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CHOW GROUP LIMITED ANNUAL REPORT 2017 | PAGE 1

CHOW GROUP LIMITEDANNUAL REPORT

FOR THE YEAR ENDING 31 MARCH 2017

CHOW GROUP LIMITED ANNUAL REPORT 2O16


CONTENTS

Directors 2

Directors Report 4

Corporate Governance Statement 6

16 Park Ave 10

Park Ave Residence 12

Audit Report 14

Consolidated Financial Statements 18

Shareholder and Statutory Information 50

Corporate Information 61

| CHOW GROUP LIMITED ANNUAL REPORT 2017

DIRECTORS

JOHN CHOW B.Sc

John is an entrepreneur who has overcome enormous odds to become successful. It has been a testament to his hard work that he has moved from family owned Chinese takeaway bar owner to owner of $200m commercial property and business portfolio.

John’s transition from small business owner to becoming a corporate entity and rich-lister has taken effort, a clear understanding of where he wants to go and the fearlessness to move the goalposts in his favour.

Recently John has agreed with Pullman to operate the Rotorua Hotel owned by the Chows that will be opened late 2018 and is also keeping busy with Stonewood Homes and the Chows finance company, Inno Capital.

MICHAEL CHOW

One of Michael’s key strengths is Operations Management. Michael is the younger of the two Chow brothers who as an entrepreneur has overcome enormous odds to become successful.

His hard work has paid off - he has moved from family owned Chinese takeaway bar owner to owner of $200m commercial property and business portfolio.

Michael’s focus is on the Chow’s Wellington operations including CMC Hotel refurbishment, Exodus Gym, Capital Markets and Urban Hub that together with director roles with Inno Capital and Stonewood Homes keeps Michael busy.


BRENT KING B.Com, C.A., C.M.A., R.F.A. Brent King is an Auckland based Investment Banker who has over 30 years of experience in Public Markets, Finance and Investments. He has served on a number of public and private company Boards and also sits on the board of Mykco Limited. Mr King has also been a director of a number of public and private companies and a member of a number of voluntary organisations. Listed companies that Mr King has been a member of include: Dorchestor Pacific Limited, Finzsoft Solutions Limited, 42 Below Limited, Charlies Limited, Mykco Limited and AFC Group Limited. Mr King has advised on a number of high profile listings and capital raisings in New Zealand. He holds a degree from Canterbury University (B.Com) and is a Chartered Accountant (C.A.) and a registered financial adviser (R.F.A.).

CLINT WEBBER B.Com, L.L.B.

Clint has over 20 years of experience in the Banking and Finance industry including director roles at ANZ Banking Group and Lloyds Banking Group.

Prior to this Clint attended University in Australia, achieving degrees in Commerce and Law. Clint has been working with John and Michael Chow for the last 18 months making investments in finance and joint venture deals and more recently has been a founding Director and Partner in the Chows move into the finance industry, with the creation of Inno Capital.


BACKGROUND

This is the second Annual Report of the company known as Chow Group Ltd.

This Annual Report covers the first full year of trading since the shareholders of RIS Group Ltd voted to issue shares to buy all of the shares in 16 Park Avenue Ltd, a company that owns and operates 2 buildings as a short and medium term stay in Otahuhu, Auckland trading as “Park Avenue Residence” with the transaction being settled on 26th of February 2016

FINANCIAL PERFORMANCE

The Directors are very pleased with the financial performance of Chow Group Ltd for the period ending 31st March 2017. The accounts and associated notes are on pages 18 to 49.

Key Highlights are:

Profit Before Tax $1,652,127Total Comprehensive Income $1,468,295Total Assets $19,808,528Current Assets $3,239,049NTA per share (cents per share) 1.21

The Directors recommend that shareholders read the accounts and the notes in detail.

THANKS

The Directors of CGL wish to thank the Group’s management and employees for a successful years trading.

THE FUTURE OF CHOW GROUP LTD.

The Directors have focused on current operating activities at Park Avenue Residence and will ensure that shareholders are advised of future plans for the Group in a timely manner.

DIVIDEND POLICY

The current policy is to consider whether it is appropriate to pay a dividend on a semi-annual basis at the time of reporting the 6 monthly and Annual accounts.

The Directors have considered this for the current period and consider it is more appropriate to retain funds for future opportunities. This will be discussed at the Annual Meeting.

JOHN CHOW Chairman

DIRECTORS’ REPORT


The Board of Directors (“Board”) of Chow Group Limited (“the Group”) recognises the need for strong corporate governance and best practices. The Board have established policies and guidelines for good corporate governance and are guided by a charter that documents its intention and general approach to the fulfilment of its governance responsibilities. It incorporates Governance and Nominations Committee Charter, Audit Committee, Confirmation of Ethics Policy and Securities Trading Policy and Guidelines.

The Board believes that the corporate governance structures and practices encourage the creation of value and interest for Chow Group shareholders and other stakeholders whilst ensuring the highest standards of ethical conduct and providing accountability and control systems commensurate with the risks involved.

ROLE AND COMPOSITION OF THE BOARD

An experienced Board consisting of members with a wide range of business, technical and financial backgrounds lead and control the Group. The Board is responsible and accountable to shareholders and others stakeholders for the Group’ performance and its compliance with applicable laws and standards. This brings insightful depth and diversity to the acute leadership and management of an eminent and evolutionary business.

The NZAX Listing Rules requires a minimum of Three (3) Directors but for governance purposes the Group has chosen to have 4 Directors. The Board elects a Chairman whose primary responsibility is the efficient functioning of the Board.

The Board of Directors currently comprises two (2) Executive Directors (Ka Ming (Michael) Chow and Ka Yu (John) Chow). and two (2) Independent Non Executive Directors (Clinton Neil Webber and Brent Douglas King). The two (2) Independent Non Executive Directors do not participate in the day to day management of the Group and are not involved in business transactions or relationships with the Group, in order not to compromise their objectivity. In staying clear of any potential conflict of interest, the Independent Non Executive Directors remain in a position to fulfill their responsibility to provide check and balance to the Board.

The profiles of the Directors are presented on pages 2 and 3 of this Annual Report.

CORPORATE GOVERNANCE STATEMENT


CORPORATE GOVERNANCE STATEMENT (continued)

BOARD MEETINGS AND SUPPLY OF INFORMATION

The Board meetings are conducted in accordance with proper process. This enable the Board to peruse any board papers and review any issues to be deliberated at the Board meeting to enable Directors to make informed decisions.

A total of Board Meetings were held during the financial year under review and the Board attendance record is as follows:

Board Members Meetings Attended Meetings Held Year Ended 31 March 2017 Year Ended 31 March 2017 Ka Yu (John) Chow 8 8Ka Ming (Michael) Chow 8 8Clinton Neil Webber 8 8Brent Douglas King 8 8

The Board is provided at all times with accurate information on all aspects of Chow Group’ operations.

The Board is kept informed of key risks to Chow Group on a continuing basis. In addition, the Board meets whenever necessary to deal with specific matters needing attention between scheduled meetings.


AUDIT COMMITTEE

The Chow Group Audit Committee has been established to focus on audit and risk management and specifically addresses responsibilities relative to financial reporting and regulatory conformance.

The Audit Committee is accountable for ensuring the performance and independence of the external auditors and also makes recommendations to the Board.

The Audit Committee is comprises of the two (2) Non Executive Directors, both of whom are independent, and is currently chaired by Brent Douglas King.

OTHER COMMITTEES

Due to the importance of nomination and remuneration matters the Board as a whole addresses these and consequently there is no separate Nomination or Remuneration Committee.

ETHICAL CONDUCT

Chow Group has adopted a policy of business ethical conduct that is designed to formalise its commitment to high standards of ethical conduct and to provide all Directors and representatives with clear guidance on those standards. These are governed by its adopted charter on Confirmation of Ethics Policy and Securities Trading Policy and Guidelines that documents its intention and general approach to the fulfilment of its Directors and representatives’ responsibilities.



SHAREHOLDER INFORMATION

Dialogue with Investors

The Group recognises the importance of accountability to shareholders. Timely releases of the financial results, press releases and announcements provide an overview of the Group’s performance and operations to its shareholders.

The Annual Report of the Group is a key channel of communication with shareholders and investors, which highlights the business information and financial highlights of the Group, to facilitate shareholders’ easy access to such key information.

Apart from the mandatory announcements of the Group’s financial results and developments to New Zealand Alternative Exchange and Securities, Chow Group also maintains a website, www.chowgroup.co.nz for public access of the Group information, business activities and recent developments to all shareholders and other stakeholders, and for feedback.

ANNUAL GENERAL MEETING

The Annual Meeting remains the principal forum for dialogue with shareholders. At the Annual Meeting, the Board presents the progress and performance of the business and encourages shareholders to participate in the question and answer session. The Chairman and Directors will be in attendance to respond to shareholders’ queries during the meeting.



16 PARK AVE

BACKGROUND

931 sqm Land Area2,634 sqm Net Lettable Area

16 - 20 Park Avenue building is located to the Southern side of Park Avenue on the corner of Victoria Street, which is positioned to the South-Western fringe of the Otahuhu commercial center.

This five level commercial building was constructed around the 1970’s and included four levels of office space, a basement and an on-site car park. The building is subject to two telecommunication licenses to occupy the roof top space.

The office building has been converted to residential use and is occupied by Park Ave Residence which offers 90 rooms, complete with an en-suite and kitchenette.


The second of the two buildings 10 - 14 Park Avenue is Located to the southern side of Park Avenue and the corner of Queen Street.

857 sqm Land area1,004 sqm Net lettable area

This property comprises of a two level commercial building, also constructed around the 1970’s. As the second building to Park Avenue Residence this space offers 45 rooms with sharedfacilities.

There are a total of 135 rooms available for rental in the combined Park Ave Residence project.


Park Avenue Residence is the trading name for long and short term accommodation provided by 16 Park Avenue Ltd at the properties located 10-16 Park Avenue in Central Otahuhu.

Park Avenue Residence is an ideal option when considering affordable accommodation for business and leisure travelers a like. Conveniently situated close to major transport routes, a busy shopping district and supermarkets, but still surprisingly quiet makes Park Ave Residence a popular place to stay for a variety of people.

