CPT GLOBAL LIMITED — Annual Report 2006

Oct 26, 2006

CD GIOBAT LIMITO

Annual Report 2006

Chairman's Statement

Dear Fellow CPT Global Shareholder,

Further good progress has been made over the past year in building CPT Global's Australian business and expanding our presence in international markets. While the results of this work are vet to be fully realised a strong platform has been established which should position us well for growth in the years ahead.

CPT Global's focus on client side consulting services and vendor independence are increasingly valued by our clients. Our consultants are senior, highly respected industry leaders with long tenure with CPT and within the industry.

During the past year CPT Global's strategy of providing management consulting and technology services to the Australian and international markets was reviewed and refined to ensure we continue to grow the Company in geographies suited to our expertise.

In Australia our Victorian operations remain the backbone of our business and client relationships were further strengthened and developed. Progress was also made in the ACT, NSW and Queensland markets in deepening existing relationships, adding new clients and building our resources and capability to meet demand. As a result the Australian business is well placed to build its scale and management are focused on profitable expansion in the year ahead.

I am pleased to report that in the International markets our hard work over a number of years in establishing a presence in both the United States and Europe is showing increasingly positive signs. Over the past twelve months we have expanded our anchor client relationships from one to three and activity has lifted. CPT Global now works for over half of the 20 largest financial institutions in the world and continues to deepen its relations with them as a trusted adviser.

Our revenue improved over last year but profit growth was constrained due to a lag in generating revenue from some of our international risk reward assignments which tend to be both lumpy in nature and back ended. This affected the second half result where we had expected a significant contribution from a US risk reward assignment but due to contractual changes this was varied and delayed. However CPT Global is well placed to grow particularly in our international operations where a number of risk reward assignments are maturing and our forward load across all of our regions is at an historic high.

Our dividend has been increased from 5.5 cents per share (fully franked) to 6.0 cents per share (fully franked) this year reflecting our improving underlying business performance and the positive outlook.

We were pleased to welcome lan MacDonald as a director of CPT Global in April this year. Ian was a senior member of the National Australia Bank management team prior to his recent retirement and during his 34 year career with the Bank held a number of senior executive roles in Australia and the United Kingdom and most recently was the Group CIO. Ian is already making a significant contribution as a Board member and as a mentor to senior staff.

Glenn Fielding, who had been a director of CPT Global since prior to its listing, retired from the Board in May this year to focus his substantial energies on his executive responsibilities elsewhere. Glenn contributed much to CPT Global's development and his enthusiastic involvement, wise counsel and industry knowledge will be missed.

Finally I would like to thank all of CPT Global's staff, under the active leadership of Managing Director Gerry Tuddenham, for their ongoing contribution to our success. We are fortunate to have a team of highly skilled and loyal staff and consultants who dedicate themselves to their clients' interests. Consultant care remains at the heart of our culture and we look forward to more consultants joining CPT Global in the years ahead as we continue to expand our operations both in Australia and internationally.

Fred S. Grimwade Chairman

Gerry Tuddenham, Managing Director(left) and Fred Grimwade, Chairman.

Managing Director's Review

Fellow Owners,

I am pleased to outline to you the strong position that CPT Global has achieved, and the increased confidence I have for the vears ahead.

CPT Global has been established for 13 years and this year CPT Global celebrated 5 years as a publicly listed independent IT organisation. This milestone has been achieved during one of the most challenging periods in Australian IT history and is a direct result of our understanding the market, understanding our customers and not straving from our core values and competencies.

Operating and Financial Review

Over the last five years, CPT Global has strategically set about creating a footprint in new and emerging markets. In Australia this includes Sydney and Canberra but most importantly the strategic focus is on our international business. CPT Global continues to consolidate its position in its home market of Melbourne.

This year we have managed to maintain a strong financial position whilst developing our growth markets. The profile of our risk reward assignments has meant we are only now starting to yield the returns and this is later than originally expected. However we are comfortable with this position as we now have an enhanced relationship with these clients and a pipeline of work which will create a stronger forward financial position.

CPT Global has continued ongoing development and enhancement of services including the development of consultant toolkits and refinement of intellectual property. CPT Global has also advanced our quality control processes with ISO9001:2000 quality certification to worldwide operations.

CPT Global has strengthened its market position and committed substantial energy to the continued development of its international operations. We finished the year in a strong financial and operating position and believe we are well positioned to deliver revenue and profit growth in the coming year.

This year's annual accounts have complied with the requirements of AASB 1: First-time Adoption of Australian Equivalents to International Financial Reporting Standards (AIFRS) and adjustments to the accounts resulting from the introduction of AIFRS have been applied retrospectively to the 2005 comparative figures.

CPT Global's revenue for the year ended 30 June 2006 was \$31.149 million, a 7.44% increase on the previous year's revenue of \$28.993 million.

Revenue for the majority of our international operations was generated in cost reduction services utilising the risk reward/ success fee billing model.

CPT Global stated in the December 2005 half year accounts that "Internationally Risk Reward assignments will contribute revenue and profit to the second half financial results." This contribution to both revenue and profit was not to the level expected although this contribution has only been delayed. Given the nature of the risk reward contracts we require the client to implement and validate the client benefit prior to CPT Global receiving its share and as a result some of these rewards have been delayed.

In addition, on a substantial USA risk reward contract, CPT Global has by mutual agreement given a discount to enable the contract to be extended in both duration and scope. The immediate result is that CPT Global has forgone second half revenue and profit contribution but ultimately over future years this contract will deliver a greater contribution to both revenue and profit.

CPT Global's net profit after tax for the year ended 30 June 2006 was \$2.053 million - a decrease of 10.97% on the AIFRS restated prior year's 2005 comparative figures.

All costs including those associated with the expansion of international operations as well as service development and enhancement were expensed as incurred.

As previously disclosed in the December 2005 half year consolidated accounts net profit after tax includes \$166,000 of bad debts and \$120,000 of doubtful debts in our European operations. This unexpected expense is the result of a disputed risk reward cost reduction assignment which involved a European referral partner organisation. CPT Global is endeavouring to recover the doubtful debt directly with the client, however we have taken the prudent approach of accounting for this debt as doubtful at this stage of the negotiations.

Excluding the impact of the bad and doubtful debt transaction would have resulted in an increase of 1.43% in profit after tax for the year ended 30 June 2006 on the AIFRS restated prior year's 2005 comparative figures.

Managing Director's Review continued

A final dividend of 3.25 cents per share (fully franked) has been declared, which is payable on 10th November 2006, with a record date of 25^th October 2006.

Total dividends declared and payable for the year ended 30 June 2006 were 6 cents per share (fully franked), an increase of 9% on the prior year.

CPT Global continues to maintain our policy of a high dividend payout ratio and have retained franking credits of \$1,453,000.

Earnings per share amounted to 5.96 cents per share.

CPT Global maintained its strong balance sheet position with net tangible assets at 30 June 2006 amounting to \$6.798 million (\$6.675 million at 30 June 2005).

Strategy

CPT Global recognises that its independence, intellectual property, and innovative toolsets are paramount in ensuring the delivery of the right "Client Side" outcome without bias.

Our growth will be largely driven from our entrenched capabilities and culture, and an ongoing development of a strong portfolio of services.

We are now structured to support growth targeted for each of our target markets, and to facilitate the leverage of our skills and capacity across our regions, and at reduced cost.

We shall continue to focus on the recruitment and development of leading industry experts, and to increase permanency among selected consultants to leverage our intellectual property.

CPT Global's Markets

Revenue by Industry (Worldwide)

CPT Global has taken a considered approach to growing its service offerings, ensuring that each of the Lines of Business is well managed, strategic and consistent with the corporate outlook.

CPT Global has maintained a spread of industry exposure with a continued focus on the banking, government and telecommunications sectors. We have been engaged with over half of the top twenty 2006 Fortune 500 Financial Services companies.

Managing Director's Review continued

Revenue by Line of Business (Worldwide)

CPT Global has grown its client base and now operates in a wider range of markets, and has completed work across 17 countries. Each of these markets has differing dynamics and characteristics and whilst CPT Global takes a tailored approach to growing our business within these markets, we are committed to adhering to our values of independence and client-side services.

The Melbourne market is our most developed market and represents the historic core of our business. It is however here where many of our anchor clients are emerging from a period of change brought about by outsourcing, off shoring, and centralisation. These customers are engaging CPT Global as a trusted and independent "client side" organisation to assist them in running a complex vendor supplemented services model.

In our other Australian markets, primarily Sydney, Canberra and Brisbane, CPT Global has less current client exposure, and recognises there are more growth opportunities. To this end we have installed new management teams and have targeted recruitment to supplement our existing consultant base in order to support a more accelerated approach to growth.

Our overseas markets are clearly our most exciting area for substantive growth. Here CPT Global has invested considerable effort and resources to establish a strategic foothold. We have built a sound reputation amongst some very large organisations. It is from these relationships that we are starting to increasingly realise returns from those investments.

These returns are being progressively realised in two ways;

• $\mathbf{1}$ . As we progress through current risk reward/gain share/success fee work where the revenue stream is largely back ended.
• $\overline{2}$ . From repeat business that is a direct result of recent CPT Global work and reputation. Here the work is initiated at a much lower cost than the original engagements.

CPT Global's presence overseas is also increasing in both reputation and with locally sourced consultant numbers. This is enabling us to expand our service offerings to a wider set of organisations.

Our trusted position enables us to handle more of our overseas work with consultants based in other locations, at lower cost and using remote access. For example, this year our Sydney and Melbourne resources have been able to work with our American clients from within CPT Global's Australian offices.

Traditionally much of CPT Global's business has been generated by our reputation and presence in the Technical area of a client organisation. We have now established a similar reputation amongst senior management, and the recognition and contact with Chief Financial Officers and Chief Information Officers is delivering even greater opportunities.

Managing Director's Review continued

Our People

CPT Global has always had the belief that quality people are the heart of our business. Our high consultant retention rate is representative of the focus we place on the care and management of our consultants. The stability this yields enables us to take a more strategic view of resourcing, and ensures excellence in our resourcing processes whilst our existing workforce continues to deliver quality results from our client's perspective.

CPT Global is fast tracking selected junior consultants via mentoring by our practice leaders. This initiative is ensuring we have a balanced workforce across existing and emerging technologies, and that CPT Global will continue to provide internationally recognised IT consultants in the future.

Our senior consultants continue to retain world-wide recognition as leading specialists in their field. Attendance and representation in leading publications, seminars and conferences develops the individuals and strengthens CPT Global's brand.

Outlook

I currently hold my most optimistic view of the IT market and CPT Global's place within that market.

This position is based on three key observations:

• 1. The general uplift in IT spend in all of CPT Global's targeted markets, in particular internationally.
• Acceptance that independent "client-side" external service providers are a key success factor in transforming the $\mathcal{L}$ IT organisation. This is especially relevant with an increased number of organisations operating under a Vendor/Outsourced services model and with the increasing consolidation of vendors.
• $\overline{3}$ . The incoming Business Opportunities that are progressively filling CPT Global's contracted forward load and the way our people are progressively planning and managing to realise these opportunities.

In the year ahead I am confident that in our established markets we will generate solid growth. I am particularly confident that our emerging markets will deliver a greater profit margin and result in a greater return on investment to our shareholders

$\langle \rangle$ 1 1 Hal

Gerry Tuddenham Managing Director

Contents

Directors' Report	7
Corporate Governance Statement	16
Consolidated Income Statement	19
Consolidated Balance Sheet	20
Consolidated Statement of Changes in Equity	21
Consolidated Cash Flow Statement	22
Notes to the Financial Statements	23
Directors' Declaration	56
Independent Audit Report	57
Corporate Information	59
ASX Additional Information	60

Directors' Report

Your directors submit their report for the year ended 30 June 2006.

DIRECTORS

The names and details of the company's directors in office during the financial year and until the date of this report are as follows. Directors were in office for this entire period unless otherwise stated.

