DTI GROUP LTD — Annual Report 2014

Dec 4, 2014

Annual Report 2013

D T I G R O U P L I M I T E D

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A B N 1 5 0 6 9 7 9 1 0 9 1

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Table of Contents

Corporate Directory....................................................... …2	Corporate Directory....................................................... …2
1	Directors’ Report.................................................... 3
2	Consolidated Statement of Profit or Loss and Other
	Comprehensive Income..........................................10
3	Consolidated Statement of Financial Position...............11
4	Consolidated Statement of Changes in Equity .................12
5	Consolidated Statement of Cash Flows...........................13
6	Notes to the Financial Statements.............................14
7	Directors’ Declaration.............................................37
8	Auditor’s Report....................................................38
9	Auditor’s Independence Declaration...........................40

Corporate Directory

Directors

Chris Morris Non-Executive Chairman Richard Johnson Managing Director Neil Goodey Non-Executive Director Glyn Denison Non-Executive Director Jeremy King Non-Executive Director

Company Secretary

Bruce Mitchell

Corporate Advisor

Pendulum Capital Pty Limited Level 2, 24 Outram Street West Perth WA 6005 Telephone: 08 9282 5400

Solicitors

Hewett & Lovitt Level 1, 849 Wellington Street West Perth WA 6005

Registered and Principal Office

50 Affleck Road Perth Airport WA 6105 Telephone: 08 9479 1195 Facsimile: 08 9479 1190 Website: www.dti.com.au

Auditors

BDO Audit (WA) Pty Ltd 38 Station Street Subiaco WA 6008 Telephone: 08 6382 4600

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Directors’ report

The Directors present their report for DTI Group Limited (“DTI” or “the Company”) together with the financial report of the Company for the year ended 30 June 2013 and the auditor’s report thereon.

Directors

The names and details of the Company’s Directors in office during the financial year and until the date of this report are set out below. Directors were in office for this entire period unless otherwise stated.

Chris Morris

Non-Executive Chairman Date of appointment – 29 June 2011

Chris attended his first computer course in Melbourne in 1966 after completing high school. Following this, he worked for various computer companies mainly associated with maintaining companies share registries until 1978 when he became a founding member of Computershare Limited (established in 1978) and was appointed Chief Executive Officer in 1990. Chris’ extensive knowledge of the securities industry and its user requirements from both a national and international perspective, coupled with his passion and long term strategic vision, has been instrumental in developing Computershare into a global company that is unique in its provision of a full range of solutions to meet the needs of listed companies and their stakeholders.

In September 2010 he relinquished his executive responsibilities at Computershare Limited and took on the role of Non-Executive Chairman. Since then he has joined the board of Web Firm and is Chairman of Car Parking Technologies. He is also on the board of a number of private technology companies and owns a hotel group called the Colonial Leisure Group which has 15 hotels in Perth and Melbourne.

Richard Johnson

Managing Director Date of appointment – 9 August 2011

Richard is a qualified engineer and has over 19 years experience in the transit technology sector. In 2005, Richard joined DTI as General Manager and commenced the role as Chief Executive Officer in October 2006. In August 2011, Richard joined the Board as Managing Director. Prior to joining DTI, he held senior management positions within ERG Limited which developed, supplied, and managed integrated fare collection systems for the transit industry around the world. Richard’s qualifications include a B.Sc (Eng), M.Eng.St., and an MBA.

Neil Goodey

Non-Executive Director Date of appointment – 8 June 1995

Neil has over 20 years management and directorship experience in technology and mining service companies. Neil was co-founder of DTI Group as well as a number of other successful companies including UTS Geophysics. Neil is Managing Director and cofounder of Corescan Pty Ltd.

Glyn Denison

Non-Executive Director Date of appointment – 19 January 2004

Glyn has over 20 years experience in the transit technology sector and was a co-founder of ERG Limited. Glyn is a Director of OBJ Ltd. and consults with the business consulting firm of Evans & Peck Ltd. Glyn’s qualifications include a B.Eng., Grad.Dip.B.A., and MIEAust.

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Jeremy King

Non-Executive Director Date of appointment – 29 June 2011

Jeremy is a corporate lawyer with over 14 years experience in domestic and international law, as well as in financial and corporate matters. He spent several years in London where he worked with Allen & Overy LLP and Debevoise & Plimpton LLP. He has extensive corporate experience, particularly in relation to cross-border private equity, leveraged buy-out acquisitions and acting for banks, financial institutions and corporate issuers in respect of various debt and equity capital raisings. As a corporate advisor with Max Capital Pty Limited, he regularly advises a wide range of listed public and private companies in respect to capital raisings, investments, acquisitions and corporate issues.

Company Secretary

Bruce Mitchell

Date of appointment – 27 May 2012

Bruce has been a qualified Chartered Accountant for almost 20 years and has over 16 years experience in senior financial roles. He joined DTI in 2012 as CFO and is responsible for the management and administration of all aspects relating to both internal and external financial accounting and reporting. Prior to DTI Bruce gained experience working as a Financial Director for several South Africa based companies. He has worked across varied industries including IT and manufacturing.

Principal activities

DTI Group Limited designs, develops, sells, and manages integrated video surveillance and vehicle tracking technology specially developed for use in the public transport and mobile sectors including bus, rail, taxi, freight and law enforcement operations.

DTI’s integrated solution incorporates proprietary hardware and software technology which enables high quality digital video, audio and vehicle location information to be captured, stored, retrieved and reviewed across a fleet of transit vehicles.

Review of operations

Australian Operations

DTI maintained its strong market position in the Australian transit sector during the 2013 financial year with over $9 million under contracts awarded in previous financial years and through additional orders. These sales are marginally up on the previous financial year but with an increased diversity of sales which covered 49 different customers in Perth, Adelaide, Canberra, Tasmania, Melbourne, Sydney and Brisbane.

The Company has a current install base of almost 5,000 CCTV systems in public transport organisations in Australia including a substantial installation base in five of Australia’s eight capital cities with an ongoing business development campaign in Melbourne and Sydney showing results with new customers purchasing systems along with new bus procurements.

As mentioned in last years’ annual report, DTI signed a contract with Bombardier Transportation (“Bombardier”) in September 2011 for the provision of advanced surveillance equipment covering three rail projects in Australia. The equipment is tested and qualified and has now been fitted on a number of trains which are currently being commissioned for traffic use by Bombardier and the end customer. Bombardier is one of the world's largest companies in the passenger rail industry and the selection of DTI equipment for these initial projects is viewed as an ideal opportunity to progress with further projects globally with Bombardier.

In September 2012, DTI signed a multi-million dollar contract with the Brisbane City Council (BCC) for the supply, installation, and maintenance of advanced video surveillance systems into 307 existing buses and 90 new buses per year for three years as well as the installation of depot infrastructure of up to a further 6 depots. The award includes a standing offer arrangement for the inclusion of further contracts if requested by the BCC and demonstrated further confidence with our installation base. Currently, 250 of the 307 buses have been installed with ongoing installation of 90 new buses per year progressing as scheduled by the bus manufacturer.

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In April 2013, DTI completed the installation on 143 Queensland Rail (“QR”) trains in what was DTI’s largest installation contract to date. The DRU2 and corresponding system solution now provides an enhanced offering to future customers backed by a world-class reference site and a supportive customer. Also in the local passenger rail market, DTI received an initial order from Metro Trains Melbourne for a forward-facing camera and GPS demo system in June 2013. While small, we are hopeful that the demo system will lead to further orders from this very large prospective customer.

DTI continued to expand into other mobile market segments with a multi-million dollar contract signed in October 2013 for the provision of video surveillance systems with Ansaldo STS Australia Pty Ltd for remote monitoring of driverless trains and level crossings on rail lines which are operated by Rio Tinto in the Northwest of Western Australia. The Autohaul Driverless Train project will provide systems to remotely operate Rio Tinto trains 1,500 kilometres from the Rio Tinto control centre in Perth. The DTI scope for the project includes the provision of remote video surveillance monitoring systems on locomotives to ensure the safe movement of the driverless trains. The project also includes the supply of systems to enable remote monitoring of over 40 level crossings on the rail network.

Also in the high value freight sector, a contract was signed with Aurizon in October 2013 for the development of a reversing camera solution for coal trains in Queensland. The solution will provide to the train driver a real-time view of the end of the coal train which can be over 2 kilometres in length. If the solution is successful, up to 76 locomotives will have the system installed.

