ECP EMERGING GROWTH LIMITED - Annual Report 2016

2016 Annual Report

FINANCIAL YEAR END

30 June 2016

SHARES TRADED EX DIVIDEND 6 September 2016

DIVIDEND BOOKS CLOSE 7 September 2016

DIVIDEND PAYMENT 23 September 2016

ANNUAL GENERAL MEETING The Annual General Meeting of Barrack St Investments Limited: WILL BE HELD AT: The office of Rothsay Chartered Accountants Level 1 12 O’Connell Street SYDNEY NSW 2000

TIME: 11.00am (NSW Time) DATE: Friday 18 November 2016

INVESTING IN BARRACK ST INVESTMENTS LIMITED

Investors can purchase shares in Barrack St Investments Limited through the Australian Securities Exchange.

ASX code: BST

Barrack St Investments Limited ABN 30 167 689 821 Registered in Australia 23 January 2014 and listed on ASX in August 2014

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BARRACK ST INVESTMENTS LIMITED DIRECTORS (from left to right)

Dr Manny Pohl, Murray d’Almeida and David Crombie AM

Chairman’s Report	7
Directors’ Report	8
Auditor’s Independence Declaration	13
Corporate Governance Statement	14
Financial Report	18
Directors’ Declaration	35
Independent Auditor’s Report	36
Shareholder Information	37
Investments	38
Corporate Directory	39

HIGHLIGHTS FOR 2016

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Highlights for the year ending June 2016

The portfolio before fees and tax increased by 24.8% versus a 2.6% decrease in the All Ordinaries Index over the twelve month period.
The Net Tangible Assets (NTA) per share increased by 15.8% after tax (on realised gains only).
Dividends of 1.5 cents comprising a 1.0 cent final dividend (2015) and a 0.5 cent interim dividend (2016) were paid during the year.

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Barrack St Investments Performance vs. the All Ordinaries Index

Dividends per share (as declared)

Year to	Portfolio Return Pre Fees	NTA (on Realised Gains Only)	All Ordinaries Index

June-15	3.4%	-3.6%	-3.1%
June-16	24.8%	15.8%	-2.6%

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Interim Dividend
Cent Final Dividend
3.00
2.50
2.00
1.50
1.00
0.50
0.00
2015 2016
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Barrack St Investments Limited

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Major Investments June 2016

Sector Breakdown June 2016

Benchmark Comparison

TOP 10 INVESTMENTS

TOP 10 INVESTMENTS	TOP 10 INVESTMENTS	TOP 10 INVESTMENTS
	June 16	June 15
IPH Limited	11.3%	3.0%
Trade Me Group	8.7%	6.2%
Aconex limited	8.4%	0%
BT Investment Management	8.2%	0%
Magellan Financial Group Ltd	8.0%	0%
REA Group	7.5%	11.7%
Sirtex Medical	7.5%	3.8%
Carsales.Com Ltd	7.1%	11.5%
Reliance Worldwide	4.3%	0%
Catapult Group International Ltd	3.9%	4.1%
TOTAL	74.9%	40.3%

SECTOR BREAKDOWN

SECTOR BREAKDOWN	SECTOR BREAKDOWN
Financials	22.6%
Consumer Discretionary	19.5%
Information Technology	19.3%
Industrials	18.2%
Health Care	10.5%
Cash	9.9%
TOTAL	100.0%

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ACTIVE SECTOR WEIGHTS to the
ALL ORDINARIES BREAKDOWN
30%
20%
10%
0%
-10%
-20%
I.T. Cons Discret Industrials Health Care Utilities Energy Telcos' Cons Staples Materials Financials
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Barrack St Investments Limited

OVERVIEW

COMPANY PROFILE

Barrack St Investments Limited (the “Company”) listed on the Australian Securities Exchange (ASX) in August 2014 and is a listed investment company providing investors with access to an expertly crafted quality portfolio of Australian small and mid-cap growth companies.

The portfolio is managed by ECP Asset Management Pty Ltd, which has a strong funds management investment team renowned for its stability, track record and sound investment process.

The composition and performance of the investment portfolio is monitored by the Board of Directors, which comprises business people with many years of experience in the business, investment and funds management industries.

There is a management fee of 1% p.a. payable annually. The Manager receives a fee which is performance based and payable annually in arrears if the Company's investments outperform an absolute return of 8%. If the Company's net performance is less than the returns on 8%, no performance fee is payable ensuring the Manager is focused on absolute returns to Shareholders (“Shareholders”).

MISSION

Creating Shareholder wealth through active management of a portfolio of ASX listed small and midcap quality growth companies.

INVESTOR BENEFITS

The benefits for investors in Barrack St Investments Limited are:

Reduced share investment risk through a diversified investment portfolio;
Professional and disciplined management of an investment portfolio;
Fully franked dividend income;
Access to tax advantages of Listed Investment Company Capital Gains when available;
Access to a Dividend Reinvestment Plan;
No entry or exit charges made by the Company; and
Easy access to information via the Company’s head office or website www.barrackst.com.

INVESTMENT MANAGER

The management of the Company’s investment portfolio is undertaken by ECP Asset Management Pty Ltd, with administration support from EC Pohl & Co Pty Ltd.

The Manager’s investment philosophy is built on the belief that the economics of business drives long-term investment returns. Investing in high quality businesses that have the ability to generate predictable, above average economic returns, will produce superior investment performance over the long-term.

OBJECTIVES

The investment objectives of Barrack St Investments Limited are:

To achieve medium to long-term capital growth and income through investing in a diversified portfolio of small and mid-cap Australian companies;
To preserve and enhance the NTA backing per share after allowing for inflation; and
To provide Company Shareholders with a fully franked dividend which, over time, will grow at a rate in excess of the rate of inflation.

The Company's portfolio of investments comprises companies whose operations cover a wide spectrum of business activities and the portfolio is constructed from the perspective of a business owner, by investing in well managed companies and not simply by tracking the index weighting of various component stocks.

Dr Emmanuel (Manny) Pohl is the Chairman of EC Pohl & Co Pty Ltd, which is the holding company of ECP Asset Management Pty Ltd. ECP Asset Management Pty Ltd is an authorised representative of EC Pohl & Co Pty Ltd, which holds an AFSL.

Information on the Investment Manager is available from www.ecpam.com .

Barrack St Investments Limited

CHAIRMAN’S REPORT

Dear Shareholder,

It gives me great pleasure to present the third Annual Chairman’s Report of Barrack St Investments Limited.

