for personal use only - rhipe · growth plans with a clear vision to expand its “cloud first, ......

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Contents

Chairman’s Report 01 Letter from the Managing Director 02 Operating and Financial Review 03 Directors’ Report 07 Remuneration Report 12 Corporate Governance Statement 23 Auditor’s Independence Declaration 30 Consolidated Statement of Profit or Loss and Other Comprehensive Income 31 Consolidated Statement of Financial Position 32 Consolidated Statement of Changes in Equity 33 Consolidated Statement of Cash Flows 34 Notes to the Financial Statements 35 Directors’ Declaration 76 Independent Auditor’s Report 77 Additional Information for Listed Public Companies 79

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RHIPE LIMITED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2015

1

Chairman’s Report Dear Shareholders, I am pleased to report that in our first full year as a public company, rhipe Limited is delivering on its growth plans with a clear vision to expand its “Cloud First, Channel First” strategy. The overriding objective from the board and our executives is to create long-term shareholder value by growing rhipe’s core cloud licensing subscription revenues through existing and new vendor licensing programs. During the 2015 financial year, rhipe has launched new vendor products and license programs, expanded new geographical reach and added more customers while at the same time investing in the business to capitalise on the rapidly emerging public cloud industry. The subscription-based foundation of our company, our strong expertise in cloud technology and the deep relationships we maintain with many global technology vendors, has led to rhipe’s endorsement to now sell public cloud licensing programs on behalf of Microsoft, VMWare and more recently IBM Softlayer. These programs are all being launched in the 2016 financial year. I would like to take this opportunity to thank the entire employee base at rhipe for their hard work in achieving another year of growth and building a platform that bodes well for the future of private, hybrid and public cloud. The management team has continued to manage the complexities that come with significant growth while maintaining key vendor relationships at the highest levels and building the partner base in our service provider channel. The board is extremely pleased with the performance of the executive management team and feels confident in their ability to continue to forge ahead in the exciting cloud licensing environment across the Asia Pacific Region. We would like to thank our vendor partners for their continued support towards rhipe and meeting our mutual growth objectives. In particular, rhipe maintains strong relationships with Microsoft, VMWare, Citrix, Veeam, RedHat, McAfee, Trend Micro, Zimbra, LiveTiles and more recently Skykick and IBM Softlayer. In line with expectations, the Company increased its operating revenue for the year from $74.5 million to $108.8 million, or 46% growth (+45% pcp) including a 41% increase in annuity licence subscription revenue. Service Provider customers reached more than 1,600 at 30 June 2015, up from 1,300+ same time last year. The business is well funded with $12.4m of cash and cash equivalents at year end. With a recurring revenue model, rhipe commences the 2016 financial year strongly with monthly subscriptions and high growth rates compounded by new vendors, new public cloud licensing programs, new customers and new geographies. Our outlook for the business remains very positive and based on market growth and new vendor programmes and regions, we anticipate +40% revenue growth for fiscal 2016. Again, I would like to thank the management team for their substantial efforts in 2015 and thank all of our shareholders for their continued support. Yours Sincerely

Mike Hill Executive Chairman

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Letter from the Managing Director Dear Shareholders, Rhipe is passionate about helping service providers to adapt and thrive in the emerging cloud economy. Our mantra of “Cloud First, Channel First” reflects our heritage and strong commitment to building a subscription based business via a growing channel of I.T. service provider partners. Just 12 months ago, rhipe fulfilled its strategic vision by selling and managing licensing programs that allowed service providers to host software on Private cloud hardware. Fast forward one year and rhipe has blossomed into a business that now offers software licensing, services, support and infrastructure programs to support service providers in their Public, Private and Hybrid cloud implementations. As I reflect back on my first year with rhipe, I am very proud to say that we have achieved our targeted 40%+ growth in license revenue, with gross margins of 15%+, while also investing in the people, programs and systems to launch our “Whole of Cloud” future. Industry analyst IDC predicts that the Public Cloud market will rapidly accelerate to reach a projected spend of USD 127 Billion by 20181. Although this projection includes offerings from every vendor in every geography, I believe that rhipe’s new public and hybrid cloud offerings from Microsoft, IBM SoftLayer and others will position rhipe as a leading wholesaler of cloud licensing and infrastructure in Australia and South East Asia. Our public and hybrid cloud offerings will move rhipe into a much bigger addressable market with rates of expansion that should continue to support our ongoing growth at historical rates. I would like to highlight a number of significant achievements from the 2015 Financial Year:

Exceeding $100M in subscription license revenue; Achieving a 66% growth in Asian revenue with a 300%+ growth in new partner agreements; Building a new experienced executive team including a new CEO, CFO as well as Chief

Commercial, Marketing, Technology, and Strategy Officers; Acquiring award-winning Microsoft solutions partner, nSynergy with offices in Australia, China,

USA and UK; Investing a 12.5% stake in Microsoft SharePoint partner, LiveTiles; Opening a new office and launching our Private Cloud licensing business in Indonesia; Successfully launching a worldwide pilot Licensing Solutions Provider (LSP) program in Australia

with over 200% achievement of Microsoft’s deal target; Appointment by Microsoft as a Public cloud wholesaler under its 2-Tier Cloud Solutions Provider

Program (CSP) in Australia, launching July 1, 2016; Short-listed and subsequently appointed (FY16) by Microsoft as a Public Cloud wholesaler under

2-Tier CSP in Singapore, Malaysia, Thailand, Indonesia and the Philippines; Short-listed and subsequently appointed (FY16) by SoftLayer, an IBM Company, as a wholesaler

of its public cloud infrastructure in Australia and up to 8 countries in Asia; Launching new vendor programs from Skykick, Zimbra and LiveTiles; Launching rhipe’s new channel solutions offering to help service providers with implementation

services and support, and; rhipe was named Software Distributor of the Year 2015 at the ARN ICT Industry Awards in

September 2015.

These achievements have been made possible due to a highly motivated team of professionals who live and breathe our company values of Innovation, Motivation, Performance, Accountability, Candour and Teamwork (IMPACT). Looking ahead to 2016 I am excited by the sheer scale and breadth of innovation and change that is coming to our industry. Due to the size and inter-connectedness of the public cloud, we are now entering an age of co-opetition in which vendors are starting to work together, partners and customers are becoming vendors with their own products and rhipe is positioned well as a distribution hub with highly engaged cloud licensing, cloud solutions and cloud operations teams. If 2015 was the year in which we won the right to play in the Public Cloud economy, 2016 will be the year in which we execute and build out the business of the future. On behalf of the Board and the Executive team, we thank our staff, vendors, partners and shareholders for their belief and commitment to our vision.

Dominic O’Hanlon Managing Director

1 IDC #251730, Microsoft WPC 2015 Keynote

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Operating and Financial Review

RHIPE LIMITED (FORMERLY RHYPE LIMITED) ABN: 91 112 452 436 Principal Activities and Significant Changes in Nature of Activities The principal activities of the consolidated Group during the financial year were the sale of subscription licensing and aggregation of subscription licensing models from many of the world’s leading software vendors such as Microsoft and VMware. In addition, the Group assists its service provider customers transition to cloud and subscription centric business environments. Operating Results and Review of Operations for the Year The results presented in this financial report reflect the operations of rhipe Limited and all subsidiaries from 1 July 2014 to 30 June 2015 (together the “Group”). For the full year ended 30 June 2015, Group revenue was $108.8m, up 46% compared to the prior year comparative period. Group earnings prior to growth investments, non-cash share based payments, non-recurring due diligence costs and non-recurring one off costs was $4.9m, up 47% on a like-for-like basis compared to the prior year comparative period. Licensing revenue was $105.1m, up 41% and license gross margin was $16.45m, up 37% compared to the prior year comparative period. The licensing gross margin % for the financial year to 30 June 2015 was 15.66%. Group gross margin was $20.1m for the financial year, up 67% on the prior comparative period. Financial Summary ($’000) FY15 FY14 Change

Licensing Revenue (Annuity Subscription) (3)

105,052 74,548 + 41%

Services Revenue 3,717 - n/a

Total Revenue 108,769 74,548 + 46% Gross Margin Licensing Gross Margin Services

16,452

3,631

11,991

-

+ 37%

n/a

Total Gross Margin Underlying EBITDA pre growth investment & non-cash and non-recurring (1)

20,083

4,896

11,991

3,332

+ 67%

+ 47%

Underlying EBITDA pre non-cash and non-recurring(2)

1,222 1,832 - 33%

(Loss)/Profit before Income Tax (1,535) 1,370 n/a

(1) Underlying EBITDA pre Growth excludes Net Investment in SEA and Cloud LSP after local gross margin contributions, CSP

teams and Group Support Costs.

(2) Underlying EBITDA excludes non-cash expenses relating to share based payments for executive options issued and non-

recurring expenses such as transaction costs associated with nSynergy acquisition (Dec14), executive team recruitment and

impairment write down for assets held for re-sale.

(3) Licensing revenue excludes approximately $2.5m revenue received for prepaid licensing sales on 29 June 2015 which will

be recognised in FY16.

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OPERATING AND FINANCIAL REVIEW CONTINUED

During the 12-month period to 30 June 2015, rhipe invested heavily in the transition of its operations from a purely private-cloud licensing business to a “Whole of Cloud” wholesaler with integrated divisions focused on cloud licensing (private, public and hybrid), cloud solutions (services and support), and cloud operations (billing, provisioning, marketing). Rhipe’s investment in these operating divisions led to a number of significant achievements that have set the foundation for rhipe’s ongoing growth. In December 2014, rhipe completed the strategic acquisition of nSynergy to form the new rhipe Solutions business unit. This acquisition paved the way for rhipe’s bid to represent Microsoft as a wholesaler of Microsoft’s public cloud offerings. In April 2015 rhipe was awarded the Microsoft 2-Tier Cloud Solutions Program (CSP) for Australia. This program allows rhipe to wholesale Microsoft’s public cloud offerings such as Office365, Azure and Enterprise Mobility Suite (EMS) to rhipe’s reseller channel on a monthly subscription “pay-as-you-use” basis. From December 2014 to June 2015, rhipe also engaged with Microsoft in 5 South East Asian countries in relation to their 2-Tier CSP wholesaler program. In July 2015 rhipe was subsequently awarded the 2-Tier CSP program in each of these countries. As part of the acquisition of nSynergy, rhipe also made an investment in cloud software company, LiveTiles. This investment provided rhipe with exclusive rights to distribute the LiveTiles product to service providers in Asia Pacific. During the financial year rhipe worked closely with SoftLayer, an IBM company, to explore how rhipe could wholesale the SoftLayer infrastructure to rhipe’s reseller channel in all seven of rhipe’s operating countries. Rhipe was subsequently awarded the Cloud-wholesaler vendor agreement for Softlayer in APAC for Q1/ FY16 implementation. Rhipe signed new licensing relationships with Intel Security (McAfee), Zimbra, LiveTiles and SkyKick. Rhipe built a dedicated Cloud Licensing Solutions Provider (LSP) team as a result of signing a new pilot cloud licensing program with Microsoft Australia (the Cloud LSP program) and achieved 200% attainment of targets. The company opened an office in Indonesia following signing a new SPLA licensing agreement with Microsoft in August of 2014, and over the year, rhipe greatly expanded its executive team with a new Chief Executive Officer, Chief Financial Officer, Chief Commercial Officer, Chief Marketing Officer, Chief Technology Officer and Chief Strategy Officer. Rhipe’s key software vendor relationships include those with Microsoft, VMWare, Citrix, Datacore, Intel Security (McAfee), Red Hat, Trend Micro, Veeam, Zimbra, LiveTiles and SkyKick. Rhipe sells and manages subscription software to over 1600 Channel customers including Managed Service Providers (MSPs), Independent Software Vendors (ISVs) and System Integrators (SIs). Rhipe also supports these channel customers with value-add services including business transformation consulting, marketing and lead generation, order processing and license optimisation and compliance consulting. Rhipe’s services and support offerings (resulting from the acquisition of nSynergy) are currently focused on Microsoft technologies such as Office365 and Azure. The nSynergy business was integrated into rhipe over a 6 month period and rebranded to “rhipe solutions” in June, 2015. The business generated revenue of $3.72m and EBIT $0.23m for the period to June 2015. Rhipe’s growth continues to come from its heritage geographies of Australia and New Zealand with even higher growth from rhipe’s investment in South East Asia.

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The table below outlines the underlying EBITDA contribution from the Group for the year ending June 30, 2015:

$’000 Underlying EBITDA pre growth investment and non-cash and non-recurring (1)

4,896

Growth Investment expensed: Investment in South East Asia (2,459) Investment in Cloud Solutions Provider (CSP)Program (610) Investment in Cloud LSP Team (484) Investment in Group Support Costs (121) Underlying EBITDA pre non-cash and non-recurring costs (2)

Non-cash and Non-recurring expenses:

1,222

Non-recurring transaction costs and integration costs expensed (478) Non-cash share based payments expensed in accordance with accounting standards

(1,787)

Non-recurring impairment write-down for assets held for re-sale (157) Non-recurring recruitment costs expensed for CEO (153) EBITDA Reported

(1,353)

Depreciation and amortisation

(Loss)/Profit before Income Tax

(182)

(1,535)

The table below extracts cash flow generated by operating activities before growth investment and non-recurring costs, payment of income tax and interest received. Adjusted cash generated from operations is $1.0m:

$’000 Calculation of Cash Flows (used in) / provided by Operating Activities adjusted for Growth Investment and Non-recurring Costs:

Net cash (used in)/provided by operating activities per Consolidated Statement of Cash Flows:

(5,167)

Growth Investment expensed:

South East Asia 2,459 Cloud Solution Provider (CSP) Program 610 Cloud LSP Team 484 Group Support Costs 121

Non-recurring expenses: Transaction costs and integration costs 478 Recruitment costs expensed for CEO

153

Net cash (used in)/provided by operating activities pre Growth and Non-recurring Costs:

(862)

Increase in cash employed in growth in debtors (net of increase in creditors):

1,243

being the audited change in net debtors/creditors 1/7/14 to 30/6/15:

2,341

less payment in July 2014 of June 2014 vendor payments (1,098)

Payment of income tax: 768 Interest received: (103)

Cash flow from operations before Growth and Non-recurring costs, net increase in debtors, tax and interest:

1,046

The directors believe that the Group is in a strong and stable financial position to continue to expand and grow the business. The Group currently has approximately $12.4m in cash (and cash equivalents) at bank (2014: $4.5m).

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Significant Changes in State of Affairs The following significant changes in the state of affairs of the Group occurred during the financial year:

i. Rhipe Limited (formerly Rhype Limited) acquired all the issued shares in nSynergy OSC Holdings Pty Ltd on 15 December 2014;

ii. nSynergy OSC Holdings Pty Ltd is a holding company and owns 100% of nSynergy OSC Pty Ltd, Online SC LLS and nSynergy Shanghai; and

iii. PT NewLease International Indonesia was incorporated on 23 July 2014. Events after the Reporting Period Subsequent to the end of the reporting period, the purchase price of nSynergy, post finalising completion accounts and agreement with the vendors, was reduced from the headline figure of $25.35m (as announced on 28th November) to $14.35m, which comprises:

$10m cash paid at completion in December 2014 $4.35m stock in rhipe issued, escrowed to December 2015.

The reduction of $11m from that consideration announced on 28th November 2014 comprises: $3m of cash which has been retained by rhipe to meet working capital requirements, and $8m of potential earn out for 2016 and 2017 which will be replaced by standard rhipe bonus plans for

senior team members. Rhipe acquired a 12.5% shareholding in LiveTiles Holdings Pty Ltd in December 2015 for cash consideration of $2.5m, at the same time as acquiring the nSynergy business. All the shareholders of LiveTiles Holdings Pty Ltd have since exchanged their shares for shares in ASX listed entity Modun Resources Ltd (ASX code: MOU) in a reverse take-over transaction. MOU has changed its name to LiveTiles Limited (ASX code: LVT) and the ASX entity will now own and conduct the LiveTiles business. MOU also raised $12m of new capital (before costs) in July 2015 at a share price of $0.15. Rhipe now holds 24,469,224 shares in LVT (6.52% of ordinary shares on issue) with a value of $3.67m based on the capital raising share price of $0.15. LVT listed in the ASX on the 18th September 2015. Future Developments, Prospects and Business Strategies The Group has strong existing relationships with a number of key software and technological partners and the Group will look to continue to build and nurture these relationships. The Group will also continue to explore opportunities to further expand its reach from its current bases in Australia, New Zealand, Singapore, Hong Kong, Thailand, Malaysia, Philippines, Indonesia, China and the United States. In addition to the continued operation and expansion of the rhipe and nSynergy business, the Company will continue to assess further acquisition opportunities that will complement and create synergies with the Company’s existing business model. Environmental Issues The consolidated group’s operations are not regulated by any significant regulations under a law of the Commonwealth or of a state or territory.

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Directors’ Report

RHIPE LIMITED (FORMERLY RHYPE LIMITED) ABN: 91 112 452 436 AND CONTROLLED ENTITIES Your directors present their report on the consolidated entity (referred to herein as the Group) consisting of RHIPE LIMITED (FORMERLY RHYPE LIMITED) and its controlled entities for the financial year ended 30 June 2015. The information in the preceding Operating and Financial Review forms part of this Director’s Report for the financial year ended 30 June 2015 and is to be read in conjunction with the following information.

General Information Directors The following persons were directors of rhipe Limited (formerly Rhype Limited) during or since the end of the financial year up to the date of this report:

Mike Hill Dominic O’Hanlon (appointed 15 June 2015) Dawn Edmonds Laurence Sellers Mark Pierce Michael Everett Philip Kapp (resigned 02 September 2014)

Particulars of each Director’s experience and qualifications are set out below. Information relating to Directors and Company Secretary

Mike Hill Experience and Qualifications

— —

Executive Chairperson – Appointed 10 April 2014 Mr Hill is a former Partner of Ernst & Young and has worked with

the Ironbridge Capital investment team since 2004 and took on the role of Operational Partner for the firm in 2012. Ironbridge Capital is a leading domestic private equity firm with $1.5bn of funds under management.

Interest in Shares and Options — 404,290 ordinary shares and 2,125,000 options

Special Responsibilities — Chairperson, Remuneration Committee (Chair) and Audit Committee

Directorships held in other listed entities during the three years prior to the current year

— AHAlife Holdings Limited (Non-Executive Chairman) HJB Corporation Limited (Executive Chairman) LiveTiles Limited (Executive Chairman) JustKapital Litigation Partners Limited (Executive Director) Prime Media Group Limited (Non-Executive Director)

Dominic O’Hanlon

— Managing Director – Appointed 15 June 2015 was Chief Executive Officer from 5 August 2014 until appointment as Managing Director on June 2015.

Experience and Qualifications — Mr O’Hanlon is a well-known and successful technology entrepreneur who has nearly 25 years’ experience in software development, marketing, sales, implementation and support. Dominic has served in prior roles as CEO, Chief Strategy Officer, Non-Executive Director and Chairman for numerous high growth technology companies.

Interest in Shares and Options — 3,316,428 ordinary shares, 1,000,000 performance rights and 600,000 options

Special Responsibilities — None


— None

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DIRECTORS’ REPORT CONTINUED

Laurence Sellers — Non-Executive Director – Appointed 10 April 2014

Experience and Qualifications — Mr Sellers is a Non-Executive Director of rhipe, having joined NewLease in 2013. Laurence (Laurie) is a 39 year veteran in the Australian IT Industry and during the last 20 years served as the Chief Executive Officer of ALSTOM Information Technology, Managing Director of ITX Group Limited, Vice President of Avnet Technology Solutions ANZ, and most recently, Co-Founder and Chairman of PushPull Marketing Pty Limited.

Interest in Shares and Options — Nil ordinary shares and 1,400,000 options

Special Responsibilities — Risk Committee and Remuneration Committee


— None

Mark Pierce — Non-Executive Director – Appointed 10 April 2014

Experience and Qualifications — Mr Pierce has over 25 years’ corporate finance and underwriting experience gained from senior positions held at Credit Suisse, Rabobank, Macquarie Bank and Westpac. Since 2009, Mr Pierce has independently provided financial advisory and arranging services to a number of clients, including managing the treasury and funding for a large operating lease company in Australia and New Zealand.