DTI has further expanded its public transport offering through the service bureau concept. The service bureau provides for continuous and steady revenue streams through a broad range of outsourced services and DTI remains fairly unique in this offering in the marketplace. Revenue from services increased 7% this financial year to $1.80 million with the provision of these services to customers in Perth, Adelaide, Brisbane, Tasmania as well as in the UK for the Eversholt Rail project.

The market for mobile surveillance equipment in Australia continues to remain strong with DTI signing new contracts early in the 2013-2014 financial year combined with the pursuit of further prospects in a range of market segments.

International Operations

DTI experienced very strong growth in international operations during the 2013 financial year through ongoing relationships with key partners and the development of new customers.

In the US, DTI’s key strategic alliance partner, a large and well known global company, provided ongoing market access to the largest customers of transit surveillance systems in the US. In December 2010, DTI announced the approval by a key US city to equip 426 buses with digital surveillance systems with further options for 1,100 units which were exercised in March 2012 and deliveries continued throughout the 2012-2013 financial year. With the ongoing success of the project which is being reinforced by increasing demand from key stakeholders such as the driver’s union, further expansion of the project is expected to continue in the 2013-2014 financial year.

The initial three year strategic alliance with the key US partner which was renewed in September 2009 to include the design and manufacture of the MobileView Penta, was recently renewed in September 2013 to extend the alliance until December 2017 with a further five year option. The product has been well received with almost 8,000 units being sold to date coupled with a strong forecast for the 2014 financial year.

In addition to the strategic alliance, DTI signed a separate multi-million dollar contract for the San Francisco Municipal Transportation Agency with Kratos Public Safety & Security Solutions, Inc in December 2012 for the supply, installation support, and integration of advanced video surveillance systems for 357 existing buses. A successful pilot was completed in February 2013 and the 357 installations have now been completed for the base contract with additional options for new buses also being completed. A further multi-million dollar order was received from Kratos in September 2013 for a further 551 systems for bus and light rail vehicles in San Francisco. This on-going support gives DTI a strong foothold on the west coast in conjunction with the east coast of the United States.

In Europe, DTI Group received an order in September 2011 for the supply, installation and long-term support of 326 video surveillance systems from Eversholt Rail (UK) Limited (formerly HSBC Rail (UK) Limited), part of the Eversholt Rail Group (“Eversholt”). Eversholt is the largest of the UK’s leading rolling stock groups and owns 4,000 passenger rail cars. The system was fully operational ahead of the London 2012 Olympic Games.

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The two commuter fleets, Class 315 and Class 321, both operate in the East Anglia area of the UK. The contract includes a longterm service bureau agreement which provides system support for up to 14 years. The system has been well received with Eversholt nominating us for an award at the UK Rail Business Awards in February 2013 for which DTI was a finalist.

In September 2013, DTI received a letter of intent from National Express West Midlands (NEWM) in Birmingham for the provision of 234 systems for their buses. In addition, DTI has received a further order for 26 systems from the bus builder Alexander Denis who are building new buses for NEWM. These orders represent a significant endorsement of the DTI solution in the UK bus market.

DTI was successful in expanding its international operations into South Africa with an order in October 2013 for 45 surveillance systems for Cape Town buses on top of the 268 systems already delivered in the previous financial year. The systems include DTI's latest ‘hybrid’ Digital Recording Unit (MDR5-L) with up to 8 high resolution megapixel IP and analogue cameras and driver's display monitor. In June 2013, an order for 40 systems was announced by DTI for the Metro Police Division in Cape Town. This order is the first international sale in the law enforcement market and is being promoted to other cities and markets.

DTI is also targeting a range of further system orders from the European and United States markets and we have recently established a sales presence in France and Sweden. DTI has exhibited in a range of international trade shows over the past year including Innotrans in Berlin, Trako and Transexpo in Poland, Railtex in London, and ATEC in Paris.

Technology Development Activities

Key developments include:

The development of the MDR5L product, which was released to the market in July 2011, was further enhanced in 2012 with the introduction of the MDR5M. The MDR5M is a dual-drive enhancement of the cost-effective MDR5L which also includes the integration of technologies into the product such as dual frequency wireless networking, 3G communications, lower power components, a smaller footprint, and 16 full-frame rate camera channels. The MDR5M has been sold extensively into San Francisco where each bus utilises two cameras for transit only lane enforcement (TOLE) and these cameras are recorded to a separate specialised solid state drive, which can be reviewed to provide infringement evidence for vehicles illegally utilising transit only lanes. Through this TOLE infringement capability, it is envisaged there will be a reduction in transit delays through a reduction in the illegal use of bus lanes.

As part of DTI’s comprehensive rail product suite, development has commenced on a pantograph and overhead wire infrastructure inspection solution which uses machine vision and video analytics. These systems will be incorporated in the DTI central maintenance suite to provide rail maintenance staff with easy to reference pantograph infrastructure condition with alerts to potential threats and loss of service on the rail line.

DTI has also commenced initial trials in the UK on automated passenger counting using video analytics. The video based passenger counting module is a cost effective way to count and monitor passenger numbers on rail or bus fleets. Using discreet overhead cameras above doorways, this technology uses a virtual trip-wire zone for detection of human forms. Every time passengers cross a line or enter a designated area in either direction, the software registers a count (in/out) and updates the database. This information is processed and stored on-board a database partition within the DTI recorder.

The development of a Real Time Streaming Protocol (RTSP) was commenced in late 2012 to cater for the provision of live images of moving vehicles over bandwidth restricted networks such as 3G. The protocol is used for establishing and controlling video sessions between remote end points and has been successfully demonstrated in one of the largest cities in the US which has generated interest in a city wide implementation across 1,500 buses.

The development of DTI's latest rail Digital Recording Unit (DRU–3) was commenced in December 2011 following the contract award with Bombardier and is now commencing revenue service. The DRU-3 is able to manage up to 32 high resolution megapixel IP cameras with redundant direct streaming capability. The DRU–3 is fully integrated into the Bombardier IPTCom (IP Train Communications) network and architecture via DTI supplied network switches and a software communications interface.

Virtual Observer (“VO”) continues to be a most impressive technology which incorporates spatial-temporal data structures to allow footage from forward view cameras across a number of vehicles to be stitched together across time from a virtual location chosen by the surveillance operator. In June 2012, DTI increased its ownership from 49.5% to 100%. In October 2013, DTI exhibited VO at the annual defence exhibition in Washington DC.

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Financial Costs and Overheads

Total income was higher for the period showing a 25% increase over the previous year. Administrative and operational costs were lower during the period, primarily resulting from increased efficiency and scalability in existing contracts.

The outlook remains strong and DTI entered FY 2014 with a strong order book bolstered by significant contracts and orders received in the first quarter of FY 2014.

Results and dividends

The result of the consolidated group for the financial year ended 30 June 2013 was a $1,625,184 profit (2012: $302,730 loss) after a $14,756 share of Virtual Observer’s loss for the year (2012: $29,725 profit), a $93,624 share of DTI EMEA’s loss for the year (2012: $75,122 loss) and a realised foreign exchange gain of $104,960 (2012: $186,587 gain). No dividends have been paid or declared since the end of the previous financial year (2012: nil) and the Directors do not recommend any dividend be paid.

Significant changes in the state of affairs

No significant changes occurred during the financial year:

Subsequent events

Other than any matters described in Note 23 to these financial statements, there has not arisen in the interval between the end of the year and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors to affect significantly the operations of the Company, the results of those operations, or the state of affairs of the Company in future financial years.

Likely developments

Likely developments in the operations of the Company 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 Company.

Environmental regulation

The Company is not subject to any environmental regulation.

The Directors have considered compliance with the National Greenhouse and Energy Reporting Act 2007 which requires entities to report greenhouse gas emissions and energy use. The Directors have assessed that there are no current reporting requirements, but the Company may be required to do so in the future.

Options

At the end of June 2013, unissued ordinary shares of the Company under option are:

Date Options Granted	Expiry Date	Exercise Price	Number of Options
30 June 2011	30 June 2015	$2.25	1,767,258

There were no other options issued to Directors or key management personnel during the year.

Further information in respect of these options is set out in Note 20 to the financial statements.

