Ultima United Limited
ACN 123 920 990
Annual Report
For the Financial Year Ended 30 June 2017
CONTENTS
Corporate Directory
Directors’ Report
Auditor’s Independence Declaration
Statement of Profit or Loss and Other Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report to the Members of Ultima United Limited
Corporate Governance Statement
Additional Shareholder Information
Ultima United Limited - Annual Report
For the year ended 30 June 2017
PAGE
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35
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40
49
2
CORPORATE DIRECTORY
Ultima United Limited - Annual Report
For the year ended 30 June 2017
EXECUTIVE CHAIRMAN & MANAGING DIRECTOR
(Simon) Xing Yan
NON-EXECUTIVE DIRECTORS
Eric Kong
(James) Zixi Ban
COMPANY SECRETARY
Piers Lewis
PRINCIPAL & REGISTERED OFFICE
Suite 14,11 Preston Street
COMO, WA 6152
Telephone: (08) 6436 1888
Facsimile: (08) 9367 3311
AUDITORS
Moore Stephens
Level 15 Exchange Tower,
2 The Esplanade
PERTH WA 6000
SHARE REGISTRAR
Advanced Share Registry Services
110 Stirling Highway
NEDLANDS WA 6009
Telephone: (08) 9389 8033
Facsimile: (08) 9262 3723
SECURITIES EXCHANGE LISTING
Australian Securities Exchange
(Home Exchange: Perth, Western Australia)
Codes: UUL
3
Ultima United Limited - Annual Report
For the year ended 30 June 2017
DIRECTORS' REPORT
The directors of Ultima United Limited (the “Company”) submit herewith the financial report of the Company for the
financial year ended 30 June 2017. In order to comply with the provisions of the Corporations Act 2001, the directors
report as follows:
1) BOARD OF DIRECTORS
The names and details of the Company’s directors in office during and since the financial year end until the date of the
report are as follows. Directors were in office for the entire period unless otherwise stated.
Directors
Position
(Simon) Xing Yan
Executive Chairman & Managing Director
Eric Kong
Non-Executive Director
(James) Zixi Ban
Non-Executive Director (appointed 5 December 2016)
Piers Lewis
Non-Executive Director (appointed 22 September 2016, resigned 5 December 2016)
George Lazarou
Executive Director (resigned 22 September 2016)
2)
INFORMATION ON DIRECTORS
(Simon) Xing Yan
Experience
Executive Chairman & Managing Director
Mr Yan has over 30 years of senior level management experience in international mining
trade. He was part of the management team of China National Minerals and Metals Import
& Export Corporation (MINMETALS).
Mr Yan migrated to Western Australia where he established numerous import export
businesses. Mr Yan developed a number of commercial properties, including “Woodsons”
(formerly Parry’s Department Store) in Fremantle and Huntingdale Village Shopping
Centre. Mr Yan was also a licensed real-estate agent for nearly 20 years, which provided
him with a deep knowledge of the Western Australian property market.
Interest in Shares
Mr Yan is widely sought after as a consultant for international trade issues due to his
broad contacts and knowledge of Chinese and Australian business systems.
1,642,500 Fully paid Ordinary Shares
Interest in Options
Nil
Eric Kong
Qualifications
Experience
Non-Executive Director
MBA
Mr. Kong holds an MBA from the University of Western Australia and has extensive
corporate experience with Fortune 500 companies. He served in Solectron’s supply chain
management division where he often worked with top tier clients that include IBM, Cisco,
Sun Microsystems and Lucent Technologies. He then served as Asia Pacific regional
accounts manager for Molex; being responsible for business strategy, development and
growth in the highly competitive electronics contract manufacturing industry.
He is the founder and former director of Altis West; a business consulting firm managing
Chinese joint ventures in Australian mining and property sectors.
Interest in Shares
Mr Kong is an experienced manager with intricate knowledge of global business models,
trends and high-level expertise in both eastern and western management styles.
35,775 Fully paid Ordinary Shares
Interest in Options
Nil
4
Ultima United Limited - Annual Report
For the year ended 30 June 2017
DIRECTORS' REPORT
(James) Zixi Ban
Experience
Interest in Shares
Non-Executive Director (appointed 5 December 2016)
Mr Ban was the General Manager of Western Australia Building Group; a domestic,
commercial and mining building design and construction company that provide
engineering and design solutions for complex and large structures/projects. Mr Ban has
a degree in architecture from UWA.
10,000
Interest in Options
Nil
Piers Lewis
Qualifications
Experience
Interest in Shares
Non-Executive Director (appointed 22 September 2016, resigned 5 December 2016)
B Comm, GIA, CA
Mr Lewis has more than 15 years global corporate experience and is Company Secretary
for several ASX listed companies. In 2001 Mr Lewis qualified as a Chartered Accountant
with Deloitte (Perth), and has diverse financial and corporate experience from previous
senior management roles with Credit Suisse (London), Mizuho International and NAB
Capital.
Nil
Interest in Options
Nil
George Lazarou
Executive Director (resigned 22 September 2016)
Qualifications
Experience
BCom, CA
Mr Lazarou is a qualified Chartered Accountant with over 20 years’ experience, including
five years as a partner of a mid-tier accounting firm, specialising in the areas of audit,
advisory and corporate services. Mr Lazarou has extensive skills in the areas of audit,
corporate services, due diligence, independent expert reports, mergers & acquisitions
and valuations.
Mr Lazarou also brings with him a high level of commercial skills having worked closely
with publicly listed companies in the mining, building, engineering, environmental and
construction industries.
Interest in Shares
Mr Lazarou is currently the Managing Director of corporate advisory firm Citadel Capital
and Non-Executive Chairman of Volta Mining Limited.
779,750 Fully paid Ordinary Shares
Interest in Options
Nil
Directorships of other listed companies
Directorships of other listed companies held by directors in the 3 years immediately before the end of the financial year
are as follows:
Name
Company
Period of Directorship
Xing Yan (Simon)
Eric Kong
(James) Zixi Ban
Piers Lewis
George Lazarou
-
-
-
-
-
- Cycliq Group Limited
- Dawine Limited
- Ardiden Limited
- Hawkley Oil and Gas Limited
- eSports Mogul Asia Pacific Limited
-
- Current
- Current
- Resigned 12 April 2017
- Resigned 16 March 2017
- Current
3) COMPANY SECRETARY
Mr Piers Lewis
Mr Lewis has more than 15 year’s global corporate experience and is currently Company Secretary and CFO for several
ASX listed Companies. Mr Lewis specializes in financial management of listed and non-listed exploration companies
and brings extensive and diverse financial and corporate experience from previous senior management roles with
Credit Suisse (London), Mizuho International and NAB Capital. Mr Lewis holds a Bachelor of Commerce and is a
member of the Australian Institute of Chartered Accountants and Governance Institute of Australia.
5
Ultima United Limited - Annual Report
For the year ended 30 June 2017
DIRECTORS' REPORT
4) PRINCIPAL ACTIVITIES
The principal activity of the Company during the financial year was property development.
5) FINANCIAL RESULTS
The financial results of the Company for the year ended 30 June 2017 are:
Cash and cash equivalents ($)
Net assets ($)
1,117,853
2,388,220
1,375,502
3,511,982
(19%)
(32%)
30/06/2017
30/06/2016
% Change
Revenue ($)
Net loss after tax ($)
Loss per share ($)
30/06/2017
30/06/2016
% Change
32,644
(1,123,762)
(4.41)
95,384
(416,659)
(1.63)
(66%)
170%
170%
6) DIVIDENDS PAID OR RECOMMENDED
The directors do not recommend the payment of a dividend and no amount has been paid or declared by way of a
dividend to the date of this report.
7) REVIEW OF OPERATIONS
PROPERTY DEVELOPMENT
295 Canning Highway, Como, Western Australia
The Company has a 50% interest in the property at 295 Canning Highway, Como, pursuant to a Joint Venture for Profit
Sharing Agreement between the Company and S & A Holding (Aust) Pty Ltd.
On 16 December 2016, the Company confirmed the settlement of 295C Canning Highway, Como, with net proceeds
from the sale of the property totaling approximately $635,000, of which the Company shall receive 50% of the net
proceeds.
This concludes the sale and settlement of all units for 295 Canning Highway, Como.
3 Oak Street, Cannington, Western Australia
On 2 February 2016 the Company received development approval (subject to conditions) from the City of Canning for
the construction of 12 apartments at 3 Oak Street, Cannington, with each apartment having 2 bedrooms and 2
bathrooms.
Since receiving development approval, the Company has obtained costings for the development, initiated discussions
with various construction companies as well as indicative pre-sale pricing. Subsequent to year end the Company has
received a loan proposal document from an Australian bank to fully fund the development. An announcement shall be
made to the ASX once the loan terms are finalized and formally agreed to by all stakeholders.
The market for pre-sales for apartments in Western Australia remains somewhat weak. However the company is
optimistic that the design and location of the development represent a good value to potential buyers.
19-21 Tate Street, Bentley, Western Australia
During the 30 June 2016 financial year the Company applied for and received authority to amalgamate 19 & 21 Tate
Street, Bentley into one property, and development approval (subject to conditions) from the City of Canning for the
construction of 14 apartments at 19 & 21 Tate Street, Bentley, with 10 apartments having 2 bedrooms and 2 bathrooms
and 4 apartments having 1 bedroom and 1 bathroom.
Since receiving development approval, the Company has proceeded to obtain costings for the development, initiated
discussions with various construction companies as well as indicative pre-sale pricing. However given the current bleak
property sentiment across Western Australia, the Directors have taken a conservative view by recognizing an
impairment of $772,326 on the two developments.
The Company will commence development on its Bentley property following the completion of the Cannington
development and if market conditions improve and funding can be secured.
6
DIRECTORS' REPORT
8) SIGNFICANT CHANGES IN STATE OF AFFAIRS
There were no significant changes in the state of affairs of the Company during the financial year.
Ultima United Limited - Annual Report
For the year ended 30 June 2017
9) AFTER BALANCE DATE EVENTS
On 14 July 2017, the Company received a loan proposal document from an Australian bank to fully fund the Oak Street
development. An announcement shall be made to the ASX once the loan terms are finalized and formally agreed to by
all stakeholders.
The directors are not aware of any other matters or circumstances that have arisen since the end of the financial year
which significantly affected or may significantly affect the operations of the Company, the results of those operations,
or the state of affairs of the Company in future financial years.
10) MEETINGS OF DIRECTORS
The number of Director’s meetings held during the financial year and the number of meetings attended by each Director
during the time the Director held office are:
Directors
Xing Yan
Eric Kong
(James) Zixi Ban
Piers Lewis
George Lazarou
Directors Meetings
Number Eligible
to Attend
Meetings
Attended
2
2
1
-
1
2
2
1
-
1
The Company does not have a formally constituted audit committee nor a remuneration committee as the board
considers that the company’s size and type of operation do not warrant such committees.
11) FUTURE DEVELOPMENTS
The Directors continue to actively seek and evaluate a number of property development opportunities and further
information will be made available to the market in accordance with its continuous disclosure obligations under the ASX
Listing Rules.
12) ENVIRONMENTAL ISSUES
The Company is not subject to any significant environmental regulation under the Commonwealth or State legislation.
The Board is not aware of any breach of environmental requirements as they apply to the Company.
7
Ultima United Limited - Annual Report
For the year ended 30 June 2017
DIRECTORS' REPORT
13) REMUNERATION REPORT
This Remuneration Report covers the following Key Management Personnel:
Directors
(Simon) Xing Yan
Eric Kong
(James) Zixi Ban (appointed 5 December 2016)
Piers Lewis (appointed 22 September 2016, resigned 5 December 2016)
George Lazarou (resigned 22 September 2016)
Other than the directors, the Company does not currently have any other employees. Executive directors and any
personnel in the senior management position are collectively referred to as executives in this Report.