Park Ave specialise in offering an affordable, comfortable stay, with the privacy and convenience.

Staff are devoted to providing the highest possible standard of accommodation, with a committed live-in manager leading the way, available on site to provide assistance and advice. Park Ave Residence has a variety of rooms available:

• Studio Twin with Ensuite• Studio Room with Ensuite• Double Room with Shared Facilities• Twin Room with Shared Facilities

PARK AVE RESIDENCE

R E S I D E N C EPark Ave


CHOW GROUP LIMITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 MARCH 2017

The financial statements are to be read in conjunction with the notes to the financial statements set out on pages 22 to 49.

Chow Group LimitedConsolidated Statement of Comprehensive IncomeFor the year ended 31 March 2017

2017 2016Notes NZ$ NZ$

Operating ActivitiesRevenue 2 2,155,410 1,072,141

Direct operating expenses 3 (310,645) (170,968)Other operating expenses 3 (141,407) (77,749)Overheads and administration expenses 3 (783,029) (848,086)Total operating expenses (1,235,081) (1,096,803)

Other Income 9,526 10,557Subvention income 17 - 340,473Total other income 9,526 351,030

Operating Profit 929,855 326,368

Financing activitiesFinance income 4 128,152 131,563 Finance costs 4 (427,443) (184,432) 6.33%Net finance income/(costs) (299,291) (52,869)

464896.2789

Change in fair value of investment property 10 1,021,563 8,350,314 Loss on acquisition 26 - (403,016)

1,021,563 7,947,298

Profit before income tax 1,652,127 8,220,797

Income tax expense 5 183,832 169,029

1,468,295 8,051,768

Other comprehensive income - -

1,468,295 8,051,768

Profit per share:Basic profit per share (cents per share) 20 0.18 6.03 Diluted Profit per share (cents per share) 20 0.18 6.03

Total comprehensive income for the year

Net profit for the year

The financial statement are to be read in conjunction with the notes to the financial statements set out on pages 5 - 32

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CHOW GROUP LIMITED CONSOLIDATED STATEMENT CHANGES IN EQUITYFOR THE YEAR ENDED 31 MARCH 2017


Chow Group LimitedConsolidated Statement of Changes in Equity For the year ended 31 March 2017

Share Retained Total Capital Earnings Equity

Notes NZ$ NZ$ NZ$

Balance at 31 March 2015 - (45,115) (45,115)

Net profit for the year - 8,051,768 8,051,768

Transactions with ownersEquity contributed 14 497,205 - 497,205

Balance at 31 March 2016 497,205 8,006,653 8,503,858

Net profit for the year - 1,468,295 1,468,295

Balance at 31 March 2017 497,205 9,474,948 9,972,153


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CHOW GROUP LIMITED CONSOLIDATED STATEMENT OF FINANCIAL POSITIONFOR THE YEAR ENDED 31 MARCH 2O17

Chow Group LimitedConsolidated Statement of Financial Position As at 31 March 2017


SHAREHOLDERS EQUITYContributed capital 14 497,205 497,205Retained earnings 15 9,474,948 8,006,653

Total shareholders funds 9,972,153 8,503,858

Represented by:

CURRENT ASSETSCash and cash equivalents 6 945,966 876,449Trade and other receivables 8 16,546 73,137Related party receivables 7 2,087,843 1,973,248Prepayments 27,144 66,456Available-for-sale financial assets 9 161,550 161,550

Total current assets 3,239,049 3,150,840

NON-CURRENT ASSETSProperty plant and Equipment 19,479 - Investment property 10 16,550,000 15,510,000

Total non-current assets 16,569,479 15,510,000

Total assets 19,808,528 18,660,840

CURRENT LIABILITIESTrade creditors and other payables 11 299,922 444,049Related party payables 12 2,402,988 2,311,193Loans and borrowings 13 404,666 448,000Income tax payable 5 100,720 33,052

Total current liabilities 3,208,296 3,236,294

NON-CURRENT LIABILITIESLoans and borrowings 13 6,491,668 6,896,333Deferred tax 5 136,411 24,355

Total non-current liabilities 6,628,079 6,920,688

Total liabilities 9,836,375 10,156,982

Net assets 9,972,153 8,503,858

For and on behalf of the Board

John Chow - Chairman Brent King - Director

Date: Date:


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CHOW GROUP LIMITED CONSOLIDATED STATEMENT OF CASH FLOWSFOR THE YEAR ENDED 31 MARCH 2O17

Chow Group LimitedConsolidated Statement of Cash Flows For the year ended 31 March 2017


Cash flows from operating activitiesReceipts from customers 2,199,571 1,070,978Interest received 26,053 5,173Dividends received 9,526 1,090Net GST received 31,061 67,951Payments to suppliers and employees (1,203,660) (406,471)Interest paid (323,388) (205,583)Income tax paid (4,108) (1,654)

Net cash inflow from operating activities 16 735,055 531,484

Cash flows from investing activitiesPurchase of property, plant and equipment (24,346) -Payments for construction work in progress - (2,160,445)

10 (18,437) - (42,783) (2,160,445)

Cash flows from financing activitiesProceeds from borrowings - 7,325,000Repayment of borrowings 13 (447,999) (37,333)Repayment of borrowings from related parties (174,756) (3,368,218)Loans to related parties - (1,497,891)

Net cash inflow/(outflow) from financing activities (622,755) 2,421,558

Net increase in cash and cash equivalents 69,517 792,597

876,449 2,177

26 - 81,675

6 945,966 876,449


Cash and cash equivalents at the end of the year

Cash and cash equivalents at the beginning of the year

Net cash outflow from investing activities

Cash and cash equivalents acquired on purchase of subsidiary

Payment for additions in relation to investment property

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CHOW GROUP LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2017

Chow Group LimitedNotes to the Consolidated Financial StatementsFor the year ended 31 March 20171. SIGNIFICANT ACCOUNTING POLICIES

REPORTING ENTITY

1.1 Statement of compliance

1.2 Basis of preparation

1.3 New accounting standards adopted

The financial statements are presented in New Zealand dollars (NZD), which is the Group’s functional and presentation currency.

A number of new standards, amendments to standards and interpretations have been issued but are not yet effective and have not been early adopted by the Group for the year ended 31 March 2017. None of the significant standards would have a material impact on the reported financial performance of the Group.

The reporting entity is Chow Group Limited and it's subsidiary (the Group), which is a for- profit entity incorporated and domiciled in New Zealand and registered under the Companies Act 1993. The Company is listed on the Alternative Market of the New Zealand Stock Exchange (“NZAX”) and the addresses of its registered office and principal place of business are disclosed in the directory to the annual report. The Company is a FMC reporting entity for the purposes of the Financial Markets Conduct Act 2013 and its financial statements comply with the Companies Act 2013 and the Financial Markets Conduct Act 2013.

The consolidated financial statements of Chow Group Limited as at and for the year ended 31 March 2017 comprise the Company and its legal subsidiary. The Group is also a for profit entity. The principal activity of the Group was providing accommodation in an investment property developed to provide those services.

These financial statements have been prepared in accordance with Generally Accepted Accounting Practice in New Zealand ('NZ GAAP'). They comply with New Zealand Equivalents to International Financial Reporting Standards ('NZ IFRS') and other applicable Financial Reporting Standards, as appropriate for profit oriented entities. These financial statements also comply with International Financial Reporting Standards ('IFRS').

The financial statements were approved by the directors on the date stated at page 3.

The financial report has been prepared under the historical cost convention, as modified by revaluations for certain classes of assets and liabilities to fair value and related assets to net present value as described in the accounting policies below.

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CHOW GROUP LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 31 MARCH 2017Chow Group LimitedNotes to the Consolidated Financial StatementsFor the year ended 31 March 20171. SIGNIFICANT ACCOUNTING POLICIES (continued)

1.4 New accounting standards and interpretations not yet adopted

NZ IFRS 16 'Leases' (effective for the period beginning on or after 1 January 2019)

Management has initiated a plan to assess the broader issues of adopting NZIFRS 15. This plan has yet to be completed and as such the impact of adopting NZIFRS 15 has yet to be quantified. Management expect to complete this plan in the forthcoming months.

NZ IFRS 16: Leases replaces the current guidance in NZ IAS 17 Leases. The existing lease accounting rules require lessees and lessors to classify their leases as either finance or operating leases. A lessee is not required to recognise lease assets or liabilities for operating leases.

Under NZ IFRS 16, there are some minor changes to the accounting treatment for lessors, and significantly more disclosure would be required. The Group currently does not have any leases that will be affected by this standard but intends to adopt NZ IFRS 16 effective from 1 April 2019 for any relevant leases.

The following new standards, amendments and interpretations are issued but not yet effective for the Group’s accounting periods beginning on or after 1 April 2016. The Group has not early adopted them.

NZ IFRS 9, ‘Financial instruments’, addresses the classification, measurement and recognition of financial assets and financial liabilities. NZ IFRS 9 was issued in November 2009 and October 2010. It replaces the parts of NZ IAS 39 that relate to the classification and measurement of financial instruments. NZ IFRS 9 requires financial assets to be classified into two measurement categories: those measured as at fair value and those measured at amortised cost. The determination is made at initial recognition. The classification depends on the entity’s business model for managing its financial instruments and the contractual cash flow characteristics of the instrument. For financial liabilities, the standard retains most of the NZ IAS 39 requirements. The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change due to an entity’s own credit risk is recorded in other comprehensive income rather than the income statement, unless this creates an accounting mismatch.

NZ IFRS 15 ‘Revenue from Contracts with Customers’ provides a five-step model to be applied to the recognition of revenue arising from contracts with customers: • identify the contract with the customer; • identify the performance obligations in the contract; • determine the transaction price; • allocate the transaction price to the performance obligations in the contract; and • recognise revenue when (or as) the entity satisfies a performance obligation. NZ IFRS 15 also introduces new disclosures about revenue.

