ACUMENTIS GROUP LIMITED - Annual Report 2019

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LandMark White Limited ABN 50 102 320 329

Annual financial statements 30 June 2019

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ANNUAL FINANCIAL REPORT – 30 JUNE 2019

Directors’ report ................................................................................................................................................................................... 2 Auditors independence declaration............................................................................................................................................... 12 Consolidated statement of profit or loss and other comprehensive income ..................................................................... 13 Consolidated balance sheet ............................................................................................................................................................. 14 Consolidated statement of changes in equity ............................................................................................................................ 15 Consolidated statement of cash flows ......................................................................................................................................... 16 Notes to the consolidated financial statements ......................................................................................................................... 17 How numbers are calculated .......................................................................................................................................................... 18 Risk ......................................................................................................................................................................................................... 34 Group structure .................................................................................................................................................................................. 39 Unrecognised items ........................................................................................................................................................................... 43 Other information .............................................................................................................................................................................. 45 Directors declaration ......................................................................................................................................................................... 60 Independent auditors report to the members ............................................................................................................................ 61 ASX additional information .............................................................................................................................................................. 66

LandMark White Limited 30 June 2019

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DIRECTORS’ REPORT

The Directors present their report together with the financial report of the Consolidated Entity, being LandMark White Limited (“the Company”) and its controlled entities, for the year ended 30 June 2019 and the auditor’s report thereon.

Directors

The Directors of the Company in office at any time during or since the end of the financial year are:

Keith Perrett	Keith Perrett brings to the board strong experience in strategy development,
Independent Director	government relations, stakeholder engagement and business development. He
Chair of the Board 25/05/18 – current	also has a strong business and government network, particularly within New South Wales & Queensland.
Non-Executive director 01/02/18 - current	He is currently Non-Executive Chairman of Silver Mines Ltd (ASX:SVL) and has previously held positions as the Chairman of the Grains Research and Development Corporation (GRDC), the National Rural Advisory Council (NRAC),
Audit & Risk Committee	the Wheat Research Foundation (WRF), and President of the Grains Council of
22/02/18 - current	Australia.
Nominations &
Remuneration Committee
22/02/18 - current
Chair of Nominations &
Remuneration Committee
25/05/18 - current
Stephen Maitland	Stephen Maitland OAM RFD has over 45 years’ experience in the banking and
Independent Director	finance industries and is currently a director of QInsure Ltd and several private
Non-Executive director	companies.
01/02/18 - current	He is an independent member of several audit and compliance committees and is
Audit & Risk Committee 22/02/18 – current	the principal of Delphin Associates, a business consultancy firm specialising in strategic planning, risk management, corporate governance and business transition.
Chair of Audit & Risk Committee 25/05/18 - current	Stephen has a degree in Economics and Masters’ degrees in Business and Law. He is a Fellow of the Australian Institute of Company Directors, CPA Australia; the Governance Institute of Australia; and a Senior Fellow of the Financial
Nominations &	Services Institute of Australia.
Remuneration Committee 22/02/18 - current	During the past 3 years, he has been a non-executive director of ASX-listed Centrepoint Alliance Ltd.
Bradley Piltz	Brad has been involved in financial and property markets since 1975 and was a
Executive Director	co-founder of LandMark White.
26/09/02 – 30/04/14	In addition to extensive experience with the Commonwealth Bank, Brad has
	acted for major corporations and government instrumentalities providing advice
Non-Executive Director	from portfolio analysis to property acquisition, disposal and tenancy
01/05/14 – current	requirements.
Nominations &	Brad has acted in court as an expert witness; is highly experienced in rental
Remuneration Committee	determinations; prepared educational valuation materials; lectured in valuation;
26/09/02 – current	and appeared on Sydney radio and television providing property market
	commentary.
Audit & Risk Committee 26/09/02 - 25/5/18	He is a fellow of the Australian Property Institute and a member of the Australian Institute of Company Directors.
12/03/19 - current	During the past 3 years, he has not acted as a director of any other Australian
	listed public company.

LandMark White Limited 30 June 2019

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Chris Coonan	In his previous role as CEO, Chris worked with and was responsible to the board
Executive Director 17/11/16 – 12/03/19	for the strategic direction of the Company and the effective implementation of strategic initiatives as well as the operations of the Consolidated Entity for all shareholders.
Chief Executive Officer 17/11/16 – 12/03/19	Chris Coonan had been employed by the Company since 2003 and had been responsible for the significant growth in the very successful residential valuation
	business.
	Chris was an Associate of the Australian Property Institute and had a proven
	track record with staff management and innovation along with a collaborative
	leadership style.
	During the past 3 years, he had not acted as a director of any other Australian
	listed public company.
Frank Hardiman	Frank was Chief Financial Officer of LMW from 28 February 2011 and Company
Executive Director 21/03/16 – 21/10/16	Secretary from 16 March 2011 until his retirement from both positions on 21 October 2017.
Non-Executive Director 22/10/16 – 12/03/19	Prior to joining the Company, Frank was Chief Financial Officer and Company Secretary of publicly listed Konekt Limited for 2 years and prior to that Chief Financial Officer for 16 years of the publicly listed PPK Group Limited (formerly
Audit & Risk Committee	Plaspak Group Limited).
28/02/17 – 12/03/19	Frank had over 23 years’ experience in Chief Financial Officer roles with listed
	public companies during which time he had been involved in numerous
	acquisitions and disposals as well as company floats.
	Frank had a Bachelor of Business Degree with an accounting major from
	University of Technology Sydney, was a registered tax agent and a Fellow of
	CPA Australia.
	During the past 3 years, he had not acted as a director of any other Australian
	listed public company.
Glen White	A co-founder of LandMark White’s practice, Glen was a registered valuer with
Non-Executive Director 26/09/02 – 12/03/19	over 40 years’ extensive experience in the real estate industry throughout Queensland and New South Wales.
Chair of the Board 01/12/16 – 25/05/18	Working in both the public and private sectors, Glen commenced his valuation career in 1968 and gained experience with the Queensland Lands Department, National Mutual Life Association and with a private valuation firm before working
Nominations &	in the Queensland practice that has become LandMark White since the 1980s.
Remuneration Committee
26/09/02 - 25/05/18	Prior to retirement, Glen was a fellow of the Australian Property Institute.
Audit & Risk Committee	During the past 3 years, he had not acted as a director of any other Australian
26/09/02 - 25/05/18	listed public company.

Directors Meetings

The number of directors’ meetings held and the number of meetings attended by each of the directors (when a director) of the Company during the financial year are:

					Nominations &	Nominations &
	Board		Audit & Risk	Committee	Remuneration	Committee
Director	Held	Attended	Held	Attended	Held	Attended
Keith Perrett	42	42	4	4	1	1
Stephen Maitland	42	40	4	4	1	1
Brad Piltz	42	40	-	-	1	1
Chris Coonan	18	18	-	-	-	-
Frank Hardiman	18	17	4	4	-	-
Glen White	18	14	-	-	-	-

LandMark White Limited 30 June 2019

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Company particulars

LandMark White Limited is incorporated in Australia.

The address of the registered office is Level 6, 55 Clarence Street, Sydney, NSW 2000.

Corporate Governance Statement

LandMark White Limited and the board are committed to achieving and demonstrating the highest standards of corporate governance. LandMark White Limited has reviewed its corporate governance practices against the Corporate Governance Principles and Recommendations (3rd edition) published by the ASX Corporate Governance Council.

The 2019 Corporate Governance Statement is dated as at 30 June 2019 and reflects the corporate governance practices in place at the end of the 2019 financial year. The 2019 Corporate Governance Statement was - approved by the board on 15 August 2019 and can be viewed at https://www.lmw.com.au/investor - center/corporate governance/

Principal activities

The principal activity of the Consolidated Entity during the course of the financial year was property valuation. There were no significant changes in the nature of the activities of the Consolidated Entity during the year.

Review of operations

The financial results of the business were adversely impacted by the suspension from valuation panels operated by many of the LMW’s clients following the data disclosure incidents detected on 4 February 2019 and on 29 May 2019. This has resulted in a reduction in revenues of $6-7M and a corresponding reduction in profits. Whilst LMW had insurance cover in place, this only covered a relatively small part of the losses incurred.

As a result of these incidents, LMW incurred significant response and remediation costs and has subsequently invested heavily in enhancing its IT platforms, hardware and software security as well as privacy and data policies, training and data recovery plans.

LMW is recovering from the second incident and expects to return to profitable trading from quarter two in FY2020.

In addition to the loss of revenue and resulting impact on profitability, LMW has booked impairment losses on its goodwill intangible assets due to the cash generating units supporting these assets now forecasting reduced cashflows.

Business Overview

Prior to the data incidents, LMW successfully completed the acquisition of the Taylor Byrne Holdings Pty Ltd. This was in line with the strategy of diversification of revenue streams by broadening LMW’s geographical footprint across regional QLD and NSW and introducing rural property valuation clients to the group. The acquisition also allowed LMW to reduce its reliance on sub-contract valuers in performing its large national valuation contracts.

Outlook

The net cashflow from the post year end equity raising (see subsequent events below and note 17 to the financial statements) will enable the business to restructure its operations in line with an anticipated lower ongoing revenue base following the data disclosure incidents. This will enable the business to return to profitability and positive cashflows.

LandMark White Limited 30 June 2019

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Dividends

The Board has not declared any dividends with respect to FY19 (FY18: 4.6 cents per share)

Dividends paid by the Company since the end of the previous financial year were:

	Cents per	Total Amount
Type	share	$	Franked/Unfranked	Date of payment
Declared and paid during	2.00	$1,522,199	Franked at tax rate of 30%	19 September 2018
the year:

Events subsequent to the end of the reporting period

On 19 July 2019, the Company announced a non-renounceable, partially underwritten entitlement offer for existing shareholders with the aim of raising between $3M and $5.44M of additional capital. The capital raise closed fully subscribed and the Company issue the new shares and received the capital injection on 23 August 2019. The additional equity raised will be used to restructure the Company, further invest in IT infrastructure and pay down debt.

Additionally, the Company entered into a non-binding heads of agreement to acquire newly issued shares in LMW (WA) Holdings Pty Ltd taking its shareholding from 25% to 35% for consideration of $407,000. Separately, the Company has reached agreement to acquire a further 7.2% shareholding in LMW (WA) Holdings Pty Ltd via the purchase of shares from an existing shareholder for consideration of $221,000. As a result of these transactions, the Company’s interest in LMW (WA) Holdings Pty Ltd increased from 25% to 42.2%.

State of affairs

Other than the impacts of the data disclosures incidents, there have been no significant changes in the state of affairs of the Consolidated Entity that occurred during the year under review.

Likely Developments

Refer to the Outlook included in this Directors Report above.

Environmental regulation

The operations of the Consolidated Entity are not subject to any particular and significant environmental regulation under a law of the Commonwealth or of a State or Territory.

REMUNERATION REPORT - AUDITED

Nominations & Remuneration Committee

A major role of the Nominations & Remuneration Committee is to ensure that the remuneration policies and outcomes achieve an appropriate balance between the interests of LandMark White shareholders and rewarding and motivating executives and employees in order to achieve their long-term commitment to the Consolidated Entity. The committee meets as required but generally at least twice per year. The members of the Nominations & Remuneration Committee during the year were:

Name	Independent	Non-executive
Current members
Keith Perrett (Chair)	Y	Y
Stephen Maitland	Y	Y
Brad Piltz	N	Y

LandMark White Limited 30 June 2019

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Remuneration policies

Remuneration levels are competitively set to attract and retain appropriately qualified and experienced directors and senior executives. Remuneration packages of executives and the Chief Executive Officer include a mix of fixed remuneration and performance-based remuneration. The executive remuneration structures set out below are designed to reward increases in the Consolidated Entity’s net profit and earnings per share.

The remuneration of the Consolidated Entity’s senior executives includes a mix of fixed and performance-based incentives. The fixed component consists of base remuneration, allowances and superannuation. The performance-based component is a cash bonus based on a share of a fixed percentage of the level of profit of the executives’ operational division(s). The performance-based component of the remuneration of the Chief Executive Officer is based on several key performance indicators including the increase in the level of profit after tax of the Consolidated Entity. The board considers that the performance-linked incentive is appropriate as it directly aligns the individuals reward with the Consolidated Entity’s performance.

In considering the Consolidated Entity’s performance, the board has regard to the following indices in respect of the current financial year and previous years.

	2019	2018	2017	2016	2015
	$000	$000	$000	$000	$000
Services revenue	42,995	43,157	25,068	22,849	19,731
Net (loss) / profit to equity holders
of the Company	(15,148)	4,140	1,626	1,659	779
The factors that are considered to
affect total shareholders return are
summarised below:
Dividends declared (per share)	-	$0.046	$0.045	$0.045	$0.0375
Share price at the end of the period	$0.180	$0.555	$0.625	$0.52	$0.50
Change in share price	($0.375)	($0.070)	$0.105	$0.02	$0.065

Non-executive directors are paid an annual fee for their service on the board and committees which is determined by the Nominations & Remuneration Committee. Total remuneration for all non-executive directors is not to exceed $400,000 per annum as approved by the shareholders. Non-executive directors’ total salary & fees for the year were $334,077. These fees include statutory superannuation. Non-executive directors do not receive bonuses nor are they currently entitled to be issued with options on securities in the Consolidated Entity. Non-executive directors do not receive any retirement benefits other than statutory superannuation payments. Non-executive directors do not receive separate fees for committee memberships.

The Consolidated Entity has a policy that prohibits those that are granted share-based payments as part of their remuneration from being compensated for changes in value of the underlying securities.

LandMark White Limited 30 June 2019

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Directors’ and senior executive officers’ remuneration

Details of the nature and amount of each major element of the remuneration of each member of key management personnel are:

		Short	term	Post-employment	Post-employment	Long	term
						Movement	Share
						in long	based
		Salary &	Bonus	Superannuation	Termination	term	payment		Performance	Share
Name	Year	Fees	(b)	benefits	benefits	benefits	settled	Total	related	based
		$	$	$	$	$	$	$	%	%
Non-executive directors
K Perrett1	2019	120,000	-	-	-	-	-	120,000	-	-
	2018	16,667	-	-	-	-	-	16,667	-	-
S Maitland1	2019	65,000	-	-	-	-	-	65,000	-	-
	2018	16,667	-	-	-	-	-	16,667	-	-
B Piltz	2019	59,361	-	5,639	-	-	-	65,000
	2018	36,528	-	3,470	-	-	-	39,998	-	-
G White2	2019	41,552	-	3,948	-	-	-	45,500	-	-
	2018	36,528	-	3,470	-	-	-	39,998	-	-
F Hardiman3	2019	35,230	-	3,347	-	-	-	38,577	-	-
	2018	-	-	-	-	-	-	-	-	-
Executive directors
C Coonan4	2019	189,701	-	15,431	-	16,019		221,151	-	-
	2018	228,311	56,235	22,760	-	4,370	-	311,676	18%	-
Other key management personnel
T Rabbitt5	2019	92,308	-	5,333	-	1,552		99,193	-	-
	2018	-	-	-	-	-	-	-	-	-
J Wise6	2019	205,602	-	18,761	-	1,331		225,694	-	-
	2018	182,641	22,831	19,520	-	561	-	225,553	10%	-

Appointed 1 February 2018
Resigned 12 March 2019
FY18 remuneration was prepaid due to the vesting of performance rights with the acquisition of MVS. Resigned 12 March 2019
CEO from 12 April 2016 and director from 17 November 2016, resigned from both roles on 12 March 2019
Acting CEO from 12 March 2019
CFO & Company Secretary from 26 September 2016

Notes in relation to the table of directors’ and executive officers’ remuneration

(a) Analysis of options included in remuneration

Option & Performance Rights - Share Based Payments

The directors at their discretion allocate share options or performance rights that entitle key management personnel and senior employees to purchase shares in the entity. The terms of the options including vesting conditions and performance criteria vary depending upon the incentive arrangements appropriate for key management personnel and senior employees and are a part of an approved Employee Share Acquisition Scheme, which was approved by shareholders at the 2016 Annual General Meeting.

