30 June 2023 Annual Report
Enprise Group Limited
Annual Report and Financial Statements
for the year ended 30 June 2023
Enprise Group Limited
Annual Report and Financial Statements
for the year ended 30 June 2023
Contents
Directors Report
2
Our Businesses
4
Board of Directors
5
Finanical Statements:
Consolidated Statement of Comprehensive Income
6
Consolidated Statement of Financial Position
7 - 8
Consolidated Statement of Changes in Equity
9
Consolidated Statement of Cash Flows
10
Notes to the Consolidated Financial Statements
11
Shareholders Statutory Information
41
Directory
44
Auditor's Report
45
1
Enprise Group Limited
Directors' Report
The Directors are pleased to submit to shareholders their report and financial statements for the year ended 30 June 2023.
Principal activities
Significant changes in the state of affairs
Review of operations and outlook
Kilimanjaro Consulting
0
20232022
Recurring Revenue$4.481m$3.897m
Contracted Revenue$4.171m$3.325m
Total Recurring and Contracted Revenue$8.652m$7.222m
iSell
Datagate
Datagate Innovation Ltd (Datagate) grew its annual recurring revenue (ARR) to over $3.3 million, an increase of 35%. Datagate continues to be in high growth mode and is
keeping its focus on growing revenue and market share. Datagate is forecasting to reach break-even in the last quarter of the 2023 calendar year.
The dispute had the benefit of cementing the already strong culture of the organisation, the Board expresses its grititude to shareholders, management, team members
and clients for their unwavering support that enabled us to get to this point. The business has a number of revenue streams, but the products are essentially MYOB
Enterprise solutions. The MYOB Advanced product is a localised version of the Acumatica Business Management Platform. The product is widely recognised
internationally as the best in its class. MYOB is marketing and promoting it strongly, and as it gains traction in the Australian and New Zealand markets, Kilimanjaro will
undoubtedly benefit.
Some funds will be used to pay the agreed settlement sum in relation to a legal case taken by a former employee which was settled on 31 July 2023.
Annual recurring revenue (ARR) increased to $1.22 million (up 18%) and total revenue to $1.2 million (up 10%). Enprise currently owns 75% of iSell. During the year iSell
completed the integration to Halo PSA which has increased its addressable market. On 25 August 2023, iSell opened a rights issue which will raise AU$900,000 of which
AU$600,000 is Enprise converting its existing loan and AU$300,000 new funds from other iSell shareholders. This will be used to support sales growth as iSell nears
completion of development work on the latest version of its software.
Increased competition and consolidation are expected within the partner channel, as the Acumatica product gains popularity. Competition is also being experienced from
MYOB themselves, through their direct channel. Kilimanjaro's unique position in the market and the premium pricing model allows it to focus on the larger, more complex
implementations. Kilimanjaro's large base of existing Exo users remains core to its strategies. Kilimanjaro aims to continue to provide exceptional service to these Exo
clients for at least the next decade. A new initiative will identify clients that wish to move to the cloud, and a separate team will manage the implementations of those Exo
clients transitioning from Exo to MYOB Advanced (Acumatica).
The mutually acceptable resolution of the MYOB dispute brings to a close a two-year period of uncertainty for Kilimanjaro as annouced to the NZX on 28 September 2023
(Note 25 (b)). This gives Kilimanjaro clear sky to grow and prosper. While the past year has been challenging from a profitability perspective, the business still grew
revenue by 11% (last year 16%) to $19.501m for the financial year. The growth in contracted revenues was 25% (last year 20.5%).
Enprise Group Limited (Enprise) has two operating divisions;
Enprise is invested in Datagate Innovation Limited (Datagate) that provides online reporting and billing portals under a Software-as-a-Service (SaaS) model for resellers of
Telco/Utility services and hosted service providers in New Zealand, Australia, Canada, USA and Europe. Enprise holds 32.96% of Datagate.
The Datagate convertible note was exercised on 18 November 2022 increasing Enprise shareholding in Datagate by 237,472 shares. Enprise also participated in the
Datagate rights issue in November 2022, taking its approximate pro rata share of the fully subscribed issue of $0.75 million at $2.80 per share. Enprise now holds
2,411,024 shares (32.96%) of Datagate.
• iSell Pty Limited (iSell), sell a cloud-based quoting systems (IT Quoter) on a Software-as-a-Service (SaaS) model used by the IT reseller market in Australia, New
Zealand, UK & Europe, USA and South Africa.
• Kilimanjaro Consulting, a solution provider for MYOB Enterprise software in Australia and New Zealand
Enprise is invested in Vadacom Holdings Limited (Vadacom), a leading voice over IP (VoIP) telephony solutions provider. Enprise holds 6.35% of Vadacom.
2
Enprise Group Limited
Directors' Report
Vadacom
George Cooper - DirectorRonald Baskind - Director
Chief Executive Officer - Enprise GroupChief Executive Officer - Kilimanjaro Division
29 September 2023
29 September 2023
Vadacom Holdings Ltd (Vadacom)’s ARR and contracted revenue was $2.32 million for the year ended 31 March 2023. The cloud PBX phone system ‘Next Voice’
functionality continues to expand to support new and existing customers directly and through resellers. As a result of a draft independent valuation of Vadacom, Enprise
Group realised a $0.175 million decrease in the carrying value of this investment in the period.
3
Enprise Group Limited
Our Businesses
Kilimanjaro Consulting is MYOB’s number one partner
in Australia and New Zealand and is the leading trans-
Tasman provider of solutions based on the MYOB Advanced
(Acumatica) and MYOB Exo software platforms. It offers a
companion product range to extend the power and
functionality of MYOB Advanced and MYOB Exo. Kilimanjaro
hosts, implements, integrates, manages and supports all of
the software it sells. Kilimanjaro services clients in a range of
industries through branches in Australia and New Zealand.
iSell is a primary provider of business systems to the IT
Reseller market. iSell databases contain over 4.5 million
products representing more than 2000 vendors available
from 100+ distributors. The products are sent automatically
to hundreds of IT Resellers daily, across Australia, New
Zealand, UK & Europe, South Africa and USA.
Datagate offers one-stop SaaS telecom billing. Datagate
has everything required to make billing telecommunications
easy, quick, profitable and compliant, in a single SaaS
package. The Datagate online billing portal enables IT
Managed Service Providers (MSPs) to bill telecom services
optimally at minimal time and cost. Datagate is the online
billing portal that integrates with software that’s important to
MSPs, including ConnectWise and other professional
services automation software, tax engines and popular
accounting systems like QuickBooks and Xero.
Vadacom specialises in phone system software
development and unified communications solutions for
Australian and New Zealand businesses. Vadacom is one of
New Zealand’s leading developers of open source
technology and Voice over IP (VoIP) based IP telecoms
solutions to businesses of all sizes.
4
Enprise Group Limited
Board of Directors
Elliot Cooper is CEO of the Enprise Group. He is also co-founder and Executive
Director of Enprise Group, and formerly held the Enprise Group CFO role.
In addition to his financial expertise Elliot has extensive experience in the financial
software business. He is a qualified accountant with deep experience in financial
accounting and financial controller roles.
Elliot was one of the original creators of Exonet Finance (now renamed MYOB Exo),
alongside Mark Loveys. Like Mark, Elliot has been involved with the product every
step of the way since its inception at PC Direct in the 1990s.
Nick Paul is an Enprise Group Non-Executive Director. He is an accomplished
senior leadership professional with over 30 years of achievement and success
driving sales growth in highly competitive technology related markets.
With over 20 years’ experience in the Telco industry Nick has held senior Sales and
Distribution roles in Vodafone and Spark. More recently as CEO of Leading Edge
Communications – Spark's largest channel partner – he has developed a strong
understanding of developing sales channel models and implementation. He has
recently used this knowledge to create The Sales Factory, a business consultancy
helping organisations create appropriate sales and distribution strategies and
channel plans for their businesses
Dr Aneesha Varghese-Cowan is an Enprise Group Non-Executive Director.
Aneesha is a specialist technology-driven finance executive with over two decades
of experience across a diverse range of industries including Web 3.0, professional
services, manufacturing, and supply chain.
Aneesha currently serves on two other boards and one advisory panel. She has
specialist expertise in commercial finance, investment evaluation, financial
transformation at Board level and organisational change management including
Financial Control, Treasury, Banking and Tax oversight. Aneesha also has
extensive experience in optimising and leveraging data and digital transformation;
KPI and report development.
Ronnie Baskind is an Enprise Group Executive Director. He has more than 30
years’ experience as an entrepreneur, management consultant, senior executive,
director and agribusiness professional. Ronnie is CEO of the Enprise Group
division, Kilimanjaro Consulting.
Ronnie’s diverse background, combined with strong analytical and facilitation skills,
has given him a deep insight into businesses across most industry sectors and in
various stages of development. Ronnie is the founder of Kilimanjaro Consulting Pty
Limited, Australia’s largest implementer of MYOB’s enterprise-level business
management solutions.
Lindsay Phillips is an Enprise Group Non-Executive Director. He has been
involved in private equity for over 30 years, commencing in 1987 with M.J.H.
Nightingale & Co. Limited in London/New York and subsequently Australia since
1995. Lindsay's experience includes seven years (1980-87) with Price Waterhouse
and twenty-six years in investment banking/private equity in the United Kingdom,
Europe, USA and Australia including five years (2007-12) as Managing Director of
Lazard Australia Private Equity. Lindsay is currently Managing Director of two
investment funds – Phoenix Development Fund and Nightingale Partners – focused
on providing patient expansion capital to family companies. He serves as a Director
of most of the companies in which the funds are invested.
5
Enprise Group Limited
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2023
30 June 202330 June 2022
Note
$'000$'000
Revenue from contracts with customers
3
20,75118,744
Employee expense
4(d)
(15,784)(15,057)
Other operating costs
4(c)
(7,403)(5,501)
Other gains/(losses) - net
4(a)
(77)32
Operating profit/(loss)
(2,513)(1,782)
Equity earnings/(losses) from associates and joint ventures
13
(330)(556)
Other gains/(losses) related to associates and joint ventures
13
- 8
Impairment of intangible assets
16
(6,786)-
Finance cost - net
4(b)
(219)(90)
Profit/(loss) before income tax
(9,848)(2,420)
Income tax benefit
5(a)
(904)227
Profit/(loss) for the period(10,752)(2,193)
Other Comprehensive Income
Items that may be reclassified to profit or loss
Foreign currency translation differences(40)155
Items that will not be reclassified to profit or loss
Changes in the fair value of investments through other comprehensive income
14
(175)(60)
Total comprehensive income/(loss) for the period
(10,967)(2,098)
Profit/(loss) for the period is attributable to:
Non-Controlling Interest(473)(357)
Owners of Enprise Group Limited
(10,279)(1,836)
(10,752)(2,193)
Total comprehensive income/(loss) for the period is attributable to
Non-Controlling Interest(473)(357)
Owners of Enprise Group Limited
(10,494)(1,741)
(10,967)(2,098)
Earnings per share from profit/(loss) for the period attributable to ordinary shareholders of the Enprise Group Limited
Basic and diluted earnings/(loss) per share (see note 6) cents per share(60.82) (11.36)
These financial statements should be read in conjunction with the Auditor's report.
6
Enprise Group Limited
Consolidated Statement of Financial Position
as at 30 June 2023
30 June 202330 June 2022
Note
$'000$'000
Current assets
Cash and cash equivalents
18
1,1781,546
Trade and other receivables
7
3,9113,190
Contract assets
8
669831
Current tax assets
5(c)
24-
Staff receivables
12-
Total current assets
5,7945,567
Non-current assets
Investments in associates, joint ventures
13912285
Investments in other entities
14452627
Staff receivables - non current
17-
Property plant and equipment
15388348
Intangible assets
162,94811,231
Right-of-use assets - non-current
171,0981,340
Deferred tax asset
5(d)1,2672,197
Loans to related parties - non current
21(e)3273
Other non-current assets
936552
Total non-current assets
7,15016,653
Total assets
12,94422,220
Current liabilities
-
Trade and other payables
10
3,4302,963
Provisions
11
1,9851,696
Contract liabilities
12
1,6892,582
Current tax liabilities
5(c)
- 19
Borrowings
18
2,0961,183
Lease liabilities
19
498495
Other current liabilities
- -
Total current liabilities
9,6988,938
Non-current liabilities
Provisions - non-current
11
356302
Lease liabilities - non-current
19
734970
Deferred tax liability
5(d)
710656
Other non-current liabilities
- -
Total non-current liabilities
1,8001,928
Total liabilities
11,49810,866
Net assets
1,44611,354
These financial statements should be read in conjunction with the Auditor's report.