. Interest in Shares and Options — 20,000 ordinary shares and 500,000 options

Special Responsibilities — Audit Committee (Chair) and Risk Committee (Chair)

Dawn Edmonds — Executive Director and Chief Operating Officer – Appointed 10 April 2014. Ceased Interim Chief Executive Officer on 5 August 2014 upon appointment of Dominic O’Hanlon

Experience and Qualifications — Ms Edmonds is one of the founders and the Chief Operating Officer and Executive Director of rhipe. With a strong understanding of the IT industry, Dawn has played an integral part in establishing the company and its continuing success.

Responsible for the management of systems, people and performance as well as the day-to-day operations of the organisation Dawn has led the development and implementation of process and systems that have been recognised as best practice by vendors. Prior to starting NewLease in 2003, she was instrumental in building a successful start-up business in the temporary labour hire and IT outsourcing sectors.

Dawn was recognised by Smart Company as one of Australia’s top 40 female entrepreneurs for 2011, and in 2012 was awarded the ARN Women in ICT Entrepreneur Award. She is also a member of the Australian Institute of Management as well as the Australian Institute of Company Directors.

Interest in Shares and Options — 3,752,294 ordinary shares and 550,000 options

Special Responsibilities — Chief Operating Officer, Risk Committee and Remuneration Committee


— None

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—

None

Michael Everett

— Non-Executive Director – Appointed 10 April 2014

Experience and Qualifications — Mr Everett has more than 25 years of capital markets and advisory experience. Michael retired from Goldman Sachs in 2013 after 11 years where he was a Managing Director and Co-head of the Financing Group within the Investment Banking Division in Australia. Prior to joining Goldman Sachs, he also worked internationally for a large investment bank and has broad experience across the securities industry. During his career, he has advised a broad range of companies in a variety of industries. In late 2013, he established an independent capital markets advisory firm, Reunion Capital Partners.

Interest in Shares and Options — 631,579 ordinary shares and 750,000 options

Special Responsibilities — Audit Committee and Remuneration Committee


— AHAlife Holdings Limited (non-executive)

HJB Corporation Limited (non-executive)

Philip Kapp Experience and Qualifications

— —

Non-Executive Director - Resigned 2 September 2014 Mr Kapp is a Senior Partner of Corrs Chambers Westgarth Lawyers. He has over 25 years’ experience in mergers and acquisitions, capital raising and private equity. He is widely regarded as one of Australia’s leading corporate lawyers. Philip also sits on the board of Energy Developments Limited, an ASX-listed company, as a Non-Executive Director.

Interest in Shares and Options

— 189,474 ordinary shares and 500,000 options - upon resignation


— JustKapital Litigation Partners Limited (Executive Chairman)

Energy Developments Limited

Company Secretary

The following person held the position of company secretary at the end of the financial year: Mr Andrew Whitten - Company Secretary Andrew is an admitted solicitor with a specialty in Corporate Finance and Securities Law and is a Solicitor Director of Whittens & McKeough Pty Ltd. Andrew is currently the company secretary of a number of publicly listed companies. He has been involved in a number of corporate and investment transactions including IPOs on the ASX and NSX, corporate reconstructions, reverse mergers and takeovers.

Andrew holds a Bachelor of Arts (Economics, UNSW); Master of Laws and Legal Practice (Corporate Finance and Securities Law, UTS); Graduate Diploma in Applied Corporate Governance from the Governance Institute and is an elected Associate of that institute. Andrew is also a Public Notary.

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Meetings of Directors During the financial year, 11 meetings of directors were held. The audit committee, the remuneration committee and the risk committee met during the reporting period. Attendances by each director during the year were as follows: DIRECTORS’ MEETINGS AUDIT COMMITTEE REMUNERATION COMMITTEE RISK COMMITTEE NUMBER

ELIGIBLE TO

ATTEND

NUMBER

ATTENDED NUMBER

ELIGIBLE TO

ATTEND

NUMBER

ATTENDED NUMBER

ELIGIBLE TO

ATTEND

NUMBER

ATTENDED NUMBER

ELIGIBLE TO

ATTEND

NUMBER

ATTENDED

Mike Hill 11 11 4 2 1 1 n/a n/a Dominic O’Hanlon 1 1 n/a n/a n/a n/a n/a n/a Dawn Edmonds 11 11 n/a n/a 1 1 2 2 Laurence Sellers 11 11 n/a n/a 1 1 1 1 Mark Pierce 11 11 4 4 n/a n/a 2 2 Michael Everett 11 10 2 2 1 1 n/a n/a Philip Kapp 2 1 n/a n/a n/a n/a n/a n/a Dividends Paid or Recommended

No dividends have been paid or declared by rhipe Limited since the beginning of the financial year and none are recommended.

Indemnifying Officers or Auditor

During or since the end of the financial year, the company has given an indemnity or entered into an agreement to indemnify or paid or agreed to pay insurance premiums as follows:

– The company has paid premiums to insure each of the directors against liabilities for costs and expenses incurred by them in defending legal proceedings arising from their conduct while acting in the capacity of directors of the company, other than conduct involving a wilful breach of duty in relation to the company. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.

– No indemnity has been provided for the auditors Proceedings on Behalf of Company

No person has applied for leave of Court to bring proceedings on behalf of the company or intervene in any proceedings to which the company is a party for the purpose of taking responsibility on behalf of the company for all or any part of those proceedings.

The company was not a party to any such proceedings during the year. Non-audit Services

The Board of Directors, in accordance with advice from the audit committee, is satisfied that the provision of non-audit services during the year is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the services disclosed below did not compromise the external auditor’s independence for the following reasons:

– All non-audit services are reviewed and approved by the audit committee prior to commencement to ensure they do not adversely affect the integrity and objectivity of the auditor; and

– The nature of the services provided does not compromise the general principles relating to auditor independence in accordance with APES 110: Code of Ethics for Professional Accountants set by the Accounting Professional and Ethical Standards Board.

The following fees were paid or payable to ShineWing Australia for non-audit services provided during the year ended 30 June 2015: $

Taxation services 50,000

50,000

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Options

As at the date of signing this report, there were 8,397,500 unissued ordinary shares under option (30 June 2014: 9,499,672). These options are exercisable as follows:

DETAILS NUMBER OF OPTIONS DATE OF EXPIRY CONVERSION PRICE ($)

Management incentive options issued prior to 1,187,500 12/03/2016 0.20 completion of reverse takeover by NewLease Pty Ltd 1,437,500 12/03/2018 0.20 Management incentive options 2,125,000 10/04/2017 0.20 2,125,000 10/04/2019 0.20 300,000 11/08/2018 0.75 300,000 11/08/2020 0.75 67,500 15/09/2018 0.75 67,500 15/09/2021 0.75 67,500 01/10/2018 0.75 67,500 01/10/2021 0.75 200,000 01/07/2018 0.75 200,000 01/07/2021 0.75 126,250 18/03/2017 1.25 126,250 18/03/2018 1.25 8,397,500 Auditor’s Independence Declaration

The lead auditor’s independence declaration for the year ended 30 June 2015 has been received and can be found on page 30 of the Financial Report. ASIC Class Order 98/100 Rounding of Amounts

The company is an entity to which ASIC Class Order 98/100 applies and, accordingly, amounts in the financial statements and directors’ report have been rounded to the nearest thousand dollars.

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Remuneration Report

RHIPE LIMITED (FORMERLY RHYPE LIMITED) ABN: 91 112 452 436 AND CONTROLLED ENTITIES Remuneration policy

The remuneration policy of rhipe Limited (formerly Rhype Limited) has been designed to align key management personnel (KMP) objectives with shareholder and business objectives by providing a fixed remuneration component and offering specific long-term incentives based on key performance areas affecting the consolidated group’s financial results. The board of rhipe Limited (formerly Rhype Limited) believes the remuneration policy to be appropriate and effective in its ability to attract and retain the high-quality KMP to run and manage the consolidated group, as well as create goal congruence between directors, executives and shareholders. The Board’s policy for determining the nature and amount of remuneration for KMP of the consolidated group is as follows:

o The remuneration policy is developed by the remuneration committee and approved by the Board after professional advice is sought from independent external consultants.

o All KMP receive a base salary (which is based on factors such as length of service and experience), superannuation, fringe benefits, options and performance incentives.

o Performance incentives are generally only paid once predetermined key performance indicators (KPIs) have been met.

o Incentives paid in the form of options or rights are intended to align the interests of the directors and company with those of the shareholders. In this regard, KMP are prohibited from limiting risk attached to those instruments by use of derivatives or other means.

o The remuneration committee reviews KMP packages annually by reference to the consolidated group’s performance, executive performance and comparable information from industry sectors.

The performance of KMP is measured against criteria agreed annually with each executive and is based predominantly on the forecast growth of the consolidated group’s profits and shareholders’ value. All bonuses and incentives must be linked to predetermined performance criteria. The Board may, however, exercise its discretion in relation to approving incentives, bonuses and options, and can recommend changes to the committee’s recommendations. Any change must be justified by reference to measurable performance criteria. The policy is designed to attract the highest calibre of executives and reward them for performance results leading to long-term growth in shareholder wealth. KMP receive, at a minimum, a superannuation guarantee contribution required by the government, which is currently 9.5% (from 1 July 2014) of the individual’s average weekly ordinary time earnings (AWOTE). Individuals can choose to sacrifice part of their salary to increase payments towards superannuation. Upon retirement, KMP are paid employee benefit entitlements accrued to the date of retirement. Any vested options at retirement must be exercised within three months of retirement or they will lapse. All other options granted to the retiring participant not exercised before or on the date of termination will lapse. All remuneration paid to KMP is valued at the cost to the company and expensed. The Board’s policy is to remunerate non-executive directors at market rates for time, commitment and responsibilities. The remuneration committee determines payments to the non-executive directors and reviews their remuneration annually, based on market practice, duties and accountability. Independent external advice is sought when required. The maximum aggregate amount of fees that can be paid to non-executive directors is subject to approval by shareholders at the Annual General Meeting. KMP are also entitled and encouraged to participate in the employee share and option arrangements to align directors’ interests with shareholders’ interests.

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REMUNERATION CONTINUED Options granted under the arrangement do not carry dividend or voting rights. Each option is entitled to be converted into one ordinary share once the interim or final financial report has been disclosed to the public and is measured using the Black- Scholes methodology or equivalent. KMP or closely related parties of KMP are prohibited from entering into hedge arrangements that would have the effect of limiting the risk exposure relating to their remuneration.

Performance-based Remuneration

The KPIs are set annually, with a certain level of consultation with KMP. The measures are specifically tailored to the area each individual is involved in and has a level of control over. The KPIs target areas the Board believes hold greater potential for group expansion and profit, covering financial and non-financial as well as short and long-term goals. The level set for each KPI is based on budgeted figures for the Group and respective industry standards.

Performance in relation to the KPIs is assessed annually, with bonuses being awarded depending on the number and deemed difficulty of the KPIs achieved. Following the assessment, the KPIs are reviewed by the remuneration committee in light of the desired and actual outcomes, and their efficiency is assessed in relation to the Group’s goals and shareholder wealth, before the KPIs are set for the following year. In determining whether or not a KPI has been achieved, rhipe Limited (formerly Rhype Limited) bases the assessment on audited figures. Relationship between Remuneration Policy and Company Performance

The remuneration policy has been tailored to increase goal congruence between shareholders, directors and executives. Two methods have been applied to achieve this aim, the first being a performance-based bonus based on KPI, and the second being the issue of options to the majority of directors and executives to encourage the alignment of personal and shareholder interests. The company believes this policy will be effective in increasing shareholder wealth.

Performance Conditions Linked to Remuneration

The Group seeks to emphasise reward incentives for results and continued commitment to the Group through the provision of various cash bonus reward schemes, specifically the incorporation of incentive payments based on the achievement of revenue targets, gross profit margins, and continued employment with the Group. The performance related proportions of remuneration based on these targets are included in the following table. The objective of the reward schemes is to both reinforce the short and long- term goals of the Group and provide a common interest between management and shareholders. There has been no alteration to the terms of the bonuses paid since grant date.

Employment Details of Members of Key Management Personnel

The following table provides employment details of persons who were, during the financial year, members of KMP of the consolidated group. The table also illustrates the proportion of remuneration that was performance and non-performance based and the proportion of remuneration received in the form of options.

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REMUNERATION CONTINUED

POSITION HELD AS AT 30 JUNE 2015 AND ANY CHANGE DURING THE YEAR

CONTRACT DETAILS (DURATION & TERMINATION)

Group KMP

Mike Hill Chairman and Executive Director Executive Services agreement – If terminated by company without reason - three months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - three months’ notice If company breaches the agreement, the notice period from executive can be 28 days Dominic O’Hanlon Managing Director (appointed 15 June

2015). CEO (appointed 5 August 2014) Executive Services agreement - If terminated by company without reason - six months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - six months’ notice If company breaches the agreement, the notice period from executive can be 28 days

Dawn Edmonds COO and Executive Director (ceased being Interim CEO on 5 August 2014)

Executive Services agreement – If terminated by company without reason - twelve months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - three months’ notice If company breaches the agreement, the notice period from executive can be 28 days

Laurence Sellers Non-Executive Director Executive Services agreement –

If terminated by company without reason - three months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - three months’ notice If company breaches the agreement, the notice period from executive can be 28 days

Mark Pierce Non-Executive Director Executive Services agreement – If terminated by company without reason - three months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - three months’ notice If company breaches the agreement, the notice period from executive can be 28 days

Michael Everett Non-Executive Director Executive Services agreement - If terminated by company without reason - three months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - three months’ notice If company breaches the agreement, the notice period from executive can be 28 days

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Philip Kapp Non-Executive Director (resigned 2 September 2014)

Executive Services agreement – If terminated by company without reason - three months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - three months’ notice If company breaches the agreement, the notice period from executive can be 28 days

Other Executives

Ravi Samuel CFO (appointed 15 September 2014)

Executive Services Agreement - If terminated by company without reason - three months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - three months’ notice If company breaches the agreement, the notice period from executive can be 28 days

Warren Nolan CCO Executive Services Agreement - If terminated by company without reason - three months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - three months’ notice If company breaches the agreement, the notice period from executive can be 28 days

Athena Thompson CMO

Standard nSynergy employment agreement - With under one year of service, employer only needs to provide one week notice when terminating the employee. 1-3 years is 2 weeks’ notice. If terminated by employee, four weeks’ notice required.

Chris Sharp VP Strategy Standard rhipe Employment agreement - One month notice required if terminated by company or by employee.

Mark Carroll CFO and Joint Company Secretary (resigned 18 August 2014)

Executive Services agreement – If terminated by company without reason - three months’ notice If terminated by company with reason - one months’ notice; If terminated by executive - three months’ notice If company breaches the agreement, the notice period from executive can be 28 days

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PROPORTIONS OF ELEMENTS OF

REMUNERATION RELATED TO

PERFORMANCE

PROPORTIONS OF ELEMENTS OF

REMUNERATION NOT RELATED TO

PERFORMANCE

NON-SALARY CASH INCENTIVES %

SHARES/UNITS % OPTIONS/BASED RIGHTS %

FIXED SALARY/FEES % TOTAL %

Group KMP

Mike Hill 18.4% - -

81.6% 100.0%

Dominic O’Hanlon 27.0% - 31.0% 42.0% 100.0% Dawn Edmonds 17.3% - 24.1% 58.6% 100.0% Laurence Sellers - - 86.9% 13.1% 100.0% Mark Pierce - - 70.2% 29.8% 100.0% Michael Everett - - 70.8% 29.2% 100.0% Philip Kapp - - - 100.0% 100.0% Other Executives Ravi Samuel 29.0% - 13.3% 57.7% 100.0% Mark Carroll 24.7% - - 75.3% 100.0% Warren Nolan 35.9% - 26.1% 38.0% 100.0% Athena Thompson 28.7% - 2.0% 69.3% 100.0% Chris Sharp 16.3% - 29.4% 54.3% 100.0%

The employment terms and conditions of all KMP are formalised in contracts of employment.

A contracted person deemed employed on a permanent basis may terminate their employment by providing at least one months’ notice. Termination payments are not payable on resignation or under the circumstances of unsatisfactory performance. Note A: Non-executive directors are subject to similar contractual arrangements whereby at least three months’ notice is required to be given on termination. Termination payments are at the discretion of the remuneration committee.

Changes in Directors and Executives Subsequent to Year-end There have not been any changes to Directors and Executives subsequent to year-end

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Remuneration Expense Details for the Year Ended 30 June 2015

The following table of benefits and payments represents the components of the current year and comparative year remuneration expenses for each member of KMP of the consolidated group. Such amounts have been calculated in accordance with Australian Accounting Standards: Table of Benefits and Payments for the year ended 30 June 2015

SHORT-TERM

BENEFITS

POST EMPLOYMENT

BENEFITS

EQUITY-SETTLED SHARE-BASED

PAYMENTS

SALARY, FEES AND LEAVE

$

PROFIT SHARE AND BONUSES

$

OTHER

$

PENSION AND SUPERANNUATION

$

OPTIONS/ RIGHTS

$

TERMINATION BENEFITS

$

TOTAL

$

2015 Directors

Mike Hill 182,648 45,000 - 17,352 - - 245,000 Dominic O’Hanlon 382,499 258,750 - 18,783 296,704 - 956,736

Dawn Edmonds 336,883 112,500 6,366 36,404 156,474 - 648,627

Laurence Sellers 55,046 - - 5,229 398,296 - 458,571

Mark Pierce 55,046 - - 5,229 142,249 - 202,524

Michael Everett 58,667 - - - 142,249 - 200,916

Philip Kapp 10,333 - - - - - 10,333

Total Directors 1,081,122 416,250 6,366 82,997 1,135,972 - 2,722,707

Other Executives

Ravi Samuel 172,273 93,750 - 14,388 42,851 - 323,262

Mark Carroll 44,272 15,981 - 4,531 - - 64,784

Warren Nolan 230,733 256,563 14,452 27,088 186,767 - 715,603

Athena Thompson 82,603 37,500 - 7,847 2,625 - 130,575

Chris Sharp 271,529 85,368 - 13,469 154,149 - 524,515

Total Executives 801,410 489,162 14,452 67,323 386,392 - 1,758,739

Grand Totals 1,882,532 905,412 20,818 150,320 1,522,364 - 4,481,446

SHORT-TERM

BENEFITS

POST EMPLOYMENT

BENEFITS

EQUITY-SETTLED SHARE-BASED

PAYMENTS

SALARY, FEES AND LEAVE

$

PROFIT SHARE AND BONUSES

$

OTHER

$

PENSION AND

SUPERANNUATION

$

OPTIONS/ RIGHTS

$

TERMINATION BENEFITS

$

TOTAL

$

2014 Group KMP

Mike Hill 233,336 50,000 - 17,775 151,409 - 452,520 Dawn Edmonds* 95,971 35,000 1,224 9,343 33,519 - 175,057

Laurence Sellers 10,586 - - 979 85,320 - 96,885

Mark Pierce 10,586 - - 979 30,472 - 42,037

Michael Everett 13,667 - - - 33,624 - 47,291

Philip Kapp 36,833 10,000 - - 35,626 - 82,459

Leigh Curyer 95,147 10,000 - 12,964 80,158 35,000 233,269

Jonathan Pager 23,167 20,000 - - - 7,500 50,667

Total KMP 519,293 125,000 1,224 42,040 450,128 42,500 1,180,185

Other Executives

Mark Carroll

42,246

13,146

-

5,124

-

-

60,516

*Dawn Edmonds’ remuneration for the 30th June 2014 year is from the date of the reverse acquisition of rhipe by FRR.

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Securities Received that are not Performance Related

No members of KMP are entitled to receive securities that are not performance-based as part of their remuneration package.

Bonuses

GRANT DATE MINIMUM POSSIBLE BONUS

MAXIMUM POSSIBLE BONUS

BONUS PAID/PAYABLE

PERCENTAGE OF BONUS PAID

PERCENTAGE OF BONUS FORFEITED

2015 Group KMP $ $ $ % %

Mike Hill Mar 2015 - 50,000 45,000 90% 10% Dominic O’Hanlon Mar 2015 - 270,000 258,750 96% 4% Dawn Edmonds Mar 2015 - 120,000 112,500 94% 6% Ravi Samuel Mar 2015 - 100,000 93,750 94% 6% Mark Carroll Aug 2014 - 15,981 15,981 100% Nil Chris Sharp Mar 2015 - 91,420 85,368 93% 7% Warren Nolan Mar 2015 - 275,000 256,563 93% 7% Athena Thompson Mar 2015 - 40,000 37,500 94% 6%

KPI achievement bonuses are linked to financial and strategic targets including revenue, gross margin, underlying EBITDA, signing of new vendor programs and acquisition of businesses. Bonuses are only paid out if the Company has positive underlying EBITDA excluding non-cash and non-recurring expenses as disclosed to the ASX. If this underlying EBITDA reaches $0 before or after paying any amount of the bonuses in the Company plan, no further amounts will be paid. In the event that there is sufficient underlying EBITDA to pay some, but not all bonus amounts, the CEO, remuneration committee and Board will have discretion over the allocation of partial bonuses to individuals.

