MONEYSWITCH LIMITED
ABN 49 103 575 042
FINANCIAL STATEMENTS
F OR T HE PERIOD END ED 30 JU NE 2OO3
MONEYSWITCH LIMITED
ABN 49 103 575 042
FINANCIAL STATEMENTS
F OR T HE PERIOD END ED 30 JU NE 2OO3
CONTENTS
Directors' Report
Auditors'Report
Directors' Declaration
Gonsol idated Statement of Fi nancial performance
Gonsolidated Statement of Financial position
Notes to & Forming Part of the Financial Statements
Accountant's Compilation Report
Revenue Statement
MONEYSWITCH LIMITED
ABN 49 103 575 042
DIRECTORS' REPORT
The directors present their report for the period ended 30 June, 2003 and the auditois reoort thereon.
DIRECTORS
The names of directors at any time during or since the end of the year are:
Name
Paul Wood
Peter Haig
Andrew Rothwell
Richard Freemanfle
Occupation
Managers
Managers
Managers
Executive
Appointed
3t02t2003
3t02t2003
3t02t2003
20t06t2003
PRINCIPAL ACTIVITIES
The principal activities of the company during the financial year were:
- the development of software and applications associated with credit card and associated financial
transactions.
REVIEW AND RESULTS OF OPERATIONS
The loss of the company after providing for income tax amounted to $66,124.
DIVIDENDS
No dividends have been declared or paid since the date of incorooration.
STATE OF AFFAIRS
The Company was incorporated on 3 February, 2003 and continued its operations during the year, being the
development of software associated with credit card and associated financial transactions.
ENVIRONMENTAL
The company operations are not subject to any environmental regulations.
ISSUES
EVENTS SUBSEQUENT TO BALAI,ICE SHEET DATE
There has not arisen in the interval between end of financial year and the date of this report any item , transaction
or event of a material or unusual nature, which in the opinion of the directors of the Company, will affect
significantly the operation of the company, the results of these operations or the state of affairs of the company,
in future financial years.
LIKELY DEVELOPMENTS
At the date of this report, the company is following the proposals of the Reserve Bank of Australia to open up
the financial services industry and particularly credit card transactions to competition. ln the event that the
regulators are unsuccessful in this regard the company will most likely be forced to change its strategies.
MONEYSWITCH LIMITED
ABN 49 103 575 042
DIRECTORS' REpORT (cont,d)
MEETINGS OF DIRECTORS
The number of directors' meetings and number of meetings attended by each of the directors of the Company
during the financial year are:
Paul Wood
Peter Haig
Andrew Rothwell
Richard Freemantle
Number
held*
Number
attended*
2
2
2
0
z
2
2
0
* Number of meetings held during the time the director held office during the year
INDEMN]FICATION AND INSURANCE OF OFFICERS
The company has not, during or since the financial year, in respect of any person who is or has been an
officer or auditor of the company or of a related body corporate:
D indemnified or made any relevant agreement for indemnifying against a liability, including costs and
expenses in successfully defending legal proceedings with the exception of the general indemnity provisions
contained in the Company's Constitution; or
E paid or agreed to pay a premium in respect of a contract insuring against a liability for the costs or
expenses to defend legal proceedings.
Sisned in Sydney on tne /(
day of A
,r;
2003 on behatf of the Board
Director
TNDEpENDENT AUDrr REpoRr Mitchell & Partners
To the Members of
MONEYSWITCH LIMITED
C H A B T E R E D A C C O U N T A N T S
SCOPE
We have audited the financial report of MoneySwitch Limited ("the Company") for the financial period ended
30 June 2003, consisting of the statements of financial performance, statements of financial position,
statements of cash flows, accompanying notes, and the directors declaration set out on pages 4 to 16. The
financial report includes the financial statements of the company and any entity it controlled at the end of the
year or from time to time during the financial year. The Company's directors are responsible for the financial
report. We have conducted an independent audit of this financial report in order to express an opinion on it
to the members of the Company.
Our audit has been conducted in accordance with Australian Auditing Standards to provide reasonable
Assurance whether the financial report is free of material misstatement. Our procedures included examination,
on a test basis, supporting the amounts and other disclosures in the financial report, and the evaluation of
accounting policies and significant accounting estimates. These procedures have been undertaken to form an
opinion whether, in all material respects, the financial report is presented fairly in accordance with
Accounting Standards other mandatory professional reporting requirements in Australia and statutory
requirements so as to present a view which is consistent with our understanding of the Company's and the
consolidated entity's financial position, and performance as represented by theiesults of their operations
and their cash flows.
The audit opinion expressed in this report has been formed on the above basis.
