price risk from fluctuations in the fair value of
equities and interest rate risk from fluctuations in market interest rates.
(i) Price risk
The Consolidated Entity is exposed to equity securities price risk. This arises from investments held by
the Consolidated Entity and classified in the Statement of Financial Position at fair value through profit or
loss. The Consolidated Entity is not exposed to commodity price risk, save where this has an indirect
impact via market risk and equity securities price risk.
The value of a financial instrument will fluctuate as a result of changes in market prices, whether those
changes are caused by factors specific to the individual instrument or its issuer or factors affecting all
instruments in the market. By its nature as an investment company, the Consolidated Entity will always
be subject to market risk as it invests its capital in securities that are not risk free - the market price of
these securities can and will fluctuate. The Consolidated Entity does not manage this risk through
entering into derivative contracts, futures, options or swaps.
Equity price risk is minimised through ensuring that investment activities are undertaken in accordance
with Board established mandate limits and investment strategies.
The Consolidated Entity has performed a sensitivity analysis on its exposure to market price risk at
balance date. The analysis demonstrates the effect on the current year results and equity which could
result from a change in these risks. The ASX All Ordinaries Accumulation Index was utilised as the
benchmark for the unlisted and listed share investments which are financial assets available-for-sale or
at fair value through profit or loss.
ANNUAL REPORT | 28
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
10. FINANCIAL RISK MANAGEMENT (continued)
(i)
Price risk (continued)
ASX All Ordinaries
Accumulation Index
Increase 15%
Decrease 15%
(ii) Interest rate risk
Impact on
post-tax profit
Impact on other
components of equity
2020
$
4,336
(4,336)
2019
$
17,425
(17,425)
2020
$
4,336
(4,336)
2019
$
17,425
(17,425)
Interest rate risk is the risk that the value of a financial
instrument will fluctuate due to changes in
market interest rates. The Consolidated Entity's exposure to market risk for changes in interest rates
relate primarily to investments held in interest bearing instruments. The average interest rate for the
year for the table below is 0.35% (2019: 1.1%). The revenue exposure is immaterial in terms of the
possible impact on profit or loss or total equity.
Cash at bank and in hand
(b) Credit risk
2020
$
352,272
2019
$
850,739
Credit risk refers to the risk that a counterparty under a financial instrument will default (in whole or in part)
on its contractual obligations resulting in financial loss to the Consolidated Entity. Credit risk arises from cash
and cash equivalents and deposits with banks and financial institutions, including outstanding receivables and
committed transactions. Concentrations of credit risk are minimised primarily by undertaking appropriate due
diligence on potential
investments, carrying out all market transactions through approved brokers, settling
non-market transactions with the involvement of suitably qualified legal and accounting personnel (both
internal and external), and obtaining sufficient collateral or other security (where appropriate) as a means of
mitigating the risk of financial
loss from defaults. The Consolidated Entity's business activities do not
necessitate the requirement for collateral as a means of mitigating the risk of financial loss from defaults.
The credit quality of the financial assets are neither past due nor impaired and can be assessed by reference
to external credit ratings (if available with Standard & Poor's) or to historical information about counterparty
default rates. The maximum exposure to credit risk at Balance Date is the carrying amount of the financial
assets as summarised below:
Cash and cash equivalents
AA-
Receivables (due within 30 days)
No external credit rating available
2020
$
352,272
2019
$
849,585
96,261
29,720
The Consolidated Entity measures credit risk on a fair value basis. The carrying amount of financial assets
recorded in the financial statements, net any provision for losses, represents the Consolidated Entity's
maximum exposure to credit risk.
(c) Liquidity risk
Liquidity risk is the risk that the Consolidated Entity will encounter difficulty in meeting obligations associated
with financial
liabilities. The Consolidated Entity has no borrowings. The Consolidated Entity's non-cash
investments can be realised to meet trade and other payables arising in the normal course of business. The
financial liabilities disclosed in the above table have a maturity obligation of not more than 30 days.
ANNUAL REPORT | 29
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
11. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS
Fair value hierarchy
AASB 13 (Fair Value Measurement) requires disclosure of fair value measurements by level of the following fair
value measurement hierarchy:
(i)
(ii)
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (as prices) or indirectly (derived from prices); and
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Level 1
$
Level 2
$
Level 3
$
Total
$
(iii)
Financial assets at fair value through profit or loss:
Listed securities at fair value
2020
2019
450,003
450,003
-
-
-
-
450,003
450,003
There have been no transfers between the levels of the fair value hierarchy during the financial year.
(a) Valuation techniques
The fair value of the listed securities traded in active markets is based on closing bid prices at the end of the
reporting period. These investments are included in Level 1.