Remuneration Policy
The remuneration policy of the Company has been designed to align directors’ and executives’ objectives with
shareholder and business objectives by providing a fixed remuneration component which is assessed on an annual
basis in line with market rates and offering specific long-term incentives based on key performance areas affecting the
Company’s financial results. The board believes the remuneration policy to be appropriate and effective in its ability to
attract and retain the best directors and executives to run and manage the Company. The board’s policy for determining
the nature and amount of remuneration for board members and executives of the Company is as follows:
Executive Remuneration Policy
The remuneration policy, setting the terms and conditions for the executive directors and other senior executives (or
collectively “executives”), was developed by the board. All executives receive a base salary (which is based on factors
such as length of service and experience) and superannuation. The board reviews executive packages annually by
reference to the Company’s performance, executive’s performance and comparable information from industry sectors
and other listed companies in similar industries.
The board may exercise discretion in relation to approving incentives, bonuses and options. The policy is to attract the
highest calibre of executives and reward them for performance that results in long-term growth in shareholder’s wealth.
Executives are also entitled to participate in the employee share and option arrangements. The executive directors
receive a superannuation guarantee contribution required by the government, which is currently 9.5% and do not
receive any other retirement benefits.
All remuneration paid to directors and executives is valued at the cost to the Company and expensed. Shares given to
directors and executives are valued as the difference between the market price of those shares and the amount paid
by the director or executive. Options are valued using the Black-Scholes method.
Non-Executive Remuneration Policy
The board’s policy is to remunerate non-executive directors at market rates for comparable companies for time,
commitment and responsibilities. The board determines payments to the non-executive directors and reviews their
remuneration annually, based on market practice, duties and accountability. Independent external advice is sought
when required. The maximum aggregate amount of fees that can be paid to non-executive directors is subject to
approval by shareholders at the Annual General Meeting, (currently $250,000). Fees for non-executive directors are
not linked to the performance of the Company. However, to align directors’ and executives’ interests with shareholder
interests, non-executive directors are encouraged to hold shares in the company and are able to participate in the
employee option plan.
Performance based remuneration
The Company has no performance based remuneration component built into executive remuneration packages. Non-
executive directors’ remuneration are not performance based.
Company performance, shareholder’s wealth and director’s and executive’s remuneration
The remuneration policy has been tailored to increase goal congruence between shareholders and directors and
executives. Currently, this is facilitated through the issue of options to the majority of directors and executives to
encourage the alignment of personal and shareholder interests. The Company believes the policy will be effective in
increasing shareholder’s wealth. For details of directors’ interests in options at year end, refer the Directors’ Report.
8
Ultima United Limited - Annual Report
For the year ended 30 June 2017
DIRECTORS' REPORT
Employment contracts of key management personnel
(Simon) Xing Yan
Pursuant to an agreement executed on 30 April 2015, Xing Yan will be paid $150,000 per annum plus superannuation,
for providing services to the Company as Executive Chairman & Managing Director. The agreement may be terminated
by either party by providing 1 month’s written notice and upon payment of any outstanding fees for services rendered.
The initial employment contract was for a term of 1 year, commencing 1 May 2015. On 30 April 2016, this contract was
extended by an additional year until 1 May 2017. On 28 April 2017, this contract was again extended by an additional
year until 1 May 2018.
Eric Kong
On 4 March 2011, a resolution was passed by board of directors to increase Mr Kong’s salary to $50,000 per annum.
Mr Kong’s appointment will automatically cease in the event that he gives notice to the board of his resignation as a
director, or he resigns by rotation and is not re-elected as a director by the shareholders of the Company.
(James) Zixi Ban (appointed 5 December 2016)
Pursuant to an agreement executed on 5 December 2016, Mr Ban is entitled to $5,000 per annum as a Non-Executive
Director. Mr Ban’s appointment will automatically cease in the event that he gives notice to the board of his resignation
as a director, or he resigns by rotation and is not re-elected as a director by the shareholders of the Company.
Piers Lewis (appointed 22 September 2016, resigned 5 December 2016)
Mr Lewis was appointed as Non-Executive Director on 22 September 2016 and was entitled to $30,000 per annum. Mr
Lewis resigned as Non-Executive Director on 5 December 2016.
George Lazarou (resigned 22 September 2016)
Pursuant to an agreement executed on 30 April 2015, George Lazarou will be paid $100,000 per annum plus
superannuation, for providing services to the Company as an Executive Director. The employment contract was for a
term of 1 year, commencing 1 May 2015. On 30 April 2016, this contract was extended by an additional one year until
1 May 2017. Mr Lazarou resigned as Non-Executive Director on 22 September 2016.
Compensation of Key Management Personnel for the year ended 30 June 2017
SHORT-TERM BENEFITS
POST EMPLOYMENT
SHARE-BASED
PAYMENT
TOTAL
Salary &
Fees
Cash
Bonus
Non-
Monetary
Super-
annuation
Long
Service
Equity
Options
2017
2016
Directors
(Simon) Xing Yan - Executive Chairman
150,000
150,000
Eric Kong - Non-Executive Director
50,000
50,000
2017
2016
-
-
-
-
(James) Zixi Ban - Non-Executive Director
2017
2016
2,917
-
-
-
Piers Lewis - Non-Executive Director
6,070
-
2017
2016
-
-
2017
2016
George Lazarou - Executive Director
47,935
100,000
Total Remuneration
256,922
300,000
2017
2016
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
14,250
14,250
4,151(1)
29,758(1)
4,750
4,750
-
-
-
-
-
-
-
-
-
-
2,375
9,500
-
2,774(2)
21,375
28,500
4,151
32,532
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
168,401
194,008
54,750
54,750
2,917
-
6,070
-
50,310
112,274
282,448
361,032
(1) As of 1 May 2016, Mr Yan had been employed with the Company for seven years. For the current financial year
$4,151 (2016: $29,758) has been expensed as long service leave.
(2) As of 1 June 2014, Mr Lazarou had been employed with the Company for seven years. Mr Lazarou resigned as
Non-Executive Director on 22 September 2016 and was paid his long service leave liability, therefore no outstanding
liability remains on the Statement of Financial Position at 30 June 2017. For the previous financial year $2,774 was
expensed as long service leave.
9
Ultima United Limited - Annual Report
For the year ended 30 June 2017
DIRECTORS' REPORT
Option holdings of key management personnel
2017
The Company’s Directors and key management personnel did not hold any options at 30 June 2017.
2016
The Company’s Directors and key management personnel did not hold any options at 30 June 2016.
Shareholdings of key management personnel
2017
(Simon) Xing Yan
Eric Kong
(James) Zixi Ban (1)
Piers Lewis
George Lazarou (2)
Feng Ding
TOTAL
Balance at
01.07.16
1,642,500
Granted as
Remuneration
-
On Exercise
of Options
-
35,775
10,000
-
779,750
-
2,468,025
-
-
-
-
-
-
-
-
-
-
-
-
Bought &
(Sold)
Balance at
30.06.17
-
-
-
-
-
-
-
1,642,500
35,775
10,000
-
779,750
-
2,468,025
(1) Shares were held at date of appointment.
(2) Shares were held at date of resignation.
2016
(Simon) Xing Yan
George Lazarou
Eric Kong
Feng Ding
TOTAL
Balance at
01.07.15
1,642,500
Granted as
Remuneration
-
On Exercise
of Options
-
Bought &
(Sold)
Balance at
30.06.16
-
1,642,500
157,500
35,775
-
1,835,775
-
-
-
-
-
-
-
-
622,250
-
-
779,750
35,775
-
622,250
2,458,025
Compensation options granted during the year ended 30 June 2017
No compensation options were granted to directors or executive during the financial year (2016: nil).
There are no compensation options in existence at reporting date.
Performance income as a proportion of total income
No performance based bonuses have been paid to directors or executives during the financial year (2016: nil).
Loans to key management personnel
There were no loans to or from key management personnel during the financial year (2016: nil).
Other transactions with key management personnel
On 29 November 2013, the Company received shareholder approval to enter into a Joint Venture and Profit Sharing
Agreement (Agreement) with S & A Holding (Aust) Pty Ltd (S & A Holding). Mr Simon Yan, a director of the Company,
is a shareholder and director of S & A Holding. Refer to Note 7 and 22 for further details of the Agreement.
END OF REMUNERATION REPORT
10
Level 15, Exchange Tower
2 The Esplanade
Perth, WA 6000
PO Box 5785, St Georges Terrace
WA 6831
T +61 (0)8 9225 5355
F +61 (0)8 9225 6181
www.moorestephens.com.au
AUDITOR’S INDEPENDENCE DECLARATION
UNDER S307C OF THE CORPORATIONS ACT 2001
TO THE DIRECTORS OF ULTIMA UNITED LIMITED
I declare that, to the best of my knowledge and belief, during the year ended 30 June 2017 there have
been no contraventions of:
i.
the auditor independence requirements as set out in the Corporations Act 2001 in relation to the
audit; and
ii. any applicable code of professional conduct in relation to the audit.
Suan-Lee Tan
Partner Chartered Accountants
Moore Stephens
Dated this 31st day of August 2017
Liability limited by a scheme approved under Professional Standards Legislation. Moore Stephens ABN 16 874 357 907. An independent
member of Moore Stephens International Limited - members in principal cities throughout the world. The Perth Moore Stephens firm is not a
partner or agent of any other Moore Stephens firm.
12
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
Ultima United Limited - Annual Report
For the year ended 30 June 2017
Interest revenue
Share of profit in Joint Venture
Employee benefit expenses
Occupancy expenses
Depreciation expense
Consultancy expenses
Legal and compliance expenses
Net gain/(loss) on financial assets held at fair value
Impairment loss on property development
Holding costs relating to unsold properties
Administration expenses
Loss before income tax expense
Income tax expense
Net loss for the year
Other comprehensive Income
Total comprehensive income for the year
Notes
30-Jun-17
30-Jun-16
$
$
1,883
30,761
7,824
87,560
(248,495)
(356,550)
7
2
(42,164)
(1,016)
(41,500)
(41,001)
519
2
(772,326)
-
(55,220)
(1,548)
(41,200)
(42,476)
(3,805)
-
(987)
(10,423)
(10,257)
(1,123,762)
(416,659)
4
-
-
(1,123,762)
(416,659)
-
-
(1,123,762)
(416,659)
Basic and diluted loss per share (cents per share)
20
(4.41)
(1.63)
The accompanying notes form part of these financial statements.
13
STATEMENT OF FINANCIAL POSITION
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Property development - Interest in Joint Venture
TOTAL CURRENT ASSETS
NON CURRENT ASSETS
Property development
Financial assets
Plant and equipment
TOTAL NON CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Provision
Borrowings
TOTAL CURRENT LIABILITIES
NON CURRENT LIABILITIES
Borrowings
TOTAL NON CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
Ultima United Limited - Annual Report
As at 30 June 2017
Notes
30-Jun-17
30-Jun-16
$
$
5
6
7
8
9
10
11
12
13
13
14
15
16
1,117,853
1,375,502
7,487
8,200
-
256,329
1,125,340
1,640,031
2,298,756
2,932,040
5,188
1,171
4,669
2,187
2,305,115
2,938,896
3,430,455
4,578,927
83,530
62,081
48,389
30,062
91,883
48,389
194,000
170,334
848,235
848,235
896,611
896,611
1,042,235
1,066,945
2,388,220
3,511,982
7,714,827
7,714,827
482,267
482,267
(5,808,874)
(4,685,112)
2,388,220
3,511,982
The accompanying notes form part of these financial statements.