Options

There were no options outstanding at the dated of this report (2018: nil).

Performance Rights

Performance rights may be granted under the LMW Group Performance Rights and Option Plan which was approved by shareholders at the 2016 Annual General Meeting. The Plan allows the Company to grant options or rights to selected key employees to acquire ordinary shares in the Company. Participants are required to satisfy performance and service conditions at the time of the offer. The exercise price for performance rights is nil. Rights cannot be transferred and are not quoted on the ASX.

No performance rights were granted during the year and no performance rights exist as at 30 June 2019.

LandMark White Limited 30 June 2019

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Vesting and exercise of performance rights issued during prior years

There were no performance rights held as at 30 June 2018 and accordingly none vesting or exercised during the year ended 30 June 2019.

(b) Analysis of bonuses included in remuneration

Short-term incentive cash bonuses were awarded to the Acting CEO Timothy Rabbitt and CFO John Wise.

The remuneration of the Acting Chief Executive Officer includes a mix of fixed and performance-based incentives. The fixed component consists of base remuneration, allowances and superannuation. The performance-based component is a cash bonus based on non-financial KPI’s and qualitative assessment of performance. The performance-based incentives are not tied to the financial performance of the consolidated entity.

The remuneration of the Chief Financial Officer includes a mix of fixed and performance-based incentives. The fixed component consists of base remuneration, allowances and superannuation. The performance-based component is a cash bonus based on non-financial KPI’s and qualitative assessment of performance. The performance-based incentives are not tied to the financial performance of the consolidated entity.

Director / Key
Management		Cash Bonus	Cash Bonus	Financial Year the cash
Personnel	Vesting date	Paid / Payable	Forfeited	bonus was paid / is payable
Chris Coonan	30 June 2019	-	100%	-
(CEO to 12 March
2019)
Timothy Rabbitt	30 June 2019	100%	-	2020
(acting CEO from
12 March 2019)
John Wise	30 June 2019	100%	-	2020

Contracted Commitment

Timothy Rabbitt (Acting CEO) and John Wise (CFO) are employed by the Company under ongoing employment contracts. The notice periods and termination payments provided for under these contracts are as follows:

Director / Key		Termination
Management	Notice Period	Payment
Personnel	Months	$
Timothy Rabbitt	1	27,500
John Wise	1	16,667

The termination payments are not provided for in the financial statements.

LandMark White Limited 30 June 2019

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Beneficial interest of directors in shares & options

Movement in shares

The movement during the reporting period in the number of ordinary shares in the Company held directly, indirectly, or beneficially by each key management personnel including their personally related entities is as follows:

follows:
			Vesting &
			exercise of
	Held at		Performance		Retirement	Held at
2019	1 July 2018	Purchases	Rights	Sales	from Board	30 June 2019
Directors
Brad Piltz	4,501,284	-	-	-	-	4,501,284
Stephen Maitland	91,298	-	-	-	-	91,298
Keith Perrett	-	-	-	-	-	-
Glen White	10,870,134	-	-	-	(10,870,134)	-
Frank Hardiman	374,949	-	-	-	(374,949)	-
Chris Coonan	325,000	-	-	(160,731)	(164,269)	-
			Vesting &
			exercise of
	Held at		Performance	Exercise of		Held at
2018	1 July 2017	Purchases	Rights	options	Sales	30 June 2018
Directors
Glen White	10,720,134	150,000	-	-	-	10,870,134
Brad Piltz	4,047,414	453,870	-	-	-	4,501,284
Frank Hardiman	374,949	-	-	-	-	374,949
Chris Coonan	325,000	-	-	-	-	325,000
Stephen Maitland	-	91,298	-	-	-	91,298
Keith Perrett	-	-	-	-	-	-

The executive officers named are those who are directly accountable and responsible for the strategic direction and operational management of the Consolidated Entity. The Directors are of the opinion that only the executive officers detailed above meet the definition of key management personnel as set out in AASB 124 Related Party Disclosures.

Director Related Entity

The Consolidated Entity did not enter into any transactions with a director related entity in either of the years ended 30 June 2019 or 30 June 2018.

END OF REMUNERATION REPORT

Proceedings on behalf of the consolidated entity

During the financial year and in the interval between the end of the financial year and the date of this report the Consolidated Entity has made no application for leave under Section 237 of the Corporations Act 2001.

No person has applied for leave of court to bring proceedings on behalf of the Consolidated Entity or intervene in any proceeding to which the Consolidated Entity is a party for the purpose of taking responsibility on behalf of the Consolidated Entity for all or any part of these proceedings. The Consolidated Entity was not a party to any such proceedings during the year.

LandMark White Limited 30 June 2019

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Directors’ Interests

The relevant interest of each director in the shares issued by the Company as notified by the Directors to the Australian Securities Exchange in accordance with S205G(1) of the Corporations Act 2001, at the date of this report is as follows:

report is as follows:
		Performance Rights over
	OrdinaryShares	OrdinaryShares
Brad Piltz	4,501,284	-
Stephen Maitland	91,298	-
Keith Perrett	-	-

Share Options

Shares under option

There were no unissued ordinary shares of LandMark White Limited under option on the date of the report (2018: Nil).

Shares issued on exercise of options

There were no options exercised during the year (2018: Nil).

Indemnification and Insurance of officers and auditors

Officers

The Consolidated Entity has agreed to indemnify all current Directors of LandMark White Limited to the maximum extent permitted by law against any liability incurred by them by virtue of their holding office as an officer of the Consolidated Entity other than:

a liability owed to the Consolidated Entity or a related body corporate of the Company;
a liability for a pecuniary penalty order under section 1317G of the Law or a compensation order under section 1317H of the Law; or
a liability owed to a person other than the Consolidated Entity that did not arise out of conduct in good faith.

Since the end of the previous financial year, the Consolidated Entity has paid premiums in respect of Directors and Officers liability insurance, for all past, present, or future directors, secretaries, officers or employees of the Consolidated Entity. Conditions of the Insurance policy restrict disclosure of the premium amount.

The insurance premiums relate to:

costs and expenses incurred by the relevant officers in defending proceedings, whether civil or criminal and whatever their outcome
other liabilities that may arise from their position, with the exception of conduct involving a wilful breach of duty or improper use of information or position to gain a personal advantage.

Further details of insurance policies have not been disclosed as the policies prohibit such disclosure.

Auditors

The Company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the Company or any related entity against a third-party liability incurred by the auditor.

During the year, the Company has not paid a premium in respect of a contract to insure the auditor of the Company or any related entity.

LandMark White Limited 30 June 2019

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Rounding of Amounts

The Consolidated Entity has applied the relief available under ASIC Instrument 2016/191 and accordingly, amounts in the financial statements and directors’ report have been rounded to the nearest thousand dollars, or in certain cases, to the nearest dollar.

Auditors Independence Declaration under Section 307C of the Corporations Act 2001

The auditor’s independence declaration is set out on page 12 and forms part of the Directors’ Report for the financial year ended 30 June 2019.

Non-audit services

During the year, William Buck, the Company’s auditor, has performed certain other services in addition to their statutory duties.

The board has considered the non-audit services provided during the year by the auditor and in accordance with written advice provided by resolution of the Audit & Risk Committee, is satisfied that the provision of those nonaudit services during the year by the auditor is compatible with, and did not compromise, the auditor independence requirements of the Corporations Act 2001 for the following reasons:

all non-audit services were subject to the corporate governance procedures adopted by the Consolidated Entity and have been reviewed by the Audit & Risk Committee to ensure that they do not impact the integrity and objectivity of the auditors; and
the non-audit services provided do not undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a management or decision-making capacity for the Consolidated Entity, acting as an advocate for the Consolidated Entity or jointly sharing risks and rewards.

Details of the amounts paid to the auditors of the Consolidated Entity, William Buck, and its related practices for audit and non-audit services provided during the year are set out below:

Statutory audit Service other than statutory audit Restructuring advice Preparation & lodgement of taxation returns Tax advice re employee share plan Due diligence for acquisition of associated entity Completion accounts review for acquired entities	2019 $ 2018 $ 143,500 120,870
	300,000 - 11,100 10,000 13,000 - - 12,000 - 2,000
	324,100 24,000

This report is made in accordance with a resolution of the directors.

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Keith Perrett Director

Dated at Sydney this 16[th] day of September 2019

LandMark White Limited 30 June 2019

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LandMark White Limited

Auditor’s independence declaration under section 307c of the Corporations Act 2001

I declare that, to the best of my knowledge and belief during the year ended 30 June 2019 there have been:

No contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and
No contraventions of any applicable code of professional conduct in relation to the audit.

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William Buck

Accountants & Advisors ABN 16 021 300 521

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L E. Tutt

Partner

Sydney, 16 September 2019

ACCOUNTANTS & ADVISORS Sydney Office Level 29, 66 Goulburn Street Sydney NSW 2000

Parramatta Office Level 7, 3 Horwood Place Parramatta NSW 2150

Telephone: +61 2 8263 4000 williambuck.com

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William Buck is an association of firms, each trading under the name of William Buck across Australia and New Zealand with affiliated offices worldwide. Liability limited by a scheme approved under Professional Standards Legislation other than for acts or omissions of financial services licensees.

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CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

Note Revenue from rendering of services 1 Other income 3(a) Expenses from operating activities: Employee expenses Report presentation expenses Marketing expenses Communications expenses Insurance expenses Administration expenses Occupancy expenses Depreciation and amortisation expenses Impairment of investment in associated entity 13(b) Impairment of intangible assets 6(c) Reversal of deferred consideration payable 6(c) Other expenses from operating activities Results from operating activities Finance income 3(b) Finance expense 3(b) Share of net (loss) / profit of associates accounted for using the equity method (Loss) / profit before tax Income tax benefit / (expense) 4 (Loss) / profit for the year attributable to owners of the parent Total other comprehensive income (net of tax) Total comprehensive (loss) / income for the year attributable to owners of the parent Basic earnings per share 22(a) Diluted earnings per share 22(b)	2019 $000 2018 $000 41,493 42,452 1,502 705
	42,995 43,157
	33,376 30,204 2,576 1,800 514 413 663 382 1,716 1,133 1,533 424 2,053 1,256 808 792 753 - 12,284 8,700 - (8,700) 2,147 1,100
	58,423 37,504
	(15,428) 5,653 44 62 (204) (14)
	(160) 48
	(29) 106
	(15,617) 5,807 469 (1,667)
	(15,148) 4,140 - -
	(15,148) 4,140
	($18.36) $0.054 ($18.36) $0.054

The above statement of profit or loss and other consolidated income should be read in conjunction with the accompanying notes.

LandMark White Limited 30 June 2019

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CONSOLIDATED BALANCE SHEET	2019 $000 2018 $000 1,816 2,772 72 108 3,832 5,306 480 - - 97 1,019 556
Assets Note Cash and cash equivalents 5(a) Term deposits 5(b) Trade and other receivables 5(c) Income tax receivable 6(a) Work in progress 6(f) Other current assets 6(g) Total current assets Deferred tax assets 6(e) Term deposits 5(b) Plant and equipment 6(b) Intangible assets 6(c) Investments accounted for using the equity method 13(b) Total non-current assets Total assets Liabilities Trade and other payables 5(d) Borrowings 5(e) Current tax liabilities 6(d) Employee benefits 6(h) Provisions 6(i) Total current liabilities Borrowings 5(e) Deferred tax liabilities 6(e) Employee benefits 6(h) Provisions 6(i) Total noncurrent liabilities Total liabilities Net assets Equity Issued capital 7 (Accumulated deficit) / Retained earnings Reserves Total equity
	7,219 8,839
	2,172 984 846 608 880 693 25,173 28,220 571 1,417
	29,642 31,922
	36,861 40,761
	2,568 1,946 2,055 58 46 110 3,939 2,555 - -
	8,608 4,669
	3,250 61 7 29 517 205 192 172
	3,966 467
	12,574 5,136
	24,287 35,625
	39,293 33,893 (15,006) 1,732 - -
	24,287 35,625

The above consolidated balance sheet should be read in conjunction with the accompanying notes.

LandMark White Limited 30 June 2019

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Balance at 1 July 2017 Total comprehensive income attributable to members of the parent entity Shares issued Dividends to shareholders Balance at 30 June 2018	Share Capital $000 Retained Earnings / (Accumulated Deficit) $000 Total Equity $000 33,773 1,279 35,052 - 4,140 4,140 120 - 120 - (3,687) (3,687)
	33,893 1,732 35,625

Balance at 1 July 2018	33,893 1,732 35,625
Change in accounting policy (note 24(a)(iii))	- (68) (68)
Total comprehensive loss attributable to members of the parent entity	- (15,148) (15,148)
Shares issued	5,400 - 5,400
Dividends to shareholders	- (1,522) (1,522)
Balance at 30 June 2019	39,293 (15,006) 24,287

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

LandMark White Limited 30 June 2019

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CONSOLIDATED STATEMENT OF CASH FLOWS	2019 $000 2018 $000 51,166 47,307 (50,309) (42,825) 44 62 (204) (14) 64 125 64 (302) (769) (2,616)
Cash flows from operating activities Note Cash receipts in the course of operations Cash payments in the course of operations Interest received Interest paid Dividends received Decrease / (increase) in security deposits Income tax paid Net cash provided by operating activities 8(a) Cash flows from investing activities Payments for plant and equipment 6(b) Payments for intangible assets 6(c) Purchase of investments - Acquisition of controlled entity 12(a) - Acquisition of unincorporated businesses - Deferred consideration paid - Acquisition of associated entity Decrease / (Increase) in surplus cash on term deposit Net cash used in investing activities Cash flows from financing activities Shares issued Borrowings received Repayment of borrowings Dividends paid 11(a) Net cash (used) / provided from in financing activities Net (decrease) / increase in cash and cash equivalents held Cash and cash equivalents at beginning of the year Cash and cash equivalents at the end of the year 5(a)
	56 1,737
	(260) (346) (679) (448) (3,695) - (42) - - (2,037) - (663) - 2,500
	(4,676) (994)
	- - 7,152 - (1,966) (149) (1,522) (3,567)
	3,664 (3,716)
	(956) (2,973) 2,772 5,745
	1,816 2,772

The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.