NZ IFRS 9 ‘Financial Instruments’ (effective for the period beginning on or after 1 January 2018)

NZ IFRS 15 ‘Revenue from Contracts with Customers’ (effective for the period beginning on or after 1 January 2018)

Management has initiated a plan to assess the broader issues of adopting NZIFRS 9. This plan has yet to be completed and as such the impact of adopting NZIFRS 9 has yet to be quantified. Management expect to complete this plan in the forthcoming months.

NZ IFRS 16 will require a lessee to recognise a lease liability reflecting future lease payments and a “right-of-use” for most lease contracts.

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1.5 Basis of consolidation

1.6 Cash and cash equivalents

1.7 Employee benefits

1.8 Investment Property

Investment property is held to earn rental income and for capital appreciation. Investment property is measured at cost on initial recognition. Cost includes expenditure that is directly attributable to the acquisition and construction of the asset. Work in progress on the investment property is carried at fair value. Work in progress relates to the cost of constructing a building on the investment properties to be used to earn rental income on provision of temporary accommodation.

Subsequent to the initial recognition and once the asset is ready for use, the investment property is measured at fair value with any change therein recognised in profit or loss.

Fair value is determined annually by independent registered valuers with sufficient experience with respect to both the location and the nature of investment property. In deriving a fair value all assumptions are based, where possible, on market based evidence and transactions for properties with similar locations, construction detail and accomodation profile. The adopted market value is based on the Capitalisation approach.

The Group financial statements consolidate the financial statements of the Parent and all entities over which the Parent is deemed to have controlling relationship (defined as "subsidiaries"). An entity is defined as a subsidiary when the Group is exposed, or has rights, to variable returns from its relationship with the entity and has the ability to affect those returns through its power over the entity.

When the Group has less than a majority of the voting power or similar rights of another entity, the Group considers all relevant facts and circumstances in assessing whether it has power over the other entity.

The Group re-assesses whether or not it controls another entity if facts and circumstances indicate that there are changes in one or more of the three elements of control. The financial statements of the subsidiary are included in the consolidated financial statements from the date that control commences until the date that control ceases.

Cash and cash equivalents comprise cash on hand, and cash in banks net of outstanding bank overdrafts.

Provision is made for benefits accruing to employees in respect of wages and salaries, annual leave, and sick leave when it is probable that settlement will be required and they are capable of being measured reliably.

Provisions made in respect of employee benefits expected to be wholly settled within twelve months, are measured at their nominal values using the remuneration rate expected to apply at the time of settlement.

The consolidation of the Parent and the subsidiary involves adding together like terms of assets, liabilities, income and expenses on a line-by-line basis. All significant intra-group balances are eliminated on consolidation of Group financial position, performance and cash flows.

The subsidiary has a 31 March balance date and consistent accounting policies are applied.

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1.8 Investment Property (continued)

1.9 Financial assets

Available-for-sale financial assets

Loans and other receivables

1.10 Financial instruments issued by the Group

Debt and equity instruments

Other financial liabilities

Debt and equity instruments are classified as either liabilities or as equity in accordance with the substance of the contractual arrangement. The value of ordinary shares is determined at the time the share is issued and is included in equity net of issue costs.

Investment properties are derecognised when they have been disposed of. On the derecognition of an investment property, the difference between the net disposal proceeds and the carrying amount is recognised in profit or loss.

When the use of investment property changes such that it is reclassified as property, plant and equipment, its fair value at the date of reclassification becomes its cost for subsequent accounting periods.

Certain investments held by the Group are classified as being available-for-sale and are stated at fair value. Fair value is determined in the manner described in note 9.

Gains and losses arising from changes in fair value are recognised directly in the available-for-sale revaluation reserve with the exception of impairment losses, foreign exchange gains and losses on monetary assets, which are recognised directly in profit or loss. Where the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously recognised in the available-for-sale revaluation reserve is reclassified to profit or loss for the period.

Trade receivables, loans, and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as ‘loans and receivables’. Loans and receivables are measured at amortised cost using the effective interest method less impairment. The average credit period for trade receivables is 30 days. Interest is not charged on overdue amounts.

Other financial assets are classified into the following specified categories: financial assets ‘at fair value through profit or loss’, ‘held-to-maturity investments’, ‘available-for-sale’ financial assets, and ‘receivables’. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.

Investments are recognised on trade date where the purchase of an investment is under a contract whose terms require delivery of the investment within the timeframe established by the market concerned, and are initially measured at fair value, plus transaction costs except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value.

Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs and are subsequently measured at amortised cost using the effective interest method.

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1.11 Equity

Transaction costs on the issue of equity instruments

1.12 Goods and Services Tax (“GST”)

1.13 Income tax

Deferred tax

1.14 Payables and provisions

Transaction costs arising on the issue of equity instruments are recognised directly in equity as a reduction of the proceeds of the equity instruments to which the costs relate. Transactions costs are the costs that are incurred directly in connection with the issue of those equity instruments and which would not have been incurred had those instruments not been issued.

Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except for receivables and payables, which are recognised inclusive of GST.

Current tax is calculated with reference to the amount of income taxes payable or recoverable in respect of the taxable profit or tax loss for the period. It is calculated using tax rates and tax laws that have been enacted or substantively enacted by the reporting date. Current tax for current and prior periods is recognised as a liability (or asset) to the extent that it is unpaid (or refundable).

Deferred tax is accounted for using the comprehensive liability method in respect of temporary differences arising from differences between the carrying values of assets and liabilities in the financial statements and the corresponding tax base of these items.

Current and deferred tax is recognised as an expense or income in profit or loss, except when it relates to items credited or debited directly to other comprehensive income or equity, in which case the deferred tax or current tax is also recognised directly in other comprehensive income, or where it arises from the initial accounting for a business combination, in which case it is taken into account in the determination of goodwill. Deferred tax liabilities are recognised for all taxable temporary differences.

Deferred tax assets arising from deductible temporary differences are only recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits of the temporary differences and they are expected to reverse in the foreseeable future. The carrying amount of deferred tax assets is reviewed at the end of each reporting period 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.

Trade and other payables are carried at amortised cost. They represent liabilities for goods and services provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make future payments in respect of the purchase of these goods and services. The amounts are unsecured and are normally paid within 30 days of recognition.

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

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1.15 Revenue recognition

The following specific recognition criteria must be met before revenue is recognised:

Rental and accommodation income

Interest incomeInterest income is recognised as it accrues, using the effective interest method.

Dividend incomeDividend income is recognised on the date that the Group's rights to receive payments are established.

1.16 Borrowings

1.17 Impairment of assets

Rental and accommodation income arising, from rental premises and provision of temporary accommodation, is accounted for on a straight-line basis over the lease term.

At each reporting date the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such impairment exists, the recoverable amount of the asset is estimated to establish the impairment loss, (if any).

The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of loan and trade receivables where the carrying amount is reduced through the use of an allowance account.

When a trade receivable is uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or loss.

With the exception of available-for-sale equity instruments, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised.

Financial assets are assessed for indicators of impairment at each balance date. Financial assets are impaired where there is objective evidence that as a result of one or more events that occurred after the initial recognition of the financial asset the estimated future cash flows of the investment have been impacted. For financial assets carried at amortised cost, the amount of the impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate.

Revenue is recognised to the extent that it is probable that the economic benefit will flow to the Group and revenue can be reliably measured. Revenue is measured at the fair value of consideration received, excluding GST.

Borrowings are recorded initially at fair value, net of transaction costs and thereafter using the effective interest rate method. Interest costs attributable to the borrowings are accrued on a time basis using the effective interest rate method and are recorded in profit or loss.

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CHOW GROUP LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 31 MARCH 2017Chow Group LimitedNotes to the Consolidated Financial StatementsFor the year ended 31 March 2017

1. SIGNIFICANT ACCOUNTING POLICIES (continued)

1.17 Impairment of assets (continued)

All impairment losses are immediately recognised through profit and loss.

1.18 Segment reporting

1.19 Earnings per share

1.20 Critical accounting judgments and key sources of estimation uncertainty

Classification of Property

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying value is reduced to the recoverable amount. An impairment loss is recognised in profit or loss immediately, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Operating segments are identified on the basis of internal reports about components of the Group that are regularly reviewed by the Chief operating decision makers in order to allocate resources to the segment and assess its performance.

The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Group by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares outstanding during the period.

In the application of NZ IFRS, the Board and management are required to make judgements, estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on experience and other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements. Actual results may differ from the estimates, judgements and assumptions made by the Board and management.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected.

Judgements made by management in the application of NZ IFRS that have significant effects on the financial statements and estimates with a significant risk of material adjustments in the next year are disclosed, where applicable, in the relevant notes to the financial statements.

In particular, information about significant areas of estimation uncertainty that have the most significant effect on the amount recognised in the financial statements is disclosed in the relevant notes as follows:• Investment properties (note 10)• Deferred tax (note 5)

The Directors have applied their judgement in assessing the classification of property owned by the Group. The Directors consider that all property owned by the Group should be classified as an investment property as ancillary services provided to occupants of these properties are insignificant and the properties are not owner occupied.

11



1.20 Critical accounting judgments and key sources of estimation uncertainty (continued)

Revaluation of investment properties

Impairment

Deferred Tax

The Group has recognised its investment properties at fair value as at 31 March 2017. Investment properties have been valued by reference to market-based evidence, using a net market capitalisation rate which reflects both the quantum value of the property, its modern fitout and its performance since opening in late 2015. The Group has used an external independent valuer, having appropriate recognised professional qualifications and experience to assess the fair value of the investment properties as at 31 March 2017.

The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax assets are recognised only to the extent that it is probable that future taxable profits will be available against which the assets can be utilised.

An impairment loss is recognised for the amount by which the asset's or cash-generating unit's carrying amount exceeds its recoverable amount. To determine the recoverable amount, management estimates expected future cash flows from each asset or cash-generating unit and determines a suitable interest rate in order to calculate the present value of those cash flows. In the process of measuring expected future cash flows management makes assumptions about future operating results. These assumptions relate to future events and circumstances.

Management have reviewed the carrying values of the investment properties, receivables and an impairment loss has been recognised against trade and other receivables (note 8).