The fair value of any assets that are not traded in an active market are determined using certain valuation
techniques. The valuation techniques maximise the use of observable market data where it is available, or
independent valuation and rely as little as possible on entity specific estimates. If all significant inputs
required to fair value an instrument are observable, the instrument is included in Level 2. If one or more of
the significant inputs is not based on observable market data, the instrument is included in Level 3.
(b) Fair values of other financial assets and liabilities
Cash and cash equivalents
Receivables
Payables
2020
$
352,272
96,261
448,533
(429,942)
18,591
2019
$
850,739
29,720
880,459
(374,852)
505,607
Due to their short-term nature, the carrying amounts of cash, current receivables and current payables is
assumed to approximate their fair value.
Accounting policy
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for
disclosure purposes. The fair value of financial
instruments traded in active markets (such as publicly traded
derivatives, and trading and available-for-sale securities) is based on quoted market prices at the Balance Date.
The quoted market price used for financial assets held by the Consolidated Entity is the current bid price; the
appropriate quoted market price for financial liabilities is the current ask price.
The fair value of financial
instruments that are not traded in an active market (for example over-the-counter
derivatives) is determined using valuation techniques, including but not limited to recent arm’s length transactions,
reference to similar instruments and option pricing models. The Consolidated Entity may use a variety of methods
and makes assumptions that are based on market conditions existing at each Balance Date. Other techniques,
such as estimated discounted cash flows, are used to determine fair value for other financial instruments.
ANNUAL REPORT | 30
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
11. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS (continued)
Accounting policy
trade receivables and payables are assumed to
The nominal value less estimated credit adjustments of
approximate their fair values. The fair value of financial
liabilities for disclosure purposes is estimated by
discounting the future contractual cash flows at the current market interest rate that is available to the
Consolidated Entity for similar financial instruments.
The Consolidated Entity’s investment portfolio (comprising listed and unlisted securities) is accounted for as
“financial assets at fair value through profit and loss” and is carried at fair value based on the quoted last bid
prices at the Balance Date (refer Note 9).
12. RECEIVABLES
Current
Deposit
Other receivables
Non-current
Bonds and guarantees
2020
$
-
96,261
96,261
2019
$
27,500
2,220
29,720
-
23,182
Risk exposure
The Consolidated Entity’s exposure to credit and interest rate risks is discussed in Note 10.
Impaired trade receivables
None of the Consolidated Entity's receivables are impaired or past due.
Accounting policy
AASB 9: Financial Instruments introduces a new expected credit loss (ECL) impairment model that requires the
Consolidated Entity to adopt an ECL position across the Consolidated Entity’s financial assets at 1 July 2018. The
Consolidated Entity’s receivables balance comprises deposits and GST refunds from the Australian Tax Office.
At each Balance Date, the Consolidated Entity reviews the carrying value of its financial assets based on the ECL
model under AASB 9, which proposes three approaches in assessing impairment:
(i) the simplified approach (which will be applied to most trade receivables) which requires the recognition of
lifetime ECLs by considering forward-looking assumptions and information regarding expected future conditions
affecting historical customer default rates;
(ii) the general approach (which will be applied to most loans and debt securities) whereby ECL is recognised in
two stages. For credit exposures for which there has not been a significant increase in credit risk since initial
recognition, the Consolidated Entity will provide for credit losses that result from default events that are possible
within the next 12 months. For those credit exposures for which there has been a significant increase in credit
risk since initial recognition, a loss allowance will arise for credit losses expected over the remaining life of
exposure, irrespective of the timing of the default; and
(iii) For purchased or originated credit-impaired receivables, the fair value at initial recognition already takes into
account lifetime expected losses. At each Balance Date, the Consolidated Entity updates its estimated cash flows
and adjusts the loss allowance accordingly.
The loss allowances for financial assets are based on the assumptions about risk of default and expected loss
rates. The Consolidated Entity uses judgement in making these assumptions and selecting the inputs to the
impairment calculation, based on the Consolidated Entity’s past history, existing market conditions as well as
forward looking estimates at the end of each reporting period. The Consolidated Entity has not recognised any
additional impairment to its current receivables or non-current receivables as a result of the application of AASB 9.
This is due to the fact that the Consolidated Entity does not consider that there are any further ECL to the current
carrying values of its current receivables or its non-current receivables.
ANNUAL REPORT | 31
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
13. PROPERTY HELD FOR RESALE
Property held for development or resale
Revaluation of property
2020
$
3,797,339
(2,697,339)
1,100,000
2019
$
3,797,339
(2,697,339)
1,100,000
Critical accounting judgement and estimate
The carrying value of Property held for resale is based on the Directors’ judgement, having regard to the most
recent independent valuation report dated 29 July 2019 and an assessment of pertinent real estate market
conditions. The Directors are of the view that the property is not impaired as at balance date.