LandMark White Limited 30 June 2019

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

How numbers are calculated .......................................................................................................................................................... 18	How numbers are calculated .......................................................................................................................................................... 18
1	Revenue ....................................................................................................................................................................... 18
2	Material profit or loss items .................................................................................................................................... 18
3	Other income and expense items ......................................................................................................................... 19
4	Income tax expense .................................................................................................................................................. 20
5	Financial assets and financial liabilities ................................................................................................................ 21
6	Non-financial assets and liabilities ........................................................................................................................ 24
7	Equity ............................................................................................................................................................................ 32
8	Cash flow information .............................................................................................................................................. 33
Risk ......................................................................................................................................................................................................... 34
9	Significant estimates & judgements ...................................................................................................................... 34
10	Financial risk management ...................................................................................................................................... 34
11	Capital management ................................................................................................................................................. 37
Group structure .................................................................................................................................................................................. 39
12	Business combinations ............................................................................................................................................. 39
13	Interests in other entities ........................................................................................................................................ 40
Unrecognised items ........................................................................................................................................................................... 43
14	Contingent liabilities ................................................................................................................................................. 43
15	Commitments ............................................................................................................................................................. 43
16	Guarantees .................................................................................................................................................................. 43
17	Events occurring after the reporting period ....................................................................................................... 43
18	Going Concern ........................................................................................................................................................... 44
Other information .............................................................................................................................................................................. 45
19	Related party transactions ...................................................................................................................................... 45
20	Share-based payments ............................................................................................................................................. 45
21	Remuneration of auditors ....................................................................................................................................... 46
22	Earnings per share ..................................................................................................................................................... 46
23	Parent entity financial information ....................................................................................................................... 47
24	Summary of significant accounting policies ........................................................................................................ 48
25	Changes to accounting policies ............................................................................................................................. 59

LandMark White Limited 30 June 2019

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HOW NUMBERS ARE CALCULATED

This section provides additional information about those individual line items in the financial statements that the directors consider most relevant in the context of the operations of the entity, including:

a) Accounting policies that are relevant for an understanding of the items recognised in the financial statements. These cover situations where the accounting standards either allow a choice or do not deal with a particular type of transaction;
b) Analysis and sub-totals, including segment information; and
c) Information about estimates and judgements made in relation to particular items.
1 Revenue

Revenue
Revenue from rendering of services Recovery of disbursements Recharge of shared services to licensees	2019 $000 2018 $000 40,899 41,705 100 193 494 554
	41,493 42,452

(a) Revenue from rendering of services

Revenue from the rendering of services to clients is recognised when the individual performance obligation under the applicable contract is satisfied and at the price agreed in the contract. For the large majority of contracts, there is a single performance obligation at the completion of the service and revenue is recognised at this point.

(b) Recovery of disbursements

Where the contract with the client allows the recovery of disbursements incurred in delivering the services, these are billed to the client at the time the performance obligation in the contract is satisfied or in accordance with an agreed billing schedule as appropriate.

(c) Recharge of shared services to licensees

Revenue relating to the provision of shared services to licensees is billed and recognised on a monthly basis over the term of the agreement relating to the provision of such services.

Further information on the measurement and timing of recognition of revenues may be found in note 24(e).

2 Material profit or loss items

The Consolidated Entity has identified a number of items which are material due to the significance of their nature and/or amount. These are listed separately here to provide a better understanding of the financial performance of the Consolidated Entity.

erformance of the Consolidated Entity.
Notes Impairment of intangible assets 2(a) Reversal of deferred consideration 2(b) Impairment of investment in associated entity 2(c)	2019 $000 2018 $000 12,284 8,700 - (8,700) 753 -
	13,037 -

LandMark White Limited 30 June 2019

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(a) Impairment of intangible assets

2019

As a result of the reduction in revenues, profits and cashflows from the business units that rely upon bank lender valuation instructions following the data disclosure incidents in February and May 2019 as well as reduced revenues received by the Statutory Services business units, the carrying value of goodwill in the residential, commercial and regional business units has been tested at 30 June 2019.

2018

As a result of the reduced performance of the acquired business for the calendar year ended 31 December 2017 the carrying value of goodwill and customer relationships relating to the acquisition of MVS National was tested as at 31 December 2017.

Based upon the estimated recoverable amount of the cash generating unit associated with the Government Services goodwill, an impairment charge of $8,700,000 was recognised through the Statement of Profit or Loss and Other Comprehensive Income.

(b) Revision of deferred consideration

2018

The provisional amounts recognised in the 30 June 2017 financial statements on the acquisition of MVS National included estimated deferred contingent consideration of $8,700,000. The deferred consideration was contingent upon the performance of the acquired business over the period from 1 January 2017 through to 30 June 2020 with the maximum deferred consideration calculated based on the performance for the calendar year ended 31 December 2017. The actual performance of the acquired business for the calendar year 31 December 2017 was lower than initially estimated and as a result the deferred consideration was no longer payable and accordingly was released to the Statement of Profit or Loss and Other Comprehensive Income.

(c) Impairment of investment in associated entity

2019

As a result of the reduction in revenues, profits and cashflows following the data disclosure incidents in February and May 2019, the carrying value of LMW’s investment in its associate has been tested at 30 June 2019.

Based upon the estimated recoverable amounts of the associate an impairment charge of $753,000 has been recognised through the Statement of Profit or Loss and Other Comprehensive Income.

3 Other income and expense items

This note provides a breakdown of the items included in ‘other income’ and ‘finance income and expenses’. Information about specific profit and loss items (such as gains and losses in relation to the sale of plant & equipment) is disclosed in the related balance sheet notes.

(a) Other income

a) Other income
Insurance proceeds Licence fee income Dividends received Sundry income	2019 $000 2018 $000 995 - 466 610 - 58 41 37
	1,502 705

LandMark White Limited 30 June 2019

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Insurance proceeds represents the net benefit received as a result of insurance claims made following the following the data disclosure incidents in February and May 2019. Insurance proceeds are recognised when the applicable insurer has confirmed cover and the benefit payable under that cover.

Licence fee income represents fees charged to non-controlled entities which have been licenced to use the LMW brand and systems. Licence fees are charged as a percentage of revenue earned by the licensee. Licence fee income is recognised when the right to receive the income has been established.

Dividend income is recognised when the right to receive the dividend has been declared by the entity in which the Consolidated Entity has an investment.

(b) Finance income and expenses

b) Finance income and expenses
Finance income Finance expenses	2019 $000 2018 $000 44 62 (204) (14)
	(160) 48

Finance income comprises interest income on funds invested. Interest income is recognised using the effective interest rate method, which, for floating rate financial assets, is the rate inherent in the instrument. Interest income is recognised as it accrues in the Statement of Profit & Loss and Other Comprehensive Income, using the effective interest method.

Finance expenses comprise interest expense on borrowings and unwinding of the discount on financial assets. All borrowing costs are recognised in the Statement of Profit & Loss and Other Comprehensive Income using the effective interest method.

4 Income tax expense

This note provides an analysis of the Consolidated Entity’s income tax expense, shows what amounts are recognised directly in equity and how the tax expense is affected by non-assessable and non-deductible items. It also explains significant estimates made in relation to the Consolidated Entity’s tax position.

(a) Income tax (benefit) / expense

a) Income tax (benefit) / expense
Current tax Current year (tax loss carried forward) / tax payable Adjustments for prior years Total current tax (benefit) / expense Deferred income tax Decrease in deferred tax assets (note 6(e)) Increase in deferred tax liabilities (note 6(e)) Total deferred tax expense Income tax (benefit) / expense	2019 $000 2018 $000 (705) 1,412 87 (53)
	(618) 1,359
	142 295 7 13
	149 308
	(469) 1,667

LandMark White Limited 30 June 2019

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(b) Reconciliation of income tax (benefit) / expense to prima facie tax payable

(Loss) / profit from continuing operations before tax Prima facie income tax (benefit) / expense calculated at 30% on profit (2018: 30%) Increase/(decrease) in income tax expense due to: Non-deductible expenses - Intangible asset impairment - Investment impairment - Acquisition costs - Entertainment - Other expenses Non-assessable share of loss / (profit) of associate Fully franked dividend Adjustments for prior years Income tax (benefit) / expense	2019 $000 2018 $000 (15,617) 5,807
	(4,685) 1,742 3,685 - 226 - 158 - 22 27 30 - 8 (32) - (17)
	(556) 1,720 87 (53)
	(469) 1,667

5 Financial assets and financial liabilities

This note provides information about the Consolidated Entity’s financial instruments, including:

An overview of all financial instruments held by the Consolidated Entity;
Specific information about each type of financial instrument;
Accounting policies; and
Information about determining the fair value of the instruments, including judgements and estimation uncertainty involved.

The Consolidated Entity holds the following financial instruments:

he Consolidated Entity holds the following financial instruments:
Note Financial assets at amortised cost Cash and cash equivalents 5(a) Term deposits 5(b) Trade and other receivables 5(c) Financial liabilities at amortised cost Trade and other payables 5(d) Borrowings 5(e)	2019 $000 2018 $000 1,816 2,772 72 108 3,832 5,306
	5,720 8,186
	2,568 1,946 5,305 119
	7,873 2,065

(a) Cash and cash equivalents

a) Cash and cash equivalents
Cash at bank and on hand Cash and cash equivalents in the Statement of Cash Flows	2019 $000 2018 $000 1,816 2,772
	1,816 2,772

LandMark White Limited 30 June 2019

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Access was available at the reporting date to the following lines of credit:

Access was available at the reporting date to the following lines of credit:
Available: Bank bill facility Bank overdraft Unused at reporting date: Bank bill facility Bank overdraft	2019 $000 2018 $000 5,000 - 1,200 1,200
	6,200 1,200
	- - 1,200 1,200
	1,200 1,200

The bank overdraft facility may be drawn at any time and may be terminated by the bank without notice. The bank bill and overdraft facilities are secured via fixed and floating charges over the assets and business of the Consolidated Entity.

As at 30 June 2019, the Consolidated Entity is in breach of certain conditions of these facilities, however the provider of the facilities has waived historic breaches and has also provided an undertaking not to exercise its rights as a result of both the historic breaches and those expected to occur up to and including to 31 December 2019.

Based on these undertakings, together with representations made by the lender and the Consolidated Entity’s cashflow forecasts, which also take into account the capital raising that occurred post balance sheet (note 17(a)), the bank bills currently drawn on the bank bill facility have not entirely been reclassified as current liabilities (note 5(e)).

(b) Term deposits

Term deposits that have a maturity of three months or less from the date of acquisition, which do not provide security for long term commitments (for example property lease guarantees) and are repayable with 24 hours’ notice with no loss of interest are included in cash and cash equivalents.

Term deposits that do not satisfy these requirements are recorded as separate financial assets.

(c) Trade and other receivables

c) Trade and other receivables
Current Trade receivables Less: provision for expected credit losses Other receivables	2018 $000 2017 $000 3,919 5,331 (250) (113) 163 88
	3,832 5,306

(i) Classification as trade and other receivables

Trade receivables are amounts due from customers for services performed in the ordinary course of business. Other receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. If collection of the amounts is expected in one year or less they are classified as current assets. If not, they are presented as non-current assets. Trade receivables are generally due for settlement within 30 days and therefore are all classified as current. The Consolidated Entity’s impairment and other accounting policies for trade and other receivables are outlined in notes 10(a) and 24(k) respectively.

(ii) Fair values of trade and other receivables

Due to the short-term nature of the current receivables, their carrying amount is considered to be the same as their fair value.

LandMark White Limited 30 June 2019

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(iii) Impairment and risk exposure

Information about the impairment of trade and other receivables, their credit quality and the Consolidated Entity’s exposure to credit risk, foreign currency risk and interest rate risk can be found in note 10.

(d) Trade and other payables

Current Trade payables Other payables and accrued expenses	2019 $000 2018 $000 1,407 981 1,161 965 2,568 1,946

Trade payables are unsecured and are usually paid within 30 days of recognition. The carrying amounts of trade and other payables are considered to be the same as their fair values, due to their short-term nature.

(e) Borrowings

Current Short term loan Commercial bank bills Lease liabilities Non-Current Commercial bank bills Lease liabilities Total	2019 $000 2018 $000 249 - 1,750 - 56 58 2,055 58 3,250 - - 61 3,250 61 5,305 119

Secured liabilities

The commercial bank bills are secured via fixed and floating charges over the assets and business of the Consolidated Entity.

Lease liabilities are effectively secured as the rights to the leased assets recognised in the financial statements revert to the lessor in the event of default.

evert to the lessor in the event of default.
Finance lease commitments Within one year One year or later and no later than five years Later than five years Future finance charges Recognised as a liability Current Non-current	2019 $000 2018 $000 62 64 - 62 - -
	62 126 (6) (7)
	56 119
	56 58 - 61
	56 119

LandMark White Limited 30 June 2019

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6 Non-financial assets and liabilities

This note provides information about the Consolidated Entity's non-financial assets and liabilities, including:

Specific information about each type of non-financial asset and non-financial liability:
Income tax receivable (note 6(a))
- Work in progress (note 6(f))
Plant and equipment (note 6(b)) Other current assets (note 6(g))
- - Intangible assets (note 6(c)) Employee benefit obligations (note 6(h))
- - Current tax liabilities (note 6(d)) Provisions (note 6(i))
- Deferred tax balances (note 6(e))
Accounting policies; and
Information about determining the fair value of the assets and liabilities, including judgements and estimation uncertainty involved.
(a) Income tax receivable

Current Income tax receivable	2019 $000 2018 $000 480 -

As a large taxpayer, LMW ordinarily remits monthly income tax instalments to the Australian Taxation Office based on the revenues recorded each month. As a result of the data disclosure incidents in February and May 2019, LMW requested a variation to its income tax instalment amounts and a refund of amounts already paid. This was granted by the Australian Taxation Office and a refund of instalments made with respect to FY19 was received in July 2019.

(b) Plant & equipment

(b) Plant & equipment
Cost Balance at 1 July 2017 Additions Disposals Balance at 30 June 2018	Office Equipment $000 Furniture and Fittings $000 Leasehold Improvements $000 Total $000 628 48 467 1,143 253 10 83 346 (13) - - (13)
	868 58 550 1,476

Balance at 1 July 2018	868 58 550 1,476
Acquisition of controlled entities	1,359 523 218 2,100
Additions	203 44 13 260
Disposals	(447) (10) (348) (805)
Balance at 30 June 2019	1,983 615 433 3,031
Accumulated Depreciation Balance at 1 July 2017 Depreciation charge for the year Disposals Balance at 30 June 2018	304 14 199 517 186 10 77 273 (7) - - (7)
	483 24 276 783

Balance at 1 July 2018	483 24 276 783
Acquisition of controlled entities	1,225 308 154 1,687
Depreciation charge for the year	278 65 84 427
Disposals	(447) (10) (289) (746)
Balance at 30 June 2019	1,539 387 225 2,151

LandMark White Limited 30 June 2019

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	Office	Furniture and	Leasehold
	Equipment	Fittings	Improvements	Total
	$000	$000	$000	$000
Carrying Amounts
1 July 2017	324	34	268	626
30 June 2018	385	34	274	693
1 July 2018	385	34	274	693
30 June 2019	444	228	208	880

(i) Recognition and measurement

Items of plant and equipment are stated at cost less accumulated depreciation (see below) and impairment losses (see accounting policy Note 24(n)).

When parts of an item of plant and equipment have different useful lives, they are accounted for as separate items (major components) of plant and equipment.

Gains and losses on disposal of an item of plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of plant and equipment and are recognised net within “other income” in the Statement of Profit & Loss and Other Comprehensive Income.

(ii) Depreciation

Depreciation is charged to the Statement of Profit & Loss and Other Comprehensive Income on a straightline basis over the estimated useful lives of each part of an item of plant and equipment. Leased assets are depreciated over the shorter of the lease term and their useful lives, unless it is reasonably certain that the Consolidated Entity will obtain ownership by the end of the lease term.

The estimated useful lives in the current and comparative periods are as follows:

•	Office equipment	2-5 years
•	Furniture and fittings	4-5 years
•	Leasehold improvements	life of the lease or 10 years

The residual value, the useful life and the depreciation method applied to an asset are reassessed at least annually.

(c) Intangible assets

c) Intangible assets
Notes Goodwill (i) – (v) Customer relationships (i) – (v) Computer software (vi) Trademarks (vii)	2019 $000 2018 $000 13,884 17,205 10,000 10,000 1,247 973 42 42
	25,173 28,220

Customer relationships relate to an assessment of the value of contractual and other relationships within acquired businesses. These assets have an indefinite useful life as it is not possible to forecast if, or when, these relationships will end. Accordingly, the value of customer relationships is not amortised, however it is tested for impairment annually.