7
Enprise Group Limited
Consolidated Statement of Financial Position
as at 30 June 2023
30 June 202330 June 2022
Note
$'000$'000
Equity
Share capital
20(a)
12,08011,010
Foreign exchange translation reserve
311351
Financial assets at FVOCI reserve
353528
Retained earnings / (accumulated losses)
(10,985)(696)
Equity attributable to the owners of Enprise Group Limited1,75911,193
Non-controlling interests
22(313)161
Total equity
1,44611,354
- -
These financial statements have been authorised for issue by the Directors.
For and on behalf of the Board:
George Cooper - DirectorRonald Baskind - Director
Chief Executive Officer - Enprise GroupChief Executive Officer - Kilimanjaro Division
29 September 2023
29 September 2023
These financial statements should be read in conjunction with the Auditor's report.
8
Enprise Group Limited
Consolidated Statement of Changes in Equity
for the year ended 30 June 2023
Share capital
Foreign
exchange
translation
reserve
Financial
assets at
FVOCI
reserve
Retained
earnings /
(accumulated
losses)
Non-
controlling
interests
Total equity
$'000$'000$'000$'000$'000$'000
Balance at 1 July 202111,010 196 588 1,444 555 13,793
Transactions with shareholders in their capacity as owners
Dividends paid
- - - (404) - (404)
Transactions with non-controlling interests (note 22)- - - 100 (37) 63
Total transactions with shareholders
- - - (304) (37) (341)
Comprehensive income
Profit for the period- - - (1,836) (357) (2,193)
Other comprehensive income
- 155 (60) - - 95
Total comprehensive income net of tax- 155 (60) (1,836) (357) (2,098)
Balance at 30 June 2022
11,010 351 528 (696) 161 11,354
Balance at 1 July 202211,010 351 528 (696) 161 11,354
Transactions with shareholders in their capacity as owners
Dividends paid
- - - - - -
New shares issued (note 20)1,070 - - - - 1,070
Transactions with non-controlling interests (note 22)- - - (10) (1) (11)
Total transactions with shareholders
1,070 - - (10) (1) 1,059
Comprehensive income-
Profit/(loss) for the period- - - (10,279) (473) (10,752)
Other comprehensive income/(loss)
- (40) (175) - - (215)
Balance at 30 June 2023
12,080 311 353 (10,985) (313) 1,446
These financial statements should be read in conjunction with the Auditor's report.
9
Enprise Group Limited
Consolidated Statement of Cash Flows
for the year ended 30 June 2023
Note
30 June 202330 June 2022
$'000$'000
Operating activities
Cash was provided from:
Receipts from customers
21,616 21,047
Government assistance
- 4
Interest received
6 1
21,62221,052
Cash was applied to:
Payments to suppliers & employees
22,105 21,056
Interest paid
239 122
Income tax paid
3 20
22,34721,198
Net cash inflow/(outflow) from operating activities23(725) (146)
Investing activities
Cash was provided from:
Loans repaid by staff2
-
Loans repaid by related parties
42 16
44 16
Cash was applied to:
Purchase of property, plant and equipment
77 181
Software development costs
516 305
Investment in equity accounted investment434
-
Convertible note
-
500
Purchase of business-
- 325
1,0271,311
Net cash inflow/(outflow) from investing activities(983) (1,295)
Financing activities
Cash was provided from:
Proceeds from issue of shares1,040 -
Proceeds from bank borrowings
723
1,000
Proceeds from issue of shares in iSell Pty Limited to non-controlling interests
136
1,763 1,136
Cash was applied to:
Dividends paid
- 404
Purchase of shares in iSell Pty Limited from non-controlling interests
11 74
Repayment of lease liabilities
595 612
Repayment of bank borrowings
388 188
Repayment of other borrowings
42 12
1,036 1,290
Net cash inflow/(outflow) from financing activities727 (154)
Net increase/(decrease) in cash and cash equivalents held(981) (1,595)
Net foreign exchange differences
(6) 5
Cash and cash equivalents at beginning of the period1,216 2,806
Cash and cash equivalents at end of the period
18
229 1,216
- -
These financial statements should be read in conjunction with the Auditor's report.
10
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
1BASIS OF PREPARATION
(a)Reporting entity
(b)Compliance statement
(c)Basis of preparation
(d)Principles of consolidation
The consolidated financial statements comprise the financial statement of the company and its subsidiaries.
Percentage ownership
30 June 202330 June 2022
Kilimanjaro Consulting Limited New ZealandSoftware sales and solutions100.00 100.00
Kilimanjaro Consulting Pty LimitedAustraliaSoftware sales and solutions100.00 100.00
Enprise Australia Pty LimitedAustraliaSoftware sales and solutions100.00 100.00
Enprise LimitedNew ZealandSoftware sales and solutions100.00 100.00
Global Bizpro LimitedNew ZealandNon-trading100.00 100.00
Team Tiger KC LimitedNew ZealandNon-trading100.00 100.00
iSell Pty LimitedAustraliaSoftware sales and solutions75.25 75.03
IT Quoter LimitedNew ZealandNon-trading75.25 75.03
IT Quoter North America IncUnited StatesNon-trading75.25 75.03
iSell Philippines IncPhilippinesSoftware development75.25 75.03
(e)Business Combinations
Subsidiaries are all entities over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns
from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are consolidated from the date on which
control is transferred to the Company. They are deconsolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains or losses on transactions between Group companies are eliminated. Accounting policies of subsidiaries are
changed when necessary to ensure consistency with the policies adopted by the Company.
Name of EntityPrincipal activity
Enprise Group Limited (the company) and its subsidiaries (together the Group) is a high-tech software and services investment company. The company is a limited
liability company incorporated and domiciled in New Zealand and is listed on the New Zealand Stock Exchange (NZX). The Group is registered under the Companies
Act 1993 and is a FMC Reporting Entity under Part 7 of the Financial Markets Conduct Act (FMCA) 2013. The address of its registered office is 16 Hugo Johnston
Drive, Penrose, Auckland.
These consolidated financial statements have been prepared in accordance with New Zealand Generally Accepted Accounting Practice (NZ GAAP), the Companies
Act 1993, the FMCA 2013 and NZX listing rules. They comply with New Zealand Equivalents to International Financial Reporting Standards (NZ IFRS), other New
Zealand accounting standards and authoritative notices that are applicable to entities that apply NZ IFRS. The consolidated financial statements also comply with
International Financial Reporting Standards (IFRS). The Group is a for-profit entity for the purposes of complying with NZ GAAP.
The financial statements have been prepared under the historical cost convention, as modified by the revaluation of certain assets and liabilities at fair value.
The consolidated financial statements are presented in New Zealand dollars which is the Company's functional currency and the Group's presentation currency. All
financial information has been prepared in thousands, unless otherwise stated.
The principal accounting policies adopted in the preparation of the financial report are set out in the accompanying notes and indicated by the shaded text. These
policies have been consistently applied to all the periods presented, unless otherwise stated.
Country of incorporation
The acquisition method of accounting is used to account for business combinations regardless of whether equity instruments or other assets are acquired.
The consideration transferred is the sum of the acquisition-date fair values of the assets transferred, equity instruments issued or liabilities incurred by the acquirer to
former owners of the acquiree and the amount of any non-controlling interest in the acquiree. For the iSell Pty Limited business combination, the non-controlling
interest in the acquiree is measured at the proportionate share of the acquiree's identifiable net assets. All acquisition costs are expensed as incurred to profit or loss.
On the acquisition of a business, the consolidated entity assesses the financial assets acquired and liabilities assumed for appropriate classification and designation in
accordance with the contractual terms, economic conditions, the consolidated entity's operating or accounting policies and other pertinent conditions in existence at
the acquisition-date.
Where the business combination is achieved in stages, the consolidated entity remeasures its previously held equity interest in the acquiree at the acquisition-date fair
value and the difference between the fair value and the previous carrying amount is recognised in profit or loss.
These financial statements should be read in conjunction with the Auditor's report.
11
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
1BASIS OF PREPARATION (CONTINUED)
(e)Business Combinations (continued)
(f)Foreign currency translation
(g)Financial instruments
Financial assets
Classification of financial assets
Financial assets that meet the following conditions are measured subsequently at amortised cost:
- the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and
Financial assets that meet the following conditions are measured subsequently at fair value through other comprehensive income (FVOCI):
- the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling the financial assets; and
By default, all other financial assets are measured subsequently at fair value through profit or loss (FVTPL).
Effective interest method
- the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal
amount outstanding.
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains
and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in
foreign currencies are recognised in the profit and loss.
- the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal
amount outstanding.
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period. The
effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form an integral part of the
effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or (where appropriate) a shorter period,
to the net carrying amount on initial recognition.
Income is recognised on an effective interest basis for debt instruments.
Financial assets are classified into the following specified categories: 'fair value through other comprehensive income' and 'amortised cost'. The classification
depends on the business model and contractual terms of the financial assets and is determined at the time of initial recognition. All regular way purchases or sales
of financial assets are recognised and derecognised on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require
delivery of assets within the time frame established by regulation or convention in the marketplace.
The consolidated financial statements are presented in New Zealand dollars, which is the Group’s presentation currency. Items included in the financial statements of
each of the subsidiaries are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”).
The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-controlling interest in the acquiree and the fair value of the
consideration transferred and the fair value of any pre-existing investment in the acquiree is recognised as goodwill. If the consideration transferred and the pre-
existing fair value is less than the fair value of the identifiable net assets acquired, being a bargain purchase to the acquirer, the difference is recognised as a gain
directly in profit or loss by the acquirer on the acquisition-date, but only after a reassessment of the identification and measurement of the net assets acquired, the non-
controlling interest in the acquiree, if any, the consideration transferred and the acquirer's previously held equity interest in the acquirer.
The results and financial position of entities that have a different functional currency are translated to NZD as follows: assets and liabilities are translated at the
exchange rate at balance date and income statement items are translated at the average exchange rates for the year. Exchange differences are recognised in other
comprehensive income as a currency translation reserve movement.
Financial assets and financial liabilities are recognised in the Group’s statement of financial position when the Group becomes a party to the contractual provisions of
the instrument.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets
and financial liabilities are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs
directly attributable to the acquisition of financial assets are recognised immediately in profit or loss.
These financial statements should be read in conjunction with the Auditor's report.
12
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
1BASIS OF PREPARATION (CONTINUED)
Impairment of financial assets
Measurement and recognition of expected credit losses
Derecognition of financial assets
Financial liabilities
Derecognition of financial liabilities
(h)Critical accounting judgements and estimates
Judgements and estimates which are material to the financial statements are found in the following notes:
(a) Revenue recognition (note 3).
(b) Taxation (note 5(d)).
(c) Intangible assets (note 16).
(d) Investments in other entities (note 14).
(e) Lease liabilities (note 19).
(f) Impairment (note 16).
(g) Going concern assumption.
(i)Going concern assumption
In the process of applying the Group's accounting policies and the application of accounting standards, a number of estimates and judgements have been made. The
estimates and underlying assumptions are based on historical experience and adjusted for current market conditions and other factors, including expectations of future
events that are considered to be reasonable under the circumstances. If outcomes within the next financial period are significantly different from assumptions, this
could result in adjustments to carrying amounts of the asset or liability affected.
The Group derecognises financial liabilities when, and only when, the Group's obligations are discharged, cancelled or have expired. The difference between the
carrying amount of the financial liability derecognised and the consideration paid and payable is recognised in profit or loss.
On derecognition of a financial asset, the difference between the asset's carrying amount and the sum of the consideration received and receivable and the
cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity, is recognised in profit or loss.
At 30 June 2023, the Group had incurred a loss of $10.752m and had net working capital deficiency of $3.904m. In addition, the Group was in breach of its banking
covenants. The Group had prepared a budget for the 2024 year that indicated a significant improvement in performance of the Kilimanjaro division, which is expected
to enable the Group to comply with its banking covenants for the year to 30 June 2024. However as of the date of this report, it has not yet obtained an agreement
from BNZ to extend its existing facilities beyond their current expiry date of 31 October 2023.