14
STATEMENT OF CHANGES IN EQUITY
Ultima United Limited - Annual Report
For the year ended 30 June 2017
Issued
Capital
Option
Reserves
Accumulated
Losses
$
$
$
Total
$
Balance at 1 July 2015
Loss for the year
Other comprehensive income
Total comprehensive income for the year
7,714,827
482,267
(4,268,453)
3,928,641
-
-
-
-
-
-
(416,659)
(416,659)
-
-
(416,659)
(416,659)
Balance at 30 June 2016
7,714,827
482,267
(4,685,112)
3,511,982
Balance at 1 July 2016
Loss for the year
Other comprehensive income
Total comprehensive income for the year
7,714,827
482,267
(4,685,112)
3,511,982
-
-
-
-
-
(1,123,762)
(1,123,762)
-
-
-
(1,123,762)
(1,123,762)
Balance at 30 June 2017
7,714,827
482,267
(5,808,874)
2,388,220
The accompanying notes form part of these financial statements
15
STATEMENT OF CASH FLOWS
Cash flows from operating activities
Payments to suppliers and employees
Interest and other income
Deposit paid
Net cash used in operating activities
Cash flows from investing activities
Joint venture - property development
Joint venture - sale of property proceeds
Payment for property development
Net cash provided by / (used in) investing activities
Cash flows from financing activities
Proceeds from the issue of shares, net of costs
Repayment of borrowings
Net cash provided by / (used in) investing activities
Net decrease in cash and cash equivalents held
Cash and cash equivalents at beginning of financial year
Ultima United Limited - Annual Report
For the year ended 30 June 2017
Notes
30-Jun-17
30-Jun-16
$
$
(354,160)
(625,705)
1,883
(5,044)
10,892
-
21
(357,321)
(614,813)
(14,153)
301,243
(63,352)
646,605
(139,042)
(1,461,611)
148,048
(878,358)
-
945,000
(48,376)
(48,376)
-
945,000
(257,649)
(548,171)
1,375,502
1,923,673
Cash and cash equivalents at end of financial year
5
1,117,853
1,375,502
.
The accompanying notes form part of these financial statements
16
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
The financial report is a general purpose financial report that has been prepared in accordance with Australian
Accounting Standards including Australian Accounting Interpretations, other authoritative pronouncements of the
Australian Accounting Standards Board and the Corporations Act 2001. The Company is a for-profit entity for financial
reporting purposes under Australian Accounting Standards.
The financial report covers the Company of Ultima United Limited and has been prepared in Australian dollars. Ultima
United Limited is a listed public company, incorporated and domiciled in Australia.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial
report containing relevant and reliable information about transactions, events and conditions to which they apply.
Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with
International Financial Reporting Standards.
The following is a summary of the material accounting policies adopted by the entity in the preparation of the financial
report. The accounting policies have been consistently applied, unless otherwise stated.
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, financial assets and financial liabilities for which the fair value basis of accounting has
been applied.
(a) Critical Accounting Judgements, Estimates and Assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of
future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the
carrying amounts of certain assets and liabilities within the next annual reporting period are:
Share based payment transactions
The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the
equity instruments at the date at which they are granted. The fair value is determined by an internal valuation using
Black-Scholes option pricing model.
Impairment
The Company assesses impairment at the end of each reporting period by evaluating conditions and events specific
to the Company that may be indicative of impairment triggers. Recoverable amounts of relevant assets are reassessed
using value-in-use calculations which incorporate various key assumptions.
Environmental Issues
Balances disclosed in the financial statements and notes thereto are not adjusted for any pending or enacted
environmental legislation, and the directors understanding thereof. At the current stage of the Company’s development
and its current environmental impact the directors believe such treatment is reasonable and appropriate.
Taxation
Balances disclosed in the financial statements and the notes thereto, related to taxation, and are based on the best
estimates of directors. These estimates take into account both the financial performance and position of the company
as they pertain to current income taxation legislation, and the directors understanding thereof. No adjustment has been
made for pending or future taxation legislation. The current income tax position represents that directors’ best estimate,
pending an assessment by the Australian Taxation Office.
(b) Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the
revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is
recognised:
Interest
Revenue is recognised as the interest accrues.
(c) Earnings Per Share
The Company presents basic and diluted earnings per share (“EPS”) data for its ordinary shares. Basic EPS is
calculated by dividing the net profit or loss attributable to members for the reporting period, after excluding any costs
of servicing equity, by the weighted average number of ordinary shares of the Company, adjusted for any bonus issue.
Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average
number of ordinary shares outstanding.
17
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
(d) Impairment of Assets
At each reporting date the Company assesses whether there is any indication that an asset may be impaired. Where
an indication of impairment exists, the Company makes a formal estimate of recoverable amount. Where carrying
amount of an asset exceeds its recoverable amount the asset is considered impaired and is written down to its
recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. It is determined for an individual
asset, unless the asset’s value in use cannot be estimated to be close to its fair value less costs to sell and it does not
generate cash inflows that are largely independent of those from other assets or Company assets, in which case, the
recoverable amount is determined for the cash-generating unit to which the asset belongs.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset.
(e) Income Tax
Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets
and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences:
• except where the deferred income tax liability arises from the initial recognition of an asset or liability in a
transaction that is not a business combination and, at the time of the transaction, affects neither that accounting
profit or loss nor taxable profit or loss; and
•
in respect of taxable temporary differences associated with investments in subsidiaries, associates and interests
in joint ventures, except where the timing of the reversal of the temporary differences will not reverse in the
foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets
and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences, and the carry-forward of unused tax assets and unused tax losses can be utilised:
• except where the deferred income tax asset relating to the deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profit or loss nor taxable profit or loss; and
•
in respect of deductible temporary differences with investments in subsidiaries, associates and interests in joint
ventures, deferred tax assets are only recognised to the extent that it is probable that the temporary differences
will reverse in the foreseeable future and taxable profit will be available against which the temporary differences
can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent
that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax
asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted at the balance sheet date.
(f) 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 (“ATO”). 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.
The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability in the
Statement of Financial Position.
Cash flows are included in the Statement of Cash Flows on a gross basis. The GST components of cash flows arising
from investing and financing activities which are recoverable from, or payable to, the ATO are classified as operating
cash flows.
18
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
(g) Cash and cash equivalents
Cash and cash equivalents include 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 are shown within
short-term borrowings in current liabilities on the Statement of Financial Position.
(h) Trade and Other Receivables
Trade receivables, which generally have 30-90 day terms, are recognised and carried at original invoice amount less
an allowance for any uncollectible amounts. An allowance for doubtful debts is made when there is objective evidence
that the Company will not be able to collect the debts. Bad debts are written off when identified.
Receivables from related parties are recognised and carried at the nominal amount due. Interest is taken up as income
on an accrual basis.
(i) Interest in Joint Venture (Equity Accounted Investee)
These are investments where the Company has joint control, established by contractual agreement and requiring
unanimous consent for strategic and operating decisions. Such investments are accounted for using the equity method
(Equity Accounted Investees) and are initially recognised at cost under AASB 11 Joint Arrangements. The financial
statements include the Company’s share of the income and expenses and equity movements of Equity Accounted
Investees, after adjustments to align the accounting policies with those of the Company, from the date that the joint
control commences until the date joint control ceases. When the Company’s share of losses exceeds its interest in an
Equity Accounted Investee, the carrying amount of that interest is reduced to nil and the recognition of further losses is
discontinued except to the extent that the Company has an obligation or has made payments on behalf of the Equity
Accounted Investee. Such investments are carried at the lower of the equity accounted amount and the recoverable
amount. Investments in joint ventures are treated as current assets where it is expected that the investment will be
realised within a twelve month time frame.
(j) Property held for development and resale
Property held for development and resale comprises land held for development, contract costs and other holding costs
incurred to date.
Costs include the cost of acquisition, development, interest on funds borrowed for the development and holding costs
until completion of the development. Interest and holding charges incurred after development is completed are
expensed. Profit is recognised on an individual contract basis generally at settlement.
(k) Plant and Equipment
Plant and equipment are measured on the cost basis. The carrying amount of plant and equipment is reviewed annually
by directors to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is
assessed on the basis of the expected net cash flows that will be received from the asset’s employment and subsequent
disposal. The expected net cash flows have been discounted to their present values in determining recoverable
amounts.
Depreciation
The depreciable amount of plant and equipment is depreciated on a diminishing value basis over the asset’s useful life
to the Company commencing from the time the asset is held ready for use.
The depreciation rates used for each class of depreciable assets are:
Class of Fixed Asset
Plant and equipment
Furniture and Fittings
Software
Depreciation Rate
33.00%
11.25%
33.00%
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date. An
asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater
than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with the
carrying amount. These gains and losses are included in the Statement of Profit or Loss and Other Comprehensive
Income. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are
transferred to retained earnings.
(l) Trade and Other Payables
Liabilities for trade creditors and other amounts are carried at cost which is the fair value of consideration to be paid in
the future for goods and services received, whether or not billed to the Company.
Payables to related parties are carried at the principal amount. Interest, when charged by the lender, is recognised as
an expense on an accrual basis.
19
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
(m) Issued Capital
Ordinary shares are classified as equity.
Any transaction costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the
share proceeds received.
(n) Financial Instruments
Recognition and initial measurement
Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions
to the instrument. For financial assets, this is equivalent to the date that the company commits itself to either the
purchase or sale of the asset (ie trade date accounting is adopted).
Financial instruments are initially measured at fair value plus transaction costs, except where the instrument is classified
‘at fair value through profit or loss’, in which case transaction costs are expensed to profit or loss immediately.
Classification and subsequent measurement
Financial instruments are subsequently measured at either of fair value, amortised cost using the effective interest rate
method, or cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, between
knowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair value.
In other circumstances, valuation techniques are adopted.
Amortised cost is calculated as:
(a)
(b)
(c)
the amount at which the financial asset or financial liability is measured at initial recognition;
less principal repayments;
plus or minus the cumulative amortisation of the difference, if any, between the amount initially recognised
and the maturity amount calculated using the effective interest method; and
less any reduction for impairment.
(d)
The effective interest method is used to allocate interest income or interest expense over the relevant period and is
equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees, transaction
costs and other premiums or discounts) through the expected life (or when this cannot be reliably predicted, the
contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability.
Revisions to expected future net cash flows will necessitate an adjustment to the carrying value with a consequential
recognition of an income or expense in profit or loss.
The Company does not designate any interests in subsidiaries, associates or joint venture entities as being subject to
the requirements of accounting standards specifically applicable to financial instruments.
(i) Financial assets at fair value through profit or loss
Financial assets are classified at ‘fair value through profit or loss’ when they are either held for trading for the
purpose of short-term profit taking, derivatives not held for hedging purposes, or when they are designated as
such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is
managed by key management personnel on a fair value basis in accordance with a documented risk management
or investment strategy. Such assets are subsequently measured at fair value with changes in carrying value being
included in profit or loss.
(ii) Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or
determinable payments, and it is the Company’s intention to hold these investments to maturity. They are
subsequently measured at amortised cost.
Held-to-maturity investments are included in non-current assets, except for those which are expected to mature
within 12 months after the end of the reporting period. (All other investments are classified as current assets.)
If during the period the Company sold or reclassified more than an insignificant amount of the held-to-maturity
investments before maturity, the entire held-to-maturity investments category would be tainted and reclassified
as available-for-sale.
(iii) Available-for-sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are either not suitable to be classified
into other categories of financial assets due to their nature, or they are designated as such by management. They
comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed or determinable
payments.
Available-for-sale financial assets are included in non-current assets, except for those which are expected to
mature within 12 months after the end of the reporting period. (All other financial assets are classified as current
assets).
20
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
(iv) Financial liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost.
Fair value
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to
determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to similar
instruments and option pricing models.
Impairment
At the end of each reporting period, the Company assesses whether there is objective evidence that a financial
instrument has been impaired. In the case of available-for-sale financial instruments, a prolonged decline in the value
of the instrument is considered to determine whether a impairment has arisen. Impairment losses are recognised in the
statement of profit or loss and other comprehensive income.
De-recognition
Financial assets are de-recognised where the contractual rights to receipt of cash flows expires or the asset is
transferred to another party whereby the entity no longer has any significant continuing involvement in the risks and
benefits associated with the asset. Financial liabilities are de-recognised where the related obligations are discharged,
cancelled or expired. The difference between the carrying value of the financial liability extinguished or transferred to
another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed,
is recognised in profit or loss.