Directors’ meetings

The number of Directors’ meetings and number of meetings attended by each of the Directors of the Company during the financial year are as follows:

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Director	Attended	Eligible
Neil Goodey	4	4
Glyn Denison	4	4
Chris Morris	3	4
Richard Johnson	4	4
Jeremy King	3	4

Auditor independence

In relation to the audit of the financial report for the year ended 30 June 2013, the Auditors have issued the Directors with an independence declaration. Refer to page 40 for the specific declaration.

Non-audit services

The Board of Directors 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 Board of Directors prior to commencement to ensure they do not conversely affect the integrity and objectivity of the auditor; and

• The nature of the services provided does not compromise the general principles relating to auditor independence as set out in the APES Code of Ethics for Professional Accountants.

The total fees for non-audit services paid to the auditor or related practices of the auditor during the year ended 30 June 2013 were $nil (2012: nil).

Proceedings on behalf of the company

No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the company, or to 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 part of those proceedings.

No proceedings have been brought or intervened in on behalf of the company with leave of the Court under section 237 of the Corporations Act 2001.

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Indemnification of Officers and Auditors

During the financial year, the Company paid a premium in respect of a contract insuring the Directors of the Company (as named above) and all executive officers of the Company against a liability incurred as such Director, secretary or executive officer to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.

The Company has not otherwise, during or since the financial year, indemnified or agreed to indemnify an officer or auditor of the Company or of any related body corporate against a liability incurred as such an officer or auditor.

Signed in accordance with a resolution of the Directors made pursuant to s298(2) of the Corporations Act 2001 .

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Richard Johnson Director 31 October 2013, Perth, Australia

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Financial statements

Consolidated Statement of Profit or Loss and Other Comprehensive Income for the year ended 30 June 2013

for the year ended 30 June 2013
Note	2013 $ 2012 $
Revenue from continuing operations 3(a) Other income 3(b) Change in inventory of finished goods 3(c) Raw materials and consumables used 3(c) Employee benefits expense Depreciation and amortisation expense Administration expenses Marketing expenses Research and development expenses Other expenses Share of profit / (loss) of associate 13 Finance costs 3(d) Profit /(loss) from operations before income tax Income tax (expense) / benefit 4 Profit /(loss) after tax Profit/(loss) is attributable to: Owners of DTI Group Limited Other comprehensive income Total comprehensive income /(loss) for the year Total comprehensive income / (loss) is attributable to: Owners of DTI Group Limited	19,496,642 15,282,456 1,085,479 1,169,463 222,426 (294,306) (11,116,111) (8,973,693) (4,284,361) (4,188,066) (948,285) (644,556) (1,064,811) (1,432,703) (730,150) (802,211) (43,212) (95,355) (473,190) (529,992) - 29,725 (49,366) (23,369)
	2,095,061 (502,607) (469,877) 199,877
	1,625,184 (302,730)
	1,625,184 (302,730) - -
	1,625,184 (302,730)
	1,625,184 (302,730)

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

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Consolidated Statement of Financial Position

as at 30 June 2013

as at 30 June 2013
Note	2013 $ 2012 $ 1 July 2011 $
Current assets Cash and cash equivalents 24(a) Other financial assets 7 Trade and other receivables 8 Inventories 9 Other current assets 10 Total current assets Non-current assets Plant and equipment 11 Intangible assets 12 Other receivables 8 Other financial assets 13 Total non-current assets Total assets Current liabilities Trade and other payables 14 Borrowings 15 Provisions 17 Total current liabilities Non-current liabilities Borrowings 16 Provisions 17 Total non-current liabilities Total liabilities Net assets Equity Contributed equity 18 Reserves 19(a) Accumulated losses 19(b) Total equity	1,170,440 812,214 3,467,175 400,063 371,680 371,680 4,469,347 4,470,936 3,352,676 2,113,713 2,068,073 1,367,136 85,255 98,206 92,920
	8,238,818 7,821,109 8,651,587
	631,862 374,076 302,812 2,859,628 2,433,209 1,840,204 162,210 565,304 441,479 235,123 705,087 505,000
	3,888,823 4,077,676 3,089,495
	12,127,641 11,898,785 11,741,082
	2,904,977 4,237,523 2,782,104 5,323 79,216 1,504,204 97,315 72,394 -
	3,007,615 4,389,133 4,286,308
	31,346 - 26,173 46,371 133,115 34,230
	77,717 133,115 60,403
	3,085,332 4,522,248 4,346,711
	9,042,309 7,376,537 7,394,371
	9,239,384 9,202,481 8,952,481 1,156,957 1,153,272 1,118,376 (1,354,032) (2,979,216) (2,676,486)
	9,042,309 7,376,537 7,394,371

The above consolidated statement of financial position should be read in conjunction with the accompanying notes.

*See note 27 for details regarding the restatement as a result of an error

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Consolidated Statement of Changes in Equity

for the year ended 30 June 2013

for the year ended 30 June 2013
	Contributed Equity Options Reserve Accumulated Gains / (Losses) Total $ $ $ $
At 30 June 2011 Net income recognised directly in equity Profit for the year as reported in the 2012 financial statements Adjustment on error (net of tax) Restated profit for the year Transactions with owners in their capacity as owners Issue of share capital Share based payments At 30 June 2012 Net income recognised directly in equity Total comprehensive income for the year Transactions with owners in their capacity as owners Issue of share capital Share based payments At 30 June 2013	8,952,481 1,118,376 (2,676,486) 7,394,371 - - (227,115) (227,115) (75,615) (75,615) (302,730) (302,730)
	250,000 - - 250,000 - 34,896 - 34,896
	9,202,481 1,153,272 (2,979,216) 7,376,537
	- - 1,625,184 1,625,184 36,903 - - 36,903 - 3,685 - 3,685
	9,239,384 1,156,957 (1,354,032) 9,042,309

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

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Consolidated Statement of Cash Flows

for the year ended 30 June 2013

Consolidated Statement of Cash Flows for the year ended 30 June 2013
Note	2013 $ 2012 $
Cash flows from operating activities Receipts from customers Payments to suppliers and employees Interest received Research and development grant received Interest paid Net cash inflow / (outflow) from operating activities 24(b) Cash flows from investing activities Payments for plant and equipment Payments for intangible assets Payment of term deposit Net cash outflow from investing activities Cash flows from financing activities Proceeds from issues of shares Repayment of borrowings Net cash outflow from financing activities Net increase / (decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year 24(a)	20,100,964 15,106,748 (18,912,694) (15,259,942) 16,359 31,985 869,483 - (49,366) (23,369)
	2,024,746 (144,578)
	(420,366) (184,672) (1,212,125) (1,124,552) (28,383) -
	(1,660,874) (1,309,224)
	36,903 250,000 (42,548) (1,451,161)
	(5,645) (1,201,161)
	358,227 (2,654,962) 812,213 3,467,175
	1,170,440 812,213

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

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Notes to the financial statements

Note 1: Summary of significant accounting policies

Statement of compliance

The financial report is a general purpose financial report which has been prepared in accordance with the Corporations Act 2001, Accounting Standards and Australian Accounting Interpretations, and complies with other requirements of the law. The Company’s financial statements and accompanying notes of the Company comply with International Financial Reporting Standards (‘IFRS’). DTI Group Limited is a for profit entity for the purpose of preparing the financial statements.

The financial statements were authorised as per the Directors’ declaration on page 37 dated 15 November 2012.

Basis of preparation

The financial report has been prepared on the basis of historical cost. Cost is based on the fair values of the consideration given in exchange for assets.

In the application of IFRS management is required to make judgments, estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstance, the results of which form the basis of making the judgments. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Judgments made by management in the application of IFRS that have significant effects on the financial statements and estimates with a significant risk of material adjustments in the next year are disclosed in note 1(u) are, where applicable, in the relevant notes to the financial statements.

The company has applied the revised AASB 101 Presentation of Financial Statements which became effective on 1 January 2009. The revised standard requires the separate presentation of a statement of comprehensive income and a statement of changes in equity. All non-owner changes in equity must now be presented in the consolidated statement of profit or loss and other comprehensive income.

Investment in associates

Associates are all entities over which the Company has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for in the Company financial statements using the equity method of accounting, after initially being recognised at cost.

The Company’s share of its associates’ post-acquisition profits or losses is recognised in the statement of profit and loss, and its share of post-acquisition movements in reserves is recognised in reserves. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. Dividends receivable from associates are recognised in the Company’s statement of financial position by reducing the carrying amount of the investment.