Names, qualifications, experience and special responsibilities

Fred S Grimwade	Fred is an executive director of Fawkner Capital, a specialist corporate advisory firm which provides
(Non-executive Chairman)	advice on strategy, capital raisings and merger and acquisition transactions. He was managing director of the Colonial Agricultural Company, one of Australia's largest beef producers from 1998 until August 2006. Fred commenced his professional career as a commercial lawyer at Mallesons Stephen Jaques and then worked with the US investment bank Goldman, Sachs and Co. in New York and Sydney where as a vice president he directed the firm's Australasian corporate finance activities. Fred was company secretary and general manager shareholder relations at Western Mining Corporation for six years. In 1996 he joined Colonial Mutual as group company secretary and general manager legal affairs where his responsibilities included the conversion of the Group from a mutual organisation to a listed financial services company. Fred subsequently became head of private capital for Colonial First State Investments, one of Australia's largest fund managers, where he planned and managed the Group's entry into the private equity market. Fred was joint president of the Financial Services Institute of Australasia (Finsia) from 2005 until April 2006 and is also a member of the Australian Institute of Company Directors. Fred is chairman of the Finance and Audit Committee and a member of the Remuneration and Nomination Committee. Fred holds an LLB (Hons) degree, in addition to a Bachelor of Commerce degree and an MBA.
Gerry Tuddenham	Gerry is the founder of the CPT Global business and is the major shareholder in CPT Global through his majority interest in the CPT Trust. He has over 34 years experience in the IT industry and a reputation
(Managing Director)	for delivering practical solutions. He is a world-renowned technical specialist in the areas of performance tuning, capacity planning and testing of IBM mainframe-based systems, applications, transaction processors and middleware as well as database management systems. He has provided IT consulting services in a number of continents and across a range of industries including the financial, insurance and telecommunications sectors. Gerry has also developed the software tools EXPETUNE and EXPETEST, which are licensed to CPT Global. These tools automate and make repeatable intricate performance and test coverage tasks. Gerry is a member of the Australian Institute of Company Directors. Gerry is a member of the Finance and Audit Committee.
lan MacDonald	lan was appointed as a Non-executive Director of CPT Global on 7th April 2006, and as Chairman of the
(Non-executive Director)	Remuneration and Nomination Committee and a member of the Finance and Audit Committee. Ian is an executive with over thirty years of experience in Financial Services covering Banking, Wealth Management and Technology within Australia and the United Kingdom. He has broad experience in Corporate Governance, Compliance, Risk and Audit. Ian's extensive commercial experience will enhance the strength of the CPT Global Board. Ian is a member of the Australian Institute of Company Directors, Senior Fellow Financial Services Institute of Australasia (Finsia), and a Non-executive Director of Arab Bank Australia Limited.
Glenn Fielding	Glenn Fielding resigned on 12th May 2006.
(Non-executive Director)
Peter Wright	Peter has led the CPT Global management consulting practice for over five years and has established CPT as a leader in providing strategic consulting services to the government sector. He was the
(Executive Director)	national managing principal for Applications Outsourcing positions at IBM GSA and a consulting director and vice president at DMR responsible for establishing and managing the Systems Delivery and Maintenance Services practice. During this period he has been involved in a number of client engagements both locally and internationally in banking, transportation and government. Peter has a unique perspective and passion for making IT organisations and complex projects successful through the application of best practice principles. Peter is a member of the Australian Institute of Company Directors, member of the Australian Computer Society and a member of the Project Managers Institute.
COMPANY SECRETARY	Mark has been Company Secretary and Chief Financial Officer of CPT Global for four years and was
Mark Carroll	appointed Chief Operating Officer during the year. Mark holds a Bachelor of Commerce Degree and has been a Chartered Accountant for over 15 years and is also a member of the Australian Institute of Company Directors.

INTERESTS IN THE SHARES AND OPTIONS OF THE COMPANY AND RELATED BODIES CORPORATE

As at the date of this report, the interests of the directors in the shares and options of CPT Global Limited were: Ontions over

	Ordinary Shares	% Preference Shares	Openie Otel Ordinary Shares
Fred S Grimwade	708,200
Gerry Tuddenham	11,474,635
Ian MacDonald	272,511
Peter Wright	164,500		200,000
EARNINGS PER SHARE			Cents
Basic earnings per share			5.96
Diluted earnings per share			5.96
DIVIDENDS		Cents	\$
Final dividends recommended:
Fully franked final ordinary dividend recommended by the Directors and payable on 10th November 2006.		3.25	1,120,157
			1,120,157
Dividends paid in the year:
Interim for the year
Fully franked interim ordinary dividend paid on 4th April 2006.		2.75	947,825
			947,825
Final for 2005 shown as recommended in the 2005 report
Fully franked final ordinary dividend paid on 10th October 2005.		3.00	1,033,991
			1,033,991

CORPORATE INFORMATION

Nature of operations and principal activities

The principal activities of the economic entity during the financial year were the provision of specialist IT consultancy services based on the following core service offerings:

Technical Consulting Services

• ë Capacity Planning Assurance and Reviews
• Cost Reduction Programs and 'Cost of Running' Reports and Models
• Tuning Services including corporate wide approach to Performance Tuning
• Technical Support including Database and System Administration
• Technical Reviews including Environment and Application Performance
• Architecture Services including Technical Architecture and Design Reviews
• Data Warehousing Solutions
• Stress and Volume Performance Testing
• Test Facilitation and Management

Management of IT Consulting Services

• IT Strategic Planning
• Selective Outsourcing / Multi sourcing readiness support and transition services
• IT Outsourcing Contract Services Reviews
• IT Delivery and Support Reviews and Improvement using the Shared Services / ITIL framework
• Senior Project and System Integration Management
• IT Business Metrics Alignment leveraging Balanced Scorecard and 'Cost of Ownership' models
• Business Process Re engineering
• Business Process Improvement
• Information Management Planning ×
• eBusiness Planning and Implementation $\blacksquare$
• Business Requirement Definition
• × Systems and Technology Integration
• Organisation Change ×
• Records and Document Management
• Program and Project Management

There have been no significant changes in the nature of those activities during the year.

Employees

The consolidated entity employed 183 employees as at 30 June 2006 (2005: 181 employees).

OPERATING AND FINANCIAL REVIEW

The consolidated profit of the economic entity after providing for income tax amounted to \$2,053,000. Closing net assets of the economic entity were \$16,607,000, an increase of \$86,000 on the prior year as a result of the operating performance of the group. The directors recommend a final dividend of \$0.0325.

For a detailed discussion of the financial results for the year ended 30 June 2006 please refer to the Chairman's Statement and Managing Director's Review on pages 1 and 2.

SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

No significant changes in the state of affairs of the company occurred during the financial year.

SIGNIFICANT EVENTS AFTER THE BALANCE DATE

On 24th August 2006 CPT Global Limited announced its intention to extend the on-market share buy back for a further twelve months to 27th August 2007. A maximum of 3,000,000 shares may be bought back during the buy back period, which will run from 27th August 2002 until 27th August 2007.

Except for the above, no other matters or circumstances have arisen since the end of the financial vear which significantly affected or may significantly affect the operations of the economic entity, the results of those operations, or the state of affairs of the economic entity in future financial years.

LIKELY DEVELOPMENTS AND EXPECTED RESULTS

Likely developments in the operations of the economic entity and the expected results of those operations in future financial years have not been included in this report as the inclusion of such information is likely to result in unreasonable prejudice to the economic entity.

ENVIRONMENTAL REGULATION AND PERFORMANCE

The company's operations are not regulated by any significant environmental regulation under a law of the Commonwealth or of a State or Territory.

INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS

The company has paid premiums to insure the current directors and officers against liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of their conduct while acting in the capacity of director and officer of the company, other than conduct involving a wilful breach of duty in relation to the company. The total premium paid was \$43.900.

REMUNERATION REPORT

Remuneration policy

The Remuneration and Nomination Committee of the Board of Directors is responsible for determining and reviewing compensation arrangements for the directors, the managing director and the executive team. The Remuneration and Nomination Committee assesses the appropriateness of the nature and amount of emoluments of such officers on a periodic basis by reference to relevant employment market conditions with the overall objective of ensuring maximum stakeholder benefit from the retention of a high quality Board and executive team. The outcomes of the remuneration structure are expected to comply with Executive Share and Option Scheme Guidelines, IFSA Guidance Note, Investment and Financial Services Association, 2003. The payment of bonuses, stock options and other incentive payments are reviewed by the Remuneration and Nomination Committee annually as part of the review of executive remuneration and a recommendation is put to the Board for approval. All bonuses, options and incentives must be linked to pre-determined performance criteria. The Board can exercise its discretion in relation to approving the incentives, bonuses and options and can recommend changes to the Committee's recommendations. Any changes must be justified by reference to measurable performance criteria. During the 2006 and 2005 financial years, no such incentives or payments were recommended. Further details on the remuneration of directors and executives are provided in Note 29 to the financial statements.

To assist in achieving these objectives, the Remuneration and Nomination Committee links the nature and amount of executive directors' and officers' emoluments to the company's financial and operational performance and shareholders value.

Performance-based remuneration

Annual salary reviews are linked directly to directors' and executives' achievements of key performance indicators (KPIs). The KPIs are set annually after consultation with the directors and executives. The measures are specifically tailored to the areas where each executive has a level of control. The KPIs target areas the Board believes hold the greatest potential for expansion and profit, covering financial and non-financial goals as well as short and long-term goals.

The Board may, at its discretion, award bonuses for exceptional performance in relation to the pre-agreed KPIs.

Company performance, shareholder wealth and director and executive remuneration

The remuneration policy has been tailored to increase goal congruence between shareholders, directors and executives. There have been two methods applied in achieving this aim, the first being annual salary reviews based on key performance indicators, and the second being the issue of options to selected directors and executives to encourage the alignment of personal and shareholder interests. The company believes this policy to have been effective in increasing shareholder wealth over the past five years.

The following table shows the net profit and dividends for the last five years for the listed entity, as well as the share price at the end of the respective financial years. Analysis of the actual figures shows an increase in profit trend apart from the current year (the reasons for which are discussed in the Managing Director's Review) as well as an increase in dividends paid to shareholders. The improvement in the company's performance over the last five years has been reflected in the improvement in company's share price with an increase each year, with the exception of the current year, when the share price fell slightly. The board is of the opinion that these results can be attributed in part to the previously described remuneration policy and is satisfied that this continued improvement has lead to increased shareholder wealth over the past 5 years.

	2002	2003	2004	2005	2006
Net profit	S1.250m	S2.140m	S2.114m	\$2.306	S2.053m
Share price at year end	SO.55	\$0.58	\$0.64	S0.66	S0.62
Dividends paid	2.0c	5.0c	5.0c	5.5c	6.0c

During the year, no shares were purchased as part of the share buyback. The share price during the year range from a low of \$0.56 to a high of \$0.745.

Details of remuneration for the year ended 30 June 2006

Details of the nature and amount of each element of the emoluments¹ of each director of the company and executive officers of the company and the consolidated entity receiving the highest emolument for the financial year are as follows:

				Short - Term Benefits
Directors	Salary, Fees Cash bonus Non-cash and Commi- ssions		Benefits	Options 2	Total Remun- eration Repres- ented by Options	Super- annuation Contribut- ion	Total	Performance related
	\$	\$	\$.	\$.	X	\$	S.	%
Fred S Grimwade
2006 ۳	59,633					5,367	65,000
2005 ٠	49,835					4,485	54,320
Gerry Tuddenham
2006 ш	225,157					100,587	325,744
2005 ш	211,373		$\overline{\phantom{a}}$	16,175	5.00	95,980	323,528
Glenn Fielding 3
2006 ٠	24,083					2,167	26,250
2005	32,110					2,890	35,000
lan MacDonald 4
2006 ٠	35,015					3,151	38,166
2005 ш.
Peter Wright
2006 ш	271,277	45,872		276	0.06	117,851	435,276	10,5
2005 ш	244,884			1,070	0.30	87,861	333,815
Total Remuneration
2006 ш	615,165	45,872		276	0.03	229,123	890,436
2005 ٠	538,202			17,245	2.31	191,216	746,663

				Short - Term Benefits
Executive officers5	Salary, Fees Cash bonus and Commi- ssions		Non-cash Benefits	Options 2	Total Remun- eration Repres- ented by Options	Super- annuation Contr- ibution	Total	Performance related
	\$.	S.	\$.	\$.	X	S	S.	X
Alan Mackenzie
2006	242,784				۰	21,851	264,635
2005	247.713		$\overline{\phantom{a}}$		$\overline{\phantom{a}}$	22.294	270,007
Mark Carroll
2006	165,665	5,000				24,720	195,385	2,6
2005 ٠	137,615				$\sim$	12,385	150,000
Total Remuneration
2006 ■	408,449	5,000			۰.	46,571	460,020
2005	385,328					34.679	420,007

Notes

The terms 'director' and 'officer' have been treated as mutually exclusive for the purposes of this disclosure.

• 1 The elements of emoluments have been determined on the basis of the cost to the company and the consolidated entity.
• $\overline{2}$ Options granted as part of director and executive emoluments have been valued using the Black Scholes option pricing model, which takes account of factors including the option exercise price, the current level and volatility of the underlying share price, the risk-free interest rate, current market price of the underlying share and the expected life of the option.
• $\overline{3}$ Resigned 12th May 2006.
• $\overline{4}$ Appointed 7th April 2006.
• 5 Executives are those directly accountable and responsible for the operational management and strategic direction of the company and the consolidated entity.

Performance income as a proportion of total remuneration

Executive directors and executives are paid performance related bonuses based on set monetary figures, rather than proportions of salary since these payments are discretionary. This has led to the proportions of remuneration related to performance varying between individuals.

Options issued as part of remuneration for the year ended 30 June 2006

The following table details options issued, exercised and lapsed during the year:

	Balance at beginning of period 1 July 2005	Granted as Remuneration	Options Exercised	Options Lapsed	Balance at end of period 30 June 2006
Gerry Tuddenham	250,000			(250,000)
Peter Wright	300,000	$\overline{\phantom{000000000000000000000000000000000000$	$\overline{\phantom{a}}$	(100,000)	200,000
Total	550,000		$\overline{\phantom{0}}$	(350,000)	200,000

Employment contracts of directors and specified executives

Both executive directors and the executives specified in this remuneration report and notes to the accounts, have their employment conditions formalised in contracts of employments. All non-executive directors and specified executives are permanent employees of CPT Global Limited.

The employment contracts stipulate one month notice periods and do not contain any provisions for termination payments. Any options not vested as at the date of termination will lapse.

For details of contracts under which directors are entitled to a benefit, refer to Note 29(f)

DIRECTORS' MEETINGS

The number of meetings of directors (including meetings of committees of directors) held during the year and the number of meetings attended by each director were as follows:

	Directors' Meetings		Finance and Audit Committee Meetings		Remuneration and Nomination Committee Meetings
	Number eligible to attend	Number attended	Number eligible to attend	Number attended	Number eligible to attend	Number attended
Fred S Grimwade	11	11
Gerry Tuddenham	11	11	2	2
Glenn Fielding*	9	9	2	2
lan MacDonald +		2
Peter Wright	11	11

Committee membership

As at the date of this report, the company had a Finance and Audit Committee and a Remuneration and Nomination Committee of the Board of Directors.