(i) Goodwill & customer relationships

The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the fair values of the assets transferred, the liabilities incurred and the equity interests issued by the Consolidated Entity.

LandMark White Limited 30 June 2019

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Where the acquired subsidiary has significant long-term contracts or other customer relationships the future value of these relationships is assessed and is included as an asset in the fair value above of assets transferred.

Goodwill on the acquisition of subsidiaries is included in intangible assets. Goodwill is not amortised but it is tested for impairment annually or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold. Goodwill is allocated to cash generating units for the purpose of impairment testing. The allocation is made to those cash generating units or groups of cash generating units that are expected to benefit from the business combination in which the goodwill arose.

(ii) Subsequent expenditure

Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred.

(iii) Impairment tests for goodwill & customer relationships

Goodwill & customer relationships have indefinite useful lives and are not amortised. The goodwill & customer relationships amounts are tested for impairment annually by estimating the recoverable amount of the cash generating units based on value in use.

The following cash generating units have significant carrying amounts for goodwill & customer relationships:

elationships:
Goodwill Commercial valuations Residential valuations Regional valuations Government Services Customer relationships Government Services Movement in Goodwill Balance at 1 July Acquisition of controlled entity Adjustment to provisional amounts recognised on the acquisition of MVS National on 31 May 2017 Impairment charge Balance at 30 June Movement in customer relationships Balance at 1 July Adjustment to provisional amounts recognised on the acquisition of MVS National on 31 May 2017 Balance at 30 June	2019 $000 2018 $000 - 1,833 3,016 7,074 8,963 - 1,905 8,298
	13,884 17,205
	10,000 10,000
	10,000 10,000
	17,205 32,405 8,963 - - (6,500) (12,284) (8,700)
	13,884 17,205
	10,000 3,500 - 6,500
	10,000 10,000

LandMark White Limited 30 June 2019

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(iv) Revision of provisional amounts recognised

The provisional amounts recognised in the 30 June 2017 financial statements on the acquisition of MVS National included estimated deferred contingent consideration of $8,700,000. The deferred consideration was contingent upon the performance of the acquired business over the period from 1 January 2017 through to 30 June 2020 with the maximum deferred consideration calculated based on the performance for the calendar year ended 31 December 2017. The actual performance of the acquired business for the calendar year 31 December 2017 was lower than initially estimated and as a result the deferred consideration was longer be payable and accordingly has been released to the Statement of Profit or Loss and Other Comprehensive Income.

(v) Impairment charge

2019

As a result of the reduction in revenues, profits and cashflows from the business units that rely upon bank lender valuation instructions following the data disclosure incidents in February and May 2019 as well as reduced revenues received by the Statutory Services business units, the carrying value of goodwill in the Residential, Commercial and Statutory Services business units has been tested at 30 June 2019.

Based upon the estimated recoverable amounts of the cash generating units detailed above an impairment charge of $12,284,000 has been recognised through the Statement of Profit or Loss and Other Comprehensive Income. This comprises $4,057,000 for Residential, $1,833,000 for Commercial and $6,394,000 for Statutory Services cash generating units respectively.

The key assumptions and the approach to determining the value in use when estimating the recoverable amount of a cash generating unit are:

Assumption How determined

Cash flows The forecast 5-year cash flows are based on forecast results for the year ended 30 June 2020. The 2020 forecast forms the basis of cash flows in subsequent financial years adjusted based on the following assumptions determined on management’s past experience:

Reduction in revenues in the first year and a 3%-10% increase in the years after reflecting the rebuilding of the LMW business following the data disclosure incidents;
Reduction in overheads expenses in the first year and 3% increase in the years after;
Reduction in employment expenses in the first year and an increase in employee expense calculated as 50%-60% of the increase in revenue in the years after; and
Terminal value at the end of year 5 based on year 5 cash flows.

Discount rate The discount rate adopted was a pre-tax rate of 13% and was based on the current risk-free interest rate, industry and business specific risk factors, market borrowing rates and investor expected returns.

On forecast 5-year cash flows, further impairments would be necessary in Residential and Statutory Services if the discount rate was increased beyond 13% and all other variables remained unchanged.

There would not be any impairment for Regional until the discount rate reached 17% with all other variables are unchanged.

LandMark White Limited 30 June 2019

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2018

As a result of the reduced performance of the acquired business for the calendar year ended 31 December 2017 the carrying value of Goodwill & Customer Relationships relating to the acquisition of MVS National was tested for impairment as at 31 December 2017. Based upon the estimated recoverable amount of the cash generating unit associated with the Statutory Services goodwill, an impairment charge of $8,700,000 was recognised through the Statement of Profit or Loss and Other Comprehensive Income.

The key assumptions and the approach to determining the value in use when estimating the recoverable amount of a cash generating unit are:

Assumption How determined

Cash flows The forecast 5-year cash flows were based on forecast results for the year ended 30 June 2019. The 2019 forecast forms the basis of cash flows in subsequent financial years adjusted based on the following assumptions determined on management’s past experience:

• No increase in revenues and overheads expenses in the first year and 3% increase in the years after;

• Increase in employee expense calculated as 50%-60% of the increase in revenue since the prior year; and

Terminal value at the end of year 5 based on year 5 cash flows.

Discount rate The discount rate adopted was a pre-tax rate of 12% and was based on the current risk-free interest rate, industry and business specific risk factors, market borrowing rates and investor expected returns.

On forecast 5-year cash flows, there would not be any impairment until the discount rate reached 60% for Residential, 37% for Commercial and 13% for Government. In this scenario, all other variables are unchanged.

(vi) Computer software

vi) Computer software
Movement in computer software Balance at 1 July Acquisition of controlled entities Additions Amortisation Balance at 30 June	2019 $000 2018 $000 973 1,044 - - 679 448 (405) (519)
	1,247 973

Costs incurred in developing products or systems and costs incurred in acquiring software and licences that will contribute to future period financial benefits through revenue generation and/or cost reduction are capitalised to software and systems. Costs capitalised include external direct costs of materials and service and direct payroll and payroll related costs of employees’ time spent on the project.

Amortisation is calculated on a straight-line basis over periods generally ranging from 3 to 5 years.

IT development costs include only those costs directly attributable to the development phase and are only recognised following completion of technical feasibility and where the entity has an intention and ability to use the asset.

LandMark White Limited 30 June 2019

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(vii) Trademarks Balance at 1 July Balance at 30 June (d) Current tax liabilities Current Tax liability	2019 $000 2018 $000 42 42
	42 42
	2019 $000 2018 $000 46 110

The current tax liability for the Consolidated Entity of $46,000 (2018: $110,000) represents the amount of income taxes payable in respect of current and prior financial periods. In accordance with the tax consolidation legislation, LandMark White Limited as the head entity of the Australian tax-consolidated group has assumed responsibility for the current tax asset/liability initially recognised by the members in the tax-consolidated group.

Income tax on the Statement of Profit & Loss and Other Comprehensive Income for the year comprises current and deferred tax. Income tax is recognised in the Statement of Profit & Loss and Other Comprehensive Income except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the end of the reporting period, and any adjustment to tax payable in respect of previous years.

The Company and its wholly-owned Australian resident entities have formed a tax-consolidated group with effect from 1 July 2003 and are therefore taxed as a single entity from that date. Newly acquired wholly-owned entities are immediately added to the tax-consolidation group. The head entity within the tax-consolidated group is LandMark White Limited.

(i) Tax consolidation

Current tax expense/income, 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 group allocation approach by reference to the carrying amounts of assets and liabilities in the separate financial statements of each entity and the tax values applying under tax consolidation.

Any current tax liabilities (or assets) and deferred tax assets arising from unused tax losses of the subsidiaries are assumed by the head entity in the tax-consolidated group and are recognised as amounts payable (receivable) to (from) other entities in the tax-consolidated group in conjunction with any tax funding arrangement amounts (refer below). Any difference between these amounts is recognised by the Company as an equity contribution or distribution.

The Company recognises deferred tax assets arising from unused tax losses of the tax-consolidated group to the extent that it is probable that future taxable profits of the tax-consolidated group will be available against which the tax losses can be utilised.

Any subsequent period adjustments to deferred tax assets arising from unused tax losses as a result of revised assessments of the probability of recoverability are recognised by the head entity only.

(ii) Nature of tax funding arrangements and tax sharing arrangements

The head entity, in conjunction with other members of the tax-consolidated group, has entered into a tax funding arrangement which sets out the funding obligations of members of the tax-consolidated group in respect of tax amounts. The tax funding arrangements require payments to/from the head entity equal to the current tax liability (asset) assumed by the head entity and any tax-loss deferred tax asset assumed by

LandMark White Limited 30 June 2019

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the head entity, resulting in the head entity recognising an inter-entity receivable (payable) equal in amount to the tax liability (asset) assumed. Any such inter-entity receivables (payables) are at call.

Contributions to fund the current tax liabilities are payable as per the tax funding arrangement and reflect the timing of the head entity’s obligation to make payments for tax liabilities to the relevant tax authorities.

The head entity in conjunction with other members of the tax-consolidated group has also entered into a tax sharing agreement. The tax sharing agreement provides for the determination of the allocation of income tax liabilities between the entities should the head entity default on its tax payment obligations. No amounts have been recognised in the financial statements in respect of this agreement as payment of any such amounts under the tax sharing agreement is considered remote.

(e) Deferred tax balances

Deferred tax assets and liabilities are attributable to the following:

eferred tax assets and liabilities are attributable to the following:
Recognised deferred tax assets Employee provisions Doubtful debts provision Accruals Operating lease provisions Make good provisions S40-880 “black hole” expenditure Income tax losses carried forward Other Recognised deferred tax liabilities Right of use assets Work in progress	2019 $000 2018 $000 1,063 606 75 34 97 30 19 25 38 26 172 259 705 - 3 4
	2,172 984
	(7) - - (29)
	(7) (29)

Movement in temporary differences during the year

	Balance 1 July 18 $000 Recognised in Profit & Loss $000 Acquisitions $000	Recognised in Retained Earnings $’000 Balance 30 June 19 $000
Deferred tax assets
Employee provisions	606 (115) 572	- 1,063
Doubtful debts	34 (5) 46	- 75
Accruals	30 44 23	- 97
Operating lease provisions	25 (6) -	- 19
Make good provisions	26 12 -	- 38
S40-880 “black hole” expenditure	259 (87) -	- 172
Income tax losses carried forward	- 705 -	- 705
Other	4 4 (5)	- 3
	984 552 636	- 2,172

Deferred tax liabilities
Right of use assets	- (7) -	- (7)
Work in progress	(29) - -	29 -
	(29) (7) -	29 (7)

LandMark White Limited 30 June 2019

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Deferred tax assets Employee provisions Doubtful debts Accruals Operating lease provisions Make good provisions S40-880 “black hole” expenditure Provision for restructuring Other Deferred tax liabilities Work in progress (f) Work in progress Work in progress (g) Other current assets Prepaid expenses (h) Employee benefit obligations Current Annual leave Long service leave Performance pay Non-current Long service leave (i) Provisions Non-Current Operating lease Make Good	Balance 1 July 17 $000 Recognised in Profit & Loss $000 Acquisitions $000 Recognised in Equity $’000 Balance 30 June 18 $000 739 (133) - - 606 26 8 - - 34 24 6 - - 30 18 7 - - 25 36 (10) - - 26 345 (86) - - 259 86 (86) - - - 5 (1) - - 4 1,279 (295) - - 984 (16) (13) - - (29) 2019 $000 2018 $000 - 97 2019 $000 2018 $000 1,019 556 2019 $000 2018 $000 1,351 1,063 1,676 752 912 740 3,939 2,555 517 205 2019 $000 2018 $000 64 84 128 88 192 172	Balance 1 July 17 $000 Recognised in Profit & Loss $000 Acquisitions $000 Recognised in Equity $’000 Balance 30 June 18 $000 739 (133) - - 606 26 8 - - 34 24 6 - - 30 18 7 - - 25 36 (10) - - 26 345 (86) - - 259 86 (86) - - - 5 (1) - - 4 1,279 (295) - - 984 (16) (13) - - (29) 2019 $000 2018 $000 - 97 2019 $000 2018 $000 1,019 556 2019 $000 2018 $000 1,351 1,063 1,676 752 912 740 3,939 2,555 517 205 2019 $000 2018 $000 64 84 128 88 192 172
	1,279 (295)
	(16) (13)

		2019 $000 2018 $000 1,019 556
		2019 $000 2018 $000 1,351 1,063 1,676 752 912 740
		3,939 2,555
		517 205
		2019 $000 2018 $000 64 84 128 88
		192 172

LandMark White Limited 30 June 2019

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Balance at 1 July 2017 Acquisition of controlled entity Reversal during year Increase during year Balance at 30 June 2018	Operating Lease $000 Make Good $000 Total $000 62 121 183 - (88) (88) - (11) (11) 22 66 88
	84 88 172

Balance at 1 July 2018	84 88 172
Utilised during year	- - -
Reversal during year	(20) - (20)
Increase during year	- 40 40
Balance at 30 June 2019	64 128 192

(i) Operating lease

Provisions are made in order to straight line the minimum lease payments for the rental of office space over the total lease periods.

(ii) Make good

The provision has not been discounted to its present value as the effect is not material. It is expected that the expense will be incurred in a 5-year period.

7 Equity

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share on a poll at meetings of the Company. On a show of hands, every shareholder present at a meeting or by proxy is entitled to one vote. There are currently 85,134,111 ordinary fully paid shares on issue (2018: 76,109,944). Shares have no par value, and the Company does not have a limited amount of capital.

Share Capital Balance as 30 June 2017 Issued via Dividend Reinvestment Plan Balance at 30 June 2018	Number $000 75,930,855 33,773 179,089 120
	76,109,944 33,893
Netproceeds from issue of shares in relation to acquisition	9,024,167 5,400
Balance at 30 June 2019	85,134,111 39,293

LandMark White Limited 30 June 2019

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8 Cash flow information

(a) Reconciliation of (loss) / profit after income tax to net cash inflow from operating activities

Note (Loss) / Profit for the period after tax Adjustments for the period Depreciation & amortisation Impairment of intangible assets Impairment of investment in associated entity Share of losses / (profits) of associates not received as dividends Doubtful debts Credit posted directly to retained earnings Loss on disposal of fixed assets Changes in assets & liabilities during the period net of amounts relating to acquisition of controlled entities (Increase)/decrease in security deposits (Increase)/decrease in receivables (Increase)/decrease in work in progress 6(f) (Increase)/decrease in deferred tax assets 6(e) (Increase)/decrease in other assets Increase/(decrease) in payables 5(d) Increase/(decrease) in provision for income tax 6(d) Increase/(decrease) in deferred tax liabilities 6(e) Increase/(decrease) in employee provisions 6(h) Increase/(decrease) in other provisions 6(i) Net cash from operating activities	2019 $000 2018 $000 (15,148) 4,140 832 792 12,284 - 753 - 93 (39) 28 46 (68) - 99 6
	(1,127) 4,945 64 (302) 3,894 (58) 97 (44) (552) 295 (304) 94 (769) (1,033) (693) (1,257) (22) 13 (512) (905) (20) (11)
	56 1,737

Note
(Loss) / Profit for the period after tax
Adjustments for the period
Depreciation & amortisation
Impairment of intangible assets
Impairment of investment in associated entity
Share of losses / (profits) of associates not received as
dividends
Doubtful debts
Credit posted directly to retained earnings
Loss on disposal of fixed assets
Changes in assets & liabilities during the period net of amounts
relating to acquisition of controlled entities
(Increase)/decrease in security deposits
(Increase)/decrease in receivables
(Increase)/decrease in work in progress
6(f)
(Increase)/decrease in deferred tax assets
6(e)
(Increase)/decrease in other assets
Increase/(decrease) in payables
5(d)
Increase/(decrease) in provision for income tax
6(d)
Increase/(decrease) in deferred tax liabilities
6(e)
Increase/(decrease) in employee provisions
6(h)
Increase/(decrease) in other provisions
6(i)
Net cash from operating activities

2019
$000
2018
$000
(15,148)
4,140
832
792
12,284
-
753
-
93
(39)
28
46
(68)
-
99
6

(1,127)
4,945
64
(302)
3,894
(58)
97
(44)
(552)
295
(304)
94
(769)
(1,033)
(693)
(1,257)
(22)
13
(512)
(905)
(20)
(11)

56
1,737

LandMark White Limited 30 June 2019

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RISK

This section of the notes discusses the Consolidated Entity’s exposure to various risks and shows how these could affect the Consolidated Entity’s financial position and performance.