Accounting policy
Property held for resale is valued at the lower of cost and net realisable value. Cost includes the cost of
acquisition, development, borrowing costs and holding costs until completion of development. Finance costs and
holding charges incurred after development are expensed. Profits are brought to account on the signing of an
unconditional contract of sale.
14. PAYABLES
Current
Trade payables
Dividend payable
GST payable
Other payables and accrued expenses
Accrued Directors' fees and entitlements
2020
$
34,897
6,727
13,542
155,304
219,472
429,942
2019
$
17,749
6,739
13,827
40,097
296,440
374,852
Risk exposure
The Consolidated Entity’s exposure to risks arising from current payables is set out in Note 11.
Accounting policy
These amounts represent liabilities for goods and services provided to the Consolidated Entity prior to the end of
the financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of
recognition.
15. PROVISIONS
Current
Employee benefits - annual leave
Employee benefits - long service leave
2020
$
2019
$
44,567
122,381
166,948
36,191
115,291
151,482
(a) Amounts not expected to be settled within 12 months
The provision for annual leave and long service leave is presented as current since the Consolidated Entity
does not have an unconditional right to defer settlement for any of these employee benefits. Long service
leave covers all unconditional entitlements where employees have completed the required period of service
and also where employees are entitled to pro-rata payments in certain circumstances.
Based on past experience, the employees have never taken the full amount of long service leave or require
payment within the next 12 months. The following amounts reflect leave that is not expected to be taken or
paid within the next 12 months:
Leave obligations expected to be settled after 12 months
2020
$
122,381
2019
$
115,291
ANNUAL REPORT | 32
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
15. PROVISIONS (continued)
Accounting policy
Short-term obligations
Provision is made for the Consolidated Entity’s liability for employee benefits arising from services rendered by
employees to the Balance Date. Employee benefits that are expected to be settled within one year have been
measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee
benefits payable later than one year from the Balance Date have been measured at the present value of the
estimated future cash outflows to be made for those benefits. Employer superannuation contributions are made
by the Consolidated Entity in accordance with statutory obligations and are charged as an expense when incurred.
Other long-term employee benefit obligations
The liability for long-service leave is recognised in the provision for employee benefits and measured as the
present value of expected future payments to be made in respect of services provided by employees up to the
Balance Date. Consideration is given to expected future wage and salary levels, experience of employee
departures and periods of service.
16. ISSUED CAPITAL
Fully paid ordinary shares
2020
Number
27,072,332
2019
Number
27,072,332
2020
$
6,239,370
2019
$
6,239,370
There was no movement in the Company's issued capital during the financial year.
Capital risk management
The Company's objectives when managing its capital are to safeguard its ability to continue as a going concern, so
that it can continue to provide returns for shareholders and benefits for other stakeholders and to maintain a
capital structure balancing the interests of all shareholders.
The Board will consider capital management initiatives as is appropriate and in the best interests of the Company
and shareholders from time to time, including undertaking capital raisings, share Buy-backs, capital reductions and
the payment of dividends.
The Consolidated Entity has no external borrowings. The Consolidated Entity's non-cash investments can be
realised to meet accounts payable arising in the normal course of business.
Accounting policy
Ordinary shares are classified as equity. Fully paid ordinary shares carry one vote per share and the right to
dividends. At any meeting, each shareholder present in person or by proxy, attorney, or representative has one
vote for each fully paid ordinary share held either upon a show of hands or by a poll. Holders of partly-paid
ordinary shares have a fraction of a vote for each partly-paid share held, with the fractional vote of each share
being equivalent to the proportion of the total amount paid and payable (excluding amounts credited) that has
actually been paid (not credited) for each share. Amounts paid in advance of a call are ignored when calculating
proportions. The holder of a partly-paid ordinary share is not entitled to vote at a meeting in respect of those
shares on which calls are outstanding.
The profits of the Consolidated Entity, which the Directors may from time to time determine to distribute to
shareholders by way of dividends, will be divisible amongst the shareholders in proportion to the amounts paid on
is not to be included as an amount paid on a share for the
the shares. An amount paid in advance of a call
purposes of calculating an entitlement to dividends.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction,
net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options for the
acquisition of a business, are included in the cost of the acquisition as part of the purchase consideration.
ANNUAL REPORT | 33
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
17. RESERVES
Profits reserve
Option premium reserve
Other reserve
Dilution movement
Non-controlling interest
2020
$
2,892,899
2,138,012
2019
$
2,918,053
2,138,012
1,071,663
(504,076)
567,587
1,071,663
(700,443)
371,220
Total reserves
5,598,498
5,427,285
Movements in Profits reserve
Opening balance
Profits reserve transfer
Closing balance
2,918,053
(25,154)
3,077,276
(159,223)
2,892,899
2,918,053
Other Reserve relates to differences which may arise as a result of transactions with non-controlling interests that
do not result in a loss of control (refer also Note 18).