Members acting on the committees of the Board during the year were:

Finance and Audit	Remuneration and Nomination
Fred Grimwade (C)	lan MacDonald' (C)
Gerry Tuddenham	Fred Grimwade
lan MacDonald*	Glenn Fielding*
Glenn Fielding*
Notes
Resigned 12 th May 2006 *.

• • Appointed 7^th April 2006
• (C) Designates the chairman of the committee.

OPTIONS

At the date of this report, the unissued ordinary shares of CPT Global Limited under option are as follows:

Grant date	Expiry date	Exercise price	Number of options
26/11/03	27/11/06	\$1.00	100.000
26/11/03	27/11/07	\$1.00	100.000
			200,000

During the year ended 30 June 2006, there were no ordinary shares issued on the exercise of options. No options were granted during the year. Details of options that lapsed during the year can be found in Note 29.

No person entitled to exercise the option had or has any right by virtue of the option to participate in any share issue of any other body corporate.

PROCEEDINGS ON BEHALF OF COMPANY

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

NON-AUDIT SERVICES

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

• all non-audit services are reviewed and approved by the Finance and Audit Committee prior to commencement. to ensure they do not adversely affect the integrity and objectivity of the auditor; and
• the nature of the services provided do not compromise the general principles relating to auditor independence as set out in the Institute of Chartered Accountants in Australia and CPA Australia's Professional Statement F1: Professional Independence.

The following fees for non-audit services were paid/payable to the external auditors during the year ended 30 June 2006:

• Taxation services \$30,000
• Other services \$23,000

AUDITOR'S INDEPENDENCE DECLARATION

The lead auditor's independence declaration for the year ended 30 June 2006 has been received and can be found on page 15 of the directors' report.

ROUNDING

The amounts contained in this report and in the financial report have been rounded to the nearest \$1,000 (where rounding is applicable) under the option available to the company under ASIC Class Order 98/0100. The company is an entity to which the Class Order applies.

CORPORATE GOVERNANCE

In recognising the need for the highest standards of corporate behaviour and accountability, the directors of CPT Global Limited support and have adhered to the principles of corporate governance. The company's corporate governance statement is contained in the following section of this annual report.

Signed in accordance with a resolution of the directors.

Julial

Gerry Tuddenham Managing Director

Melbourne, 4th September 2006

Auditors Independence Declaration

MOORE STEPHENS

AUDITOR'S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001 TO THE DIRECTORS OF CPT GLOBAL LIMITED AND CONTROLLED ENTITIES

I declare that, to the best of my knowledge and belief, during the year ended 30 June 2006 there have been:

• No contraventions of the auditor independence requirements as set out in the Corporations $(i)$ Act 2001 in relation to the review, and
• No contraventions of any applicable code of professional conduct in relation to the review. $(ii)$

MOORE STEPHENS

てび --

S David Pitt Partner Melbourne, 4 September 2006

Moore Stephens ABN 39 533 589 331 14th Floor, 607 Bourke Street, Melbourne, Victoria, 3000 Australia Telephone: +61 3 9614 444 Email: melbourne@moorestephens.com.au Web:www.moorestephens.com.au A member of the Moore Stephens International Limited Group of Independent Firms A separate partnership in Victoria

Kevin W. Neville Kevin w. Nevine
Stephen J. O'Flyan
Robin C. Penaell
S. David Pitr Grant M. Sincock
Jonathan C. Thomas

Corporate Governance Statement

The Board of Directors of CPT Global is responsible for the corporate governance of the consolidated entity. The Board guides and monitors the business and affairs of CPT Global on behalf of the shareholders by whom they are elected and to whom they are accountable.

The format of the Corporate Governance Statement is based on the Australian Stock Exchange Corporate Governance Council's (the Council's) "Principles of Good Corporate Governance and Best Practice Recommendations" (the Recommendations). In accordance with the Council's recommendations, the Corporate Governance Statement must now contain certain specific information and must disclose the extent to which the company has followed the guidelines during the period. Where a recommendation has not been followed, that fact must be disclosed, together with the reasons for the departure. CPT Global's Corporate Governance Statement is structured with reference to the Corporate Governance Council's principles and recommendations, which are as follows:

• Principle 1. Lay solid foundations for management and oversight ×
• Principle 2. Structure the Board to add value
• Principle 3. Promote ethical and responsible decision making ×
• Principle 4. Safeguard integrity in financial reporting
• Principle 5. Make timely and balanced disclosure
• Principle 6. Respect the rights of shareholders j.
• Principle 7. Recognise and manage risk ×
• Principle 8. Encourage enhanced performance
• Principle 9. Remunerate fairly and responsibly
• Principle 10 Recognise the legitimate interests of stakeholders

Independence

Corporate Governance Council Recommendation 2.1 requires a majority of the Board to be independent directors. In addition, recommendation 2.2 requires the chairperson of the company to be independent. The Corporate Governance Council defines independence as being free from any business or other relationship that could materially interfere with - or could reasonably be perceived to materially interfere with - the exercise of unfetted and independent judgement. In accordance with this definition, the following directors are not considered to be independent:

• Gerry Tuddenham (Managing Director) ۰
• Peter Wright (Executive Director)

Of the four Board members, the two listed above are not considered to be independent when applying the Council's definition of independence. However when considering the casting vote of the independent chairman, the majority of the Board is independent. CPT Global considers industry experience and specific expertise to be important attributes of its Board members.

CPT Global's corporate governance practices were in place throughout the year ended 30 June 2006. The corporate governance practises of CPT Global were compliant with the Council's best practice recommendations.

For further information on corporate governance policies adopted by CPT Global, refer to our website: www.CPTglobal.com

Corporate Governance Statement continued

Structure of the Board

The skills, experience and expertise relevant to the position of director held by each director in office at the date of the annual report is included in the directors' report on page 7. Directors of CPT Global are considered to be independent when they are independent of management and free from any business or other relationship that could materially interfere with - or could reasonably be perceived to materially interfere with - the exercise of their unfettered and independent judgement.

In the context of director independence, "materiality" is considered from both the company and individual director perspective. The determination of materiality requires consideration of both quantitative and qualitative elements. An item is presumed to be quantitatively immaterial if it is equal or less than 5% of the appropriate base amount. It is presumed to be material (unless there is qualitative evidence to the contrary) if it is equal to or greater than 10% of the appropriate base amount. Qualitative factors considered include whether a relationship is strategically important, the competitive landscape, the nature of the relationship and the contractual or other arrangements governing it and other factors which point to the actual ability of the director in question to shape the direction of the company's loyalty.

In accordance with the definition of independence above, and the materiality thresholds set, the following directors of CPT Global are considered to be independent:

Name	Position
Fred Grimwade	Non-executive Chairman
Ian MacDonald	Non-executive Director

There are procedures in place, agreed by the Board, to enable directors, in furtherance of their duties, to seek independent professional advice at the company's expense.

The term in office held by each director in office at the date of this report is as follows:

Name	Term in office
Fred Grimwade	4 years
Ian MacDonald	3 months
Gerry Tuddenham	8 years
Peter Wright	5 years

Performance Evaluation

An annual performance evaluation of the Board and all Board members was conducted by the full Board for the financial year ended 30 June 2006. The Board developed a questionnaire for all Board members to provide feedback on how they thought the Board had performed. The results from the questionnaire were collated and discussed by the Board. The Board developed a series of recommendations to improve performance and an action plan to implement the recommendations and set the performance criteria and goals for the next year.

Remuneration and Nomination Committee

The Board has established a Remuneration and Nomination Committee which meets to ensure that the Board continues to operate within the established guidelines, including when necessary, selecting candidates for the position of director. The Committee is also responsible for ensuring that adequate resourcing levels are maintained, setting and monitoring employment conditions, reviewing the performance of executive directors and senior management and setting the scale of their remuneration. The Remuneration and Nomination Committee comprises all of the non-executive directors. The Remuneration and Nomination Committee comprised the following members throughout the year:

• lan MacDonald (C)
• Fred Grimwade
• × Glenn Fielding (resigned 12^th May 2006)

For details of directors' attendance at meetings of the Remuneration and Nomination Committee, refer to page 13 of the Directors' Report.

For additional details regarding the Remuneration and Nomination Committee, please refer to our website.

Corporate Governance Statement continued

Finance and Audit Committee

The Board has established a Finance and Audit Committee, which operates under a charter approved by the Board. It is the Board's responsibility to ensure that an effective internal control framework exists within the entity. This includes internal controls to deal with both the effectiveness and efficiency of significant business processes, the safeguarding of assets, the maintenance of proper accounting records, and the reliability of financial information as well as non-financial considerations such as the benchmarking of operational key performance indicators. The Board has delegated the responsibility for the establishment and maintenance of a framework of internal control and ethical standards for the management of the consolidated entity to the Finance and Audit Committee.

The Committee also provides the Board with additional assurance regarding the reliability of financial information for inclusion in the financial reports. The Corporate Governance Principles recommend that all Finance and Audit Committee members are non-executive. CPT Global only has two non-executive directors therefore the managing director has also been appointed to the Finance and Audit Committee.

The members of the Finance and Audit Committee during the year were:

• Fred Grimwade (C)
• lan MacDonald
• Gerry Tuddenham
• Glenn Fielding (resigned 12^th May 2006)

Risk Management

CPT Global takes a proactive approach to risk management. The Board is responsible for ensuring that risks, and also opportunities, are identified on a timely basis and that the group's objectives and activities are aligned with the risks and opportunities identified by the Board.

The group believes that it is crucial for all Board members to be a part of this process, and as such the Board has not established a separate risk management committee. Instead sub-committees are convened as appropriate in response to issues and risks identified by the Board as a whole, and the sub-committee further examines the issue and reports back to the Board.

The Board has a number of mechanisms in place to ensure that management's objectives and activities are aligned with the risks identified by the Board. These include:

• × Board approval of a strategic plan, which encompasses the entity's vision, mission and strategy statements, designed to meet stakeholders' needs and manage business risk.
• Implementation of Board approved operating plans and budgets and Board monitoring of progress against these budgets, including the establishment and monitoring of Key Performance Indicators (KPI's) of both a financial and non-financial nature.
• The establishment of committees to report on specific business risks, including for example, such matters as the financial risks and concerns and occupational health and safety.

Trading Policy

The company's policy regarding directors and employees trading in its securities is set by the Finance and Audit Committee. The policy restricts directors and employees from acting on material information until it has been released to the market and adequate time has been given for this to be reflected in the securities price.

Consolidated Income Statement

YEAR ENDED 30 JUNE 2006	Notes	Economic Entity		Parent Entity
		2006	2005	2006	2005
		\$'000	\$'000	\$'000	\$'000
REVENUE	3.	31,149	28,993	29,205	26,562
Changes in inventories of finished goods and work in progress		1,522	831	443	64
Raw materials and consumables used.		(1, 522)	(831)	(443)	(64)
Depreciation and amortisation expenses	4	(121)	(133)	(120)	(131)
Finance costs expense	4	(2)		(5)
Salaries and employee benefits expense		(2, 273)	(1,759)	(2,018)	(1, 541)
Consultants benefits expense		(22, 182)	(20, 679)	(21, 041)	(19, 237)
Lease expenses		(398)	(401)	(389)	(386)
Insurance expense		(249)	(251)	(237)	(251)
Other expenses from ordinary activities		(2,738)	(2, 506)	(2,304)	(1, 836)
PROFIT BEFORE INCOME TAX EXPENSE		3,186	3,264	3,091	3,180
INCOME TAX EXPENSE	5	(1, 133)	(958)	(927)	(939)
PROFIT AFTER INCOME TAX EXPENSE		2,053	2,306	2,164	2,241
NET PROFIT		2,053	2,306	2,164	2,241
NET PROFIT ATTRIBUTABLE TO MEMBERS OF CPT GLOBAL LIMITED	21	2,053	2,306	2,164	2,241
Basic earnings per share (cents per share)	27	5.96	6.69
Diluted earnings per share (cents per share)	27	5.96	6.69
Franked dividends per share (cents per share)	6	6.0	5.5

The Income Statement is to be read in conjunction with the Notes to the Financial Statements.

Consolidated Balance Sheet

AT 30 JUNE 2006	Notes	Economic Entity		Parent Entity
		2006	2005	2006	2005 \$'000
		\$'000	\$'000	\$'000
CURRENT ASSETS
Cash and cash equivalents	7	2,498	2,241	2,036	1,878
Trade and other receivables	8	5,309	6,192	6,822	6,580
Inventories	9	3,101	1,581	646	205
Deferred tax assets	17	145	111	145	111
Other	10	270	417	212	397
TOTAL CURRENT ASSETS		11,323	10,542	9,861	9,171
NON-CURRENT ASSETS
Trade and other receivables	11			659	488
Other financial assets	12			730	730
Property, plant and equipment	14	204	238	205	237
Intangible assets	15	9,809	9,846	9,178	9,215
TOTAL NON-CURRENT ASSETS		10,013	10,084	10,772	10,670
TOTAL ASSETS		21,336	20,626	20,633	19,841
CURRENT LIABILITIES
Trade and other payables	16	3,037	3,102	2,812	2,759
Current tax liabilities	17	604	453	379.	446
Other	18	1,042	529	1,051	452.
TOTAL CURRENT LIABILITIES		4,683	4,084	4,242	3,657
NON-CURRENT LIABILITIES
Provisions	19	46	21	46	21
TOTAL NON-CURRENT LIABILITIES		46	21	46	21
TOTAL LIABILITIES		4,729	4,105	4,288	3,678
NET ASSETS		16,607	16,521	16,345	16,163
EQUITY
Parent entity interest
Issued capital ٠	20	12,075	12,075	12,075	12,075
Reserves ۰	21	40	25
Retained profits	21	4,492	4,421	4,270	4,088
Total parent entity interest in equity		16,607	16,521	16,345	16, 163
TOTAL EQUITY		16,607	16,521	16,345	16,163

The Balance Sheet is to be read in conjunction with the Notes to the Financial Statements.