At 30 June 2016 the Net Assets of the Company increased by $2,052,379 (13.2.%) and the Net Asset backing per share, before deferred tax on unrealised gains increased to $1.12 per share, an increase of 15.8%. In spite of the volatility in global markets. Our investments performed extremely well, out-performing the All Ordinaries Index which declined by 2.58% over the past year. Utilities, Health Care and Discretionary were the best-performing sectors in FY16 and, despite a strong second half, the Energy and Materials sectors performed poorly, while the Banks were the major detractors from the performance of the Index.

During the year, it was very pleasing to see that a number of Shareholders reinvested their dividends into the Company through the Dividend Reinvestment Plan, offered to Shareholders with respect to the dividends paid in Oct 2015 and April 2016. The total number of shares in issue at 30 June 2016 increased by 31,679 shares to 16,069,468.

Finally, I wish to thank my fellow Board members, Company Secretary, our Consultants and in particular the staff of ECP Asset Management Pty Ltd for their input and support in the past year and we, (including myself as Chairman) look forward to the year ahead.

Yours sincerely

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Murray H d’Almeida Chairman

When the Company was listed on the ASX on 14 August 2014, securities were issued comprising one Option and one ordinary share. Whilst some of these Options have been exercised, the remainder expired on 17 August 2016.

The Company was listed on the ASX on 14 August 2014 and was formed to satisfy a growing appetite for access to boutique investment managers with an expertise in small and mid-cap companies.

ECP Asset Management, led by Manny Pohl (Chief Investment Officer) and who has a long and successful track record in investment management, manages the portfolio of investments of the Company. Your Board believes that the performance to date is testimony of the investment philosophy implemented by ECP Asset Management.

Your Board remains optimistic about the future and in our view, companies with good strong management and healthy balance sheets will continue to perform well and reward our Shareholders over the longer term. I look forward to your continued support.

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Barrack St Investments Limited

DIRECTORS' REPORT

Your Directors present their report on Barrack St Investments Limited for the financial year ended 30 June 2016.

1. DIRECTORS

The following persons were Directors of Barrack St Investments Limited from the beginning of the financial year until the date of this report, unless otherwise stated: Murray H d’Almeida, Dr Emmanuel (Manny) C Pohl, David C Crombie AM and Jared D Pohl.

2. INFORMATION ON DIRECTORS

Murray H d’Almeida

FAICD

Chairman, Independent Director Member of Audit and Risk Committee

Experience and expertise

Director since the inception of the Company in 2014. Over 35 years of diverse national and international business experience. Founded the Retail Food Group and developed a presence in seven overseas countries. Subsequently has maintained operating and board positions within a range of financial services, mining, commercial, academic, government and sporting businesses and organisations.

Other Current directorships

Chairman of Pacific Environment Limited Chairman of Management Resource Solutions PLC Chairman of BPS Technology Limited Councillor Southern Cross University Trustee of Currumbin Wildlife Foundation Member of Gold Coast Light Rail Business Advisory Board

Former Listed Company directorships in last 3 years None

Dr Emmanuel (Manny) C Pohl

Pr Eng, B.Sc (Eng), MBA, DBA, FAICD, MSAA, F Fin Executive Director and CEO

Experience and expertise

Director since the inception of the Company in 2014. Extensive experience in the funds management industry.

Other current directorships

Managing Director of Global Masters Fund Limited Managing Director of Flagship Investments Limited Chair of Athelney Trust Plc Chairman of EC Pohl & Co Pty Ltd Director of ECP Asset Management Pty Ltd Director of Bond University Limited Director of Huysamer International Holdings (Pty) Ltd Trustee of Currumbin Wildlife Hospital Foundation

Former Listed Company directorships in last 3 years None.

Interest in Shares

4,823,716 ordinary shares

Has a relevant interest in shares in the Company over which he holds a Power of Attorney arrangement with a number of Shareholders.

Interest in Shares

5,000 ordinary shares

Barrack St Investments Limited

David C Crombie AM B . Econ (UQ)

Non-Executive Director Chair of Audit and Risk Committee

Experience and expertise

Director since 2014

Extensive business experience as founding partner in Palladium Group (formerly GRM International), with 1600 professional staff engaged on development projects in 26 countries across a range of sectors including health, education, agricultural services and capacity building for AusAid, DIFID and USAid plus multilateral and Government /private sector clients. Retired as Managing Director in 2000 and remains on the Board.

Currently managing agricultural and livestock projects across northern Australia.

Formerly President of the National Farmers Federation, Chairman Meat and Livestock Australia and President of Australian Rugby Union.

Jared D Pohl B.Com, B.IT, MBA

Alternate Director

Experience and expertise

Alternate Director since 23 June 2014. Jared has over 10 years investment experience. Prior to establishing ECP Asset Management alongside Manny, Jared was a member of the Hyperion Asset Management investment team where he undertook general company research, with a focus on the technology sector. In addition, he was tasked with managing the firm’s equity trading function.

Most recently Jared was seconded to Wasatch Advisors in Salt Lake City where he worked alongside their Private Market team, looking for pre-IPO investment opportunities.

Prior to financial services Jared consulted on a number of IT projects and has been involved extensively in the tech start-up space.

Other current directorships

Director Australian Agricultural Company (AAC) Director Alliance Aviation Services (AQZ) Director of Palladium Group

Former Listed Company directorships in last 3 years None

Interest in Shares 105,636 ordinary shares

Other current directorships : Director of ECP Asset Management Pty Ltd Director of EC Pohl & Co Pty Ltd

Former Listed Company directorships in last 3 years None

Interest in Shares 15,000 ordinary shares

Barrack St Investments Limited

DIRECTORS’ REPORT (Continued)

3. PRINCIPAL ACTIVITIES

The principal activity of the Company is investing in securities listed on the Australian Securities Exchange.

4. REVIEW OF OPERATIONS

Our portfolio outperformed the market, increasing by 24.8% over the twelve months, while the NTA increased by 15.8% after paying a dividend of 1.5 cents per share to Shareholders during the year.

Overall performance of the Australian equity market was driven by a heightened level of uncertainty in the World’s major economies and local investors seeking yield. The Australian share market, as represented by the All Ordinaries Index, decreased by 2.6%.

Once again high quality businesses were recognized as such by the market and marked up, while the speculative resource companies remain under pressure.