AUDIT OPINION
In our opinion, the financial report of MoneySwitch Limited is in accordance with:
(a)
the Corporations Act 2001, including:
D giving a true and fair view of the Company's financial position as at 30 June 2003
and of its performance of the year ended on that date; and
ii) complyrng with Accounting Standards in Australia and the Corporations Regulations 2001; and
b)
other mandatory professional reporting requirements in Australia.
Chartered Accountants
,/2 /J4/*-//),*U
....
G
Glenn Merchant - Partner
Signed at Sydney on 2n O5'=n ,
2043
r York Street Sydney
rsw 2ooo Australia
TETEPHO|E: 02 9257 3838
FACSIMILE: 02 9257 3OO8
reception@mitchelloartners.com.au
@ an"rr"red Accountants
b e y o n d a c c o u n t i n g
Liability is limited by the
Accountants Scheme, approved
under the hofessional Slandards Act
r994 (NSW)
MONEYSWITCH LIMITED
ABN 49 103 575 042
DIRECTORS' DECLARATION
In the opinion of the directors of MoneySwitch Limited ("the Company"):
(a) the financial statements and notes set out on pages 5 to 16 are in accordance with the Corporations Act 2001,
including:
(i) giving a true and fair view of the financial position of the Company as at 30 June 2003 and
of the performance, as represented by the results of the operations and the cash flows,
for the year ended on that date; and
(ii) complying with Accounting Standards in Australia and the Corporations Regulations 2001; and
(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable.
Signed in accordance with a resolution of the Board of Directors.
Dated at 9:"!
tni' Zg
day ot ./Vt
2oos
f@*
Director
MONEYSWITCH LIMITED
ABN 49 103 575 042
STATEMENT OF FINANCIAL PERFORMANCE
FOR THE PERIOD ENDED 30 JUNE 2OO3
NOTE
Revenue
Write-down/provision
in non-current assets
Other expenses from ordinary activities
Profit/(loss) from ordinary activities before related
income tax expense
Income tax expense relating to ordinary activities
Net profiV (loss) attributable to members of parent entity
1 2
30.Jun-03
$
3,054
3,054
0
-69,178
-66,124
0
-66,124
The above Statement of Financial Performance should be read in conjunction with the accompanying notes.
MONEYSWITCH LIMITED
ABN 49 103575042
STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2OO3
NOTE
CURRENT ASSETS
Cash assets
Receivables
TOTAL CURRENT ASSETS
NON.CURRENT ASSETS
Property
Other financial assets
Other assets
TOTAL NON.CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Payables
TOTAL CURRENT LTABILITIES
NON.CURRENT LIABILTTIES
Non interesting bearing liabilities
TOTAL NON.CURRENT LIABILTTIES
TOTAL LIABILITIES
NET ASSETS
M E M B E R S ' E Q U I T Y
lssued Capital
Retained profits
TOTAL SHAREHOLDERS' EQUITY
30-Jun-03
$
201,437
1 2 , 8 1 1
214,248
16,374
0
3,254
19,628
233,876
0
233,876
300,000
-66,124
233,876
7
8
I
1 0
1 1
1 3
1 2
The above Statement of Financial Position should be read in conjunction with the accompanying notes.
MONEYSWITCH LIMITED
ABN 49 103 s75 042
STATEMENT OF CASH FLOWS AS AT 30 JUNE 2OO3
STATEMENT OF CASH FLOWS
CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts in the course of operations
Cash payments in the course of operations
Interest received
Net cash provided by operating activities
1 8 ( b )
CASH FLOWS FROM INVESTING ACTIVITIES
Other assets acquisition
Acquisition of fixed assets
Net cash provided by investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings
Repayments of borrowings
Proceeds from issue of shares
Net cash provided by financing activities
Net increase/(decrease)
Cash at the beginning of the year
in cash held
Cash at the end of the year
30Jun-03
$
0
-77,422
3,054
-74,368
-4,067
-20,128
-24,195
10,000
-10,000
300,000
0
300^000
201,437
0
The above Statement of Cash Flows should be read in conjunction with the accompanying notes.
1 8
__?01,43?
MONEYSWITCH LIMITED
ABN 49 103 575 042
NOTES TO THE FINAI.IGIAL STATEMENTS FOR THE PERTOD ENDED 30 JUNE, 2OO3
1. STATEMENT OF ACCOUNTING POLICIES
The significant policies which have been adopted in the preparation of this financial report are:
(a) Basis of preparation
The financial report is a general purpose report which has been prepared in accordance with Accounting
Standards, Urgent lssues Group Consensus Views, other authoritative pronouncements of the Australian
Accounting Standards Board and the Corporations Act 2001.