Consolidated Statement of Changes in Equity

YEAR ENDED 30 JUNE 2006

	\$'000	\$'000	\$'000	\$'000
			Foreign
	Share		Currency
	capital	Retained	Translation
Economic Entity	Ordinary	Profits	Reserve	Total
Balance at 1 July 2004	12,075	4,010	32	16,117
Profit attributable to members of parent entity		2,306		2,306
Transfers to and from exchange reserve			(7)	(7)
Sub-total	12,075	6,316	25	18,416
Dividends paid or provided for		(1, 895)		(1, 895)
Balance as at 30 June 2005	12,075	4,421	25	16,521
Balance at 1 July 2005	12,075	4,421	25	16,521
Profit attributable to members of parent entity		2,053		2,053
Transfers to and from exchange reserve			15	15
Sub-total	12,075	6,474	40	18,589
Dividends paid or provided for		(1,982)		(1,982)
Balance as at 30 June 2006	12,075	4,492	40	16,607
	\$'000	\$'000		\$'000
	Share
	capital	Retained
Parent Entity	Ordinary	Profits		Total
Balance at 1 July 2004	12,075	3,742		15,817
Profit attributable to members of parent entity		2,241		2,241
Sub-total	12,075	5,983		18,058
Dividends paid or provided for		(1, 895)		(1, 895)
Balance as at 30 June 2005	12,075	4,088		16,163
Balance at 1 July 2005	12,075	4,088		16,163
Profit attributable to members of parent entity		2,164		2,164
Sub-total	12,075	6,252		18,327
Dividends paid or provided for		(1,982)		(1,982)
Balance as at 30 June 2006	12,075	4,270		16,345

The Statement of Changes in Equity is to be read in conjunction with the Notes to the Financial Statements.

Consolidated Cash Flow Statement

YEAR ENDED 30 JUNE 2006	Notes	Economic Entity		Parent Entity
		2006	2005	2006	2005
		\$'000	\$'000	\$'000	\$'000
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers		32,130	30,189	29,172	26,546
Payments to suppliers and employees		(28, 902)	(27, 485)	(25, 888)	(24, 398)
Interest received		61	75	108	72
Finance costs		(1)		(5)
Income tax paid		(1, 015)	(1,006)	(1,027)	(883)
NET CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES	22(a)	2,273	1,773	2,360	1,337
CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of property, plant and equipment		$\overline{2}$	8	2	8
Purchase of property, plant and equipment		(51)	(169)	(51)	(170)
NET CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES		(49)	(161)	(49)	(162)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings - other					403
Repayments of borrowings - other				(171)
Payment of dividends on ordinary shares		(1,982)	(1, 895)	(1,982)	(1, 895)
NET CASH FLOWS FROM/(USED IN) FINANCING ACTIVITIES		(1,982)	(1,895)	(2, 153)	(1, 492)
NET INCREASE/(DECREASE) IN CASH HELD		242	(283)	158	(317)
Add opening cash brought forward		2,241	2,530	1,878	2,195
Effects of exchange rate changes on cash		15	(6)
CLOSING CASH CARRIED FORWARD	7	2,498	2,241	2,036	1,878

The Cash Flow Statement is to be read in conjunction with the Notes to the Financial Statements.

Notes to the Financial Statements

YEAR ENDED 30 JUNE 2006

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES $\mathbf{1}$

The financial consolidated financial statements are a general purpose financial report prepared in accordance with the requirements of the Corporations Act 2001. Australian Accounting Standards, Urgent Issues Group Interpretations and other authoritative pronouncements of the Australian Accounting Standards Board.

The financial report of CPT Global Limited and controlled entities, and CPT Global Limited as an individual parent entity comply with all Australian equivalents to International Financial Reporting Standards (AIFRS) in their entirety.

The following is a summary of the material accounting policies adopted by the economic entity in the preparation of the financial report. The accounting policies have been consistently applied, unless otherwise stated.

(a) Basis of preparation

In accordance with the requirements of AASB 1: First-time Adoption of Australian Equivalents to International Financial Reporting Standards, adjustments to the parent entity and economic entity accounts resulting from the introduction of AlfRS have been applied retrospectively to 2005 comparative figures excluding cases where optional exemptions available under AASB 1 have been applied. These consolidated accounts are the first financial statements of CPT Global Limited to be prepared in accordance with Australian equivalents to IFRS. Reconciliations of the transition from previous Australian GAAP to AIFRS have been included in Note 2 to this report.

The accounting policies set out below have been consistently applied to all years presented. The parent and consolidated entities have however elected to adopt the exemptions available under AASB 1 relating to AASB 132: Financial Instruments: Disclosure and Presentation, AASB 139: Financial Instruments: Recognition and Measurement and AASB 2: Share-based Payments.

The financial report has been prepared on an accruals basis and is based on historical costs and does not take into account changing money values or, except where stated, current valuations of non current assets. Cost is based on the fair values of the consideration given in exchange for assets.

The financial report covers the economic entity of CPT Global Limited and controlled entities, and CPT Global Limited as an individual parent entity. CPT Global Limited is a listed public company, incorporated and domiciled in Australia.

(b) Principles of consolidation

The consolidated financial statements are those of the consolidated entity, comprising CPT Global Limited (the parent entity) and all entities which CPT Global Limited controlled from time to time during the year and at balance date. A list of controlled entities is contained in Note 13 to the financial statements. All controlled entities have a June financial vear-end.

Information from the financial statements of subsidiaries is included from the date the parent company obtains control until such time as control ceases. Where there is loss of control of a subsidiary, the consolidated financial statements include the results for the part of the reporting period during which the parent company has control.

The financial statements of subsidiaries are prepared for the same reporting period as the parent entity, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies which may exist.

All inter-company balances and transactions, including unrealised profits arising from intra-group transactions, have been eliminated in full. Unrealised losses are eliminated unless costs cannot be recovered.

YEAR ENDED 30 JUNE 2006

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) $\mathbf{1}$

(c) Income Tax

The charge for current income tax expense is based on the profit for the year adjusted for any non-assessable or disallowable items. It is calculated using tax rates that have been enacted or are substantively enacted at the balance sheet date.

Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination. where there is no effect on accounting or taxable profit or loss.

Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or liability is settled. Deferred tax is credited in the income statement except where it relates to items that may be credited directly to equity, in which case the deferred tax is adjusted directly against equity.

Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be available against which deductible temporary differences can be utilised.

The amount of benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that the economic entity will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law.

(d) Foreign Currency Transactions and Balances

Functional and presentation currency

The functional currency of each of the group's entities is measured using the currency of the primary economic environment in which that entity operates. The consolidated financial statements are presented in Australian dollars which is the parent entity's functional and presentation currency.

Transaction and balances

Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.

Exchange differences arising on the translation of monetary items are recognised in the income statement, except where they are deferred in equity as a qualifying cash flow or net investment hedge.

Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in the income statement.

Group companies

The financial results and position of foreign operations whose functional currency is different from the group's presentation currency are translated as follows:

Assets and liabilities are translated at year-end exchange rates prevailing at that reporting date. Income and expenses are translated at average exchange rates for the period. Retained profits are translated at the exchange rates prevailing at the date of the transaction.

Exchange differences arising on translation of foreign operations are transferred directly to the group's foreign currency translation reserve in the balance sheet. These differences are recognised in the income statement in the period in which the operation is disposed.

YEAR ENDED 30 JUNE 2006

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) $1₁$

(e) Cash and cash equivalents

Cash on hand and in banks and short-term deposits are stated at nominal value.

For the purposes of the Cash Flow Statement, cash includes cash on hand and in banks, and money market investments with original maturities of 3 months or less, net of outstanding bank overdrafts.

Bank overdrafts are carried at the principal amount. Interest is charged as an expense as it accrues.

(f) Financial Instruments

Recognition

Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related contractual rights or obligations exist. Subsequent to initial recognition these instruments are measured as set out helow

Financial assets at fair value through profit and loss

A financial asset is classified in this category if acquired principally for the purpose of selling in the short term or if so designated by management and within the requirement of AASB 139: Recognition and Measurement of Financial Instruments. Derivatives are also recognised as held for trading unless they are designated as hedges. Realised and unrealised gains and losses arising from changes in the fair value of these assets are included in the income statement in the period in which they arise.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are stated at amortised cost using the effective interest rate method.

Held-to-maturity investments

These investments have fixed maturities, and it is the group's intention to hold these investments to maturity, Any held-to-maturity investments held by the group are stated at amortised cost using the effective interest rate method.

Available-for-sale financial assets

Available for sale financial assets include any financial assets not included in the above categories. Available for sale assets are reflected at fair value. Unrealised gains and losses arising from changes in fair value are taken directly to equity.

Financial liabilities

Non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and amortisation.

Fair value

Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for all unlisted securities, including recent arm's length transactions, reference to similar instruments and option pricing models.

Impairment

At each reporting date, the group assess whether there is objective evidence that a financial instrument has been impaired. In the case of available-for sale financial instruments, a prolonged decline in the value of the instrument is considered to determine whether impairment has arisen. Impairment losses are recognised in the income statement,

YEAR ENDED 30 JUNE 2006

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

(g) Receivables

Trade receivables are recognised and carried at original invoice amount less impairment for any uncollectible debts. An estimate for impairment of doubtful debts is made when collection of the full amount is no longer probable. Bad debts are written-off as incurred.

Receivables from related parties are recognised and carried at the nominal amount due. Interest is taken up as income on an accrual basis.

(h) Inventories

Work in progress is valued at cost plus profit recognised to date less any provision for anticipated future losses. Cost includes both variable and fixed costs relating to specific contracts, and those costs that are attributable to the contract activity in general and that can be allocated on a reasonable basis.

Profits are recognised on the stage of completion basis measured using the proportion of costs incurred to date as compared to expected total costs. Where losses are anticipated they are provided for in full.

Revenue has been recognised on the basis of the terms of the contract adjusted for any variations or claims allowable under the contract.

(i) Property, plant and equipment

Plant and equipment is measured on the cost basis less, where applicable, any accumulated depreciation or amortisation and impairment losses.

The depreciable amount of all fixed assets is depreciated on a diminishing value basis over their useful lives to the company commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.

Depreciation

The depreciation rates used for each class of depreciable assets are:

Class of Fixed Asset:	Depreciation Rate
Fixtures Fittings and Equipment	22.5% to 50%
Leasehold improvements	20%
Plant and Machinery	11% to 60%

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.

An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the income statement. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings.

YEAR ENDED 30 JUNE 2006

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) $\mathbf{1}$ .

(i) Intangibles

Goodwill

Goodwill and goodwill on consolidation are initially recorded at the amount by which the purchase price for a business or for an ownership interest in a controlled entity exceeds the fair value attributed to its net assets at date of acquisition. Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill on acquisition of associates is included in investments in associates. Goodwill is tested annually for impairment and 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.

(k) Impairment of Assets

At each reporting date, the group reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset's fair value less costs to sell and value in use, is compared to the asset's carrying value. Any excess of the asset's carrying value over its recoverable amount is expensed to the income statement.

Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.

Where it is not possible to estimate the recoverable amount of an individual asset, the group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

(I) Payables

Liabilities for trade creditors and other amounts are carried at cost which is the fair value of the consideration to be paid in the future for goods and services received, whether or not billed to the consolidated entity.

Payables to related parties are carried at the principal amount. Interest, when charged by the lender, is recognised as an expense on an accrual basis.

Deferred cash settlements are recognised at the present value of the outstanding consideration payable on the acquisition of an asset discounted at prevailing commercial borrowing rates.

(m) Provisions

Provisions are recognised when the economic entity has a legal, equitable or constructive obligation to make a future sacrifice of economic benefits to other entities as a result of past transactions or other past events, it is probable that a future sacrifice of economic benefits will be required and a reliable estimate can be made of the amount of the obligation.

A provision for dividends is not recognised as a liability unless the dividends are declared, determined or publicly recommended on or before the reporting date.

YEAR ENDED 30 JUNE 2006

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) $\blacksquare$

(n) Issued Capital

Issued and paid up capital is recognized at the fair value of the consideration received by the company.

Any transaction costs arising on the issue of ordinary shares are recognized directly in equity as a reduction of the share proceeds received.

(o) Revenue recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the entity and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognised:

Sale of Goods

Control of the goods has passed to the buyer.

Rendering of Services

Where the contract outcome can be reliably measured, control of the right to be compensated for the services and the stage of completion can be reliably measured. Stage of completion is measured by reference to the labour hours incurred to date as a percentage of total estimated labour hours for each contract.

Where the contract outcome cannot be reliably measured, revenue is recognised only to the extent that costs have been incurred.

Interest

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

(p) Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of GST except:

• where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
• receivables and payables are stated with the amount of GST included. $\bullet$

The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the Statement of Financial Position.

Cash flows are included in the Cash Flow Statement on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as operating cash flows.

Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.

YEAR ENDED 30 JUNE 2006

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) $\mathbf{1}$ .

(a) Employee benefits

Provision is made for employee benefits accumulated as a result of employees rendering services up to the reporting date. These benefits include wages and salaries, annual leave, sick leave and long service leave.

Liabilities arising in respect of wages and salaries, annual leave, sick leave and any other employee benefits expected to be settled within twelve months of the reporting date are measured at their nominal amounts based on remuneration rates which are expected to be paid when the liability is settled. All other employee benefit liabilities are measured at the present value of the estimated future cash outflow to be made in respect of services provided by employees up to the reporting date. In determining the present value of future cash outflows, the market vield as at the reporting date on national government bonds, which have terms to maturity approximating the terms of the related liability, are used.