As our investment horizon is three to five years, we believe there is significant capital appreciation potential for the portfolio.

5. SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

Significant changes in the state of affairs of the Company during the financial year were as follows:

The value of the portfolio before fees and taxes increased by 24.8%.
29,679 shares were issued in terms of a Dividend Reinvestment Plan (DRP) which was offered during the year.
2,000 Options were exercised.

6. MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR

Options expired on 17 August 2016 and the outcome was that 2,222,000 of the Options were exercised at $1 each. When the Company listed in August 2014, all Shareholders received an Option for each Share.

Other than the dividend declared as per item 9, no other matter or circumstance not otherwise dealt with in the Director’s Report or Financial Report, which has arisen since the end of the year that has significantly affected, or may significantly affect the operations of the Company, the results of those operations or the state of affairs of the Company in future financial years.

7. LIKELY DEVELOPMENTS AND EXPECTED

RESULTS OF OPERATIONS

There are no planned changes to principal activities. Any general decline in equity markets may have an adverse effect on results in future years.

8. ENVIRONMENTAL ISSUES

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

9. DIVIDENDS PAID

TYPE	TYPE	CENTS PER SHARE	TOTAL AMOUNT $’000S	DATE OF PAYMENT	DATE OF PAYMENT


The	dividendspaid to	Shareholders duringthe financialyear were as			follows
Final		0.5	80	September 2016
Interim		1.0	160	April 2015
		1.5	240
Dividends paid by the Company during the preceding year were:
Final		0.5	80	April 2015
		0.5	80

The final dividend paid in September 2015 and the interim dividend paid in April 2016, were fully franked.

In addition to the above dividends, since the end of the financial year the Directors have recommended the payment of a franked final dividend of $274,342 (1.5 cents per share) to be paid on 23 September 2016. There is a LIC attributable amount attached to these dividends, refer to Note 15 (d).

10. EARNINGS PER SHARE

Based on profit after income tax.

	2016	2015
	Cents	Cents
Basic earnings per share	7.76	0.249
Diluted earnings per share	7.76	0.249

As a result of moving to AASB 9 Total Comprehensive Income is a more appropriate base for detailing earnings per share.

	2016	2015
	Cents	Cents
Basic earnings per share	13.08	0.743
Diluted earnings per share	13.08	0.743
See Note 16 of the Financial Report.

11. COMPANY SECRETARY

Brian Jones B.Com, FCA

Brian Jones is a Chartered Accountant and a partner of Rothsay Chartered Accountants in Sydney. He has been Company Secretary of Barrack St Investments Limited since August 2014. He has over 35 years’ experience in the accounting and finance industries and is currently Company Secretary of two other listed Companies.

12. MEETINGS OF DIRECTORS

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

	BOARD	BOARD	AUDIT AND RISK COMMITTEE	AUDIT AND RISK COMMITTEE


Director	Eligible to attend	Attend	Eligible to attend	Attend

M H d’Almeida	4	4	4	4
Dr E C Pohl	4	4	4	4
D Crombie AM	4	4	4	4
J D Pohl	4	4	4	4

Barrack St Investments Limited

13. REMUNERATION REPORT (AUDITED)

The remuneration report is set out under the following main headings:

(A) Principles used to determine the nature and amount of remuneration
(B) Details of remuneration
(C) Service agreements
(D) Share-based compensation
(E) Related Party Transactions
(F) Equity Instrument Disclosure relating to Key Management Personnel
(A) Principles used to determine the nature and

amount of remuneration

Fees and payments to Directors reflect the demands which are made on, and the responsibilities of, the Directors.

No remuneration consultants were engaged during the year.

The per annum remuneration of the Directors remained unchanged from previous year:

unchanged from previous year:
 Chairman	$46,125
 Other Directors	$41,000

Remuneration of Directors is determined by the Board within the maximum amount of $200,000 previously approved by the Shareholders.

There is no performance based remuneration for Directors.

(B) Details of remuneration

Details of the remuneration of each Director of Barrack St Investments Limited and the executives of the Company are set out in the following table.

DETAILS OF REMUNERATION

DETAILS OF REMUNERATION	DETAILS OF REMUNERATION	DETAILS OF REMUNERATION	DETAILS OF REMUNERATION	DETAILS OF REMUNERATION	DETAILS OF REMUNERATION	DETAILS OF REMUNERATION	DETAILS OF REMUNERATION	DETAILS OF REMUNERATION
	Year	Short-term Benefits			Post-	Equity		Total $
Director		Fees $	Performance Fees $	Non- monetary Benefits $	Employment Super $	Shares	Options
						$	$


M H d’Almeida Non-executive Chairman	2016	46,125	-	-	-	-	-	46,125
	2015	46,125	-	-	-	-	-	46,125
Dr E C Pohl Executive Director, CEO	2016	41,000	-	-	-	-	-	41,000
	2015	41,000	-	-	-	-	-	41,000
D Crombie AM Non-executive Director	2016	41,000	-	-	-	-	-	41,000
	2015	41,000	-	-	-	-	-	41,000
Total Directors Remuneration	2016	128,125	-	-	-	-	-	128,125
	2015	128,125	-	-	-	-	-	128,125

(C) Service agreements

As the Company does not employ any staff, there are no employment service agreements entered into by the Company. The Company Secretary is employed by Rothsay Chartered Accountants and the CEO is employed by the Investment Manager – ECP Asset Management Pty Ltd.

(D) Share-based compensation

No share-based compensation exists.

(E) Related Party Transactions

	2016	2015
The following transactions occurred with other related parties:	$	$
Expenses paid or payable by the Company to:
– ECP Asset Management Pty Ltd for Performance Fee	425,864	-
A Performance Fee and Management Fee was payable in accordance with the Management
Services Agreement as detailed in Note 22.

Dr E C Pohl has an interest in the transaction as during the year Dr E C Pohl was a Director of
ECP Asset Management Pty Ltd.
– ECP Asset Management Pty Ltd for Management Fee.	183,185	126,444
– Rothsay Chartered Accountants	36,900	35,362
Fees paid in respect of Corporate Secretarial and CFO services.
All related party transactions are made on an arm’s length basis using the standard terms and conditions.

Barrack St Investments Limited

DIRECTORS’ REPORT (Continued)

(F) Equity Instrument Disclosure relating to Key Management Personnel

The number of shares in the Company held during the financial year by each Director of Barrack St Investments Limited, including their related parties is set out below. There were no shares granted during the year as compensation.