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

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

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Accounting policies

Accounting policies are selected and applied in a manner which ensures that the resulting financial information satisfies the concepts of relevance and reliability, thereby ensuring that the substance of the underlying transactions or other events is reported.

The accounting policies set out below have been applied in preparing the financial statements for the year ended 30 June 2013, the comparative information presented in these financial statements for the year ended 30 June 2012.

The following significant accounting policies have been adopted in the preparation and presentation of the financial report:

(a) Accounts payable

Trade payables and other accounts payable are recognised when the Company becomes obliged to make future payments resulting from the purchase of goods and services. The amounts are unsecured and are usually paid within 60 to 90 days of recognition.

(b) Property, plant and equipment

Plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Depreciation is provided on property, plant and equipment. Depreciation is calculated on either a diminishing value or straight line basis so as to allocate the net cost or other re-valued amount of each asset over its estimated useful life or in the case of certain leased plant and equipment the shorter lease term.

The following estimated useful lives are used in the calculation of depreciation:

• Plant and equipment: 2.5 – 5 years

• Motor vehicles under finance lease: 5 years

(c) Provisions

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

(d) Impairment of assets

At each reporting date, the entity reviews the carrying amounts of its assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are independent from other assets, the entity estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised in profit or loss immediately, unless the relevant asset is carried at fair value, in which case the impairment loss is treated as a revaluation decrease.

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Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cashgenerating unit) in prior years. A reversal of an impairment loss is recognised in profit or loss immediately, unless the relevant asset is carried at fair value, in which case the reversal of the impairment loss is treated as a revaluation increase.

(e)

Employee benefits

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

Provisions made in respect of wages and salaries, annual leave, long service leave and sick leave expected to be settled within 12 months are measured at their nominal values using the remuneration rate expected to apply at the time of settlement.

Share-based compensation benefits are provided to employees via the DTI Employee Option Plan. Information regarding to this is set out in note 20.

The fair value of options granted under the DTI Option Plan is recognised as an employee benefit expense with a corresponding increase in equity. The fair value is measured at grant date and recognised over the period during which employees become unconditionally entitled to the options. Where the options have vested but are not taken up and are forfeited, the previously recognised expense is not reversed.

The fair value at grant date is independently determined using a Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected volatility of the underlying share, and the risk free interest rate for the term of the option.

The fair value of the options granted is adjusted to reflect market vesting conditions, but excludes the impact of any nonmarket vesting conditions (for example, profitability and sales growth targets). Non-market vesting conditions are included in assumptions about the number of options that are expected to become exercisable. At each reporting date, the Company revises its estimate of the number of options that are expected to become exercisable. The employee benefit expense recognised each period takes into account the most recent estimate. The impact to the original estimates, if any, is recognised in the consolidated statement of profit or loss and other comprehensive income with a corresponding adjustment to equity.

(f) Investment and other financial assets

The Company classifies its financial assets as loans and receivables. The classification depends on the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition.

Loans and receivable

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for those with maturities greater than 12 months after the reporting date which are classified as non-current assets.

Loans and receivables are included in trade and other receivables (note 8) in the statement of financial position. Financial assets are derecognised when the rights to receive the cash flows from the financial assets have expired or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.

Loans and receivables are carried at amortised cost using the effective interest method.

The Company assesses at each reporting date whether there is objective evidence that a financial asset or group of financial assets is impaired.

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(g) Financial instruments issued by the company

Debt and equity instruments are classified as either liabilities or as equity in accordance with the substance of the contractual arrangement.

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

(h) Borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transactions costs) and the redemption amount is recognised in the consolidated statement of profit or loss and other comprehensive income over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities, which are not an incremental cost relating to the actual draw-down of the facility, are recognised as prepayments and amortised on a straight-line basis over the term of the facility.

(i) Foreign currency

Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the consolidated statement of profit or loss and other comprehensive income, except when they are deferred in equity as qualifying cash flow hedges and qualifying net investment hedges or are attributable to part of the net investment in a foreign operation.

Translation differences on non-monetary financial assets and liabilities are reported as part of the fair value gain or loss. Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss.

All foreign currency transactions during the financial year are brought to account using the exchange rate in effect at the date of the transaction. Foreign currency monetary items at reporting date are translated at the exchange rate existing at that date.

(j) Goods and services tax

Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except:

• i. where the amount of GST incurred is not recoverable from the taxation authority, it is recognised as part of the cost of acquisition of the asset or as part of the item of expense; or

• ii. for receivables and payables which are recognised inclusive of GST.

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

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

(k) Government grants

Government grants are assistance by the government in the form of transfers of resources to the Company in return for past or future compliance with certain conditions relating to the operating activities of the entity. Government grants include government assistance where there are no conditions specifically relating to the operating activities of the Company other than the requirement to operate in certain regions or industry sectors.

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Government grants relating to income are recognised as income over the periods necessary to match them with the related costs. Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Company with no future related costs are recognised as income of the period in which it becomes receivable.

Government grants relating to assets are treated as deferred income and recognised in profit and loss over the expected useful lives of the assets concerned.

(l) Inventories

Inventories are valued at the lower of cost and net realisable value. Costs are assigned to inventory on hand by the method most appropriate to each particular class of inventory, with the majority being valued on a first in first out basis.

(m) Leased assets

Leased assets classified as finance leases are recognised as assets. The amount initially brought to account is the present value of minimum lease payments. Finance leased assets are amortised on a diminishing value basis over the estimated useful life of the asset.

Finance lease payments are allocated between interest expense and reduction of lease liability over the term of the lease. The interest expense is determined by applying the interest rate implicit in the lease to the outstanding lease liability at the beginning of each lease payment period.

Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Company as lessee are classified as operating leases (note 21). Payments made under operating leases (net of any incentives received from the lessor) are charged to the consolidated statement of profit or loss and other comprehensive income on a straight-line basis over the period of the lease.

(n) Receivables

Trade receivables and other receivables are recorded at amounts due less any allowance for doubtful debts.

Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off. An allowance account (provision for impairment of trade receivables) is used when there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of receivables. The amount of the allowance is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Cash flows relating to short-term receivables are not discounted if the effect of discounting is immaterial. The amount of the allowance is recognised in the profit and loss.

(o) Intangible assets

Intangibles

Internally generated intangible assets, excluding capitalised development costs, are not capitalised and expenditure is recognised in profit or loss in the year in which the expenditure is incurred.

Research and development costs

Research expenditure is recognised as an expense as incurred. Costs incurred on development projects (relating to the design and testing of new or improved products) are recognised as intangible assets when it is probable that the project will be a success considering its commercial and technical feasibility and its costs can be measured reliably. The expenditure capitalised comprises all directly attributable costs, including costs of materials, services and direct labour. Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. Capitalised development costs are recorded as intangible assets and amortised from the point at which the asset is ready for use on a straight-line basis over its useful life.

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The carrying value of an intangible asset arising from development expenditure is tested for impairment annually when the asset is not yet available for use, or more frequently when an indication of impairment arises during the reporting period.

A summary of the policies applied to the group’s intangible assets is as follows:

Policy	Patents	Development Costs
Useful lives	Finite	Finite
Amortisation methods used	Amortised over the period of expected future	Amortised over the period of expected future
	benefits from the related project on a straight- line	benefits from the related product on a
	basis	straight- line basis
Internally Generated or acquired	Acquired	Internally generated
Impairment testing	Annually and more frequently when an indication of	Annually for assets not yet available for use
	impairment exists	and more frequently when an indication of
		impairment exists. The amortisation method
		is reviewed at each financialyear end

The patents have been granted for twenty years by the relevant government agency. Therefore, the assets have been assessed as having a finite life.

Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the assets and are recognised in profit or loss when the asset is derecognised

(p) Revenue recognition

Revenues are recognised at fair value of the consideration received net of the amount of goods and services tax (GST) or value added tax (VAT) payable to the taxation authorities. Sales revenue represents sales of products or services. Sales of products are recognised when the significant risks and rewards of ownership of the goods have passed to the buyer and can be measured reliably. Risks and rewards are considered passed to the buyer at the time of delivery of the goods to the customer.

Service revenue is recognised when the fees in respect of services rendered are earned, usually when services have been provided to customers.