12


CHOW GROUP LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 31 MARCH 2017

Chow Group LimitedNotes to the Consolidated Financial StatementsFor the year ended 31 March 20172. REVENUE

2017 2016NZ$ NZ$

Accommodation income 2,143,002 1,043,974Rental income 12,408 28,167

2,155,410 1,072,141

3. EXPENSES2017 2016NZ$ NZ$

Bad debts 21,170 -Wages, salaries and other staff costs 289,475 170,968Direct Operating costs 310,645 170,968

Management fees paid to related parties (refer note 17) 150,000 64,750Rates 54,174 25,652Repairs and maintenance 30,432 34,952Takeover costs - 495,200

689,830 305,281924,436 925,835

Fees charged by Audit Firm:Financial statement audit

Current year audit fee 55,000 40,000Under provision from prior year 34,000 -

89,000 40,000

4.2017 2016NZ$ NZ$

14,257 5,173113,895 126,390128,152 131,563

300,844 167,593126,599 16,839

427,443 184,432

(299,291) (52,869)

No other services, assurance or otherwise, have been provided to the Group by Staples Rodway Auckland.

FINANCE INCOME AND COSTS

Financing incomeInterest income - other sourcesInterest income - related party (refer note 17)Total finance income

Financing expenditureInterest expenseInterest expense - related party (refer note 17)

Total interest expense on borrowings

Net finance income/(costs)

The following costs were expensed in the operating profit for the year:

Other operating expenses, overheads and administrative expensesOther operating expenses, overheads and administrative expenses

13



5. INCOME TAX

2017 2016

NZ$ NZ$5.1 Components of income tax expense

Current year tax expense 73,803 36,927

Under / Over provision (2,028) -

Deferred tax movements

- tax losses 16,034 80,555

- timing differences 96,023 51,547

Income tax expenses 183,832 169,029

5.2 Reconciliation of effective tax rate

Profit current year 1,652,127 8,220,797

Income tax using Corporate tax rate @ 28% (2016: 28%) 462,596 2,301,823

Expected income tax expense 462,596 2,301,823

Adjustments:

Non deductible / non-assessable transactions (276,736) (2,132,370)

Under / Over provision (2,028) -

Imputation Credits converted to a loss - (424)

Current year income tax expense 183,832 169,029

5.3 Income tax payable/ (receivable)

Opening balance 33,052 (74)

Balance acquired on acquisition - (2,150)

Current year tax expense 73,803 36,927

Provisional tax and RWT paid (6,135) (1,651)

Closing balance 100,720 33,052

5.4 Imputation credits

Opening balance 2,561 486

RWT paid 6,135 1,651

Imputation Credits converted to a loss - 424

Closing balance 8,696 2,561

14



5. INCOME TAX (continued)

2017 2016

NZ$ NZ$5.5 Deferred tax assets and liabilities

Deferred tax on unused tax losses

Opening balance 16,033 96,588

Tax losses recognised in the year - 16,033

Tax losses utilised in the year (16,033) (96,588)

Closing asset balance - 16,033

Opening balance (40,388) (1,266)

Balance acquired on acquisition - 12,425

Timing difference movements (96,023) (51,547)

Closing liability balance (136,411) (40,388)

Closing deferred tax asset / (liability) (136,411) (24,355)

Deferred tax assets and liabilities are attributable to the following.

2017 2016 2017 2016

NZ$ NZ$ NZ$ NZ$

Property, plant and equipment - - (151,122) (59,959)

Employee benefits 2,062 2,417 - -

Accruals 6,721 17,154 - -

Provision for bad debts 5,928 - - -- 16,033 - -

14,711 35,604 (151,122) (59,959)

2017 2016

NZ$ NZ$

Net deferred tax asset / (liability) (136,411) (24,355)

6. CASH AND CASH EQUIVALENTS2017 2016

NZ$ NZ$

Cash at bank and on hand 930,966 861,449

Restricted cash 15,000 15,000

Total cash and cash equivalents 945,966 876,449

The restricted cash is a bank deposit to provide security for a bond in favour of NZX Ltd, that is provided under the NZAX Listing rules.

Deferred tax on temporary differences - depreciation and provisions

The carrying amount of cash and cash equivalents approximates their fair value. Cash at bank earns interest at floating rates on daily deposit balances.

Assets Liabilities

Tax losses recognised in the year

15



Chow Group LimitedNotes to the Consolidated Financial StatementsFor the year ended 31 March 2017

7. RELATED PARTY RECEIVABLES2017 2016

NZ$ NZ$

Related party receivables (refer note 17) 2,087,843 1,973,248

8. TRADE AND OTHER RECEIVABLES2017 2016

NZ$ NZ$

Trade debtors 37,716 10,632

GST receivable - 62,505

Less allowance for impairment (21,170) -

Total Trade and other receivables 16,546 73,137

Impairment allowance 2017 2016The movement in the allowance for doubtful debts is as follows: NZ$ NZ$

Opening balance - -Amounts written off - -Impairment losses recognised in the year (21,170) -Impairment losses reversed in the year - -Closing balance (21,170) -

9. AVAILABLE-FOR-SALE FINANCIAL ASSETS2017 2016

NZ$ NZ$

Investment in listed company

Fair value on acquisition 161,550 161,550

Impairment of the available-for-sale asset - -

161,550 161,550

ComprisingCurrent 161,550 161,550

Non-current - -161,550 161,550

Related party receivables earn interest at rates disclosed in note 17 to the financial statements and are unsecured and repayable on demand.

Trade debtors and other receivables are non-interest bearing and receipt is normally on 30 days terms. The directors consider that there is no material difference between the carrying value and fair value of trade debtors and other receivables.

The Group's management considers that all financial assets that are not impaired or past due for each of the reporting dates under review are of good credit quality.

The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and other receivables. The main component of this allowance is a specific loss component that relates to individually significant exposures.

16



9. AVAILABLE-FOR-SALE FINANCIAL ASSETS (continued)

Investment in USG Tech Solutions Limited

Measurement of fair value

Valuation techniques used to derive level 3 fair values

Information about fair value measurements using significant inputs

2017 Valuation technique

Growth rate (0%)

ImpairmentThe Chow Group completes an assessment of the carrying value of investments at least annually and considers objective evidence for impairment on each investment, taking into account observable data on the investment, the status or context of markets, its own view of fair value, and its long term investment intentions. The Chow Group notes the following matters which are specifically considered in terms of objective evidence of impairment of its investments, and whether there is a significant or prolonged decline from cost, which should be recorded as an impairment, and taken to profit and loss: any known loss events that have occurred since the initial recognition date of the investments, including its investment performance, its long term investment horizon, specific initiatives which reflect the strategic or influential nature of its existing investment position and internal valuations; and the state of markets. The assessment also requires judgements about the expected future performance and cash flows of the investment.

The Group holds 3,463,410 ordinary shares in USG Tech Solutions Limited ("USG"). USG is listed on the Bombay Stock Exchange (BSE Scrip Code: 532402). The equity securities are denominated in Indian Rupees. The Group intends to realise its investment in USG.

The Chow Group have accounted for the 8.79% minority shareholding in USG Tech Solutions Limited as an available-for-sale investment whose fair value is $161,550, which was determined using a discounted cash flow model. The Board consider that the calculation of the fair value of USG Tech Solutions Limited includes inputs that are not based on observable data.

The Board considers that the fair value of the investment has been calculated with reference to Level 3 inputs. The key factors and assumptions used in determining the fair value were:

Significant unobservable inputs Relationship of unobservable inputs to fair valueThe estimated fair value would increase/ (decrease) if:

Net recoverable asset on liquidation basis $439,493 (8.79% of investment)

Net recoverable asset was higher/(lower);

USG Tech Solutions Limited

- The investment is listed on the Bombay Stock Exchange, however the share price is not reflective of fair value as the shares are not actively traded. - The methodology adopted is to assess the fair value of net recoverable assets on a liquidation basis assuming a realisation at a discount rate of 25%

Fair Value on Net Recoverable Assets on Liquidation basis

Discount rate (25%) The Discount rate was higher/(lower);

Growth rate was higher/(lower)

17



10. INVESTMENT PROPERTY2017 2016

NZ$ NZ$

Opening balance 15,510,000 4,655,09218,437 2,310,399

Additions : Borrowing costs capitalised (refer note 17) - 194,195

Change in fair value for the year 1,021,563 8,350,314

Closing balance 16,550,000 15,510,000

Consists of:

Land and Buildings at fair value 16,550,000 15,510,000

Closing balance 16,550,000 15,510,000

Reconciliation of net profit generated from investment property:2,155,410 1,072,141

Direct operating expenses (including repairs and maintenance) (280,213) (205,920)

Change in fair value of investment property 1,021,563 8,350,314

Net profit arising from investment properties 2,896,760 9,216,535

Measurement of fair value - Investment property

· Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Rental/Accommodation income derived from investment properties

The fair value of investment properties have been recognised in the financial statements as at 31 March 2017 with reference to valuations completed by an independent valuer. The valuation has been completed in accordance with the International Valuation Standards, in particular IVS 300 - Valuations for Financial Reporting and NZIFRS 13 - Fair Value Measurement.

In determining fair value, a single year net operating income applicable to each investment property has been divided by the net market capitalisation rate. The capitalisation rate reflects both the quantum value of the property, its modern fitout and its performance since opening in 2015.

The table below analyses the non-financial assets carried at fair value, by a valuation method. The different levels have been defined as follows:

· Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Investment property comprises property in Auckland, which is held to earn rents and for capital appreciation purposes.

As disclosed in note 13 bank loans and borrowings are secured over the investment property and therefore the Group is restricted in its ability to realise its investment property. Commitments to purchase, construct or develop investment property or for repairs, maintenance and enhancements are disclosed at note 23 to the financial statements.