Employee benefit expenses and revenues arising in respect of the following categories:

• wages and salaries, non-monetary benefits, annual leave, long service leave, sick leave and other leave benefits; and
• other types of employee benefits ř

are charged against profits on a net basis in their respective categories.

In respect of the consolidated entity's contributions to superannuation plans, any contributions made to the superannuation funds by entities within the consolidated entity are charged against profits when due.

(r) Earnings per share

Basic EPS is calculated as net profit attributable to members, adjusted to exclude costs of servicing equity (other than dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any bonus element.

Diluted EPS is calculated as net profit attributable to members, adjusted for:

• × costs of servicing equity (other than dividends) and preference share dividends;
• the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as expenses; and
• other non-discretionary changes in revenues or expenses during the period that would result from the dilution of ¥ potential ordinary shares:
• divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element.

(s) Government Grants

Government grants are recognised at fair value where there is reasonable assurance that the grant will be received and all grant conditions will be met.

Grants relating to expense items are recognised as income over the periods necessary to match the grant to the cost they are compensating.

Grants relating to assets are credited to deferred income at fair value and are credited to income over the expected useful life of the asset on a straight-line basis.

YEAR ENDED 30 JUNE 2006

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) $\mathbf{1}$ .

(t) Research and development

Expenditure during the research phase of a project is recognised as an expense when incurred. Development costs are capitalised only when technical feasibility studies identify that the project will deliver future economic benefits and these benefits can be measured reliably.

Development costs have a finite life and are amortised on a systematic basis matched to the future economic benefits over the useful life of the project.

(u) Comparatives

Where necessary, comparatives have been reclassified and repositioned for consistency with current year disclosures.

(v) Rounding of Amounts

The parent entity has applied the relief available to it under ASIC Class Order 98/100 and accordingly, amounts in the financial report and directors' report have been rounded off to the nearest \$1,000.

(w) Critical Accounting Estimates and Judgments

The directors evaluate estimates and judgments incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the group.

The group assesses impairment at each reporting date by evaluating conditions specific to the group that may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Value-inuse calculations performed in assessing recoverable amounts incorporate a number of key estimates.

No impairment has been recognised in respect of goodwill for the year ended 30 June 2006.

2.	FIRST-TIME ADOPTION OF AUSTRALIAN		Adjustments
	EQUIVALENTS TO INTERNATIONAL FINANCIAL		on introduction of	Australian
	REPORTING STANDARDS	Previous GAAP at	Australian equivalents to	equivalents to IFRS at
		1 July 2004	IFRS	1July 2004
	Reconciliation of Equity at 1 July 2004	\$000	\$000	\$000
	ECONOMIC ENTITY
	Assets
	Current Assets
	Cash assets	2,530		2,530
	Receivables	6,060		6,060
	Inventories	750		750
	Deferred tax assets	64		64
	Other	509		509
	Total Current Assets	9,913		9,913
	Non-Current Assets
	Property, plant and equipment	320	(56)	264
	Intangible assets	7,394	2,396	9,790
	Total Non-Current Assets	7,714	2,340	10,054
	Total Assets	17,627	2,340	19,967
	Current Liabilities
	Payables	2,618		2,618
	Current tax liabilities	454		454
	Deferred tax liabilities
	Provisions	88	(88)
	Other	661	88	749
	Total Current Liabilities	3,821	$\overline{\phantom{0}}$	3,821
	Non-Current Liabilities
	Long-term provisions	29		29
	Total Non-Current Liabilities	29		29
	Total Liabilities	3,850		3,850
	Net Assets	13,777	2,340	16,117
	Equity
	Parent entity interest
	Contributed equity ۰	12,075		12,075
	Reserves ň	32		32
	Retained profits ë	1,670	2,340	4,010
	Total parent entity interest in equity	13,777	2,340	16,117
	Total Equity	13,777	2,340	16,117

2.	FIRST-TIME ADOPTION OF AUSTRALIAN EQUIVALENTS TO INTERNATIONAL FINANCIAL REPORTING STANDARDS	Previous GAAP at 1 July 2004	Adjustments on introduction of Australian equivalents to IFRS	Australian equivalents to IFRS at 1 July 2004
	Reconciliation of Equity at 1 July 2004	\$000	\$000	\$000
	PARENT ENTITY
	Assets
	Current Assets
	Cash assets	2,195		2,195
	Receivables	5,414		5,414
	Inventories	141		141
	Deferred tax assets	64		64
	Other	500		500
	Total Current Assets	8,314		8,314
	Non-Current Assets
	Receivables	891		891
	Other financial assets	730		730
	Property, plant and equipment	316	(54)	262
	Intangible assets	6,872	2,287	9,159
	Total Non-Current Assets	8,809	2,233	11,042
	Total Assets	17,123	2,233	19,356
	Current Liabilities
	Payables	2,550		2,550
	Current tax liabilities	343.		343
	Deferred tax liabilities		$\sim$
	Provisions	88	(88)
	Other	526	88	614
	Total Current Liabilities	3,507	$\overline{\phantom{a}}$	3,507
	Non-Current Liabilities
	Long-term provisions	29		29
	Total Non-Current Liabilities	29		29
	Total Liabilities	3,536		3,536
	Net Assets	13,587	2,233	15,820
	Equity
	Parent entity interest
	Contributed equity ۳	12,075		12,075
	Reserves ۳
	Retained profits ۰	1,512	2,233	3,745
	Total parent entity interest in equity	13,587	2,233	15,820
	Total Equity	13,587	2,233	15,820

2.	FIRST-TIME ADOPTION OF AUSTRALIAN EQUIVALENTS TO INTERNATIONAL FINANCIAL REPORTING STANDARDS	Previous GAAP at 30 June 2005	Adjustments on introduction of Australian equivalents to IFRS.	Australian equivalents to IFRS at 30 June 2005
	Reconciliation of Equity at 30 June 2005	\$000	\$000	\$000
	ECONOMIC ENTITY
	Assets
	Current Assets
	Cash assets	2,241		2,241
	Receivables	6,192		6,192
	Inventories	1,581		1,581
	Deferred tax assets	111		111
	Other	417		417
	Total Current Assets	10,542		10,542
	Non-Current Assets
	Property, plant and equipment	350	(112)	238
	Intangible assets	6,913	2,933	9,846
	Total Non-Current Assets	7,263	2,821	10,084
	Total Assets	17,805	2,821	20,626
	Current Liabilities
	Payables	3,102		3,102
	Current tax liabilities	453		453
	Provisions	109	(109)
	Other	420	109	529
	Total Current Liabilities	4,084		4,084
	Non-Current Liabilities
	Long-term provisions	21		21
	Total Non-Current Liabilities	21	$\overline{\phantom{a}}$	21
	Total Liabilities	4,105		4,105
	Net Assets	13,700	2,821	16,521
	Equity
	Parent entity interest
	Contributed equity ă.	12,075		12,075
	Reserves	25		25
	Retained profits	1,600	2,821	4,421
	Total parent entity interest in equity	13,700	2,821	16,521
	Total Equity	13,700	2,821	16,521

2.	FIRST-TIME ADOPTION OF AUSTRALIAN EQUIVALENTS TO INTERNATIONAL FINANCIAL REPORTING STANDARDS	Adjustments on introduction of Previous Australian GAAP at equivalents to 30 June 2005 IFRS		Australian equivalents to IFRS at 30 June 2005
	Reconciliation of Equity at 30 June 2005	\$000	\$000	\$000
	PARENT ENTITY
	Assets
	Current Assets
	Cash assets	1,878		1,878
	Receivables	6,580		6,580
	Inventories	205		205
	Deferred tax assets	111		111
	Other	397		397
	Total Current Assets	9,171		9,171
	Non-Current Assets
	Receivables	488		488
	Other financial assets	730		730
	Property, plant and equipment	347	(110)	237
	Intangible assets	6,423	2,792	9,215
	Total Non-Current Assets	7,988	2,682	10,670
	Total Assets	17,159	2,682	19,841
	Current Liabilities
	Payables	2,759		2,759
	Current tax liabilities	446		446
	Provisions	109	(109)
	Other	343	109	452
	Total Current Liabilities	3,657		3,657
	Non-Current Liabilities
	Long-term provisions	21		21
	Total Non-Current Liabilities	21		21
	Total Liabilities	3,678		3,678
	Net Assets	13,481	2,682	16,163
	Equity
	Parent entity interest
	Contributed equity ۰	12,075		12,075
	Reserves ш
	Retained profits ۳	1,406	2,682	4,088
	Total parent entity interest in equity	13,481	2,682	16,163
	Total Equity	13,481	2,682	16,163

FIRST-TIME ADOPTION OF AUSTRALIAN 2. EQUIVALENTS TO INTERNATIONAL FINANCIAL REPORTING STANDARDS		Effect of transition to Australian equivalents to	Australian equivalents to
	Previous GAAP	IFRS	IFRS
Reconciliation of Profit or Loss for the full year to 30 June 2005 ECONOMIC ENTITY	\$000	\$000	\$000
Revenue	28,993		28,993
Depreciation and amortisation expense	(614)	481	(133)
Salaries and employee benefits expense	(1,759)		(1,759)
Consultants benefits expense	(20, 679)		(20, 679)
Lease expenses	(401)		(401)
Insurance expense	(249)		(249)
Other expenses from ordinary activities	(2,508)		(2,508)
Profit before Income Tax Expense	2,783	481	3,264
Income Tax Expense	(958)		(958)
Profit after Income Tax Expense	1,825	481	2,306
Net Profit Attributable to Members of CPT Global Limited	1,825	481	2,306

FIRST-TIME ADOPTION OF AUSTRALIAN 2. EQUIVALENTS TO INTERNATIONAL FINANCIAL REPORTING STANDARDS		Effect of transition to Australian equivalents to	Australian equivalents to
	Previous GAAP	IFRS	IFRS
Reconciliation of Profit or Loss for the full year to 30 June 2005 PARENT ENTITY	SOO0	\$000	\$000
Revenue	26,562		26,562
Depreciation and amortisation expense	(580)	449	(131)
Salaries and employee benefits expense	(1, 541)		(1, 541)
Consultants benefits expense	(19, 237)		(19, 237)
Lease expenses	(386)		(386)
Insurance expense	(237)		(237)
Other expenses from ordinary activities	(1,850)		(1,850)
Profit before Income Tax Expense	2,731	449	3,180
Income Tax Expense	(939)		(939)
Profit after Income Tax Expense	1,792	449	2,241
Net Profit Attributable to Members of CPT Global Limited	1,792	449	2,241

YEAR ENDED 30 JUNE 2006

FIRST-TIME ADOPTION OF AUSTRALIAN EOUIVALENTS $\mathbf{2}$ TO INTERNATIONAL FINANCIAL REPORTING STANDARDS

Notes to the Reconciliations of Equity and Profit and Loss at 1 July 2004 and 30 June 2005

$(a)$ Under Australian equivalents to IFRS, goodwill is no longer amortised but subject to annual impairment testing. All goodwill amortised under previous GAAP has been reversed. Goodwill amounting to \$2,340,000 (parent entity: \$2,233,000) has been reversed to retained earnings at 1 July 2004. Goodwill amounting to \$481,000 (parent entity: \$449,000) previously amortised in the 2005 full financial year has been reversed in the income statement for the year ended 30 June 2005.

Under Australian equivalents to IFRS, software is classified as an intangible asset as opposed to plant, $(b)$ property and equipment. As such cost and accumulated amortization has been reclassified to intangible assets.

$(c)$ Under Australian equivalents to IFRS, employee annual leave entitlements are classified as accrued expenses as opposed to provisions. As such, employee annual leave entitlements have been re-classified to accrued expenses as at 1 July 2004 and 30 June 2005.