Accounting Standard AASB 111 Construction Contracts – the Company uses the ‘percentage of completion’ method, which states “When the outcome of a construction contract can be estimated reliably, contract revenue and contract costs associated with the construction contract shall be recognised as revenue and expenses respectively by reference to the stage of completion of the contract activity at the reporting date”. The Company uses costs incurred as the measure of percentage of completion.

Interest income is recognised on a time proportion basis using the effective interest method.

(q) Income tax

Current Tax

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

Deferred Tax

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

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In principle, deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets are recognised to the extent that it is probable that sufficient taxable income will be available against which deductible temporary differences or unused tax losses and tax offsets can be utilised. However, deferred tax assets and liabilities are not recognised if the temporary differences giving rise to them arise from the initial recognition of assets and liabilities (other than as a result of a business combination) which affects neither taxable income nor accounting profit. Furthermore, a deferred tax liability is not recognised in relation to taxable temporary differences arising from goodwill.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in associates and are only recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits of the temporary differences and that they are expected to reverse in the foreseeable future.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period(s) when the asset and liability giving rise to them are realised or settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by reporting date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis.

Current and Deferred Tax for the period

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

(r) Cash and cash equivalents

For statement of cash flow purposes, cash and cash equivalents includes cash on hand and deposits held at call with financial institutions.

(s) Contributed equity

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

If the company re-acquires its own equity instruments, for example as a result of a share buy-back, those instruments are deducted from equity and the associated shares are cancelled. No gain or loss is recognised in profit or loss and the consideration paid including any directly attributable incremental costs (net of income taxes) is recognised directly in equity.

(t) New accounting standards and Australian Accounting interpretations

New accounting standards and interpretations not yet adopted

Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2013 reporting periods and have not yet been applied in the financial report. The Group’s assessment of the impact of these new standards and interpretations is set out below.

standards	and interpretations is set out below.
AASB Amendment	Affected Standard(s)	Nature of Change to Accounting Policy	Application Date of Standard*	Application Date for Group
AASB 2012-6 (issued September 2012)	Amendments to Australian Accounting Standards - Mandatory Effective Date of AASB9 andTransition Disclosures	Defers the effective date of AASB 9 to 1 January 2015	1 Jan 15	1 Jan 15
AASB9	Financial Instruments	Changes to classificationand	1Jan 15	1Jan 15

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		measurement requirements of financial instruments.
AASB 10	Consolidated Financial Statements	Changes to classification and measurement requirements of entities requiring consolidation.	1 Jan 13	1 Jan 13
AASB 11	Joint Arrangements	Changes to classification and measurement requirements of joint arrangements.	1 Jan 13	1 Jan 13
AASB 12	Disclosure of Interests in Other Entities	Introduces new disclosure requirements for interest in associates and joint arrangements.	1 Jan 13	1 Jan 13
AASB 13	Fair Value Measurement	AASB 13 establishes a single framework for measuring fair value of financial and non financial items recognised at fair value in the statement of financial position or disclosed in notes in the financial statements.	1 Jan 13	1 Jan 13
AASB 119 (reissued September 2011)	Employee Benefits	Changes to measurement of defined benefit plans and timing of recognitionof liabilities	1 Jan 13	1 Jan 13

(u) Significant accounting estimates and judgements

Revenue Recognition

In accordance with the accounting policy detailed in note 1(p), the company recognises revenue at the fair value of the consideration received (net of the amount of GST payable) when the significant risks and reward of ownership of the goods have passed to the buyer at the time of the delivery of goods to the customer, or when services rendered are provided to customers. At the 30 June 2013 management has determined that the profits on the contracts have been recognised in the correct reporting period and that there are no future losses on any contracts that should be recognised at the 30 June 2013.

In accordance with the accounting policy detailed in note 1(p), the Company recognises revenue for construction contracts using the percentage completion method as outlined in AASB 111 – Construction Contracts. This involves reporting revenue, expenses and the profit attributable based on reliable estimates of the outcome of the construction contract.

Inventory Obsolescence

Inventories are accounted for in accordance with the accounting policy detailed in note 1(l). Where the net realisable value of inventory is lower than its cost the company recognises a provision for inventory obsolescence. At the 30 June 2013 management has determined that a provision for inventory obsolescence of $59,652 (2012: $190,226) is still required for inventory where net realisable value is lower than its cost.

Development Costs Capitalised

Development Costs have been capitalised in accordance with the accounting policy detailed in note 1(o). At the 30 June 2013 management has assessed that all of the development expenditure of $1,190,869 capitalised during the reporting period comprises all directly attributable costs, including costs of materials, services, direct labour and an appropriate proportion of overheads.

Provision for Warranties

Provisions for warranties are recognised in accordance with the accounting policy detailed in note 1(c). At the 30 June 2013 management has determined that the Group’s legal or constructive obligations as a result of past events in regard to its warranties on contracts is $97,315.

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Deferred Tax Asset

Deferred tax assets are accounted for in accordance with the accounting policy detailed in note 1(q). At 30 June 2013 management considers that it is probable that future taxable profits will be available to utilise those temporary differences.

Share-based Payment Transactions

The Company measures the cost of equity- settled transactions with employees by reference to the fair value of the equity instruments at the dated at which they are granted. The fair value is determined by an internal valuation using the BlackScholes option pricing model.

Impairment of goodwill

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

Note 2: Financial risk management

The Group’s principal financial instruments are cash and short term loans. The main purpose of these financial instruments is to raise finance for the Group’s operations. The Group has various other financial assets and liabilities such as trade receivables and trade payables, which arise directly from its operations. The Group does not enter into derivative transactions. The main risks arising from the Group’s financial instruments are interest rate risk, liquidity risk, credit risk and foreign exchange risk. The Board reviews and agrees policies for managing each of these risks.

The following table details the Group’s exposure to interest rate risk as at 30 June 2013:

Maturing

30 June 2013 Financial Liabilities Fixed Rate Other Borrowings Non-interest bearing Payables 30 June 2012 Financial Liabilities Fixed Rate Other borrowings Non-interest bearing Payables	1 year or less Over 1 to 2 years Over 2 years Total Weighted Average Active Interest Rate $ $ $ $ %
	5,323 5,688 25,658 36,669 7% 2,592,981 - - 2,592,981 2,598,304 5,688 25,658 2,629,650 85,681 - - 85,681 9% 3,949,307 - - 3,949,307 4,034,988 - - 4,034,988

Net fair value

The carrying amount of financial assets and financial liabilities recorded in the financial statements represents their respective net fair values, determined in accordance with the accounting policies disclosed in Note 1.

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Credit risk exposure

The Company's maximum exposure to credit risk at reporting date in relation to each class of recognised financial assets is the carrying amount of those assets as disclosed in the statement of financial position. There are no historical default rates in respect of receivables. Cash balances are held with financial institutions of minimum AA ratings.

Foreign exchange risk

The Company has transactions in currencies other than Australian Dollars which carry receivables and payables in the respective currency. These financial instruments are not hedged.

The Company’s exposure to foreign currency risk at the end of the reporting period, expressed in Australian dollars, was as follows:

		30 June 2013	30 June 2013				30 June 2012	30 June 2012
	USD $	EUR $	GBP $	ZAR $	SEK $	USD $	EUR $	GBP $	SGD $
Cash	405,551	-	8,612	-	-	28,236	-	78,142	-
Trade receivables	1,317,943	2,230	100,451	-	-	716,921	64,428	889,256	-
Trade payables	(1,391,700)	(340)	(35,105)	(5,049)	(2,224)	(1,019,676)	(49,224)	(271,406)	(10,374)

Interest rate risk

The Company's loan and lease arrangements are subject to fixed interest rates and therefore would not have been impacted by any increase/decrease in interest rates during the current year.

Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding through an adequate amount of committed credit facilities. Management aims at maintaining flexibility in funding by keeping committed credit lines available.

Sensitivity analysis

(i) Interest rate risk

The Company's loan and lease arrangements are subject to fixed interest rates and therefore would not have been impacted by any increase/decrease in interest rates during the current year. Accordingly, an increase in interest rates would not have impacted the company's interest expense.

(ii) Foreign exchange rate risk

Based on the financial instruments held at 30 June 2013, had the Australian dollar weakened by 5% against the US Dollar, Euro, British Pound, South African Rand & Swedish Krone, with all other variables held constant, the group’s pre-tax profit for the year would have been $690 lower. If the Australian dollar had strengthened the corresponding impact would be an increase in pre-tax profit by the same amount.