9 Significant estimates & judgements

The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. Management also needs to exercise judgement in applying the Consolidated Entity’s accounting policies.

This note provides an overview of the areas that involved a higher degree of judgement or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be wrong. Detailed information about each of these estimates and judgements is included in notes 1 to 7 together with information about the basis of calculation for each affected line item in the financial statements.

The areas involving significant estimates or judgements are:

Impairment of goodwill (note 6(c))
Provisions (note 6(i))
Recognition of revenue (note 1)

10 Financial risk management

This note explains the Consolidated Entity’s exposure to financial risks and how these risks could affect the Consolidated Entity’s future financial performance. Current year profit and loss information has been included where relevant to add further context.

Risk	Exposure arising from	Measurement	Management
Credit risk	Cash and cash	Ageing analysis	Diversification of bank
	equivalents, trade	Credit ratings	deposits
	receivables and held-to-		Credit limits
	maturity investments
Liquidity risk	Borrowings and other	Rolling cash flow	Availability of borrowing
	liabilities	forecasts	facilities
Interest rate risk	Long-term borrowings at	Sensitivity analysis	Interest rate swaps
	variable rates

The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework. The Chief Executive Officer and Chief Financial Officer are responsible for developing and monitoring risk management policies.

Risk management policies are established to identify and analyse the risks faced by the Consolidated Entity, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Consolidated Entity’s activities. The Consolidated Entity, through their training and management standards and procedures, aim to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.

The Consolidated Entity’s Audit Committee oversees how management monitors compliance with the Consolidated Entity’s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the Consolidated Entity.

(a) Credit Risk

Credit risk is the risk of financial loss to the Consolidated Entity if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Consolidated Entity’s receivables from wholesale and retail clients.

LandMark White Limited 30 June 2019

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Trade and other receivables

The Consolidated Entity’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the Consolidated Entity’s customer base, including the default risk of the industry and country, in which clients operate, has less of an influence on credit risk. However, geographically there is no concentration of credit risk within Australia.

The Consolidated Entity has established a credit policy under which each new customer is analysed individually for creditworthiness before the Consolidated Entity’s standard payment and delivery terms and conditions are offered. Credit limits are established for each customer, these limits are reviewed regularly. Clients which fail to meet the Consolidated Entity’s benchmark creditworthiness are placed on a restricted customer list and may transact with the Consolidated Entity only on a prepayment basis.

In monitoring customer credit risk, clients are grouped according to their credit characteristics, including whether they are an individual or legal entity, whether they are a wholesale, retail or end-user customer, geographic location, industry, ageing profile, maturity and existence of previous financial difficulties. The Consolidated Entity’s trade and other receivables relate mainly to the Consolidated Entity’s retail clients. The Consolidated Entity does not require collateral in respect of trade and other receivables.

The Consolidated Entity has established an allowance for credit losses that represents their estimate of expected credit losses in respect of trade and other receivables and investments.

Exposure to credit risk

The carrying amount of the Consolidated Entity’s financial assets represents the maximum credit risk exposure.

The Consolidated Entity’s maximum exposure to credit risk at the end of the reporting period was:

he Consolidated Entity’s maximum exposure to credit risk at the end of the	reporting period was:
Trade and other receivables Cash and cash equivalents Term deposits & other The Consolidated Entity’s maximum exposure to credit risk for trade and other receivables before impairment losses at the end of the reporting period by type of customer was: Financial clients Non-financial clients Government non-financial clients The Consolidated Entity’s most significant clients included the following amounts within trade and other receivables carrying amounts: An Australian financial client An Australian Government non-financial client	2019 $000 2018 $000 3,832 5,306 1,816 2,772 918 716
	6,566 8,794
	1,283 2,404 1,183 662 1,453 2,265
	3,919 5,331
	205 257 1,036 2,109

LandMark White Limited 30 June 2019

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Impairment Losses

The aging of the Consolidated Entity’s trade and other receivables at the end of the reporting period was:

he aging of the Consolidated Entity’s	trade and other receivables at the end of the reporting period was:
Not past due Past due 0-30 days Past due 31-120 days Past due 121-365 days	Gross Impairment Gross Impairment 2019 $000 2019 $000 2018 $000 2018 $000 3,031 - 3,821 - 326 - 1,298 - 225 - 88 - 337 250 124 113
	3,919 250 5,331 113

The movement in the allowance for impairment in respect of trade receivables during the year was as follows:

he movement in the allowance for impairment in respect of trade receivables	during the year was as follows:
Balance at 1 July Acquisition of controlled entities Increase in provision Balance at 30 June	2019 $000 2018 $000 113 88 154 - (17) 25
	250 113

Based on historic default rates, the Consolidated Entity believes that no impairment allowance is necessary in respect of trade receivables not past due or past due by up to 120 days. The Consolidated Entity's policy is to enforce upfront payment from clients who do not have a good credit history or from those who are relatively unknown. Accordingly, the trade receivables balance is comprised of clients that have no previous history of poor credit with the Consolidated Entity.

(b) Liquidity risk

Liquidity risk is the risk that the Consolidated Entity will not be able to meet its financial obligations as they fall due. The Consolidated Entity’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Consolidated Entity’s reputation.

Typically, the Consolidated Entity ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 45 to 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.

The following are the contractual maturities of financial liabilities, including estimated interest payments and excluding the impact of netting arrangements:

excluding the impact of netting arrangements:
Non-derivative financial liabilities	Carrying amount Contractual cash flows Payable 6 months or less Payable between 6 and 12 months Payable after 12 months $000 $000 $000 $000 $000
30 June 2019
Trade and other payables	2,568 2,568 2,568 - -
Performance pay liability	912 912 912 - -
Short and long term loans	5,249 5,249 249 1,750 3,250
Lease liabilities	56 56 29 27 -
	8,785 8,785 3,758 1,777 3,250
30 June 2018 Trade and other payables Performance pay liability Lease liabilities	1,946 1,946 1,946 - - 740 740 740 - - 119 119 29 29 61
	2,805 2,805 2,715 29 61

LandMark White Limited 30 June 2019

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(c) Interest risk

Interest rate risk is the risk that changes in interest rates will affect the Consolidated Entity’s income and expenses or the value of its holdings of financial instruments and financial liabilities. The objective of interest rate risk management is to manage and control interest rate risk exposures within acceptable parameters, while optimising the return.

Interest rate risk is managed by seeking to maximise the yield achieved on cash held at bank and minimise the interest rates incurred on borrowings.

At the end of the reporting period the interest rate profile of the Consolidated Entity’s interest-bearing financial instruments and borrowings was:

Variable rate instruments Cash and cash equivalents Current borrowings Long-term borrowings	2019 $000 2018 $000 1,816 2,772 1,750 - 3,250 -

(d) Cash flow sensitivity analysis for rate instruments

The impact of interest rate changes on the profitability of the Consolidated Entity is likely to be immaterial.

(e) Fair values

The Directors consider that the fair value of financial assets and financial liabilities of the Consolidated Entity approximate their carrying amount.

11 Capital management

The board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Board of Directors monitors the return on capital, which the Consolidated Entity defines as net operating income divided by total shareholders’ equity. The board compares this to general relevant returns that would be available to alternate use of funds such as property and general stock market returns available at the time but does not specifically benchmark them. The Board of Directors also monitors the dividend yield to ordinary shareholders and compares them to general ASX listed returns at the time but does not specifically benchmark them.

There were no changes in the Consolidated Entity’s approach to capital management during the year. The Consolidated Entity is not subject to externally imposed capital requirements given the absence of borrowings.

(a) Dividends

(i) Ordinary shares

Dividends recognised in the current and prior years by the Company are:

Cents per share	Total amount $000 Franked/ unfranked Date of Payment
2019
Final 2018 ordinary 2.00	1,522 Franked 19 September 2018
2018 Final 2017 ordinary 2.25 Interim 2018 ordinary 2.60	1,708 Franked 3 October 2017 1,979 Franked 5 April 2018 3,687

LandMark White Limited 30 June 2019

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(ii) Franked dividends

Dividends declared or paid during the year were fully franked at the tax rate of 30%. (2018: 30%)

After the end of the reporting period, the directors have not declared a final dividend.

Dividend franking account 30% franking credits available to shareholders of LandMark White Limited for subsequent financial years	Company 2019 $000 Company 2018 $000 1,529 2,299

The above available amounts are based on the balance of the dividend franking account at the end of the reporting period adjusted for:

(a) Franking credits that will arise from the payment of the current tax liabilities;
(b) Franking debits that will arise from the payment of dividends recognised as a liability at the yearend; and
(c) Franking credits that will arise from the receipt of dividends recognised as receivables by the tax consolidated group at the year-end.

The ability to utilise the franking credits is dependent upon there being sufficient available profits to declare dividends. As there is no dividend declared for 2019, there is no impact on the dividend franking account for dividends proposed after the end of the reporting period but not recognised as a liability (2018: impact was to reduce the franking account by $652,000).

LandMark White Limited 30 June 2019

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GROUP STRUCTURE

This section provides information which will help users understand how the group structure affects the financial position and performance of the Consolidated Entity as a whole. In particular, there is information about:

Changes to the structure that occurred during the year as a result of business combinations and the disposal of a discontinued operation;
Transactions with non-controlling interests; and
Interests in joint operations.

A list of significant subsidiaries is provided in note 13(a). This note also discloses details about the Consolidated Entity’s equity accounted investments.

12 Business combinations

(a) Summary of acquisition

On 15 October 2018 the parent entity acquired 100% of the issued share capital of Taylor Byrne (Holdings) Pty Ltd ("Taylor Byrne"). The terms of the sale and purchase agreement provided for the effective date of transfer of economic benefit to be 1 October 2018 and accordingly the completion balance sheet was prepared at 30 September 2018 and results consolidated from 1 October 2018.

Details of the purchase consideration, the net assets acquired, and goodwill are as follows:

Details of the purchase consideration, the net assets acquired, and goodwill are as follows:
Purchase consideration: Cash paid – initial consideration Ordinary shares issued Additional amount paid in respect of working capital position on completion The assets and liabilities recognised as a result of the acquisition were as follows: Cash and cash equivalents Term deposits Trade and other receivables Other current assets Deferred tax assets Plant and equipment Trade and other payables Employee benefits Tax liability Net identifiable assets acquired Goodwill Net cash outflow from acquisition Cash paid – initial consideration Additional amount paid in respect of working capital position on completion Cash and cash equivalents acquired	2019 $000 5,150 5,150
	10,300 2,235
	12,535
	3,690 266 2,448 159 636 413 (1,641) (2,208) (149)
	3,614 8,921
	12,535
	(5,150) (2,235) 3,690
	(3,695)

The goodwill is attributable to the workforce and the high profitability of the acquired business. It will not be deductible for tax purposes.

LandMark White Limited 30 June 2019

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13 Interests in other entities

(a) Subsidiaries

The Consolidated Entity’s subsidiaries at 30 June 2019 are set out below. Unless otherwise stated, they have share capital consisting solely of ordinary shares that are held directly by the Consolidated Entity, and the proportion of ownership interests held equals the voting rights held by the Consolidated Entity. All entities are incorporated and operate in Australia only.

	Ownership interest	Ownership interest
	held	by the	Ownership interest
	Consolidated		held by non-
Name of entity	Entity		controlling interests		Principal
	2019	2018	2019	2018	activities
	%	%	%	%
LMW (Residential) Pty Ltd	100	100	-	-	Residential valuations
LMW (Brisbane) Pty Ltd	100	100	-	-	Commercial valuations
LMW (Gold Coast) Pty Ltd	100	100	-	-	Commercial valuations
LMW (Melbourne) Pty Ltd	100	100	-	-	Commercial valuations
LMW (Statutory Services) Pty Ltd	100	100	-	-	Government valuations
Taylor Byrne Holdings Pty Ltd	100	-	-	-	Non-trading
Taylor Byrne Pty Ltd	100	-	-	-	Regional valuations
Lane Infrastructure Pty Ltd	100	-	-	-	Property advisory services
LMW Australia Pty Ltd	50	50	50	50	National valuation
					contracting entity
LMW Group Pty Ltd	100	100	-	-	Franchisor
LMW Hegney Pty Ltd	50	50	50	50	Holder of intellectual
					property
LMW (Management) Pty Ltd	100	100	-	-	Group employer
LMW (Employee Benefits) Pty Ltd	100	100	-	-	Non-trading
LMW Advisory Pty Ltd	100	100	-	-	Non-trading
MVS National Pty Ltd	100	100	-	-	Non-trading
Cosgrave & Eastoe Pty Ltd	100	-	-	-	Non-trading
Hoolihan Valuations Pty Ltd	100	-	-	-	Non-trading

(b) Interests in associates

The Consolidated Entity’s interests in associates at 30 June 2019 are set out below. Unless otherwise stated, they have share capital consisting solely of ordinary shares that are held directly by the Consolidated Entity, and the proportion of ownership interests held equals the voting rights held by the Consolidated Entity. All entities are incorporated and operate in Australia only.

Name of entity LMW (WA) Holdings Pty Ltd	2019 2018 2019 2018 Principal activities % % $000 $000 25 25 571 1,417 WA valuations

(i) Summarised financial information for associates

The tables below provide summarised consolidated financial information for LMW (WA) Holdings Pty Ltd and its wholly owned group. The information disclosed reflects the amounts presented in its financial statements and not LandMark White Limited’s share of these amounts. They have been amended to reflect adjustments made by the entity when using the equity method including fair value adjustments and modifications for differences in accounting policy.

LandMark White Limited 30 June 2019

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Summarised balance sheet Current assets Cash and cash equivalents Other current assets Total current assets Non-current assets Current liabilities Financial liabilities (excluding trade payables) Other current liabilities Total current liabilities Non-current liabilities Financial liabilities (excluding trade payables) Other non-current liabilities Total non-current liabilities Net assets Reconciliation to carrying amounts Opening net assets 1 July 2018 (1 January 2018) (Loss) / profit for the period Other comprehensive income Dividends paid Closing net assets 30 June Consolidated Entity’s share of closing net assets in % Consolidated Entity’s share of closing net assets in $ Unrecognised goodwill included in the carrying amount Impairment of investment Carrying amount of interest in associate Summarised statement of comprehensive income Revenue Interest income Depreciation and amortisation Interest expense Other expenses (Loss) / profit from continuing operations before tax Income tax expense (Loss) / profit from continuing operations after tax Other comprehensive (loss) / income Total comprehensive (loss) / income Dividends received from associates	30 Jun 2019 $000 30 Jun 2018 $000 445 1,191 1,022 1,156
	1,467 2,347
	4,566 4,600
	74 114 874 1,389
	948 1,503
	148 166 159 129
	307 295
	4,778 5,149
	5,149 4,995 (114) 424 - - (257) (270)
	4,778 5,149
	25% 25%
	1,194 1,287 130 130 (753) -
	571 1,417
	12 months to 30 Jun 2019 $000 6 months to 30 Jun 2018 $000 7,086 4,585 3 3 (99) (45) (10) (5) (7,089) (3,936)
	(109) 602 (5) (178)
	(114) 424 - -
	(114) 424
	131 67

LandMark White Limited 30 June 2019

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(ii) Impairment charge

2019

As a result of the reduction in revenues, profits and cashflows within LMW Holdings (WA) Pty Ltd following the data disclosure incidents in February and May 2019, the carrying value of LandMark White Limited’s interest in LMW Holdings (WA) Pty Ltd has been tested at 30 June 2019.