The Group requires significant improvement in profitability and cash flow generation within the Kilimanjaro division, to be able to comply with its banking covenants.
This cashflow generation is also required for capital investment within the Group's other investments, including iSell Pty Limited. These conditions create significant
doubt as to the ability of the Group to operate as a going concern.
The Group recognises a loss allowance for expected credit losses on financial assets that are measured at amortised cost and contract assets. The amount of
expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition of the respective financial instrument.
The measurement of expected credit losses is a function of the probability of default, loss given default (i.e. the magnitude of the loss if there is a default) and the
exposure at default. The assessment of the probability of default and loss given default is based on historical data adjusted by forward‑looking information as
described above.
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and
substantially all the risks and rewards of ownership of the asset to another party. If the Group neither transfers nor retains substantially all the risks and rewards of
ownership and continues to control the transferred asset, the Group recognises its retained interest in the asset and an associated liability for amounts it may have
to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognise the financial asset
and also recognises a collateralised borrowing for the proceeds received.
Financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortised cost using the effective interest method.
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The
effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of
the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter
period, to the net carrying amount on initial recognition.
These financial statements should be read in conjunction with the Auditor's report.
13
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
1BASIS OF PREPARATION (CONTINUED)
(i)Going concern assumption (continued)
However:
2SEGMENT INFORMATION
(a)Operational performance
Revenue
Operating profit
Business segments
30 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000
Kilimanjaro Consulting19,501 17,618 234 351
iSell1,201 1,093 (2,290) (1,249)
Corporate49 33 (750) (884)
- -
20,751 18,744 (2,806) (1,782)
Equity earnings of associates and joint ventures(330) (548)
Impairment of intangible assets(6,493) -
Net interest expense(219) (90)
- -
Profit/(loss) before taxation(9,848) (2,420)
- -
Income Tax(904) 227
- -
Net profit/(loss) attributable to shareholders(10,752) (2,193)
Revenue
Operating profit
Geographic segments
30 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000
New Zealand6,868 6,066 (478) 41
Australia13,711 12,474 (1,869) (1,659)
EMEA*154 152 (123) (155)
North America16 9 (43) (9)
Asia2 43 - -
- -
20,751 18,744 (2,513) (1,782)
-
* Europe, Middle East and Africa
- -
The Group is organised into two reportable operating segments based on the business segments. These segments form the basis of internal reporting used by
management and the Board of Directors to monitor and assess performance and assist with strategic decisions. The Board of Directors is the Group's chief operating
decision maker (CODM). Management has determined the operating segments based on the information reviewed by the Board of Directors and the Chief Executive
Officer for the purposes of allocating resources and assessing performance.
In order to mitigate the risks presented to the Group, Kilimanjaro management along with the Enprise board, are currently revisiting the strategic plan of this division
including diversification and a range of cost reduction measures. To satisfy the future capital investment and liquidity requirements of the Enprise Group, the board
completed a capital raise in September 2023 (note 25). The board is confident that the capital raised along with the budgeted improved financial performance of
Kilimanjaro will be sufficient for the Group’s foreseeable cashflow requirements.
- the need to maintain or replace the debt facilities with BNZ together with strategic and cost reduction initiatives within the Kilimanjaro division, indicates the
existence of a material uncertainty that may cast significant doubt on the Group’s ability to continue as a going concern, and therefore the Group may be unable to
realise its assets and discharge its liabilities in the normal course of operations.
The directors consider that there is a reasonable expectation the Group will have sufficient funds, in conjunction with the intended capital raise, to enable it to continue
to trade for the foreseeable future and be able to continue to meet its liabilities as they fall due. Taking this into account, it is the considered view of the directors that
the Group remains a going concern.
- the heightened degree of uncertainty around the level of future revenues and profitability, and
These financial statements should be read in conjunction with the Auditor's report.
14
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
2SEGMENT INFORMATION (CONTINUED)
(b)Interest, deprecation and amortisation
Interest revenue
Interest expense
30 June 202330 June 202230 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000$'000$'000
New Zealand17 22 200 92 290 292
Australia3 - 39 20 2,515 1,062
20 22 239 112 2,805 1,354
- - - - -
(c)Balance sheet informationNon Current Asset
Total assets
Total liabilities
30 June 202330 June 202230 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000$'000$'000
Kilimanjaro Consulting3,011 9,052 9,727 16,688 9,937 11,374
iSell1,424 3,867 1,618 4,150 1,998 878
Corporate912 285 4,417 5,227 2,381 2,459
5,347 13,204 15,762 26,065 14,316 14,711
Inter-segment elimination- - (2,818) (3,845) (2,818) (3,845)
-
5,347 13,204 12,944 22,220 11,498 10,866
-
New Zealand2,858 3,119 7,817 9,832 4,906 5,566
Australia2,489 10,085 7,346 15,764 8,811 8,676
5,347 13,204 15,163 25,596 13,717 14,242
Inter-segment elimination- - (2,219) (3,376) (2,219) (3,376)
- -
5,347 13,204 12,944 22,220 11,498 10,866
- - - - - - - -
Depreciation and
amortisation expense
Non-current assets other than
financing and deferred tax
These financial statements should be read in conjunction with the Auditor's report.
15
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
3REVENUE
Revenue from contracts with customers
- Enterprise software licence revenue
- Support services revenue
- Implementation and consulting revenue
- Other fees such as hosting fees and hardware sales
- iSell revenue
Software licence revenue under NZ IFRS 15 is recognised through an agency arrangement and therefore the
agency revenue margin is recognised in the statement of comprehensive income.
The revenue is calculated based on commission margin percentages agreed between the Group and the
third-party licenser.
The agency commission is recognised at a point in time when the customer gains access to the software or is
provided with continued use of the software, generally through providing a code to enable continued access.
Customers are typically invoiced annually (but sometimes monthly) for recurring software licences and
commissions are recognised once the performance obligation has been satisfied.
Revenue is recognised during the period in which the services have been rendered or the goods supplied.
Services and support revenue -
Support contracts
iSell Revenue - Other - Onboarding fees
- Data services
Revenue is recognised during the period in which the services have been rendered or the goods supplied.
Each of the above streams delivered to customers are considered separate performance obligations, even though for practical reasons they may be governed by a
single legal contract with the customer. Revenue recognition for each of the above revenue streams is as follows:
Enterprise software licence
revenue
Closure of support
query or standing
ready to provide
support
Initial access or
continued access to
the software
Services and support revenue -
Implementation and consulting
revenue
At completion of data
conversions, user
acceptance testing
(UAT) or specific
solution provided.
Revenue stream
Performance
obligation
Timing of recognition
Other fees
The Group's primary activity is providing software solutions within Australia and New Zealand. From these activities the Group generates the following streams of
revenue:
Revenue is recognised at a point in time, and in the period in which the software has been invoiced.
Customers are typically invoiced for a period of time for expected upcoming usage as they are typically not
yet able to use or be migrated to the new cloud system. Annual charges for legacy system customers
invoiced after 1 January 2021 comes with the promise of a credit if the customer transitions to the new cloud
system during the invoiced period. Revenue with this promise is deferred and recognised monthly.
- Training
- Hardware
Revenue is recognised during the period in which the services have been rendered or the goods supplied. - Hosting services
iSell Revenue - Software licence
revenue cloud system
ExoHosted Revenue
iSell Revenue - Software licence
revenue legacy system
Support contract revenue is recognised at a point in time as the services are delivered. The contract is
between the customer and Enprise, as principal.
Revenue from providing support services is recognised in the accounting period in which the services are
rendered. Revenue is calculated based on time and cost incurred, a fixed monthly charge or a combination
of both.
Recognition is determined based on the contract with the customer. This can be:
- actual labour hours spent to resolve the query,
- an agreed monthly charge plus actual labour hours spent to resolve the query not covered by the monthly
agreed charge, or
- an agreed monthly charge.
Customers are typically invoiced monthly when the job has been closed. Consideration is payable when
invoiced and corresponds directly to the performance completed to date in respect to this revenue stream.
Revenue is recognised at a point and time when the solution has been delivered .
Revenue provided from services is recognised in the accounting period in which the solution has been
provided.
Recognition is determined based on the contract, either a fixed price or actual labour hours spent. Revenue
is recognised in full at the end of the project when go-live has occurred.
Customers are typically invoiced throughout the project and consideration is payable when invoiced. The
invoiced amount is shown as a contract liability on the balance sheet until such time as the performance
obligation has been met and recognised in revenue.
Revenue is recognised throughout the licence period and in the period in which the service occurs.
Customers are typically invoiced in arrears for usage rendered. The revenue is shown as a contract asset on
the balance sheet as the performance obligation has been met and released to the statement of
comprehensive income but the client has not yet been invoiced. Clients invoiced annually are held on the
balance sheet and the revenue released monthly as the performance obligation occurs.
Right to access the
software
Right to use the
software
These financial statements should be read in conjunction with the Auditor's report.
16
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
3REVENUE (CONTINUED)
30 June 202330 June 2022
$'000$'000
- -
Revenue from Enterprise software and licences
5,298 4,852
- -
Revenue from services and support
12,488 11,398
- -
Revenue from iSell
1,201 1,093
Revenue from hosting services
1,762 1,388
- -
Revenue from other fees
2 13
- - 20,751 18,744
Software and licencesServices and supportITQuoter RevenueExoHostedother fees
30 June 2023
$'000$'000$'000$'000$'000$'000
-
New Zealand
1,605 4,379 179 703 2 6,868
-
Australia
3,693 8,109 850 1,059 - 13,711
-
EMEA*
- - 154 - - 154
-
North America
- - 16 - - 16
-
Asia
- - 2 - - 2
- - 5,298 12,488 1,201 1,762 2 20,751
* Europe, Middle East and Africa
30 June 2022
$'000$'000$'000$'000$'000$'000
-
New Zealand
1,870 3,466 124 598 8 6,066
-
Australia
2,982 7,932 765 790 5 12,474
-
EMEA*
- - 152 - - 152
-
North America
- - 9 - - 9
Asia
- - 43 - - 43
- - 4,852 11,398 1,093 1,388 13 18,744
30 June 202330 June 2022
$'000$'000
Recurring revenue from Enterprise software licences
4,481 3,897
Contracted revenue from hosting and support agreements
4,171 3,325
Revenue from other services
10,849 10,396
19,501 17,618
- -
30 June 202330 June 2022
$'000$'000
Recurring revenue from iSell software licences
1,097 974
Revenue from other services
104 119
1,201 1,093
- -
30 June 202330 June 2022
$'000$'000
Revenue from services
49 33
49 33
Critical accounting judgements and estimates
The group does not expect to recognise any revenue on existing contracts outside the 12 months post year end.
iSell revenue
Revenue from
iSell
Total
Revenue from
software and
licences
Revenue from
other fees
Revenue by geographical
location
Revenue from
hosting services
Revenue from
hosting services
Revenue from
software and
licences
Total
Revenue from
services and
support
Kilimanjaro Consulting revenue
Revenue by geographical
location
Revenue from
iSell
Corporate revenue
Some contracts include multiple deliverables, such as software licences and implementation services. However, because the implementation does not include
material customisation to the software and could be provided by another party, the implementation services are accounted for as a separate performance
obligation from software licences. In this case, the transaction price will be allocated to each performance obligation based on the standalone selling prices.
Revenue from
services and
support
Revenue from
other fees
These financial statements should be read in conjunction with the Auditor's report.
17
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
4OPERATING EXPENSES
(a)Other gains and losses
30 June 202330 June 2022
$'000$'000
- - Net foreign exchange gains/(losses)(77) 32
(b)Finance income and costs
Interest income
Interest expense
30 June 202330 June 2022
$'000$'000
Finance income
Interest from financial assets held for cash management purposes
20 1
Interest from loans to related parties
- 20
Interest from other loans and receivables
- 1
20 22
Finance costs
Interest on bank overdrafts and loans
(239) (24)
Interest on lease liabilities
- (88)
(239) (112)
- - Net finance income and costs(219) (90)
(c)Other operating expenses
Low-value and short-term lease costs:
30 June 202330 June 2022
$'000$'000
Advertising and marketing
338 287
Amortisation
1,965 566
Auditors' remuneration
136 133
Bad and doubtful debts expense
120 71
Communications
161 167
Depreciation
840 788
Hosting costs
1,351 1,067
Insurance
86 98
Legal fees
330 98
Low-value and short-term lease costs
141 142
Professional services
134 59
Subcontractors
662 962
Travel expenses
245 84
Other operational expenses
894 979
- - 7,403 5,501
Other operating expenses include:
Interest income is recognised in the statement of comprehensive income using the effective interest method. The effective interest method calculates the amortised
cost of a financial asset or liability and allocates the interest income over the relevant period.