Price risk

Investments held are not listed or traded in active markets and therefore no price risk arises.

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Note 3: Revenue and expenses

Note 3: Revenue and expenses
	2013 2012 $ $
(a) Revenue Revenue from sale of goods Revenue from the rendering of services (b) Other Income Research & development grant Net foreign exchange gains Interest received Other (c) Cost of sales Cost of sales (d) Finance costs Interest: - Non-related entities - Finance lease charges (e) Operating lease payments Minimum lease payments (f) Defined contribution superannuation expense Superannuation (g) Share based payment expense Employee share option expense (h) Impairment losses – financial assets Trade receivables	17,697,978 13,605,379 1,798,664 1,677,077
	19,496,642 15,282,456
	877,254 869,483 136,013 267,908 72,060 31,985 152 87
	1,085,479 1,169,463
	10,893,685 9,267,999
	47,634 20,702 1,732 2,667
	49,366 23,369
	153,950 114,425
	370,098 330,246
	3,685 34,896
	- 36,979

Note 4: Income tax

Note 4: Income tax
	2013 2012 $ $
(a) Income tax expense / (benefits) Current tax expense Deferred tax	- 123 469,877 (200,000)
	469,877 (199,877)

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	2013 2012 $ $	2013 2012 $ $
(b) Numerical reconciliation of income tax expense to prima facie tax payable Profit / (Loss) before income tax expense Prima facie tax payable / (benefit) on profit / (loss) at 30% (2012: 30%) Tax effect of: Director and employee option expense R & D tax incentive Other Utilisation of previously unrecognised tax losses Effect of lower statutory income tax rate in the United Kingdom Movement in tax effect of unrecognised current year tax losses and deferred taxes Income tax expense / (benefit) (c) Deferred income tax assets recognised in the accounts: Deferred tax liabilities Work in Progress Unrealised foreign exchange gain Property Plant & Equipment Other Set off of Deferred Tax Liabilities Deferred tax assets Annual leave provision Long service leave provision Accrued audit fees Superannuation provision Investments Capital raising fees Provision for diminution in trading stock Provision for doubtful debts Tax losses carried forward Set off of deferred tax liabilities Deferred tax asset not brought to account as realization is not probable Net recognised deferred tax assets	2,095,061 (502,607)
	628,518 (150,782) 1,107 10,469 487,060 155,089 (24,126) 10,930 (634,098) (200,000) 11,416 7,511 - (33,094)
	469,877 (199,877)
	(357,261) - (6,107) (24,503 (402,164) (503,201) - (5,995) 765,532 533,699
		- -
	235,123 705,000

Net deferred tax assets will be brought to account when it is probable that immediate sufficient tax profits will be available against which temporary differences and tax losses can be utilised.

Franking credits available for subsequent financial years based on a tax rate of 30% are $82,768 (2012: $82,768).

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Note 5: Directors and executive disclosures

(a) Directors

The Directors of DTI Group Ltd during the year were:

• N. E. Goodey

• G. Denison

• R. Johnson

• C. Morris

• J. King

		2013 2012 $ $
Compensation by category: key management personnel Short-term benefits Post-employment benefits Share based payments		343,810 382,385 27,163 34,414 1,640 3,263
		372,613 420,062

Note 6: Auditor’s remuneration

ote 6: Auditor’s remuneration
	2013 2012 $ $
BDO Audit (WA) Pty Ltd & BDO LLP Remuneration of the auditors of the entities for: Auditing or reviewing the financial report No non-audit services have been performed by BDO during the year. ote 7: Other financial assets Term deposits	47,321 42,973
	400,063 371,680

Note 7: Other financial assets

Note 8: Trade and other receivables

ote 8: Trade and other receivables
	2013 2012 $ $
Current Trade receivables Accrued debtors Customs duty refund R&D Grant receivable Non-Current Customer retentions	2,990,400 3,003,025 574,081 566,217 28,128 32,211 876,738 869,483
	4,469,347 4,470,936
	162,210 565,304

(a) Impaired trade receivables

At 30 June 2013 current trade receivables of the Group with a nominal value of $7,651 (2012: $7,651) were impaired. It was assessed that no portion of these receivables is expected to be recovered and the full amount has been provided for.

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	2013 2012 $ $
Movements in the provision for impairment of receivables are as follows: At July 1 Provision for impairment recognised during the year Receivables written off during the year as uncollectable	7,651 - - 36,978 - (29,327)
	7,651 7,651

The creation and release of the provision for impaired receivables has been included in ‘other expenses’ in the statement of profit or loss and other comprehensive income. Amounts charged to the allowance account are generally written off when there is no expectation of recovering additional cash.

(b) Past due but not impaired

At 30 June 2013 trade receivables of $400,752 (2012: $377,857) were past due, but not impaired. These relate to a number of independent customers for whom there is no recent history of default. The ageing analysis of these trade receivables is as follows:

Up to 3 months 3 to 6 months Over 6 months	163,988 50,758 82,215 248,261 154,549 80,932
	400,752 379,951

The other classes within trade and other receivables do not contain impaired assets and are not past due. Based on the credit history of these other classes, it is expected that these amounts will be received when due. The Group does not hold any collateral in relation to these receivables.

(c) Foreign exchange and interest rate risk

Information on the group’s exposure to foreign currency risk and interest rate risk in relation to trade and other receivables is provide in note 2.

(d) Fair value and credit risk

Due to the short-term nature of these receivables, their carrying amount is assumed to approximate their fair value. The maximum exposure to credit risk at the end of the reporting period is the carrying amount of each class of receivables mentioned above.

Note 9: Inventories

e 9: Inventories
	2013 2012 $ $
Raw materials / unassembled stock Project WIP Provision for inventory obsolescence (a)	1,664,903 1,964,023 508,462 294,306 (59,652) (190,256)
	2,113,713 2,068,073

(a) A provision for inventory obsolescence was established in a previous year. It was re-assessed & adjusted this financial year and is included in the raw materials & consumables used number in the statement of profit or loss and other comprehensive income.

Note 10: Other current assets

e 10: Other current assets
	2013 2012 $ $
Deposits Prepayments	4,584 - 80,671 98,206
	85,255 98,206

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Note 11: Property, plant and equipment

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11: Property, plant and equipment
	2013 2012 $ $
Buildings At cost Less accumulated depreciation Workshop and R&D plant and equipment At cost Less accumulated depreciation Office equipment & software At cost Less accumulated depreciation Motor vehicles At cost Less accumulated depreciation Total written down value Movements in carrying amounts Buildings Balance at the beginning of the year Additions Depreciation expense Carrying amount at the end of the year Workshop and R&D plant and equipment Balance at the beginning of the year Additions Depreciation expense Carrying amount at the end of the year Office equipment & software Balance at the beginning of the year Additions Depreciation expense Carrying amount at the end of the year Motor vehicles Balance at the beginning of the year Additions Depreciation expense Carrying amount at the end of the year	107,064 104,200 (11,218) (828)
	95,846 103,372
	475,338 201,123 (214,398) (146,419)
	260,940 54,704
	712,750 622,042 (527,214) (471,495)
	185,536 150,547
	142,917 102,427 (53,377) (36,974)
	89,540 65,453
	631,862 374,076
	103,372 - 2,864 104,200 (10,390) (828)
	95,846 103,372
	54,704 66,688 274,215 10,328 (67,979) (22,312)
	260,940 54,704
	150,547 178,483 102,798 50,397 (67,809) (78,333)
	185,536 150,547
	65,453 58,717 40,490 20,046 (16,403) (13,310)
	89,540 65,453

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Note 12: Intangible assets

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	Development costs Goodwill Patents Total $ $ $ $
At 30 June 2012 Cost (gross carrying amount) Accumulated amortisation Net carrying amount At 30 June 2013 Additions at Cost (gross carrying amount) Accumulated amortisation Net carrying amount	3,144,938 2,432 80,238 3,227,608 (786,416) - (7,983) (794,399)
	2,358,522 2,432 72,255 2,433,209 1,190,868 - 21,255 1,212,123 (777,698) - (8,006) (785,704)
	2,771,692 2,432 85,504 2,859,628

(a) Description of the Group’s intangible assets

(i) Development costs

Development costs are carried at cost less accumulated amortisation and accumulated impairment losses. The intangible assets in existence as at 30 June 2012 have been assessed as having a finite life and are amortised using the straight line method over a period of 4 years. Intangible assets arising from 1 July 2013 are amortized in proportion to the sales of the commercial units they relate to, as this is deemed to be a more accurate and reasonable basis. If an impairment indication arises, the recoverable amount is estimated and an impairment loss is recognised to the extent that the recoverable amount is lower than the carrying amount.