Based upon the estimated recoverable amounts an impairment charge of $753,000 has been recognised through the Statement of Profit or Loss and Other Comprehensive Income.

The key assumptions and the approach to determining the value in use when estimating the recoverable amount of a cash generating unit are:

Assumption How determined

Reduction in revenues in the first year and a 3% increase in the years after reflecting the rebuilding of the business following the data disclosure incidents;
Reduction in overheads expenses in the first year and 3% increase in the years after;
Reduction in employment expenses in the first year and an increase in employee expense calculated as 60% of the increase in revenue in the years after; and
Terminal value at the end of year 5 based on year 5 cash flows.

On forecast 5-year cash flows, further impairments would be necessary if the discount rate was increased beyond 13% and all other variables remained unchanged.

LandMark White Limited 30 June 2019

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UNRECOGNISED ITEMS

This section of the notes provides information about items that are not recognised in the financial statements as they do not (yet) satisfy the recognition criteria.

14 Contingent liabilities

The Consolidated Entity, from time to time, is involved in matters of litigation in the normal course of business in undertaking valuation services. At 30 June 2019 there are no open litigated claims. The Consolidated Entity has professional indemnity insurance, and under the terms of the insurance policy, each claim has an excess which is required to be paid by the Consolidated Entity. It was not practical to estimate the maximum contingent liability arising from litigation; however, in a worst-case situation there could be a material adverse effect on the Consolidated Entity’s financial position. In the directors’ opinion, disclosures of any further information in relation to litigation would be prejudicial to the interests of the Consolidated Entity.

15 Commitments

Capital expenditure

The Consolidated Entity does not have any capital expenditure commitments at the end of the reporting period.

Operating lease commitments Within one year One year or later and no later than five years Later than five years	2019 $000 2018 $000 3,022 2,381 5,804 6,584 593 1,075
	9,419 10,040

The Consolidated Entity leases property and equipment under non-cancellable operating leases expiring from one to five years. Leases of property generally provide the Consolidated Entity with a right of renewal at which time all terms are renegotiated. Lease payments may be increased to reflect market rates or changes in the Consumer Price Index.

16 Guarantees

LandMark White Limited has not entered into any guarantees, in the current or previous financial year, in relation to the debts of its subsidiaries.

17 Events occurring after the reporting period

(a) Capital Raise

019. The amount raised and intended use is as follows:
Use Staff restructuring strategy IT infrastructure investment Increased investment in LMW (WA) Holdings Pty Ltd (note 17(b)) Reduction in debt / working capital Costs of offer – prospectus Costs of offer – capital raising	$000 1,600 400 628 2,292 190 330
	5,440

As a result of the capital raise, the number of shares on issue increased from 85,134,111 to 155,679,930 with share capital increasing from $39,293,000 at 30 June 2019 to $44,385,000.

LandMark White Limited 30 June 2019

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(b) Acquisition of additional interest in Associated Entity

On 18 July 2019, the Company entered into a non-binding heads of agreement to acquire newly issued shares in LMW (WA) Holdings Pty Ltd taking its shareholding from 25% to 35% for consideration of $407,000. The acquisition was completed on 13 September 2019.

Separately, the Company has reached agreement to acquire a further 7.2% shareholding in LMW (WA) Holdings Pty Ltd via the purchase of shares from an existing shareholder for consideration of $221,000. This acquisition was completed on 23 August 2019.

As a result of these transactions, the Company’s interest in LMW (WA) Holdings Pty Ltd has increased from 25% to 42.2%.

18 Going Concern

The Company has been the subject of two cyber incidents which resulted in a number of clients suspending utilisation of LMW’s services with a resulting reduction in revenues and cashflows which prima facie may impact the ability of the Company to pay its debts as and when they fall due. As a result of the reduction in revenues, the Company incurred a net loss of $15,148,000 for the year ended 30 June 2019.

The directors have prepared the financial information contained within this report on a going concern basis for the following reasons:

The Company was trading profitability prior to the cyber incidents.
The cyber incidents were the result of criminal activity and are not ongoing. NSW Cyber Police are continuing their investigations.
The Company has substantially enhanced its cyber security measures to limit the chance of recurrence.
Whilst many mortgage lending clients temporarily suspended trading with the Company, they have either recommenced trading or are expected to recommence trading with the Company in the future.
The Company has secured short term funding from its corporate banker which will allow it to trade through the period whilst its cashflows return.
By the end of the current calendar year, the Company expects its revenues, profitability and operating cashflows to be at levels that allow it to provide appropriate returns to shareholders and therefore to continue to trade.
The Company has concluded a successful capital raise of $5.44M that will allow it to restructure its business and continue profitable and cashflow positive trading into the future.
The Company has prepared detailed cashflow forecasts through to June 2020 which confirm its ability to continue to pay its debts as and when they fall due.

The directors are satisfied that the going concern basis of preparation is appropriate and therefore the financial information does not include any adjustments relating to the recoverability or classification of recorded asset amounts or to the amounts or classification of liabilities that might be necessary should the company not be able to continue as a going concern.

LandMark White Limited 30 June 2019

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OTHER INFORMATION

This section of the notes includes other information that must be disclosed to comply with the accounting standards and other pronouncements, but that is not immediately related to individual line items in the financial statements.

19 Related party transactions

(a) Subsidiaries

Interests in subsidiaries are set out in note 13(a).

(b) Key management personnel compensation

b) Key management personnel compensation
Short term employee benefits Post-employment benefits Long-term benefits	2019 $ 2018 $ 861,213 596,408 - 49,220 18,902 4,931
	880,115 650,559

Detailed remuneration disclosures are provided in the remuneration report on pages 5 to 9.

(c) Transactions with other related parties

The following transactions occurred with related parties:

Dividends received from associate Group management fee income from associates & franchisees	2019 $ 2018 $ 131 67 494 554

20 Share-based payments

(a) Employee option & performance rights plans

Movements in options during the period were as follows:

ovements in options during the period were as	follows:
As at 1 July Exercised during the year As at 30 June	2019 Average Exercise Price 2019 Number of Options 2018 Average Exercise Price 2018 Number of Options - - - - - - - -
	- - - -

Performance rights were granted under the LMW Group Performance Rights and Option Plan which was approved by shareholders at the 2016 Annual General Meeting. The Plan allows the Company to grant options or rights to selected key employees to acquire ordinary shares in the Company. Participants are required to satisfy performance and service conditions at the time of the offer. The exercise price for performance rights is nil. Rights cannot be transferred and are not quoted on the ASX.

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Movements in performance rights during the period were as follows:

Movements in performance rights during the period were as follows:
As at 1 July Vested and exercised during the year As at 30 June	2019 Number of Rights 2018 Number of Rights - - - -
	- -

(b) Expenses arising from share-based payment transactions

Total expenses arising from share-based payment transactions recognised during the period as part of employee benefit expense were as follows:

enefit expense were as follows:
Options Performance rights 1 Remuneration of auditors Audit services Auditor of the Consolidated Entity – William Buck Audit and review of the financial reports Other services Other William Buck related entities Restructuring advice Taxation and other services Total services	2019 $ 2018 $ - - - -
	- -
	2019 $000 2018 $000 144 121 300 - 24 22
	468 143

21 Remuneration of auditors

22 Earnings per share

(a) Basic earnings per share

The calculation of basic earnings per share at 30 June 2019 was based on the loss attributable to ordinary shareholders of $15,148,000 (2018: profit $4,140,000) and the weighted average number of ordinary shares outstanding during the financial year ended 30 June 2019 of 82,513,394 (2018: 76,063,822) calculated as follows:

ollows:
(Loss) / profit attributable to ordinary shareholders Weighted average number of ordinary shares Issued Ordinary Shares at 1 July Weighted average number of ordinary shares at 30 June	2019 $000 2018 $000 (15,148) 4,140
	Number Number 76,109,944 75,930,855
	82,513,394 76,063,822

LandMark White Limited 30 June 2019

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(b) Diluted earnings per share

The calculation of diluted earnings per share at 30 June 2019 was based on the loss attributable to ordinary shareholders of $15,148,000 (2018: profit $4,140,000) and the weighted average number of ordinary shares outstanding during the financial year ended 30 June 2019 of 82,513,394 (2018: 76,063,822) calculated as follows:

ollows:
Profit attributable to ordinary shareholders Weighted average number of ordinary shares Issued Ordinary Shares at 1 July Weighted average number of ordinary shares at 30 June	2019 $000 2018 $000 (15,148) 4,140
	Number Number 76,109,944 75,930,855
	82,513,394 76,063,822

As at the date of this report, there are no options or performance rights over unissued ordinary shares in LandMark White Limited.

23 Parent entity financial information

The following information has been extracted from the books and records of the parent and has been prepared in accordance with the accounting standards.

(a) Statement of financial position

a) Statement of financial position
Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Total liabilities Net assets Equity Issued capital Retained earnings Total equity b) Statement of profit & loss and other comprehensive income Total (loss) / profit Total comprehensive income	2019 $000 2018 $000 20,314 15,591 45,250 33,305
	65,564 48,896
	26,104 13,558 3,320 112
	29,424 13,670
	36,140 35,226
	39,293 33,893 (3,153) 1,333
	36,140 35,226
	2019 $000 2018 $000 (2,964) 3,955
	(2,964) 3,955

(b) Statement of profit & loss and other comprehensive income

LandMark White Limited 30 June 2019

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24 Summary of significant accounting policies

This note provides a list of the significant accounting policies adopted in the preparation of these consolidated financial statements to the extent they have not already been disclosed in the other notes above. These policies have been consistently applied to all the years presented, unless otherwise stated. The financial statements are for the Consolidated Entity consisting of LandMark White Limited and its subsidiaries.

(a) Basis of preparation

These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board and the Corporations Act 2001. LandMark White Limited is a for-profit entity for the purpose of preparing the financial statements.

(i) Compliance with IFRS

The consolidated financial statements also comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

(ii) Historicalcost convention

The financial statements have been prepared on a historical cost basis, except for the following:

Financial assets and liabilities (including derivative instruments) certain classes of plant and equipment and investment property – measured at fair value;
Assets held for sale – measured at fair value less cost of disposal; and
Defined benefit pension plans – plan assets measured at fair value.
(iii) New and amended standards adopted by the Consolidated Entity

During the current year, the Consolidated Entity adopted all of the new and revised Australian Accounting Standards and Interpretations applicable to its operations which became mandatory.

AASB 9 - Financial Instruments (applicable for reporting periods commencing on or after 1 January 2018)

AASB 9 includes requirements for the classification and measurement of financial assets, the accounting requirements for financial liabilities, impairment testing requirements and hedge accounting requirements.

The application of this standard did not have an impact on the carrying values of financial instruments held by the Consolidated Entity.

AASB 15 - Revenue from Contracts with Clients (applicable for reporting periods commencing on or after 1 January 2018)

AASB 15 established a single, comprehensive framework for revenue recognition, and replaced previous revenue Standards.

AASB 15 introduced a five-step process for revenue recognition with the core principle of the new Standard being for entities to recognise revenue to depict the transfer of goods or services to clients in amounts that reflect the consideration (that is, payment) to which the entity expects to be entitled in exchange for those goods or services.

AASB 15 also resulted in enhanced disclosures about revenue, provides guidance for transactions that were not previously addressed comprehensively (for example, service revenue and contract modifications) and improved guidance for multiple-element arrangements.

Prior to adopting this standard, the Consolidated Entity recognised revenue and work in progress in relation to partially completed valuation contracts. With the adoption of the standard, the Consolidated Entity now only recognises revenue when the valuation is completed and delivered to the client.

Application of this standard resulted in de-recognition of $97,000 work in progress balance as at 1 July 2018 and had a minimal impact on the timing of reported profits.

LandMark White Limited 30 June 2019

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AASB 9 and AASB 15 were adopted using the modified retrospective approach and as such comparatives have not been restated. The adoption of AASB 9 had no impact on the opening retained profits as at 1 July 2018.

The impact of adoption of AASB 15 on opening retained profits as at 1 July 2018 was as follows:

Work in progress reversed Deferred tax liability	1 July 2018 $000 (97) 29
	(68)

The impact of the new Accounting Standards compared with the previous Accounting Standards on the current reporting period is as follows:

	Current year	Current year
	Under	Under
	AASB 15	AASB 118	Difference
	$000	$000	$000
Revenue from operations	42,995	43,092	(97)
Loss before income tax	(15,617)	(15,520)	(97)
Income tax benefit	469	440	29
Loss after income tax	(15,148)	(15,080)	(68)
Work in progress	-	-	-
Net assets	24,287	24,287	-

(iv) New standards and interpretations not yet adopted

The AASB has issued new and amended accounting standards and interpretations that have mandatory application dates for future reporting periods and which the Consolidated Entity has decided not to early adopt. A discussion of those future requirements and their impact on the Company is as follows:

AASB 16 Leases (applicable for annual reporting periods commencing on or after 1 January 2019)

AASB 16 introduces a single lessee accounting model that requires all leases to be accounted for on balance sheet. A lessee will be required to recognise an asset representing the right to use the underlying asset during the lease term (i.e. right-of-use asset) and a liability to make lease payments (i.e. lease liability). Two exemptions are available for leases with a term less than 12 months or if the underlying asset is of low value.

The lessor accounting requirements are substantially the same as in AASB 117. Lessors will therefore continue to classify leases as either operating or finance leases.

AASB 16 will replace AASB 117 Leases, Interpretation 4 Determining Whether an Arrangement contains a Lease, Interpretation 115 Operating Leases – Incentives and Interpretation 127 Evaluating the substance of Transactions Involving the Legal Form of a Lease.

LandMark White Limited 30 June 2019

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The Consolidated Entity has performed a detailed impact assessment of AASB 16. In summary the impact of AASB 16 adoption is expected to be as follows:

f AASB 16 adoption is expected to be as follows:
Assets Property, plant and equipment (right of use assets) Deferred tax assets Liabilities Lease liabilities Provisions (operating lease under AASB 117) Net impact on equity	$000 3,103 48 (3,363) 100
	(112)

Impact on the statement of profit or loss (increase/(decrease) for the year ended 30 June 2019:

Occupancy expenses Depreciation and amortisation expenses Results from operating activities Financial expenses Profit before tax Income tax expense Profit from operations after income tax for the half year	$000 (1,377) 1,129
	(248) 303
	55 (16)
	39

Due to the adoption of AASB 16, the Consolidated Entity's operating profit will improve, while its interest expense will increase. This is due to the change in accounting for expenses of leases that were classified as operating leases under AASB 117.

(b) Principles of consolidation and equity accounting

(i) Subsidiaries

Subsidiaries are all entities (including structured entities) over which the Consolidated Entity has control. The Consolidated Entity controls an entity when the Consolidated Entity 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 to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Consolidated Entity. They are deconsolidated from the date that control ceases.