Share-based Payments

The terms and conditions relating to share based payments granted as remuneration during the year to KMP are as follows:

2015 Group KMP

REMUNERATION TYPE

GRANT DATE

GRANT VALUE

$

REASON FOR

GRANT

PERCENTAGE VESTED/PAID DURING YEAR

%

PERCENTAGE FORFEITED

DURING YEAR %

PERCENTAGE REMAINING

AS UNVESTED %

EXPIRY DATE FOR VESTING OR PAYMENT

Dominic O’Hanlon Options Jul 2014 94,830 1(a) Nil n/a 100 1(a)

Dominic O’Hanlon Performance rights

Jul 2014 328,000 1(b) n/a n/a n/a 1(b)

Dominic O’Hanlon Shares via loan Jul 2014 403,440 1(c) Nil n/a 100 1(c)

Ravi Samuel Options Feb 2015 106,751 1(d) Nil n/a 100 1(a)

Chris Sharp Options Feb 2015 106,960 1(d) Nil n/a 100 1(a)

Warren Nolan Options Feb 2015 312,940 1(d) Nil n/a 100 1(a)

Athena Thompson Options Mar 2015 22,841 1(d) Nil n/a 100 1(d) Note 1(a) Management incentive plan whereby half options vest after the Company’s share price has traded at $1.00 or above for 20 business days (using 20 day VWAP) and one year service, and the balance once the Company’s share price has traded $1.20 or above for 20 business days (using 20 day VWAP) and two years’ service. If options vest, expire three and five years from vesting date.

Note 1(b) Management incentive plan whereby shares vest after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP), with half requiring three years’ service and half requiring five years’ service.

Note 1(c) Management incentive plan whereby shares vest after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP), and in three equal tranches over the escrow periods of 18, 36 & 54 months.

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Note 1(d) Management incentive plan whereby options were issued in two equal tranches with half vesting with two years’ service and after the Company’s share price has traded at $1.50 or above for 20 business days (using 20 day VWAP).and the balance vesting with three years’ service and after the Company’s share price has traded at $1.75 or above for 20 business days (using 20 day VWAP). There have not been any alterations to the terms or conditions of any grants since grant date.

Options Granted during the Year to KMP

GROUP KMP

GRANT DATE

NO OPTIONS

EXPIRY DATE

EXERCISE PRICE

VALUE PER OPTION

(Note 1(a)(b)) (Note 1(c))

Dominic O’Hanlon 29 Jul 2014 300,000 11 Aug 2018 $0.75 $0.1545

Dominic O’Hanlon 29 Jul 2014 300,000 11 Aug 2021 2020

$0.75 $0.1616

Ravi Samuel 27 Feb 2015 67,500 15 Sept 2018 $0.75 $0.7321

Ravi Samuel 27 Feb 2015 67,500 15 Sept 2021 $0.75 $0.8494

Chris Sharp 27 Feb 2015 67,500 01 Oct 2018 $0.75 $0.7341

Chris Sharp 27 Feb 2015 67,500 01 Oct 2021 $0.75 $0.8505

Warren Nolan 27 Feb 2015 200,000 01 Jul 2018 $0.75 $0.7224

Warren Nolan 27 Feb 2015 200,000 01 Jul 2021 $0.75 $0.8423

Athena Thompson 18 Mar 2015 30,000 18 Mar 2017 $1.25 $0.4294

Athena Thompson 18 Mar 2015 30,000 18 Mar 2018 $1.25 $0.8786

Note 1(a) The options were issued by rhipe Limited Note 1(b) The recipients paid nil consideration Note 1(c) Option values at grant date were determined using Black-Scholes method

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Options and Rights Granted as Remuneration

BALANCE AT BEGINNING OF YEAR

GRANT DETAILS EXERCISED

No. Issue Date No.

Value $

(Note 1) (Note 2)

Value $

(Note 3)

Group KMP

Mike Hill 2,125,000 - - - - -

Dominic O’Hanlon - 29/07/2014 1,600,000 422,830 - -

Dawn Edmonds 550,000 - - - - -

Laurence Sellers 1,400,000 - - - - -

Mark Pierce 500,000 - - - - -

Michael Everett 750,000 - - - - -

Philip Kapp 500,000 - - - - -

Ravi Samuel - 27/02/2015 135,000 106,751 - -

Chris Sharp 400,000 27/02/2015 135,000 106,961 - -

Warren Nolan 27/02/2015 400,000 312,940 - -

Athena Thompson - 18/03/2015 60,000 22,841 - -

Mark Carroll - - - - - -

6,225,000 2,330,000 972,323 - -

LAPSED OTHER

CHANGES BALANCE AT

THE END OF THE YEAR

VESTED UNVESTED

No.

Value $

(Note 4) No.

(Note 5) No. Exercisable

No. Unexercisable

No. No. Group KMP

Mike Hill - - - 2,125,000 2,125,000 - - Dominic O’Hanlon - - - 1,600,000 - - 1,600,000 Dawn Edmonds - - - 550,000 229,167 - 320,833 Laurence Sellers - - - 1,400,000 583,333 - 816,667 Mark Pierce - - - 500,000 208,333 - 291,667 Michael Everett - - - 750,000 458,333 - 291,667 Philip Kapp - - (500,000) - - - - Ravi Samuel - - - 135,000 - - 135,000 Chris Sharp - - - 535,000 166,667 - 368,333 Warren Nolan - - - 400,000 - - 400,000 Athena Thompson - - - 60,000 - - 60,000 Mark Carroll - - - - - - -

- - (500,000) 8,055,000 3,770,833 - 4,284,167

Note 1 The fair value of options and rights granted as remuneration and as shown in the above table has been determined in accordance with Australian accounting standards and will be recognised as an expense over the relevant vesting period to the extent that conditions necessary for vesting are satisfied.

Note 2 All options and rights exercised resulted in the issue of ordinary shares in rhipe Limited (formerly Rhype Limited) on a 1:1 basis. All persons exercising options paid the applicable exercise price.

Note 3 The value of options and rights that have been exercised during the year as shown in the above table was determined as at the time of their exercise.

Note 4 The value of options and rights that have lapsed during the year due to vesting conditions not being satisfied has been determined at the time of their lapsing as if vesting conditions had been satisfied.

Note 5 This KMP resigned during the period. This represents the number of options held at resignation date.

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Performance Rights

On 29 July 2014, 1,000,000 performance rights were granted to Dominic O’Hanlon as part of the equity incentive plan approved at the annual general meeting on 28 November 2014. Half the performance rights vest after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP) and three years’ service. The balance vest after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP) and five years’ service.

The fair value of the performance rights has been determined using the following assumptions:

No. of performance rights 500,000 500,000

Grant date 29/07/2014 29/07/2014

Share price at grant date $0.82 $0.82

Vesting conditions (a) (b)

Risk-free interest rate 2.70% 2.98%

Value per option before discounting for market based vesting conditions 0.82 0.4039

Discount rate 50% 50%

Value per option after discounting for market based vesting conditions 0.410 0.410

Further discount as options unlisted and non-transferable 20% 20%

Value per option 0.328 0.328

(a) vest only after the Company’s share price has traded at $1.20 or above for 20 business days (using 20

day VWAP) and three years’ service. (b) vest only after the Company’s share price has traded at $1.20 or above for 20 business days (using 20

day VWAP) and five years’ service.

KMP Shareholdings

The number of ordinary shares in rhipe Limited (formerly Rhype Limited) held by each KMP of the Group during the financial year is as follows:

BALANCE AT BEGINNING OF

YEAR

GRANTED AS REMUNERATION DURING

THE YEAR

ISSUED ON EXERCISE OF

OPTIONS DURING THE

YEAR OTHER CHANGES

DURING THE YEAR BALANCE AT END OF

YEAR Mike Hill 263,158 - - 59,632 322,790 (a)(b)

Dominic O’Hanlon - 2,400,000 - 866,428 3,266,428 (c)(d)

Dawn Edmonds 5,752,294 - - (2,000,000) 3,752,294 (e)

Laurence Sellers - - - - - -

Mark Pierce - - - - -

Michael Everett 526,316 - - 105,263 631,579 (f)

Philip Kapp 189,474 - - (189,474) - (g)

Ravi Samuel - - - - -

Chris Sharp - - - - -

Warren Nolan 1,384,475 - - (135,000) 1,249,475 (e)

Athena Thompson - - - - -

Mark Carroll 768,064 - - (768,064) - (g)

8,883,781 2,400,000 - (2,061,215) 9,222,566

(a) The KMP exercised 52,632 options during the period. The options exercised were attached to a past capital raising and were not received as compensation.

(b) The KMP purchased 7,000 shares by participating in a Share Purchase Plan. (c) The KMP subscribed for/purchased new ordinary shares during the period. (d) The KMP received 2,400,000 shares via a loan which vest after the Company’s share price has traded at $1.20 or above

for 20 business days (using 20 day VWAP), and in three equal tranches over the escrow periods of 18, 36 & 54 months. (e) The KMP disposed of shares during the period. (f) The KMP exercised 105,263 options during the period. The options exercised were attached to a past capital raising and

were not received as compensation. (g) The KMP ceased employment during the period. There were no other changes to their holding at the date they ceased

employment.

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Other Equity-related KMP Transactions

There have been no other transactions involving equity instruments other than those described in the tables above relating to options, rights and shareholdings.

Other transactions with KMP and/or their related parties

There were no other transactions conducted between the Group and KMP or their related parties, other than those disclosed above relating to equity, compensation and loans, that were conducted other than in accordance with normal employee, customer or supplier relationships on terms no more favourable than those reasonably expected under arm’s length dealings with unrelated persons.

This Directors’ Report, incorporating the Remuneration Report, is signed in accordance with a resolution of the Board of Directors.

Dominic O’Hanlon Managing Director

Dated: 29th September 2015

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Corporate Governance Statement

RHIPE LIMITED (FORMERLY RYHPE LIMITED) ABN 112 452 436

This corporate governance statement sets out rhipe Limited’s (Company) current compliance with the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations (ASX Principles and Recommendations). The ASX Principles and Recommendations are not mandatory. However, this corporate governance statement discloses the extent to which the Company has followed the ASX Principles and Recommendations. This corporate governance statement is current as at 30 June 2015 and has been approved by the board of the Company (Board).


ASX Principles and Recommendations

Comply (Yes/No)

Explanation

1. Lay Solid Foundations for Management and Oversight

1.1 A listed entity should disclose:

(a) the respective roles and responsibilities of its board and management; and

(b) Those matters expressly reserved to the board and those delegated to management.

Yes The Board is responsible for the corporate governance of the Company.

The Board assumes the following responsibilities:

(a) developing initiatives for profit and asset growth;

(b) reviewing the corporate, commercial and financial performance of the Company on a regular basis;

(c) acting on behalf of, and being accountable to, the shareholders; and

(d) Identifying business risks and implementing actions to manage those risks and corporate systems to assure quality.

The Board has delegated specific authorities to the Chairman and to its various Committees. Subject to these delegated matters, the Chairman is authorised to exercise all the powers of the Directors, except with respect to the following:

(a) approval of major elements of strategy including any significant change in the direction of that strategy;

(b) approvals above delegated levels of credit limits, risk exposure, market risk limits and loans and encumbrances;

(c) capital expenditure in excess of delegated levels of expenditure outside the ordinary course of business;

(d) certain remuneration matters including material changes to remuneration policies and specific remuneration recommendations relating to the Board members and other executive officers of the Company;

(e) adoption of the Company’s annual budget;

(f) approval of the interim and final accounts and related reports to the ASX;

(g) specific matters in relation to continuous disclosure as defined in the Continuous Disclosure Policy;

(h) any proposal to issue securities of the Company (except under a program previously approved by the Board); and

(i) other matters as the Board may determine from time to time.

The Company is committed to the circulation of relevant materials to Directors in a timely manner to facilitate Directors’ participation in Board discussions on a fully informed basis.

The Company intends to regularly review the balance of responsibilities between the Board and management to ensure that the division of functions remains appropriate to the needs of the Company.

1.2 A listed entity should:

(a) undertake appropriate checks before appointing a person, or putting forward to security holders a candidate for election, as a director; and

(b) Provide security holders with all material information in its possession relevant to a decision on whether or not to elect or re-elect a director.

Yes The Remuneration and Nomination Committee will identify and recommend board member candidates to the Board. These recommendations will occur after considering the necessary and desirable competencies of new Board members, the range of and depth of skills and the diversity of the Board, and making appropriate checks regarding an individual being put forward.

The Committee will also ensure that all material information in its possession relevant to a decision of whether to appoint or re-elect a director is made available to security holders.

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Comply (Yes/No)

Explanation

1.3 A listed entity should have a written agreement with each director and senior executive setting out the terms of their appointment.

Yes Directors are given letters of appointment and/or service agreements, and senior executives are given employment contracts prior to their engagement with the Company.

1.4 The company secretary of a listed entity should be accountable directly to the board, through the chair, on all matters to do with the proper functioning of the board.

Yes The Company Secretary is appointed by and responsible to the Board through the Chairman. The Chairman and the Company Secretary co-ordinate the Board agenda.


a) have a diversity policy which includes requirements for the board or a relevant committee of the board to set measurable objectives for achieving gender diversity and to assess annually both the objectives and the entity’s progress in achieving them;

b) disclose that policy or a summary of it; and

c) disclose as at the end of each reporting period the measurable objectives for achieving gender diversity set by the board or a relevant committee of the board in accordance with the entity’s diversity policy and its progress towards achieving them and either:

(1) the respective proportions of men and women on the board, in senior executive positions and across the whole organisation (including how the entity has defined “senior executive” for these purposes); or

(2) if the entity is a “relevant employer” under the Workplace Gender Equality Act, the entity’s most recent “Gender Equality Indicators”, as defined in and published under that Act.

Yes The Company adopted a Diversity Policy on 25 June 2015 which sets out the measurable objectives for achieving gender diversity. The Board is committed to assessing annually both the policy’s objectives and its progress towards achieving the measurable objectives.

A copy of the Diversity Policy is available on the Company’s website http://www.rhipe.com/.

As at 30 June 2015, the proportion of women:

on the board was 17%; in senior executive positions was 50%; and in the Company as a whole was 39%.

For the purposes of the Diversity Policy, ‘senior executive’ means an employee who directly reports to the Managing Director or the Board.


(a) have and disclose a process for periodically evaluating the performance of the board, its committees and individual directors; and

(b) disclose, in relation to each reporting period, whether a performance evaluation was undertaken in the reporting period in accordance with that process.

Yes

No

The performance of the Board as a group and of individual Directors will be assessed each year for all future years. In particular, all Directors seeking re-election at an annual general meeting will be subject to a formal performance appraisal to determine whether the Board (with their absenting themselves) recommends their re-election to shareholders.

The Company did not undertake a formal performance appraisal during the reporting period.


(a) have and disclose a process for periodically evaluating the performance of its senior executives; and

(b) disclose, in relation to each reporting period, whether a performance evaluation was undertaken in the reporting period in accordance with that process.

Yes

No

The Board and senior management team intend to regularly review the performance of its senior executives and address any issues that may emerge.

The Company did not undertake a formal performance appraisal during the reporting period.

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25



Comply (Yes/No)

Explanation

2 Structure the Board to Add Value

2.1 The board of a listed entity should:

(a) have a nomination committee which:

1) has at least three members, a majority of whom are independent directors; and

2) is chaired by an independent director, and disclose:

3) the charter of the committee;

4) the members of the committee; and

5) as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or

(b) if it does not have a nomination committee, disclose that fact and the processes it employs to address board succession issues and to ensure that the board has the appropriate balance of skills, knowledge, experience, independence and diversity to enable it to discharge its duties and responsibilities effectively.

Yes

The Company has a Remuneration and Nomination Committee which has four members, a majority of whom are independent directors. The Company has disclosed the details of the members of the committee in the 2015 Directors Report. The Remuneration and Nomination Committee is chaired by Laurie Sellers, an independent director. A copy of the Remuneration and Nomination Committee Charter is available on the Company’s website. The Remuneration and Nomination Committee Charter was adopted on 25 June 2015.

In the 2015 financial year, the Remuneration and Nomination Committee met one time.

2.2 A listed entity should have and disclose a board skills matrix setting out the mix of skills and diversity that the board currently has or is looking to achieve in its membership.

No The Board strives to ensure that it is comprised of directors with a blend of skills, experience and attributes appropriate for the Company and its business. To date, the Board considers that a skills matrix has not been required given the stage of development of the business. However, the Board is currently considering whether it would be appropriate for the Company to adopt a board skills matrix as the Company continues to develop.


(a) the names of the directors considered by the board to be independent directors;

(b) if a director has an interest, position, association or relationship of the type described in Box 2.3 but the board is of the opinion that it does not compromise the independence of the director, the nature of the interest, position, association or relationship in question and an explanation of why the board is of that opinion; and

(c) the length of service of each director.

Yes The Company has disclosed the details of the Directors in the 2015 Directors Report. Information with respect to potential issues of independence may be disclosed to the market but no formal policy exists to ensure such disclosure.

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Comply (Yes/No)

Explanation

2.4 A majority of the board of a listed entity should be independent directors.

No The Board has reviewed the position and associations of each of the six Directors in office and has determined that three of the Directors are independent. In making this determination the Board has had regard to the independence criteria in the ASX Principles and Recommendations, and other facts, information and circumstances that the Board considers relevant. The Board assesses the independence of new Directors upon appointment and reviews their independence, and the independence of the other Directors, as appropriate.

2.5 The chair of the board of a listed entity should be an independent director and, in particular, should not be the same person as the CEO of the entity.

No The Company’s current Chairman, Mr Mike Hill, does not satisfy the ASX Principles and Recommendations definition of an independent director. However, the Board considered Mr Hill's role as Executive Chairman essential during the period where the Company sought to appoint and transition a new CEO. With the appointment of Dominic O'Hanlon on 5th August 2014, it is the intention that Mr Hill will move to a non-executive chairman’s role. Mr Hill does not exercise the role of CEO.

2.6 A listed entity should have a program for inducting new directors and provide appropriate professional development opportunities for directors to develop and maintain the skills and knowledge needed to perform their role as directors effectively.

Yes Each new director of the Company will, upon appointment, participate in an induction program. This will include meeting with members of the existing Board, Company Secretary, management and other relevant executives to familiarise themselves with the Company, its procedures and prudential requirements, and Board practices and procedures.

3 Act Ethically and Responsibly


(a) have a code of conduct for its directors, senior executives and employees; and

(b) disclose that code or a summary of it.

Yes The Board is committed to the establishment and maintenance of appropriate ethical standards in order to instil confidence in both clients and the community in the way the Company conducts its business. These standards are encapsulated in the Code of Conduct which outlines how the Company expects each person who represents it to behave and conduct business.

A copy of the Code of Conduct is available on the Company’s website http://www.rhipe.com/. The Code of Conduct was adopted by the Company on 25 June 2015.

4 Safeguard Integrity in Corporate Reporting


(a) have an audit committee which:

(1) has at least three members, all of whom are non-executive directors and a majority of whom are independent directors; and

(2) is chaired by an independent director, who is not the chair of the board,

and disclose:

(3) the charter of the committee;

(4) the relevant qualifications and experience of the members of the committee; and

(5) in relation to each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or

(b) if it does not have an audit committee, disclose that fact and the processes it employs that independently verify and safeguard the integrity of its corporate reporting, including the processes for the appointment and removal of the external auditor and the

No

Yes

Yes

Yes

Yes

The Company has a separately constituted Audit Committee which consists of three members, a majority of whom are independent directors. One member (Mike Hill) is titled the Executive Chairman of the board, but does not act in a day-to-day executive capacity. The Company has disclosed the relevant qualifications and experience of the members of the committee in the 2015 Directors Report.

The Audit Committee is chaired by Mark Pierce, an independent director.

A copy of the Audit Committee Charter is available on the Company’s website http://www.rhipe.com/. This charter outlines the key areas of responsibility for the Audit Committee, outlining its responsibility for oversight of the quality and integrity of the accounting, auditing, financial reporting and operational risks of the company. The Audit Committee Charter was adopted by the board with effect from 30 June 2015. In the 2015 financial year, the Audit Committee met a total of four times.