An increase in the Profits Reserve will arise when the Company or its subsidiaries generates a net profit (after tax)
for a relevant financial period (i.e. half year or full year) which the Board determines to credit to the company’s
Profits Reserve. Dividends may be paid out of (and debited from) a company’s Profits Reserve, from time to time.
18. NON-CONTROLLING INTEREST
Issued capital
Other reserve
Accumulated losses
2020
$
7,549,512
504,076
(7,024,636)
1,028,952
2019
$
7,549,512
700,443
(6,707,476)
1,542,479
The non-controlling interest is a 40.14% (2019: 40.14%) equity holding in Orion Equities Limited (not held by the
Company).
Accounting policy
The Consolidated Entity treats transactions with non-controlling interests that do not result in a loss of control as
transactions with equity owners of the Consolidated Entity. A change in ownership interest results in an
adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative
interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and
any consideration paid or received is recognised in a separate reserve (refer to Note 17) within equity attributable
to owners of Queste Communications Ltd.
19. PARENT ENTITY INFORMATION
The following information provided relates to the Company, Queste Communications Ltd, as at 30 June 2020.
Profit/(Loss) for the year
Other comprehensive income
Total comprehensive loss for the year
2020
$
(807,257)
2019
$
(550,187)
(807,257)
(550,187)
ANNUAL REPORT | 34
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
19. PARENT ENTITY INFORMATION (continued)
Statement of financial position
Current assets
Non-current assets
Total assets
Current liabilities
Loan from controlled entity
Total liabilities
Net assets
Issued capital
Reserves
Accumulated losses
Equity
2020
$
154,125
904,234
1,058,359
2019
$
58,693
1,681,924
1,740,617
262,525
90,130
352,655
227,656
-
227,656
705,704
1,512,961
6,239,370
2,347,229
(7,880,895)
705,704
6,239,370
2,347,229
(7,073,638)
1,512,961
20. INVESTMENT IN CONTROLLED ENTITY
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiary with
non-controlling interest:
Ownership Interest
Orion Equities Limited
Incorporated
Australia
2020
59.86%
2019
59.86%
2020
40.14%
2019
40.14%
Parent
Non-Controlling Interest
Summarised financial
information of
consolidated entity are set out below:
the subsidiary with non-controlling interests that are material
to the
Summarised statement of profit or loss and other comprehensive
income
Revenue
Expenses
Loss from continuing operations
Loss from discontinued operations
Income tax expense
Loss after income tax expense
Other comprehensive income
Total comprehensive loss for the year
Summarised Statement of Financial Position
Current assets
Non-current assets
Total Assets
Total Liabilities
Net Assets
Statement of cash flows
Net cash used in operating activities
Net cash used in investing activities
Net cash used in financing activities
Net increase/(decrease) in cash and cash equivalents
2020
$
65,618
(855,757)
(790,139)
-
-
(790,139)
-
(790,139)
2019
$
250,758
(1,434,372)
(1,183,614)
(56,760)
(38,973)
(1,279,347)
(102,746)
(1,382,093)
834,538
1,273,104
2,107,642
334,365
1,773,277
1,278,904
1,583,190
2,862,094
298,678
2,563,416
(434,059)
-
(85,600)
(519,659)
(629,769)
1,408,286
(225)
778,292
ANNUAL REPORT | 35
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
20. INVESTMENT IN CONTROLLED ENTITY (continued)
Other financial information
Profit/(Loss) attributable to non-controlling interest
Accumulated non-controlling interest at the end of the year
2020
$
(317,160)
1,028,952
2019
$
(497,884)
1,542,479
Accounting policy
Subsidiaries are all entities (including structured entities) over which the Consolidated Entity has control (also
controlled entities). The Consolidated Entity controls an entity when it is exposed to, or has rights to, variable
returns from its involvement with the entity and has the ability to affect those returns through its power to direct
the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the
Consolidated Entity. They are deconsolidated from the date that control ceases.
The controlled entity has a June financial year-end. All inter-company balances and transactions between entities
in the Consolidated Entity, including any unrealised profits or losses, have been eliminated on consolidation.
Changes in Ownership Interests
When the Consolidated Entity ceases to have control, any retained interest in the entity is re-measured to its fair
value with the change in carrying amount recognised in profit or loss. The fair value becomes the initial carrying
amount for the purposes of subsequently accounting for the retained interest as an associate or financial asset. In
addition, any amounts previously recognised in other comprehensive income in respect of that entity are
accounted for as if the Consolidated Entity has directly disposed of the related assets or liabilities. This may mean
that amounts previously recognised in other comprehensive income are reclassified to profit or loss.