The acquisition method of accounting is used to account for business combinations by the Consolidated Entity (refer to note 24(h)).

Intercompany transactions, balances and unrealised gains on transactions between companies within the Consolidated Entity are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Consolidated Entity.

Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of profit or loss, statement of comprehensive income, statement of changes in equity and balance sheet respectively.

(ii) Associates

Associates are all entities over which the Consolidated Entity has significant influence but not control or joint control. This is generally the case where the Consolidated Entity holds between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting (see (iii) below), after initially being recognised at cost.

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(iii) Equity method

Under the equity method of accounting, the investments are initially recognised at cost and adjusted thereafter to recognise the Consolidated Entity’s share of the post-acquisition profits or losses of the investee in profit or loss, and the Consolidated Entity’s share of movements in other comprehensive income of the investee in other comprehensive income. Dividends received or receivable from associates and joint ventures are recognised as a reduction in the carrying amount of the investment.

When the Consolidated Entity’s share of losses in an equity-accounted investment equals or exceeds its interest in the entity, including any other unsecured long-term receivables, the Consolidated Entity does not recognise further losses, unless it has incurred obligations or made payments on behalf of the other entity.

Unrealised gains on transactions between the Consolidated Entity and its associates and joint ventures are eliminated to the extent of the Consolidated Entity’s interest in these entities. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of equity accounted investees have been changed where necessary to ensure consistency with the policies adopted by the Consolidated Entity.

The carrying amount of equity-accounted investments is tested for impairment in accordance with the policy described in note 24(m).

(iv) Changes in ownership interests

The Consolidated Entity treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity owners of the Consolidated Entity. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any consideration paid or received is recognised in a separate reserve within equity attributable to owners of LandMark White Limited.

When the Consolidated Entity ceases to consolidate or equity account for an investment because of a loss of control, joint control or significant influence, any retained interest in the entity is remeasured to its fair value with the change in carrying amount recognised in profit or loss. This fair value becomes the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Consolidated Entity had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

If the ownership interest in an associate is reduced but joint control or significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income are reclassified to profit or loss where appropriate.

(c) Functional and presentation currency

These consolidated financial statements are presented in Australian dollars which is the Company’s functional currency and the functional currency of all entities within the Consolidated Entity.

(d) Segment reporting

The Consolidated Entity’s operations and clients are located entirely in Australia.

The Consolidated Entity’s operating segments have been identified based on the segments analysed within management reports. Based on these criteria, it has been determined that the Consolidated Entity only operates in the Valuation segment, which provides valuation, research and advice services in relation to property and businesses.

Accordingly, no separate segment reporting is required.

LandMark White Limited 30 June 2019

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(e) Revenue recognition

Revenue is recognised at an amount that reflects the consideration to which the Consolidated Entity is expected to be entitled to receive for the provision of services to clients.

For each contract with a client, the Consolidated Entity identifies the contract, the performance obligations in the contract and the total price for the services. The total price is then allocated to the separate performance obligations under the contract and each part of the total price is recognised as revenue when the associated performance obligation is satisfied.

For the large majority of contracts with clients, the Consolidated Entity has a single performance obligation being the delivery of the service and so the revenue is recognised at this point in time.

The specific accounting policies for the Consolidated Entity’s main types of revenue are explained in note 1.

(f) Income tax

The income tax expense or credit for the period is the tax payable on the current period’s taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

(g) Leases

Leases of plant and equipment where the Consolidated Entity, as lessee, has substantially all the risks and rewards of ownership are classified as finance leases (note 6). Finance leases are capitalised at the lease’s inception at the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding rental obligations, net of finance charges, are included in other short-term and long-term payables. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to the profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The plant and equipment acquired under finance leases is depreciated over the asset’s useful life or over the shorter of the asset’s useful life and the lease term if there is no reasonable certainty that the Consolidated Entity will obtain ownership at the end of the lease term.

Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Consolidated Entity as lessee are classified as operating leases (note 15). Payments made under operating leases

LandMark White Limited 30 June 2019

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(net of any incentives received from the lessor) are charged to profit or loss on a straight-line basis over the period of the lease.

(h) Business combinations

Fair values of the assets transferred;
Liabilities incurred to the former owners of the acquired business;
Equity interests issued by the Consolidated Entity;
Fair value of any asset or liability resulting from a contingent consideration arrangement; and
Fair value of any pre-existing equity interest in the subsidiary.

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. The Consolidated Entity recognises any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets.

Acquisition-related costs are expensed as incurred.

The excess of the consideration transferred plus the amount of any non-controlling interest in the acquired entity and the acquisition-date fair value of any previous equity interest in the acquired entity over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognised directly in profit or loss as a bargain purchase.

Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.

Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value with changes in fair value recognised in profit or loss.

If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from such re-measurement are recognised in profit or loss.

(i) Impairment of assets

Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.

(j) Cash and cash equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet.

LandMark White Limited 30 June 2019

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(k) Trade receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. See note 5(c) for further information about the Consolidated Entity’s accounting for trade receivables and note 10(a) for a description of the Consolidated Entity’s impairment policies.

(l) Work in progress

Client engagements in progress at the end of the reporting period are recorded in the Balance Sheet as an asset and revenue in the Statement of Profit & Loss and Other Comprehensive Income, based on the stage of completion of the engagement. The stage of completion of an engagement is determined through the use of internally developed measures that assess the progress of engagements from commencement to completion. Payments in advance are recognised as unearned income until the services are provided.

(m) Investments and other financial assets

(i) Classification

The Consolidated Entity classifies its financial assets in the following categories:

Those to be measured subsequently at fair value; and
Those to be measured at amortised cost.

The classification depends on the business model for managing the financial assets and the contractual terms of the cash flows. See note 5 for details about each type of financial asset.

(ii) Recognition and derecognition

Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either amortised cost or fair value depending on their classification. Classification is determined based on both the business model within which such assets are held and the contractual cash flow characteristics of the financial asset unless, an accounting mismatch is being avoided.

Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the consolidated entity has transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of recovering part or all of a financial asset, it's carrying value is written off.

(iii) Financial assets at fair value through profit and loss

Financial assets not measured at amortised cost or at fair value through other comprehensive income are classified as financial assets at fair value through profit or loss.

Typically, such financial assets will be either:

(i) held for trading, where they are acquired for the purpose of selling in the short-term with an intention of making a profit; or
(ii) designated as such upon initial recognition where permitted.

Fair value movements are recognised in profit or loss.

(iv) Financial assets at fair value through other comprehensive income

Financial assets at fair value through other comprehensive income include equity investments which the consolidated entity intends to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition.

Details on how the fair value of financial instruments is determined are disclosed in note 5(ii).

LandMark White Limited 30 June 2019

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(v) Impairment

The Consolidated Entity assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. In the case of equity investments classified as available-forsale, a significant or prolonged decline in the fair value of the security below its cost is considered an indicator that the assets are impaired.

(vi) Income recognition

Interest income

Interest income is recognised using the effective interest method. When a receivable is impaired, the Consolidated Entity reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loans is recognised using the original effective interest rate.

Dividends

Dividends are recognised as revenue when the right to receive payment is established. This applies even if they are paid out of pre-acquisition profits. However, the investment may need to be tested for impairment as a consequence, refer note 24(m)(v).

(n) Plant and equipment

Plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Cost may also include transfers from equity of any gains or losses on qualifying cash flow hedges of foreign currency purchases of plant and equipment.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Consolidated Entity and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.

The depreciation methods and periods used by the Consolidated Entity are disclosed in note 6(ii).

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 carrying amount. These are included in profit or loss. When revalued assets are sold, it is Consolidated Entity policy to transfer any amounts included in other reserves in respect of those assets to retained earnings.

(o) Intangible assets

(i) Goodwill

Goodwill is measured as described in note 6(c). Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill is not amortised but it is tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

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Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes.

(ii) Trademarks, licences and customer contracts

Separately acquired trademarks and licences are shown at historical cost. Trademarks, licenses and customer contracts acquired in a business combination are recognised at fair value at the acquisition date. Where they are assessed as having a finite useful life they are subsequently carried at cost less accumulated amortisation and impairment losses.

(iii) Software

Costs associated with maintaining software programmes are recognised as an expense as incurred. Development costs that are directly attributable to the design and testing of identifiable and unique software products controlled by the Consolidated Entity are recognised as intangible assets when the following criteria are met:

It is technically feasible to complete the software so that it will be available for use;
Management intends to complete the software and use or sell it;
There is an ability to use or sell the software;
It can be demonstrated how the software will generate probable future economic benefits;
Adequate technical, financial and other resources to complete the development and to use or sell the software are available; and
The expenditure attributable to the software during its development can be reliably measured.

Directly attributable costs that are capitalised as part of the software include employee costs and an appropriate portion of relevant overheads.

Capitalised development costs are recorded as intangible assets and amortised from the point at which the asset is ready for use.

(iv) Amortisation methods and periods

Refer to note 6(c) for details about amortisation methods and periods used by the Consolidated Entity for intangible assets.

(p) Trade and other payables

These amounts represent liabilities for goods and services provided to the Consolidated Entity prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method.

(q) Borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.

Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss as other income or finance costs.

LandMark White Limited 30 June 2019

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Borrowings are classified as current liabilities unless the Consolidated Entity has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

(r) Borrowing costs

Borrowing costs are expensed in the period in which they are incurred.

(s) Provisions

Provisions for legal claims and make good obligations are recognised when the Consolidated Entity has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. Provisions are not recognised for future operating losses.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as interest expense.

(t) Employee benefits

(i) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits, that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees’ services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.

(ii) Other long-term employee benefit obligations

The liabilities for long service leave and annual leave are not expected to be settled wholly within 12 months after the end of the period in which the employees render the related service. They are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the end of the reporting period of high-quality corporate bonds with terms and currencies that match, as closely as possible, the estimated future cash outflows. Re-measurements as a result of experience adjustments and changes in actuarial assumptions are recognised in profit or loss.

The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.

(iii) Post-employment obligations

The Consolidated Entity operates various defined contribution pension plans.

Pension obligations

For defined contribution plans, the Consolidated Entity pays contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis. The Consolidated Entity has no further payment obligations once the contributions have been paid. The contributions are recognised as employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.

LandMark White Limited 30 June 2019

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(iv) Share-based payments

Share-based compensation benefits are provided to employees via the LandMark White Employee Option & Performance Rights Plan and an employee share scheme. Information relating to these schemes is set out in note 20.

Employee options and performance rights

The fair value of options and performance rights granted under the LandMark White Limited Employee Option and Performance Rights Plan is recognised as an employee benefits expense with a corresponding increase in equity. The total amount to be expensed is determined by reference to the fair value of the options and performance rights granted:

Including any market performance conditions (eg the entity’s share price);
Excluding the impact of any service and non-market performance vesting conditions (eg profitability, sales growth targets and remaining an employee of the entity over a specified time period); and
Excluding the impact of any non-vesting conditions (eg the requirement for employees to save or holdings shares for a specific period of time).

The total expense is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each period, the entity revises its estimates of the number of options and performance rights that are expected to vest based on the non-market vesting and service conditions. It recognises the impact of the revision to original estimates, if any, in profit or loss, with a corresponding adjustment to equity.

Social security contributions payable in connection with an option or performance rights grant are considered an integral part of the grant itself and the charges are treated as cash-settled transactions.

The Employee Option and Performance Rights Plan is administered by the LMW Employee Share Trust, which is not consolidated. When the options or performance rights are exercised, the trust transfers the appropriate number of shares to the employee. The proceeds received net of any directly attributable transaction costs are credited directly to equity.

(v) Profit-sharing and bonus plans

The Consolidated Entity recognises a liability and an expense for bonuses and profit-sharing based on a formula that takes into consideration the profit attributable to the company’s shareholders after certain adjustments. The Consolidated Entity recognises a provision where contractually obliged or where there is a past practice that has created a constructive obligation.

(vi) Termination benefits

Termination benefits are payable when employment is terminated by the Consolidated Entity before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Consolidated Entity recognises termination benefits at the earlier of the following dates: (a) when the Consolidated Entity can no longer withdraw the offer of those benefits; and (b) when the entity recognises costs for a restructuring that is within the scope of AASB 137 and involves the payment of terminations benefits. In the case of an offer made to encourage voluntary redundancy, the termination benefits are measured based on the number of employees expected to accept the offer. Benefits falling due more than 12 months after the end of the reporting period are discounted to present value.

(u) Contributed equity

Ordinary shares are classified as equity.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

LandMark White Limited 30 June 2019

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(v) Dividends

Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the entity, on or before the end of the reporting period but not distributed at the end of the reporting period.

(w) Earnings per share

(i) Basic earnings per share

Basic earnings per share is calculated by dividing:

The profit attributable to owners of the Company, excluding any costs of servicing equity other than ordinary shares; and
By the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.
(ii) Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:

The after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares; and
The weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares.

(x) Rounding of amounts

The company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the ‘rounding off’ of amounts in the financial statements. Amounts in the financial statements have been rounded off in accordance with the instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.

(y) Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense.

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 taxation authority is included with other receivables or payables in the balance sheet.

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 taxation authority, are presented as operating cash flows.

25 Changes to accounting policies

There have been no changes to accounting policies during the financial year ended 30 June 2019.

LandMark White Limited 30 June 2019

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DIRECTORS DECLARATION

1 In the opinion of the directors of LandMark White Limited (‘the Company’):
(a) the financial statements and notes set out on pages 13 to 59 and the remuneration disclosures of the Remuneration report in the Directors' report, set out on pages 5 to 9, are in accordance with the Corporations Act 2001, including:
- (i) giving a true and fair view of the financial position of the Company and the Consolidated Entity as at 30 June 2019 and of its performance, for the financial year ended on that date; and
- (ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001;
(b) the financial report also complies with International Financial Reporting Standards as discussed in Note 24(a);
(c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable
2 The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Chief Executive Officer and Chief Financial Officer for the financial year ended 30 June 2019.

Dated at Sydney this 16[th] day of September 2019

Signed in accordance with a resolution of the directors:

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Keith Perrett Director

LandMark White Limited 30 June 2019

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LandMark White Limited

Independent auditor’s report to members

Report on the Audit of the Financial Report

Opinion

We have audited the financial report of LandMark White Limited (the Company) and its subsidiaries (the Consolidated Entity), which comprises the consolidated statement of financial position as at 30 June 2019, the consolidated statement of profit and loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information, and the directors’ declaration.

In our opinion, the accompanying financial report of the Consolidated Entity, 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 2019 and of its financial performance for the year ended on that date; and
(ii) Complying with Australian Accounting Standards and the Corporations Regulations 2001 .