Interest costs are expensed in the period in which they are incurred.
Leases that are not classified as a right-of-use asset have been classified as low-value and short-term leases. Payments associated with short-term leases and
leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or
less. Low-value assets comprise ITequipment and small items of office furniture.
These financial statements should be read in conjunction with the Auditor's report.
18
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
4OPERATING EXPENSES (CONTINUED)
(i) Amortisation
30 June 202330 June 2022
$'000$'000
Amortisation of software (note 16)1,719 315
Amortisation of customer relationships (note 16)181 186
Amortisation of intellectual property (note 16)65 65
1,965 566
- -
(ii) Auditors' remuneration
30 June 202330 June 2022
$'000$'000
For auditing the Group financial statements
RSM Hayes Audit31 131
UHY Haines Norton103 -
Other Services
Audit of iSell Philippines (R.P. Mora Accounting and Law Office)2 2
136 133
- -
(iii) Bad and Doubtful Debts
30 June 202330 June 2022
$'000$'000
Bad debts recognised1 57
Bad debts recovered- (6)
Changes in provision for bad and doubtful debts119 20
120 71
- -
(iv) Depreciation
30 June 202330 June 2022
$'000$'000
Property plant and equipment (note 15)234 140
Right-of-use assets (note 17)606 648
840 788
- -
(d)Employee benefit expense
30 June 202330 June 2022
$'000$'000
Wages and salaries
14,668 14,060
Superannuation
1,028 905
Directors fees
88 92
- - 15,784 15,057
These financial statements should be read in conjunction with the Auditor's report.
19
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
5TAXATION
(a)Income tax recognised in profit or loss
Temporary differences that can reasonably be foreseen in the next accounting period have been recognised as a deferred tax asset.
30 June 202330 June 2022
$'000$'000
Current tax
Current tax on profits for the year
- -
Adjustments for current tax on prior periods
- 38
Total current tax expense
- 38
Total deferred tax expense/(benefit)
904 (265)
- Total income tax expense/(benefit)904 (227)
(b)Reconciliation of income tax expense to prima facie tax payable
30 June 202330 June 2022
$'000$'000
Profit before income tax
(9,848) (2,420)
Tax at the New Zealand domestic tax rate of 28%
(2,757) (678)
Adjusted for the tax effect of:
Non deductible expenses
719 308
Non assessable income
- (2)
Difference in overseas tax rates
(29) (50)
Impairment of intangible assets
1,818 -
Reversal of previously recognised tax losses
783 -
Other unrecognised timing differences and tax losses
370 195
Total deferred tax expense/(benefit)
904 (227)
-
- Total income tax expense/(benefit)904 (227)
(c) Current tax assets and liabilities
30 June 202330 June 2022
$'000$'000
Current tax assets
Income tax refundable/(payable)
24 (19)
- - 24 (19)
Deferred tax assets are reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow
all or part of the asset to be recovered.
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the
corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets
are recognised for all deductible temporary differences and unutilised tax losses to the extent that it is probable that taxable profits will be available against which
those deductible temporary differences and unutilised tax losses can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary
difference arises from the initial recognition (other than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit nor
the accounting profit.
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities
based on the current period’s taxable income. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the
reporting date.
These financial statements should be read in conjunction with the Auditor's report.
20
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
5TAXATION (CONTINUED)
(d)Deferred tax balances
30 June 202330 June 2022
$'000$'000
The balance comprises temporary differences attributable to:
Future benefit of losses incurred
- 783
Future benefit of provisions and accruals
234 207
Employee benefits
453 451
Contract liabilities
250 363
Lease liabilities
330 393
- -
Total deferred tax asset
1,267 2,197
30 June 202330 June 2022
$'000$'000
The balance comprises temporary differences attributable to:
Customer relationships
(58) (99)
Contract asset
(155) (199)
Future liability of provisions and accruals
(204) -
Right-of-use asset
(293) (358)
- -
Total deferred tax liability
(710) (656)
Movements
$'000$'000$'000$'000$'000
At 1 July 2021
26 (137) 680 686 1,255
(Charged)/credited
to profit or loss
9 38 103 136 286
-
At 30 June 2022
35 (99) 783 822 1,541
- - - -
Movements
$'000$'000$'000$'000$'000
At 1 July 2022
35 (99) 783 822 1,541
(Charged)/credited
to profit or loss
2 41 (783) (244) (984)
-
At 30 June 2023
37 (58) - 578 557
- - - -
Critical accounting judgements and estimates
(e) Imputation credits available for use
30 June 202330 June 2022
$'000$'000
New Zealand imputation credits available
10 -
The Group has recognised a deferred tax asset on its statement of financial position as at the reporting date. Significant judgement is required in determining if the
utilisation of deferred tax assets is probable. The recognition of deferred tax assets is based upon whether it is more likely than not that sufficient and suitable
taxable profits will be available in the future against which the reversal of temporary differences can be deducted. To determine the future taxable profits, reference
is made to the latest forecasts of future earnings of the Group. Where the temporary differences are related to losses, relevant tax law is considered to determine
the availability of the losses to offset against the future taxable profits.
Judgement is required to assess the deferred tax asset in relation to losses available. The balance represents the reasonable benefit that the Group is expected to
utilise in the next two financial years. The Directors have not recognised the benefit of unutilised tax losses beyond two years due to uncertainty with regards to
future shareholder continuity. This assessment was determined based on the budgeted profitability of the Group, but does not take into account the potential
impact of the dispute with MYOB on future profitability as detailed in note 26.
Customer
relationships
Tax lossesTotal
Provisions
& accruals
(inc employee benefits)
Subject to the provisions of the Income Tax Act 2007, the benefit of these credits may be passed to the shareholders as imputed tax paid on future dividends.
Right-of use
assets & lease
liabilities
Customer
relationships
Deferred tax liability
Deferred tax asset
Subject to the various income tax legislations being met the losses carried forward at 30 June 2023 are estimated to be $5,024,567 (NZ $3,893,681, AUS $1,130,886)
(last year: $4,310,063) of which $Nil has been recognised as a deferred tax asset (last year: $2,840,620). Deferred tax losses are not recognised in relation to iSell
Pty Limited, which has an estimated AUD4,860,965 of losses to carry forward (last year: AUD3,833,789).
Provisions
& accruals
(inc employee benefits)
Tax losses
Right-of use
assets & lease
liabilities
Total
These financial statements should be read in conjunction with the Auditor's report.
21
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
6EARNINGS PER SHARE
There are no instruments that could potentially dilute earnings per share.
30 June 202330 June 2022
Earnings for the purpose of basic and diluted earnings per share:
Net profit/(loss) attributable to shareholders ($'000)
(10,279) (1,836)
Weighted average number of ordinary shares for basic earnings per share (000s)
16,901 16,158
Basic and diluted earnings per share (cents)
(60.82) (11.36)
7TRADE AND OTHER RECEIVABLES
Trade and other receivables are recognised at cost less any provision for impairment. All trade and other receivables have been classified as current assets.
30 June 202330 June 2022
$'000$'000
Trade receivables
2,756 2,992
Related party receivable (note 21(d)).
3 4
Other receivables
1,057 144
Provision for impairment
(241) (122)
3,575 3,018
Prepayments
336 172
- -
3,9113,190
Allowance for impairment loss
The average credit period on sales of licences and services is 40 days. No interest is charged on outstanding trade receivables.
Bad debts are written-off when they are considered to have become uncollectable.
The aging of the receivables and allowance for expected credit losses provided for above are as follows:
Expected credit loss rateCarrying amountAllowance for impairment
30 June 202330 June 202230 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000
0-30 days
1.0%1.0%
2,037 2,244
2021
31-60 days
5.0%5.0%
425 410
2121
61-90 days
50.0%10.0%
93 110
4711
+91 days
75.0%30.0%
204 232
15369
2,7592,996241122
- - - -
30 June 202330 June 2022
$'000$'000
At period start
(122) (102)
Additional provisions recognised(125)(80)
Receivables written off during the year660
- - At period end
(241)(122)
The Group measures the loss allowance on the balance of trade receivables at an amount equal to lifetime expected credit losses (ECL). The ECL on trade
receivables are estimated using a provision matrix referring to past default experience of the debtors and an analysis of the debtors' current financial position, adjusted
for factors that are specific to the debtors, general economic conditions in which the debtors operate and an assessment of both the current and forecast direction of
conditions at the reporting date.
Basic earnings per share is calculated by dividing the profit attributable to shareholders of the Company by the weighted average number of shares on issue during
the year. Diluted earnings per share assumes conversion of all dilutive potential ordinary shares in determining the denominator.
Movements in the provision for impairment loss were as follows:
These financial statements should be read in conjunction with the Auditor's report.
22
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
8CONTRACT ASSETS
30 June 202330 June 2022
$'000$'000
- -
Contract assets669831
The reconciliation of the values at the beginning and end of the current and previous financial year are set out below:
30 June 202330 June 2022
$'000$'000
Balance at the beginning of the period
831713
Transfer from contract assets to expenses
(831)(713)
Costs incurred for work performed but not yet recognised
669831
Balance at the end of the period
669831
9OTHER ASSETS
30 June 202330 June 2022
$'000$'000
Security deposits
36 34
Convertible note
- 518
- -
36552
Classified as
Current - 518
Non-current36 34
36 552
10TRADE AND OTHER PAYABLES
30 June 202330 June 2022
$'000$'000
Trade payables
1,516 1,278
Related party payables (note 21(d)).
19 45
Payroll taxes and other statutory liabilities
658 707
Other payables and accruals
1,237 933
- -
3,4302,963
A contract asset is recognised for amounts relating to services rendered but not yet recognised. The costs recognised as contract assets are released to the
statement of comprehensive income when the related revenue for the contract is released.
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year which are unpaid. The amounts are unsecured and
are usually paid within 30 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the
reporting period. They are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method.
These financial statements should be read in conjunction with the Auditor's report.
23
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
11PROVISIONS
Wages, salaries, annual leave, long service leave
30 June 202330 June 2022
$'000$'000
- - Employee benefits
2,1801,998
Leashold Make Good Provision
161
2,3411,998
Classified as
- - Current 1,985 1,696
- - Non-current356 302
- - 2,341 1,998
12CONTRACT LIABILITIES
30 June 202330 June 2022
$'000$'000
Contract liabilities
1,452 1,882
Deposits from customers
237 700
- - Contract liabilities1,689 2,582
The reconciliation of the values at the beginning and end of the current and previous financial period are set out below:
30 June 202330 June 2022
$'000$'000
Balance at the beginning of the period
2,5822,362
Decrease due to revenue recognised from performance obligations satisfied
(2,582)(2,244)
Invoices raised for work performed but not yet recognised
1,6892,464
Balance at the end of the period
1,6892,582
Liabilities for wages and salaries, including non-monetary benefits, and annual leave are recognised in respect of employees’ services up to the reporting date.
They are measured at the amounts expected to be paid when the liabilities are settled. Liabilities recognised in respect of other long-term employee benefits are
measured at the present value of the estimated future cash outflows expected to be made by the Group in respect of services provided by employees up to the
reporting date.
A contract liability is recognised for amounts received or due relating to services performed or expected to be performed. The Group's revenue recognition policy is
stated at Note 3 which details when each class of revenue is released to the profit and loss.
These financial statements should be read in conjunction with the Auditor's report.
24
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
13INVESTMENTS IN JOINT VENTURES AND ASSOCIATES
30 June 202330 June 2022
$'000$'000
Carrying amount at the beginning of the period285 833
New investment in joint ventures and associates957 -
-
Equity earnings/(losses) from associates and joint ventures
(330) (556)
- -
Other gains/(losses) related to associates and joint ventures
- 8
- -
912285
30 June 202330 June 2022
$'000$'000
Datagate Innovation Limited912 285
- -
912285
(a)Joint ventures and associates
Percentage ownership
30 June 202330 June 2022
Datagate Innovation LimitedNew ZealandSoftware sales32.96 31.95
On acquisition of the investment in an associate or a joint venture, any excess of the cost of the investment over the Group’s share of the net fair value of the
identifiable assets and liabilities of the investee is recognised as goodwill, which is included within the carrying amount of the investment.