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Comply (Yes/No)

Explanation

rotation of the audit engagement partner.

4.2 The board of a listed entity should, before it approves the entity’s financial statements for a financial period, receive from its CEO and CFO a declaration that, in their opinion, the financial records of the entity have been properly maintained and that the financial statements comply with the appropriate accounting standards and give a true and fair view of the financial position and performance of the entity and that the opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.

Yes The Company has received a declaration from the Managing Director and CFO that, in their opinion, the financial records have been properly maintained and comply with the proper standards.

4.3 A listed entity that has an AGM should ensure that its external auditor attends its AGM and is available to answer questions from security holders relevant to the audit.

Yes An external auditor will be present at the AGM and be available to answer questions from security holders relevant to the audit.

5 Make Timely and Balanced Disclosure


(a) have a written policy for complying with its continuous disclosure obligations under the Listing Rules; and

(b) disclose that policy or a summary of it.

Yes The Company is committed to providing timely, complete and accurate disclosure of information to allow a fair, and well-informed market in its securities and compliance with the continuous disclosure requirements imposed by law including the Corporates Act and the ASX Listing Rules.

A copy of the Company’s Continuous Disclosure Policy is available on the Company’s website http://www.rhipe.com/. The Continuous Disclosure Policy was adopted on 25 June 2015.

6 Respect the Rights of Security Holders

6.1 A listed entity should provide information about itself and its governance to investors via its website.

Yes The Company provides information about itself and its governance to its investors via the website http://www.rhipe.com/ which contains all relevant information about the Company. The Company will regularly update the website and contents therein as deemed necessary.

6.2 A listed entity should design and implement an investor relations program to facilitate effective two-way communication with investors.

Yes The Company has instituted an investor relations program to actively engage with shareholders. The Company conducts regular institutional investor roadshows and the CEO and (where required) members of the Board are available to respond to shareholder queries. The program permits shareholders an opportunity to gain a greater understanding of the Company’s business and financial performance.

6.3 A listed entity should disclose the policies and processes it has in place to facilitate and encourage participation at meetings of security holders.

Yes The Company has adopted a formal Shareholders’ Communications Policy to facilitate and encourage participation at meetings of security holders.

A copy of the Shareholders’ Communication Policy is available on the Company’s website http://www.rhipe.com/. The Shareholders’ Communication Policy was adopted on 25 June 2015.

6.4 A listed entity should give security holders the option to receive communications from, and send communications to, the entity and its security registry electronically.

Yes The Company encourages shareholders to register for receipt of announcements and updates electronically.

7 Recognise and Manage Risk


(a) have a committee or committees to oversee risk, each of which:

(1) has at least three members, a majority of whom are independent directors; and

Yes

The Company has a separately constituted Risk Committee which consists of at least three members, a majority of whom are independent directors and the committee is chaired by an independent director. The Company has disclosed the details of the members of the committee in the 2015 Directors Report.

A copy of the Risk Committee Charter is available on the Company website http://www.rhipe.com/. The Risk Committee Charter was adopted with effect from 30 June 2015.

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Comply (Yes/No)

Explanation

(2) is chaired by an independent director, and disclose:


(4) the members of the committee; and

(5) as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or

(b) if it does not have a risk committee or committees that satisfy (a) above, disclose that fact and the processes it employs for overseeing the entity’s risk management framework.

The Risk Committee met a total of two times during the reporting period on 12 September 2014 and 5 February 2015

7.2 The board or a committee of the board should:

(a) review the entity’s risk management framework at least annually to satisfy itself that it continues to be sound; and

(b) disclose, in relation to each reporting period, whether such a review has taken place.

Yes

No

The Board annually reviews and approves the risk management and oversight policies of the Company. However, the Board does not consider that disclosure of when these reviews takes place is necessary.


(a) if it has an internal audit function, how the function is structured and what role it performs; or

(b) if it does not have an internal audit function, that fact and the processes it employs for evaluating and continually improving the effectiveness of its risk management and internal control processes.

No The Company does not have an internal audit function, and does not disclose the processes it uses to improve risk management. Nonetheless, it remains committed to effective management and the control of these factors.

7.4 A listed entity should disclose whether it has any material exposure to economic, environmental and social sustainability risks and, if it does, how it manages or intends to manage those risks.

Yes All material risks are announced to the market, in accordance with the requirements of the ASX listing rules and otherwise.

8 Remunerate Fairly and Responsibly


(a) have a remuneration committee which:

(1) has at least three members, a majority of whom are independent directors; and

(2) is chaired by an independent director, and disclose


Yes

As noted in Section 2.1 above, the Company has a Remuneration and Nomination Committee, which has four members, a majority of whom are independent directors. The Company has disclosed the details of the members of the committee in the 2015 Directors Report. The Remuneration and Nomination Committee is chaired by Laurie Sellers, an independent director.

A copy of the Remuneration and Nomination Committee Charter is available on the Company’s website. The Remuneration and Nomination Committee Charter was adopted on 25 June 2015.

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Comply (Yes/No)

Explanation

(4) the members of the committee; and

(5) as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or’

(b) if it does not have a remuneration committee, disclose that fact and the processes it employs for setting the level and composition of remuneration for directors and senior executives and ensuring that such remuneration is appropriate and not excessive.

In the 2015 financial year, the Remuneration and Nomination Committee met a total of two times.

8.2 A listed entity should separately disclose its policies and practices regarding the remuneration of non-executive directors and the remuneration of executive directors and other senior executives.

Yes The Company discloses its remuneration policy in its annual report.

8.3 A listed entity which has an equity-based remuneration scheme should:

(a) have a policy on whether participants are permitted to enter into transactions (whether through the use of derivatives or otherwise) which limit the economic risk of participating in the scheme; and

(b) disclose that policy or a summary of it.

Yes The Company has a Securities Trading Policy that prohibits directors, offices and employees from entering into transactions or arrangements which limits the economic risk of participating in unvested entitlements under any equity based remuneration scheme.

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AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT

2001 TO THE DIRECTORS OF RHIPE LIMITED AND CONTROLLED ENTITIES (FORMERLY RHYPE

LIMITED)

I declare that, to the best of my knowledge and belief, during the year ended 30 June 2015 there have been

no contraventions of:

(i) the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit, and

(ii) any applicable code of professional conduct in relation to the audit.

SHINEWING AUSTRALIA (formerly Moore Stephens) Chartered Accountants

Rami Eltchelebi Partner

Melbourne, 29 September 2015

ShineWing Australia ABN 39 533 589 331. Liability limited by a scheme approved under Professional Standards Legislation. ShineWing Australia is an independent member of ShineWing International Limited – members in principal cities throughout the world.

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Consolidated Statement of Profit or Loss AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2015

RHIPE LIMITED (FORMERLY RHYPE LIMITED) ABN: 91 112 452 436 AND CONTROLLED ENTITIES

CONSOLIDATED GROUP 2015 2014 Note $’000 $’000 Sales Revenue 3 108,769 74,548

Cost of Sales – licensing fees (88,686) (62,557)

Gross Profit 20,083 11,991

Interest income 3

103

76

Employee benefits expense (12,958) (7,259)

Marketing expenses (1,254) (713)

Office administration expenses (2,249) (1,228)

IT systems & communications (280) (242)

Travel expenses (1,110) (650)

Depreciation and amortisation (182) (98)

Share based payments expense (1,787) (310)

Finance costs (18) -

Write down for assets held for sale (157) -

Other expenses (1,726) (197)

(Loss)/Profit before income tax 4 (1,535) 1,370

Tax expense 5 (786) (486)

(Loss)/Profit after tax for the year attributable to owners of the parent entity (2,321) 884

Other comprehensive income:

Items that will be reclassified subsequently to profit or loss when specific conditions are met:

Exchange differences on translating foreign operations 66 (51)

Other comprehensive income for the year 66 (51)

Total comprehensive (loss)/profit for the year attributable to owners of the parent entity (2,255) 833

(Loss)/Earnings per share

From continuing and discontinued operations:

Basic (loss)/earnings per share (cents) 6 (1.98) 0.51

Diluted (loss)/earnings per share (cents) 6 (1.98) 0.50 The accompanying notes form part of these financial statements.

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Consolidated Statement of Financial Position AS AT 30 JUNE 2015 RHIPE LIMITED (FORMERLY RHYPE LIMITED) ABN: 91 112 452 436 AND CONTROLLED ENTITIES CONSOLIDATED GROUP

Note

2015 $’000

2014 $’000

ASSETS

CURRENT ASSETS

Cash and cash equivalents 7 12,423 4,457

Trade and other receivables 8 27,332 15,061

Other assets 9 3,253 281

Non-current assets held-for-sale 10 350 507

TOTAL CURRENT ASSETS 43,358 20,306

NON-CURRENT ASSETS

Other financial assets 11 2,510 10

Property, plant and equipment 12 519 171

Deferred tax assets 15 770 329

Intangible assets 13 23,082 5,876

TOTAL NON-CURRENT ASSETS 26,881 6,386

TOTAL ASSETS 70,239 26,692

LIABILITIES

CURRENT LIABILITIES

Trade and other payables 14 23,860 16,192

Unearned revenue 2,715 727

Current tax liabilities

15 709 527

Deferred Consideration 27 3,000 -

Provisions

16 756 243

Liabilities associated with assets held for sale 10 158 158

TOTAL CURRENT LIABILITIES 31,198 17,847

NON-CURRENT LIABILITIES

Deferred tax liabilities 15 508 205

Provisions 16 73 211

TOTAL NON-CURRENT LIABILITIES 581 416

TOTAL LIABILITIES 31,779 18,263

NET ASSETS 38,460 8,429

EQUITY Issued capital 17 38,714 8,103

Reserves 1,955 214

Retained earnings (Accumulated losses) (2,209) 112

TOTAL EQUITY 38,460 8,429

The accompanying notes form part of these financial statements.

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Consolidated Statement of Changes in Equity FOR THE YEAR ENDED 30 JUNE 2015


SHARE CAPITAL

RESERVES

ORDINARY

$000

ACCUMULATED RETAINED EARNINGS

$000

FOREIGN CURRENCY

TRANSLATION RESERVE

$000 RESERVE

$000

EQUITY

SETTLED

EMPLOYEE

BENEFITS

RESERVE

$000

TOTAL

$000 CONSOLIDATED GROUP

Balance at 1 July 2013 2,241 (772) (18) (27) - 1,424 Comprehensive income

Profit for the year - 884 - - - 884

Other comprehensive income for the year

Exchange differences on translation of subsidiaries

- - (51) - - (51)

Total comprehensive income for the year - 884 (51) - - 833

TRANSACTIONS WITH OWNERS, IN THEIR CAPACITY AS OWNERS, AND OTHER TRANSFERS

Shares issued during the year 1,070 - - - - 1,070

Transaction costs, net of tax (64) - - - - (64)

Deemed cost of reverse acquisition 6,360 - - - - 6,360

Shares bought back during the year (1,504) - - - - (1,504)

Share based payments - - - - 310 310

Total transactions with owners and other transfers

5,862 - - - 310 6,172

Balance at 30 June 2014 8,103 112 (69) (27) 310 8,429

Balance at 1 July 2014 8,103 112 (69) (27) 310 8,429 Comprehensive income

Profit for the year - (2,321) - - - (2,321)

Other comprehensive income for the year

Exchange differences on translation of subsidiaries

- - 66 - - 66

Total comprehensive income for the year - (2,321) 66 - - (2,255)

TRANSACTIONS WITH OWNERS, IN THEIR CAPACITY AS OWNERS, AND OTHER TRANSFERS

Shares issued during the year 31,364 - - - (112) 31,252

Transaction costs, net of tax (753) - - - - (753)

Share based payments - - - - 1,787 1,787

Total transactions with owners and other transfers

30,611 (2,321) 66 - 1,675 30,031

Balance at 30 June 2015 38,714 (2,209) (3) (27) 1,985 38,460


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Consolidated Statement of Cash Flows FOR THE YEAR ENDED 30 JUNE 2015 RHIPE LIMITED (FORMERLY RHYPE LIMITED) ABN: 91 112 452 436 AND CONTROLLED ENTITIES

CONSOLIDATED GROUP

2015 2014 Note $000 $000

CASH FLOWS FROM OPERATING ACTIVITIES

Receipts from customers 105,616 76,300

Payments to suppliers and employees (110,118) (73,889)

Interest received 103 76

Income tax paid (768) (140)

Net cash (used in)/ provided by operating activities 20 (5,167) 2,347 CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property, plant and equipment (407) (31)

Loans to related parties: - proceeds from repayments - 195

Payment for acquisition of subsidiary

27 (9,609) -

Cash held by subsidiary at acquisition

45 959

Payments for intangibles (346)

(358)

Payments for investments (2,500) -

Net cash (used in)/ provided by investing activities (12,817) 765

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from issue of shares 26,904 1,070

Payment for share issue costs (1,119) (91)

Share buy-back payment - (1,504)

Dividends paid by parent entity - (126)

Net cash provided by / (used in) financing activities 25,785 (651)

Net increase in cash held 7,801 2,461

Cash and cash equivalents at beginning of financial year 4,457 1,997

Effect of exchange rates on cash holdings in foreign currencies 165 (1)

Cash and cash equivalents at end of financial year 7 12,423 4,457


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Notes to the Financial Statements FOR THE YEAR ENDED 30 JUNE 2015 RHIPE LIMITED (FORMERLY RHYPE LIMITED) ABN: 91 112 452 436 AND CONTROLLED ENTITIES These consolidated financial statements and notes represent those of rhipe Limited (formerly Rhype Limited) and Controlled Entities (the “consolidated group” or “group”). The financial statements were authorised for issue on 29th September 2015 by the directors of the company.

Note 1 Summary of Significant Accounting Policies Basis of Preparation These general purpose financial statements have been prepared in accordance with the Corporations Act 2001, Australian Accounting Standards and Interpretations of the Australian Accounting Standards Board and International Financial Reporting Standards as issued by the International Accounting Standards Board. The Group is a for- profit entity for financial reporting purposes under Australian Accounting Standards. Material accounting policies adopted in the preparation of these financial statements are presented below and have been consistently applied unless stated otherwise.

Except for cash flow information, the financial statements have been prepared on an accruals basis and are based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities. (a) Basis of Accounting

The consolidated financial statements have been prepared on the basis of historical cost, except for certain properties and financial instruments that are measured at revalued amounts or fair values at the end of each reporting period, as explained in the accounting policies below. Historical cost is generally based on the fair values of the consideration given in exchange for goods and services. All amounts are presented in Australian dollars, unless otherwise noted. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Group takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated financial statements is determined on such a basis.

In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the

entity can access at the measurement date;

Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and

Level 3 inputs are unobservable inputs for the asset or liability. (b) Principles of Consolidation The consolidated financial statements incorporate all of the assets, liabilities and results of rhipe Limited (formerly Rhype Limited) and all of its subsidiaries (including any structured entities). Subsidiaries are entities the Parent controls. The Parent controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. A list of the subsidiaries is provided in Note 21. The assets, liabilities and results of all subsidiaries are fully consolidated into the financial statements of the Group from the date on which control is obtained by the Group. The consolidation of a subsidiary is discontinued from the date that control ceases. Inter-company transactions, balances and unrealised gains or losses on transactions between Group entities are fully eliminated on consolidation. Accounting policies of subsidiaries have been changed and adjustments made where necessary to ensure uniformity of the accounting policies adopted by the Group.

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED

Equity interests in a subsidiary not attributable, directly or indirectly, to the Group are presented as ‘Non-controlling Interests’. The Group initially recognises non-controlling interests that are present ownership interests in subsidiaries and are entitled to a proportionate share of the subsidiary’s net assets on liquidation at either fair value or at the non-controlling interests’ proportionate share of the subsidiary’s net assets. Subsequent to initial recognition, non-controlling interests are attributed their share of profit or loss and each component of other comprehensive income. Non-controlling interests are shown separately within the equity section of the statement of financial position and statement of comprehensive income. (c) Business Combinations Business combinations occur where an acquirer obtains control over one or more businesses. A business combination is accounted for by applying the acquisition method, unless it is a combination involving entities or businesses under common control. The business combination will be accounted for from the date that control is attained whereby the fair value of the identifiable assets acquired and liabilities (including contingent liabilities) assumed is recognised (subject to certain limited exemptions). When measuring the consideration transferred in the business combination, any asset or liability resulting from a contingent consideration arrangement is also included. Subsequent to initial recognition, contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity. Contingent consideration classified as an asset or liability is remeasured each reporting period to fair value, recognising any change to fair value in profit or loss, unless the change in value can be identified as existing at acquisition date. All transaction costs incurred in relation to business combinations, other than those associated with the issue of a financial instrument, are recognised as expenses in profit or loss when incurred. The acquisition of a business may result in the recognition of goodwill or a gain from a bargain purchase. On 10 April 2014, rhipe Limited (formerly Rhype Limited) acquired 100% of the then issued shares in NewLease Pty Ltd. Under the principles in AASB 3: Business Combinations, NewLease Pty Ltd was deemed to be the acquirer for accounting purposes. Therefore, the reorganisation has been accounted for in the consolidated financial statements consistent with the principles applicable to a reverse acquisition under AASB 3. Accordingly, the consolidated financial statements have been prepared as a continuation of the financial statements of NewLease Pty Ltd, subject to the adjustments described below:

• the assets and liabilities of NewLease Pty Ltd have been recognised and measured at their pre-reorganisation carrying amounts;

• goodwill has been recognised in respect of the combination; and • the consolidated financial statements reflect:

– the assets and liabilities of rhipe Limited (formerly Rhype Limited) were recognised and measured in accordance with AASB 3;

– the retained earnings and other equity balances recognised before the date of the reorganisation reflect those of NewLease Pty Ltd; and

– the equity structure after the date of reorganisation reflects the structure of rhipe Limited (formerly Rhype Limited).

(d) Goodwill Goodwill is carried at cost less any accumulated impairment losses. Goodwill is calculated as the excess of the sum of:

(i) the consideration transferred; (ii) any non-controlling interest (determined under either the full goodwill or proportionate interest method);

and (iii) the acquisition date fair value of any previously held equity interest, over the acquisition date fair value of

net identifiable assets acquired.

The acquisition date fair value of the consideration transferred for a business combination plus the acquisition date fair value of any previously held equity interest shall form the cost of the investment in the separate financial statements. The amount of goodwill recognised on acquisition of each subsidiary in which the Group holds less than a 100% interest will depend on the method adopted in measuring the non-controlling interest. The Group can elect in most circumstances to measure the non-controlling interest in the acquiree either at fair value (full goodwill

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED method) or at the non-controlling interest’s proportionate share of the subsidiary’s identifiable net assets (proportionate interest method). In such circumstances, the Group determines which method to adopt for each acquisition and this is stated in the respective notes to these financial statements disclosing the business combination. Goodwill is tested for impairment annually (refer to Note 1(j) for details of impairment) and is allocated to the Group’s cash generating units or groups of cash generating units, representing the lowest level at which goodwill is monitored being not larger than an operating segment. Gains and losses on the disposal of an entity include the carrying amount of goodwill related to the entity disposed of. (e) Income Tax The income tax expense/(benefit) for the year comprises current income tax expense/(benefit) and deferred tax expense/(benefit). Current income tax expense/(benefit) charged to profit or loss is the tax payable on taxable income. Current tax liabilities/(assets) are measured at the amounts expected to be paid to/(recovered from) the relevant taxation authority. Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year as well as unused tax losses. Current and deferred income tax expense/ (income) is charged or credited outside profit or loss when the tax relates to items that are recognised outside profit or loss. Except for business combinations, no deferred income tax is recognised from the initial recognition of an asset or liability, where there is no effect on accounting or taxable profit or loss. Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled and their measurement reflects the manner in which management expects to recover or settle the carrying amount of the related asset or liability. With respect to non-depreciable items of property, plant and equipment measured at fair value, the related deferred tax liability or deferred tax asset is measured on the basis that the carrying amount of the asset will be recovered entirely through sale. Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is probable that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised. Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference cannot be controlled and it is not probable that the reversal will occur in the foreseeable future. Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are offset where: (a) a legally enforceable right of set-off exists; and (b) the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled. Tax consolidation

Relevance of tax consolidation to the Group

The company and its wholly-owned Australian resident entities have formed a tax-consolidated group with effect from 2015 and are therefore taxed as a single entity from that date. The head entity within the tax-consolidated group is rhipe Limited. Tax expense/benefit, deferred tax liabilities and deferred tax assets arising from temporary differences of the members of the tax-consolidated group are recognised in the separate financial statements of the members of the tax-consolidated group using the ‘separate taxpayer within group’ approach by reference to the carrying amounts in the separate financial statements of each entity and the tax values applying under tax consolidation. Current tax liabilities and assets and deferred tax assets arising from unused tax losses and relevant tax credits of the members of the tax consolidated group are recognised by the company (as head entity in the tax-consolidated group).