2016	Balance At The Start Of	Received During The Year By	Other Changes During	Balance At the End Of The Year
	The Year	Exercise Of Rights	The Year

M H d’Almeida	5,000	-	-	5,000
Dr E C Pohl	4,823,716	-	-	4,823,716
D Crombie AM	64,382	-	41,254	105,636

END OF REMUNERATION REPORT (AUDITED)

14. GENERAL TRANSACTIONS

Other than the Director’s remuneration, the Company does not directly contract with any of the Directors.

15. LOANS

There are no loans issued to any of the Directors (30 June 2015 – Nil).

16. OPTIONS

No options have been issued during or since the financial year (30 June 2015 – Nil).

17. INSURANCE OF OFFICERS AND/OR AUDITORS

During the financial year the Company insured the Directors and Officers against certain liabilities as permitted by the Corporations Act 2001 . The insurance policy prohibits disclosure of the nature of the cover, the amount of the premium, the limit of liability and other terms.

The Company has entered into an agreement for the purpose of indemnifying Directors and Officers, to the extent permitted by law, against any liability (including the costs and expenses of defending actions for an actual or alleged liability) incurred in their capacity as a Director and Officer of the Company.

The Company has not during or since the financial year indemnified or paid any insurance premiums to indemnify the auditors.

18. 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 proceeding 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 .

19. NON-AUDIT SERVICES

The Company may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s expertise and experience with the Company are important.

There have been no amounts paid or payable to the auditors for non-audit services provided during the year.

The Directors have considered the position and are satisfied that the provision of any non-audit services (if necessary in future) is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001 . The Committee is satisfied that the provision of any non-audit services by the auditor, would not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:

All non-audit services would be reviewed by the Audit and Risk Committee to ensure they do not impact the impartiality and objectivity of the auditor; and
None of the services undermine the general principles relating to auditor independence as set out in APES 110, including reviewing or auditing the auditor’s own work, acting in a management or a decision-making capacity for the Company, acting as advocate for the Company or jointly sharing economic risk and rewards.

A copy of the Auditors’ Independence Declaration as required under section 307C of the Corporation Act 2001 is set out on page 13.

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Dr Emmanuel (Manny) C Pohl Executive Director, CEO

29 August 2016

Barrack St Investments Limited

AUDITOR’S INDEPENDENCE DECLARATION

AUDITORS INDEPEDENCE DECLARATION UNDER S 307C OF THE CORPORATIONS ACT 2001 TO THE DIRECTORS OF BARRACK ST INVESTMENTS LIMITED

I declare that, to the best of my knowledge and belief, during the year ended 30[th] June 2016 there have been no contraventions of:

(i) The auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii) Any applicable code of professional conduct in relation to the review.

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Leslie Pines Chartered Accountant

Sydney 29 August 2016

Barrack St Investments Limited

CORPORATE GOVERNANCE STATEMENT : FOR THE YEAR ENDED 30 June 2016

This statement outlines the main corporate governance practices that were in place for the year ended 30 June 2016. The statement explains the extent to which the Company complies with the ASX Corporate Governance Principles and Recommendations, including explanations of why certain recommendations have not been followed. For ease of comparison with the Principles and Recommendations, this section summarises the Company’s compliance with each of the specific recommendations as follows.

PRINCIPLE 1:

Lay solid foundations for management and oversight

Recommendation 1.1: Respective roles and responsibilities of its Board and Management

Compliant

The Board is responsible for the overall corporate governance of the entity and its overriding objective is to protect and increase Shareholder value. The Board guides and monitors the business to ensure that the Company is properly managed in the best interest of Shareholders. The Board is accountable to its Shareholders.

It is responsible for a broad range of matters including:

monitoring the Investment Manager and the composition and performance of the investment portfolio;
undertaking Director nomination matters including succession planning for the Board to ensure an appropriate mix of skills, experience, expertise and diversity is maintained;
approving and maintaining appropriate risk management and internal control systems to identify, assess, monitor and manage the Company’s business risks on an ongoing basis;
overseeing the Company’s process for disclosure and communications; and
developing and approving appropriate Company policies, procedures and codes of behaviour as required to maintain a culture of integrity and a strong framework of corporate governance.

The Board has adopted a formal Board Charter that details the Board’s role, authority, responsibilities, membership and operations, and is available on the Company’s website www.barrackst.com

The Charter sets out the matters specifically reserved for the Board and the powers delegated to its Committees.

Recommendation 1.2: Information prior to Director election/re-election

Compliant

Before the Board appoints a new Director or puts forward a candidate for election, the Board will ensure that appropriate background checks are undertaken. Shareholders are provided with all material information in our possession that is relevant to their decision on whether or not to elect or re-elect a Director through a number of channels, including via the Notice of Meeting, the Director Résumés and other information contained in the Annual Report.

Recommendation 1.3: Written agreement with each Director and senior executive setting out the terms of their appointment

Compliant

Upon appointment, each Director receives a letter of appointment which sets out the formal terms of their appointment, along with a deed of indemnity, insurance and access.

Recommendation 1.4: The Company Secretary of a listed entity should be accountable directly to the Board, through the Chair, on all matters to do with the proper functioning of the Board.

Compliant

The Company Secretary is employed by a third party as disclosed in the Directors’ Report and is directly accountable to the Board on matters relating to the proper functioning of the Board.

Details regarding the Company Secretary, including experience and qualifications, are set out in the Directors’ Report.

Recommendation 1.5: Gender Diversity

Not Compliant

In respect of diversity, the Board considers that diversity includes differences that relate to gender, age, ethnicity and cultural background. It also includes differences in background and life experience, communication styles, interpersonal skills, education and problem solving skills.

The Board seeks to develop a culture of diversity whereby a mix of skills and diverse backgrounds are employed by the Company at all levels, through structuring the recruitment processes at all levels, so that a diverse range of candidates are considered and there are no excuses or unconscious biases that might discriminate against certain candidates. However, as the Company is an externally managed entity, this recommendation is not applicable.

Recommendations 1.6 and 1.7: Board and Senior Executive Evaluation

Compliant

The Board is committed to formally evaluating its performance and the performance of the Audit and Risk Committee and individual Directors, as well as the governance processes supporting the Board. The Board does this through an annual assessment process. Any issues identified are addressed at subsequent Board meetings.