Additions : Completed developments transferred from Work in progress

· Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

18



10. INVESTMENT PROPERTY (Continued)

Measurement of fair value - Investment property

The investment properties of the Group have been valued by the following independent valuer:

Property Valuer 2017 Effective date Fair value level

10 - 14 Park Avenue Anthony Long, Colliers March 2017 3

16 - 20 Park Avenue Anthony Long, Colliers March 2017 3

The following table analyses the investment property carried at fair value, by valuation method2017 2016

NZ$ NZ$

10 - 14 Park Avenue 5,400,000 5,010,000

16 - 20 Park Avenue 11,150,000 10,500,000

Total carrying amounts 16,550,000 15,510,000

Valuation techniques used to derive level 3 fair values

Information about fair value measurements using significant inputs

2017 Valuation technique

10 - 14 Park Avenue Capitalisation of Net Income

16 - 20 Park Avenue Capitalisation of Net Income

Significant unobservable inputs Relationship of unobservable inputs to fair valueThe estimated fair value would increase/ (decrease) if:

Average Room Rate ($260/week)Other Income ($15/week) Carparks ($15/week)Net Income ($418,946 per annum)

Average Room Rate ($300/week)Other Income ($15/week) Carparks ($15/week)Net Income ($860,651 per annum)

Average room rate, other income, carparks, net income and growth was higher/ (lower);

Expected market rental growth (0%)

Net market capitalisation rate (7.75%)

Expected market rental growth was higher/ (lower);The occupancy rate were higher/ (lower);Net market capitalisation rate were lower/ (higher)

Expected market rental growth (0%)

Occupancy rate (95%)

Net market capitalisation rate (7.75%)

Expected market rental growth was higher/ (lower);

The occupancy rate were higher/ (lower);

Net market capitalisation rate were lower/ (higher)

Occupancy rate (90%)

Average room rate, other income, carparks, net income and growth was higher/ (lower);

Fair value is determined annually by independent registered valuers with sufficient experience with respect to both the location and the nature of investment property. In deriving a fair value all assumptions are based, where possible, on market based evidence and transactions for properties with similar locations, construction detail and accomodation profile. The adopted market value was computed using the Capitalisation approaches.

In the absence of current prices in an active market, the valuations are prepared based on a capitalisation of net income approach. A market yield is applied to the estimated net income to arrive at the gross property valuation.

19



10. INVESTMENT PROPERTY (continued)

Increase in Input

Decrease in Input

Valuation method

Decrease Increase Capitalisation

Increase Decrease Capitalisation

Minimum lease income

2017 2016

NZ$ NZ$Future minimum lease income are as follows:

Less than one year 13,400 25,307Between one and five years 38,988 69,286

52,388 94,593

11. TRADE CREDITORS AND OTHER PAYABLES2017 2016

NZ$ NZ$

Trade creditors 66,435 110,220

GST Payable 40,084 46,343

Unearned Income 72,506 23,202

Other creditors and accrued expenses 120,897 264,284

Total trade creditors and other payables 299,922 444,049

During the year ended 31 March 2017, the properties generated operating lease income through the lease of space to communications providers. The future minimum lease income under these operating leases is noted in the table below

Trade creditors and accrued expenses are non-interest bearing and normally settled on 30 day terms. The directors consider that there is no material difference between the carrying value and fair value of trade creditors and other payables.

The valuer’s assessment of net market income for both room rental rates and spaces of the investment property.

The key inputs used to measure fair value of investment properties, along with their sensitivity to significant increase or decrease, are stated below:

Significant Input

Fair Value measurement sensitivity to significant

Description

Market capitalisation rate

Market rental

The capitalisation rate is applied to the market income to assess an investment property’s value. The capitalisation rate is derived from detailed analysis of factors such as comparable sales evidence and leasing transactions in the open market taking into account location, Room and Occupancy rates, market rentals, size and quality of the investment property.

20



12. RELATED PARTY PAYABLES2017 2016

NZ$ NZ$

Related party trade payables (refer note 17) 748,019 734,673

Related party loans (refer note 17) 1,654,969 1,576,5202,402,988 2,311,193

13. LOANS AND BORROWINGS2017 2016

NZ$ NZ$

Current

Secured bank loan 400,000 400,000

Unsecured term debt 4,666 48,000

Total current loans and borrowing 404,666 448,000

Non-current

Secured bank loan 6,491,668 6,891,667

Unsecured term debt - 4,666

Total non-current loans and borrowings 6,491,668 6,896,333

Total loans and borrowings 6,896,334 7,344,333

Terms and debt repayment schedule Repayment

termsInterest rate Year of maturity Balance

$400,000 per annum with remaining balance on maturity

4.04% 31 October 2018 6,891,668

$4,000 per month

NIL 30 April 2017 4,666

Total 6,896,334

The carrying amount of loans and borrowings are denominated in New Zealand Dollars.

Interest rate repricing - ANZ Bank Limited - Secured loan

ANZ Bank Limited - Secured Loan

NZX Ltd - Unsecured

The interest rate applicable to the ANZ Bank Limited loan is currently fixed for periods of one month. The period for fixing the rate can be changed with the agreement of the lendor for periods up to one year or longer or the borrower can elect to switch to a floating rate.The fixed interest rates are set with reference to the Reuters BKBM rate plus a margin of 2% or 4%.The floating rate is set at the ANZ Bank Corporate Indicator rate plus a margin of 2% or 4%.

Related party payables incur interest at rates disclosed at note 17 to the financial statements and are payable on demand and are unsecured.

21



13. LOANS AND BORROWING (continued)

Security

ANZ Bank Limited

Loan facilities 2017 2016

NZ$ NZ$

The Group has the following undrawn borrowing facilities

ANZ Bank Limited - Secured Loan - 1,207,000

Total undrawn loan facilities - 1,207,000

14. CONTRIBUTED CAPITAL

No. of shares NZ$

Balance as at 31 March 2015 745,125,328 -

Shares issued to settled of outstanding debts 110,000,000 -

146,281,333 -

Shares issued at 0.075 cents per share 39,999,999 -

19,491,232,812 475,758Share consolidation 1:25 (19,711,333,261) -

1,597,537 21,447

Balance as at 31 March 2016 and 31 March 2017 822,903,748 497,205

Shares issued on conversion of capital note at 1.3425 cents per share

All ordinary shares carry equal rights in respect of voting and receipt of dividends. Ordinary shares do not have a par value.

As a result of a reverse acquisition in the prior year, the financial statements have been prepared as a continuation of the financial statements of 16 Park Avenue Limited, as such the carrying amount of contributed capital reflects the value of shares issued by 16 Park Avenue Limited. However, as Chow Group Limited is the legal parent of the group and the NZAX listed entity, the number of shares shown below represents the number of shares issued by that entity.

Shares issued on conversion of capital note at 0.0537 cents per share

Shares issued to John Chow Trust and Michael Chow Trust at 0.0390 cents per share recorded at the deemed consideration paid on the acquisition of 16 Park Avenue Limited (refer below)

-General security agreement dated 23 September 2015 granted by 16 Park Avenue Limited in favour of lender. -Registered first ranking mortgage dated 23 September 2015 granted by 16 Park Avenue Limited in favour of lender over property owned by the Group and situated at 10-14 Park Avenue. -Registered first ranking mortgage dated 23 September 2015 granted by 16 Park Avenue Limited in favour of lender over property owned by the Group and situated at 16-20 Park Avenue.

22



15. RETAINED EARNINGS2017 2016

NZ$ NZ$

Opening Balance 8,006,653 (45,115)

Profit for the year 1,468,295 8,051,768

Closing Balance 9,474,948 8,006,653

16. NET CASH OUTFLOW FROM OPERATING ACTIVITIES

Reconciliation of net profit / (loss) with cash inflow from operations2017 2016

NZ$ NZ$

Net Profit / (loss) for the year 1,468,295 8,051,768

Adjustment for non cash items

Management fees paid 150,000 52,250

Interest paid to related parties 104,056 16,839

Interest Income from related parties (102,104) (126,390)

Net movement in deferred tax 112,056 132,102

Change in fair value of investment property (1,021,563) (8,350,314)- 403,016

Subvention Income - (340,473)Depreciation 4,870 -Provision for doubtful debts 21,170 -

Adjustment for movements in working capital items

Trade and other receivables 35,422 (43,079)

Prepayments 39,312 (66,456)

Income Tax 67,668 36,931

Trade and other payables (144,127) 955,024

Adjustment for items shown in investing and financing activities

Interest paid capitalised in investment property - (39,734)

Accounts payable capitalised in investment property - (150,000)

Net cash inflow from operating activities 735,055 531,484

Loss on acquisition

23



17. RELATED PARTY TRANSACTIONS

17.1. Related Parties:

Common directors and shareholders (John Chow and Michael Chow)

1135 Arawa Street Limited

318 Lambton Quay Limited

AE Management Limited

AE Wellington Property Limited

CGML Limited

GS Entertainment Limited

Park Avenue Project Limited

Common directors and shareholders (Brent King)

Investment Research Group Limited

17.2. Related party balances

The following balances were held with related parties at year end.2017 2016

NZ$ NZ$

Related party payable balances at year end

CGML Limited 748,019 652,738

Investment Research Group Limited - 9,200

Park Ave Residence Limited - -

16 Park Avenue Limited - 72,735

748,019 734,673

Related party Loans payable at year end

318 Lambton Quay Limited 1,309,417 1,223,042CGML Limited - 26,778Park Avenue Project Limited 345,552 326,700

1,654,969 1,576,520

Total Related Party Payables 2,402,988 2,311,193

The Company had advances payable to the following entities with common directorship:

The related party loans payable are unsecured, repayable on demand and are interest bearing.

Unless otherwise stated, transactions with related parties in the years reported did not include any special terms, conditionsor guarantees.

The Group has not incurred any costs with regard to key management personnel compensation. These costs have been incurred by related parties external to the Group.

The related party payables arise from the purchase of services. The payables are unsecured, are repayable on demand and bear no interest.