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED Due to the existence of a tax funding arrangement between the entities in the tax-consolidated group, amounts are recognised as payable to or receivable by the company and each member of the group in relation to the tax contribution amounts paid or payable between the parent entity and the other members of the tax-consolidated group in accordance with the arrangement. Nature of tax funding arrangements and tax sharing agreements Entities within the tax-consolidated group have entered into a tax funding arrangement and a tax sharing agreement with the head entity. Under the terms of the tax funding arrangement, rhipe Limited and each of the entities in the tax-consolidated group have agreed to pay a tax equivalent payment to or from the head entity, based on the current tax liability or current tax asset of the entity. The tax sharing agreement entered into between members of the tax-consolidated group provides for the determination of the allocation of income tax liabilities between the entities should the head entity default on its tax payment obligations or if an entity should leave the tax consolidated group. The effect of the tax sharing agreement is that each member’s liability for tax payable by the tax-consolidated group is limited to the amount payable to the head entity under the tax funding arrangement. (f) Property, Plant and Equipment Each class of property, plant and equipment is carried at cost less, where applicable, any accumulated depreciation and impairment losses. Plant and equipment Plant and equipment are measured on the cost basis and therefore carried at cost less accumulated depreciation and any accumulated impairment. In the event the carrying amount of plant and equipment is greater than the estimated recoverable amount, the carrying amount is written down immediately to the estimated recoverable amount and impairment losses are recognised either in profit or loss or as a revaluation decrease if the impairment losses relate to a revalued asset. A formal assessment of the recoverable amount is made when impairment indicators are present (refer to Note 1(j) for details of impairment of assets). Depreciation The depreciable amount of all fixed assets including buildings and capitalised lease assets, but excluding freehold land, is depreciated on a straight-line basis over the asset’s useful life to the company commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements. The depreciation rates used for each class of depreciable assets are: Class of Fixed Asset Depreciation Rate Computer Equipment 8% - 67% Furniture & Fittings 2% - 40% The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are recognised in profit or loss in the period in which they arise. (g) Leases Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are recognised as expenses in the periods in which they are incurred. Lease incentives under operating leases are recognised as a liability and amortised on a straight-line basis over the lease term. (h) Non-current assets held for sale and discontinued operations Non-current assets are classified as held for sale and measured at the lower of carrying amount and fair value less costs to sell where the carrying amount will be recovered principally through sale as opposed to continued use. No depreciation or amortisation is charged against assets classified as held for sale.

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED Classification as “held for sale” occurs when: management has committed to a plan for immediate sale; the sale is expected to occur within one year from the date of classification; and active marketing of the asset has commenced. Such assets are classified as current assets. Impairment losses are recognised for any initial or subsequent write-down of an asset classified as held for sale to fair value less costs to sell. Any reversals of impairment recognised on classification as held for sale or prior to such classification are recognised as a gain in profit or loss in the period in which it occurs. (j) Financial Instruments

Recognition and Initial Measurement Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions to the instrument. For financial assets, this is equivalent to the date that the company commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted). Financial instruments are initially measured at fair value plus transactions costs.

Classification and Subsequent Measurement Financial instruments are subsequently measured at fair value, amortised cost using the effective interest method, or cost.

Amortised cost is calculated as the amount at which the financial asset or financial liability is measured at initial recognition less principal repayments and any reduction for impairment, and adjusted for any cumulative amortisation of the difference between that initial amount and the maturity amount calculated using the effective interest method.

The effective interest method is used to allocate interest income or interest expense over the relevant period and is equivalent to the rate that discounts estimated future cash payments or receipts (including fees, transaction costs and other premiums or discounts) over the expected life (or when this cannot be reliably predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying amount with a consequential recognition of an income or expense item in profit or loss. The Group does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the requirements of accounting standards specifically applicable to financial instruments.

i. Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost.

Gains or losses are recognised in profit or loss through the amortisation process and when the financial asset is derecognised.

ii. Available for sale (AFS) financial assets Listed shares that are traded in an active market are classified as AFS and stated at fair value. Shares in an unlisted company are stated at cost. Gains and losses arising from changes in fair value are recognised in other comprehensive income and accumulated in the investments revaluation reserve, with the exception of impairment losses, are recognised in profit or loss. Where the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously accumulated in the investments revaluation reserve is reclassified to profit or loss. Dividends on AFS equity instruments are recognised in profit or loss when the Group’s right to receive the dividends is established.

iii. Financial Liabilities Non-derivative financial liabilities other than financial guarantees are subsequently measured at amortised cost. Gains or losses are recognised in profit or loss through the amortisation process and when the financial liability is derecognised.

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED Impairment At the end of each reporting period, the Group assesses whether there is objective evidence that a financial asset has been impaired. A financial asset or a group of financial assets is deemed to be impaired if, and only if, there is objective evidence that impairment as a result of one or more events (a ‘loss event’) has occurred, which has an impact on the estimated future cash flows of the financial asset(s). For AFS equity instruments, including listed or unlisted shares, objective evidence of impairment includes information about significant changes with an adverse effect that have taken place in the technological, market, economic or legal environment in which the issuer operates, and indicates that the cost of the investment in the equity instrument may not be recovered. A significant or prolonged decline in the fair value of the security below its cost is considered to be objective evidence of impairment for unlisted shares classified as available-for-sale. In the case of financial assets carried at amortised cost, loss events may include: indications that the debtors or a group of debtors are experiencing significant financial difficulty, default or delinquency in interest or principal payments; indications that they will enter bankruptcy or other financial reorganisation; and changes in arrears or economic conditions that correlate with defaults. For financial assets carried at amortised cost (including loans and receivables), a separate allowance account is used to reduce the carrying amount of financial assets impaired by credit losses. After having taken all possible measures of recovery, if management establishes that the carrying amount recovered by any means, at that point the written-off amounts are charged to the allowance account or the carrying amount of impaired financial assets is reduced directly if no impairment amount was previously recognised in the allowance account. When the terms of financial assets that would otherwise have been past due or impaired have been renegotiated, the Group recognises the impairment for such financial assets by taking into account the original terms as if the terms have not been renegotiated so that the loss events that have occurred are duly considered. When an AFS financial asset is considered to be impaired, cumulative gains or losses previously recognised in other comprehensive income are reclassified to profit or loss in the period. In respect of AFS equity securities, impairment losses previously recognised in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognised in other comprehensive income and accumulated under the heading of investments revaluation reserve. In respect of AFS debt securities, impairment losses are subsequently reversed through profit or loss if an increase in the fair value of the investment can be objectively related to an event occurring after the recognition of the impairment loss. De-recognition Financial assets are derecognised when the contractual rights to receipt of cash flows expire or the asset is transferred to another party whereby the entity no longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised when the related obligations are discharged, cancelled or have expired. The difference between the carrying amount of the financial liability extinguished or transferred to another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss.

(j) Impairment of Assets At the end of each reporting period, the Group assesses whether there is any indication that an asset may be impaired. The assessment will include the consideration of external and internal sources of information including dividends received from subsidiaries, associates or jointly controlled entities deemed to be out of pre-acquisition profits. If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, to the asset’s carrying amount. Any excess of the asset’s carrying amount over its recoverable amount is recognised immediately in profit or loss. Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Impairment testing is performed annually for goodwill, intangible assets with indefinite lives and intangible assets not yet available for use.

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED (k) Intangibles Other than Goodwill Research and development Expenditure during the research phase of a project is recognised as an expense when incurred. Development costs are capitalised only when technical feasibility studies identify that the project is expected to deliver future economic benefits and these benefits can be measured reliably. Capitalised development costs have a finite useful life and are amortised on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. The software development asset has a useful life of 5 years. (l) Foreign Currency Transactions and Balances

Functional and presentation currency The functional currency of each of the Group’s entities is measured using the currency of the primary economic environment in which that entity operates. The consolidated financial statements are presented in Australian dollars which is the parent entity’s functional currency. Transaction and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non- monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined. Exchange differences arising on the translation of monetary items are recognised in profit or loss, except where deferred in equity as a qualifying cash flow or net investment hedge. Exchange differences arising on the translation of non-monetary items are recognised directly in other comprehensive income to the extent that the underlying gain or loss is recognised in other comprehensive income, otherwise the exchange difference is recognised in the profit or loss. Group companies The financial results and position of foreign operations whose functional currency is different from the group’s presentation currency are translated as follows: — Assets and liabilities are translated at exchange rates prevailing at the end of the reporting period;

— Income and expenses are translated at average exchange rates for the period; and

— Retained earnings are translated at the exchange rates prevailing at the date of the transaction. Exchange differences arising on translation of foreign operations with functional currencies other than Australian dollars are recognised in other comprehensive income and included in the foreign currency translation reserve in the statement of financial position. The cumulative amount of these differences is reclassified into profit or loss in the period in which the operation is disposed of. (m) Employee Benefits Short-term employee benefits Provision is made for the Group’s obligation for short-term employee benefits. Short-term employee benefits are benefits (other than termination benefits) that are expected to be settled wholly before 12 months after the end of the annual reporting period in which the employees render the related service, including wages, salaries and sick leave. Short- term employee benefits are measured at the (undiscounted) amounts expected to be paid when the obligation is settled. The Group’s obligations for short-term employee benefits such as wages, salaries, employees’ annual leave and sick leave are recognised as a part of current trade and other payables in the statement of financial position. The Group’s obligations for long service leave entitlements are recognised as provisions in the statement of financial position.

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED Other long-term employee benefits Provision is made for employees’ long service leave and annual leave entitlements not expected to be settled wholly within 12 months after the end of the annual reporting period in which the employees render the related service. Other long-term employee benefits are measured at the present value of the expected future payments to be made to employees. Expected future payments incorporate anticipated future wage and salary levels, durations of service and employee departures and are discounted at rates determined by reference to market yields at the end of the reporting period on government bonds that have maturity dates that approximate the terms of the obligations. Any remeasurements for changes in assumptions of obligations for other long-term employee benefits are recognised in profit or loss in the periods in which the changes occur. The Group’s obligations for long-term employee benefits are presented as non-current provisions in its statement of financial position, except where the Group does not have an unconditional right to defer settlement for at least 12 months after the end of the reporting period, in which case the obligations are presented as current provisions. Equity-settled compensation The Group operates an employee share and option plan. Share-based payments to employees are measured at the fair value of the instruments issued and amortised over the vesting periods. The corresponding amount is recorded to the equity-settled employee benefits reserve. The fair value of options is determined using the Black–Scholes pricing model. The number of shares and options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount recognised for services received as consideration for the equity instruments granted is based on the number of equity instruments that eventually vest. (n) Provisions Provisions are recognised when the group has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured. Provisions are measured using the best estimate of the amounts required to settle the obligation at the end of the reporting period. (o) Provision for Warranties Provision is made in respect of the Group’s best estimate of the liability on all products and services under warranty at the end of the reporting period. The provision is measured as the present value of future cash flows estimated to be required to settle the warranty obligation. The future cash flows have been estimated by reference to the consolidated group’s history of warranty claims. (p) Cash and Cash Equivalents Cash and cash equivalents include cash on hand, deposits available on demand with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are reported within short- term borrowings in current liabilities in the statement of financial position. (q) Revenue and Other Income Revenue is measured at the fair value of the consideration received or receivable after taking into account any trade discounts and volume rebates allowed. When the inflow of consideration is deferred it is treated as the provision of financing and is discounted at a rate of interest that is generally accepted in the market for similar arrangements. The difference between the amount initially recognised and the amount ultimately received is interest revenue. Revenue recognition relating to the provision of services is determined with reference to the stage of completion of the transaction at the end of the reporting period where outcome of the contract can be estimated reliably. Stage of completion is determined with reference to the services performed to date as a percentage of total anticipated services to be performed. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent that related expenditure is recoverable. Interest revenue is recognised using the effective interest method. Dividend revenue is recognised when the right to receive a dividend has been established. Dividends received from associates and joint venture entities are accounted for in accordance with the equity method of accounting. All revenue is stated net of the amount of goods and services tax.

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(r) Trade and Other Receivables Trade and other receivables include amounts due from customers for goods sold and services performed in the ordinary course of business. Receivables expected to be collected within 12 months of the end of the reporting period are classified as current assets. All other receivables are classified as non-current assets. Trade and other receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any provision for impairment. Refer to Note 1(i) for further discussion on the determination of impairment losses. (s) Trade and Other Payables Trade and other payables represent the liabilities for goods and services received by the entity that remain unpaid at the end of the reporting period. The balance is recognised as a current liability with the amounts normally paid within 30 days of recognition of the liability. (t) Goods and Services Tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office (ATO). Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the ATO is included with other receivables or payables in the statement of financial position. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to, the ATO are presented as operating cash flows included in receipts from customers or payments to suppliers. (u) Comparative Figures When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.

(v) Rounding of Amounts The parent entity has applied the relief available to it under ASIC Class Order 98/100. Accordingly, amounts in the financial statements and directors’ report have been rounded off to the nearest $1,000. (w) Critical Accounting Estimates and Judgments The directors evaluate estimates and judgments incorporated into the financial statements based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Group. Key Estimates

(i) Operating segments, cash generating unit determination Goodwill is required to be allocated to cash generating units and tested for impairment on an annual basis. Management apply judgement in determining cash-generating units and allocating the goodwill arising from business combinations to these cash-generating units.

(ii) Impairment of goodwill

Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which goodwill has been allocated. The value in use calculation requires the directors to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. Where the actual future cash flows are less than expected, a material impairment loss may arise.

(iii) Recoverability of internally generated intangible assets

Internally generated intangible assets are capitalised in accordance with AASB 138 Intangible Assets. Assumptions and judgements are made with regard to assessing the expected future economic benefits, the economic useful life and the level of completion. At the point where activities no longer relate to development but to maintenance, capitalisation is discontinued.

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(iv) Equity settled compensation The consolidated entity measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using the BlackScholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity.

(v) Assets held for sale

Upon entering into a conditional agreement for the sale of the Group’s mine camp asset, rhipe reclassified the assets and liabilities pertaining to those activities to ‘held for sale’ in accordance with AASB 5, Non-current assets Held for Sale and Discontinued Operations (see Note 10). Judgements and estimates had to be applied for the valuation assumptions.

(vi) Deferred consideration

Deferred consideration for acquisitions includes deferred and contingent consideration. Deferred payments for historical business acquisitions are generally contingent on the future revenue and/or profits achieved by the acquired business. On acquisition date, estimates are made of the expected future revenue and profit based on forecasts made by management. These estimates are re-assessed at each reporting date and adjustments are made to the deferred consideration and related goodwill balances, where necessary. Amounts of deferred consideration payable after one year are discounted using discount rates that reflect the current market assessment of the time value of money and, where appropriate, the risks specific to the acquired business.

Determining whether goodwill is impaired requires an estimation of the value in use of the cash generating units to which goodwill has been allocated. The value in use calculation requires the directors to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. Where the actual future cash flows are less than expected, a material impairment loss may arise. (x) New Accounting Standards for Application in Future Periods

– AASB 9: Financial Instruments and associated amending standards (applicable for annual reporting periods commencing on or after 1 January 2018)

AASB 9 will be applicable retrospectively (subject to the comment on hedge accounting below) and includes revised requirements for the classification and measurement of financial instruments, revised recognition and de-recognition requirements for financial instruments and simplified requirements for hedge accounting.

The key changes made to the Standard that may affect the Group on initial application include certain simplifications to the classification of financial assets, simplifications to the accounting of embedded derivatives, and the irrevocable election to recognise gains and losses on investments in equity instruments that are not held for trading in other comprehensive income. AASB 9 also introduces a new model for hedge accounting that will allow greater flexibility in the ability to hedge risk, particular with respect to hedge of non-financial items. Should the entity elect to change its hedge policies in line with the new hedge accounting requirements of AASB 9, the application of such accounting would be largely prospective.

Although the directors anticipate that the adoption of AASB 9 may have an impact on the Group’s financial instruments, including hedging activity, it is impracticable at this stage to provide a reasonable estimate of such impact.

– AASB 15: Revenue from Contracts with Customers (applicable for annual reporting periods commencing on or after 1st January 2017)

This standard, when effective, will replace the current accounting requirements applicable to revenue with a single, principles-based model. Except for a limited number of exceptions, including leases, the new revenue model in AASB 15 will apply to all contracts with customers as well as non-monetary exchanges between entities in the same line of business to facilitate sales to customers and potential customers. The core principle of AASB 15 is that an entity will recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED entitled in exchange for the goods or services. To achieve this objective, AASB 15 provides the following five-step model:

identify the contract(s) with a customer; identify the performance obligations in the contract(s); determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognise revenue when (or as) the performance obligation is satisfied.

AASB 15 also requires enhanced disclosures regarding revenues. This standard will require retrospective restatement and is available for early adoption.

Although the directors anticipate that the adoption of AASB 15 may have an impact on the Group’s financial statements, it is impracticable at this stage to provide a reasonable estimate of such impacts.

– AASB 2014-1: Amendments to Australian Accounting Standards (Parts D and E)

Part D of this Standard makes amendments to AASB 1 First-time Adoption of Australian Accounting Standards, which arise from the issuance of AASB 14 Regulatory Deferral Accounts in June 2014. Part D is applicable for annual reporting periods beginning on or after 1 January 2016. Part E of this standard which is applicable from financial years beginning on or after 1 January 2015 inter-alia defers the application date of AASB 9: Financial Instruments (December 2010) to annual reporting periods beginning on or after 1st January 2018. This part also makes consequential amendments to hedge accounting disclosures set out in AASB 7 Financial Instruments: Disclosures and to AASB 132 Financial Instruments: Presentation to permit irrevocable designation of ‘own use contracts’ as measured at fair value through profit or loss if the designation eliminates or significantly reduces an Accounting mismatch. This Standard is not expected to significantly impact the Group’s financial statements.

– AASB 2014-3: Amendments to Australian Accounting Standards – Accounting for Acquisitions of Interests in Joint Operations (applicable for annual reporting periods commencing on or after 1 January 2016).

AASB 2014-3 amends AASB 11: Joint Arrangements to provide guidance on the accounting for acquisitions of interests in joint operations in which the activity constitutes a business. The amendments require the acquirer of an interest in a joint operation:

in which the activity constitutes a business, as defined in AASB 3 Business Combinations, to apply all of the principles on business combinations accounting in AASB 3 and other Australian Accounting Standards except for those principles that conflict with the guidance in AASB 11; and

disclose the information required by AASB 3 and other Australian Accounting Standards for business combinations.

Since this standard will apply only to acquisition of interests in Joint operations on or after 1st January 2016, the management believes it is impracticable at this stage to provide a reasonable estimate of such impact.

– AASB 2014-4: Amendments to Australian Accounting Standards – Clarification of Acceptable Methods of Depreciation and Amortisation

This Standard applies to annual reporting periods beginning on or after 1 January 2016 and is meant to clarify that a revenue-based method to calculate the depreciation or amortisation of an asset is not appropriate and that the expected pattern of consumption of the future economic benefits from the asset is a more appropriate basis. However, this could be a rebuttable presumption in limited circumstances. These amendments are to be prospectively applied on transition.

This Standard is not expected to significantly impact the Group’s financial statements.

– AASB 2014-7: Amendments to Australian Accounting Standards arising from AASB 9 (December 2014)

This Standard gives effect to the consequential amendments to Australian Accounting Standards (including Interpretations) arising from the issue of AASB 9 (December 2014). More significantly, additional disclosure requirements have been added to AASB 7 Financial Instruments: Disclosures that includes information on credit risk exposures of the entity. It also makes various editorial corrections to Australian Accounting Standards (including an Interpretation). This Standard applies to annual reporting periods beginning on or after 1st January 2018. This Standard will be applied when AASB 9 (December 2014) is applied. Earlier application is permitted.