The financial report covers the economic entity of MoneySwitch Limited. MoneySwitch Limited is an unlisted
public company, incorporated and domiciled in Australia.
The financial report has been prepared on the basis of historical cost and, except where stated, does not take into
account changing money values orfair values of non-current assets.
These accounting policies have been consistently applied by each entity in the consolidated entity and, except
where there is a change in accounting policy, are consistent with those of the prior year.
(b) Income Tax
The company adopts the liability method of tax-effect accounting whereby the income tax expense is
calculated on the operating profit, adjusted for permanent differences. Timing differences which anse
due to the different accounting periods in which items of revenue and expense are included in the
determination of operating profit and taxable income, are brought to account as either provision for
deferred income tax or as an asset described as future income tax benefit at the rate of income tax
applicable to the period in which the benefit will be received or the liability will become payable. Future
income tax benefits are not brought to account unless realisation of the asset is assured beyond any
reasonable doubt. Future income tax benefits in relation to tax losses are not brought to account unless
realisation of the asset is assured beyond any reasonable doubt. The amount of 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 company will derive sufficient future
assessable income to enable the benefit to be realised and comply with the conditions of deductibilig
imposed by the law.
(c) Revenue recognition
Revenues are recognised at fair value of the consideration received net of the amount of goods and services tax
(GST) payable to the taxation authority. Exchanges of goods and services of the same nature and value without
any cash consideration are not recognised as revenues
Interest Revenue
Interest revenue is recognised as it is received.
(d) Goods & 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 taxation authority. In these circumstances the GST is recognised as part of
the cost of acquisition of the asset or as part of the expense. Receivables and payables are shown inclusive
of GST.
The net amount of GST recoverable from, or payable to, the taxation authority is included as a current asset or
liability in the statements of financial position.
Cash flows are included in the statements of cash flows on a gross basis. The GST components of cash flows
arising from investing and financing activates which are recoverable from, or payable to, the taxation authority are
classified as operating cash flows.
MONEYSWITCH LIMITED
ABN 49 103575042
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE,2OO3
STATEMENT OF ACCOUNTING POLIC|ES (cont'd)
(e) Revisions of accounting estimates
Revisions to accounting estimates are recognised prospectively in current and future periods only.
(f) Acquisition of assets
All assets acquired including property, plant and equipment are initially recorded at their cost of acquisition at the
date of acquisition, being the fair value of the consideration provided plus incidental costs direc1y attributable to
the acouisition.
Expenditure is only recognised as an asset when the entity controls future economic benefits as a result of the
cost incurred, it is probably that those future economics benefits will eventuate, and the costs can be measured
reliability. Costs attributable to feasibility and alternative approach assessments are expensed as incurreo.
(g) Recoverable amount of non-current assets valued on cost basis
The carrying amount off non-current assets valued on the cost basis are reviewed to determine whether they are
in excess of their recoverable amount at balance date. lf the carrying amount of a non-current asset exceeds the
recoverable amount, the asset is written down to the lower amount. The write-down is expensed in the reporting
period in which it occurs.
Where a group of assets working together supports the generation of cash inflows, recoverable amount is a
assessed in relation to that group of assets.
In assessing recoverable amounts of non-current assets the relevant cash flows have not been discounted to
their present value, except where specifically stated.
Cost versus fair value
Except where specifically stated, non-current assets are recorded at the lower of cost and recoverable amount.
(h) Receivables
Receivables are recognised at cost and where some or all of the amount is not recoverable, a provision is made
against the amount not likely to be recovered.
(i) Payables
Amounts are included in the financial statements as monies received or the value of the benefit provided.
fi) Property
Propertv. olant and equipment
Property, plant and equipment is recognised at the lower of cost or recoverable amount.