Impairment of Assets
At each the end of each reporting period, the Company assesses whether there is any indication that an asset may be
impaired. The assessment will include the consideration of external and internal sources of information including
dividends received from subsidiaries, associates or jointly controlled entities deemed to be out of pre-acquisition profits.
If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the
asset, being the higher of the asset’s fair value less costs to sell and value in use, to the asset’s carrying value. Any
excess of the asset’s carrying value over its recoverable amount is expensed to the statement of comprehensive
income.
Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the
recoverable amount of the cash-generating unit to which the asset belongs.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.
(o) Comparatives
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
(p) Employee Benefits
Provision is made for the company’s liability for employee benefits arising from services rendered by employees to
balance date. Employee benefits that are expected to be settled within 1 year have been measured at the amounts
expected to be paid when the liability is settled. Employee benefits payable later than 1 year have been measured at
the present value of the estimated future cash outflows to be made for those benefits. Those cashflows are discounted
using market yields on national government bonds with terms to maturity that match the expected timing of cashflows.
21
NOTES TO THE FINANCIAL STATEMENTS
(q) New Accounting Standards for Application in Future Periods
Accounting Standards issued by the AASB that are not yet mandatorily applicable to the company, together with an
assessment of the potential impact of such pronouncements on the company when adopted in future periods, are
discussed below:
Ultima United Limited - Annual Report
For the year ended 30 June 2017
AASB No.
Title
AASB 9
Financial Instruments
Application
date of
standard *
Issue
date
1 January 2018 December 2014
AASB 2010-7
Amendments arising from Accounting Standards arising from AASB 9
(December 2010)
1 January 2018 September 2012
AASB 2014-1
Amendments to Australian Accounting Standards
Part E - Financial Instruments
Part E -
1 January 2018
June 2014
AASB 2014-5 Amendments to Australian Accounting Standard Arising From AASB 15
1 January 2018 December 2014
AASB 2014-7
Amendments to Australian Accounting Standard Arising From AASB 9
(December 2014)
1 January 2018 December 2014
AASB 2014-10
Amendments to Australian Accounting Standard - Sale of Contribution of
Assets Between Investors and its Associates or Joint Venture
1 January 2018 December 2014
AASB 2015-8 Amendments to Australian Accounting Standards - Effective Date of AASB 15 1 January 2018 October 2015
AASB 2015-10
Amendments to Australian Accounting Standards - Effective Date of
Amendments to AASB 10 and AASB 128.
1 January 2018 December 2015
AASB 2016-1
Amendments to Australian Accounting Standards - Recognition of Deferred
Tax Assets for Unrealised Losses [AASB 112]
1 January 2017 February 2016
AASB 2016-2
Amendments to Australian Accounting Standards - Disclosure Initiative:
Amendments to AASB 107
1 January 2017 March 2016
AASB 2016-3 Amendments to Australian Accounting Standards - Clarifications to AASB 15 1 January 2018
May 2016
AASB 15
Revenues from Contracts with Customers
1 January 2018 October 2015
AASB 16
Leases
1 January 2019 February 2016
The directors’ assessment is that there would be no material impact arising from the above standards given the current
stage of the company’s’ operations.
The financial report was authorised for issue on 31st of August 2017 by the board of directors.
22
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
NOTE 2: LOSS FOR THE YEAR
Loss before income tax has been determined after following specific expenses:
Employee benefits expense
- Salaries and entitlements
- Long service leave
30-Jun-17
30-Jun-16
$
$
252,666
(4,171)
248,495
324,017
32,533
356,550
Impairment loss on property development
772,326
-
NOTE 3: AUDITORS’ REMUNERATION
Remuneration of the auditor for:
- Auditing or reviewing the financial report
- Other professional services
NOTE 4: INCOME TAX EXPENSE
(a) The components of tax expense comprise:
Current tax
Deferred tax
30-Jun-17
30-Jun-16
$
$
16,523
5,500
22,023
16,607
5,200
21,807
30-Jun-17
30-Jun-16
$
$
-
-
-
-
-
-
(b) The prima facie tax benefit on loss from ordinary activities before income
tax is reconciled to the income tax as follows:
Prima facie tax benefit on loss from ordinary activities before income tax at 27.5%
(2016: 30%)
(309,035)
(124,998)
Add tax effect of:
- Revenue losses not recognised
- Other assessable items
- Other deferred tax balances not recognised
Income tax expense
186,238
124,093
4,442
118,355
-
-
905
-
23
NOTES TO THE FINANCIAL STATEMENTS
(c) Deferred tax recognised at 27.5% (2016:30%) (Note 1):
Deferred tax liabilities:
Property development – Interest in Joint Venture
Property development
Deferred tax assets:
Carry forward revenue losses
Net deferred tax
(d) Unrecognised deferred tax assets at 27.5% (2016:30%) (Note 1):
Carry forward revenue losses
Property development
Carry forward capital losses
Financial assets
Capital raising costs
Provision and accruals
Other
Ultima United Limited - Annual Report
For the year ended 30 June 2017
30-Jun-17
30-Jun-16
$
$
-
-
-
-
(1,027)
(7,568)
8,595
-
1,226,477
1,208,935
203,892
13,750
96,521
13,850
21,486
1,848
-
15,000
105,452
22,663
32,793
3,184
1,577,824
1,388,027
The tax benefits of the above deferred tax assets will only be obtained if:
(a)
the Company derives future assessable income of a nature and of an amount sufficient to enable the benefits to
be utilised;
(b)
the Company continues to comply with the conditions for deductibility imposed by law; and
(c) no changes in income tax legislation adversely affect the Company in utilising the benefits.
Note 1 - the corporate tax rate for eligible companies will reduce from 30% to 25% by 30 June 2027 providing certain
turnover thresholds and other criteria are met. Deferred tax assets and liabilities are required to be measured at the tax
rate that is expected to apply in the future income year when the asset is realised or the liability is settled. The Directors
have determined that the deferred tax balances be measured at the tax rates stated.
NOTE 5: CASH AND CASH EQUIVALENTS
Current
Cash at Bank
NOTE 6: TRADE AND OTHER RECEIVABLES
Current
GST Receivable
Accrued interest
Prepayments
24
30-Jun-17
30-Jun-16
$
$
1,117,853
1,375,502
30-Jun-17
30-Jun-16
$
$
2,443
5,044
-
7,487
2,698
-
5,502
8,200
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
NOTE 7: INTERESTS IN JOINT VENTURE
On 29 November 2013, the Company received shareholder approval to enter into a Joint Venture and Profit Sharing
Agreement between S & A Holding (Aust) Pty Ltd (“S & A Holding”) and the Company to develop the property at 295
Canning Highway, Como (“Como Property”). Mr Simon Yan, the managing director of the Company, is a director and
shareholder of S & A Holding.
Under the terms of the agreement, S & A Holding and the Company formed an unincorporated joint venture for the
purpose of sharing profits from the completion of the Como Property development. Council approval for the
development was received on 10 July 2014 with the construction commencing thereafter.
At 30 June 2017, the Company had incurred total minimum expenditure to earn the following interest in the JV profits:
(a) S & A Holding – 50%; and
(b) the Company – 50%.
Each party must now contribute to expenditure made or incurred in respect of the Como Property development in
proportion to their interest in the profits or the Joint Venture (i.e. 50/50).
Under the JV Agreement, the liability of the parties in each case is several in proportion to their respective interests in
the profits of the Joint Venture and shall not be either joint or joint and several.
In accordance with AASB11, this interest is Equity Accounted and information about this Joint Venture is presented
below:
Place of
Business /
Name
Incorporation Classification
Interest in Como Joint
Venture Property
Development
Perth,
Australia
Joint
Venture
Proportion
of Interests
Measurement
Method
Carrying
Amount
2017
%
2016
%
50
50
2017
$
2016
$
-
256,329
Equity
Method
Set out below is the summarised financial information for the Joint Venture. Unless otherwise stated, the disclosed
information reflects the amounts presented in the Australian Accounting Standards financial statements of the Joint
Venture. The following summarised financial information, however, reflects the adjustments made by the Company
when applying the equity method. This Joint Venture has the same financial year end as the Company.
Following the sale of the last townhouse unit during the financial year, this Joint Venture has been terminated.
Summarised Financial Position
Current assets
Non-current assets
Current liabilities
Non-current liabilities
NET ASSETS
Company’s Share
Company’s Share of joint venture’s net assets
Como Property
Development Joint Venture
30-Jun-17
30-Jun-16
$
$
-
-
-
-
-
512,873
-
(215)
-
512,658
50%
50%
-
256,329
25
NOTES TO THE FINANCIAL STATEMENTS
Ultima United Limited - Annual Report
For the year ended 30 June 2017
Summarised Financial Performance
Income - Profit on sale of properties
Expenses
Income tax expense
Net profit after tax
Company’s Share
Company’s Share of joint venture’s net profit after tax
Reconciliation to Carrying Amounts
Company’s share of joint venture’s opening net assets
Investments during the year
Group’s share of joint venture’s net profit after tax
Distributions received during the year
Closing carrying amount of investment in joint venture
NOTE 8: PROPERTY DEVELOPMENT
Costs carried forward in respect of properties of interest in:
At the beginning of the financial year
Additions during the year
Impairment loss on property development
Non-current balance at reporting date
Como Property
Development Joint Venture
30-Jun-17
30-Jun-16
$
$
61,522
175,120
-
-
-
-
61,522
175,120
50%
30,761
50%
87,560
256,329
752,022
14,153
30,761
63,352
87,560
(301,243)
(646,605)
-
256,329
30-Jun-17
30-Jun-16
$
$
2,932,040
1,470,429
139,042
1,461,611
(772,326)
-
2,298,756
2,932,040
The above balance relates to the property developments located at 3 Oak Street, Cannington and 19-21 Tate Street,
Bentley Western Australia.
NOTE 9: FINANCIAL ASSETS
Non-Current
Listed Shares at fair value
Total Financial assets at fair value through profit or loss
30-Jun-17
30-Jun-16
$
$
5,188
5,188
4,669
4,669
26
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
NOTE 10: PLANT AND EQUIPMENT
Plant and equipment at cost
Accumulated depreciation
Movements in carrying amounts
Plant and Equipment
Balance at beginning of the year
Depreciation expense
At reporting date
NOTE 11: TRADE AND OTHER PAYABLES
Trade creditors
Other creditors and accruals
Trade creditors are non-interest bearing and are normally settled on 30 day terms.
NOTE 12: PROVISIONS
Employee benefits
Long service leave
NOTE 13: BORROWINGS
CURRENT
Loan from financial institution (i)
NON-CURRENT
Loan from financial institution (i)
Total Borrowings
(i) Terms and conditions
30-Jun-17
30-Jun-16
$
$
28,208
28,208
(27,037)
(26,021)
1,171
2,187
2,187
(1,016)
1,171
3,735
(1,548)
2,187
30-Jun-17
30-Jun-16
$
$
62,874
20,656
83,530
4,559
25,503
30,062
30-Jun-17
30-Jun-16
$
$
28,172
33,909
62,081
36,979
54,904
91,883
30-Jun-17
30-Jun-16
$
$
48,389
48,389
48,389
48,389
848,235
896,611
848,235
896,611
896,624
945,000
Loan Type: Variable Rate Interest Only (100% offset),
Loan Term: 30 Years,
Interest Rate: 4.70% per annum,
Security: Registered Mortgage over property situated at 19 and 21 Tate Street Bentley WA 6102,
-
-
-
-
- Covenants: There are no covenants to be complied with.
27
NOTES TO THE FINANCIAL STATEMENTS
NOTE 14: ISSUED CAPITAL
Ultima United Limited - Annual Report
For the year ended 30 June 2017
30-Jun-17
30-Jun-16
$
$
25,500,652 (30 June 2016: 25,500,652) fully paid ordinary shares of no par value
7,714,827
7,714,827
(a) Movements in fully paid ordinary shares on issue:
At the beginning of the year
At reporting date
30-Jun-17
30-Jun-16
$
Number
$
Number
7,714,827
25,500,652
7,714,827
25,500,652
7,714,827
25,500,652
7,714,827
25,500,652
(b) Terms of Ordinary Shares
Ordinary shares participate in dividends and the proceeds on winding up of the Company in proportion to the number
of shares held and in proportion to the amount paid up on the shares held.