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– AASB 2014-8: Amendments to Australian Accounting Standards arising from AASB 9 (December 2014) - Application of AASB 9 (December 2009) and AASB 9 (December 2010)

This Standard makes amendments to the earlier versions of AASB 9 (December 2014), namely AASB 9 (December 2009) and AASB 9 (December 2010) such that for annual reporting periods beginning on or after 1st January 2015, an entity may apply AASB 9 (December 2009) or AASB 9 (December 2010) if, and only if, the entity’s date of initial application (as described in the applicable Standard) is before 1 February 2015.


– AASB 2014-9: Amendments to Australian Accounting Standards – Equity Method in Separate Financial Statements

This Standard amends AASB 127, and consequentially amends AASB 1 and AASB 128, to allow entities to use the equity method of accounting for investments in subsidiaries, joint ventures and associates in their separate financial statements. It is applicable from annual reporting periods beginning on or after 1st January 2016. Earlier application is permitted. These amendments are to be prospectively applied on transition.This Standard is not expected to significantly impact the Group’s Consolidated financial statements.

– AASB 2015-1: Amendments to Australian Accounting Standards – Annual Improvements to Australian Accounting Standards 2012–2014 Cycle

This standard is applicable from annual reporting periods beginning on or after 1st January 2016 with earlier application being permitted. Significant amendments to this standard that are to be prospectively applied include the following:

a) Clarifications in AASB 5 Non-current Assets Held for Sale and Discontinued Operations that a change of status from ‘Held for Sale’ to ‘Held for distribution to owners or vice versa does not mean discontinuation of the original plan of proposal.

b) Additional guidance in AASB 7 on assessment of ‘continuing involvement’ (as provided in AASB 139 or

AASB 9) in servicing contracts for the purpose of disclosure requirements.

c) Amendments to AASB 119 Employee Benefits to allow references to government bonds to be made from a currency perspective rather than from a regional perspective.

d) Permitting the disclosures pursuant to AASB 134.16A to be given by cross referencing from the interim financial statements to some other statement (such as management commentary or risk report).


– AASB 2015-2: Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 101

This standard is applicable from annual reporting periods beginning on or after 1st January 2016 with earlier application being permitted. The amendments therein focus on clarifying the presentation and disclosure requirements in AASB 101, such that entities are able to judge appropriately as to how and/or what information is to be disclosed in their financial statements. Further, this standard also includes other editorial/consequential amendments to other AASB standards.


– AASB 2015-3: Amendments to Australian Accounting Standards arising from the Withdrawal of AASB 1031 Materiality

This Standard completes the AASB project regarding the withdrawal of AASB 1031 Materiality (July 2004), by amending AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors to supersede AASB 1031 (July 2004) and deletes references to AASB 1031 in the Australian Accounting Standards listed in the Appendix to this Standard. The standard is applicable from 1st July 2015 and until then, AASB 1031 (December 2013) (that was earlier re-issued in lieu of AASB 1031 (July 2004)) will continue to act as a reference standard directing financial statement preparers to apply the materiality requirements in AASB 101 and AASB 108.


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Note 2 Operating Segments

The Group has identified its operating segments based on the internal reports that are reviewed and used by the Managing Director (chief operating decision maker) in assessing performance and determining the allocation of resources. The Managing Director manages the Group’s activities as one business segment providing cloud based licensing programs for its key software vendors across the Asia Pacific region. Revenue derived from countries in the Asia Pacific region include:

CONSOLIDATED GROUP

2015 2014 $000 $000

Australia 64,438 49,767

Singapore 22,499 14,595

New Zealand 10,394 5,385

Philippines 6,166 3,188

Thailand 2,319 1,589

Other 2,953 24

108,769 74,548 Information about major customers No single customer contributed 10% or more to the Group’s revenue for both 2015 and 2014. Information about major vendors Included in revenues arising from sales of cloud based licensing programs of $108,769,000 (2014: $74,548,000) are revenues from two major vendors of $67,170,197 (2014:$49,582,208) and $19,724,211 (2014: $15,804,366). There are no other single vendors which contributed 10% or more to the Group’s revenue for both 2015 and 2014.

Note 3 Revenue and Other Income

CONSOLIDATED GROUP 2015 2014

$000 $000

(a) Revenue from continuing operations Sales revenue

- Licensing revenue 105,052 73,875

- Service revenue 3,717 673

Interest revenue from

- directors - 8

- other persons 103 68

Total interest revenue on financial assets not at fair value through profit or loss 103 76

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Note 4 Profit for the Year

CONSOLIDATED GROUP Profit before income tax from continuing operations includes the following specific expenses:

2015 2014 $000 $000

Expenses Costs of sales – licensing fees 88,686 62,557

Employee benefits expense

- Defined contribution superannuation expense 865 498

Rental expense on operating leases 614 331

Depreciation of property, plant and equipment 73 57

Amortisation of intangible assets – capitalised development 109 41

Foreign exchange loss 288 86

Acquisition related costs 441 -

Note 5 Tax Expense

CONSOLIDATED GROUP

2015 2014 Note $000 $000

(a) The components of tax (expense)/income comprise:

Current tax 933 750 Deferred tax 15 278 (294)

Under/(over) provision in respect of prior years (425) 30

786 486 (b) The prima facie tax on profit from ordinary activities before income tax is

reconciled to the income tax as follows:

Prima facie tax payable on profit from ordinary activities before income tax at 30% (2014: 30%)

- Consolidated group (461) 411

- Effect of tax rates of subsidiaries operating in other jurisdictions 156 12

Add tax effect of:

- Other non-allowable items 653 100

- Less tax effect of: 348 523

Under/(over) provision of prior year income tax

(425) 30

- Current year overseas subsidiaries revenue losses not recognised

927 (30)

- Research and development offset (64) (67)

786 486

The applicable weighted average effective tax rates are as follows: (51.2%) 35.5%

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(c) Amounts recognised directly in equity:

Aggregate current and deferred tax arising in the reporting period and not recognised in net profit or loss or other comprehensive income but directly debited to equity: CONSOLIDATED GROUP

2015 2014 $000 $000

Transaction costs 366 27 Unrecognised tax losses When rhipe Limited acquired New Lease/rhipe Australia Pty Ltd on 31 March 2014, there was a change in ownership of more than 50%. Therefore rhipe Limited fails the continuity of ownership test. Furthermore, rhipe Limited is now carrying on a different business, therefore cannot rely on the same business test. As a result, the revenue losses on the June 2014 tax return are foregone. No other Australian tax losses are unrecognised.

Overseas revenue tax losses of $473,000 are not being recognised as deferred tax assets as it is not considered probable that these will be recoverable.

Note 6 Earnings per Share


cents cents

Basic EPS (1.98) 0.51

Diluted EPS (1.98) 0.50 Net profit attributable to ordinary equity holders of the parent: $000 $000

(a) Reconciliation of earnings to profit or loss

Profit (2,321) 884

Earnings used to calculate basic EPS (2,321) 884

Earnings used in the calculation of dilutive EPS (2,321) 884 2015

No.of Shares 2014

No. of Shares

(b) Weighted average number of ordinary shares outstanding during the year used in calculating basic EPS 117,317,393 174,694,609

Weighted average number of dilutive options outstanding - 1,727,379

W e i gh t e d average number of ordinary shares outstanding during the year used in calculating dilutive EPS 117,317,393 176,421,988

In calculating prior year earnings per share, the company has applied the methodology set out in AASB 3 to take account of the reverse acquisition of NewLease Pty Ltd as discussed in Note 1 (c)

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Note 7 Cash and Cash Equivalents


$000 $000

Cash at bank and on hand 12,388 4,324

Short-term bank deposits 35 133

12,423 4,457 The effective interest rate on short-term bank deposits was 1.90% (2014: 4.28%); these deposits have an average maturity of 31 days.

Note 8 Trade and Other Receivables


Note $000 $000

CURRENT

Trade receivables 16,864 7,683

Provision for impairment 8(c)(ii) (104) -

Accrued revenue 10,572 7,378

27,332 15,061 There is one Australian customer representing 16.4% of the total balance of trade receivables. The balance amounts to $2.8 million of which $2.5 million relates to unearned revenue for advance subscription. No other customers represent more than 5% of trade receivables. (a) Provision For Impairment of Receivables

Movement in provision for impairment of receivables is as follows:

CONSOLIDATED GROUP

OPENING BALANCE

1 JUL 2013 $000

CHARGE FOR THE YEAR

$000

AMOUNTS WRITTEN

OFF 30 JUN 2014

$000

CLOSING BALANCE 30

JUN 2014 $’000

(i) Current trade receivables 50 (50) - -

50 (50) - -

CONSOLIDATED GROUP

OPENING BALANCE

1 JUL 2014 $000

CHARGE FOR

THE YEAR $000

AMOUNTS

WRITTEN OFF 30 JUN 2015

$000

CLOSING

BALANCE 30 JUN 2015 $’000

(ii) Current trade receivables - 143 (39) 104

- 143 (39) 104

Credit risk

The Group has no significant concentration of credit risk with respect to any single counter party or group of counter parties other than those receivables specifically provided for and mentioned within Note 8. Trade and Other Receivables is considered to be the main source of credit risk related to the Group. On a geographic basis, the Group has significant credit risk exposures in Australia, Singapore, New Zealand, Philippines, Thailand, Malaysia, Indonesia and United States given the substantial operations in those regions. The Group’s exposure to credit risk for receivables at the end of the reporting period in those regions is as follows:

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GROSS

AMOUNT

$000

PAST DUE

AND

IMPAIRED

$000

PAST DUE BUT NOT IMPAIRED (DAYS OVERDUE) WITHIN

INITIAL

TERMS

$000

<30

$000

31-60

$000

>60

$000

15,061

-

1,877

385

336

12,463

15,061 - 1,877 385 336 12,463

GROSS

AMOUNT

$000

PAST DUE

AND

IMPAIRED

$000

PAST DUE BUT NOT IMPAIRED (DAYS OVERDUE) WITHIN

INITIAL

TERMS

$000

<30

$000

31-60

$000

>60

$000

27,436 (104) 5,681 1,598 2,248 18,013

27,436 (104) 5,681 1,598 2,248 18,013



$000 $000

Australia 15,941 9,395 Singapore 5,243 2,762 New Zealand 2,995 1,258 Philippines 1,435 963 Thailand 713 661 Malaysia 332 22 Indonesia 254 - United States 419 - 27,332 15,061 The following table details the Group’s trade and other receivables exposed to credit risk (prior to collateral and other credit enhancements) with ageing analysis and impairment provided for thereon. Amounts are considered as ‘past due’ when the debt has not been settled with the terms and conditions agreed between the Group and the customer or counter party to the transaction. Receivables that are past due are assessed for impairment by ascertaining solvency of the debtors and are provided for where there are specific circumstances indicating that the debt may not be fully repaid to the Group. The balances of receivables that remain within initial trade terms (as detailed in the table) are considered to be of high credit quality. CONSOLIDATED GROUP

2015 Trade and term receivables

Total CONSOLIDATED GROUP 2014 Trade and term receivables

Total

(b) Collateral Held as Security

Included in trade debtors is an amount owing to the Group of AUD equivalent $0 at the end of the reporting period (2014: $173,000). Collateral was pledged in the form of a bank guarantee. The Group has not recognised the collateral in the financial statements as the debtor is not in default at the reporting date.

CONSOLIDATED GROUP

(c) Financial Assets Classified as Loans and Receivables

2015 2014 Note $000 $000

Trade and other Receivables

— Total current

27,332 15,061

Financial assets 26 27,332 15,061

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Note 9 Other Assets

CONSOLIDATED GROUP

2015 2014 $000 $000

CURRENT

Prepayments 2,942 245

Bonds & deposits 311 36

3,253 281

Note 10 Assets Held for Sale


$000 $000

(a) Non-current Assets Held for Sale:

Property, plant & equipment 507 507

Impairment for mine camp held for sale (157) -

350 507

(b) Liabilities associated with Assets Held for Sale

Trade and other payables 58 58

Provisions 100 100

158 158

(c) Net value of Assets Held for Sale 192 349 The Group has entered into a conditional sales agreement to sell the Mine Camp. The Group expects to recoup its net carrying value for this asset. Rhipe Limited has a mine camp which is a legacy asset prior to acquiring NewLease. At 30 June 2014, the mine camp was assessed as being ‘held for sale’ as its sale was assessed as highly probable due to a conditional sale contract being in place. The sales price agreed was for $450,000. During FY 2015, the conditional sale contract did not complete as the purchaser was unable to obtain development application approval for the mine camp to be installed permanently. Negotiations have recommenced with the purchaser, but on reduced terms, with $250,000 being the current offer. The $192,000 net carrying value of the camp includes a $58,000 accrual for the expected costs to dispose of the camp. The purchaser believes he will be able to obtain DA approval if he makes a new application with altered conditions. If the sale to the vendor does not proceed, the next option will be to decommission the mine camp and sell at auction.

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Note 11 Other Financial Assets CONSOLIDATED GROUP 2015 2014

$000 $000

NON-CURRENT

Other investments at cost 2,510 10

Total non-current assets 2,510 10 Rhipe has a 6.52% shareholding in LiveTiles Limited (formerly known as Modun Resources Limited) having paid $2.5M at the time of acquiring nSynergy in December 2014.

Note 12 Property, Plant and Equipment

CONSOLIDATED GROUP

PLANT AND EQUIPMENT: 2015 2014 $000 $000

At cost 777 316 Accumulated depreciation

(258) (145)

519 171 Movements in Carrying Amounts

Movements in carrying amounts for each class of property, plant and equipment between the beginning and the end of the current financial year. PLANT AND

EQUIPMENT

$000

TOTAL

$000

Consolidated Group:

Balance at 1 July 2013 197 197

Additions 31 31

Depreciation Expense (57) (57)

Balance at 30 June 2014 171 171

Additions 407 407

Acquisition of subsidiary 14 14

Depreciation expense (73) (73)

Balance at 30 June 2015 519 519

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Note 13 Intangible Assets

CONSOLIDATED GROUP

2015 2014 $000 $000

Goodwill

Cost 22,518 5,549

Accumulated impaired losses - -

Net carrying amount 22,518 5,549

Trademarks and licences

Cost 10 10

Accumulated impaired losses - -

Net carrying amount 10 10

Capitalised development

Cost 702 358

Accumulated amortisation (148) (41)

Net carrying amount 554 317

Total intangibles 23,082 5,876 Consolidated Group:

GOODWILL TRADEMARKS &

LICENCES

CAPITALISED

DEVELOPMENT

Note $000 $000 $000 Year ended 30 June 2014

Balance at the beginning of the year - 10 -

Additions - - 358

Acquisitions through business combinations 5,549 - -

Amortisation charge - - (41)

Closing value at 30 June 2014 5,549 10 317 Year ended 30 June 2015

Balance at the beginning of the year 5,549 10 317

Additions - - 346

Acquisitions through business combinations (i) 27 16,969 - -

Amortisation charge - - (109)

Closing value at 30 June 2015 22,518 10 554

Intangible assets, other than goodwill and trademarks and licences, have finite useful lives. The current amortisation charges for intangible assets are included under depreciation and amortisation expense per the statement of profit or loss. Goodwill and trademarks and licences has an indefinite useful life.

(a) Comprises AUD $3M in deferred consideration which will be reversed to reflect the amendment to the

nSynergy acquisition agreement subsequent to year end. For

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Impairment

Goodwill is allocated to cash-generating units which are based on the group’s reporting segments.

2015 2014 $000 $000

Asia Pacific segment 22,518 5,549

Total

22,518 5,549

Goodwill impairment testing

The recoverable amount of the Asia Pacific segment, the only cash generating unit to which goodwill is recognised at 30 June 2015, was calculated on the basis of value in use using a discounted cash flow model. Management has based the value-in-use calculations on board approved budgets for the 2016 financial year for the cash generating unit. This budget is adjusted for future years and uses an initial growth rate of 35% decreasing over five years to a terminal growth of 5% and a real pre-tax discount rate of 13.25% (30 June 2014: 13.25%). The terminal growth rate is determined based on the long-term anticipated growth rate of the business. The forecast financial information is based on both past experience and future expectations of CGU performance. The major inputs and assumptions used in performing an impairment assessment that require judgement include revenue forecasts, operating cost projections, customer numbers and customer churn, discount rates and growth rates. During the year ended 30 June 2015, no impairment arose as a result of the review of goodwill. The recoverable amount of the Asia Pacific CGU is greater than the carrying amount and, based on sensitivity analysis performed, no foreseeable changes in the assumptions would cause the carrying amount of the CGU to exceed its recoverable amount.

Note 14 Trade and Other Payables

CONSOLIDATED GROUP

2015 2014 Note $000 $000

CURRENT

Unsecured liabilities

Trade payables 12,222 8,500

Sundry payables and accrued expenses 11,185 6,384

Credit card payable (2) 50

Indirect taxes 455 1,258

Total trade and other payables 23,860 16,192

Unearned Revenue 2,715 727

Employee Benefits 756 243

27,331 17,162

(a) Financial liabilities at amortised cost classified as trade and other payables

Trade and other payables, unearned revenue and employee benefits

— Total current 27,331 17,162

— Total non-current - -

27,331 17,162

Less: Employee benefits (756) (243)

Less: Indirect taxes (455) (1,258)

Financial liabilities as trade and other payables 26 26,120 15,661 The average credit period on purchases is 1 month. No interest is charged on the trade payables. The Group has financial risk management policies in place to ensure that all payables are paid within the pre-agreed credit terms.

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Note 15 Tax

CONSOLIDATED GROUP

2015 2014 $000 $000

CURRENT

Income tax payable 709 527

709 527

NON-CURRENT OPENING BALANCE

RECOGNISED TO INCOME

RECOGNISED TO EQUITY

DIFFERENT TAX RATE OF SUBSIDARIES

REVENUE LOSS CANNOT BE

RECOGNISED FOR DEFFERRED TAX

ASSET

ACQUISITION OF SUBSIDIARY

EXCHANGE DIFFERENCES

CLOSING BALANCE

Consolidated Group $000 $000 $000 $000 $000 $000 $000 $000

Deferred tax liability Accrued revenue 1,362 (1,185) - - - - 9 186

Other - 19 - - - - - 19

Balance at 30 June 2014 1,362 (1,166) - - - - 9 205 Accrued revenue

186

156

-

-

-

-

4

346

Other 19 143 - - - - - 162 Balance at 30 June 2015 205 299 - - - - 4 508

Deferred tax assets

Provisions - employee benefits 138 (5) - - - - - 133

Provisions - doubtful debts 15 (15) - - - - - -

Accrued COS 988 (991) - - - - 7 4

Other 36 146 22 (13) - - 1 192

Balance at 30 June 2014 1,177 (865) 22 (13) - - 8 329

Provisions - employee benefits 133 107 - -

-

-

-

240

Provisions - doubtful debts - 30 - - - - - 30

Accrued COS 4 6 - - - - - 10

Other 192 (122) 366 165 (473) 362 - 490

Balance at 30 June 2015 329 21 366 165 (473) 362 - 770

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Note 16 Provisions

CONSOLIDATED GROUP

2015 2014 $000 $000

CURRENT


NON CURRENT


Provision for Employee Benefits Provision for employee benefits represents amounts accrued for annual leave and long service leave. The non-current portion for this provision includes amounts accrued for long service leave entitlements that have not yet vested in relation to those employees who have not yet completed the required period of service. The probability of long service leave being taken is based on historical data. The measurement and recognition criteria relating to employee benefits have been included in Note 1(m).

Note 17 Issued Capital

RHIPE LIMITED

2015 2014 $000 $000

132,799,948 (2014: 95,880,435) fully paid ordinary shares 38,714 8,103

38,714 8,103 (a) Movement in ordinary shares on issue RHIPE LIMITED

No. VALUE $’000

rhipe Limited shares as at 30 June 2014 95,880,435 8,103 Shares issued upon exercise of $0.20 options 3,870,177 774 Transfer from equity settled employee benefits reserve upon exercise of options - 112 Shares issued 33,049,336 30,478 Share issue costs, net tax - (753) Closing balance at 30 June 2015 132,799,948 38,714

In disclosing the share capital for the prior year the requirements of AASB 3 paragraph B21 have been applied. This paragraph specifically requires share capital to be retroactively adjusted to reflect the share capital of the legal acquirer, which in this case is rhipe Limited. Ordinary shares participate in dividends and the proceeds on winding-up of the parent entity in proportion to the number of shares held. At the shareholders’ meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands. Ordinary shares have no par value and the company does not have a limited amount of authorised capital. (b) Options

(i) For information relating to the rhipe Limited (formerly Rhype Limited) employee option plan, including details of options issued, exercised and lapsed during the financial year and the options outstanding at year-end. Refer to Note 19: Share-based Payments.