21. INVESTMENT IN ASSOCIATE ENTITY
Bentley Capital Limited (ASX:BEL)
Movements in carrying amounts
Opening balance
Share of net loss after tax
Dividends received
Closing balance
Ownership Interest
2020
28.56%
2019
28.56%
Carrying Amount
2020
$
169,840
2019
$
477,718
477,718
(307,878)
-
169,840
1,242,742
(662,455)
(102,569)
477,718
Fair value (at market price on ASX) of investment in Associate entity
Net asset backing value of investment in Associate entity
760,884
1,487,913
1,630,465
1,813,602
Summarised statement of profit or loss and other comprehensive income
Revenue
Expenses
Loss before income tax
Income tax expense
Loss after income tax
Other comprehensive income
Total comprehensive income
475,345
(1,617,899)
(1,142,554)
296,380
(2,754,789)
(2,458,409)
-
-
(1,142,554)
(2,458,409)
-
-
(1,142,554)
(2,458,409)
ANNUAL REPORT | 36
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
21. INVESTMENT IN ASSOCIATE ENTITY (continued)
Summarised statement of financial position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
2020
$
5,743,904
4,872
5,748,776
540,424
-
540,424
2019
$
6,694,371
22,364
6,716,735
363,900
1,929
365,829
5,208,352
6,350,906
Under the equity method of accounting for Associate entities (refer Accounting Policy below), the Company’s
carrying value of its investment in BEL is reduced from (historical) cost as a consequence of the Company’s
accumulated recognition of BEL’s net losses. The Company is not required to carry the BEL investment at a
negative value (ie. below Nil) and if BEL should generate net profits in the future (after the Company has reduced
the carrying value of BEL to Nil), the Company will recognise a share of BEL’s net profits in this regard under the
equity method, which will permit the Company to start recognisng a positive carrying value for BEL.
Accounting policy
Associates are all entities over which the Consolidated Entity has or is deemed to have significant influence but not
control or joint control (generally in which the Consolidated Entity has a shareholding/voting rights of greater than
20% and less than 50%). Investments in Associates in the consolidated financial statements are accounted for
using the equity method of accounting. On initial recognition, investment in Associates are recognised at cost - in
respect of investments which were classified as fair value through profit or loss, any gains or losses previously
recognised are reversed through profit or loss. Under the equity method, the Consolidated Entity’s share of the
post-acquisition profits or losses of Associates are recognised in the consolidated Statement of Profit or Loss and
Other Comprehensive Income, and its share of post-acquisition movements in reserves is recognised in Other
Comprehensive Income. The cumulative post-acquisition movements are adjusted against the carrying amount of
the investment.
A share of an Associate entity's net gain increases the investment (and a share of net loss decreases the
investment) and dividend income received from an Associate entity decreases the investment. When the
Consolidated Entity’s share of losses in an Associate equals or exceeds its interest in the Associate, including any
other unsecured long-term receivables, the Consolidated Entity does not recognise further losses, unless it has
incurred obligations or made payments on behalf of the Associate.
Where applicable, unrealised gains on transactions between the Consolidated Entity and its Associates are
eliminated to the extent of the Consolidated Entity’s interest in the Associates. Unrealised losses are also
eliminated unless the transaction provides evidence of an impairment of the asset transferred. The accounting
policies of Associates are aligned to ensure consistency with the policies adopted by the Consolidated Entity,
where practicable.
22. RELATED PARTY TRANSACTIONS
(a) Loan from Controlled Entity
The Company is deemed to have control of Orion Equities Limited (ASX:OEQ) (OEQ) as it holds 59.86%
(9,367,653 shares) of Orion's issued capital (2019: 59.86% and 9,367,653 shares).
OEQ and the Company have entered into a Loan Agreement for the Company to borrow up to $200,000 from
OEQ (Loan). The Loan is unsecured and currently matures on 31 December 2020 and accrues interest at
10% pa in respect of the first $150,000 advanced and 7.5% pa in respect of $50,000 advanced thereafter.
During the financial year, the Company borrowed $90,000 and made $4,412 repayments to OEQ and incurred
interest expenses of $4,542 under the Loan.
ANNUAL REPORT | 37
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
22. RELATED PARTY TRANSACTIONS (continued)
(b)
Transactions with Related Parties
During the financial year there were transactions between the Company, Orion and Associate Entity, Bentley
Capital Limited (ASX:BEL), pursuant to shared office and administration expense arrangements. There were
no outstanding amounts at the Balance date. The following related party transactions also occurred during
the financial year:
Bentley Capital Limited
Dividends Received
(c) Transactions with key management personnel
2020
$
-
2019
$
108,698
Refer to the Remuneration Report contained in the Directors' Report for details of the remuneration paid or
payable to each member of the Consolidated Entity's KMP for the year ended 30 June 2020. The total
remuneration paid to KMP of the Consolidated Entity during the year is as follows:
(c) Transactions with key management personnel (continued)
Directors
Short-term employment benefits
Post-employment benefits
2020
$
398,749
34,080
432,829
2019
$
392,497
33,488
425,985
At Balance Date, the Company and Orion owes its Directors an aggregate $94,539 and $115,431 in unpaid
salaries respectively (net of PAYG withholding tax remitted to the ATO) .