MONEYSWITCH LIMITED
ABN 49 103 575042
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE, 2OO3
2.REVENUE FROM ORDINARY ACTIVITIES
Interest
Other parties
Sundry
3. PROFIT FROM ORDINARYACTIVITIES BEFORE INCOME TAX
(a) Individuallv sionificant expenses included in profit
from ordinary activities before income tax exoense
W rite-d own/p rovi sion i n no n-c u rre nf assets
4. AUDITOR'S REMUN ERATION
Audit Seruices:
Auditors of the company - Mitchell & Partners
Audit of the financial reDorts
Olher Serylces:
Auditors of the company - Mitchell & Partners
Other assurance services
5. INGOME TA)(
Operating profit for the year
Prima facie income tax expense on
profit from ordinary activities (30%)
Income tax losses carried forward
Income tax expense
30-lun-03
$
3,054
0
3,054
0
0
-66,124
- 1 9 , 8 3 7
1 9 , 8 3 7
1 0
MONEYSWITCH LIMITED
ABN 49 103 575 042
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE,2OO3
6. RECEIVABLES
Current
Trade debtors
Sundry debtors
GST refund due
Non-current
Amounts owing by related parties:
Controlled entities
Related entities
7.PROPERry
Prooertv. olant & equioment
Plant & equipment - at cost
Accumulated Depreciation
Furniture & equipment - at cost
Accumulated Depreciation
Low Value Pool - at cost
Accumulated Depreciation
Reconciliations
Reconciliations of the carrying amount for each class
of property are set out below:
Propertv, olant & equioment
Carrying amount at beginning of year
Additions
Write-down in arena costs and other assets
Carrying amount at end of year
8. OTHER FINANCIAL ASSETS
Non-current
g.OTHER ASSETS
Non-current
Formation costs
Accumulated amortisation
30.Jun-03
$
9,466
3,345
___12,811
0
0
0
8,661
1,602
7,059
2,105
421
1,684
9,363
1,732
7,631
16,374
0
20,129
-3,755
16,374
4,067
8 1 3
-3254-
MONEYSWITCH LIMITED
ABN 49 103 575 042
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE,2OO3
10. PAYABLES
Trade creditors
Accruals
1 1.NON INTEREST BEARING LIABILITIES
NON CURRENT
Loans
12. RETAINED PROFITS
Retained profits at the beginning of the financial year
Net Profit attributable to the members of the parent entity
Retained profits at the end of the financial year (refer note)
13. CONTRIBUTED EQUITY
The company has issued 3,000,000 ordinary shares paid to 10c each during the year
300,000 Ordinary shares paid at 10c each
Shares issued durinq the vear:
3 February, 2003 - 1,000,000 Ordinary shares at 10c each
18 February, 2003 - 500,000 Ordinary shares at 10c each
21 February, 2003 - 400,000 Ordinary shares at 10c each
8 April, 2003 - 1,000,000 Ordinary shares at 10c each
19 May, 2003 - 1 00,000 Ordinary shares at 1 0c each
14. CONTROLLED ENTITIES
Particulars in relation to controlled entities
There are no controlled entities as at 30 June, 2003 nor were any acquired or sold during the period.
30r|un-03
$
0
0
0
-66,124
-66,124
300,000
300.000
100,000
50,000
40,000
100,000
10,000
300,000
1 2
MONEYSWITCH LIMITED
ABN 49 103 575042
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE,2OO3
1 5. CONTINGENT LIABILITIES
There are no known contingent liabilities as at the date of this report.
16. FINANCIAL REPORTING BY SEGMENTS
The company operates in the financial services industry in Australia.
The principal activity is the development of software for credit card transactions.
17. SUBSEQUENT EVENTS
There has not arisen in the interval between end of financial year and the date of this report any item , transaction
or event of a material or unusual nature, in the opinion of the directors of the Company, to affect significanfly the
operation of the company, the results of these operations or the state of affairs of the company, in future
financial years.
1 3
MONEYSWITCH LIMITED
ABN 49 103 575 042
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE,2OO3
18. NOTES TO THE STATEMENT OF CASH FLOWS
(a) Reconcillation of Cash
cash at the end of the financial year as shown in the statement of cash flows
is reconciled to the related items in the statement of financial position as follows:
Cash
(b) Reconciliation of ooeratinq orofit from ordinarv activities after income tax
to net cash provided bv ooeratino activities
Profit from ordinary activities after income tax
Non Cash items included in operating loss:
Expenses paid by related entity
Depreciation
Amortisation
Net Cash provided by operating activities before
change in assets and liability
Ghange in assets and liabilities
Decrease/(lncrease)
Decrease/(lncrease)
lncrease/(Decrease)
Net cash provided by operating activities
in receivables
in other assets
in payables
30.Jun-03
$
201,437
201,437
_66,1124
0
3,70b
g13
-61,556
0
-12,812
0
-74,368
1 4
MONEYSWITCH LIMITED
ABN 49 103 575 042
NOTES TO THE FINANGIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE, 2OO3
19. ADDITIONAL FINANCIAL INSTRUMENTS DISCLOSURES
Credit Risk
Credit Risk represents the loss that would be recognised if counterparties failed to perform as contracted.
Recoonised financial instruments
The credit risk on financial assets, excluding investments, of the consolidated entity which have been recognised
on the statements of financial position, is the carrying amount, net of any provision for doubtful debts.