24



17. RELATED PARTY TRANSACTIONS Continued

2017 2016

NZ$ NZ$

Related party Loans receivable at year end

GS Entertainment Limited 9,509 8,990

1135 Arawa Street Limited 216,255 204,458

AE Wellington Property Limited 1,861,997 1,759,722

AE Management Limited 82 78

Total Related Party Receivables 2,087,843 1,973,248

17.3. Related party transactions

Revenue

Related party interest income

16 Park Avenue Limited received $11,797 (2016: $4,458) from 1135 Arawa Street Limited.

16 Park Avenue Limited received $2 (2016: $4) from AE Management Limited.

16 Park Avenue Limited received $101,577 (2016: $61,082) from AE Wellington Property Limited.

16 Park Avenue Limited received $519 (2016: $496) from GS Entertainment Limited.

16 Park Avenue Limited received Nil (2016: $60,350) from Park Avenue Project Limited

Subvention Payment Income

ExpensesAdvisory FeesChow Group Limited paid $31,500 to Investment Research Group Limited (2016: $5,625).

16 Park Avenue Limited received no subvention income for the year ended 31 March 2017 (2016: $340,473 - Subvention income received from AE Wellington Property Limited).

The related party loans receivable are unsecured, repayable on demand and are interest bearing. No provisions are held against receivables from related parties and no amounts have been written off during the year.

The Company had advances receivable from the following entities with common directorship

The following transactions were carried out with the following related parties during the year ended 31 March 2017.

All interest in 2017 was calculated monthly at 5.77% for the first quarter, 5.77% for the second quarter,5.77% for the third quarter, and 5.77% for the fourth quarter. In 2016, interest was calculated monthly at 6.70% for the first quarter, 6.22% for the second quarter, and 5.99% for the third and 5.77% for the fourth quarters.

25




17. RELATED PARTY TRANSACTIONS Continued

Related party interest expense

16 Park Avenue Limited paid:

$71,373 (2016: $16,542) to 318 Lambton Quay Limited.

Nil (2016: $153,100) to AE Wellington Property Limited.

$36,375 (2016: $1,612) to CGML Limited.

$18,851 (2016: $Nil) to Park Ave Project Limited.

Management expense

16 Park Avenue Limited paid $114,000 (2016: $52,250) to CGML Limited.

Chow Group limited has paid $36,000 (2016: $12,500) to CGML Limited.

Project companies

Directors fees2017 2016

NZ$ NZ$

Directors fees 72,000 6,000

Transfer of Shares

Amounts recharged from project companies in relation to refurbishment works on behalf of 16 Park Avenue Limited that are capitalised or expensed (GST excluded).

On 30 April 2016, the shares of 16 Park Avenue Limited were transferred to Park Ave Residence Limited. The payment will be $1 if demanded by the John Chow Investment Trust and The Michael Chow Investment Trust.

All interest in 2017 was calculated monthly at 5.77% for each quarter. In 2016, interest was calculated monthly at 6.70% for the first quarter, 6.22% for the second quarter, 5.99% for the third quarter, and 5.77% for the fourth quarter. In 2017, no related party interest has been capitalised in relation to qualifying assets - refer note 4 and 10 (2016: $154,415).

In 2016, 16 Park Avenue Limited was recharged $2,093,010 from Park Avenue Project Limited.

26




18. FINANCIAL INSTRUMENTS

Capital management policy

The gearing ratios at 31 March 2017 and 2016 were as follows2017 2016

NZ$ NZ$

Net debt 8,353,356 8,779,077

Equity plus net debt 18,325,509 17,282,935Gearing Ratio 46% 51%

Classification of financial assets and liabilities

Available-for-Sale

Loans and receivables

Other Financial liabilities Total

2017 NZ $ NZ $ NZ $ NZ $

Financial assets

Cash and cash equivalents - 945,966 - 945,966

Trade and other receivables - 37,716 - 37,716

Related party receivables - 2,087,843 - 2,087,843

Listed securities 161,550 - - 161,550

161,550 3,071,525 - 3,233,075

The Group manages its capital structure and makes adjustment to it, in light of changes in economic and trading conditions within its markets. To maintain or adjust the capital structure, the Group may increase or decrease their borrowings or return capital to shareholders.

Consistent with others in the industry, the Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including current and non-current borrowings including related party payables) less cash and cash equivalents. Total capital is calculated as equity as shown in the Statement of Financial Position plus net debt.

The Group's strategy is to operate the gearing ratio within 40% to 65%. The current gearing ratio of 46% is in line with the Group's strategy. The 2016 gearing ratio of 51% was line with the Group's strategy.

The carrying amounts presented in the statement of financial position relate to the following categories of financial assets and liabilities.

27




18. FINANCIAL INSTRUMENTS (continued)

Available-for-Sale



2017 NZ $ NZ $ NZ $ NZ $

Financial liabilities Trade creditors and other payables - - 299,922 299,922Loans and borrowings - - 6,896,334 6,896,334Related party payables - - 2,402,988 2,402,988

- - 9,599,244 9,599,244

Available-for-Sale



2016 NZ $ NZ $ NZ $ NZ $

Financial assets

Cash and cash equivalents - 876,449 - 876,449

Trade and other receivables - 10,632 - 10,632

Related party receivables - 1,973,248 - 1,973,248

Listed securities 161,550 - - 161,550

161,550 2,860,329 - 3,021,879

Financial liabilities Trade creditors and other payables - - 444,049 444,049Loans and borrowings - - 7,344,333 7,344,333Related party payables - - 2,311,193 2,311,193

- - 10,099,575 10,099,575

Financial instrument risk management

The Group has exposure to the following risks from its use of financial instruments:

- Credit Risk- Liquidity Risk- Interest Rate Risk

The Group is exposed to market risk through their use of financial instruments and specifically to interest rate risk and certain other price risks, which result from both its operating and investing activities.

The Group has a series of policies to manage the risk associated with financial instruments. The Group is not actively engaged in the trading of financial instruments. As part of this policy, limits of exposure have been set and are monitored on a regular basis.

28



Chow Group LimitedNotes to the Consolidated Financial StatementsFor the year ended 31 March 201718. FINANCIAL INSTRUMENTS (continued)

(i) Credit risk

(ii) Liquidity risk

0 to 6 months

7 to 12 months

1 to 2 years

Over 2 years Total

2017 NZ $ NZ $ NZ $ NZ $ NZ $

299,922 - - - 299,922Loans and borrowings 346,861 333,488 6,642,297 - 7,322,646Related party payables 2,402,988 - - - 2,402,988

3,049,771 333,488 6,642,297 - 10,025,556

0 to 6 months

7 to 12 months

1 to 2 years

Over 2 years Total

2016 NZ $ NZ $ NZ $ NZ $ NZ $

444,049 - - - 444,049Loans and borrowings 379,700 375,370 694,415 6,652,689 8,102,174Related party payables 2,311,193 - - - 2,311,193

3,134,942 375,370 694,415 6,652,689 10,857,416

Credit risk is the risk that a third party will default on its obligation to the Group, causing the Group to incur a loss.

The Group has no significant concentration of risk in relation to cash and cash equivalents, trade debtors and other financial assets. The directors review the recoverability of related party receivables on a regular basis and are satisfied that all amounts are recoverable.

The Group continuously monitors defaults of customers and other counterparties, identified either individually or collectively by the Group, and incorporates this information into its credit risk controls.

Further details in relation to the credit quality of financial assets is provided in Note 8.

Liquidity risk represents the Group's ability to meet is contractual obligations as they fall due. The Group manages liquidity risk by managing cash flows and ensuring that adequate credit lines are in place to cover any potential short falls.

The Group manages its liquidity needs by monitoring scheduled debt servicing payments for long-term financial liabilities as well as forecast cash inflows and outflows due in day-to-day business. The data used for analysing these cash flows is consistent with that used in the contractual maturity analysis below. Net cash requirements are compared to available borrowing facilities in order to determine headroom or any shortfalls. This analysis shows that available borrowing facilities are expected to be sufficient over the foreseable future.

The Group considers expected cash flows from financial assets in assessing and managing liquidity risk, in particular its cash resources, trade receivables and the provision of funding from related parties and bank loan facilities.

The Group's financial liabilities have contractual maturities (including interest payments where applicable) as summarised below:

Trade creditors and other payables

Trade creditors and other payables

29



Chow Group LimitedNotes to the Consolidated Financial StatementsFor the year ended 31 March 201718. FINANCIAL INSTRUMENTS (continued)

(iii) Interest rate risk

Interest rate risk profileAt the reporting date the interest rate profile of interest-bearing financial instruments was:

2017 2016NZ$ NZ$

Fixed interest instrumentsFinancial assets 2,087,843 1,973,248Financial Liabilities (1,654,969) (1,576,520)Total 432,874 396,728

Variable rate instruments Financial assets - -Financial Liabilities (6,891,668) (7,291,667)Total (6,891,668) (7,291,667)

Sensitivity analysis

Profit for the year

Equity Profit for the year

Equity

NZ$ NZ$ NZ$ NZ$

93,040 93,040 84,255 84,255

(93,040) (93,040) (84,255) (84,255)

19. SEGMENT REPORTING

Interest rate risk is the risk that cash flows from a financial instrument will fluctuate because of changes in market interestrates.

The following analysis illustrates the sensitivity of profit and equity to a reasonably possible change in interest rates of 2%(2016: +/- 2%). These changes are considered to be reasonably possible based on observation of current market conditions. The calculations are based on a change in the average market interest rate for each period, and the financial instruments held at each reporting date that are sensitive to changes in interest rates. All other variables are held constant.

The Financial assets and liabilities are fixed for various terms. Refer to notes 7, 13 and 17 for additional details.

The Group operates in one business segment being accommodation and hospitality, and one geographic location being in New Zealand. The amounts disclosed in the statement of comprehensive income and the statement of financial position reflect the operations and assets of the segment.

The Group has determined that its chief operating decision makers is the Board of Directors on the basis that it is this group which determines the allocation of resources to segments and assesses their performance.

Geographical segments

All operations, assets, and revenues were generated within New Zealand.

Major customers

The Group had no major customers representing greater than 10% of the Group's total revenue.