During the year, the Consolidated Entity generated $37,700 rental income from a KMP/close family member
of KMP (the KMP being Queste and Orion Director, Farooq Khan), pursuant to a standard form residential
tenancy agreement
in respect of Property Held for Resale (held by Orion subsidiary, Silver Sands
Developments Pty Ltd) (2019: $37,700).
23. AUDITORS' REMUNERATION
During the year the following fees were paid for services provided by the auditor of the parent entity:
Rothsay Auditing
Audit and review of financial statements
24. CONTINGENCIES
2020
$
36,000
2019
$
36,000
(a)
Directors' Deeds
The Company has entered into Deeds of Indemnity with each of its Directors indemnifying them against
liability incurred in discharging their duties as Directors/Officers of the Consolidated Entity. At the end of the
financial period, no claims have been made under any such indemnities and accordingly, it is not possible to
quantify the potential financial obligation of the Consolidated Entity under these indemnities.
ANNUAL REPORT | 38
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2020
24. CONTINGENCIES (continued)
(b)
Tenement Royalties
Orion is entitled to receive a royalty of 2% of gross revenues (exclusive of GST) from any commercial
exploitation of any minerals from the Paulsens East Iron Ore Project tenement (currently a Retention Licence
R47/7 but pending conversion to a Mining Lease M47/1583) in Western Australia currently owned by Strike
Resources Limited (ASX:SRK). This royalty entitlement stems from Orion’s sale of a portfolio of tenements
(including the Paulsens East tenement) to Strike in September 2005. For further information in this regard,
please refer to the following ASX market announcements: Orion’s announcement dated 23 September 2005:
CXL Retains a 25% Free Carried Interest in NT Uranium Tenements and Strike’s announcement dated 11
August 2008: Acquisition of Outstanding Interests in Berau Coal and Paulsens East Iron Ore Projects. For
further background information about the Paulsens East Iron Ore Project, please refer to Strike’s ASX market
announcements and website: www.strikeresources.com.au.
25.
EVENTS OCCURRING AFTER THE REPORTING PERIOD
No matter or circumstance has arisen since the end of the financial year that significantly affected, or may
significantly affect, the operations of the Consolidated Entity, the results of those operations, or the state of affairs
of the Consolidated Entity in future financial years.
ANNUAL REPORT | 39
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ DECLARATION
The Directors of the Company declare that:
(1)
The financial statements, Consolidated Statement of Profit or Loss and Other Comprehensive Income,
Consolidated Statement of Financial Position, Consolidated Statement of Cash Flows, Consolidated
Statement of Changes in Equity, and accompanying notes as set out on pages 15 to 39 are in accordance
with the Corporations Act 2001 (Cth) and:
(a)
(b)
comply with Australian Accounting Standards, the Corporations Regulations 2001 and other
mandatory professional reporting; and
give a true and fair view of the Consolidated Entity’s financial position as at 30 June 2020 and of its
performance for the year ended on that date;
(2)
(3)
In the Directors’ opinion there are reasonable grounds to believe that the Company will be able to pay its
debts as and when they become due and payable;
The Directors have been given the declarations required by section 295A of the Corporations Act 2001 (Cth)
by the Executive Chairman/Managing Director (the person who, in the opinion of the Directors, performs
the Chief Executive Officer function) and Executive Director/Company Secretary (the person who, in the
opinion of the Directors, performs the Chief Financial Officer function); and
(4)
The Company has included in the notes to the Financial Statements an explicit and unreserved statement
of compliance with the International Financial Reporting Standards.
This declaration is made in accordance with a resolution of the Directors made pursuant to section 295(5) of the
Corporations Act 2001 (Cth).
Farooq Khan
Executive Chairman and
Managing Director
26 August 2020
Victor Ho
Executive Director and
Company Secretary
ANNUAL REPORT | 40
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
QUESTE COMMUNICATIONS LTD
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Queste Communications Ltd (“the Company”) and its subsidiaries
(“the Group”) which comprises the consolidated statement of financial position as at 30 June 2020, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for the year then ended on that date and
notes to the financial statements, including a summary of significant accounting policies and the directors’
declaration of the Company.