PRINCIPLE 2:

Structure the Board to add value

Recommendation 2.1: Establish a Nomination Committee

Not Compliant

The Company has not established a formal Nomination Committee, as the Board considers that, due to the scope and nature of the Company’s activities, the whole Board should undertake the responsibility.

Barrack St Investments Limited

Recommendation 2.2: Have and disclose a Board skills matrix

PRINCIPLE 3:

Act ethically and responsibly

Compliant

Our objective is to have an appropriate mix of expertise and experience on our Board and its Committees so that the Board can effectively discharge its corporate governance and oversight responsibilities. This mix is described in the Board skills matrix below.

Expertise	Experience
 Financial knowledge and experience  Legal, governance and compliance  Commercial acumen  Risk management	Industry Finance Superannuation Market Australian Listed Securities Geographic Australia

Recommendation 2.3: Independent Directors

Compliant

The Board has accepted that an Independent Director is as defined in Box 2.3 of the ASX Corporate Governance Principles and Recommendations (3rd Edition).

Of the current Board members, Mr Murray d’Almeida and David Crombie AM are considered to be independent Directors.

The length of service of each director is set out in the Directors Report.

Recommendation 2.4: A majority of the Board of a listed entity should be independent Directors

Compliant

The structure of the Board does comply with this recommendation in that a majority of the Directors are independent (refer recommendation 2.3)

Recommendation 2.5: The Chair of the Board of a listed entity should be an independent Director and, in particular, should not be the same person as the CEO of the entity.

Complaint

The Company’s Chairman is Mr Murray d’Almeida, an independent Director.

Recommendation 2.6: Director induction and professional development

Compliant

New Directors are inducted into the Company’s processes and policies in a suite of ways, including the provision of a ‘Board manual’, interviews with senior management of the Investment Manager and out of session meetings with other Directors. All Directors are encouraged to undertake ongoing professional development both in their area of technical expertise and in the skills required to effectively execute the role of Director.

Recommendation 3.1: Code of Conduct

Compliant

The Company has developed a Code of Conduct (the Code) which has been fully endorsed by the Board and applies to all Directors and officers. The Code is reviewed annually and updated as necessary to ensure it reflects the highest standards of behaviour and professionalism and the practices necessary to maintain confidence in the Company’s integrity. A summary of the Code is available on the Company’s website: www.barrackst.com

The Code sets out the Company’s commitment to conducting its business in accordance with all applicable laws and regulations while demonstrating and promoting the highest ethical standards.

PRINCIPLE 4: Safeguard integrity in corporate reporting

Recommendation 4.1: Audit Committee

Compliant

The Company has an Audit and Risk Committee which comprises three independent Directors.

The composition of the Committee, a record of its meetings, and the relevant experience of each member of the Committee is set out in the Directors Report.

The Audit and Risk Committee charter is available on the Company’s website: www.barrackst.com

Recommendation 4.2: CEO and CFO declaration on the financial records

Compliant

The Board has received a declaration from the CEO and CFO that the Company’s financial records have been properly maintained and that the financial statements comply with the appropriate accounting standards and give a true and fair view of the financial position and performance of the Company and that the opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.

A summary of the Code is available on the Company’s website: www.barrackst.com

Recommendation 4.3: The external auditor should attend the AGM and be available to answer questions from security holders relevant to the audit

Compliant

Leslie Pines, the Company’s auditor during the year, was available at the most recent AGM and will be available at the next AGM, to answer questions from Shareholders. It is the policy of the Board to always request auditor presence at AGMs.

Barrack St Investments Limited

CORPORATE GOVERNANCE STATEMENT : FOR THE YEAR ENDED 30 June 2016 (Continued)

PRINCIPLE 5: Make timely and balanced disclosure

Recommendation 5.1: Continuous Disclosure Policy

Compliant

The Company has a Continuous Disclosure Policy which sets out the obligations of the Company’s Directors and officers in relation to continuous disclosure as well as the Company’s obligations under the Corporations Act and the ASX Listing Rules. The policy also contains procedures for internal notification and external disclosure, as well as procedures for promoting understanding of compliance with the disclosure requirements and for the monitoring of Company compliance.

The Disclosure Policy is available on the Company’s website: www.barrackst.com

The Company provides a direct voting facility to allow security holders to vote ahead of AGMs without having to attend or appoint a proxy.

Recommendation 6.4: Give security holders the option to receive communications from, and send communications to, the entity and its security registry electronically

Compliant

Quarterly reports and other information required to be sent to Shareholders are sent by email to all persons who have requested their name to be added to the Company’s email list. If requested, the Company will provide general information by email, facsimile or post.

PRINCIPLE 7: Recognise and manage risk

PRINCIPLE 6: Respect the rights of security holders

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

Compliant

Investors and other stakeholders can find information about the Company on its website: www.barrackst.com

Information on the Company’s corporate governance practices can also be found at www.barrackst.com

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

Compliant

The Company’s Communications Policy sets out how the Company will communicate with Shareholders.

Information is communicated to Shareholders through the distribution of a quarterly report, annual and half yearly financial reports, announcements through the ASX and the media, on the Company’s website and through the Chairman’s address at the Annual General Meeting.

If requested, the Company will provide general information by email, facsimile or post.

Through the Company’s information email address and phone number, and at AGMs, the Company encourages two-way communication with Shareholders.

The Communication Policy is available on the Company’s website: www.barrackst.com

Recommendation 6.3: Disclose the policies and processes it has in place to facilitate and encourage participation at meetings of security holders

Compliant

The Company facilitates and encourages participation at meetings of security holders by having sections of each meeting dedicated to questions from the floor. Shareholders are given at least 30 days’ notice of security holder meetings and those that are unable to attend in person may email or fax questions they would like answered.

Recommendation 7.1: Risk Committee

Compliant

The Audit and Risk Committee monitors the Company’s business risks.

The composition of the Committee and a record of its meetings is set out in the Directors Report.

The Audit and Risk Committee charter is available on the Company’s website: www.barrackst.com

Recommendation 7.2: Annual risk management framework review

Compliant

Each year, the Audit and Risk Committee, reviews the Company’s risk management framework. Ad hoc reviews may also be conducted when the Board perceives that the risk environment has shifted significantly. A review was conducted during the year.