The recoverability of the carrying amount of the product development assets is dependent on ongoing commercial sale of the product developed or alternatively, sale of the business.

(ii) Goodwill

Goodwill has been externally acquired and is carried at cost less accumulated impairment losses. The goodwill arose on the acquisition of the remaining 50.5% of Virtual Observer Pty Ltd on 28[th] June 2012 and represents the difference between the purchase price and the net liabilities.

(iii) Patents

Patents have been externally acquired and are carried at cost less accumulated impairment losses. This intangible asset has been assessed as having a useful life and is amortised using the straight line method over a period of 10 years. The patents have been granted for between fifteen and twenty years by the relevant government agency. If an impairment indication arises, the recoverable amount is estimated and an impairment loss is recognised to the extent that the recoverable amount is lower than the carrying amount.

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Note 13: Other financial assets

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Note 13: Other financial assets
	2013 2012 $ $
(a) Movement in carrying amount of investment in associates Fair value movement of investment in associate Share of profit / (loss) after income tax Carrying amount at the end of the financial year	- (29,638) - 29,725
	- 87

(b) Summarised financial information of associates

The company's share of the results of its principal associates and its aggregated assets (including goodwill) and liabilities are as follows:

The Company's share of:

			Ownership
			Interest	Assets	Liabilities	Revenues	Profit (Loss)
			%	$	$	$	$
	2013
	Virtual Observer Pty Ltd		n/a	n/a	n/a	n/a	n/a
	2012
	Virtual Observer Pty Ltd *		100	n/a	n/a	33,234	29,725
	�	Virtual Observer Pty Ltd	was an associate during 2012.
						2013	2012
						$	$
(c)	Deferred Tax Asset
	Deferred tax assets to be recovered within 12 months					235,123	705,000
	Deferred tax assets to be recovered after more than 12 months					-	-
						235,123	705,000

Note 14: Trade and other payables

14: Trade and other payables
	2013 2012 $ $
Trade payables Other payables ATO & HMRC (incl PAYG) Provision for annual leave Supplier retentions payable Superannuation liability FBT liability Payroll tax liability	2,133,740 2,265,990 264,922 503,652 53,381 853,640 311,995 288,216 10,145 101,448 98,263 94,291 (7,629) 18,358 40,160 111,928
	2,904,977 4,237,523

(a) Risk exposure

Information about the Group’s exposure to foreign exchange is provided in Note 2.

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Note 15: Borrowings (current)

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15: Borrowings (current)
	2013 2012 $ $
Secured: Loan - CBFC Ltd and Capital Finance Australia Ltd Less: Unexpired Interest Net loan carrying amount - CBFC Ltd and Capital Finance Australia Ltd Unsecured: Premium Funding Loan Less: Unexpired Interest Net carrying amount of Premium Funding Total current borrowings	7,603 27,905 (2,280) (1,732)
	5,323 26,173
	- 57,776 - (4,733)
	- 53,043
	5,323 79,216

(a) Further information on loans from related parties is set out in note 25.

(b) The loans were based on normal commercial terms and conditions.

(c) Refer to note 2 for risk exposures and risk management details.

Note 16: Borrowings (non-current)

16: Borrowings (non-current)
	2013 2012 $ $
Loan - Capital Finance Australia Ltd Less: Unexpired Interest Net carrying amount - Capital Finance Australia Ltd loan Total non-current borrowings	36,480 - (5,134) -
	31,346 -
	31,346 -

(a) Refer to note 2 for risk exposures and risk management details.

Note 17: Provisions

te 17: Provisions
	2013 2012 $ $
Current Warranty provision Non-current Warranty provision Employee entitlements - long service leave Total non-current provision	97,315 72,394 - 98,559 46,371 34,556
	46,371 133,115

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Note 18: Contributed Equity

Note 18: Contributed Equity
	2013 2013 2012 2012 No. $ No. $
(a) Ordinary shares Balance at the beginning of financial year Shares issued on option conversion Shares issued on new placements Shares issued on conversion of notes Capital raising costs Balance at the end of the financial year	10,876,117 9,202,481 10,376,117 8,952,481 27,956 36,903 500,000 250,000 - - - - - - - - - - - -
	10,904,073 9,239,384 10,876,117 9,202,481

Fully paid ordinary shares carry one vote per share and carry the right to dividends. Share issues were for working capital requirements and business expansion.

(b) Options

The following options to issue ordinary shares were on issue as at 30 June 2013.

Number of	Grant date	Expiry date	Exercise
Options			price
1,767,258	30 June 2011	30 June 2015	$2.25

See Note 20 for details on share based payments.

Note: 19 Reserves and accumulated losses

		2013	2012 $
		$
(a) Reserves Option reserves Balance 1 July Option expense for the year Balance 30 June The share option reserve records items recognised as expenses on valuation of employee share options and items recognised as expenses on fair valuation of options issued for cash consideration or that are free attaching.			1,118,376 34,896
		1,153,272
		3,685
		1,156,957	1,153,272
			2012 $
		2013
		$
(b) Accumulated losses Movements in accumulated losses were as follows: Balance 1 July Net profit / (loss) for the year Balance 30 June			(2,676,486) (302,730)
		(2,979,216)
		1,625,184
		(1,354,032)	(2,979,216)

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Note 20: Share-based payments

The following share-based payment arrangements existed at 30 June 2013:

On 30 June 2013 there were 1,767,258 unlisted options over ordinary shares issued pursuant to a subscription agreement with Finico Pty Ltd. The options have a four year term and are exercisable at $2.25 on or before 30 June 2015.

The following table contains the number (“No”), weighted average exercise prices (WAEP) of and movements in share options issued during the year:

issued during the year:
	2013 WAEP 2012 WAEP No. $ No. $
Outstanding at the beginning of the year Granted during the year Forfeited during the year Exercised during the year Outstanding at the end of the year Exercisable at the end of the year	2,289,258 2.05 2,789,258 1.77 - - (494,044) 1.36 - (27,956) 1.32 (500,000) 0.50
	1,767,258 2.25 2,289,258 2.05
	1,767,258 2.25 2,289,258 2.05

Note 21: Capital and leasing commitments

(a) Finance lease commitments

The Company signed two motor vehicle leases commencing in April 2013. The leases are 5 year finance leases with lease payments paid monthly in advance. There are no terms of renewal, purchase options or escalation clauses in respect of the leases.

	2013 2012 $ $
Minimum finance lease payable: Not later than 1 year Later than 1 year but not later than 5 years Minimum lease payments Future finance charges Present value of minimum lease payments	7,603 27,905 36,480 -
	44,083 27,905 (7,414) (1,732)
	36,669 26,173

(b) Operating lease commitments

The company signed an operating lease in June 2012 for the land on which the office and workshop facilities are situated with a lease term of 5 years, with the option to extend for a further 5 years. The company does not have the option to purchase the leased asset at the expiry of the lease

The company signed an operating lease in June 2012 for computer equipment with a lease terms of 3 years. The company does not have the option to purchase the leased asset at the expiry of the lease.

Non-cancellable operating lease payable: Not later than 1 year Later than 1 year but not later than 5 years	145,010 128,711 389,326 46,332
	534,336 527,647

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Note 22: Contingent liabilities

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e 22: Contingent liabilities
	2013 2012 $ $
Bank guarantees for unconditional undertaking of contracts These are secured by term deposits.	400,063 371,680

Note 23: Subsequent events

No matters or circumstance have arisen that have significantly affected, or may significantly affect, the operations of DTI Group Limited, the results of those operations or the state of affairs of DTI Group Limited in subsequent years that is not otherwise disclosed in this report.