Investments in joint ventures and associates are accounted for using the equity method and are measured in the statement of financial position at cost adjusted for the
Group's share of the profit or loss and other comprehensive income of the associate or joint venture. Goodwill relating to associates and joint ventures is included in
the carrying amount of the investment.
If the carrying amount of the equity accounted investment exceeds its recoverable amount, it is written down to the latter. When the Group's share of accumulated
losses in an associate or joint venture equals or exceeds its carrying value, the Group does not recognise further losses, unless it has incurred obligations or made
payments on behalf of the associate or joint venture.
The requirements of NZ IAS 36 are applied to determine whether it is necessary to recognise any impairment loss with respect to the Group’s investment in an
associate or a joint venture. When necessary, the entire carrying amount of the investment (including goodwill) is tested for impairment in accordance with NZ IAS 36
as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs of disposal) with its carrying amount. Any impairment loss
recognised is not allocated to any asset, including goodwill that forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognised
in accordance with NZ IAS 36 to the extent that the recoverable amount of the investment subsequently increases.
The Group's joint venture and associates at 30 June 2023 are set out below. The country of incorporation or registration is New Zealand, their principal places of
business are New Zealand and North America.
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement. Joint control
is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the
parties sharing control.
An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant influence is the
power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.
Investment by joint venture or associate
Carrying amount of joint ventures and associates
Principal Activity
Country of incorporation
Name of Entity
These financial statements should be read in conjunction with the Auditor's report.
25
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
13INVESTMENTS IN JOINT VENTURES AND ASSOCIATES (CONTINUED)
(b)Summary financial information
30 June 202330 June 2022
$'000$'000
Net assets/(liabilities)227(1,131)
Proportion of the Group's ownership interest in the equity accounted investment75(361)
Goodwill837646
Carrying amount of the Group's interest in the equity accounted investment
912285
30 June 202330 June 2022
$'000
$'000
Assets and liabilities of joint ventures are as follows:
Current assets
1,032 1,299
Non-current assets
18 45
Current liabilities
(388) (2,027)
Non-current liabilities
(435) (448)
227(1,131)
Results of equity accounted investment
$'000$'000
Revenue
3,169 2,243
Losses after taxation
(1,032) (1,739)
Total comprehensive income
(1,032) (1,739)
Group share of loss
(330)(556)
The Enprise Group recorded the following within its statement of comprehensive income for the period related to Datagate :
Gain on dilution- 8
Share of operating loss(330) (556)
Total recognised within the group's profit
(330)(548)
30 June 202330 June 2022
$'000
$'000
Balance sheet
Cash and cash equivalents
586 955
Trade and other receivables
444 344
Trade and other creditors
(388) (195)
Property, plant and equipment
16 26
Intangible assets
2 19
Profit and loss
Depreciation and amortisation
25 82
Interest income
10 2
Datagate Innovation Limited (Datagate) is a software company which provides online billing solutions for telecommunication services and other usage based services.
Datagate Innovation Limited
Other key financial information
Datagate has been involved in a number of capital raising events, the last being in November 2022 where the Group acquired an additional 92,610 shares. Enprise
acquired 70,545 shares from a former Datagate director for $175,363.
The group participated in the convertible note offering in December 2021. Details of the convertible note are disclosed in Note 10. The convertible note was
excercised on 18 November 2022, as a result Enprise acquired an additional 237,472 shares.
Datagate is a limited liability company whose legal form confers separation between the shareholders and the company itself. Datagate is governed by a Shareholder
Agreement. The Shareholders Agreement states that at least 75% of the board of directors are required to approve all relevant activities. Up to March 2021, Enprise
had the ability to appoint one out of three directors and therefore previously had joint control. Furthermore, the parties to the joint arrangement have rights to the net
assets of the arrangement on wind up. As a result of an additional director being appointed to the Board in March 2021, Enprise is no longer considered to have joint
control, but retains significant influence over this investment. The investment remains accounted for under the equity method however.
The Board is comfortable that there is no impairment to the carrying value of Datagate. Recent share trades at $2.486 per share would value Datagate at
$18,182,492. Enprise's share would have an implied value of $5,993,806 which would be substantially higher than the carrying value. If the Board decided to
liquidate this asset the recovery is expected to be significantly higher than the carrying value.
Summary of joint venture's financial statements
These financial statements should be read in conjunction with the Auditor's report.
26
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
14INVESTMENTS IN OTHER ENTITIES
30 June 202330 June 2022
$'000$'000
Carrying amount at the beginning of the year627 687
- - Changes in fair value of other investments(175) (60)
Share buy back- -
- -
452627
30 June 202330 June 2022
$'000$'000
- - Vadacom Holdings Limited
452627
Vadacom Holdings Limited
The table below summarises the quantitative information about the significant unobservable inputs used in this level 3 fair value measurement.
Range of inputs
20232022
Recurring revenue ($'000)2,276 2,578
Non recurring revenue ($'000)897 1,037
Recurring revenue multiple3.05x3.91x
Non recurring revenue multiple1.0x1.0x
At 30 June 2023, the shares in Vadacom Holdings Limited have been independently valued at $9.55 (last year: $13.47) resulting in a loss of $175,365 (last year: loss
of $59,579). This gain/loss has been recognised as other comprehensive income.
Relationship of unobservable inputs to fair value
Increasing recurring revenue, non recurring revenue, the recurring revenue multiple,
and the non recurring revenue multiple each by 5% would increase fair value by
$51,020 (last year: 5%; $70,990). Lowering each of the above inputs by 5% would
decrease fair value by $48,530 (last year: 5%; $67,530).
Carrying amount of investments in other entities
Unobservable inputs
Management continues to hold the assets for the medium to long term and the assets are therefore recognised as non-current. The Group revalued the investments
at fair market value at the end of the financial year.
The Group has made a decision to adopt NZ IFRS 9 to measure the equity investment in Vadacom Holdings Limited at fair value through other comprehensive income
(FVOCI).
During the 2021 financial year Vadacom Limited purchased back shares through a share buy back. Enprise considers this repayment a recovery of part of the cost of
the investment. A portion of the buyback was repaid during the year, the balance has been deferred and is recorded as a related party loan (refer note 22(e)).
In November 2017, the Group acquired a 6.49% shareholding in Vadacom Holdings Limited, a cloud based VOIP phone and virtual PABX provider. Subsequent
changes in shares since has resulted in a reduction of Enprise's shareholding to 6.35% at balance date.
These financial statements should be read in conjunction with the Auditor's report.
27
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
15PROPERTY PLANT AND EQUIPMENT
Computer equipment20-50%
Furniture and fittings10-50%
Office equipment10-50%
$'000$'000$'000$'000
At 1 July 2021
Cost452 293 128 873
Accumulated depreciation(275) (200) (94) (569)
Net book value177 93 34 304
Period ended 30 June 2022
Opening net book value amount177 93 34 304
Additions165 2 14 181
Depreciation charge(107) (19) (14) (140)
Gain/loss on disposal(5) - - (5)
Foreign exchange gain/(loss)5 2 1 8
Closing net book value235 78 35 348
As at 30 June 2022
Cost622 297 143 1,062
Accumulated depreciation(387) (219) (108) (714)
- Net book value235 78 35 348
Year ended 30 June 2023
Opening net book value amount- 235 78 35 348
Additions183 62 - 14 259
Disposals- - - - -
Depreciation charge(85) (119) (14) (16) (234)
Gain/loss on disposal- - - - -
Foreign exchange gain/(loss)- 16 - (1) 15
Closing net book value98 194 64 32 388
As at 30 June 2023
Cost183 700 295 156 1,334
Accumulated depreciation(85) (506) (231) (124) (946)
- Net book value98 194 64 32 388
- - - -
Total
Property, plant and equipment is stated at historical cost less accumulated depreciation and any accumulated impairment losses. Such costs include the cost of
replacing parts that are eligible for capitalisation when the cost of replacing the parts is incurred. The cost is recognised in the carrying amount of the plant and
equipment as a replacement only if it is eligible for capitalisation. All other repairs and maintenance are recognised in the statement of comprehensive income as
incurred.
Furniture
and fittings
Office
equipment
Leasehold
Improvements
Depreciation on fixed assets is calculated using the diminishing value method to allocate their costs, net of their residual values over their estimated useful lives as
follows:
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use.
The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year end.
Computer
equipment
These financial statements should be read in conjunction with the Auditor's report.
28
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
16INTANGIBLE ASSETS
Goodwill
Customer relationships
Software
$'000$'000$'000$'000$'000
At 1 July 2021
Cost- 3,086 1,264 7,538 11,888
Accumulated amortisation and impairment- (373) (625) - (998)
Net book value- 2,713 639 7,538 10,890
Period ended 30 June 2022
Opening net book value amount- 2,713 639 7,538 10,890
Additions325 305 - - 630
Exchange differences- 83 12 182 277
Amortisation charge(65) (315) (186) - (566)
Closing net book value260 2,786 465 7,720 11,231
At 30 June 2022
Cost325 3,474 1,276 7,720 12,795
Accumulated amortisation and impairment(65) (688) (811) - (1,564)
- Net book value260 2,786 465 7,720 11,231
Year ended 30 June 2023
Opening net book value amount260 2,786 465 7,720 11,231
Additions- 517 - - 517
Exchange differences- (42) (7) - (49)
Amortisation charge(65) (1,719) (181) - (1,965)
Impairment charge- (165) (128) (6,493) (6,786)
Closing net book value195 1,377 149 1,227 2,948
- - -
At 30 June 2023
Cost325 3,949 1,269 1,227 6,770
Accumulated amortisation and impairment(130) (2,572) (1,120) - (3,822)
- Net book value195 1,377 149 1,227 2,948
"In-house" developed or acquired software costs are capitalised on completion and amortised on a straight-line basis over the period of their expected benefit,
being their finite life of 3-5 years. Employment costs associated with developing the software are capitalised when the costs are incurred. The amount of the
charges capitalised is based on the proportionate time each employee spends on developing the software.
For the purpose of impairment testing, goodwill has been allocated to the cash-generating units (CGU). The impairment test is based on either an estimated
recoverable amount (value in use) or the fair value less costs. Estimated future cash flow projections are based on the Group's five-year business plan for the
business units.
Customer relationship costs are carried at cost (being assessed from value on acquisition) less accumulated amortisation and accumulated impairment losses. This
intangible asset has been assessed as having a finite life and is amortised using the straight line method over a period of 5 years. The amortisation has been
recognised in the statement of comprehensive income within depreciation and amortisation expense. If an impairment indication arises, the recoverable amount is
estimated and an impairment loss is recognised to the extent that the recoverable amount is lower than the carrying amount. No impairment has been assessed for
the current financial year (last year: nil).
Intellectual
Property
Goodwill is assessed as having an indefinite useful life and is not amortised but is subject to impairment testing annually or whenever there are indications of
impairment.
The amortisation of the intangible asset, Software has been made which reflects the boards view that the estimated useful life of the internally generated asset is 4
years not 10 years as used in prior financial statements.
Goodwill arises on the acquisition of subsidiaries and represents the excess of the consideration paid above the fair value of the net identifiable assets, liabilities
and contingent consideration acquired.
Software
Customer
relationships
GoodwillTotal
These financial statements should be read in conjunction with the Auditor's report.
29
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
16INTANGIBLE ASSETS (CONTINUED)
Significant intangible assets held are as follows:
Carrying amount
$'000
Customer relationships - Kilimanjaro Consulting Pty Limited103 18 months
Customer relationships - iSell Pty Limited46 23 months
Software - ITQuoter1,339 12-48 months
Intellectual Property233 36 months
30 June 202330 June 2022
$'000$'000
Kilimanjaro Consulting - New Zealand
1,227 1,227
Kilimanjaro Consulting - Australia
- 5,455
iSell
- 1,038
- -
1,2277,720
(a)Impairment Testing - Kilimanjaro
Australian Cash Generating Unit
30 June 2023
Recoverable Amount 270
Carrying Amount 5,869
Impairment Loss (5,599)
The table below summarises the quantitative information about the significant unobservable inputs used in this level 3 fair value measurement.
The discounted cash flow valuation used to determine the CGU's recoverable amount in the current period uses 5 years of projected cash flows and a terminal value.