	30 June	1 July
ECONOMIC ENTITY	2005	2004
Retained earnings adjustments comprise:	\$000	\$000
Reversal of goodwill previously amortised	2,821	2,340
Total	2,821	2,340
	30 June	1 July
PARENT ENTITY	2005	2004
Retained earnings adjustments comprise:	\$000	\$000
Reversal of goodwill previously amortised	2,682	2,233
Total	2,682	2,233

YEAR ENDED 30 JUNE 2006

$\mathbf{a}$ REVENILE

з. REVENUE	Economic Entity		Parent Entity
	2006	2005	2006	2005
	\$'000	\$'000	\$'000	\$'000
Revenue from sale of goods	29	153
Revenue from services	30,891	28,556	28,915	26,265
Rental income	24	34	24	34
Interest
Other persons/corporations ٠	61	75	56	72.
Wholly owned controlled entities			52
Total interest	61	75	108	72
Other income	144	175	158	191
Total revenues	31,149	28,993	29,205	26,562
EXPENSES AND LOSSES/(GAINS) 4.	Economic Entity		Parent Entity
	2006	2005	2006	2005
	\$'000	\$'000	\$'000	\$'000
(a) Expenses
Depreciation and amortisation of non-current assets
Plant and equipment, software	121	133	120	131
Total depreciation and amortisation of non-current assets	121	133	120	131
Finance costs	2		5
Bad and doubtful debts - trade receivables	121
Minimum lease payments - operating lease	398	401	389	386
Superannuation contributions	81	122	80	91
(b) Losses/(gains)
Net loss/(gain) on disposal of property, plant and
equipment	(1)	(1)	(1)	(1)
Net foreign currency (gains)/losses	13	61

YEAR ENDED 30 JUNE 2006

5.	INCOME TAX EXPENSE	Notes	Economic Entity		Parent Entity
			2006	2005	2006	2005
	(a) Tax expense comprises:		\$'000	\$'000	\$'000	\$'000
	Current tax		1,129	1,005	975	986
	Deferred tax	17	(34)	(47)	(34)	(47)
	Under (over) provision in respect of prior		38
	year		1,133	958	(14) 927	939
	The prima facie tax on profit before income tax is reconciled to the income tax as follows: Prima facie tax on profit before income tax at 30% (2005: 30%) Tax effect of		955	979	926	954
٠	Tax on overseas income at a different rate		48	(3)
٠	Other non-allowable items		32	16	15	14
٠	Utilisation of prior year tax losses		60	(34)	(14)	(29)
	Under/(over) provision of previous year		38
	Income tax expense attributable to ordinary
	activities		1,133	958	927	939
	The applicable weighted average effective tax rates are as follows:		36%	29%	30%	30%

The increase in the weighted average effective consolidated tax rate for 2006 is a result of increased profits arising in
higher tax jurisdictions and the unavailability of certain current year tax losses for offset agains

DIVIDENDS PAID OR PROVIDED FOR ON $6.$ ORDINARY SHARES

ORDINARY SHARES	Economic Entity		Parent Entity
	2006	2005	2006	2005
(a) Dividends paid during the year	\$'000	\$'000	\$'000	\$'000
Current year interim
Franked dividends (2.75c per share) (2005: $2.50c$ per share)	948	861	948	861
Previous year final
Franked dividends (3.0c per share) (2005:
3.0c per share)	1,034	1.034	1.034	1.034
	1.982	1.895	1.982	1.895

YEAR ENDED 30 JUNE 2006

6.	DIVIDENDS PAID OR PROVIDED FOR ON
ORDINARY SHARES (continued)		Economic Entity		Parent Entity
		2006	2005	2006	2005
		\$'000	\$'000	\$'000	\$'000
liability	(b) Dividends proposed and not recognised as a
٠ $3.00c$ per share)	Franked dividends (3.25c per share) (2005;	1,120	1,034	1,120	1,034
(c) Franking credit balance for franking credits arising from:	Balance of franking account at year end adjusted
Payment of provision for income tax ۰ ۰ proposed dividends	Franking debits arising from payment of			1,933	1,756
Subsequent to year end, the franking account would be reduced by the proposed dividend reflected in Note 6(b) as follows:				(480)	(443)
				1,453	1,313

The tax rate at which paid dividends have been franked is 30% (2005: 30%). Dividends proposed will be franked at the rate of 30% (2005: 30%).

$\overline{7}$ CASH AND CASH EQUIVALENTS

Economic Entity		Parent Entity
2006	2005	2006	2005
\$'000	\$'000	\$'000	\$'000
2.498	2.241	2.036	1.878
	÷	٠
2.498	2.241	2.036	1,878

The effective interest rate on short-term bank deposits held during the year was 5.4% (2005: 5.2%); these deposits had an average maturity of 19 days.

TRADE AND OTHER RECEIVABLES 8.

(CURRENT)	Notes	Economic Entity		Parent Entity
		2006	2005	2006	2005
		\$'000	\$'000	\$'000	\$'000
Trade receivables	8(a)	5,432	6,165	4,712	4,406
Impairment for doubtful receivables		(240)	(108)
		5,192	6.057	4,712	4,406
Other receivables	8(a)	117	135	114	115
Amounts receivable from related parties			$\overline{\phantom{a}}$	1.996	2,059
		5,309	6,192	6,822	6,580

(a) Terms and conditions

(i) Trade receivables are non-interest bearing and generally on 30 day terms.

(ii) Sundry and other receivables are non-interest bearing and have repayment terms between 30 and 90 days.

YEAR ENDED 30 JUNE 2006

9. INVENTORIES (CURRENT)

INVENTORIES (CURRENT) 9.	Economic Entity		Parent Entity
	2006	2005	2006	2005
Work-in-progress	\$'000	\$'000	\$'000	\$'000
At cost and net realisable value	3.094	1,572	639	196
Other inventory
At cost and net realisable value	7	9	7	9
Total inventories at cost and net realisable value	3,101	1,581	646	205.
10. OTHER	Economic Entity		Parent Entity
	2006	2005	2006	2005
	\$'000	\$'000	\$'000	\$'000
Prepayments	126	342	116	333
Other current assets	144	75	96	64
	270	417	212	397

11. TRADE AND OTHER RECEIVABLES NON-CHREENTY

(NON-CURRENT)	Notes	Economic Entity		Parent Entity
		2006	2005	2006	2005
		\$'000	\$'000	\$'000	\$'000
Related party receivables Wholly-owned group
Controlled entities ٠	30		$\overline{\phantom{a}}$	659	488
			٠	659	488

12. OTHER FINANCIAL ASSETS (NON-CURRENT)	Notes	Economic Entity		Parent Entity
		2006	2005	2006	2005
Investments at cost comprise:		\$'000	\$'000	\$'000	\$'000
Shares Controlled entities - unlisted ٠	13	-	$\overline{\phantom{0}}$	730	730

YEAR ENDED 30 JUNE 2006

13. INTERESTS IN SUBSIDIARIES

Name	Country of incorporation	Percentage of equity interest held by the consolidated entity* 2006 2005 % % 100 100 100 100 100 100
CPT Global Ltd	United Kingdom
CPT Global GmbH	Germany
CPT Global Inc.	USA
Deakin Consulting Pty Ltd	Australia	100	100
CPT Global Consulting Pty Ltd	Australia	100	100

* The percentage of voting power is proportional to ownership.

14. PROPERTY, PLANT AND EQUIPMENT	Notes	Economic Entity		Parent Entity
		2006	2005	2006	2005
		\$'000	\$'000	\$'000	\$'000
Office equipment
At cost		654	620	654	620
Accumulated depreciation		(534)	(474)	(534)	(474)
	14(a)	120	146	120	146
Furniture, fixtures and fittings
At cost		184	179	178	172
Accumulated depreciation		(131)	(124)	(124)	(118)
	14(a)	53	55	54	54
Improvements
At cost		91	89	91	89
Accumulated depreciation		(60)	(52)	(60)	(52)
	14(a)	31	37	31	37
Total plant and equipment		204	238	205	237
Total property, plant and equipment
Cost		929	888	923	881
Accumulated depreciation		(725)	(650)	(718)	(644)
Total written down amount		204	238	205	237

YEAR ENDED 30 JUNE 2006

14. PROPERTY, PLANT AND EQUIPMENT

(continued)	Economic Entity	Parent Entity
	2006	2006
(a) Reconciliations Reconciliations of the carrying amounts of property, plant and equipment at the beginning and end of the current financial year.	\$'000	\$'000
Office equipment
Carrying amount at beginning	146	146
Additions	42	42
Disposals	(5)	(5)
Depreciation expense	(63)	(63)
	120	120
Furniture, fixtures and fittings
Carrying amount at beginning	55	54
Additions	5	6
Depreciation expense	(7)	(6)
	53	54
Improvements
Carrying amount at beginning	37	37
Additions	2	$\overline{2}$
Depreciation expense	(8)	(8)
	31	31

YEAR ENDED 30 JUNE 2006

INTANGIBLE ASSETS 15.	Economic Entity		Parent Entity
	2006	2005	2006	2005
	\$'000	\$'000	\$'000	\$'000
Goodwill at cost	9,659	9.659	9.030	9.030
Intellectual Property at cost	75	75	75	75
Software
Cost	208	203	205	200
Accumulated amortisation and impairment	(133)	(91)	(132)	(90)
	75	112	73	110
	9,809	9.846	9.178	9.215

	Goodwill	Intellectual Property	Software
Year ended 30 June 2005	\$'000	\$'000	\$'000
Economic Entity
Balance at the beginning of the year	9,659	75	56
Additions			93
Disposals
Amortisation charge			(37)
	9,659	75	112
Parent Entity
Balance at the beginning of the year	9,030	75	54
Additions			93
Disposals
Amortisation charge			(37)
	9,030	75	110
Year ended 30 June 2006
Economic Entity
Balance at the beginning of the year	9,659	75	112
Additions
Disposals
Amortisation charge			(37)
	9,659	75	75
Parent Entity
Balance at the beginning of the year	9,030	75	110
Additions			5
Disposals
Amortisation charge			(42)
	9,030	75	73

Intangible assets other than goodwill and intellectual property have finite useful lives. The current amortisation charges for intangible assets are included under depreciation and amortisation expense per the income statement. Goodwill and intellectual property have indefinite useful lives.

Goodwill is allocated to cash-generating units, based on the individual companies within the CPT Group.

The recoverable amount of the cash-generating unit is determined based on value-in-use calculations. Value-in-use is calculated based on the present value of the projected cash flows from that cash-generating unit in perpetuity, with the period extending beyond 4 years extrapolated using an estimated growth rate. The cash flows are discounted using the company's weighted average cost of capital.

The following assumptions were used in the value-in-use calculations: growth rate 6%; discount rate 20%. Management has based the value-in-use calculations on budgets and estimates for each group company. These estimates are consistent with past actual outcomes. Discount rates are pre-tax and reflect the risks associated with a particular group company.

Notes to the Financial Statements continued

YEAR ENDED 30 JUNE 2006

16. TRADE AND OTHER PAYABLES (CURRENT)	Economic Entity			Parent Entity
	2006	2005	2006	2005
	\$'000	\$'000	\$'000	\$'000
Trade payables	2,695	2,850	2,441	2,506
Other payables	342	252	340	253
Amounts due to related parties			31
	3,037	3,102	2,812	2,759
17. TAX	Economic Entity		Parent Entity
	2006	2005	2006	2005
(a) Liabilities	\$'000	\$'000	\$'000	\$'000
CURRENT
Income tax	604	453	379	446
(b) Assets
Deferred tax assets comprise:
Provisions	145	111	145	111
(c) Reconciliation of deferred tax assets
Provisions
Opening balance	111	64	111	64
Credited to the income statement	34	47	34	47
Closing balance	145	111	145	111

The future income tax benefit of the deferred tax assets will only be realised if the conditions of deductibility set out in Note 1(c) occur.

18. OTHER CURRENT LIABILITIES	Economic Entity			Parent Entity
	2006	2005	2006	2005
	\$'000	\$'000	\$'000	\$'000
Accrued expenses	451	272	429	222
Deferred revenue	499	150	499	150
Other current liabilities	92	107	123.	80
	1,042	529	1,051	452
19. PROVISIONS (NON-CURRENT)	Economic Entity			Parent Entity
	2006	2005	2006	2005
Long-term employee benefits	\$'000	\$'000	\$'000	\$'000
Balance at 1 July 2005	21	29	21	29.
Additional provisions	25		25
Unused amounts reversed		(8)		(8)
Balance at 30 June 2006	46	21	46	21

A provision has been recognised for employee entitlements relating to long service leave. In calculating the present value of future cash flows in respect of long service leave, the probability of long service leave being taken is based on historical data. The measurement and recognition criteria relating to employee benefits have been included in Note 1.

YEAR ENDED 30 JUNE 2006

20. ISSUED CAPITAL		Economic Entity		Parent Entity
(a) issued and paid up capital	2006	2005	2006	2005
	\$'000	\$'000	\$'000	\$'000
Ordinary shares fully paid	12.075	12.075	12.075	12,075
	12.075	12.075	12.075	12,075

(b) Movements in shares on issue

	2006			2005
	Number of shares	\$'000	Number of shares	\$'000
Beginning of the financial year	34.466	12.075	34,466	12.075
End of the financial year	34,466	12,075	34,466	12.075

$(i)$ Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of shares held. At shareholders' meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands. During the year ended 30th June 2006 no ordinary shares were bought back under the on market buyback.

The on market buyback commenced on the $27^th$ August 2002 with 3,000,000 shares being the maximum to be $(ii)$ bought back of which 2,413,905 were outstanding as at 30 June 2006.

21. RESERVES AND RETAINED PROFITS	Notes	Economic Entity			Parent Entity
		2006	2005	2006	2005
		\$'000	\$'000	\$'000	\$'000
Foreign currency translation	21(a)	40	25
Retained profits	21(b)	4,492	4,421	4,270	4,088
(a) Foreign currency translation
(i) Nature and purpose of reserve
The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign operations.
(ii) Movements in reserve
Balance at beginning of year		25	32
Gain (loss) on translation of overseas controlled
entities		15	(7)
Balance at end of year		40	25
(b) Retained profits
Balance at the beginning of year		4.421	4.010	4.088	3,742
Net profit attributable to members of CPT Global
Limited		2,053	2,306	2,164	2,241
Total available for appropriation		6,474	6,316	6.252	5,983
Dividends provided for or paid		(1,982)	(1, 895)	(1,982)	(1, 895)
Balance at end of year		4,492	4.421	4,270	4.088

Notes to the Financial Statements continued

YEAR ENDED 30 JUNE 2006

22 CASH FLOW STATEMENT

22. CASH FLOW STATEMENT	Economic Entity		Parent Entity
	2006	2005	2006	2005
	\$'000	\$'000	\$'000	\$'000
(a) Reconciliation of the net profit after tax to the net cash flows from operations
Net profit	2,053	2,306	2,164	2,241
Non-Cash Items
Depreciation and amortisation of non-current
assets	121	133	120	131
Net (profit)/loss on disposal of property, plant
and equipment	(1)	(1)	(1)	(1)
Changes in assets and liabilities
(Increase)/decrease in trade and other
receivables	811	39	(277)	(993)
(Increase)/decrease in inventory	(1, 519)	(832)	(440)	(65)
(Increase)/decrease in prepayments	217	(79)	217	(71)
(Decrease)/increase in trade and other creditors	327	241	530	25
(Decrease)/increase in tax provision	151	(1)	(66)	103
(Decrease)/increase in deferred income tax
liability	(34)	(47)	(34)	(47)
(Decrease)/increase in employee entitlements	147	14	147	14
Net cash flow from operating activities	2,273	1,773	2,360	1,337

(b) Disposal of Controlled Entity

There were no acquisitions or disposals in the 2006 financial year.