(ii) For information relating to equity instruments issued to key management personnel during the financial year. Refer to Note 19: Share-based Payments.

As at 30 June 2015, there were 8,397,500 unissued ordinary shares under option (30 June 2014: 10,751,427). These options are exercisable as follows:

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DETAILS NUMBER OF OPTIONS DATE OF EXPIRY CONVERSION PRICE ($)

Management incentive options issued prior to completion of reverse takeover by NewLease Pty Ltd 1,187,500 12/03/2016 0.20

1,437,500 12/03/2018 0.20

Management incentive options

2,125,000

10/04/2017

0.20

2,125,000 10/04/2019 0.20

300,000 11/08/2018 0.75

300,000 11/08/2020 0.75

67,500 15/09/2018 0.75

67,500 15/09/2021 0.75

67,500 01/10/2018 0.75

67,500 01/10/2021 0.75

200,000 01/07/2018 0.75

200,000 01/07/2021 0.75

126,250 18/03/2017 1.25

126,250 18/03/2018 1.25

8,397,500

2015

2014

No. Of Options No. Of Options

Balance at beginning of the year 10,751,427 -

Existing rhipe Limited options on issue - 7,981,602

Granted during the year 1,522,500 4,250,000

Exercised during the year (3,870,177) (1,480,175)

Expired during the year (6,250) -

Balance at end of year 8,397,500 10,751,427

(c) Performance rights As at 30 June 2015, there were 1,000,000 performance rights to acquire shares (30 June 2014: Nil). These performance rights are exercisable as follows:

DETAILS NUMBER OF RIGHTS DATE OF EXPIRY CONVERSION PRICE ($)

Management performance rights 500,000 11/08/2017 Nil

500,000 11/08/2019 Nil

1,000,000 2015 2014

No. of rights No. of rights

Balance at beginning of the year - -

Granted during the year 1,000,000 -

Exercised during the year - -

Expired during the year - -

Balance at end of year 1,000,000 -

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED (d) Capital Management

Management controls the capital of the Group in order to maintain a sustainable debt to equity ratio, generate long-term shareholder value and ensure that the Group can fund its operations and continue as a going concern. The Group’s debt and capital include ordinary share capital and financial liabilities, supported by financial assets. The Group is not subject to any externally imposed capital requirements. Management effectively manages the Group’s capital by assessing the Group’s financial risks and adjusting its capital structure in response to changes in these risks and in the market. These responses include the management of debt levels, distributions to shareholders and share issues.

(e) Franking Account RHIPE LIMITED

2015 2014 $000 $000

Adjusted franking account balance 2,339 2,091

Note 18 Reserves

(a) Equity-settled employee benefits reserve

Equity-settled employee benefits reserve relates to share options granted by the Company to its employees under its employee share option plan. Further information about share based payments to employees is set out in note 19.

(b) Foreign Currency Translation Reserve

Exchange differences relating to the translation of the results and net assets of the Group’s foreign operations from their functional currencies to the Group’s presentation currency (i.e. Australian dollars) are recognised directly in other comprehensive income and accumulated in the foreign currency translation reserve. Gains and losses on hedging instruments that are designated as hedging instruments for hedges of net investments in foreign operations are included in the foreign currency translation reserve. Exchange differences previously accumulated in the foreign currency translation reserve (in respect of translating both the net assets of foreign operations and hedges of foreign operations) are reclassified to profit or loss on the disposal of the foreign operation.

(c) General Reserve

The general reserve is used from time to time to transfer profits from retained earnings for appropriation purpose. There is no policy of regular transfer. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to profit or loss.

Note 19 Share-based Payments The Group has an ownership-based compensation scheme for executives and senior employees. In accordance with the terms of the plan, as approved by shareholders at a previous annual general meeting, executives and senior employees of the Group may be granted options to purchase ordinary shares. Each employee share option converts into one ordinary share of rhipe Limited on exercise. No amounts are paid or payable by the recipient on receipt of the option. The options carry neither rights to dividends nor voting rights. Options may be exercised at any time from the date of vesting to the date of their expiry. The number of options granted is determined by the Board. A summary of the movements of management incentive plan options issued is as follows:

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CONSOLIDATED GROUP

NUMBER

WEIGHTED AVERAGE EXERCISE PRICE

Options outstanding as at 30 June 2013 80,125,000 $0.012

Granted 5,000,000 $0.010

Recapitalisation 20:1 (80,868,750) Options outstanding post recapitalisation 4,256,250 $0.235

Granted 4,250,000 $0.200

Exercised (250,000) $0.200


Granted 1,522,500 $0.833

Exercised (1,375,000) $0.200

Expired (6,250) $24.00


Options exercisable as at 30 June 2015: 8,397,500 $0.315

Options exercisable as at 30 June 2014: 8,256,250 $0.218

As at the date of exercise, the weighted average share price of options exercised during the year was $0.20.

The weighted average remaining contractual life of options outstanding at year end was 2.26 years (2014: 3.26 years). The exercise price of outstanding options at the end of the reporting period was $0.20 - $1.25.

There has been no alteration to the terms and conditions of any share-based payments arrangements since the grant date.

On 29 July 2014, 600,000 share options were granted to Dominic O’Hanlon under the rhipe Limited (formerly Rhype Limited) management incentive plan, approved at the annual general meeting on 28 November 2014, to take up ordinary shares at an exercise price of $0.75 each. Half the options vest after the Company’s share price has traded at $1.00 or above for 20 business days (using 20 day VWAP) and one year service. If options vest, expire three years from vesting date. The balance of the options vest after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP) and two years service. If the options vest they expire five years from the vesting date.

On 27 February 2015, 670,000 share options were granted to employees under the rhipe Limited (formerly Rhype Limited) management incentive plan to take up ordinary shares at an exercise price of $0.75 each. Half the options vest after the Company’s share price has traded at $1.00 or above for 20 business days (using 20 day VWAP) and one year service. If options vest, expire three years from vesting date. The balance of the options vest after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP) and two years service. If the options vest they expire five years from the vesting date. The options hold no voting or dividend rights and are transferable.

On 18 March 2015, 252,500 share options were granted to employees under the rhipe Limited (formerly Rhype Limited) management incentive plan to take up ordinary shares at an exercise price of $1.25 each. Half the options vest after the Company’s share price has traded at $1.50 or above for 20 business days (using 20 day VWAP) and two years’ service. The balance of the options vest after the Company’s share price has traded at $1.75 or above for 20 business days (using 20 day VWAP) and three years’ service. The options hold no voting or dividend rights and are transferable.

Options are forfeited after the holder ceases to be employed by the Group, unless the Board determines otherwise (this is usually only in the case of redundancy, death or disablement).

Fair value of share options granted in the year

The fair value of the options granted to employees is considered to represent the value of the employee services received over the vesting period.

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The weighted average fair value of options granted during the year was $0.4713 (2014: $0.4465). These values were calculated using the Black Scholes option pricing model. Where relevant, the expected life used in the model has been adjusted using management’s best estimate for the effects of non-transferability, exercise restrictions (including the probability of meeting market conditions attached to the option), and behavioural considerations.

No. of options 300,000 300,000 335,000 335,000 126,250 126,250

Grant date 29/07/2014 29/07/2014 27/02/2015 27/02/2015 18/03/2015 18/03/2015

Share price at grant date $0.82 $0.82 $1.29 $1.29 $1.32 $1.32

Exercise price $0.75 $0.75 $0.75 $0.75 $1.25 $1.25

Risk-free interest rate 2.70% 2.98% 1.79% 1.93% 1.85% 1.93%

Expiry date 11/08/2015 11/08/2016 12/08/2017 to 12/09/2017

12/08/2017 to

12/09/2017

18/03/2017 18/03/2018

Volatility 50% 50% 52% 52% 53% 53%

Vesting conditions (a) (b) (a) (b) (c) (d)

Weighted average value per option before discounting for market based vesting conditions

0.3219 0.4039 0.7267 0.8454 0.4294 0.5153

Discount rate 40% 50% - - 25% 50%

Weighted average value per option after discounting for market based vesting conditions

0.1931 0.2020 0.7267 0.8454 0.3221 0.2576

Further discount as options unlisted and non-transferable

20% 20% - - - -

Weighted average value per option 0.1545 0.1616 0.7267 0.8454 0.3221 0.2576

(a) Vest only after the Company’s share price has traded at $1.00 or above for 20 business days (using 20 day VWAP) and one year service. If options vest, expire three years from vesting date.

(b) Vest only after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP) and 2 years service. If options vest, expire five years from vesting date.

(c) Vest only after the Company’s share price has traded at $1.50 or above for 20 business days (using 20 day VWAP) and 2 years service.

(d) Vest only after the Company’s share price has traded at $1.75 or above for 20 business days (using 20 day VWAP) and 3 years service.

The last 12 months of historical share price volatility has been the basis for determining expected share price volatility as it is assumed that this is indicative of future volatility. The life of the options is based on the historical exercise patterns, which may not eventuate in the future. (i) Performance Rights

On 29 July 2014, 1,000,000 performance rights were granted to Dominic O’Hanlon as part of the equity incentive plan approved at the annual general meeting on 28 November 2014. Half the performance rights vest after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP) and three years service. The balance vest after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP) and five years service.

The fair value of the performance rights has been determined using the following assumptions:

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No. of performance rights 500,000 500,000

Grant date 29/07/2014 29/07/2014

Share price at grant date $0.82 $0.82

Vesting conditions (a) (b)

Risk-free interest rate 2.70% 2.98%

Value per option before discounting for market based vesting conditions

0.82 0.82

Discount rate 50% 50%

Value per option after discounting for market based vesting conditions

0.410 0.410

Further discount as options unlisted and non transferable 20% 20%

Value per option 0.328 0.328

(a) Vest only after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP) and three years service.

(b) Vest only after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP) and five years service

(ii) Shares Issued to Dominic O’Hanlon with Loan

On 29 July 2014, the Company issued 2,400,000 shares to Dominic O’Hanlon via a loan which was approved at the annual general meeting on 28 November 2014. The effect of this arrangement is equivalent to granting the executive with an option to purchase 2,400,000 shares at $0.70 each. Vest only after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP), and in three equal tranches over the escrow periods of 18, 36 & 54 months.

The effect of this arrangement is equivalent to granting the executive with an option to purchase 2,400,000 shares at $0.70 each. The Company has determined the fair value using the following assumptions:

No. of shares 2,400,000

Grant date 29/07/2014

Share price at grant date $0.82

Share price per non-recourse loan $0.70

Risk-free interest rate 2.98%

Volatility 50%

Vesting conditions (a)

Value per option before discounting for market based vesting conditions

0.4201

Discount rate 50%

Value per option after discounting for market based vesting conditions

0.2100

Further discount as options unlisted and non transferable 20%

Value per option 0.1680

(a) The shares only vest after the Company’s share price has traded at $1.20 or above for 20 business days (using 20 day VWAP), and in three equal tranches over the escrow periods of 18, 36 & 54 months

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Note 20 Cash Flow Information

CONSOLIDATED GROUP

2015 2014 $000 $000

(a) Reconciliation of Cash Flow from Operating Activities with Profit after Income Tax

Profit after income tax (2,321) 884

Cash flows excluded from profit attributable to operating activities

Non-cash flows in profit:

Share based payments expense 1,787 310

Amortisation 109 41

Depreciation 73 57

Reversal of impairment loss on trade receivable - (50)

Others 188 36

Net foreign exchange gain or loss (288) (86)

Provision for doubtful debt 104 -

Impairment of asset held for sale 157 -

Changes in operating assets and liabilities:

(Increase) in trade and term receivables (11,074) (3,618)

(Increase) in other current assets (2,964) (135)

Increase in trade payables and accruals 9,182 4,518

(Decrease)/increase in income taxes payable (206) 628

Increase/(decrease) in deferred taxes payable 303 (1,157)

(Decrease)/Increase in deferred taxes receivable (79) 875

(Decrease)/increase in provisions (138) 44

Cash flow from operating activities (5,167) 2,347 (b) The bond facilities agreement for the guarantee for EFIC

The bond facility agreement for the guarantee from EFIC support was first executed on 15 July 2014 for the facility limit AUD 1,000,000. The availability period is the period starting on the date of this bond facility agreement and ending on its first anniversary. The agreement has been renewed for another year on the first anniversary in July 2015 for the facility limit of USD 712,000.

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Note 21 Interests in Subsidiaries (a) Information about Principal Subsidiaries

The subsidiaries listed below have share capital consisting solely of ordinary shares or ordinary units which are held directly by the Group. The proportion of ownership interests held equals the voting rights held by Group. Each subsidiary’s principal place of business is also its country of incorporation.

OWNERSHIP INTEREST HELD BY GROUP

PROPORTION OF NON-CONTROLLING INTEREST

NAME OF PRINCIPAL PLACE 2015 2014 2015 2014 SUBSIDIARY OF BUSINESS (%) (%) (%) (%)

rhipe Australia Pty Ltd (i)(vi) (formerly NewLease Pty Ltd)

Australia 100% 100% - -

rhipe Dynamics Pty Ltd (vi) (formerly NewLease Dynamics Pty Ltd)

Australia 100% 100% - -

NewLease G2M Pty Ltd (iii) Australia 63% 63% 37% 37%

FRR Services Australia Pty Ltd (vi) Australia 100% 100% - -

rhipe New Zealand Limited (formerlyNewLease Software Limited)

New Zealand 100% 100% - -

rhipe Singapore Pte. Ltd (formerly NewLease Pte Ltd)

Singapore 100% 100% - -

rhipe Technology (Thailand) Co., Ltd (ii) (formerly NewLease (Thailand) Co., Ltd)

Thailand 100% 100% - -

rhipe Malaysia Sdn Bhd (formerly NewLease Malaysia Sdn. Bhd)

Malaysia 100% 100% - -

NewLease Hong Kong Limited (iii) Hong Kong 100% 100% - -

rhipe Philippines, Inc (formerly NewLease Philippines, Inc)

Philippines 100% 100% - -

PT rhipe International Indonesia (iv) (formerly PT NewLease International Indonesia)

Indonesia 100% - - -

rhipe Cloud Solutions Pty Ltd (v)(vi) (formerly nSynergy OSC Holdings Pty Ltd)

Australia 100% - - -

rhipe Solutions Australia Pty Ltd (v)(vi) (formerly nSynergy OSC Pty Ltd)

Australia 100% - - -

rhipe Solutions LLC (formerly Online SC LLC) (v) United States 100% - - -

nSynergy Shanghai Information Technology Co., Ltd (v) China 100% - - -

Subsidiary financial statements used in the preparation of these consolidated financial statements have also been prepared as at the same reporting date as the Group’s financial statements. (i) This wholly-owned subsidiary has entered into a deed of cross guarantee with rhipe Limited pursuant to

ASIC Class Order 98/1418 and is relieved from the requirement to prepare and lodge an audited financial report.

(ii) This wholly-owned subsidiary has entered into a deed of cross guarantee with rhipe Australia Pty Ltd (iii) This company is dormant. (iv) The Company incorporated PT rhipe International Indonesia (formerly PT NewLease International Indonesia)

on 23 July 2014. (v) The Company acquired rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd) and its

subsidiaries on 15 December 2014. (vi) These companies are part of the Australian tax consolidated group.

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED (b) Significant Restrictions

There are no significant restrictions over the Group’s ability to access or use assets, and settle liabilities, of the Group.

(c) Deed of Cross Guarantee

The consolidated income statement and consolidated statement of financial position of the entities party to the deed of cross guarantee are: CONSOLIDATED GROUP

Financial information in relation to:

2015 2014 $000 $000

(i.) Statement of Profit or Loss and Other Comprehensive Income:

Profit/(Loss) before income tax (443) 931

Income tax expense (667) (379) Profit/(Loss) after income tax (1,110) 552

Profit/(Loss) attributable to members of the parent entity (1,110) 552

(ii.) Retained Earnings:

Retained losses at the beginning of the year (207) (759) Profit after income tax (1,110) 552

Retained losses at the end of the year (1,317) (207)

Statement of Financial Position:

CURRENT ASSETS

Cash and cash equivalents 11,010 2,908

Trade and other receivables 14,840 9,338

Other assets 3,207 268 TOTAL CURRENT ASSETS 29,057 12,514

NON-CURRENT ASSETS

Other financial assets 19,770 331

Loans receivable 5,694 2,036

Property, plant and equipment 498 168

Deferred tax assets 626 271

Intangible assets 6,112 5,876 TOTAL NON-CURRENT ASSETS 32,700 8,682

TOTAL ASSETS 61,757 21,196

CURRENT LIABILITIES

Trade and other payables 18,507 12,275

Current tax liability 581 345

Deferred settlement 3,000 - TOTAL CURRENT LIABILITIES 22,088 12,620

NON-CURRENT LIABILITIES

Deferred tax liabilities 249 186

Other provisions 73 211

TOTAL NON-CURRENT LIABILITIES 322 397

TOTAL LIABILITIES 22,410 13,017

NET ASSETS 39,347 8,179

EQUITY

Issued capital 38,714 8,103

Reserves 1,950 283

Retained earnings (1,317) (207)


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Note 22 Related Party Transactions Related Parties

(a) The Group’s main related parties are as follows:

i. Key Management Personnel: Any person(s) having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any director (whether executive or otherwise) of that entity are considered key management personnel.

Refer to the Remuneration Report contained in the Directors’ Report for details of the remuneration paid or payable to each member of the Group’s key management personnel (KMP) for the year ended 30 June 2014.

The totals of remuneration paid to KMP of the company and the Group during the year are as follows:


$000 $000

Short-term employee benefits 2,809 701

Post-employment benefits 150 47

Other long term benefits - -

Termination benefits - 43

Share-based payments 1,522 450

Total KMP compensation 4,481 1,241 Further information in relation to KMP remuneration can be found in the Remuneration Report.

ii. Other Related Parties Other related parties include entities controlled by the ultimate parent entity, entities over which key management personnel have joint control, and entities that directors are common directors of.

(b) Transactions with related parties:

Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated.

The following transactions occurred with related parties:

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED CONSOLIDATED GROUP

2015 2014 $000 $000

I. Other Related Parties Purchase of services:

Arrangement fee paid to MSP Services Pty Ltd, a company controlled by Mark Pierce - 14 Legal fees paid to Corrs Chambers Westgarth, an entity related to Philip Kapp

- 115

Invoice paid to Reunion Investment Pty Ltd, a company controlled by Michael Everett 59 -

Arrangement fees paid to Kappfam Investment Pty Ltd, an entity related to Philip Kapp

10 -

Recharge of services: Director fees charged to LiveTiles 27 -

Recharge of service from nSynergy Shanghai Information Technology Co.Ltd to rhipe Solutions Australia Pty Ltd 428 -

Recharge of share services from rhipe Solutions Australia Pty Ltd to LiveTiles 298 II. Key Management Personnel

Interest revenue:

Interest received from directors - 8

iii. LiveTiles Holdings Pty Ltd

During the period, the Company made a $2.5 million investment in LiveTiles Holdings Pty Ltd for a 12.5% interest. As part of this transaction, Mike Hill was appointed to the board of LiveTiles Holdings Pty Ltd. Subsequently, Modun Resources Limited, a Company related to Mike Hill, has made a conditional offer to acquire 100% of the issued capital of LiveTiles Holdings Pty Ltd via the issue of 225,000,000 shares in Modun Resources Limited at $0.15 per share. The shares were consolidated and then relisted at $0.15 per share as LiveTiles Limited (ASX:LVT).

Amounts outstanding from related parties CONSOLIDATED GROUP

2015 2014 $000 $000

Loans to Key Management Personnel: Beginning of the year - 195 Loan advanced - 11 Loan repayment received - (206) Interest charged - 8 Interest received - (8) End of the year - -

Prior to the reverse acquisition, the Group had provided loans to directors. The loans were unsecured and bear an interest rate equivalent to the benchmark interest rate as given by Section 109(2) of the Australian Income Tax Assessment Act. These loans were repaid prior to rhipe Limited acquiring NewLease Pty Ltd.