Key Assumption
ValueBasis for determining value assigned to key assumptions
Growth Rate3.21%Determined based on historical trend growth and management's future expectations
Weighted average cost of capital13.47%
Sensitivity Analysis
Current ValueReasonably possible changeImpact of change
Growth Rate3.21%Decrease by 3%Additional impairment loss of $270,000
Weighted average cost of capital13.47%Increase by 1%N/A, terminal cash flow estimate is negative
.
An independent assessment of the fair value of the Kilimanjaro cash generating units (CGU's) was conducted at 30 June 2023, for the purpose of considering the fair
value less cost of disposal of the CGU. The Level 3 fair value estimate was lower than the carrying value of the Kilimanjaro AU cash generating unit, but higher than
the NZ cash generating unit. Information pertaining to each CGU is presented below.
Determined primarily based on external sources of information, adjusted for entity specific risks.
The carrying amounts of goodwill allocated to the cash generating units are outlined below:
The valuation technique has been adjusted from a earnings multiple valuation methodology in the prior year to a discounted cash flow methodology in the current year.
This revised methodology was adopted to more accurately capture expected future changes in the various revenue streams of the entity, and their divergent impact on
profitability.
Remaining
amortisation period
These financial statements should be read in conjunction with the Auditor's report.
30
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
16INTANGIBLE ASSETS (CONTINUED)
New Zealand Cash Generating Unit
The table below summarises the quantitative information about the significant unobservable inputs used in this level 3 fair value measurement.
Key Assumption
ValueBasis for determining value assigned to key assumptions
Growth Rate2.93%Determined based on historical trend growth and management's future expectations
Weighted average cost of capital14.49%
Sensitivity Analysis
Current ValueReasonably possible change
Growth Rate2.93%No reasonably possible change which would cause an impairment loss
Weighted average cost of capital14.49%No reasonably possible change which would cause an impairment loss
.
(b)Impairment Testing - iSell Pty Limited
30 June 2023
Recoverable Amount 2,039
Carrying Amount 3,620
Impairment Loss (1,581)
The table below summarises the quantitative information about the significant inputs used in this level 2 fair value measurement.
Key Assumption
Value
Basis for determining value assigned to key assumptions
Value per shareA$0.12
Determined based on capital raise conducted subsequent to year end
Sensitivity Analysis
Current Value
Reasonably possible changeImpact of change
Value per shareA$0.12
Decrease by 10%Additional impairment loss of $204,000
The valuation technique has been adjusted from a earnings multiple valuation methodology in the prior year to a comparable sales methodology in the current year.
This revised methodology was adopted as a capital raising conducted after year end provided more direct and comparable valuation evidence as to the value of iSell
shares.
An independent assessment of the fair value of the iSell cash generating unit (CGU's) was conducted at 30 June 2023, for the purpose of considering the fair value
less cost of disposal of the CGU. The Level 2 fair value estimate was lower than the carrying value of the cash generating unit. Information pertaining to each CGU is
presented below.
Determined primarily based on external sources of information, adjusted for entity specific risks.
These financial statements should be read in conjunction with the Auditor's report.
31
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
17RIGHT-OF-USE ASSETS
PropertyTotal
$'000$'000
At 1 July 2021
Cost2,147 2,147
Accumulated depreciation(579) (579)
Net book value1,568 1,851
Year ended 30 June 2022
Opening net book value amount1,568 1,568
Additions490 490
Lease Adjustments(83) (83)
Exchange differences13 13
Depreciation charge(648) (648)
Closing net book value1,340 1,340
At 30 June 2022
Cost2,296 2,296
Accumulated amortisation and impairment(956) (956)
Net book value1,340 1,340
Year ended 30 June 2023
Opening net book value amount1,340 1,340
Additions373 373
Lease Adjustments- -
Exchange differences(9) (9)
Depreciation charge(606) (606)
- Closing net book value1,098 1,098
At 30 June 2023
Cost2,648 2,648
Accumulated amortisation and impairment(1,550) (1,550)
- Net book value1,098 1,098
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter.
Right-of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which comprises the initial amount of the lease
liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, and any initial direct costs
incurred by the lease.
The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms of 12 months or less and leases of low-
value assets. Lease payments on these assets are expensed to profit or loss as incurred.
The Group's right-of use assets consist only of property leases which up until 31 March 2019 were classified as operating leases. Payments made under operating
leases (net of any incentives received from the lessor) were charged to profit or loss on a straight-line basis over the period of the lease.
The sale of the Walker Street, Sydney office building to a new landlord presented an opportunity to renegotiate and relinquish a portion of the occupancy. The new
lease commenced on 1 February 2023 and is for 24 months.
The Wellington lease expired in May 2023 and has moved to a month by month arrangement. There were no other long term leases negotated during the year.
From 1 April 2019, leases are recognised as a right-of-use asset and a lease liability at the lease commencement date.
These financial statements should be read in conjunction with the Auditor's report.
32
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
18BORROWINGS
Cash on hand and at bank
- - For the purposes of the statement of cash flows, cash and cash equivalents consist of cash on hand and at bank.
Borrowings
30 June 202330 June 2022
$'000$'000
Current cash on hand / (borrowings)
- -
Cash on hand and at bank
1,178 1,546
Bank overdraft
(949) (330)
Cash and cash equivalents
229 1,216
-
Bank borrowings
(1,147) (812)
-
Other borrowings
- (41)
Current borrowings
(918) 363
- -
Non-current borrowings
- -
Net cash on hand
(918)363
(a)Summary of borrowing arrangements
- An overdraft facility of $1,000,000
(b)Reconciliation of liabilities arising from financing activities
Bank borrowingsOther borrowingsLease Liabilities
$'000$'000$'000
At 1 July 2021
- 50 1,659
Non-cash changes- 3 402
Financing cash inflows1,000 - -
Financing cash outflows(188) (12) (612)
Exchange differences- - 16
-
Balance as at 30 June 2022
812 41 1,465
Non-cash changes- - 373
Financing cash inflows723 - -
- - Financing cash outflows(388) (42) (595)
Exchange differences- 1 (11)
- Balance as at 30 June 20231,147 - 1,232
- - -
The table below details changes in the Group’s liabilities arising from financing activities, including both cash and non-cash changes. Liabilities arising from financing
activities are those for which cash flows were, or future cash flows will be, classified in the Group’s statement of cash flows as cash flows from financing activities:
- A commercial loan of $2,000,000 of which $nil is available to redraw at 30 June 2023 (last year: $723,385). The loan matures on 31 October 2023
and requires the next quarterly payment of $99,900. The bank's debt is secured by PPSR over all the assets of Enprise Group Limited, Kilimanjaro Consulting Pty
Limited and Kilimanjaro Consulting Limited (formerly Enprise Solutions Limited).
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference
between the net proceeds and the redemption amount is recognised in the profit and loss over the period of the borrowings using the effective interest method.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the balance
date.
- The ex-employee debt of AU$37,467 was repaid during the year, it was part of an original settlement on 30 June 2015 of AU$120,000.
The Group acquired historical unsecured borrowings and amounts owing to third parties on the acquisition of iSell Pty Limited.
The Bank of New Zealand (BNZ) has provided the following facilities to Enprise Group Limited:
Cash and cash equivalents in the statement of financial position are comprised of cash at bank and in hand and short term deposits with an original maturity of
three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
The Group is currently under the notice of covenant non-waiver issued by the BNZ in September 2023 in respect of the breaches to both the interest cover and
financial debt ratios. The year end results have further continued to have these two covenants breached at year end. See note 26 for details of notice of covenant
non-waiver subsequent to balance date.
The other borrowing in the prior period refers to the recognised liability to a former iSell employee who was claiming a higher balance that iSell is defending. This has
been settled subsequent to balance date and included as an accrual in the financial statements.
These financial statements should be read in conjunction with the Auditor's report.
33
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
19LEASE LIABILITIES
30 June 202330 June 2022
$'000$'000
- - Lease liabilities1,232 1,465
Classified as
- - Current 498 495
- - Non-current734 970
- - 1,232 1,465
(a)Remaining contractual cash flows
Maturity analysis of the contractual undiscounted cash flows are as follows:
30 June 202330 June 2022
$'000$'000
Not later than one year 551 562
Later than one year but not later than 5 years821 939
Later than 5 years - 158
1,372 1,659
(b)Amounts recognised in statement of comprehensive income
30 June 202330 June 2022
$'000$'000
Interest on lease liabilities78 88
Expenses relating to short term leases146 142
224 230
(c)Amounts recognised in statement of cash flows
30 June 202330 June 2022
$'000$'000
Interest element of lease payments78 88
Principal elements of lease payments595 612
- -
(d)Critical accounting judgements and estimates
Lease Term
Incremental borrowing rate
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured if there is a change in the following: future
lease payments arising from a change in an index or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a
lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset is fully
written down.
Cash outflows recognised within cash flows from operating activities
Where the interest rate implicit in a lease cannot be readily determined, an incremental borrowing rate is estimated to discount future lease payments to measure
the present value of the lease liability at the lease commencement date. Such a rate is based on what the Group estimates it would have to pay a third party to
borrow the funds necessary to obtain an asset of a similar value to the right-of-use asset, with similar terms, security and economic environment.
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of the lease payments to be made
over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group's incremental borrowing rate.
Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be
paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated
termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred.
Cash outflows recognised within cash flows from financing activities
The lease term is a significant component in the measurement of both the right-of-use asset and lease liability. Judgement is exercised in determining whether
there is reasonable certainty that an option to extend the lease or purchase the underlying asset will be exercised, or an option to terminate the lease will not be
exercised, when ascertaining the periods to be included in the lease term. In determining the lease term, all facts and circumstances that create an economical
incentive to exercise an extension option, or not to exercise a termination option, are considered at the lease commencement date. Factors considered may include
the importance of the asset to the Group's operations; comparison of terms and conditions to prevailing market rates; incurrence of significant penalties; existence
of significant leasehold improvements; and the costs and disruption to replace the asset. The Group reassesses whether it is reasonably certain to exercise an
extension option, or not exercise a termination option, if there is a significant event or significant change in circumstances.
These financial statements should be read in conjunction with the Auditor's report.
34
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
20EQUITY
(a)Share capital
Number of authorised sharesShare capital
Contributed equity - ordinary shares
30 June 202330 June 202230 June 202330 June 2022
sharesshares$'000$'000
Opening ordinary shares16,157,699 16,157,699 11,010 11,010
Rights issue1,210,662 - 1,017 -
Staff share issue61,700 - 53
- - 17,430,061 16,157,699 12,080 11,010
(b)Dividends
30 June 202330 June 202230 June 202330 June 2022
cents per sharecents per share$'000$'000
Final dividend for the period ended 30 June 2021- 2.50 - 404
Interim dividend for the period ended 30 June 2022- - - -
Final dividend for the period ended 30 June 2022- - - -
Interim dividend for the period ended 30 June 2023- - - -
- - - 2.50 - 404
21RELATED PARTY TRANSACTIONS
(a)Interest in other Entities
(b)Ultimate Parent
The ultimate parent entity and controlling party is Enprise Group Limited. The Parent is domiciled in New Zealand.
(c)Transactions with Related Parties
During the period, the Group entered into the following trading transactions with related parties.
Sale of services Purchase of services
Name of Entity
30 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000
Vadacom Limited*36 37 - -
Next Telecom*- - 35 32
Datagate Innovation Limited13 - - -
Nicholas Paul (Director) - consultancy fees (see note 21(f))- - - 73
49 37 35 105
* Vadacom Limited and Next Telecom Limited are subsidiaries of Vadacom Holdings Limited
On 24 November 2022, 1,210,662 shares were issued in the rights issue at $0.85 per share. On 1 March 2023, 61,700 shares were issued to staff under the staff
share purchase scheme at $0.85 per share.
Share capital comprises of ordinary shares only. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net
of tax, from the proceeds.
All shares on issue are fully paid. All ordinary shares rank equally with one vote attached to each fully paid ordinary share and have equal dividend rights and no par
value.
The Group's principal subsidiaries are set out in note 1(d). Unless otherwise stated, they have share capital consisting solely of ordinary shares that are held directly
by the Group. The country of incorporation or registration is also their principal place of business.
These financial statements should be read in conjunction with the Auditor's report.