Interest rate risk
The consolidated entity's financial assets and liabilities are subject to interest rate risk. These will fluctuate in
accordance with movements in the market interest rates. The consolidated entity's exposure to interest rate risk
and the effective average interest rate from classes of financial assets and financial liabilities is set out below:
2003
Financial assets
Cash assets
Receivables
Other assets
Financial assets
Payables
Other Liabilities
Weighted Floating Non-interest
rate
Total
bearing
$
Note average
interest
rate
17(al
o
I
1 0
1 1
4.30o/o 201,437
201/W
0
12,811
3,254
201,437
12,811
3,254
0
0
0
0
0
0
0
Pre Establishment
There were no consolidated entity financial assets or liabilities prior to the formation of the company on 3
February, 2003.
Net fair values of financial assets and liabilities
For all financial assets and liabilities the fair net value approximates their carrying value. No financial assets and
financial liabilities are readily traded on organised markets.
The aggregate net fair values and carrying amounts of financial assets and financial liabilities are disclosed in
the statements of financial position and in the notes to the financial statements.
20. CAPITAL COMMITMENTS
The company does not have any capital commitments as at the date of this report.
21. DIRECTORS REMUNERATTON
No remuneration is paid to the Directors of the Company
1 5
MONEYSWITCH LIMITED
ABN 49 103575042
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE, 2OO3
22. RELATED PARTY TRANSACTIONS
Directors
The names of each person holding the position of director of MoneySwitch Limited during the financial period
are P Wood, P Haig, A Rothwell and R Freemantre.
All Directors were appointed during the financial period
Transactions
The company has not entered into any transactions with the directors during the period except for the
issuing of shares to the directors or their associated parties. The issued capital has been issued solely
to the Directors or their associated entities.
Non-director related oarties
There are no non director related parties.
1 6
MONEYSWITCH LIMITED
ABN 49 103 575 042
Mitchell & Partners
C H A R T E R E D A C C O U N T A N T S
COMPILATION REPORT
to the members of MONEYSWITCH LIMITED
On the basis of information provided by the directors of MoneySwitch Limited we have
compiled, in accordance with APS 9 "statement
on Compilation of Financial Reports",
the general purpose financial report for the period ended 30 June 2003
The directors are responsible for the information contained in the special pu{pose financial report and
have determined that the accounting policies are consistent with the financial reporting requirements of
MoneySwitch Limited and are appropriate to meet the needs of the members.
Our procedures have been limited to the classification and summarisation of information to compile this
special purpose financial report from the information provided to us by the directors and does not include
verification or validation procedures. No audit or review has been performed and accordingly no
assurance is expressed.
Neither the firm nor any member or employee of the firm undertakes any responsibility or accepts liability
in any way whatsoever to any person (other than the directors of MoneySwitch Limited) in respect of
the special purpose financial report including any effors or omissions report however caused in the
special purpose financial.
MITCHELL & PARTNERS
Chartered Accountants
Glenn Merchant - Partner
Signed at Sydney this Jq{\
day of A-3- st
2003
1 York Street Sydney
Nsw 2ooo Australia
TELEPHoNE: 02 9251 38)8
fAcsrMfrE: 02 9257 1oo8
rmrl: reception@mitchelloartners.com.au
@ Cn"r,"red Accountants
b e y o n d a c c o u n t i n g
I
tl
?-.4
EM[glcE ryy4 (NJw)
Liability is limiledby ttre
Accountants Scheme, approved
1rlgqr lhe_hofesional Standards Act
MONEYSWITCH LIMITED
ABN 49 103 575 042
INCOME AND EXPENDITURE STATEMENT FOR THE PERIOD ENDED 30 JUNE ,2003
Gompany
30-Jun-03
0
3,054
3,054
1 , 7 6 2
30,832
1 , 7 3 2
2,358
36,684
8 1 3
1 , 5 4 0
282
2,023
1 , 1 9 8
1 , 5 7 6
1 6 3
5,445
4,569
11,562
2,099
5 1 6
708
32,494
6 9 , 1 7 8
I N C O M E
Other Income
Interest Income - AMP
TOTAL INCOME
OVERHEAD EXPENDITURE
Engineering
Books & Subscriptions
Contractor fees
Depreciation
Training
Total Engineering
General & Administration
Amortisation of Formation expenses
Accountancy fees
Books & Subscriptions
Depreciation
Insurance
Internet
lnterest
Legal fees
Office supplies
Rent
Telephone
Travelling
Utilities
Total General & Administration
TOTAL EXPENSES
PROFTn(LOSS)
NET Loss for the year
This Income & Expenditure Account does not form part of the audited accounts.
1 8