2% (2016: 2%) increase in interest rate of borrowings2% (2016: 2%) decrease in interest rate of borrowings

2017 2016

30



20. EARNINGS PER SHARE

2017 2016NZ$ NZ$

Profit after taxation 1,468,295 8,051,768Weighted average number ordinary shares on issue 822,903,748 133,611,248

Basic profit per share in cents 0.18 6.03

Diluted Profit per share in cents 0.18 6.03

21. NET TANGIBLE ASSETS PER SHARE

2017 2016NZ$ NZ$

Total Assets 19,808,528 18,660,840Less Intangible assets - Deferred tax assets - -Tangible assets 19,808,528 18,660,840Less total liabilities 9,836,375 10,156,982

Net tangible assets 9,972,153 8,503,858

Number of ordinary shares on issue 822,903,748 822,903,748

Net tangible assets per share in cents 1.21 1.03

22. SUBSIDIARY

Name of legal subsidiary Principal activity

2017 2016

16 Park Avenue Limited Operation of Accommodation 100% 100%

The subsidiary is incorporated in New Zealand and has a 31 March balance date.

23. COMMITMENTS

The earnings and weighted average number of ordinary shares used in the calculation of basic and diluted earnings per share are as follows:

Ownership interest and voting rights

The net tangible assets and number of shares used in the calculation are as follows:

As at 31 March 2017, Chow Group Limited had no unspent capital commitments in relation to construction obligations (2016: Nil).

31



24. CONTINGENT LIABILITIES

25. EVENTS AFTER THE REPORTING PERIOD

26. BUSINESS COMBINATION

Carrying amount of identified assets and liabilities purchased as follows:

2016NZ$

Cash and cash equivalents 81,675Available-for-sale financial assets 161,550Taxation receivable 2,150Deferred Tax 12,425Trade creditors and other payables (106,945)Loans and borrowings (56,666)Convertible Notes (21,447)Carrying value of net assets 72,742Deemed consideration 475,758

Loss on acquisition 403,016

No adjusting or significant non-adjusting events have occurred between the reporting date and the date of authorisation.

As at 31 March 2017, Chow Group Limited has a contingent liability of $15,000 with ASB Bank to meet NZAX requirements.

The acquired company contributed revenue of $Nil and loss before tax of $616,670 for the period from acquisition to 31 March 2016.

If the acquired company had been acquired at the begining of the year its contribution to the reporting period would be revenue of $Nil and loss before tax of $709,808.

In reverse acquisition accounting, the cost of the business combination is deemed to have been incurred by the legal subsidiary, 16 Park Avenue Limited. The acquirer for accounting purposes, in the form of equity instruments issued to the owners of the legal parent, Chow Group Limited (the acquiree for accounting purposes).

On 26 February 2016 Chow Group Limited acquired 16 Park Avenue Limited through the issue of 19,491,232,812 shares to the former owners of 16 Park Avenue Limited.

In accordance with IFRS, the Group financial statements have been prepared using reverse acquisition accounting. The consolidated financial statements are issued in the name of the legal parent, Chow Group Limited, but represent a continuation of the financial statements of the legal subsidiary 16 Park Avenue Limited (the accounting acquirer) following the reverse acquisition of Chow Group Limited (The accounting acquiree) on 26 February 2016.

32


The company is listed on the New Zealand Alternative Exchange.

LARGEST SHAREHOLDERS (As at 19 July 2017) (Listing Rule 10.5.5(b))

Rank Shareholder Holding %1 Ka Ming Chow & Ka Yu Chow 365,098,082 44.372 Ka Yu Chow & Ka Ming Chow 363,930,749 44.233 Kenneth Paul Donelan 5,544,572 0.674 Ra Compusoft Private Limited 5,000,000 0.615 High Street Nominees No 7 Limited 4,700,000 0.576 Qijun Zhu 3,297,863 0.47 Snowdon Peak Investments Limited 3,031,785 0.378 Lup Yen Chow 2,520,000 0.319 Hung Yee Chow 2,400,000 0.2910 Yuen Kwan Chow 2,030,000 0.2511 He Yen Chow 2,000,000 0.2411 Qing Yang Xu 2,000,000 0.2411 So Chow 2,000,000 0.2411 Lai Kwan Chow 2,000,000 0.2411 John Cheung 2,000,000 0.2412 Lim Chee Mei Jasmine 1,800,000 0.2213 Anthony Edwin Falkenstein 1,360,000 0.1714 Stefan Thieu 1,200,000 0.1514 Zhan Han 1,200,000 0.1515 John Robert James Mack 1,095,773 0.1316 Bruce Andrew Lindsay 1,067,000 0.1317 Ronald Joseph Gillatt 1,000,107 0.1218 Clinton Neil Webber 1,000,000 0.1218 Ya Jiu Xu 1,000,000 0.1218 Michael Sew Wun Yin 1,000,000 0.1219 Bf Investment Holdings Pty Limited 800,000 0.119 Michelle Bryant 800,000 0.119 Mikhael Mikhael 800,000 0.119 Li Bin Yang 800,000 0.119 Kai Ang Liu 800,000 0.120 Ivan Albert Young & Mary Young 665,000 0.08 783,940,931 95.28

CHOW GROUP LIMITEDSHAREHOLDER AND STATUTORY INFORMATION


SPREAD OF SHAREHOLDERS (as at 19 July 2017)

Number of % Number of % Shareholders SharesSize of Holding 1-1,000 1,292 77.93 65,688 0.011,001-5,000 49 2.96 144,299 0.025,001-10,000 29 1.75 248,753 0.0310,001-50,000 95 5.73 2,650,301 0.3250,001-100,000 46 2.77 3,861,703 0.47Greater than 100,000 147 8.86 815,933,004 99.15 1,658 100.00 822,903,748 100.00 Geographic Spread New Zealand 1,562 94.21 811,749,868 98.64Other 96 5.79 11,153,880 1.36 1,658 100.00 822,903,748 100.00

CHOW GROUP LIMITEDSHAREHOLDER AND STATUTORY INFORMATION (continued)


SUBSTANTIAL PRODUCT HOLDERS (as at 19 July 2017)

The following information is provided pursuant to section 293 of the Financial Markets Conduct Act 2013.

This information reflects the Company’s records and disclosures made under section 280(1)(b) of the Financial Markets Conduct Act 2013.

Shares Beneficially Held % Ka Ming Chow & Ka Yu Chow 729,O28,831 44.29 Ka Yu Chow & Ka Ming Chow 729,O28,831 44.29

The total number of voting securities of the Company on issue at 19 July 2017 was 822,903,748 paid ordinary shares.

DIRECTORS

During the year the board of directors comprised: Appointed Resigned Directors Ka Ming (Michael) Chow 26 February 2016 - Ka Yu (John) Chow 26 February 2016 - Brent King 26 February 2016 - Clinton Webber 26 February 2016 -




STATEMENT OF DIRECTORS’ SECURITY HOLDINGS (as at 31 March 2017)

Shares Held Shares Beneficially Personally Owned / Held by Associated Persons

Ka Ming (Michael) Chow - 729,028,831 Ka Yu (John) Chow - 729,028,831 Brent King - 5,000,000 Clinton Webber 1,000,000 -

Mr Ka Ming (Michael) Chow’s shares beneficially owned held by associated persons comprise his interest as a beneficiary in the Michael Chow Trust which is the holder of 365,098,082 shares and John Chow Trust which is the holder of 363,930,749 shares.

Mr Ka Yu (John) Chow’s shares beneficially owned held by associated persons comprise his interest as a beneficiary in the Michael Chow Trust which is the holder of 365,098,082 shares and John Chow Trust which is the holder of 363,930,749 shares.



STATEMENT OF DIRECTORS’ SECURITY HOLDINGS (as at 31 March 2017) (continued)

Mr. King’s shares beneficially owned held by associated persons comprise his interest as the owner of all the shares in Snowdon Peak Investments Limited, which the Company is the holder of 3,031,785 shares as at 19 July 2017.

Mr. Webber is personally the holder of 1,000,000 shares

During the period 1 April 2016 to 19 July 2017 Mr King disposed of shares by way of on market sales to reduce shareholding from 7,000,000 to 3,031,785. The transactions are summarized below:

• Sold 2,000,000 shares between 5 January 2017 to 13 January 2017 for $34,185.00• Sold 646,815 shares between 19 June 2017 and 27 June 2017 for $8,430.38• Sold 1,321,400 shares on 17 July 2017 for $17,293.50

There were no other securities transactions disclosed to the Board and entered into the Interests Register for the year to 31 March 2017.





The following are the directorships held by the Chow Group Limited Directors as at 31 March 2017

Ka Yu Chow 1135 Arawa Street Limited (5133841) Director And Shareholder 13 Gore Street Limited (3397434) Director And Shareholder 137 Quay Street Limited (5764057) Director And Shareholder 16 Park Avenue Limited (3746977) Director 318 Lambton Quay Limited (3038808) Director And Shareholder 322 K Rd Limited (3746960) Director And Shareholder 75 Victoria Street Limited (3038807) Director And Shareholder 89 Courtenay Place Limited (1645271) Director And Shareholder 89 CP Hotel Limited (6249773) Director And Shareholder AE Management Limited (3038826) Director And Shareholder AE Wellington Property Limited (982640) Director And Shareholder Arawa Project Limited (5764053) Director And Shareholder B & M Entertainment Limited (1111339) Shareholder CGML Limited (3038752) Director And Shareholder Chow Group Capital Investment Limited (5881530) Director And Shareholder Chow Group Limited (1272488) Director Courtenay Capital Investments Limited (4530398) Director And Shareholder Cubic Bar Limited (4530218) Director And Shareholder Delores Properties Limited (3038747) Director And Shareholder Food Republic Limited (5133744) Director And Shareholder GS Entertainment Limited (3397415) Director And Shareholder Inno Capital Management Limited (5817191) Director And Shareholder Inno Capital No.3 Limited (5827370) Director And Shareholder Inno Capital No.4 Limited (5827360) Director And Shareholder Inno Capital No.5 Limited (5828069) Director And Shareholder Inno Project Management Limited (5881455) Director And Shareholder JV South Auckland Holdings 2016 Limited (6124509) Director And Shareholder KR Entertainment Limited (3746985) Director And Shareholder NZ Project 16 Limited (4976519) Director And Shareholder NZ Project 17 Limited (5133261) Director And Shareholder NZ Project 21 Limited (5133882) Director And Shareholder NZ Project 22 Limited (5763987) Director And Shareholder NZ Project 26 Limited (5763979) Director And Shareholder NZ Project 28 Limited (5881456) Director And Shareholder NZ Project 29 Limited (5881547) Director And Shareholder NZ Project 30 Limited (5881426) Director And Shareholder NZ Project 38 Limited (6192309) Director And Shareholder NZ Project 41 Limited (6259339) Director And Shareholder