In our opinion the financial report of the Group is in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its financial
performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under these
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report
section of this report. We are independent of the Group in accordance with the auditor independence
requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and
Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the “Code”) that are
relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical
responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given
to the directors of the Company, would be in the same terms if given to the directors as at the time of this
auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial report of the current period. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
QUESTE COMMUNICATIONS LTD (continued)
Key Audit Matter – Impairment of Assets
The Group’s portfolio of assets includes:
Cash and cash equivalents;
Receivables;
Financial assets at fair value through profit or
loss;
Property held for development and resale; and
Investment in associates.
Given the continued uncertainty related to the COVID-19
pandemic this was considered to be a key audit matter as
significant judgement is required when assessing
impairment.
How our Audit Addressed the Key Audit
Matter
We considered the inputs into the
determination of fair value at year end and
compared our assessment with the written
down value.
We reviewed available information subsequent
to year end to assist in identifying any
conditions that may be indicative of the
recoverable amounts of these assets at year
end.
We assessed whether the disclosures included
in the financial report meet the requirements
of Australian Accounting Standards.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2020, but does not include the financial
report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial report or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Directors’ Responsibility for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with the Australian Accounting Standards and the Corporations Act 2001 and for
such internal control as the directors determine is necessary to enable the preparation of the financial
report that gives a true and fair view and is free from material misstatement whether due to fraud or error.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
QUESTE COMMUNICATIONS LTD (continued)
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Group or cease operations,
or have no realistic alternative but to do so.
Auditor’s Responsibility for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with Australian Auditing Standards will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if individually or in
the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing
and Assurance Standards Board website at: www.auasb.gov.au/Home.aspx.
We communicate with the directors regarding, amongst other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we identify
during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit matters.
We describe those matters in our auditor’s report unless law or regulation precludes public disclosure about
the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected
to outweigh the public interest benefits of such communications.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the remuneration report included in the directors’ report for the year ended 30 June 2020.
In our opinion the remuneration report of Queste Communications Ltd for the year ended 30 June 2020
complies with section 300A of the Corporations Act 2001.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
QUESTE COMMUNICATIONS LTD (continued)
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an
opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing
Standards.
Rothsay Auditing
Dated 26 August 2020
Daniel Dalla
Partner
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
ADDITIONAL ASX INFORMATION
as at 9 October 2020
CORPORATE GOVERNANCE STATEMENT
The Company has adopted the Corporate Governance Principles and Recommendations (3rd Edition, March 2014)
issued by the ASX Corporate Governance Council in respect of the financial year ended 30 June 2020.
Pursuant to ASX Listing Rule 4.10.3, the Company’s 2020 Corporate Governance Statement (dated on or about 13
October 2020) and ASX Appendix 4G (Key to Disclosures of Corporate Governance Principles and
Recommendations) can be
Internet website:
http://queste.com.au/corporate-governance
following URL on
the Company’s
found at
the
VOTING RIGHTS
Subject to any rights or restrictions for the time being attached to any class or classes of shares (at present there
are none), at meetings of shareholders of the Company:
(1)
(2)
(3)
Each shareholder entitled to vote may vote in person or by proxy or by power of attorney or, in the case of
a shareholder which is a corporation, by representative;
Every person who is present in the capacity of shareholder or the representative of a corporate shareholder
shall, on a show of hands, have one vote;
Every shareholder who is present in person, by proxy, by power of attorney or by corporate representative
shall, on a poll, have one vote in respect of every fully paid share held by him; and
SUBSTANTIAL SHAREHOLDERS
Substantial Shareholders
Registered Shareholder
Shareholding
Total
Shares
%Voting
Power5
Azhar Chaudhri,
Chi Tung Investments Limited
and Renmuir Holdings Limited1
Farooq Khan
and Associate2
Geoff Wilson
and Associates3
Fred Woollard and
Samuel Terry Asset Management
Pty Ltd ATF Samuel Terry Absolute
Return Fund4
Chi Tung Investments Ltd
3,608,956
Renmuir Holdings Ltd
Mr Azhar Chaudhri
Mr Farooq Khan
& Ms Rosanna De Campo
Island Australia Pty Ltd
Dynasty Peak Pty Ltd
J P Morgan Nominees Australia
Limited
3,277,780
8,322,737
30.74%
1,436,001
4,921,295
423,577
4,391,975
3,717,820
5,344,872
19.74%
4,391,975
16.22%
Frederick Raymond Woollard
21,862
3,739,682
13.81%
Notes:
(1)
(2)
(3)
(4)
(5)
Based on the substantial shareholding notice filed by Azhar Chaudhri and associates dated 23 October 2017 (updated to
reflect current registered shareholdings and percentage voting power).
Based on the Change of Interests of Substantial Holder notice filed by Farooq Khan and associates dated 20 November
2014 (updated to reflect current registered shareholdings and percentage voting power) and the Change of Director’s
Interest Notices filed by Farooq Khan dated 10 July 2019 and 8 January 2018.