Basis for Opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Consolidated Entity in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

We confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of the Consolidated Entity, would be in the same terms if given to the directors as at the time of this auditor’s report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

ACCOUNTANTS & ADVISORS

Sydney Office Level 29, 66 Goulburn Street Sydney NSW 2000

Parramatta Office Level 7, 3 Horwood Place Parramatta NSW 2150

Telephone: +61 2 8263 4000 williambuck.com

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

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AASB 15 - Revenue from contracts from customers	AASB 15 - Revenue from contracts from customers
Area of focus Refer also to note 1	How our audit addressed it
In accordance with Australian Auditing Standards there is a presumed risk of fraud in revenue recognition.	We have performed procedures to respond to the presumed risk of fraud in revenue recognition as required under Australian Auditing Standards. These procedures included: —Performed detailed controls testing to determine whether controls were operating effectively; —Performed detailed analytical procedures and other substantive testing; —Performed substantive detailed procedures to obtain assurance that occurrence and cut-off is correctly recognised; —Assessed whether AASB 15 Revenue from Contracts with Contracts is correctly applied; and —Assessed whether disclosure in the financial report is appropriate.
Valuation of the carrying value of goodwill and customer relationship intangible asset
Area of focus Refer also to notes 2, 6 (c) and 24 (o)	How our audit addressed it
The Consolidated Entity’s net assets include a significant amount of goodwill and customer relationship intangible assets. 2019: $23.9 million (2018: $27.2 million). In accordance with accounting standards, goodwill and customer relationships are subject to annual impairment testing, and for these purposes they are allocated to the appropriate cash generating units (‘CGU’). There is a risk that if the CGUs do not trade in line with expectations and forecasts, their carrying value could exceed their recoverable amount and therefore require impairment. The recoverable amount attributable to the CGUs which existed at 30 June 2019, has been calculated based on value-in-use. These recoverable amounts use discounted cash flow forecasts in which the directors make judgements over certain key inputs, for example but not limited to, revenue growth, discount rates applied, long term growth rates and inflation rates.	We have performed procedures to respond to the risk of misstatement of Goodwill and Customer Relationship, specifically the valuation of the Intangible Assets. These procedures included: —Obtaining a detailed understanding of the budgeting procedures put in place to prepare the FY2020 budget; —Evaluation of the director’s assertion that the customer relationship intangible had an indeterminate useful life at 30 June 2019; —Testing the accuracy of the calculation derived from the budget and Discounted Cash Flow (DCF) as well as assessing the key inputs in the calculations such as revenue growth, director approved forecasts and our own views; —Engaging our own valuation specialists when considering the appropriateness of the discount rates and the long-term growth rates; —Reviewing the historical accuracy of forecasts by comparing actual results with the original forecasts; —Testing the sensitivity of the DCF model to variations in the underlying assumptions; and —Assessed whether disclosure in the financial report is appropriate.

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Carrying value of the shares in Associated Company – LMW WA	Carrying value of the shares in Associated Company – LMW WA
Area of focus	How our audit addressed it
Refer also to note 2 (c)
The Consolidated Entity’s net assets include a	We have performed procedures to respond to the risk of
shares in an associated company valued at	overstatement of the shares in the Associate Company
2019: $567k (2018: $1.4m).	– LMW WA. These procedures included:
In accordance with accounting standards, interests in associates are subject to annual impairment testing, and for these purposes they	—Obtaining a detailed understanding of the budgeting procedures put in place to prepare the FY2020 budget;
are allocated to the appropriate cash generating	—Testing the accuracy of the calculation derived from
units (‘CGU’). There is a risk that if the CGUs do	the budget and Discounted Cash Flow (DCF) as
not trade in line with expectations and forecasts,	well as assessing the key inputs in the calculations
their carrying value could exceed their	such as revenue growth, director approved
recoverable amount and therefore require	forecasts and our own views;
impairment.	—Engaging our own valuation specialists when
The recoverable amount attributable to the CGUs which existed at 30 June 2019, has been	considering the appropriateness of the discount rates and the long-term growth rates;
calculated based on value-in-use. These	—Reviewing the historical accuracy of forecasts by
recoverable amounts use discounted cash flow	comparing actual results with the original forecasts;
forecasts in which the directors make	—Testing the sensitivity of the DCF model to
judgements over certain key inputs, for example	variations in the underlying assumptions; and
but not limited to, revenue growth, discount rates applied, long term growth rates and inflation rates.	—Assessed whether disclosure in the financial report is appropriate.
Business Combinations – Taylor Byrne Holdings Pty Limited
Area of focus Refer also to notes 12	How our audit addressed it

Refer also to notes 12	How our audit addressed it
As disclosed in the financial report, the parent	We have performed procedures to assess whether the
entity acquired 100% of the issued share capital	acquisition was accounted for in accordance with
of Taylor Byrne Holdings Pty Limited on 15	Accounting Standards as at 30 June 2019. These
October 2018.	procedures included:
The acquisition was settled for a maximum	—Review of the sale and purchase agreement and
purchase price of $12.5 million comprising cash	supporting documentations to understand the key
paid and shares issued on settlement.	terms and conditions of the acquisition;
The acquisition of Taylor Byrne falls under the	—Testing the determination of the fair value of the
scope of AASB 3 - Business Combinations.	consideration paid by LMW;
As a consequence of the timing of the	—Assessed LMW’s process of determining fair vales
transaction, the accounting is still provisional as	for the acquired assets, liabilities and identification
at 30 June 2019. AASB 3 allows a measurement	of any unrecognised intangibles and assessed any
period up to a maximum of 12 months from the	potential indicators of impairments;
date of the transaction to finalise the accounting.	—Reviewed Taylor Byrne Holdings Pty Limited
	completion balance sheet; and
	—Assessed the adequacy of the Consolidated
	Entity's disclosures in relation to the acquisition of
	Taylor Byrne Holding Pty Limited.

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Compliance with loan facility covenants

Area of focus
Refer also to notes 5 (e) and 10

How our audit addressed it

LMW has suffered significant impacts on its
profitability as a result of the decline in the
housing/property values, tighter bank regulations
around credit granting due to investigations by
the Banking Royal Commission and two cyber
incidents which has resulted in the inability of
LMW to satisfy several of the requirements under
the facility agreement.

We have performed procedures to assess compliance
the loan facility covenants and the consequences if the
covenants were breached and called upon. These
procedures included:
—Assessed whether LMW can satisfy the revised
requirements and terms under the facility
agreement;
—Assessed whether debt has been correctly
included, properly classified, described and
disclosed in the financial statements;
—Assessed whether debt represents amount due to
the lenders under enforceable facility agreement,
have been recorded in the financial statements;
and
—Assessed whether debt have been recorded at
their proper amounts and reflect all events and
circumstances that affect their underlying
valuation.

Other Information

The directors are responsible for the other information. The other information comprises the information in the Consolidated Entity’s annual report for the year ended 30 June 2019 but does not include the financial report and the auditor’s report thereon.

Our opinion on the financial report does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Material Uncertainty Relating to Going Concern

We draw attention to note 18 in the financial report, which indicates that the Consolidated Entity incurred a net loss of $15,148,000 during the year ended 30 June 2019 (2018: profit $4,140,000), as of that date, the Consolidated Entity’s net asset of $24,287,000 (2018: $35,635,000). As stated in Note 18, these events or conditions, along with other matters as set forth in Note 17, indicate that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter and therefore, the consolidated entity may be unable to realise its assets and extinguish its liabilities in the normal course of business and at the amounts stated in the financial report.

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Responsibilities of the Directors for the Financial Report

The directors of the Consolidated Entity are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the directors are responsible for assessing the ability of the Consolidated Entity to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Auditor’s Responsibilities for the Audit of the Financial Report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report.

A further description of our responsibilities for the audit of these financial statements is located at the Auditing and Assurance Standards Board website at http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf.

This description forms part of our independent auditor’s report.

Report on the Remuneration Report

Opinion on the Remuneration Report

We have audited the Remuneration Report included in pages 5 to 9 of the directors’ report for the year ended 30 June 2019.

In our opinion, the Remuneration Report of LandMark White Limited, for the year ended 30 June 2019, complies with section 300A of the Corporations Act 2001 .

Responsibilities

The directors of the Consolidated Entity 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.

Your faithfully,

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William Buck

Accountants & Advisors

ABN: 16 021 300 521

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L E. Tutt Partner

Sydney, 16 September 2019

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ASX ADDITIONAL INFORMATION

Additional information required by the Australian Stock Exchange Limited Listing Rules and not disclosed elsewhere in this report is set out below.

The Company was admitted to the Australian Stock Exchange under rule 1.3.2(b).

Shareholdings

Shareholdings are provided at 30 June 2019 (in line with balances disclosed in the Financial Statements) and also as at 9 September 2019 (taking into account shares issued as a result of the post balance date entitlement and shortfall offers).

Substantial shareholders

The number of shares held by substantial shareholders and their associates are set out below:

As at 30 June 2019	Number of
Shareholder	Ordinary Shares	Percentage
White Valuations Pty Ltd	10,870,134	12.59%
Microequities Asset Management Pty Ltd	8,312,250	9.76%
Mr Brad Piltz	4,501,284	5.29%
As at 6 September 2019	Number of
Shareholder	Ordinary Shares	Percentage
Newport Shipping Company Limited	13,840,755	8.89%
Redbrook Nominees Pty Ltd	13,750,000	8.83%
White Valuations Pty Ltd	10,720,134	6.89%
JP Morgan Nominees Australia Pty Ltd	8,372,382	5.38%

Voting rights

Ordinary shares Holders of ordinary shares are entitled to one vote per share at shareholder meetings. Options There are no voting rights attached to options

Distribution of equity security holders

Distribution of equity security holders
Category	As at 30 June 2019 As at 6 September 2019 Number of Shareholders Number of shares Number of Shareholders Number of shares
1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 50,000 50,001 – 100,000 100,001 and over Total	62 27,580 57 23,270 298 1,034,754 248 847,548 171 1,352,454 157 1,243,715 305 7,469,086 332 8,200,391 66 4,842,920 91 6,509,178 95 70,407,317 142 138,855,828
	997 85,134,111 1,027 155,679,930

On-market buy back There is no current on-market buy back. Marketable Parcels The number of shareholders holding less than a marketable parcel of 3,846 shares (based on closing price of $0.13 on 6 September 2019) is 161 and they hold 265,113 securities.

LandMark White Limited 30 June 2019

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Twenty largest shareholders

As at 30 June 2019
Name

Number of
Ordinary Shares
Percentage

WHITE VALUATIONS PTY LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD
MR TONY GANDEL & MRS HELEN GANDEL
MS LYNETTE JANE ELLIS & MR JEFFREY GEORGE KEANE
ARKMIST PTY LTD
CONTINUUM PROPERTY CONSULTANCY PTY LTD
IAN D BOLEWSKI PTY LTD
RAPTIS PROPERTY CONSULTANTS PTY LTD
GOGORM SUPER PTY LTD
KIUT INVESTMENTS PTY LTD
MCMULLIN NOMINEES PTY LTD
ENABLE INVESTMENT MANAGER PTY LTD
MR HAMID ROBOUBI & MRS JILLIAN ANNE ROBOUBI
MR RICCARDO PISATURO
REDBROOK NOMINEES PTY LTD
KANGALOON PTY LTD
MS CHEN ZHANG
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
COAD AND PRATT SUPERFUND PTY LTD

10,720,134
12.59%
8,312,250
9.76%
3,955,102
4.65%
3,174,105
3.73%
2,433,334
2.86%
2,433,212
2.86%
2,433,212
2.86%
2,433,212
2.86%
2,433,212
2.86%
1,932,494
2.27%
1,467,817
1.72%
1,380,000
1.62%
1,220,000
1.43%
767,914
0.90%
763,133
0.90%
750,000
0.88%
735,883
0.86%
713,531
0.84%
701,324
0.82%
700,000
0.82%

49,459,869
58.10%

As at 6 September 2019 Name	Number of Ordinary Shares Percentage
NEWPORT SHIPPING COMPANY PTY LIMITED	13,840,755 8.89%
REDBROOK NOMINEES PTY LTD PO BOX 1500	13,750,000 8.83%
WHITE VALUATIONS PTY LTD	10,720,134 6.89%
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED	8,372,382 5.38%
BNP PARIBAS NOMINEES PTY LTD	5,254,885 3.38%
ENABLE INVESTMENT MANAGER PTY LTD	3,721,000 2.39%
MS LYNETTE JANE ELLIS & MR JEFFREY GEORGE KEANE	3,558,334 2.29%
IAN D BOLEWSKI PTY LTD	3,308,212 2.13%
GOGORM SUPER PTY LTD	3,182,494 2.04%
MR TONY GANDEL & MRS HELEN GANDEL	3,174,105 2.04%
VENTURA RESOURCES PTY LTD	3,125,000 2.01%
CONTINUUM PROPERTY CONSULTANCY	3,033,212 1.95%
ARKMIST PTY LTD	2,845,712 1.83%
MR WILLIAM SIMON GAMLIN	2,763,225 1.77%
KIUT INVESTMENTS PTY LTD	2,642,071 1.70%
RAPTIS PROPERTY CONSULTANTS	2,433,212 1.56%
ACRES HOLDINGS PTY LTD	2,300,000 1.48%
MR NOEL EDWARD KAGI &	1,900,000 1.22%
MR NOEL EDWARD KAGI & MRS MICHELLE LEONIE KAGI	1,600,000 1.03%
LITTLE MORETON PTY LTD PO BOX 1500	1,410,000 0.91%
	92,934,733 59.70%

LandMark White Limited 30 June 2019

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Company secretary	John Wise
Principal registered	Level 6, 55 Clarence Street
office	Sydney NSW 2000
	Telephone 02 8823 6300
	Facsimile 02 8823 6399
	Website www.lmw.com.au
Location of share	Automic Registry Services
registry
	PO Box 2226
	Strawberry Hills NSW 2012
	Telephone 1300 288 664 (toll free within Australia)
	+61 2 9698 5414 (outside Australia)
	Email [email protected]
Stock exchange	The company is listed on the Australian Stock Exchange (“LMW”)
Other information	LandMark White Limited, incorporated and domiciled in Australia, is a publicly listed
	company limited by shares.

LandMark White Limited 30 June 2019

AI assistant

ACUMENTIS GROUP LIMITED — Annual Report 2019

64295_rns_2019-09-17_ba16a488-d2b4-4cb3-b2c3-8c9d2713495d.pdf

DIRECTORS’ REPORT

Directors

Directors Meetings

Company particulars

Corporate Governance Statement

Principal activities

Review of operations

Business Overview

Outlook

Dividends

Events subsequent to the end of the reporting period

State of affairs

Likely Developments

Environmental regulation

REMUNERATION REPORT - AUDITED

Nominations & Remuneration Committee

Remuneration policies

Directors’ and senior executive officers’ remuneration

Notes in relation to the table of directors’ and executive officers’ remuneration

(a) Analysis of options included in remuneration

Option & Performance Rights - Share Based Payments

Options

Performance Rights

(b) Analysis of bonuses included in remuneration

Contracted Commitment

Beneficial interest of directors in shares & options

Movement in shares

Director Related Entity

END OF REMUNERATION REPORT

Proceedings on behalf of the consolidated entity

Directors’ Interests

Share Options

Shares under option

Officers

Auditors

Rounding of Amounts

Auditors Independence Declaration under Section 307C of the Corporations Act 2001

Non-audit services

LandMark White Limited

Auditor’s independence declaration under section 307c of the Corporations Act 2001

William Buck

L E. Tutt

(a) Revenue from rendering of services

(b) Recovery of disbursements

(c) Recharge of shared services to licensees

2 Material profit or loss items

(a) Impairment of intangible assets

2019

2018

(b) Revision of deferred consideration

2018

(c) Impairment of investment in associated entity

2019

3 Other income and expense items

(a) Other income

(b) Finance income and expenses

4 Income tax expense

(a) Income tax (benefit) / expense

(b) Term deposits

(c) Trade and other receivables

(i) Classification as trade and other receivables

(ii) Fair values of trade and other receivables

(iii) Impairment and risk exposure

(d) Trade and other payables

(e) Borrowings

Secured liabilities

6 Non-financial assets and liabilities

(i) Recognition and measurement

(ii) Depreciation

(c) Intangible assets

(i) Goodwill & customer relationships

(ii) Subsequent expenditure

(iii) Impairment tests for goodwill & customer relationships

(iv) Revision of provisional amounts recognised

(v) Impairment charge

2019

2018

ACUMENTIS GROUP LIMITED Annual Report 2019