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Note 23 Auditors’ Remuneration


$000 $000

Remuneration of the auditor for:

— auditing or reviewing the financial report 194 139

— taxation services 50 7

— due diligence investigations

- 67

244 213 Remuneration of other auditors of subsidiaries for:

— auditing or reviewing the financial statements of subsidiaries 21 6

Note 24 Capital and Leasing Commitments

CONSOLIDATED GROUP

2015 2014 $000 $000

(a) Operating Lease Commitments Non-cancellable operating leases contracted for but not recognised in the financial statements

Payable — minimum lease payments

— not later than 12 months 526 241

— between 12 months and five years 1,314 427

1,840 668 The Melbourne property lease for Level 2 and 5 is a non-cancellable lease with a five-year term commencing 16th August 2012, with rent payable monthly in advance. Contingent rental provisions within the lease agreement require that minimum lease payments shall be increased by 4% per annum. An option exists to renew the lease at the end of the term for an additional term of five years. Due to increase in staff related to the acquisition of rhipe Solutions Pty Ltd, the Melbourne office has entered a new lease of an additional suite located within the same building on Level 5. The new lease is a non-cancellable lease with a two year, four months and sixteen days term commencing 30th March 2015, with rent payable monthly in advance. Contingent rental provisions within the lease agreement require that minimum lease payments shall be increased by 4% per annum. An option exists to renew the lease at the end of the term for an additional term of five years. Due to increase in staff related to the acquisition of rhipe Solutions Pty Ltd, the Sydney office has been relocated from previous location on Level 23 to a larger suite on Level 19 in the same building. The previous lease has been surrendered by the lessor with a new lease which is a non-cancellable lease with a five year term commencing 1st May 2015, with rent payable monthly in advance. Contingent rental provisions within the lease agreement require that minimum lease payments shall be increased by 4% per annum.

Note 25 Contingent Liabilities and Contingent Assets There were no contingent assets or liabilities as at 30 June 2015.

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Note 26 Financial Risk Management

The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in the accounting policies to these financial statements, are as follows:

CONSOLIDATED GROUP

2015 2014 Note $000 $000

Financial Assets

Cash and cash equivalents 7 12,423 4,457 Receivables 8c 27,332 15,061 Bonds & deposits 9 311 36 Unlisted investment 11 2,510 10 Total Financial Assets

42,576 19,564 Financial Liabilities Financial liabilities at amortised cost Trade and other payables and unearned revenue 14a 26,120 15,661 Total Financial Liabilities 26,120 15,661

Financial Risk Management Policies Specific Financial Risk Exposures and Management The main risks the Group is exposed to through its financial instruments are credit risk, liquidity risk and market risk consisting of interest rate risk and foreign currency risk. There have been no substantive changes in the types of risks the Group is exposed to, how these risks arise, or the Board’s objectives, policies and processes for managing or measuring the risks from the previous period.

a. Credit risk

Although the group’s clients are largely creditworthy, exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract obligations that could lead to a financial loss to the Group.

Credit risk is managed through the maintenance of procedures (such procedures include the review of customer business activities, regular monitoring of exposures and monitoring of the financial stability of significant customers and counterparties), ensuring to the extent possible, that customers and counterparties to transactions are of sound credit worthiness. Such monitoring is used in assessing receivables for impairment. Depending on the division within the Group, credit terms are generally 14 to 30 days from the invoice date.

Risk is also minimised through investing surplus funds in financial institutions that maintain a high credit rating. Credit Risk Exposures

The maximum exposure to credit risk by class of recognised financial assets at the end of the reporting period, excluding the value of any collateral or other security held is equivalent to the carrying amount and classification of those financial assets (net of any provisions) as presented in the statement of financial position. Credit risk also arises through the provision of financial guarantees, as approved at Board level, given to parties securing the liabilities of certain subsidiaries (refer Note 21(c) for details).

Collateral held by the Group securing receivables is detailed in Note 8(b).

The Group has no significant concentration of credit risk with any single counterparty or group of counterparties. However, on a geographic basis, the Group has significant credit risk exposures to Australia, New Zealand, Singapore, Thailand, Philippines and Malaysia given the substantial operations in those regions. Details with respect to credit risk of Trade and Other Receivables is provided in Note 8.Trade and other receivables that are neither past due or impaired are considered to be of high credit quality. Aggregates of such amounts are as detailed at Note 8.

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED b. Liquidity risk

Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise meeting its obligations related to financial liabilities. The Group manages this risk through the following mechanisms:

• preparing forward-looking cash flow analyses in relation to its operating, investing and financing activities;

• obtaining funding from a variety of sources;

• maintaining a reputable credit profile;

• managing credit risk related to financial assets;

• only investing surplus cash with major financial institutions; and

• comparing the maturity profile of financial liabilities with the realisation profile of financial assets The table below reflects an undiscounted contractual maturity analysis for financial liabilities. Cash flows realised from financial assets reflect management’s expectation as to the timing of realisation. Actual timing may therefore differ from that disclosed. The timing of cash flows presented in the table to settle financial liabilities reflect the earliest contractual settlement dates and do not reflect management’s expectations that banking facilities will be rolled forward.

Financial liability and financial asset maturity analysis

WITHIN 1 YEAR 1 TO 5 YEARS OVER 5 YEARS TOTAL 2015 2014 2015 2014 2015 2014 2015 2014 Consolidated Group $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Financial liabilities due for payment Trade and other payables and unearned revenue

26,120 15,661 - - - - 26,120 15,661

Total expected outflows 26,120 15,661 - - - - 26,120 15,661

WITHIN 1 YEAR 1 TO 5 YEARS OVER 5 YEARS TOTAL 2015 2014 2015 2014 2015 2014 2015 2014 Consolidated Group $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Financial Assets - cash flows realisable Cash and cash equivalents 12,423 4,457 - - - - 12,423 4,457

Trade and other receivables 27,332 15,061 - - - - 27,332 15,061

Bonds and deposits 311 36 - - - - 311 36

Other investments - - - - 10 10 10 10

Total anticipated inflows 40,066 19,554 - - 10 10 40,076 19,564

Net inflow on financial instruments

13,946 3,893 - - 10 10 13,956 3,903

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c. Market Risk

i. Interest rate risk

Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the end of the reporting period whereby a future change in interest rates will affect future cash flows or the fair value of fixed rate financial instruments. The Group’s exposure to the risk of changes in market interest rates related primarily to the Group’s cash at bank balances with floating interest rates.

ii. Foreign exchange risk

The Group has invested in businesses in New Zealand, Singapore (functional currency USD), Thailand, Philippines, Indonesia and Malaysia. Exposure to foreign exchange risk may result in the fair value or future cash flows of a financial instrument fluctuating due to movement in foreign exchange rates of currencies in which the Group holds financial instruments which are other than the AUD functional currency of the Group.

With instruments being held by overseas operations, fluctuations in the US Dollar, New Zealand Dollar, Thai Baht, Philippine Peso, Indonesian Rupiah and Malaysian Ringgit may impact on the Group’s financial results unless those exposures are appropriately hedged. The Group has not hedged its exposure to the above currencies.

The following table shows the foreign currency risk on the financial assets and liabilities of the Group’s operations denominated in currencies other than the functional currency of the operations. The foreign currency risk in the books of the parent entity is considered immaterial and is therefore not shown.

2015 2014 NET FINANCIAL ASSETS IN CONSOLIDATED GROUP $’000 $’000 Functional currency of entity Australian Dollars

12,682

1,739

US Dollars 1,415 1,032

NZ Dollars 1,346 532

Other 1,013 600

Statement of financial position exposure 16,456 3,903 Foreign currency sensitivity analysis

The Group is mainly exposed to the US Dollar and New Zealand Dollar.

The following table details the Group’s sensitivity to a 10% increase and decrease in the Australian dollar against the relevant foreign currencies. 10% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonable possible change in foreign exchange rates.

USD NZD 2015 2014 2015 2014 $000 $000 $000 $000

Profit or loss 141 103 135 53

Equity (59) 31 (10) 32

d. Fair Value

The directors consider that the carrying amounts of financial assets and financial liabilities recognised in the consolidated financial statements approximate their fair values except for the investment in LiveTiles Holdings Pty Ltd. Subsequent to 30 June 2015 LiveTiles Holdings was listed on the ASX. Based on the listing price per share of $0.15, the investment is now worth $3.67M. As the investment was unlisted and the transaction was conditional at 30 June 2015 in accordance with the Group’s accounting policies no fair value uplift was recognised. As the investment is now listed the Group will measure the investment as a level one fair value financial instrument in future financial periods. Any fair value uplift will be recognised in equity.

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Note 27 Business Combinations

(a) Subsidiaries acquired COUNTRY OF

INCORPORATION PERCENTAGE OWNED %

2015

Rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd) Australia 100%

On 15 December 2014, rhipe Limited wholly acquired rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd) and its subsidiaries. On 20th August 2015, the acquisition agreement was modified to eliminate contingent consideration and retained cash to be paid to the vendors.

CONSOLIDATED GROUP

(b) Consideration transferred

2015 $000

Cash – initial consideration 9,609 Cash – retained sum (i) 3,000 Shares issued 4,348

16,957

(i) Retained by rhipe to meet working capital requirements.

Acquisition related costs amounting to $440,955 have been excluded from the consideration transferred and have been recognised as an expense in profit or loss in the current year, within the ‘other expenses’ line item.

CONSOLIDATED GROUP

(c) Assets and liabilities assumed at date of acquisition

2015 $000

Current assets

Cash and cash equivalents 45

Trade and other receivables 1,301

Other assets 8

Non-current assets

Plant, property and equipment 14

Deferred tax assets 362

Current liabilities

Trade and other payables (1,354)

Current tax liabilities (388)

Net liabilities assumed (12) 2015 - rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd) The initial accounting for the acquisition of rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd) has only been provisionally determined at the end of the reporting period. For tax purposes, the tax values of rhipe Cloud Solutions’s assets are required to be reset based on market values of the assets. At the date of finalisation of these consolidated financial statements, the necessary market valuations and other calculations had not been finalised and they have therefore only been provisionally determined based on the directors’ best estimate of the likely tax values.

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED CONSOLIDATED GROUP

2015 $000

(d) Goodwill on acquisition Consideration transferred 16,957 Plus: fair value of identifiable net liabilities acquired 12 Goodwill 16,969 2015 - rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd) Goodwill arose in the acquisition of rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd) because the consideration paid for the combination effectively included amounts in relation to the benefit of expected synergies, revenue growth, future market development and the assembled workforce of rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd). These benefits are not recognised separately from goodwill because they do not meet the recognition criteria for identifiable intangible assets. The goodwill arising on acquisition is not expected to be deductible for tax purposes.

CONSOLIDATED GROUP

2015 $000

(e) Net cash outflow on acquisition of subsidiaries Consideration paid in cash 12,609 Less: Cash and cash equivalent balance acquired (45) 12,564 (f) Impact of acquisition on the results of the Group Included in the loss for the period is a profit before tax of $230,013 attributable to the additional business generated by rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd) and its wholly owned subsidiaries. Revenue for the period included $3,719,010 in respect of rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd) and its wholly owned subsidiaries.

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Note 28 Parent Information

The following information has been extracted from the books and records of rhipe Limited and has been prepared in accordance with Australian Accounting Standards. 2015 2014

$000 $000

STATEMENT OF FINANCIAL POSITION

ASSETS

Current Assets 14,254 1,627

Non-current Assets 33,268 13,640

47,522 15,267

LIABILITIES

Current Liabilities 3,801 187

TOTAL LIABILITIES 3,801 187

EQUITY

Issued Capital 100,943 70,444

Retained Earnings (59,588) (55,942)

Reserves 2,365 578


STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

Total loss (2,788) (1,835)

Total comprehensive income (2,788) (1,835)

Guarantees During the prior reporting period, rhipe Limited (formerly Rhype Limited) entered into a deed of cross guarantee with its subsidiary rhipe Australia Pty Ltd (formerly NewLease Pty Ltd). Rhipe Australia Pty Ltd has entered into a guarantee in relation to the debts of its subsidiary, rhipe Technology (Thailand) Co., Ltd (formerly NewLease (Thailand) Co. Ltd). Refer to Note 21(c) for further details.

Contingent liabilities At 30 June 2015, rhipe Limited (formerly Rhype Limited) had no contingent liabilities (2014: $Nil).

Contractual commitments At 30 June 2015, rhipe Limited had not entered into any contractual commitments for the acquisition of property, plant and equipment (2014: $Nil).

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Note 29 Events After the Reporting Period

On the 20th August 2015, the purchase price of nSynergy, post finalising completion accounts and agreement with the vendors, was reduced from the headline figure of $25.35m (as announced on 28th November 2014) to $14.35m which comprises: • $10m cash paid at completion in December 2014 • $4.35m stock in rhipe issued, escrowed to December 2015.

The reduction of $11m from that announced on 28th November 2014 comprises: • $3m of cash which has been retained by rhipe to meet working capital requirements, and • $8m of potential earn out for 2016 and 2017 which will be replaced by standard rhipe bonus plans for senior

team members. Rhipe acquired a 12.5% shareholding in LiveTiles Holdings Pty Ltd in December 2014 for cash consideration of $2.5m, at the same time as acquiring the nSynergy business. All the shareholders of LiveTiles Holdings Pty Ltd have since exchanged their shares for shares in ASX listed entity Modun Resources Ltd (ASX code: MOU) in a reverse take-over transaction. MOU has renamed itself LiveTiles Limited (ASX code: LVT) and will now hold and conduct the LiveTiles business. MOU also raised $12m of new capital in July 2015 at a share price of $0.15. Rhipe now holds 24,469,224 shares in LVT (6.52% of ordinary shares on issue) with a value of $3.67m based on the capital raising share price of $0.15. As at the date of this report, LVT listed on the ASX on the 18th September 2015.

Other than the above, there has not been any matter or circumstance occurring subsequent to the end of the financial year that has significantly affected, or may significantly affect the operations of the consolidated entity, the results of those operations, or the state of affairs of the consolidated entity in future financial years.

Note 30 Company Details

The registered office and principal place of business of the company is:

Rhipe Limited

Level 2, 460 Bourke Street

Melbourne VIC 3000

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Directors’ Declaration


In accordance with a resolution of the directors of rhipe Limited (formerly Rhype Limited), the directors of the company declare that:

1. The financial statements and notes, as set out on pages 31 to 75, are in accordance with the

Corporations Act 2001 and: (a) comply with Australian Accounting Standards, which, as stated in accounting policy

Note 1 to the financial statements, constitutes compliance with International Financial Reporting Standards (IFRS); and

(b) give a true and fair view of the financial position as at 30 June 2015 and of the performance for the year ended on that date of the consolidated group;

2. In the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable; and

3. The directors have been given the declarations required by section 295A of the Corporations Act 2001 from the Managing Director and Chief Financial Officer.

The company and a wholly-owned subsidiary, rhipe Australia Pty Limited, have entered into a deed of cross guarantee under which the company and its subsidiary guarantee the debts of each other.

At the date of this declaration, there are reasonable grounds to believe that the companies which are party to this deed of cross guarantee will be able to meet any obligations or liabilities to which they are, or may become, subject to by virtue of the deed.

Director Dominic O’Hanlon

Dated this 29th day of September 2015

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ShineWing Australia ABN 39 533 589 331. Liability limited by a scheme approved under Professional Standards Legislation. ShineWing Australia is an independent member of ShineWing International Limited – members in principal cities throughout the world.

INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF RHIPE LIMITED AND CONTROLLED ENTITIES (FORMERLY RHYPE LIMITED) Report on the Financial Report We have audited the accompanying financial report of Rhipe Limited and controlled entities which comprises the consolidated statement of financial position as at 30 June 2015, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity comprising the company and the entities it controlled at the year’s end or from time to time during the financial year. Directors’ Responsibility for the Financial Report The directors of the company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that is free from material misstatement, whether due to fraud or error. In Note 1, the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that the financial statements comply with International Financial Reporting Standards (IFRS). Auditor’s Responsibility Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance about whether the financial report is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Independence In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.

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Opinion In our opinion: a) the financial report of Rhipe Limited and controlled entities is in accordance with the Corporations Act 2001,

including:

i. giving a true and fair view of the consolidated entity’s financial position as at 30 June 2015 and of its performance for the year ended on that date; and

ii. complying with Australian Accounting Standards and the Corporations Regulations 2001; and

b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 1.

Report on the Remuneration Report

We have audited the remuneration report included in pages 12 to 22 of the directors’ report for the year ended 30 June 2015. The directors of the company are responsible for the preparation and presentation of the remuneration report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the remuneration report, based on our audit conducted in accordance with Australian Auditing Standards. Auditor’s Opinion In our opinion the remuneration report of Rhipe Limited for the year ended 30 June 2015 complies with section 300A of the Corporations Act 2001.

SHINEWING AUSTRALIA (formerly Moore Stephens) Chartered Accountants Rami Eltchelebi Partner Melbourne, 29 September 2015 F

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Additional Information for Listed Public Companies


The following information is current as at 10 September 2015

1. Shareholding a. Distribution of Shareholders Ordinary Shares Category (size of holding) Number of Holders Number of Shares % of Issued Capital 100,001 and Over 72 123,234,818 92.80 10,001 to 100,000 242 7,259,397 5.46 5,001 to 10,000 169 1,310,141 0.99 1,001 to 5,000 279 831,720 0.63 1 to 1,000 1,051 163,872 0.12 Total 1,813 132,799,948 100.00

b. The number of shareholdings held in less than marketable parcels is 926

c. The names of the substantial shareholders listed in the holding company’s register are: Number Shareholder Ordinary TUTUS MCDONAGH PTY LTD 24,310,730 CITICORP NOMINEES PTY LIMITED 15,244,630 HSBC CUSTODY NOMINEES (AUST) LTD 11,568,743 d. Voting Rights

The voting rights attached to each class of equity security are as follows:

Ordinary shares

– Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or by proxy has one vote on a show of hands.

e. 20 Largest Shareholders — Ordinary Shares Name

Number of Ordinary Fully Paid

Shares Held

%Held of Issued Ordinary Capital

1. TUTUS MCDONAGH PTY LTD

24,310,730

18.31

2. CITICORP NOMINEES PTY LTD 15,244,630 11.48 3. HSBC CUSTODY NOMINEES (AUST) LTD 11,568,743 8.71 4. J P MORGAN NOMINEES AUSTRALIA LTD 6,216,136 4.68 5. NATIONAL NOMINEES LTD 4,900,914 3.69 6. ABN AMRO CLEARING SYDNEY NOMINEES PTY LTD 4,741,050 3.57 7. SANDHURST TRUSTEES LTD 3,113,930 2.34 8. CAMPSMOUNT PTY LTD 2,904,476 2.19 9. UBS WEALTH MANAGEMENT AUSTRALIA NOMINEES PTY LTD 2,886,850 2.17 10. BRISPOT NOMINEES PTY LTD 2,851,381 2.15 11. DAWN EDMONDS 2,776,822 2.09 12. PRM INVESTMENTS PTY LTD 2,707,191 2.04 13. MICHAEL TIERNEY 2,707,191 2.04 14. AMP LIFT LTD 2,590,533 1.95 15. DOMINIC JOHN O’HANLON 2,400,000 1.811 16. UBS NOMINEES PTY LTD 2,186,894 1.65 17. HSBC CUSTODY NOMINEES (AUSTRALIA) LTD 2,053,922 1.55 18. RBC INVESTORS SERVICES AUSTRALIA PTY LTD 2,006,900 1.50 19. NIA TECH PTY LTD 1,978,338 1.49 20. ZTH TECH PTY LTD 1,978,338 1.49 102,124,969 76.90

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ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES CONTINUED

In addition to the registered holders of shares in RHP as shown above, rhipe Limited has current substantial shareholder notices, in 2015, from the following:

Date Holder pursuant to Notice % of voting power

26 August 2015 AMP Life Limited and AMP Capital Investors Limited 5.50%

20 August 2015 Regal Funds Management Pty Ltd 5.01% 17 August 2015 Pie Funds Management Limited 5.00%

Please note the above is provided for information purposes only and is based on information filed with ASX by the above registered holders pursuant to s671B of the Corporations Act.

2. The name of the company secretary is Andrew Whitten.

3. The address of the principal registered office in Australia is Level 2, 460 Bourke Street Melbourne Victoria, 3000. Telephone +61 3 9642 8695.

4. Registers of securities are held at the following addresses

Link Market Services Limited Level 1, 333 Collins Street Melbourne VIC 3000

Investor Enquiries: 1300 554 474 Facsimile: +61 2 9287 0303

5. Stock Exchange Listing

Quotation has been granted for all the ordinary shares of the company on all Member Exchanges of the Australian Securities Exchange Limited.

6. Unquoted Securities

Options over Unissued Shares A total of 8,397,500 options are on issue to 6 directors and 13 employees under the rhipe Limited (formerly Rhype Limited) employee option plan.

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