35
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
21RELATED PARTY TRANSACTIONS (CONTINUED)
(d)Outstanding balances arising from sales/purchases of goods and services
The following balances are outstanding at the end of the reporting period in relation to transactions with related parties.
Amounts owed by related partiesAmounts owed to related parties
Name of Entity
30 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000
Next Telecom Limited- - 7 5
Vadacom Limited3 4 - -
Nightingale Partners (Lindsay Phillips)- - 12 40
3 4 19 45
(e)Loans to/from related parties
Amounts owed by related partiesAmounts owed to related parties
Name of Entity
30 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000
Vadacom Holdings Limited32 73 - -
Datagate Innovation Limited- 518 - -
32 591 - -
- - Current- - - -
Non-Current32 591 - -
32 591 - -
(f)Key management personnel
Key management compensation to directors of the Group was as follows:
30 June 202330 June 2022
$'000$'000
Salaries, bonuses and commissions517 582
Superannuation36 34
Other post-employment benefits8 19
Consultancy fees- 73
Directors' fees88 92
649 800
Key management did not receive any termination benefits during the period (last year: nil).
Key management received post-employment or long term benefits of $43,146 (last year: $49,750).
(g)Directors' fees
Directors received director's fees as detailed below:
30 June 202330 June 2022
$'000$'000
L Phillips25 40
G Cooper- -
N Paul35 25
R Baskind- -
M Fong13 27
Dr A Varghese-Cowan15 -
- -
88 92
The following balances are outstanding at the end of the reporting period.
These financial statements should be read in conjunction with the Auditor's report.
36
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
22SUBSIDIARIES WITH NON CONTROLLING INTERESTS
iSell Pty Limited
Transactions with non-controlling interests recognised in equity
$'000 $'000 $'000
Purchase from non-controlling interests(10) (1) (11)
Proceeds from rights issue in iSell Pty Limited to non-controlling interests- - -
Total transactions with non-controlling interests
(10)(1)(11)
(a)Summary of financial position
30 June 202330 June 2022
$'000$'000
Assets
Cash and cash equivalents
44 70
Trade and other receivables
73 151
Contract assets
68 52
Staff receivables - non current
- -
Property plant and equipment
39 30
Intangible assets
1,406 3,837
Right-of-use assets - non-current
- -
Deferred tax asset
4 -
Other non-current assets
9 10
Total assets1,643 4,150
Liabilities
Trade and other payables
(445) (207)
Contract liabilities
(175) (180)
Provisions - non-current
(201) (197)
Borrowings - non current
- (41)
Lease liabilities - non-current
- -
Related party payable
(1,175) (253)
Total liabilities(1,996) (878)
Net assets
(353)3,272
- -
(b)Summary of financial performance
30 June 202330 June 2022
$'000$'000
Revenue from contracts with customers
1,199 1,093
Net profit/(loss)
(1,745) (1,422)
Other comprehensive income
- -
Total comprehensive income/(loss)
(1,745)(1,422)
30 June 202330 June 2022
24.97% - 24.75%28.86% - 24.97%
$'000$'000
- Total comprehensive income/(loss) attributable to NCI
(473)(357)
(c)Summary of statement of cash flows
Enprise Group Limited acquired a controlling stake in iSell on 27 May 2020. Subsequent to this date, Enprise has purchased shares from non controlling interests and
engaged in rights issues that have increased Enprise's shareholding in iSell, ultimately resulting in a non-controlling interest percentage of 24.97% at 30 June 2023
(last year: 24.97%).
Enprise Group Limited consolidates 100% of iSell's results and presents the portion of profit/(loss) and other comprehensive income attributable to a non-controlling
interest (NCI).
During the year iSell Pty Limited incurred total operating cash outflows of $AU69,948 (last year: $1,262,516) total investing outflows of $AU493,459 (last year:
$328,861) and total financing inflows of $AU539,442 (last year: $1,042,755).
Non-controlling
interests
Attributable to
the parent
Total
These financial statements should be read in conjunction with the Auditor's report.
37
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
23CASH FLOW RECONCILIATION
30 June 202330 June 2022
$'000$'000
Profit/(Loss)
(10,752) (2,193)
Adjustments for:
Depreciation on property plant and equipment
234 118
Loss on disposal of property plant and equipment
- 5
Depreciation on right-of-use assets
606 648
Amortisation on intangible assets
1,965 588
Net loss/(gain) on foreign exchange20 5
Impairment of intangible assets6,786 -
Share of loss from equity accounted investments330 548
Movement in current and deferred tax904 (227)
Movements in working capital
(Increase)/decrease in trade and other receivable
(826) (326)
(Increase)/decrease in contract assets
95 (100)
(Increase)/decrease in income taxes receivable(43) 18
Increase/(decrease) in trade and other payables435 357
Increase/(decrease) in provisions133 245
Increase/(decrease) in contract liabilities(612) 168
- -
Net cash inflow/(outflow) from operating activities(725)(146)
-
24CONTINGENT LIABILITIES
There were no material contingent liabilities or assets at balance date (last year: nil).
25SUBSEQUENT EVENTS AFTER BALANCE DATE
(a)Notice of non-waiver of banking covenants
(b)
Dispute with MYOB
(c)
Rights Issue
(d)
iSell Rights Issue
Cash flows are included in the statement of cash flows on a gross basis and includes the GST component of cash flows arising from investing and financing activities,
which is recoverable from, or payable to, the taxation authority is classified as part of operating cash flows.
Kilimanjaro Consulting Pty Ltd (“Kilimanjaro”), has resolved its dispute with MYOB Australia Pty Ltd on terms that will see the parties continue as committed partners in
the marketing of the MYOB Advanced and Exo products. The terms, which are confidential, will result in the termination of the litigation commenced by Kilimanjaro in
the Federal Court of Australia, with each party paying its own legal costs. Kilimanjaro is confident that, with this litigation now resolved, it will be able to apply all its
energy towards maintaining and growing its position as one of the major Channel Partners of MYOB.
Reconciliation of net profit to net cash flows from operations:
Enprise was in breach of their BNZ Loan covenants at year end. BNZ has provided a notice of non-waiver of the 30 June 2023 banking interest cover and leverage
covenant on 15 September 2023. BNZ advised that it does not waive or give up its rights to any breach obligation, however BNZ advise that they will not be taking
any action at this time and thier right to take action regading this breach of obligation continues in full.
Enprise concluded a 1 for 5 rights issue on 22 Septemeber 2023 issuing 2,637,996 new shares ranking pari pasu with the existing issued capital at 50 cents per share
which raised $1,318,998 as per the NZX annoucement dated 29 September 2023.
iSell closed applications for a rights issue on 14 Septemeber 2023 at 12 cents per share. The under writing is subject to confidential conditions that are yet to be
fullfilled. The valuation of the rights issue was utilised in assessing the iSell impairment (see Note 16 (b))
These financial statements should be read in conjunction with the Auditor's report.
38
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
26FINANCIAL RISK MANAGEMENT, OBJECTIVES AND POLICIES
(a)Interest rate risk
The local operational bank accounts do not earn interest.
ProfitEquity
30 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000
+1% (100 basis points)(6) 3 (6) 3
- 1% (100 basis points)6 (3) 6 (3)
(b)Credit risk
The Group does not hold any credit derivatives to offset its credit exposure.
(c)Liquidity risk
Contractual maturity analysisless than 6 mths6 - 12 months1 - 3 years> 3 yearsTotal
30 June 2023$'000$'000$'000$'000$'000
-
Trade and other payables3,430
- - - 3,430
Bank overdraft949 -
- - 949
Term loan1,147 - - - 1,147
Lease liabilities277 274 496 325 1,372
Total
5,803 274 496 325 6,898
The Group’s exposure to credit risk arises from potential default of the counter party, with a maximum exposure equal to the carrying amount of these instruments.
Exposure at balance date is addressed in each applicable note. The carrying amount of financial assets represents the maximum credit exposure.
The Group trades only with recognised, creditworthy third parties and as such collateral is not requested nor is it the Group’s policy to securitize its trade and other
receivables.
The Group manages its exposure to key financial risks, including interest rate, liquidity risk and currency risk in accordance with the Group’s financial risk management
policy. The objective of the policy is to support the delivery of the Group’s financial targets whilst protecting future financial security.
The Board reviews and agrees policies for managing each of the risks identified below, foreign currency and interest rate risk, credit allowances, and future cash flow
forecast projections.
Liquidity risk is the risk of an unforeseen event or miscalculation in the required liquidity level that will result in the Group foregoing investment opportunities or not
being able to meet its obligations in a timely manner, and therefore gives rise to lower investment income or to higher borrowing costs than otherwise. Prudent
liquidity risk management includes maintaining sufficient cash, and ensuring the availability of adequate amounts of funding from credit facilities.
The table below analyses the Group's financial liabilities collated/grouped into relevant maturity bands, based on the remaining period from balance date to the
contractual maturity date.
It is the Group’s policy that all customers who wish to trade on credit terms are subject to credit verification procedures including an assessment of their independent
credit rating, financial position, past experience and industry reputation. Risk limits are set for each individual customer in accordance with parameters set by the
board. These risk limits are regularly monitored.
The Group’s exposure to market interest rates relates primarily to the Group’s cash deposited in interest-bearing call accounts, the bank overdraft and term loans.
Interest rates are monitored although there is generally no significant variation in interest rates offered by the different major banks.
At 30 June 2023, if interest rates had moved, as illustrated in the table below, with all other variables held constant, post-tax profit and equity would have been
affected as follows:
Management have reviewed the customer base for industry segments based on SIC codes and have evaluated the credit risk for each segment. There are no
significant concentrations of trade receivable counterparties.
Funds with financial institutions are held on call or short term deposits. The majority of funds are held across three major Australasian trading banks all with a
Standard and Poor's credit rating of AA-.
These financial statements should be read in conjunction with the Auditor's report.
39
Enprise Group Limited
Notes to the Consolidated Financial Statements
for the year ended 30 June 2023
26FINANCIAL RISK MANAGEMENT, OBJECTIVES AND POLICIES (CONTINUED)
(c)Liquidity risk (continued)
Contractual maturity analysisless than 6 mths6 - 12 months1 - 3 years> 3 yearsTotal
30 June 2022$'000$'000$'000$'000$'000
-
Trade and other payables2,963 -
- - 2,963
Bank overdraft330 -
- - 330
Term loan812 - - - 812
Lease liabilities356 206 540 557 1,659
Other borrowings- 41 - - 41
Total
4,461 247 540 557 5,805
(d)Financial instrument classification
30 June 202330 June 2022
$'000$'000
Financial asset at fair value through other comprehensive income452 627
Financial asset at fair value - 518
Amortised Cost
Cash and cash equivalents1,178 1,546
Trade receivables (excluding prepayments)3,575 3,018
Staff and related party receivables61 73
5,266 5,782
30 June 202330 June 2022
$'000$'000
Trade and other payables3,430 2,963
Borrowings2,096 1,183
5,526 4,146
(e)Foreign currency risk
Each entity in the Group conducts the majority of its transactions in its functional currency.
Australian dollarsProfitEquity
30 June 202330 June 202230 June 202330 June 2022
$'000$'000$'000$'000
+10% (1000 basis points)(148) (65) (42) 618
- 10% (1000 basis points)148 65 (42) (618)
At 30 June 2023, if currency rates had moved, as illustrated in the table below, with all other variables held constant, post-tax profit and equity would have been
affected as follows:
Financial assets
The currency exposure of the Group arises from the effect of any substantial movements in currency rates on the transfer of funds (predominantly in Australian
dollars) to the local currency of the subsidiary to fund operations. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and
adjusts their translation at the year-end for a 1 per cent change in foreign currency rates.
Financial liabilities at amortised cost
These financial statements should be read in conjunction with the Auditor's report.
40
Enprise Group Limited
Statutory Information
Directors
Lindsay Phillipsappointed 1 December 2013Non-Executive Director
Nicholas Paulappointed 1 December 2015Independent Non-Executive Chairperson
George Cooperappointed 10 April 2012Chief Executive Officer - Enprise Group
Ronald Baskindappointed 31 January 2018Chief Executive Officer - Kilimanjaro Division
Dr Aneesha Varghese-Cowanappointed 24 November 2022Independent Non-Executive Director
Marisa Fongresigned 24 November 2022Independent Non-Executive Director
Dr Aneesha Varghese-Cowan, Nicholas Paul and Elliot Cooper comprise the members of the Audit, Finance and Risk Committee.