Ka Yu Chow NZ Project 5 Limited (3397472) Director And Shareholder Park Ave Residence Limited (5133641) Director Park Avenue Project Limited (4530319) Director And Shareholder Pegasus General Partner Limited (6266731) Director And Shareholder Stonewood Fire Services Limited (6133151) Director And Shareholder Stonewood Homes (ChCh) Franchisee Limited (5896035) Director And Shareholder Stonewood Homes (Haml) Franchisee Limited (6186770) Director And Shareholder Stonewood Homes (N Akl) Franchisee Limited (6186600) Director And Shareholder Stonewood Homes (N Ply) Franchisee Limited (6186732) Director And Shareholder Stonewood Homes (P Nth) Franchisee Limited (6186756) Director And Shareholder Stonewood Homes (Taup) Franchisee Limited (6191783) Director And Shareholder Stonewood Homes (Wair) Franchisee Limited (6192327) Director And Shareholder Stonewood Homes (Wgtn) Franchisee Limited (6096612) Director And Shareholder Stonewood Homes Mckenzie Shute Limited (4530358) Director And Shareholder Stonewood Homes NZ (Akl) Franchisor Limited (6095729) Director And Shareholder Stonewood Homes NZ (ChCh) Franchisor Limited (5896132) Director And Shareholder Stonewood Homes South Auckland 2016 Limited (6125733) Director And Shareholder Stonewood Tamaki Project Limited (6116628) Director And Shareholder The Drink Limited (6249457) Director And Shareholder Top of Tory Limited (1558229) Director And Shareholder Urban Hub Limited (5764107) Director And Shareholder VS Limited (2113605) Director And Shareholder Willis Project Limited (3397411) Director And Shareholder Willis Street Parking Limited (2199018) Director And Shareholder YKC Limited (1611445) Director And Shareholder


DIRECTORSHIPS HELD BY THE CHOW GROUP LIMITED DIRECTORS as at 31 March 2017 (continued)

Ka Ming Chow 1135 Arawa Street Limited (5133841) Director And Shareholder 13 Gore Street Limited (3397434) Director And Shareholder 137 Quay Street Limited (5764057) Director And Shareholder 16 Park Avenue Limited (3746977) Director 318 Lambton Quay Limited (3038808) Director And Shareholder 322 K Rd Limited (3746960) Director And Shareholder 75 Victoria Street Limited (3038807) Director And Shareholder 89 Courtenay Place Limited (1645271) Director And Shareholder 89 CP Hotel Limited (6249773) Director And Shareholder AE Management Limited (3038826) Director And Shareholder AE Wellington Property Limited (982640) Director And Shareholder Arawa Project Limited (5764053) Director And Shareholder B & M Entertainment Limited (1111339) Director And Shareholder CGML Limited (3038752) Director And Shareholder Chow Group Capital Investment Limited (5881530) Director And Shareholder Chow Group Limited (1272488) Director Courtenay Capital Investments Limited (4530398) Director And Shareholder Cubic Bar Limited (4530218) Director And Shareholder Delores Properties Limited (3038747) Director And Shareholder Food Republic Limited (5133744) Director And Shareholder GS Entertainment Limited (3397415) Director And Shareholder Inno Capital Management Limited (5817191) Director And Shareholder Inno Capital No.3 Limited (5827370) Director And Shareholder Inno Capital No.4 Limited (5827360) Director And Shareholder Inno Capital No.5 Limited (5828069) Director And Shareholder Inno Project Management Limited (5881455) Director And Shareholder JV South Auckland Holdings 2016 Limited (6124509) Director And Shareholder KR Entertainment Limited (3746985) Director And Shareholder NZ Project 16 Limited (4976519) Director And Shareholder NZ Project 17 Limited (5133261) Director And Shareholder NZ Project 21 Limited (5133882) Director And Shareholder NZ Project 22 Limited (5763987) Director And Shareholder NZ Project 26 Limited (5763979) Director And Shareholder NZ Project 28 Limited (5881456) Director And Shareholder NZ Project 29 Limited (5881547) Director And Shareholder





Ka Ming Chow NZ Project 30 Limited (5881426) Director And Shareholder NZ Project 38 Limited (6192309) Director And Shareholder NZ Project 41 Limited (6259339) Director And Shareholder NZ Project 5 Limited (3397472) Director And Shareholder Park Ave Residence Limited (5133641) Director Park Avenue Project Limited (4530319) Director And Shareholder Pegasus General Partner Limited (6266731) Director And Shareholder Stonewood Fire Services Limited (6133151) Director And Shareholder Stonewood Homes (ChCh) Franchisee Limited (5896035) Director And Shareholder Stonewood Homes (Haml) Franchisee Limited (6186770) Director And Shareholder Stonewood Homes (N Akl) Franchisee Limited (6186600) Director And Shareholder Stonewood Homes (N Ply) Franchisee Limited (6186732) Director And Shareholder Stonewood Homes (P Nth) Franchisee Limited (6186756) Director And Shareholder Stonewood Homes (Taupo) Franchisee Limited (6191783) Director And Shareholder Stonewood Homes (Wair) Franchisee Limited (6192327) Director And Shareholder Stonewood Homes (Wgtn) Franchisee Limited (6096612) Director And Shareholder Stonewood Homes Mckenzie Shute Limited (4530358) Director And Shareholder Stonewood Homes NZ (Akl) Franchisor Limited (6095729) Director And Shareholder Stonewood Homes NZ (ChCh) Franchisor Limited (5896132) Director And Shareholder Stonewood Homes South Auckland 2016 Limited (6125733) Shareholder Stonewood Tamaki Project Limited (6116628) Director And Shareholder The Drink Limited (6249457) Director And Shareholder Top of Tory Limited (1558229) Director And Shareholder Urban Hub Limited (5764107) Director And Shareholder VS Limited (2113605) Director And Shareholder Willis Project Limited (3397411) Director And Shareholder Willis Street Parking Limited (2199018) Director And Shareholder YKC Limited (1611445) Shareholder




Clinton Neil Webber Century Finance Limited (4383858) Director And Shareholder Chow Group Limited (1272488) Director And Shareholder CSL Limited (4363519) Director And Shareholder Inno Capital Management Limited (5817191) Director And Shareholder Inno Capital No.3 Limited (5827370) Director Inno Capital No.4 Limited (5827360) Director Inno Capital No.5 Limited (5828069) Director Inno Project Management Limited Director And Shareholder JV South Auckland Holdings 2016 Limited (6124509) Director Pegasus General Partner Limited (6266731) Director And Shareholder Stonewood Fire Services Limited (6133151) Director Stonewood Homes (ChCh) Franchisee Limited Director Stonewood Homes NZ (ChCh) Franchisor Director Limited (5896132) Stonewood Homes (Wgtn) Franchisee Director Limited (6096612) Stonewood Homes Mckenzie Shute Director Limited (4530358) Stonewood Homes NZ (Akl) Franchisor Director Limited (6095729) Stonewood Homes South Auckland 2016 Director Limited (6125733) Stonewood Tamaki Project Limited (6116628) Director Webber Capital Limited (4384498) Director And Shareholder Webber Capital No. 2 Limited (5484541) Director And Shareholder Webber Capital No.3 Limited (5599125) Director And Shareholder



Director Company PositionBrent Douglas King A.I.S. Limited (423623) Director And Shareholder Askridge Holdings Limited (560224) Director And Shareholder Barter Investments Limited Director And Shareholder Chow Group Limited (1272488) Director And Shareholder Corporate Holdings Limited Director Equity Investment Advisers Limited (2132665) Director Investment Research Group Limited (4201658) Director And Shareholder King Capital & Investment Corporation Director And Shareholder Limited (4153558) Kohaus Limited (630716) Director And Shareholder Moneyonline Limited (2132664) Director Mykco Limited (3568071) Director And Shareholder Octo International Limited (4299098) Director Snowdon Peak Investments Limited (309031) Director And Shareholder Transaction Holdings Limited (5686538) Director

DIRECTORS’ REMUNERATION AND OTHER BENEFITS

The following is the remuneration paid to the Directors of Chow Group Limited for the year to 31 March 2017. Director’s fees Other Remuneration Ka Ming (Michael) Chow Nil $36,000 Ka Yu (John) Chow Nil $36,000 Brent King $36,000 Nil Clinton Webber $36,000 Nil

Remuneration and Other Benefits

The Directors of Chow Group Limited did not receive any other benefits from Chow Group Limited in the year to 31 March 2017.

EMPLOYEES REMUNERATION (EXCLUDING DIRECTORS)

There were no employees who received remuneration in excess of $100,000 during the year.



REGISTERED OFFICELevel 4, 89 Courtenay Place Wellington 6011www.chowgroup.co.nz

AUDITORS Staples Rodway AucklandLevel 9Tower Centre45 Queen St Auckland

PO Box 3899Shortland St Auckland 1140New Zealand

BANKERS ASB Bank LtdANZ Bank New Zealand Ltd

CORPORATE INFORMATION

SHARE REGISTRY Link Market ServicesLevel 11, Deloitte Centre80 Queen StAuckland

PO Box 91976Auckland 1142www.linkmarketservices.co.nz

INVESTMENT BANKERS Investment Research Group LtdLevel 7 Swanson House12-26 Swanson St Auckland+64 9 304 0145www.irg.co.nz

SOLICITORSLowndes LawLevel 5 Lowndes House18 Shortland StreetAuckland

PO Box 7311Auckland 1141Ph +64 9 373 3331

Level 4, 89 Courtenay Place, Wellington, 6011, New ZealandEmail: [email protected] Tel: +64 4 333 0888 www.chowgroup.co.nz

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