At shareholders meetings each ordinary share is entitled to one vote in proportion to the paid up amount of the share
when a poll is called, otherwise each shareholder has one vote on a show of hands.
(c) Capital risk management
The Company’s objectives when managing capital are to safeguard its ability to continue as a going concern, so that it
may continue to provide returns for shareholders and benefits for other stakeholders.
Given the former nature of the Company’s activities in mineral exploration, it does not have ready access to credit
facilities, with the primary source of funding being equity raisings. Accordingly, the objective of the Company’s capital
risk management was to balance its working capital position against the requirements of the Company to meet
exploration programmes and overheads. This was achieved by maintaining appropriate liquidity to meet anticipated
operating requirements, with a view to initiating appropriate capital raisings as required. With the Company changing
its principal activities to property development, the Company’s capital risk management remains largely unchanged by
maintaining appropriate liquidity to meet anticipated development costs in conjunction with obtaining credit facilities
and through sales of properties development.
The working capital position of the Company at 30 June 2017 and 30 June 2016 are as follows:
Cash and cash equivalents
Trade and other receivables
Financial assets
Trade and other payables
Provisions
Working capital position
2017
$
2016
$
1,117,853
1,375,502
7,487
5,188
(83,530)
(62,081)
8,200
4,669
(30,062)
(91,883)
984,917
1,266,426
28
NOTES TO THE FINANCIAL STATEMENTS
NOTE 15: RESERVES
Option Reserve
Movements in options on issue:
At the beginning of the year
At reporting date
NOTE 16: ACCUMULATED LOSSES
Balance at beginning of the year
Net loss attributable to members
At reporting date
Ultima United Limited - Annual Report
For the year ended 30 June 2017
30-Jun-17
30-Jun-16
$
$
482,267
482,267
30-Jun-17
30-Jun-16
$
Number
$
Number
482,267
482,267
-
-
482,267
482,267
-
-
30-Jun-17
30-Jun-16
$
$
(4,685,112)
(4,268,453)
(1,123,762)
(416,659)
(5,808,874)
(4,685,112)
NOTE 17: KEY MANAGEMENT PERSONNEL DISCLOSURES
Refer to the remuneration report contained in the directors’ report for details of the remuneration paid or payable to
each member of the Company’s key management personnel (‘KMP’) for the year ended 30 June 2017.
Compensation of key management personnel by individual
Compensation details of key management personnel have been disclosed in the Directors’ Report. The totals of
remuneration paid to key management personnel of the Company during the year are as follows:
Salary and fees
Superannuation
Long service leave
30-Jun-17
30-Jun-16
$
$
256,922
21,375
4,151
300,000
28,500
32,533
282,448
361,033
Short-term employee benefits
These amounts include fees and benefits paid to the non-executive Chair and non-executive directors as well as all
salary, paid leave benefits, fringe benefits and cash bonuses awarded to executive directors and other KMP.
Post-employment benefits
These amounts are the current-year’s estimated cost of providing for the Company’s defined benefits scheme post-
retirement, superannuation contributions made during the year and post-employment life insurance benefits.
29
NOTES TO THE FINANCIAL STATEMENTS
NOTE 18: RELATED PARTY DISCLOSURE
Key management personnel
Disclosures relating to key management personnel are set out in the Directors’ Report.
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTE 19: FINANCIAL INSTRUMENTS
(i) FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company’s principal financial instruments comprise cash and short-term deposits. The main purpose of the
financial instruments is to earn the maximum amount of interest at a low risk to the Company. The Company also has
other financial instruments such as trade debtors and creditors which arise directly from its operations. For the year
under review, it has been the Company’s policy not to trade in financial instruments.
The directors’ overall risk management strategy seeks to assist the Company in meeting its financial targets, whilst
minimising potential adverse effects on financial performance.
Risk management policies are approved and reviewed by the Board of Directors on a regular basis. These include the
credit risk policies and future cash flow requirements.
Financial Risk Exposures and Management
The main risks arising from the Company’s financial instruments are interest rate risk and credit risk. The board reviews
and agrees policies for managing each of these risks and they are summarised below:
(a) Foreign Currency Risk
The Company is not exposed to fluctuations in foreign currencies.
(b)
Interest Rate Risk
The Company is exposed to movements in market interest rates on short term deposits. The policy is to monitor
the interest rate yield curve out to 120 days to ensure a balance is maintained between the liquidity of cash
assets and the interest rate return. The Company does not currently have short or long-term debt, and therefore
this risk is minimal.
(c) Credit Risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss
to the Company. The Company has adopted the policy of only dealing with credit worthy counterparties and
obtaining sufficient collateral or other security where appropriate, as a means of mitigating the risk of financial
loss from defaults.
The Company does not have any significant credit risk exposure to any single counterparty or any Company of
counterparties having similar characteristics. The carrying amount of financial assets recorded in the financial
statements, net of any provisions for losses, represents the Company’s maximum exposure to credit risk.
(d) Liquidity Risk
The Company manages liquidity risk by monitoring forecast cash flows. The Company does not have any
significant liquidity risk as the Company does not currently have any collateral debts.
(e) Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity
prices will affect the Company’s income or the value of its holdings of financial instruments. The objective of
market risk management is to manage and control market risk exposures within acceptable parameters, while
optimising the return.
30
NOTES TO THE FINANCIAL STATEMENTS
(ii) FINANCIAL INSTRUMENT COMPOSITION AND MATURITY ANALYSIS
The table below reflects the undiscounted contractual settlement terms for financial instruments of a fixed period of
maturity, as well as management’s expectations of the settlement period for all other financial instruments. As such,
the amounts might not reconcile to the Statement of Financial Position.
Ultima United Limited - Annual Report
For the year ended 30 June 2017
30 June 2017
Financial Assets
Cash and cash equivalents
Trade and other receivables
Financial assets
Weighted Average Interest Rate
Financial Liabilities
Trade and other creditors
Borrowings
30 June 2016
Financial Assets
Cash and cash equivalents
Trade and other receivables
Financial assets
Weighted Average Interest Rate
Financial Liabilities
Trade and other creditors
Borrowings
Fixed interest maturing in
over 1
year less
than 5
$
more
than 5
years
$
1 year or
less
$
Non-
Interest
bearing
$
Total
$
-
-
-
-
-
-
-
-
-
-
-
-
- 1,117,853
7,487
5,188
7,487
5,188
12,675 1,130,528
Floating
interest
rate
$
1,117,853
-
-
1,117,853
0.29%
-
-
-
-
-
-
83,530
83,530
48,389
193,556
654,679
-
896,624
48,389
193,556
654,679
83,530
980,154
Floating
interest
rate
$
1,375,502
-
-
1,375,502
0.47%
-
-
-
Fixed interest maturing in
over 1
year less
than 5
$
more
than 5
years
$
1 year or
less
$
-
-
-
-
-
-
-
-
-
-
Non-
Interest
bearing
$
Total
$
-
-
-
-
- 1,375,502
8,200
4,669
8,200
4,669
12,869 1,388,371
-
30,062
30,062
48,389
232,267
664,344
-
945,000
48,389
232,267
664,344
30,062
975,062
Trade and sundry payables are expected to be paid as follows:
Less than 6 months
2017
$
2016
$
83,530
83,530
30,062
30,062
(iii) FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES
The carrying amount of cash and cash equivalents approximates fair value because of their short-term maturity.
Listed investments have been valued at the quoted market bid price at balance date, adjusted for transaction costs
expected to be incurred. For unlisted investments where there is no organised financial market, the net fair value has
been based on a reasonable estimation of the underlying net assets or discounted cash flows of the investment.
Fair value of financial assets:
Bannerman Resources Limited
31
2017
$
2016
$
5,188
5,188
4,669
4,669
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
(iv) PRICE SENSITIVITY ANALYSIS
Management believes the estimated fair values resulting from the valuation of listed investments and recorded in the
statement of financial position and the related changes in fair values recorded in the statement of comprehensive
income are reasonable and the most appropriate at Statement of Financial Position date. At 30 June 2017, the effect
on loss as a result of changes in the share price of listed investment, with all other variables remaining constant would
be as follows:
CHANGE IN PROFIT/(LOSS)
Increase in fair value of investment by 10%
Decrease in fair value of investment by 10%
2017
$
2016
$
519
(519)
467
(467)
2017
Financial assets:
Level 1
Level 2
Level 3
Total
$
$
$
$
Financial assets at fair value through profit or loss:
—
listed investments
— unlisted investments
5,188
-
5,188
-
-
-
-
-
-
5,188
-
5,188
2016
Financial assets:
Level 1
Level 2
Level 3
Total
$
$
$
$
Financial assets at fair value through profit or loss:
—
listed investments
— unlisted investments
4,669
-
4,669
-
-
-
-
-
-
4,669
-
4,669
Included within Level 1 of the hierarchy are listed investments. The fair values of these financial assets have been
based on the closing quoted bid prices at reporting date, excluding transaction costs.
In valuing unlisted investments, included in Level 2 of the hierarchy, valuation techniques such as those using
comparisons to similar investments for which market observable prices are available have been adopted to determine
the fair values of these investments.
Derivative instruments are included in Level 3 of the hierarchy with the fair values being determined using valuation
techniques incorporating observable market data relevant to the hedged position.
NOTE 20: EARNINGS PER SHARE
2017
$
2016
$
(a) Loss used in the calculation of basic earnings per share
(1,123,762)
(416,659)
(b) Weighted average number of ordinary shares outstanding during the financial
year used in calculation of basic earnings per share
25,500,652
29,074,372
Number of
shares
Number of
shares
32
NOTES TO THE FINANCIAL STATEMENTS
NOTE 21: CASH FLOW INFORMATION
(i) Reconciliation of cash and cash equivalent:
Cash at Bank
Ultima United Limited - Annual Report
For the year ended 30 June 2017
2017
$
2016
$
1,117,853
1,375,502
(ii) Reconciliation of cash flows from operating activities with loss after income tax
Loss after income tax
Depreciation expense
Revaluation - financial assets at fair value
Profit on sale of investments
Impairment loss on property development
Changes in assets and liabilities:
- (Increase)/ Decrease in trade and other receivables
- (Decrease)/ Increase in trade and other payables
- (Decrease)/ Increase in provisions
Net cash used in operating activities
(1,123,762)
(416,659)
1,016
(519)
(30,761)
772,326
1,548
3,805
(87,560)
-
713
4,521
53,468
(148,245)
(29,802)
27,777
(357,321)
(614,813)
(iii) Non-cash financing and investing activities
No non-cash financing and investing activities have occurred during the year ended 30 June 2017.
NOTE 22: JOINT VENTURE AND PROFIT SHARING - PROPERTY DEVELOPMENT
On 29 November 2013, the Company received shareholder approval to enter into a Joint Venture and Profit Sharing
Agreement (Agreement) between S & A Holding (Aust) Pty Ltd (S & A Holding) and the Company. Summary of the
terms of the Agreement is as follows:
S & A Holding and the Company shall form an unincorporated joint venture forthwith upon this Agreement becoming
unconditional (Commencement Date) for the purpose of sharing profits from the completion of a turnkey development
of 3 double storey townhouses on the Property on the commercial terms set out in this Agreement and otherwise on
terms and conditions acceptable to both parties (Joint Venture). Under the terms of the Agreement, the commencement
date is subject to and conditional upon a number of conditions, including Council approval for the development. As
announced by the Company, Council approval was received on 10 July 2014, the deemed Commencement Date.
The parties acknowledge that S & A Holding’s initial cost in the Joint Venture will be the use of the Property (including
all development costs incurred in respect of the Property prior to execution of building agreement with Chessington
Homes, (an unrelated Perth home builder) which is valued at $650,000.