30 June 202330 June 2022
Male Directors4
4
Female Directors1
1
Male Officers3
2
Female Officers-
1
Directors interests at 30 June 2023
Number of Shares
3,400,032
Ronald Baskind 2,938,403
George Cooper 243,242
Nicholas Paul 50,273
Dr Aneesha Varghese-Cowan -
The following entries are recorded in the period ending 30 June 2023:
Remuneration of directors
The remuneration of the Directors for the period ended 30 June 2023 is set out below:
30 June 202330 June 2022
$'000$'000
George Cooper
248 270
Lindsay Phillips
25 40
Nicholas Paul
35 98
Ronald Baskind
313 365
Dr Aneesha Varghese-Cowan
15 -
Marisa Fong
13 27
649 800
Total compensation of the directors is disclosed in note 21(f).
The following discloses the remuneration arrangements in place for chief executives for the period ended 30 June 2023:.
$'000$'000$'000$'000
Base per annumIncentiveSuperannuationTotal
George Cooper
230 20 8 258
Ronald Baskind
280 22 33 335
Incentives are discretionary and assessed by the Board based on the profitability of the company.
The Directors are pleased to submit to shareholders their report and financial statements for the year ended 30 June 2023. In order to comply with the Companies Act
1993, the directors report as follows:
Lindsay Phillips
• Lindsay Phillips ceased as a director of Control Bionics Pty Limited, Leed Group Holdings Limited, Old Bull and Box Holdings Pty Limited, Leed Manufacturing Pty
Limited and Larki Pty Limited. Lindsay Phillips was appointed as director of Fabulate Pty Limited and OK Group (APCA) Pty Limited.
Mr Paul is considered to be an independent director as he has a small holding in Enprise. Dr Varghese-Cowan is considered to be an independent director as she has no
shareholding in Enprise and has no other remuneration or influence which would affect her decision making in a material way.
• Dr Aneesha Varghese-Cowan is an shareholder and director of, Better World Australia Pty Limited, FACS Family Holdings Pty Limited, FACS Family Nominees Pty
Limited. She is a director of Aviation Aerospace Australia Limited and of Family Life Limited. Aneesha is a member of Victoria Advisory Panel for the Chartered
Accountants Australia and New Zealand. She is an shareholder in Sita Properties Limited.
41
Enprise Group Limited
Statutory Information
Employee remuneration
30 June 202330 June 2022
100,001 – 110,00014 8
110,001 – 120,0006 4
120,001 – 130,0007 10
130,001 – 140,0007 7
140,001 – 150,00011 4
150,001 – 160,0003 7
160,001 – 170,0006 7
170,001 – 180,00010 2
180,001 – 190,0002 1
190,001 – 200,0001 -
210,001 – 220,0001 3
220,001 – 230,0002 -
230,001 – 240,000- -
240,001 – 250,0001 1
250,001 – 260,0001 -
260,001 - 270,0001 1
270,001 - 280,000- 1
280,001 - 290,0001 1
300,001 - 310,0001 -
310,001 - 320,0001 -
340,001 - 350,000- 1
Twenty largest shareholders as at 8 August 2023
HoldingHolding %
New Zealand Central Securities Depository Ltd 3,587,287 20.58%
Nightingale Partners Pty Limited* 3,400,032 19.51%
Red Cow Investments Pty Limited~ 2,671,276 15.33%
Reitham Finanz Gmbh & Co Kg 861,471 4.94%
Dr Jens Neiser 681,159 3.91%
Custodial Services Limited 505,193 2.90%
New Zealand Depository Nominee 453,308 2.60%
Amely Zaininger 399,614 2.29%
Bernard Israel Fridman 318,145 1.83%
Carjon Investments Pty Limited 291,071 1.67%
Savgas Pty Limited 291,071 1.67%
Deansand Pty Limited 290,692 1.67%
Ronald Ivor Baskind 267,127 1.53%
Donwood Pty Limited 253,000 1.45%
Net Power Solutions Limited 249,893 1.43%
George Elliot Cooper 243,242 1.40%
Bernard Fridman 181,767 1.04%
Sarah May Loveys 141,052 0.81%
Jason Patrick Fegan 129,864 0.75%
Roger John Williams 124,686 0.72%
*Related parties to Lindsay Phillips
~Related party to Ronald Baskind
The number of employees or former employees, not being directors of the Group, that received remuneration and other benefits that exceeded $100,000 per annum is as
follows:
Number of employees
42
Enprise Group Limited
Statutory Information
Geographic distribution of shareholders as at 8 August 2023
CountryHoldersHolder %Issued capitalIssued capital %
New Zealand 261
65.58%
6,730,298
38.61%
Australia 107
26.88%
9,805,670
56.26%
Germany 17
4.27%
870,763
5.00%
USA 8
2.01%
16,263
0.09%
Great Britain 3
0.75%
6,667
0.04%
Philippines 1
0.25%
200
0.00%
Switzerland 1
0.25%
200
0.00%
Total 398 99.99% 17,430,061 100.00%
Distribution of shareholders as at 8 August 2023
RangeHoldersHolding quantityHolding %
1-1000 134 63,502
0.36%
1001-5000 150 378,642
2.17%
5001-10000 36 272,640
1.56%
10001-50000 56 1,226,088
7.03%
50001-100000 2 148,239
0.85%
Greater than 100000 20 15,340,950
88.03%
Total 398 17,430,061 100.00%
Substantial security holders
Holding
L Phillips 3,400,032
R Baskind 2,938,403
Dr J Neiser 3,000,630
Corporate governance
The directors have complied with the corporate governance code which can be found on the following link.
https://enprisegroup.com/s/201125-eg-corporate-governance-statement-4sx6.pdf
At 30 June 2023, the following security holders had given notices in accordance with the Financial Markets Conduct Act 2013 that they were a substantial product holder in
the Company. The number of shares shown below are as recorded for all the relevant interests recorded on the Company's share register.
43
Enprise Group Limited
Directory
Company Information
New Zealand company number1562383
ARBN (Australian Registered Body Number)125 825 792
ABN (Australian Business Number)41 125 825 792
Contact DetailsNew ZealandPrincipal place of business
Level 2, 16 Hugo Johnston DriveLevel 2, 16 Hugo Johnston Drive
Penrose, Auckland 1061Penrose, Auckland 1061
PO Box 62262Phone: +64 9 829 5500
Sylvia Park
Auckland 1644Registered office
Phone: +64 9 829 5500Level 2, 16 Hugo Johnston Drive
Fax: +64 9 829 5501Penrose, Auckland 1061
Australia Principal place of business – Australia
Level 4, 122 Walker StreetLevel 4, 122 Walker Street
North SydneyNorth Sydney, NSW 2060
NSW 2060
Phone: +61 2 8355 7055
Fax: +61 2 8355 7045
Websitewww.enprisegroup.com
Emailinfo@enprisegroup.com
Board of DirectorsNicholas Paul (Chair)
Dr Aneesha Varghese-Cowan
Lindsay Phillips
George Cooper
Ronald Baskind
Share RegisterLink Market Services Limited
Level 30, PwC Tower
15 Customs Street West
Auckland, New Zealand
Phone: +64 9 375 5990
AuditorUHY Haines Norton
Level 11
1 York Street
Sydney, NSW 2001
Phone : +61 2 9256 6600
LawyerHudson Gavin Martin, Auckland, New Zealand
Chapman Tripp, Auckland, New Zealand
Ash Street, Sydney, Australia
Principal BankersBNZ Bank Limited, Auckland, New Zealand
Enprise Group Limited shares are listed on the NZX. The
Group's share register is maintained by Link Market
Services Limited. Link is your first point of contact for any
queries regarding your investment in Enprise Group.
44
Level | 1 York Street | Sydney | NSW | 2000
GPO Box 4137 | S ydney | NSW | 2001
t: +61 2 9256 6600 | f: +61 2 9256 6611
sydney@uhyhnsyd.com.au
www.uhyhnsydney.com.au
An association of independent Ƃ rms in Australia and New Zealand and a member
of UHY International, a network of independent accounting and consulting Ƃ rms.
UHY Haines Norton—ABN 85 140 758 156 NSWBN 98 133 826
Liability limited by a scheme approved under Professional Standards Legislation.
Passion beyond numbers
9
Independent Auditor’s Report
To the Shareholders of Enprise Group Limited
Disclaimer of Opinion
I was engaged to audit the consolidated financial statements of Enprise Group Limited (“the
Company”) and its subsidiaries (“the Group”), which comprises:
• the consolidated statement of financial position as at 30 June 2023;
• the consolidated statement of comprehensive income, consolidated statement of changes in
equity and consolidated statement of cash flows for the year then ended; and
• the notes to the consolidated financial statements including a summary of significant
accounting policies.
I am a partner with UHY Haines Norton Chartered Accountants Sydney (the Firm) and I have used the
staff and resources of the Firm to perform the audit of the Group.
I do not express an opinion on the accompanying consolidated financial statements of the Group on
pages 6 to 40. Because of the significance of the matters described in the Basis for Disclaimer of
Opinion section of my report, I have not been able to obtain sufficient appropriate audit evidence to
provide a basis for an audit opinion on these financial statements.
Basis for Disclaimer of Opinion
Going Concern
Note 1(i) on pages 13 and 14 to the consolidated financial statements discloses conditions that
indicate the existence of material uncertainties relating to matters surrounding the continuing use of
the going concern assumption in the preparation of these financial statements.
Due to the significant level of uncertainty associated with forecasting the Group’s future cashflows
and in determining the likely outcome of the ongoing negotiations with the Bank Of New Zealand to
extend the existing debt facilities expiring at the end of October 2023, or to obtain suitable
replacement financing as detailed in note 1(i), I was unable to obtain sufficient appropriate audit
evidence to enable me to form an opinion as to whether the use of the going concern assumption is
appropriate. Consequently, I was unable to determine whether any adjustments were necessary in
respect of the consolidated statement of financial position of the Group as at 30 June 2023, the
consolidated statement of comprehensive income or consolidated statement of changes in equity.
I consider the impact of the above matters to be material and pervasive to the consolidated financial
statements of the Group.
Directors’ Responsibilities for the Consolidated Financial Statements
The Directors are responsible on behalf of the Group, for the preparation and fair presentation of the
consolidated financial statements in accordance with New Zealand equivalents to International
Financial Reporting Standards and International Financial Reporting Standards, and for such internal
control as the Directors determine is necessary to enable the preparation of consolidated financial
statements that are free from material misstatement, whether due to fraud or error.
An association of independent Ƃ rms in Australia and New Zealand and a member
of UHY International, a network of independent accounting and consulting Ƃ rms.
UHY Haines Norton—ABN 85 140 758 156 NSWBN 98 133 826
Liability limited by a scheme approved under Professional Standards Legislation.
Passion beyond numbers
In preparing the consolidated financial statements, the Directors are responsible on behalf of the
Group for assessing the Group’s ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless the Directors
either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do
so.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
My responsibility is to conduct an audit of the Group’s financial statements in accordance with
International Standards on Auditing (New Zealand) (“ISAs (NZ)”) issued by the New Zealand Auditing
and Assurance Standards Board and to issue an auditor’s report. However, because of the matters
described in the Basis for Disclaimer of Opinion section of my report, I was not able to obtain sufficient
appropriate audit evidence to provide a basis for an audit opinion on these financial statements.
I am independent of the Group in accordance with Professional and Ethical Standard 1 International
Code of Ethics for Assurance Practitioners (including International Independence Standards) (New
Zealand) issued by the New Zealand Auditing and Assurance Standards Board and the International
Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants
(including International Independence Standards) (IESBA Code), and I have fulfilled my other ethical
responsibilities in accordance with these requirements and the IESBA Code.
Other than in my capacity as auditor, neither myself, the firm or the firm’s staff have no relationship
with, or interests in, the Group.
Restriction on use of my report
This report is made solely to the Group’s shareholders, as a body. My audit work has been undertaken
so that I might state to the Group’s shareholders, as a body those matters which I am required to state
to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, I do
not accept or assume responsibility to anyone other than the Group and the Group’s shareholders, as
a body, for my audit work, for this report or for the opinion I have formed.
Vikas Gupta
Audit Partner - UHY Haines Norton Chartered Accountants Sydney
Signed at Sydney, Australia on 29 September 2023
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.
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