Note 24: Notes to the cash flow statement

(a) Reconciliation of cash

For the purpose of the cash flow statement, cash includes cash on hand and in banks and short term deposits with banks. Cash at the end of the financial year as shown in the cash flow statement is reconciled to the related items in the statement of financial position as follows:

of financial position as follows:
	2013	2012 $
	$
Cheque account British Sterling bank account US Dollar bank account Petty cash (b) Reconciliation of profit / (loss) after income tax to the net cash used in operating activities Operating profit / (loss) Non-cash items: Depreciation & amortisation Employee share option expense Grant income Change in operating assets and liabilities - (Increase) / decrease in trade and other receivables - (Increase) / decrease in inventories - Increase / (decrease) in trade and other payables - (Increase) / decrease in financial asset - Increase / (decrease) in provision Net inflow / (outflow) from operating activities	756,535	702,322 78,142 28,235 3,515
	8,612
	405,551
	(258)
	1,170,440	812,214
		(302,730) 644,556 34,896 - (1,118,260) (700,937) 1,455,419 (199,964) 171,279
	1,606,630
	948,285
	3,685
	(877,254)
	1,313,445
	(45,640)
	(1,332,546)
	469,964
	(61,823)
	2,024,746	(15,741)

Shares were issued to employees under the Group Share Option Plan (refer Note 20: Share-based payments).

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Note 25: Related party transactions

The Company has related party relationships with its subsidiaries & associates (see note 13).

Subsidiaries & Associates

DTI Group Limited holds 100% (2012: 100%) of the shares in Virtual Observer Pty Ltd. A loan was created during the current and prior years when payments were made by DTI Group Limited on behalf of Virtual Observer Pty Ltd. At reporting date 2013 this loan balance was $61,517 (2012: $54,298).

DTI Group Limited holds 100% of the shares in DTI EMEA Ltd. A loan was created during the previous year when payments were made by DTI Group Ltd to DTI EMEA Ltd. At reporting date 2013 this loan balance was $585,423 (2012: $307,598). In addition, sales were made during the year by DTI Group Ltd to DTI EMEA Ltd and at reporting date the debtor balance was $285,782 (2012: $617,198).

Note 26: Parent entity financial information: DTI Group Ltd

The individual financial statements for the parent entity show the following amounts:

	2013 2012 $ $
Balance sheet Current assets Total assets Total liabilities Shareholders’ equity: Issued capital Share option reserve Accumulated losses Profit / (loss) for the year Total comprehensive income / (loss)	8,350,210 7,121,381 12,161,478 11,157,654 (2,921,716) (3,681,059) 9,239,384 9,202,481 1,156,957 1,153,272 (1,156,580) (2,879,158)
	9,239,761 7,476,595
	1,722,578 (202,671)
	1,722,578 (202,671)

Note 27: Prior period restatement

The Group has restated its 30 June 2012 financial statements in relation to a supply and install contract entered into by subsidiary DTI EMEA Ltd, whereby the revenue should be recognised when the service is complete rather than when the payment profile allows per the contract. As such, the revenue is recognised upfront at the net present value of the 20 instalments. The most significant impact of this correction is to recognise a receivable and revenue of $566,217. As the contract for supply and install has been completed there should be no Work in Progress (WIP); therefore the full cost of sale has been recognised and the WIP reversed.

On further review of the above revenue contract, a warranty period was identified with respect to the goods installed and the works performed on any given unit. The warranty period is 2 years from the date of redelivery of such unit. A warranty provision has been raised in the amount of $170,952.

In addition, there have been other restatements to 30 June 2012 that came out of the audit of DTI EMEA Ltd that was only carried out after finalisation of the 2012 Annual Report.

Theses corrections have been recorded by restating each of the affected financial statement line items for the prior period as follows:

DT I GRO U P L IMIT ED – ANNU AL RE PORT 201 3

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Consolidated Statement of Financial Position (extract)	As reported 30 June 2012	2012 Increase / (Decrease) Restated 30 June 2012	2011 As reported 30 June 2011 Increase / (Decrease) Restated 30 June 2011
Trade Receivable 3,886,388 Inventories 2,516,626 Other current assets 86,748 Warranty Provision - Trade and other payables (4,185,407) Net assets 7,452,152 Consolidated Statement of Profit or Loss and Other Comprehensive Income(extract)	3,886,388 2,516,626 86,748 - (4,185,407)	584,548 4,470,936 (448,553) 2,068,073 11,458 98,206 (170,952) (170,952) (52,116) (4,237,523) (75,615) 7,376,537 As reported 30 June 2012	3,352,676 - 3,352,676 1,367,136 - 1,367,136 92,920 - 92,920 - - - (2,782,104) - (2,782,104)
	7,452,152		7,394,371 - 7,394,371
			(Increase) / Decrease Restated 30 June 2012
Revenue from continuing operations Other income Change in inventory of finished goods Raw materials and consumables used Administration expense Loss for the year before tax Income tax benefit Loss for the year after tax Other comprehensive income/(loss) Total comprehensive loss for the year Net loss is attributable to: Owners of DTI Group Ltd Total comprehensive income is attributable to: Owners of DTI Group Ltd Consolidated Statement of Cash Flows (extract)		14,762,644 1,137,552 (644,407) (8,170,561) (1,258,396)	(519,812) 15,282,456 (31,911) 1,169,463 (938,713) 294,306 803,132 (8,973,693) (174,307) (1,432,703)
		(426,992) 199,877	(75,615) (502,607) - 199,877
		(227,115) -	(75,615) (302,730) - -
		(227,115)	(75,615) (302,730)
		(227,115)	(75,615) (302,730)
		(227,115) As reported 30 June 2012	(75,615) (302,730) (Increase) / Decrease Restated 30 June 2012
Net cash (used in) operating activities Net cash (used in) investing activities Net cash (used in) financing activities		- - -	- - - - - -

The restatement had no impact on the Group’s 30 June 2011 financial statements.

Note 28: Company information

DTI Group Limited is an unlisted public company, incorporated and operating in Australia.

Registered office and principal place of business

50 Affleck Road Perth Airport, WA, 6105 Tel: (08) 9479 1195 Internet: www.dti.com.au

DT I GRO U P L IMIT ED – ANNU AL RE PORT 201 3

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Directors’ declaration

In the opinion of the directors of DTI Group Limited ("the Company"):

1. The financial statements and accompanying notes set out on pages 10 – 36 are in accordance with the Corporations Act 2001 , and:

2. (i) comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; and

3. (ii) give a true and fair view of the consolidated entity’s financial position as at 30 June 2013 and of its performance for the year ended on that date.

4. 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.

5. The company has included in the notes to the financial statements an explicit and unreserved Statement of Compliance with International Financial Reporting Standards.

This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the Directors by:

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Richard Johnson Director

31 October 2013, Perth, Australia

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Tel: +8 6382 4600 38 Station Street Fax: +8 6382 4601 Subiaco, WA 6008 www.bdo.com.au PO Box 700 West Perth WA 6872 Australia

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INDEPENDENT AUDITOR’S REPORT

To the members of DTI Group Limited

Report on the Financial Report

We have audited the accompanying financial report of DTI Group Limited, which comprises the consolidated statement of financial position as at 30 June 2013, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity comprising the company and the entities it controlled at the year’s end or from time to time during the financial year.

Directors’ Responsibility for the Financial Report

The directors of the company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In Note 1, the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements , that the financial statements comply with International Financial Reporting Standards .

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance about whether the financial report is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the company’s preparation of the financial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report.

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

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms.

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Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001 . We confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of DTI Group Limited, would be in the same terms if given to the directors as at the time of this auditor’s report.

Opinion

In our opinion:

• (a) the financial report of DTI Group Limited is in accordance with the Corporations Act 2001 , including:

• (i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2013 and of its performance for the year ended on that date; and

• (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001 ; and

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

BDO Audit (WA) Pty Ltd

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Glyn O’Brien

Director

Perth, 31 October 2013

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38 Station Street Subiaco, WA 6008 PO Box 700 West Perth WA 6872 Australia

Tel: +8 6382 4600 Fax: +8 6382 4601 www.bdo.com.au

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DECLARATION OF INDEPENDENCE BY GLYN O’BRIEN TO THE DIRECTORS OF DTI GROUP LIMITED

As lead auditor of DTI Group Limited for the year ended 30 June 2013, I declare that, to the best of my knowledge and belief, there have been no contraventions of:

• the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and

• any applicable code of professional conduct in relation to the audit.

This declaration is in respect of DTI Group Limited and the entities it controlled during the period.

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Glyn O’Brien

Director

BDO Audit (WA) Pty Ltd

Perth, 31 October 2013

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms.

D TI G R O UP L IM IT E D – AN N U AL RE PO R T 20 1 3

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