On the Commencement Date (and prior to the Company incurring any expenditure on the Joint Venture), the initial
interests of the parties in the profits of the Joint Venture will be:
(a) S & A Holding – 100%; and
(b) Ultima United Limited – 0%.
Subject to the commencement of the Joint Venture, the Company will have the right to earn an undivided interest in
the profits of the Joint Venture from S & A Holding up to a maximum of a 50% interest by incurring total expenditure of
$650,000 in connection with the development of the Property.
Upon the date the Company incurs total expenditure of $650,000, the interests of the parties in the profits of the Joint
Venture will be:
(a) S & A Holding – 50%; and
(b) Ultima United Limited – 50%.
The parties agree that from the Commencement Date until the date the Company earns a 50% interest in the profits of
the Joint Venture, the Company shall be solely responsible for all expenditure in respect of the development of the
Property (Sole Funding Period).
Upon the expiry of the Sole Funding Period, each party must contribute to expenditure made or incurred in respect of
the development of the Property in proportion to their then interest in the profits or the Joint Venture (i.e. 50/50).
Subject to the expenditure obligations of the Company during the Sole Funding Period under this Agreement, the
liability of the parties in each case is several in proportion to their respective interests in the profits of the Joint Venture
and shall not be either joint or joint and several.
Following the sale of the last townhouse unit during the financial year, this Joint Venture has been terminated.
33
Ultima United Limited - Annual Report
For the year ended 30 June 2017
NOTES TO THE FINANCIAL STATEMENTS
NOTE 23: SEGMENT INFORMATION
The Company has identified its operating segments based on the internal reports that are reviewed and used by the
Board of Directors in assessing performance and determining the allocation of resources.
The Company operates in one geographical and business segment being property development in Australia. All
segment assets, segment liabilities and segment results relate to the one segment and therefore no segment analysis
has been prepared.
NOTE 24: EVENTS SUBSEQUENT TO REPORTING DATE
On 14 July 2017, the Company received a loan proposal document from an Australian bank to fully fund the Oak Street
development. An announcement shall be made to the ASX once the loan terms are finalized and formally agreed to by
all stakeholders.
The directors are not aware of any other matters or circumstances that have arisen since the end of the financial year
which significantly affected or may significantly affect the operations of the Company, the results of those operations,
or the state of affairs of the Company in future financial years.
NOTE 25. CONTINGENT LIABILITIES
In the opinion of the directors there were no contingent liabilities at 30 June 2017, and the interval between 30 June
2017 and the date of this report.
NOTE 26: COMMITMENTS
(a) Lease expenditure commitments
There is one operating lease being a rental lease for the Company’s premises. The current amount payable is $917
plus GST per month exclusive of variable outgoings, with the rental lease expiring on 1 March 2019.
6 months
$
12 months
$
18 months
$
Total
$
Rental lease for the Company's premises
5,502
5,502
5,502
5,502
5,502
5,502
16,506
16,506
(b) Capital commitments
On 31 March 2017, the Company entered into a contract with a construction Company to develop the 3 Oak Street
Cannington property. The contract is conditional upon securing development funding. Subsequent to year-end, the
Company has received a loan proposal document from an Australian bank to fully fund the development. An
announcement shall be made to the ASX once the loan terms are finalised and formally agreed to by all stakeholders.
34
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF ULTIMA UNITED LIMITED
Report on the Audit of the Financial Report
Level 15, Exchange Tower,
2 The Esplanade, Perth, WA 6000
PO Box 5785, St Georges Terrace,
WA 6831
T +61 (0)8 9225 5355
F +61 (0)8 9225 6181
www.moorestephens.com.au
Opinion
We have audited the financial report of Ultima United Ltd (the “Company”) which comprises the statement of financial
position as at 30 June 2017, the statement of profit or loss and other comprehensive income, the statement of changes
in equity and the statement of cash flows for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Company is in accordance with the Corporations Act 2001,
including:
(i)
giving a true and fair view of the Company’s financial position as at 30 June 2017 and of its financial
performance for the year then ended; 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 those standards
are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Company 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.
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 year. 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.
.
36
Carrying value assessment for (Undeveloped) Property Assets
Refer to Note 8 - carrying value of $2.3 million
Assessing the carrying amount of the Company’s
interests in the (undeveloped) properties located at 3
Oak Street, Cannington and 19-21 Tate Street, Bentley,
Western Australia was a key audit matter. Factors
giving rise to this conclusion included the size of the
balance and the judgment required in the assessment
given the medium to long term nature of the asset,
particularly in relation to:
• whether development of these properties will
ultimately proceed. These vacant land were
purchased several years ago and development
applications
dwellings
(apartments) on these lots were granted by the
respective
However,
development plans have been placed on hold
due to the inability to secure project financing;
councils.
multiple
town
for
•
the current uncertain outlook of the Perth
the multiple-
property market especially
dwelling property segment which directly
influences the funding appetite of potential
lenders/investors.
We performed procedures over the assessment of the
(undeveloped) properties,
carrying values of
including with respect to whether the developments will
proceed, by updating our understanding of:
the
•
•
The progress and status of any ongoing and
anticipated negotiations taking place between the
Company’s
potential
funders/investors to finance the development and
likely timing.
directors
and
The state of the Perth apartment property market
and its future outlook based on available market
data/commentary and information sourced from
the public domain/industry publications.
Having updated our understanding of the above points,
we considered whether there were any indicators the
properties were impaired. This was also facilitated in
part by an independent market appraisal on the
properties obtained by the Directors during the year.
In addition to verifying that the impairment expense
recognised in the financial statements was considered
appropriate; we also undertook the following:
• Evaluated
the
independent
appraiser’s
competence, capabilities and objectivity;
• Assessed the appropriateness of the appraised
values by comparing against indicative market
values of similar properties (by location and size)
being advertised for sale from sources such as
www.realestate.com.au
• Reviewed the relevant disclosures contained in the
financial statements
37
Other Information
The directors are responsible for the other information. The other information comprises the information included in the
Company’s annual report for the year ended 30 June 2017, 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 that there is a material misstatement of this other information,
we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors 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 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.
In preparing the financial report, the directors are responsible for assessing the ability of the Company 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 Company or to cease operations, or has no realistic
alternative but to do so.
Auditor’s Responsibilities 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 the 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.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and
maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, international omissions,
misrepresentation, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial
report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the
Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and
whether the financial report represents the underlying transactions and events in a manner that achieves fair
presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
within the Company to express an opinion on the financial report. We are responsible for the direction, supervision
and performance of the Company audit. We remain solely responsible for our audit opinion.
38
We communicate with the directors regarding, among 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 these 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
communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report as included in the directors’ report for the year ended 30 June 2017.
In our opinion, the Remuneration Report of Ultima United Limited, for the year ended 30 June 2017 complies with
section 300A of the Corporations Act 2001.
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.
Suan Lee Tan
Partner
Moore Stephens
Chartered Accountants
Signed at Perth on the 31st day of August 2017
39
Ultima United Limited - Annual Report
For the year ended 30 June 2017
CORPORATE GOVERNANCE
This Corporate Governance summary discloses the extent to which the Company will follow the recommendations set
by the ASX Corporate Governance Council in its publication Corporate Governance Principles and Recommendations
(3rd Edition) (Recommendations). The Recommendations are not mandatory, however the Recommendations that will
not be followed have been identified and reasons have been provided for not following them.
The Company’s Corporate Governance Plan has been posted on the Company’s website at www.ultimaunited.com.au.
PRINCIPLES AND RECOMMENDATIONS
COMPLY
(YES/NO)
EXPLANATION
Principle 1: Lay solid foundations for management and oversight
Recommendation 1.1
A listed entity should have and disclose a charter
roles and
which sets out
responsibilities of the board, the chair and
management; and includes a description of
those matters expressly reserved to the board
and those delegated to management.
respective
the
Recommendation 1.2
A listed entity should:
(a) undertake appropriate checks before
appointing a person, or putting forward to
security holders a candidate for election, as
a director; and
(b) provide security holders with all material
information relevant
to a decision on
whether or not to elect or re-elect a director.
YES
YES
Recommendation 1.3
A listed entity should have a written agreement
with each director and senior executive setting
out the terms of their appointment.
YES
The Company has adopted a Board Charter.
the specific
The Board Charter sets out
responsibilities of the Board, requirements as to the
Boards composition, the roles and responsibilities of
the Chairman and Company Secretary,
the
establishment, operation and management of Board
Committees, Directors access to company records
and information, details of the Board’s relationship
with management, details of
the Board’s
performance review and details of the Board’s
disclosure policy.
A copy of the Company’s Board Charter is available
on the Company’s website.
(a) The Company has detailed guidelines for the
appointment and selection of the Board. The
Nomination Committee Charter requires the
Committee, and in this case the board as no
Committee currently exists due to the size of the
Company, to undertake appropriate checks
before appointing a person, or putting forward to
security holders a candidate for election, as a
director.
(b) All material information relevant to a decision on
whether or not to elect or re-elect a Director will
be provided to security holders in a Notice of
Meeting pursuant to which the resolution to elect
or re-elect a Director will be voted on.
The Nomination Committee Charter requires the
Committee, and in this case the board, as no
Committee currently exists due to the size of the
Company, to ensure that each director and senior
executive is a party to a written agreement with the
Company which sets out the terms of that Director’s
or senior executive’s appointment.
The Company has entered into Executive Service
Agreements with senior executives and Letters of
Appointment with each Non-Executive Director.
Recommendation 1.4
The company secretary of a listed entity should
be accountable directly to the board, through the
chair, on all matters to do with the proper
functioning of the board.
YES
The Board Charter outlines the roles, responsibility
and accountability of the Company Secretary. The
Company Secretary is accountable directly to the
board, through the chair, on all matters to do with the
proper functioning of the Board.
40
CORPORATE GOVERNANCE
Recommendation 1.5
A listed entity should:
(a) have a diversity policy which includes
YES
requirements for the board:
(i)
to set measurable objectives
achieving gender diversity; and
for
(ii) to assess annually both the objectives
and the entity’s progress in achieving
them;
Ultima United Limited - Annual Report
For the year ended 30 June 2017
(a) The Company has adopted a Diversity Policy
(i) The Diversity Policy provides a framework
for the Company to achieve a list of
measurable objectives
that encompass
gender equality.
(ii) The Diversity Policy provides
the
monitoring and evaluation of the scope and
currency of
the Diversity Policy. The
company is responsible for implementing,
monitoring and reporting on the measurable
objectives.
for
(b) disclose that policy or a summary or it; and
(b) The Diversity Policy is available on the company
website.
(c)
included
(i) The measurable objectives set by the board
will be
the annual key
in
performance indicators for the CEO, MD
and senior executives. In addition the board
will review progress against the objectives
in its annual performance assessment.
(ii)
(A) The board will include in the annual
report each year, the measurable
objectives, progress against
the
objectives, and the proportion of male
and female employees in the whole
organisation, at senior management
level and at Board Level. There are
female employees at senior
no
management or
the whole
in
organisation.
responsibilities of
(a) As the Board only consists of three (3)
members, the Company does not have a
Nomination Committee because it would not be
a more efficient mechanism than the full Board
for focusing the Company on specific issues.
The
the Nomination
Committee are currently carried out by the
board and evaluating the performance of the
Board, any committees and individual directors
on an annual basis. The Board may do so with
the aid of an independent advisor. The process
for this can be found in Schedule 6 of the
Company’s Corporate Governance Plan.
(b) The Company has established the Nomination
Committee Charter, which requires disclosure
as to whether or not performance evaluations
were conducted during the relevant reporting
period. During the period, over a series of
informal discussions, the Chairman reviewed the
performance of the Board members and the
Board members collectively
the
Chairman’s performance.
reviewed
(c) disclose as at the end of each reporting
period:
(i) the measurable objectives for achieving
gender diversity set by the board in
accordance with the entity’s diversity
policy and
towards
achieving them; and
its progress
(ii) either:
(A)
the respective proportions of men
and women on the board, in
senior executive positions and
the whole organisation
across
the entity has
(including how
defined
for
these purposes); or
“Gender Equality
the entity’s
Indicators”, as defined
the
Workplace Gender Equality Act
2012.