23. EXPENDITURE COMMITMENTS	Economic Entity		Parent Entity
(a) Lease expenditure commitments	2006	2005	2006	2005
(i) Operating leases (non-cancellable): Minimum lease payments	\$'000	\$'000	\$'000	\$'000
not later than one year ٠ later than one year and not later than five $\bullet$	296	283	296	283
vears Aggregate lease expenditure contracted for at reporting date	117 413	323 606	117 413	323 606
Aggregate expenditure commitments comprise: Aggregate lease expenditure contracted for at reporting date	413	606	413	606

Notes

(b) The property leases are non-cancellable with terms ranging from 1 to 2 years. Rent is payable monthly in advance and the amounts disclosed do not include GST. Contingent rental provisions within the leases require the minimum lease payments to be increased by CPI on the anniversary of the lease agreement. No options exist to renew the leases.

YEAR ENDED 30 JUNE 2006

24. EMPLOYEE BENEFITS AND SUPERANNUATION COMMITMENTS

Employee Benefits	Economic Entity		Parent Entity
	2006	2005	2006	2005
The aggregate employee benefit liability is comprised of:	\$'000	\$'000	\$'000	\$'000
Accrued wages, salaries and on costs	-
Provisions (current)	231	109	231	109
Provisions (non-current)	46	21	46	21
	277	132	277	130

Employee Share Scheme

Information with respect to the number of options granted under the employee share incentive scheme is as follows:

		2006		2005
		Number of options	Weighted average exercise price	Number of options	Weighted average exercise price
Balance at beginning of year	24(a)	550,000	1.00	1,100,000	1.00
Expired		(350,000)	1.00	(550,000)	1.00
Balance at end of year	24(b)	200,000	1.00	550,000	1.00

(a) Options held at the beginning of the reporting period

The following table summarises information about options held by employees as at 1 July 2005;

Number of options	Grant date	Vesting date	Expiry date	Weighted average exercise price
250,000	07/08/00	08/09/01	08/09/05	\$1.00
100.000	26/11/03	26/11/03	27/11/05	\$1.00
100.000	26/11/03	26/11/03	27/11/06	\$1.00
100.000	26/11/03	26/11/03	27/11/07	\$1.00

(b) Options held as at the end of the reporting period

The following table summarises information about options held by employees as at 30 June 2006:

Number of options	Grant date	Vesting date	Expiry date	Weighted average exercise price
100,000	26/11/03	26/11/03	27/11/06	\$1.00
100,000	26/11/03	26/11/03	27/11/07	\$1.00

There are no other options granted by CPT Global Limited to any other party. Options do not confer on the holder any right to vote or participate on the dividends of the economic entity and are not transferable.

25. CONTINGENT LIABILITIES AND CONTINGENT ASSETS

(a) Contingent liabilities

Guarantees

CPT Global Limited has provided guarantees of \$179,888 to third parties in relation to its performance and obligations in respect of property lease rentals and lease finance facilities. The guarantees are for the term of the facilities and leases. The guarantee for lease covers the period one to two years.

YEAR ENDED 30 JUNE 2006

26. EVENTS AFTER THE BALANCE SHEET DATE

(a) On 24th August 2006 CPT Global Limited announced its intention to extend the on-market share buy back for a further twelve months until 27th August 2007. A maximum of 3,000,000 shares may be bought back during the buy back period, which will run from 27th August 2002 until 27th August 2007.

(b) The financial report was authorised for issue on 4 September 2006 by the Board of Directors.

The financial effect of each of the above events has not been recognised.

27. EARNINGS PER SHARE	2006	2005
(a) The following reflects the income and share data used in the calculations of basic and diluted earnings per share:	\$'000	\$'000
Net profit	2.053	2,306
Adjustments:
Earnings used in calculating basic and diluted earnings per share	2.053	2,306
	Number of shares	Number of shares
Weighted average number of ordinary shares
used in calculating basic earnings per share	34,466,364	34,466,364
Adjusted weighted average number of ordinary shares used in calculating diluted earnings per
share	34.466.364	34.466.364

The outstanding options over ordinary shares disclosed in Note 24 are not reflected in diluted earnings per share, as they are anti-dilutive in nature.

28. AUDITORS' REMUNERATION

28. AUDITORS' REMUNERATION	Economic Entity		Parent Entity
	2006	2005	2006	2005
Amounts received or due and receivable by Moore Stephens for:	\$'000	\$'000	\$'000	\$'000
an audit or review of the financial report of ٠ the entity and any other entity in the consolidated entity	99	99	-87	87
other services in relation to the entity and ٠ any other entity in the consolidated entity
- tax compliance	30	27		g
- other services	22	23		4

29. KEY MANAGEMENT PERSONNEL COMPENSATION

(a) Names and positions held of economic and parent entity key management personnel in office at any time during the financial year are:

Key Management Person	Position
Fred S Grimwade	Non-executive Chairman
Gerry Tuddenham	Managing Director
Glenn Fielding	Non-executive Director (resigned 12 th May 2006)
lan MacDonald	Non-executive Director (appointed 7 th April 2006)
Peter Wright	Executive Director
Mark Carroll	Company Secretary, Chief Financial Officer and Chief Operating Officer
Alan Mackenzie	Technical Director CPT Global Ltd (UK)

YEAR ENDED 30 JUNE 2006

29. KEY MANAGEMENT PERSONNEL COMPENSATION (continued)

(b) Compensation Practices

The Remuneration and Nomination Committee of the Board of Directors is responsible for determining and reviewing compensation arrangements for the directors, the managing director and the executive team. The Remuneration and Nomination Committee assesses the appropriateness of the nature and amount of emoluments of such officers on a periodic basis by reference to relevant employment market conditions with the overall objective of ensuring maximum stakeholder benefit from the retention of a high quality Board and executive team. Further details of the Remuneration Policy are included in the directors' report on page 7.

(c) Key Management Personnel Compensation

Details of key management personnel compensation are detailed in the Remuneration Report on page 10.

(d) Compensation Options

Options Granted As Compensation

	Balance at beginning of period	Granted as Remuneration	Options Exercised	Options Lapsed	Balance at end of period
	1 July 2005				30 June 2006
Gerry Tuddenham	250,000	$\overline{\phantom{a}}$		(250,000)
Peter Wright	300,000	$\overline{\phantom{a}}$	$\overline{\phantom{a}}$	(100,000)	200,000
Total	550,000	$\overline{\phantom{a}}$		(350,000)	200,000

(e) Shareholdings

Shares held in CPT Global Limited	Balance 1 July 2005	Granted as Remuneration	On Exercise of Options	Net Change Other	Balance 30 June 2006
	Ord	Ord.	0rd	0rd	Ord
Fred S Grimwade	518,200			200,000	718,200
lan MacDonald				272,511	272,511
Gerry Tuddenham*	12,592,537	$\overline{\phantom{a}}$		(325, 250)	12,267,287
Peter Wright	83,000			81,500	164,500
Specified Executives
Alan Mackenzie	146,623	$\overline{\phantom{a}}$			146,623
Mark Carroll*	89,881	۰		2,000	91,881
Total	13,430,241	۰		230,761	13,661,002

* As a result of shared related parties, included in the shareholdings disclosure of Gerry Tuddenham and Mark Carroll is a common 9,500 ordinary shares.

YEAR ENDED 30 JUNE 2006

29. KEY MANAGEMENT PERSONNEL COMPENSATION (continued)

(f) Other transactions and balances with Key Management Personnel

	Notes	Economic Entity		Parent Entity
		2006 \$'000	2005 \$'000	2006 \$'000	2005 \$'000
Director related entities of Gerard Tuddenham were paid fees during the year for the provision of software licenses (Expetest and Expetune licence agreement dated 20 June 2000 and subsequent variations) on normal commercial
terms and conditions.		38	58	38	41
		38	58	38	41

30. RELATED PARTY DISCLOSURES

Ultimate Parent

The parent entity is ultimately controlled by GNP Nominees Pty Ltd, a director related entity. GNP Nominees Pty Ltd is incorporated in Australia.

31. SEGMENT INFORMATION

PRIMARY SEGMENT

CPT Global Limited operates predominantly in one business segment being the provision of information technology consulting services.

SECONDARY SEGMENT

Geographic segments	Australia		United Kingdom		Germany		United States		Consolidated
	2006 \$'000	2005 \$'000	2006 \$'000	2005 \$'000	2006 \$'000	2005 \$'000	2006 \$'000	2005 \$'000	2006 \$'000	2005 \$'000
Segment revenue	26,390	24,299	1.692	,994	(68)	1,223	3,135	1,477	31.149	28,993
Segment assets	17.877	17,194	1,185	.452	186	1,118	2,088	861	21,333	20,625
Other segment linformation:
Acquisition of property, plant and equipment, intangible assets and other
non-current assets	51	1591							51	159

YEAR ENDED 30 JUNE 2006

32. FINANCIAL INSTRUMENTS

32(a) Financial Risk Management

The group's financial instruments consist mainly of deposits with banks, short-term investments, accounts receivable and payable, and loans to and from subsidiaries.

The main purpose of non-derivative financial instruments is to raise finance for group operations.

Derivatives are used by the group for hedging purposes. Such instruments include forward exchange and currency option contracts and interest rate swap agreements. The group does not speculate in the trading of derivative instruments.

(i) Financial Risks

The main risks the group is exposed to through its financial instruments are interest rate risk, foreign currency risk, liquidity risk and credit risk.

Interest rate risk

The group is exposed to fluctuations in interest rates arising from cash at bank and short-term investments. The group has no debt as at 30 June 2006. Refer to Note 32(b) for further details. All other financial assets and liabilities are not exposed to interest rate risk.

Foreign currency risk

The group is exposed to fluctuations in foreign currencies arising from the sale and purchase of goods and services in currencies other than the group's measurement currency, and the translation of foreign subsidiary results on consolidation. The group may from time to time enter into forward exchange contracts to buy and sell specified amounts of foreign currencies in the future at stipulated exchange rates. The objective in entering the forward exchange contracts is to protect the economic entity against unfavourable exchange rate movements for both the contracted and anticipated future sales and purchases undertaken in foreign currencies. There were no outstanding forward contracts at 30 June 2006.

Liquidity risk

The group manages liquidity risk by monitoring forecast cash flows and ensuring that adequate unutilised borrowing facilities are maintained

Credit risk

The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial assets is the carrying amount of those assets, net of any provisions for doubtful debts, as disclosed in the balance sheet and notes to the financial report. The economic entity does not have any material credit risk exposure to any single debtor or group of debtors under financial instruments entered into by the economic entity.

32(b) Financial Instruments

(i) Interest Rate Risk

The economic entity's exposure to interest rate risk, which is the risk that a financial instrument's value will fluctuate as a result of changes in market interest rates and the effective weighted average interest rates on classes of financial assets and financial liabilities, is as follows:

Financial Instruments	Floating interest rate		rate maturing in 1 year or less	Fixed interest	Non-interest bearing		Total carrying amount as per the statement of financial position		Weighted average effective interest rate
	2006	2005	2006	2005	2006	2005	2006	2005	2006	2005
	%	%	\$'000	\$'000	\$'000	\$'000	\$'000	\$'000	%	%
$(i)$ Financial assets
Cash	5.41	5.21	2,498	2.241			2,498	2,241
Trade and other receivables					5.309	6,192	5,309	6,192
Total financial assets	5.41	5.21	2,498	2,241	5,309	6,192	7,807	8,433

YEAR ENDED 30 JUNE 2006

32. FINANCIAL INSTRUMENTS (continued)

Financial Instruments	Floating interest rate		Fixed interest rate maturing in 1 year or less		Non-interest bearing		Total carrying amount as per the statement of financial position		Weighted average effective interest rate
	2006	2005	2006	2005	2006	2005	2006	2005	2006	2005
	%	%	\$'000	\$'000	\$'000	\$'000	\$'000	\$'000	%	%
$(iii)$ Financial liabilities
Trade creditors					2,695	2,850	2,695	2,850
Other creditors					342	252	342	252
Total financial liabilities					3,037	3,102	3.037	3.102

(ii) Net Fair Values

The following methods and assumptions are used to determine the net fair values of financial assets and liabilities

Recognised financial instruments

Cash, cash equivalents and short-term investments: The carrying amount approximates fair value because of their short-term to maturity.

Trade receivables, trade creditors and dividends receivable: The carrying amount approximates fair value.

Short-term borrowings: The carrying amount approximates fair value because of their short-term to maturity.

Long-term loans receivable: The fair values of long-term loans receivable are estimated using discounted cash flow analysis, based on current incremental lending rates for similar types of lending arrangements.

Long-term bank borrowings and debentures: The fair values of long-term borrowings are estimated using discounted cash flow analysis, based on current incremental borrowing rates for similar types of borrowing arrangements.

Non-current investments/securities: For financial instruments traded in organised financial markets, fair value is the current quoted market bid price for an asset or offer price for a liability, adjusted for transaction costs necessary to realise the asset or settle the liability. For investments where there is no quoted market price, a reasonable estimate of the fair value is determined by reference to the current market value of another instrument which is substantially the same or is calculated based on the expected cash flows or the underlying net asset base of the investment/security. The net fair value of the unlisted options is determined to be the difference between the market price and the exercise price of the underlying shares.

Deferred cash settlement for subsidiary acquired: The carrying value of the deferred cash settlement for the subsidiary acquired approximates its fair value. The fair value is estimated using current commercial borrowing rates for similar types of borrowing arrangements.

Forward exchange contracts: The fair values of forward exchange contracts is determined as the recognised gain or loss at reporting date calculated by reference to current forward exchange rates for contracts with similar maturity profiles.