Based on the Change of Interests of Substantial Holder Notice filed by Geoff Wilson and associates dated 14 February
2018.
Based on the Notice of Initial Substantial Holder notice filed by Samuel Terry Asset Management Pty Ltd dated 5 February
2018 (updated to reflect current registered shareholdings and percentage voting power).
Movements of less than 1% in voting power are not required to be disclosed to ASX via an updated substantial
shareholding notice and accordingly, there may be variances between the shareholdings recorded in the table above and
the most recent substantial shareholding notices lodged on ASX. Current registered shareholdings have been disclosed
(where applicable).
ANNUAL REPORT | 45
30 JUNE 2020
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
ADDITIONAL ASX INFORMATION
as at 9 October 2020
DISTRIBUTION OF LISTED ORDINARY FULLY PAID SHARES
Spread of Holdings
1
1,001
5,001
10,001
100,001
Total
-
-
-
-
-
1,000
5,000
10,000
100,000
and over
Number of Holders
17
44
58
83
20
Number of Units
8,811
121,362
520,496
2,271,255
24,150,408
% of Total Issue Capital
0.03%
0.45%
1.92%
8.39%
89.21%
222
27,072,332
100.00%
UNMARKETABLE PARCELS
Spread of Holdings
1
18,519
Total
- 18,518
- over
Number of Holders Number of Shares
1,270,363
25,801,969
161
61
% of Total Issued Capital
4.69%
95.31%
222
27,072,332
100.00%
An unmarketable parcel is considered, for the purposes of the above table, to be a shareholding of 18,518 shares or less, being
a value of $500 or less in total, based upon the Company’s last sale price on ASX as at 9 October 2020 of $0.027 per share.
TOP 20 ORDINARY FULLY PAID SHAREHOLDERS
Rank Shareholder
1 MR AZHAR AMIN CHAUDHRI
CHI TUNG INVESTMENTS LTD
RENMUIR HOLDINGS LTD
2 MR FAROOQ KHAN + MS ROSANNA DE CAMPO
ISLAND AUSTRALIA PTY LTD
3
4
5
6
DYNASTY PEAK PTY LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
GLENVIEW SERVICES PTY LTD
GA & AM LEAVER INVESTMENTS PTY LTD
7 MS ROSANNA DE CAMPO
8
9
GIBSON KILLER PTY LTD
THE ESTATE OF MR AYUB KHAN
10 MRS AFIA KHAN
14 MR EUGENE RODRIGUEZ
15 MRS MARY THERESE CAMILLERI
16 MRS LINDA ANN OATES
17 DR SIEW NAM UN
18 MRS WENDY MARGARET BELL
19 MANAR NOMINEES PTY LTD
20
YAQOOB KHAN
KYA CORPORATION PTY LTD
Total
11 MR SIMON KENNETH CATO + MRS KAYE LOUISE HOPKINS
ROSEMONT ASSET PTY LTD
12
TOMATO 2 PTY LTD
13 MR JOHN CHENG-HSIANG YANG + MS PEGA PING MOK
118,000
75,000
Sub-total
Shares
Held
Total
Shares
% Issued
Capital
1,436,001
3,608,956
3,277,780
Sub-total
4,921,295
423,577
Sub-total
8,322,737
30.74
5,344,872
4,391,975
3,875,568
380,000
378,012
268,100
220,000
215,000
215,000
193,000
185,019
136,125
110,000
100,000
100,000
87,500
75,000
72,247
19.74
16.22
14.32
1.40
1.40
0.99
0.81
0.79
0.79
0.71
0.68
0.50
0.41
0.37
0.37
0.32
0.28
0.27
15,020
53,325
Sub-total
68,345
0.25
24,738,500
91.36%
ANNUAL REPORT | 46
ASX Code: QUE
Queste Communications Ltd
A.B.N. 58 081 688 164
SHARE REGISTRY:
Advanced Share Registry Limited
Western Australia – Main Office
110 Stirling Highway
Nedlands, Western Australia 6009
PO Box 1156, Nedlands,
Western Australia 6909
Local T | 1300 113 258
T | (08) 9389 8033
F | (08) 6370 4203
E | admin@advancedshare.com.au
PRINCIPAL & REGISTERED OFFICE:
Level 2
31 Ventnor Avenue
West Perth, Western Australia 6005
T | (08) 9214 9777
F | (08) 9214 9701
E | info@queste.com.au
W | www.queste.com.au
New South Wales – Branch Office
Suite 8H, 325 Pitt Street
Sydney, New South Wales 2000
PO Box Q1736, Queen Victoria Building
New South Wales 1230
T | (02) 8096 3502
W | www.advancedshare.com.au