Recommendation 7.3: Internal audit function

Non-Compliant

The Company does not have an internal audit function as the Board has deemed it is not necessary giving consideration to the size and nature of the Company. Instead, the full Board through the Audit and Risk Committee liaises closely with the Company’s external auditor to identify potential improvements to the risk management and internal control processes.

Recommendation 7.4: Exposure to economic, environmental and social sustainability risks

Compliant

The Board monitors the business risk and guides the affairs of the Company in the discharge of its stewardship responsibilities.

The Board meeting agendas and reports advise the Board of current and forthcoming issues relevant to the Company’s operations and performance. The Board reviews the investment portfolio at their regular meetings.

Management has designed and implemented a risk management and internal control system through a Risk Management Framework. The Framework is monitored by the Audit & Risk Committee with regular reporting to Committee meetings. The Framework is reviewed yearly by the Committee.

Barrack St Investments Limited

The identified risks are grouped within the Framework under the following headings:

Strategic
Operational
External Macro
Environmental

PRINCIPLE 8: Remunerate fairly and responsibly

Recommendation 8.1: Remuneration Committee

Not Compliant

Given the size of the Company and the nature of its activities, these functions are undertaken by the Board.

Recommendation 8.2: Disclose its policies and practices regarding the remuneration of non-executive Directors and the remuneration of executive Directors and other senior executives

Compliant

The maximum amount of Directors’ fees is fixed by Shareholders at the Annual General Meeting and can only be varied by Shareholders in a similar manner. In determining the allocation of fees, the Board takes into account the time demands on each Director, together with the responsibilities undertaken by them and market practices of similar sized businesses in the Listed Investment Company sector.

It is the policy of the Board not to issue Directors incentive shares or options.

The details of the remuneration received by Directors in the 2015/2016 year are included in the Remuneration Report contained within the Directors’ Report.

Recommendation 8.3: Equity-based remuneration

Not Compliant

As the Company does not have an equity-based remuneration scheme, recommendation 8.3 is not applicable.

Barrack St Investments Limited

FINANCIAL REPORT

CONTENTS OF FINANCIAL REPORT

Page

Financial Report
Statement of Profit or Loss and Other Comprehensive Income	19
Statement of Financial Position	20
Statement of Changes in Equity	21
Statement of Cash Flows	22
Notes to the Financial Statements	23
Directors’ Declaration	35
Independent Auditor’s Report	36
Shareholder Information	37
Investments	38
Corporate Directory	39

This financial report covers Barrack St Investments Limited as an individual entity. There are no controlled entities.

Barrack St Investments Limited is a company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is:

Barrack St Investments Limited Suite 5 Level 3 Barrack House 16-20 Barrack Street SYDNEY NSW 2000

The financial report was authorised for issue by the Directors on 29 August 2016.

A description of the nature of the entity’s operations and its principal activities is included in the Operating and Financial Review.

Through the use of the internet, we have ensured that our corporate reporting is timely, complete and available globally at minimum cost to the Company. All media releases, financial reports and other information are available from the Company at the above address or from our website:

www.barrackst.com

Barrack St Investments Limited

BARRACK ST INVESTMENTS LIMITED

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 30 JUNE 2016

Notes	2016 2015 $ $
Revenue 5 Expenses 6 Realised gain on available sale of financial assets Profit/(loss) before income tax Income tax expense 7 Profit/(loss) after income tax Other Comprehensive Income, net of income tax Items that will not be reclassified subsequently to profit & loss Changes in fair value of Financial Assets at fair value through Other Comprehensive Income Income Tax (Expense)/Benefit relating to components of Other Comprehensive Income Items that will be reclassified to profit & loss when specific conditions are met Other Comprehensive Income for the year, net of tax Total Comprehensive Income for the year Earnings per share: Basic earnings per share 16 Diluted earnings per share 16 Total Comprehensive Income Basic and diluted earnings per share 16	452,492 408,172 (888,414) (524,269) 2,101,797 -
	1,665,875 (116,091) (418,831) 156,051
	1,247,044 39,960
	1,333,156 113,228 (480,089) (33,968)
	853,067 79,260
	2,100,111 119,220

	Cents Cents
	7.760 0.249 7.760 0.249 13.080 0.743

The accompanying notes form part of these financial statements.

Barrack St Investments Limited

FINANCIAL REPORT

BARRACK ST INVESTMENTS LIMITED

STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2016

Notes	2016 $	2015 $
ASSETS CURRENT ASSETS Cash and Cash Equivalents 8 Trade and Other Receivables 9 TOTAL CURRENT ASSETS NON CURRENT ASSETS Available-for-sale Financial Assets at fair value 10 Deferred tax assets 11 TOTAL NON-CURRENT ASSETS TOTAL ASSETS LIABILITIES CURRENT LIABILITIES Trade and Other Payables 12 Current tax liabilities TOTAL CURRENT LIABILITIES NON CURRENT LIABILITIES Deferred Tax Liability 11 TOTAL NON-CURRENT LIABILIITIES TOTAL LIABILITIES NET ASSETS EQUITY Issued Capital 13 Reserves Retained earnings TOTAL EQUITY	1,598,940 286,943	1,870,652 14,356
	1,885,883	1,885,008
	16,684,454 98,311	13,548,767 122,083
	16,782,765	13,670,850
	18,668,648	15,555,858
	467,145 193,784	10,000 -
	660,929	10,000
	409,482	-
	409,482	-
	1,070,411	10,000

	17,598,237	15,545,858
	15,699,716 852,185 1,046,336	15,506,779 (882) 39,961
	17,598,237	15,545,858

The accompanying notes form part of these financial statements.

Barrack St Investments Limited

BARRACK ST INVESTMENTS LIMITED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 JUNE 2016

2015 Note	Ordinary Shares Retained Earnings $ $	Asset Revaluation Reserve Total $ $
Balance at 1 July 2014 Profit for the year Other Comprehensive Income for the year Total Transactions with owners in their capacity as owners Shares issued during the year Capital raising costs Dividends paid or provided for 15 Balance at 30 June 2015	6,000 2 - 39,959 - -	- 6,002 39,959 79,260 79,260
	- 39,959 16,030,282 - (529,503) - - -	79,260 119,219 - - (80,142)
	15,506,779 39,961	(882) 15,545,858

2016 Note	Ordinary Shares Retained Earnings $ $	Asset Revaluation Reserve Total $ $
Balance at 1 July 2015 Profit for the year Other Comprehensive Income for the year Total Comprehensive Income for the year Transactions with owners in their capacity as owners Shares issued during the year Capital raising costs – Tax Effect Dividends paid or provided for 15 Balance at 30 June 2016	15,506,779 39,961 - 1,247,044 - -	(883) 15,545,858 - 1,247,044 853,067 853,067
	- 1,287,044 34,085 - 158,852 - - (240,669)	853,067 2,100,111 - 34,085 - 158,852 - (240,669)
	15,699,716 1,046,336	852,185 17,598,237

The accompanying notes form part of these financial statements.