“senior executive”
in
(B)
Recommendation 1.6
A listed entity should:
(a) have and disclose a process for periodically
evaluating the performance of the board, its
committees and individual directors; and
YES
(b) disclose in relation to each reporting period,
whether a performance evaluation was
undertaken
in
in
accordance with that process.
the reporting period
41
Ultima United Limited - Annual Report
For the year ended 30 June 2017
(a) As the Board only consists of three (3)
members, the Company does not have a
Remuneration Committee because it would not
be a more efficient mechanism than the full
Board for focusing the Company on specific
issues.
the
Remuneration Committee are currently carried
out by the board, which includes evaluating the
performance of senior executives. The Board is
to arrange an annual performance evaluation of
the senior executives, and may do so with the
aid of an independent advisor.
responsibilities
The
of
(b) The
Schedule
Company
established
the
has
Remuneration Committee Charter, which
requires an annual performance of the senior
“Performance
executives.
Evaluation” requires disclosure as to whether or
not performance evaluations were conducted
during the relevant reporting period. During the
period, over a series of informal discussions, the
Board reviewed the performance of the senior
executives.
6
(b)
(a) As the Board only consists of three (3)
members, the Company does not have a
Nomination Committee because it would not be
a more efficient mechanism than the full Board
for focusing the Company on specific issues.
The responsibilities of a Nomination Committee
are currently carried out by the board.
The Company has adopted the Nomination
Committee Charter, which will be followed by
the Nomination Committee once it has been
established. The Charter provides that the
Committee:
(i) shall comprise of at least three (3) non-
executive directors, the majority of whom
are independent;
the Committee Chairman is to be an
independent Director.
(ii)
(iii) The Nomination Committee Charter
is
available online;
(iv) The Board Charter provides
the
disclosure of
the members of each
Committee. Details of the members of each
Committee are provided in Annual Report;
and
for
(v) The Board Charter
times
requires
each
Committee in relation to the reporting period
relevant to that Committee, to disclose the
number of
that Committee met
throughout the period, and the individual
attendances of the members at those
Committee meetings. Details of
the
performance evaluations conducted will be
provided in the Company’s Annual Report.
CORPORATE GOVERNANCE
Recommendation 1.7
A listed entity should:
YES
(a) have and disclose a process for periodically
evaluating the performance of its senior
executives; and
(b) disclose in relation to each reporting period,
whether a performance evaluation was
undertaken
in
in
accordance with that process.
the reporting period
Principle 2: Structure the board to add value
Recommendation 2.1
The board of a listed entity should:
NO
(a) have a nomination committee which:
(i)
(ii)
(iii)
(iv)
(v)
least
has at
three members, a
majority of whom are independent
directors; and
is chaired by an independent director,
and disclose:
the charter of the committee;
the members of the committee; and
as at the end of each reporting period,
the number of times the committee
met throughout the period and the
individual
the
of
attendances
members at those meetings; or
(b) if it does not have a nomination committee,
disclose that fact and the processes it
employs
to address board succession
issues and to ensure that the board has the
appropriate balance of skills, experience,
independence and knowledge of the entity
to enable it to discharge its duties and
responsibilities effectively.
42
CORPORATE GOVERNANCE
Recommendation 2.2
A listed entity should have and disclose a board
skill matrix setting out the mix of skills and
diversity that the board currently has or is looking
to achieve in its membership.
Ultima United Limited - Annual Report
For the year ended 30 June 2017
Board Skills Matrix
YES
Number of
Directors
that meet
the skill
Executive & Non-Executive
experience
Industry experience & knowledge
Leadership
Corporate governance & risk
management
Strategic thinking
Desired behavioural competencies
Geographic experience
Capital Markets experience
Subject matter expertise
- accounting
- capital management
- corporate financing
- industry taxation (1)
- risk management
- legal
- IT expertise (2)
2
3
3
2
3
3
3
2
2
2
2
0
2
2
0
(1) Skill gap noticed however an external taxation firm is
employed to maintain taxation requirements.
(2) Skill gap noticed however an external IT firm is
IT
to maintain
employed on an adhoc basis
requirements.
Recommendation 2.3
A listed entity should disclose:
(a) the names of the directors considered by the
board to be independent directors;
YES
(a) The Board Charter provides for the disclosure of
the names of Directors considered by the board
to be independent. Currently (James) Zixi Ban is
considered independent;
(b) if a director has an interest, position,
association or relationship of the type
described in Box 2.3 of the ASX Corporate
Governance Principles & Recommendation
(3rd Edition), but the board is of the opinion
that
the
independence of the director, the nature of
the
interest, position, association or
relationship in question and an explanation
of why the board is of that opinion; and
it does not
compromise
(c)
the length of service of each director
and
(b) The Board Charter requires Directors to disclose
interest, positions, associations and
their
the
relationships
independence of Directors is regularly assessed
by the board in light of the interests disclosed by
Directors. Details of the Directors interests,
positions associations and relationships are
provided in the Annual Report; and
requires
that
the
(c) The Board Charter
determination of
terms and
requires the length of service of each Director to
be disclosed. The length of service of each
Director is provided in the Annual Report.
the Directors’
provides
for
Recommendation 2.4
A majority of the board of a listed entity should
be independent directors.
The Board Charter requires that where practical the
majority of the Board will be independent.
NO
The Board currently has one independent Director,
(James) Zixi Ban.
Details of each Director’s independence are provided
in the Annual Report.
43
CORPORATE GOVERNANCE
Recommendation 2.5
The chair of the board of a listed entity should be
an independent director and, in particular, should
not be the same person as the CEO of the entity.
NO
Ultima United Limited - Annual Report
For the year ended 30 June 2017
The Board Charter provides that where practical, the
Chairman of the Board will be a non-executive
director. If the Chairman ceases to be independent
then the Board will consider appointing a lead
independent Director.
Currently Mr Simon Yan fulfils the responsibilities of
both Chairman and Managing Director.
new
Recommendation 2.6
A listed entity should have a program for
providing
directors
inducting
appropriate
development
professional
opportunities for continuing directors to develop
and maintain the skills and knowledge needed to
perform their role as a director effectively.
and
YES
The Board Charter states that a specific responsibility
of the Board is to procure appropriate professional
development opportunities for Directors. As the
Company does not have a Remuneration Committee,
the board is responsible for the approval and review
of
professional
development programs and procedures for Directors
to ensure that they can effectively discharge their
responsibilities.
continuing
induction
and
Principle 3: Act ethically and responsibly
Recommendation 3.1
A listed entity should:
(a) have a code of conduct for its directors,
senior executives and employees; and
(b) disclose that code or a summary of it.
YES
(a) The Corporate Code of Conduct applies to the
Company’s directors, senior executives and
employees.
(b) The Company’s Corporate Code of Conduct is
available on the Company’s website.
Principle 4: Safeguard integrity in financial reporting
Recommendation 4.1
The board of a listed entity should:
(a) have an audit committee which:
NO
(i)
(ii)
has at least three members, all of
whom are non-executive directors
and a majority of whom are
independent directors; and
is chaired by an independent director,
who is not the chair of the board,
and disclose:
(iii)
(iv)
(v)
the charter of the committee;
relevant qualifications and
the
experience of the members of the
committee; and
in relation to each reporting period,
the number of times the committee
met throughout the period and the
individual
the
of
attendances
members at those meetings; or
that
the
(b) if it does not have an audit committee,
disclose that fact and the processes it
independently verify and
employs
safeguard
financial
integrity of
reporting, including the processes for the
appointment and removal of the external
auditor and
the audit
engagement partner.
the rotation of
its
(a) As the Board only consists of three (3)
members, the Company does not have an
Audit and Risk Committee because it would not
be a more efficient mechanism than the full
Board for focusing the Company on specific
issues. The responsibilities of the Audit and
Risk Committee are currently carried out by the
board.
The Company has adopted the Audit and Risk
Committee Charter, which will be followed by the
Audit and Risk Committee once
it has been
established. The Charter provides that:
(i) The Audit and Risk Committee must have at
least three (3) members, all of whom are
non-executive directors, with a majority
being independent; and
(ii) The Chairman of
the Audit and Risk
Committee must not be Chairman of the
Board and must also be independent;
(iii) The Audit and Risk Committee Charter will
the Company
be made available on
website;
(iv) The Board Charter requires the relevant
qualifications and experience of all
members to be disclosed. The Audit and
Risk Committee Charter also outlines the
requisite skills and experience in order to
secure a position on the Audit and Risk
Committee. Details of the qualifications and
experience of Directors is provided in the
Annual Report.
44
CORPORATE GOVERNANCE
Ultima United Limited - Annual Report
For the year ended 30 June 2017
(v) The Board Charter
times
requires
each
Committee in relation to the reporting period
relevant to that Committee, to disclose the
number of
that Committee met
throughout the period, and the individual
attendances of the members at those
Committee meetings. Details of
the
Committee meetings will be provided in the
Company’s Annual Report.
YES
Recommendation 4.2
The board of a listed entity should, before it
approves the entity’s financial statements for a
financial period, receive from its CEO and CFO
a declaration that the financial records of the
entity have been properly maintained and that
the
the
financial statements comply with
appropriate accounting standards and give a
true and fair view of the financial position and
performance of the entity and that the opinion
has been formed on the basis of a sound system
of risk management and internal control which is
operating effectively.
Recommendation 4.3
A listed entity that has an AGM should ensure
that its external auditor attends its AGM and is
available to answer questions from security
holders relevant to the audit.
YES
Principle 5: Make timely and balanced disclosure
Recommendation 5.1
A listed entity should:
(a) have a written policy for complying with its
continuous disclosure obligations under the
Listing Rules; and
YES
(b) disclose that policy or a summary of it.
Principle 6: Respect the rights of security holders
Recommendation 6.1
A listed entity should provide information about
itself and its governance to investors via its
website.
Recommendation 6.2
A listed entity should design and implement an
investor relations program to facilitate effective
two-way communication with investors.
YES
YES
The Audit and Risk Committee Charter states that a
duty and responsibility of the Committee, and as the
Company does not have a Committee, the board, is
to ensure that before the Board approves the entity’s
financial statements for a financial period, the CEO
and CFO have declared that in their opinion the
financial records of the entity have been properly
maintained and that the financial statements comply
with the appropriate accounting standards and give a
true and fair view of the financial position and
performance of the entity and that the opinion has
been formed on the basis of a sound system of risk
management and internal control which is operating
effectively.
The Audit and Risk Committee Charter provides that
the Committee, and as the Company does not have
a Committee, the board, must ensure the Company’s
external auditor attends its AGM and is available to
answer questions from security holders relevant to
the audit.
(a) The Board Charter provides details of the
In addition,
Company’s disclosure policy.
Schedule 7 of the Corporate Governance Plan is
entitled ‘Disclosure-Continuous Disclosure’ and
details the Company’s disclosure requirements
as required by the ASX Listing Rules and other
relevant legislation.
(b) The Board Charter and Schedule 7 of the
Corporate Governance Plan are available on the
Company website.
Information about the Company and its governance
is available in the Corporate Governance Plan which
can be found on the Company’s website.
The Company has adopted a Shareholder
Communications Strategy which aims to promote
and facilitate effective two-way communication with
investors. The Strategy outlines a range of ways in
which information is communicated to shareholders.
The Shareholder Communications Strategy can be
found on the Ultima website in the Corporate
Governance plan under schedule 11.
45
CORPORATE GOVERNANCE
Recommendation 6.3
A listed entity should disclose the policies and
processes it has in place to facilitate and
encourage participation at meetings of security
holders.