Unrecognised financial instruments

Interest rate swap agreements: The fair value of interest rate swap contracts is determined as the difference in present value of the future interest cash flows.

Options over ordinary shares: The fair value of options over ordinary shares is determined using the Black-Scholes option pricing model.

Notes to the Financial Statements continued

YEAR ENDED 30 JUNE 2006

33. CHANGE IN ACCOUNTING POLICY

• $\mathbf{a}$ . The group has adopted the following Accounting Standards for application on or after 1 January 2005
• AASB 132: Financial Instruments: Disclosure and Presentation; and $\equiv$
• AASB 139: Financial Instruments: Recognition and Measurement. $\overline{a}$

The adoption of AASB 132 and AASB 139 has had no effect on the financial statements.

$\mathbf{b}$ . The following Australian Accounting Standards have been issued or amended and are applicable to the parent and economic entity but are not yet effective. They have not been adopted in preparation of the financial statements at reporting date.

AASB Amendment	AASB Standard Affected Application Date of the	Standard	Application Date for the Group
$2004 - 3$	AASB 1: First-time Adoption of AIFRS	1 January 2006	1 July 2006
	AASB 101: Presentation of 1 January 2006 Financial Statements		1 July 2006
	AASB 124: Related Party 1 January 2006 Disclosures		1 July 2006
2005-1	AASB 139: Financial Instruments: Recognition and Measurement	1 January 2006	1 July 2006
2005-5	AASB 1: First-time Adoption of AIFRS	1 January 2006	1 July 2006
	AASB 139: Financial Instruments: Recognition and Measurement.	1 January 2006	1 July 2006
2005-6	AASB 3: Business Combinations	1 January 2006	1 July 2006
2005-9	AASB 132: Financial Instruments: Recognition and Measurement	1 January 2006	1 July 2006
	AASB 139: Financial Instruments: Disclosure and Presentation	1 January 2006	1 July 2006
2005-10	AASB 139: Financial Instruments: Recognition and Measurement	1 January 2007	1 July 2007
	AASB 101: Presentation of 1 January 2007 Financial Statements		1 July 2007
	AASB 114: Segment Reporting	1 January 2007	1 July 2007
	AASB 117: Leases	1 January 2007	1 July 2007
	AASB 133: Earnings per share	1 January 2007	1 July 2007

Notes to the Financial Statements continued

YEAR ENDED 30 JUNE 2006

33. CHANGE IN ACCOUNTING POLICY (continued)

	AASB 132: Financial Instruments: Disclosure and Presentation	1 January 2007	1 July 2007
	AASB 1: First-time Adoption of AIFRS	1 January 2007	1 July 2007
2006-1	AASB 121: The Effects of 1 January 2006 Changes in Foreign Exchange Rates		1 July 2006
	New Standard AASB 7: Financial Instruments: Disclosure	1 January 2007	1 July 2007
	New Standard AASB 119: Employee Benefits: December 2004	1 January 2006	1 July 2006

CPT Global is in the process of evaluating the effect of these changes of which the impact can not reasonably be estimated at the date of this financial report, however we do not believe these changes will have a material impact on the annual accounts.

All other pending Standards issued between the previous financial report and the current reporting dates have no application to either the parent or economic entity.

AASB AASB Standard Affected Amendment 2005-2 AASB 1023: General Insurance Contracts 2005-4 AASB 139: Financial Instruments: Recognition and Measurement AASB 132: Financial Instruments: Disclosure and Presentation 2005-9 AASB 4: Insurance Contracts AASB 1023: General Insurance Contracts AASB 139: Financial Instruments: Recognition and Measurement AASB 132: Financial Instruments: Disclosure and Presentation 2005-10 AASB 4: Insurance Contracts AASB 1023: General Insurance Contracts AASB 1038: Life Insurance Contracts

Directors' Declaration

The directors of the company declare that:

• $\mathbf{1}$ . the financial statements and notes, as set out on pages 19 to 55, are in accordance with the Corporations Act 2001 and:
• $\overline{a}$ . comply with Accounting Standards and the Corporations Regulations 2001; and
• give a true and fair view of the financial position as at 30 June 2006 and of the performance for the year b. ended on that date of the company and economic entity;
• $\overline{2}$ the Chief Executive Officer and Chief Finance Officer have each declared that:
• the financial records of the company for the financial year have been properly maintained in accordance a. with section 286 of the Corporations Act 2001;
• the financial statements and notes for the financial year comply with the Accounting Standards; and b.
• the financial statements and notes for the financial year give a true and fair view; c.
• $\overline{3}$ . in the directors' opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

The company and all wholly-owned subsidiaries have entered into a deed of cross guarantee under which the company and its subsidiary guarantee the debts of each other.

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

This declaration is made in accordance with a resolution of the Board of Directors.

d Julial

Gerry Tuddenham Managing Director

Melbourne, 4 September 2006

INDEPENDENT ALIDIT REPORT TO MEMBERS OF CPT GLOBAL LIMITED AND CONTROLLED ENTITIES

Scope

The financial report, remuneration disclosures and directors' responsibility

The financial report comprises the balance sheet, income statement, statement of changes in equity, cash flow statement, accompanying notes to the financial statements, and the directors' declaration for CPT Global Limited and controlled entities, for the year ended 30 June 2006. The consolidated entity comprises both the company and the entities it controlled during that year.

The company has disclosed information about the remuneration of directors and executives ("remuneration disclosures"), as required by Accounting Standard AASB 124 Related Party Disclosures, under the heading "remuneration report" of the directors' report, as permitted by the Corporations Regulations 2001.

The directors of the company are responsible for the preparation and true and fair presentation of the financial report in accordance with the Corporations Act 2001. This includes responsibility for the maintenance of adequate accounting records and internal controls that are designed to prevent and detect fraud and error, and for the accounting policies and accounting estimates inherent in the financial report. The directors are also responsible for the remuneration disclosures contained in the directors' report.

Audit approach

We conducted an independent audit in order to express an opinion to the members of the company. Our audit was conducted in accordance with Australian Auditing Standards, in order to provide reasonable assurance as to whether the financial report is free of material misstatement and the remuneration disclosures comply with Accounting Standard AASB 124 and the Corporations Requlations 2001. The nature of an audit is influenced by factors such as the use of professional judgement, selective testing, the inherent limitations of internal control, and the availability of persuasive rather than conclusive evidence. Therefore, an audit cannot quarantee that all material misstatements have been detected.

We performed procedures to assess whether in all material respects the financial report presents fairly, in accordance with the Corporations Act 2001, including compliance with Accounting Standards and other mandatory financial reporting requirements in Australia, a view which is consistent with our understanding of the company's and the consolidated entity's financial position, and of their performance as represented by the results of their operations and cash flows and whether the remuneration disclosures comply with Accounting Standard AASB 124 and the Corporations Regulations 2001.

We formed our audit opinion on the basis of these procedures, which included:

• examining, on a test basis, information to provide evidence supporting the amounts and disclosures in the financial report and remuneration disclosures, and
• assessing the appropriateness of the accounting policies and disclosures used and the $\bullet$ reasonableness of significant accounting estimates made by the directors.

While we considered the effectiveness of management's internal controls over financial reporting when determining the nature and extent of our procedures, our audit was not designed to provide assurance on internal controls.

Partners racions
Stephen L. Adriaa
Steven A. Allan
Daren I. 3. McDonald
Marco S. Carlei
Jean-Claude Cesario fan K Kearnev

Moore Stephens ABN 39 533 589 331 14th Floor, 607 Bourke Street, Melbourne, Victoria, 3000 Australia Telephone: +61.3.9614.444 Pacsimile: +61.3.9614.6039 Email: melbourne@moorestephens.com.au A member of the Moore Stephens International Limited Group of Independent Firms A separate partnership in Victoria

Kevin W. Neville ece ein een recente
Stephen 3. O 'Flynn Robin C. Pennell S. David Pitr S. Laivie Piu
Grant M. Sincock
Jonathan C. Thomas

Independence

In conducting our audit, we followed applicable independence requirements of Australian professional ethical pronouncements and the Corporations Act 2001.

Audit Opinion

In our opinion:

• the financial report of CPT Global Limited and controlled entities is in accordance with: $\overline{1}$ .
• the Corporations Act 2001, including: $(a)$
  • giving a true and fair view of the company's and consolidated entity's financial $(i)$ position as at 30 June 2006 and of their performance for the year ended on that date: and
  • complying with Accounting Standards in Australia and the Corporations $(ii)$ Regulations 2001; and
• other mandatory financial reporting requirements in Australia; and $(b)$
• $\overline{2}$ . the remuneration disclosures that are contained in the directors' report comply with Accounting Standard AASB 124 and the Corporations Regulations 2001.

Stephens Mare

MOORE STEPHENS Chartered Accountants

二 $\sqrt{ }$

S David Pift Partner Melbourne 4 September 2006

Auditors

Corporate Information

ACN 083 090 895

ABN 16 083 090 895

Directors

Fred Grimwade	(Non-executive Chairman)	Moore Stephens Level 14, 607 Bourke Street Melbourne VIC 3000
(Managing Director)	Gerard (Gerry) Tuddenham	Share Register
Glenn Fielding ian MacDonald	(Non-executive Director - resigned 12/05/06) (Non-executive Director - appointed 07/04/06)	Computershare Investor Services Pty Ltd Yarra Falls, 452 Johnston Street Abbotsford VIC 3067 Telephone: 1300 850 505 Facsimile: +61 (0)3 9473 2500
Peter Wright (Executive Director)		Solicitors
		Gadens Lawyers
Company Secretary		Bankers
Mark Carroll		ANZ Banking Group Limited
	Principal Registered Office
Level 1, 4 Riverside Quay Southbank VIC 3006		ASX Code
	Telephone: +61 (0)3 9690 3911 Facsimile: +61 (0)3 9690 3206 Internet: www.CPTglobal.com	CGO
	2006 Annual General Meeting	CPT Global on the Web
		For an introduction to the company and ac

The Annual General Meeting of CPT Global Limited members will be held on Wednesday the 29th November 2006 at 9.30am at: Level 1, 4 Riverside Quay Southbank VIC 3006

cess to company announcements, descriptions of our core business, services and careers, and our corporate governance policies and procedures visit our website at www.CPTglobal.com

ASX Additional Information

Additional information required by the Australian Stock Exchange Ltd and not shown elsewhere in this report is as follows.
The information is current as at 15^th August 2006.

(a) Distribution of equity securities

The number of shareholders, by size of holding, in each class of share are:

			Ordinary shares			Preference shares
			Number of holders	Number of shares	Number of holders	Number of shares
1	$\sim$	1,000	49	40,675	$\overline{\phantom{a}}$
1,001	۰.	5,000	319	813,820
5,001		10,000	92	737,415
10,001		100,000	187	6,218,671
100,001		and over	41	26,655,783
			688	34,466,364	$\overline{\phantom{a}}$	$\overline{\phantom{a}}$
shares are:		The number of shareholders holding less than a marketable parcel of	12	4,466

(b) Twenty largest shareholders

The names of the twenty largest holders of quoted shares are:

		Listed ordinary shares
		Number of shares	Percentage of ordinary shares
1	GNP NOMINEES PTY LTD	12,092,356	35.08
2	TUDDY SUPER PTY LTD	3,367,817	9.77
3	ANZ NOMINEES LIMITED	1,794,693	5.21
4	MIRRABOOKA INVESTMENTS LIMITED	1,650,000	4.79
5	COGENT NOMINEES PTY LIMITED	1,489,500	4.32
6	GREAT D PTY LTD	500,000	1.45
7	MARIE SCODELLA AND ASSOCIATES	451.212	1.31
8	MR LUKE TUDDENHAM	381,500	1.11
9	MR BEN TUDDENHAM	364,152	1.06
10	CAREY ENTERPRISES PTY LTD	316,000	0.92
11	MR THOMAS MICHAEL SLATTERY	300,000	0.87
12	MR FREDERICK SHEPPARD GRIMWADE	300,000	0.87
13	K & D CONSULTING PTY LTD	264,286	0.77
14	MRS SELINA DALLY	212,320	0.62
15	FAWKNER CAPITAL MANAGEMENT PTY LTD	206,200	0.60
16	MRS BETTINA SCHELLENBERG-HARLEY	204,000	0.59
17	MR STEPHEN LEN MILLAR	200,000	0.58
18	MR MICHAEL LAZORIK	200.000	0.58
19	MR IAN GRAHAM MACDONALD	200,000	0.58
20	MR FRED GRIMWADE	200,000	0.58
		24,694,036	71.65

ASX Additional Information continued

(c) Twenty largest option holders

The names of the twenty largest holders of quoted options are:

	Listed options
	Percentage of Number of total options options
MR PETER WRIGHT	200,000 100.0
	100.0 200,000

(d) Substantial shareholders

The names of substantial shareholders who have notified the Company in accordance with section 671B of the Corporations Act 2001 are:

	Number of Shares
GNP NOMINEES PTY LTD AS TRUSTEE FOR THE CPT TRUST	12.092.356
MR GERARD (GERRY) TUDDENHAM AND HIS ASSSOCIATES (EXCLUDING HIS 68.45% BENEFICIAL INTEREST IN THE CPT TRUST	2.707.150
ANZ NOMINEES LIMITED	1.794.693

(e) Voting rights

All ordinary shares (whether fully paid or not) carry one vote per share without restriction. Options do not carry voting rights.

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CPT GLOBAL LIMITED

Level 1, 4 Riverside Quay Southbank Vic 3006 Telephone: +61 (0)3 9690 3911 +61 (0)3 9690 3206 Facsimile: Internet: www.CPTglobal.com