Barrack St Investments Limited

FINANCIAL REPORT

BARRACK ST INVESTMENTS LIMITED STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 30 JUNE 2016

Notes	2016 $	2015 $
CASH FLOWS FROM OPERATING ACTIVITIES Dividends received Interest received Other Payments (inclusive of GST) Net cash provided by/(used in) operating activities 24 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of investments Payments for investments Net cash provided by/(used in) operating activities CASH FLOWS FROM FINANCING ACTIVITIES Shares issued for cash payments Capital raising costs Dividends paid Net cash used by financing activities Net increase/(decrease) in cash and cash equivalents held Cash and cash equivalents at the beginning of the year Cash and cash equivalents at end of year 8	445,848 6,645	380,021 28,151
	(509,923)	(358,213)
	(57,430)	49,959
	18,948,080 (18,953,778)	5,183,559 (18,783,877)
	(5,698)	(13,600,318)
	- - (208,584)	16,022,500 (529,503) (72,360)
	(208,584)	15,420,637
	(271,712) 1,870,652	1,870,277 375
	1,598,940	1,870,652

The accompanying notes form part of these financial statements.

Barrack St Investments Limited

BARRACK ST INVESTMENTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

The functional and presentation currency of Barrack St Investments Limited is Australian dollars.

1. BASIS OF PREPARATION

The financial statements are general purpose financial statements that have been prepared in accordance with the Australian Accounting Standards and the Corporations Act 2001 .

These financial statements and associated notes comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board.

The financial statements have been prepared on an accruals basis and are based on historical costs modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.

Significant accounting policies adopted in the preparation of these financial statements are presented below and are consistent with prior reporting periods unless otherwise stated.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and losses can be utilised.

Current and deferred tax is recognised as income or an expense and included in profit or loss for the period except where the tax arises from a transaction which is recognised in other comprehensive income or equity, in which case the tax is recognised in other comprehensive income or equity respectively.

(c) Goods and Services Tax (GST)

Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the amount of GST incurred is not recoverable from the Australian Taxation Office (ATO).

Receivables and payable are stated inclusive of GST.

(a) Revenue and Other Income

Revenue is recognised when the amount of the revenue can be measured reliably, it is probable that economic benefits associated with the transaction will flow to the Company and specific criteria relating to the type of revenue as noted below, has been satisfied.

Revenue is measured at the fair value of the consideration received or receivable and is presented net of returns, discounts and rebates.

All revenue is stated net of the amount of goods and services tax (GST).

Interest Revenue

Interest is recognised using the effective interest method

The net amount of GST recoverable from, or payable to, the ATO is included as part of receivables or payables in the statement of financial position.

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

(d) Cash and Cash Equivalents

Cash and cash equivalents comprises cash on hand, demand deposits and short-term investments which are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.

Dividend Revenue

Dividends are recognised when the entity’s right to receive payment is established.

(b) Income Tax

The income tax expense recognised in the statement of profit or loss and other comprehensive income comprises of current income tax expense plus deferred tax expense.

Current tax is the amount of income taxes payable (recoverable) in respect of the taxable profit (loss) for the year and is measured at the amount expected to be paid to (recovered from) the taxation authorities, using the tax rates and laws that have been enacted or substantively enacted by the end of the reporting period. Current tax liabilities (assets) are measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.

(e) Financial Instruments

Financial Assets At Fair Value Through Profit Or Loss

Financial assets at fair value through Profit or Loss are Financial Instruments convertible in to Equity Instruments. A financial asset is classified in this category if it is so designated by management and within the requirement of AASB 9 Financial Instruments. Realised and unrealised gains and losses arising from changes in the fair value of these assets are included in the profit or loss in the period in which they arise.

Barrack St Investments Limited

FINANCIAL REPORT

BARRACK ST INVESTMENTS LIMITED NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

(e) Financial Instruments (continued)

Financial Assets At Fair Value Through Other Comprehensive Income

The Company is a long-term investor in equity instruments. Under AASB 9, these investments are classified as fair value through Other Comprehensive Income. After initial recognition at fair value (being cost), the Company has elected to present in Other Comprehensive Income changes in fair value of equity instruments investments.

Unrealised gains and losses on investments are recognised in the Asset Revaluation Reserve until the investment is sold or otherwise disposed of, at which time the cumulative gain or loss is transferred to the Asset Realisation Reserve.

The Company derecognises an investment when it is sold or it transfers the investment and the transfer qualifies for derecognition in accordance with AASB 9. Upon derecognition, unrealised gains/losses net of tax relating to the investment are transferred from the revaluation reserve to the realisation reserve.

Available-For-Sale Financial Assets

These investments are measured at fair value.

Unrealised gains and losses arising from changes in the fair value of these assets are taken directly to Other Comprehensive Income and accumulated in Equity.

When these financial Assets are sold, the accumulated fair value adjustments are reclassified from Equity to the profit or loss as gains and losses on sale.

Available-For-Sale Financial assets are assessed at each reporting date to determine whether there is an objective evidence that it is impaired. In the case of Available-For-Sale Financial Instruments, a significant or prolonged decline in the value of the instruments below cost is considered to be evidence of whether or not impairment has arisen.

Any cumulative impairment loss in respect of an Available-For-Sale Financial Asset previously recognised in equity is reclassified to profit or loss.

Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired.

The amount of the provision is the different 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 provision is recognised in the profit or loss in other expenses.

Fair Value Estimation

The fair value of financial instruments traded in active markets (such as publicly traded derivatives and securities) is based on quoted market prices at the Statement of Financial Position date. The quoted market price used for financial assets held by the Company is the current bid price. The appropriate quoted market price for financial liabilities is the current bid price.

The nominal value less estimated credit adjustments of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Company for similar financial instruments.

(f) Trade And Other Payables

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

(g) Provisions

Provisions are recognised when the Company has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.