YES
Ultima United Limited - Annual Report
For the year ended 30 June 2017
The Shareholder Communication Strategy, which
can be found in schedule 11 of the Corporate
Governance plan on the Ultima website, states that
as a part of the Company’s developing investor
relations program, Shareholders can register with the
Company Secretary to receive email notifications of
when an announcement is made by the Company to
the ASX, including the release of the Annual Report,
half yearly reports and quarterly reports. Links are
made available to the Company’s website on which
all information provided to the ASX is immediately
posted.
Shareholders are encouraged to participate at all
EGMs and AGMs of the Company. Upon the
despatch of any notice of meeting to Shareholders,
the Company Secretary shall send out material with
that notice of meeting stating that all Shareholders
are encouraged to participate at the meeting.
Recommendation 6.4
A listed entity should give security holders the
option to receive communications from, and
send communications to, the entity and its
security registry electronically.
YES
Security holders can register with the Company to
receive email notifications when an announcement is
made by the Company to the ASX.
Shareholders queries should be referred to the
Company Secretary at first instance.
Principle 7: Recognise and manage risk
Recommendation 7.1
The board of a listed entity should:
(a) have a committee or committees to oversee
NO
risk, each of which:
has at
three members, a
(i)
majority of whom are independent
directors; and
is chaired by an independent director,
least
(ii)
and disclose:
the charter of the committee;
the members of the committee; and
(iii)
(iv)
(v) as at the end of each reporting period,
the number of times the committee
met throughout the period and the
individual
the
of
attendances
members at those meetings; or
(b) if it does not have a risk committee or
committees that satisfy (a) above, disclose
that fact and the process it employs for
overseeing the entity’s risk management
framework.
46
(a) The Board is charged with the responsibility of
determining the Company’s risk profile and is
responsible for overseeing and approving risk
management strategy and policies.
As the Board only consists of three (3) members, the
Company does not have an Audit and Risk
Committee because it would not be a more efficient
mechanism than the full Board for focusing the
Company on specific issues. The responsibilities of
the Audit and Risk Committee are currently carried
out by the board.
The Company has adopted the Audit and Risk
Committee Charter, which will be followed by the
Audit and Risk Committee once
it has been
established.
(i) The Audit and Risk Committee Charter states
that the majority of the Committee must be
independent where practical. The Audit and
Risk Committee must comprise of at least three
(3) members, all being non-executive directors
and a majority being independent;
(ii) The Chairman of
the Audit and Risk
Committee must not be the Chairman of the
Board and must be independent.
(iii) The Audit and Risk Committee Charter is
available online at the Company’s website.
(iv) The Board Charter requires disclosure of the
members of the Committee. Details of the
current members are provided in the Annual
Report.
(v) The Board Charter requires each Committee in
relation to the reporting period relevant to that
Committee, to disclose the number of times
each Committee met throughout the period and
the individual attendances of the members at
those Committee meetings. The
relevant
details of each Committee meeting held will be
provided in the Company’s Annual Report.
Ultima United Limited - Annual Report
For the year ended 30 June 2017
(a) The Company process for risk management and
internal compliance includes a requirement to
identify and measure risk, monitor the environment
for emerging factors and trends that affect these
risks, formulate risk management strategies and
monitor the performance of risk management
systems. Schedule 8 of the Corporate Governance
Plan, which can be found on Ultima’s website, is
entitled ‘Disclosure - Risk Management’ and
details the Company’s disclosure requirements
with respect to the risk management review
procedure and internal compliance and controls.
(b) The Board Charter requires (once each Committee
has been established) in relation to the reporting
period relevant to that Committee, to disclose the
number of times that Committee met throughout
the period, and the individual attendances of the
members at those Committee meetings. Details of
the Committee meetings will be provided in the
Company’s Annual Report.
the monitoring,
The Audit and Risk Committee Charter provides for
the internal audit function of the Company. The
Charter outlines
review and
assessment of a range of internal audit functions and
procedures.
Given the size of the Company, no internal audit
function is currently considered necessary. The
Company’s Management periodically undertakes an
internal review of financial systems and processes
and where systems are considered to require
improvement these systems are developed. The
Board also considers external reviews of specific
areas and monitors the implementation of system
improvements.
The Audit and Risk Committee Charter details the
Company’s risk management systems which assist
in identifying and managing potential or apparent
business, economic, environmental and social
sustainability risks (if appropriate). Review of the
Company’s
is
conducted at
reports are
least annually and
continually created by management on the efficiency
and effectiveness of
risk
management framework and associated internal
compliance and control procedures.
risk management
the Company’s
framework
(a) As the Board only consists of three (3) members,
the Company does not have a Remuneration
Committee because it would not be a more
efficient mechanism than the full Board for
focusing the Company on specific issues. The
responsibilities of the Remuneration Committee
are currently carried out by the board, with the
aid of an independent advisor, if required, which
includes evaluating the performance of senior
executives.
CORPORATE GOVERNANCE
Recommendation 7.2
The board or a committee of the board should:
YES
(a) review
the entity’s
risk management
framework with management at
least
annually to satisfy itself that it continues to
be sound, to determine whether there have
been any changes in the material business
risks the entity faces and to ensure that they
remain within the risk appetite set by the
board; and
(b) disclose in relation to each reporting period,
whether such a review has taken place.
YES
Recommendation 7.3
A listed entity should disclose:
(a) if it has an internal audit function, how the
function is structured and what role it
performs; or
YES
(b) if it does not have an internal audit function,
that fact and the processes it employs for
evaluating and continually improving the
effectiveness of its risk management and
internal control processes.
Recommendation 7.4
A listed entity should disclose whether, and if so
how, it has regard to economic, environmental
and social sustainability risks and, if it does, how
it manages or intends to manage those risks.
YES
Principle 8: Remunerate fairly and responsibly
Recommendation 8.1
The board of a listed entity should:
(a) have a remuneration committee which:
NO
(i)
(ii)
has at least three members, a majority of
whom are independent directors; and
is chaired by an independent director,
and disclose:
the charter of the committee;
(iii)
(iv)
the members of the committee; and
(v) as at the end of each reporting period,
the number of times the committee met
throughout the period and the individual
attendances of the members at those
meetings; or
47
Ultima United Limited - Annual Report
For the year ended 30 June 2017
(b) The Company has adopted The Remuneration
Committee Charter, which will be followed by the
Remuneration Committee once it has been
established. The Remuneration Committee
Charter outlines the roles and responsibilities of
the Remuneration Committee and provides that:
(i) The Remuneration Committee comprises of
at least three (3) Directors, the majority of
independent non-executive
whom are
Directors;
(ii) The Remuneration Committee must be
chaired by an independent Director who is
appointed by the Board.
(iii) The Remuneration Committee Charter is
available on the Company website;
(iv) The Board Charter requires disclosure of
the members of the Committee. Details of
the current members are provided in the
Annual Report;
The Board Charter requires each Committee in
relation to the reporting period relevant to that
Committee, to disclose the number of times that
Committee met throughout the period, and the
individual attendances of the members at those
Committee meetings. Details of the Committee
meetings will be provided in the Company’s Annual
Report.
YES
The Remuneration Committee Charter requires the
Company to disclose its policies and practices
regarding
remuneration of non-executive,
executive and other senior directors.
the
CORPORATE GOVERNANCE
(b) if
fact and
it does not have a
that
remuneration
committee, disclose
the
processes it employs for setting the level
and composition of
for
directors and senior executives and
ensuring
is
appropriate and not excessive.
remuneration
remuneration
that such
and
regarding
Recommendation 8.2
A listed entity should separately disclose its
policies
the
practices
remuneration of non-executive directors and the
remuneration of executive directors and other
senior executives and ensure that the different
roles and
responsibilities of non-executive
directors compared to executive directors and
other senior executives are reflected in the level
and composition of their remuneration.
Recommendation 8.3
A listed entity which has an equity-based
remuneration scheme should:
(a) have a policy on whether participants are
permitted to enter into transactions
(whether through the use of derivatives or
otherwise) which limit the economic risk of
participating in the scheme; and
YES
(a) The Remuneration Committee Charter
is
required to review, manage and disclose the
policy (if any) on whether participants are
permitted to enter into transactions (whether
through the use of derivatives or otherwise)
which limit the economic risk of participating in
the scheme. The Remuneration Committee
Charter
the Remuneration
Committee, and in this case the Board, as no
Remuneration Committee currently exists, must
review and approve any equity based plans.
states
that
(b) disclose that policy or a summary of it.
(b) A copy of the Remuneration Committee Charter
is available on the Company’s website.
48
ADDITIONAL SHAREHOLDER INFORMATION
HOLDINGS AS AT 23 AUGUST 2017
The distribution of members and their holdings of equity securities in the company as at 23 August 2017 were as
follows:
Ultima United Limited - Annual Report
For the year ended 30 June 2017
Fully Paid Shares
No. of Holders
Securities
50
251
95
115
25
536
21,968
795,239
833,044
2,800,762
21,049,639
25,500,652
No.
2,629,548
2,520,000
2,029,725
1,767,595
1,642,500
1,503,000
978,455
948,350
782,556
750,000
734,473
700,000
622,250
553,500
500,000
482,670
480,017
450,000
292,500
250,000
20,617,139
(%)
10.31
9.88
7.96
6.93
6.44
5.89
3.84
3.72
3.07
2.94
2.88
2.74
2.44
2.17
1.96
1.89
1.88
1.76
1.15
0.98
80.83
(%)
10.31
9.88
7.96
6.93
6.44
5.89
Number of Securities Held
1-1,000
1,001 - 5,000
5,001 – 10,000
10,001 - 100,000
100,001 and over
Total
Holders of less than a marketable parcel: 328
20 LARGEST SHAREHOLDERS AS AT 23 AUGUST 2017
Fully Paid Ordinary Shares
1 MS YOU LIAN ZHENG
2 HD MINING & INVESTMENT
3 MR CHENG RONG WANG
4 YONG HUA XIAO
5 UNITED MINING RESOURCES / XING YAN
6 XIBO MA
7 CAPITAL H MANAGEMENT PTY LTD
8 XIAO HUI HUANG
9 MR CHRISTOPHER JOHN FONE
10 JIAN LUO SUN
11 MRS SHUFANG LI
12 MRS SHU FANG LI
13 BESSARLIE PTY LTD
14 MR LANCHUN WU
15 YU LIN SU
16 MDM KAM LAN CHOO
17 MRS XIUZHEN LIU
18 AUSTHONG INTERNATIONAL GROUP
19 FM104.9 NETWORK PTY LTD
20 MS XIAOHUI HUANG
Substantial Shareholders
The names of the substantial shareholders listed in the Company’s register as at 23 August 2017:
Fully Paid Ordinary Shares
MS YOU LIAN ZHENG
HD MINING & INVESTMENT
MR CHENG RONG WANG
YONG HUA XIAO
UNITED MINING RESOURCES / XING YAN
XIBO MA
No.
2,629,548
2,520,000
2,029,725
1,767,595
1,642,500
1,503,000
49
Ultima United Limited - Annual Report
For the year ended 30 June 2017
ADDITIONAL SHAREHOLDER INFORMATION
Voting Rights
Ordinary Shares
In accordance with the Company's Constitution, on a show of hands every member present in person or by proxy or
attorney or duly authorised representative has one vote. On a poll every member present in person or by proxy or
attorney or duly authorised representative has one vote for every fully paid ordinary share held.
Restricted Securities
The Company has no restricted securities at the current date.
Company Secretary
The name of the Company Secretary is Piers Lewis.
Address and telephone details of the entity’s registered and administrative office
Suite 14,11 Preston Street
COMO, WA 6152
Telephone: + (61) 8 6436 1888
Facsimile: + (61) 8 6436 1899
Address and telephone details of the office at which a register of securities is kept
Advanced Share Registry Services
150 Stirling Highway
Nedlands Western Australia 6009
Telephone: + (61) 8 9389 8033
Facsimile: + (61) 8 9367 3311
Securities exchange on which the Company’s securities are quoted
The Company’s listed equity securities are quoted on the Australian Securities Exchange.
Review of Operations
A review of operations is contained in the Directors’ Report.
50