Provisions for Dividends

An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was recognised. For Available-For-Sale Financial Assets that are debt securities, the reversal is recognised in profit or loss. For equity securities, the reversal is recognised in Other Comprehensive Income.

Loans and Receivables

Loans and receivables are recognised initially at fair value and subsequently measured at amortised cost, less provision for doubtful debts. Trades receivables are due for settlement no more than 30 days from the date of recognition.

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

(h) Share Capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and share options which vest immediately are recognised as a deduction from equity, net of any tax effects

Collectability of loans and receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off. A provision for impairment of trade receivables is established when there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of the receivables.

Barrack St Investments Limited

BARRACK ST INVESTMENTS LIMITED NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

(i) New Accounting Standards and Interpretations

The AASB has issued new and amended Accounting Standards and Interpretations that have mandatory application dates for future reporting periods. The Company has decided not to early adopt these Standards. The following table summarises those future requirements and their impact on the Company where the standard is relevant:

AASB 9 Financial Instruments and amending standards AASB 2010-7 / AASB 2012-6

Interpretations that have mandatory application dates for future reporting periods. The Company has decided not to early adopt these Standards. The following table summarises those future requirements and their impact on the Company where the standard is relevant:	Interpretations that have mandatory application dates for future reporting periods. The Company has decided not to early adopt these Standards. The following table summarises those future requirements and their impact on the Company where the standard is relevant:	Interpretations that have mandatory application dates for future reporting periods. The Company has decided not to early adopt these Standards. The following table summarises those future requirements and their impact on the Company where the standard is relevant:
AASB 9 Financial Instruments and amending standards AASB 2010-7 / AASB 2012-6
	Effective Date 31 July 2016	Changes to the classification and measurement requirements for financial assets and financial liabilities
		The impact of AASB 9 did not have a material impact on the Company

4. OPERATING SEGMENTS

Segment Information

The Company operates in the investment industry. Its core business focuses on investing in Australian equities to achieve medium to long-term capital growth and income.

Operating segments have been determined on the basis of reports reviewed by the CEO. The CEO is considered to be the chief operating decision maker of the Company. The CEO considers the business from both a product and geographic perspective and assesses performance and allocates resources on this basis. The CEO considers the business to consist of just one reportable segment.

3. CRITICAL ACCOUNTING ESTIMATES AND

JUDGEMENTS

(a) Key Estimates

There are no key assumptions or sources of estimation uncertainty that have a risk of causing material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period as investments are carried at their market value.

(b) Key Judgements

The preparation of financial reports in conformity with Australian Account Standards require the use of certain critical accounting estimates. This requires the Board to exercise their judgement in the process of applying the Company's accounting policies.

The carrying amount of certain assets and liabilities are often determined based on estimates and assumptions of future events. In accordance with AASB 112 Income Taxes, deferred tax liabilities and deferred tax assets have been recognised for Capital Gains Tax (CGT) on the unrealised gains/losses in the investment portfolio at current tax rates.

As the Directors do not intend to dispose of the portfolio, the tax liability/benefit may not be crystallised at the amount disclosed in Note: 11. In addition, the tax liability/benefit that arises on the disposal of these securities may be impacted by changes in tax legislation relating to treatment of capital gains and the rate of taxation applicable to such gains/losses at the time of disposal.

The Company has an investment process which is anticipated will deliver medium to long-term capital growth - minimum investment period is three to five years.

The deferred tax asset has been carried forward as it believed that this process will deliver growth over this period to utilise the deferred tax asset.

The Company does not hold any securities for short term trading purposes. Therefore the investment portfolio is classified as Financial Assets at fair value through Other Comprehensive Income.

Barrack St Investments Limited

FINANCIAL REPORT

BARRACK ST INVESTMENTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

Notes	2016 $	2015 $
5. REVENUE AND OTHER INCOME Interest Received Dividends Received 6. OTHER EXPENSES ASX listing and other fees Audit fees Directors fees Insurance Share registry Other 7. INCOME TAX EXPENSE (a) The major components of tax expense (income) comprise: Current tax expenses Income tax expense: Income tax expense for continuing operations (b) Reconciliation of income tax to accounting profit Profit before income tax Prima facie tax payable on profit from ordinary activities before income tax rate at 30% (2015 - 30%) Add: Tax effect of: - Franking Credits - Prior year adjustment - Other items Less - Rebateable fully franked dividends Income tax expense/(income) (c) Amounts recognised directly in Other Comprehensive Income	6,644 445,848	28,151 380,021
	452,492	408,172
	33,121 12,131 128,125 14,664 16,712 683,661	11,133 12,050 128,125 15,000 15,657 342,299
	888,414	524,264
	418,831	(156,051)
	418,831	(156,051)
	1,665,875 499,762 49,047 31,770 1,742 (163,490)	116,092 (34,827) - - - (121,224)
	418,831	(156,051)
	480,088	33,968

Barrack St Investments Limited

BARRACK ST INVESTMENTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

	2016 2015 $ $
8. CASH AND CASH EQUIVALENTS Cash at bank and on hand Reconciliation of cash Cash and Cash Equivalents reported in the Statement of Cash Flows are reconciled to the equivalent items in the Statement of Financial Position as follows: Cash at bank and on hand Balance as per Statement of Cash Flows 9. TRADE AND OTHER RECEIVABLES CURRENT Trade receivables GST receivable Establishment costs Dividends receivable Total current trade and other receivables 10. FINANCIAL ASSETS Available for sale Financial Assets Total Financial Assets (a) For listed equity securities, fair value is determined by reference to closing bid prices on the Australian Securities Exchange. Opening balance at 1 July Additions (at cost) net of disposals (at fair value) Revaluation Closing balance at 30 June 11. TAX ASSETS AND LIABILITIES Recognised deferred tax assets Deferred tax assets (a) Reconciliations Gross Movements. The overall movement in deferred tax asset accounts is as follows: Opening balance Credited/charged to the Income Statement Credited/charged to Other Comprehensive Income Closing balance Comprises - Tax losses - Capital raising costs Deferred tax liability Deferred tax liabilit arises from tax on unrealised ains	1,598,940 1,870,652
	1,598,940 1,870,652
	1,598,940 1,870,652
	1,598,940 1,870,652
	210,384 - 37,657 9,240 5,116 5,116 31,786 -
	286,943 14,356
	16,684,454 13,548,767
	16,684,454 13,548,767
	13,548,767 - 1,802,531 13,469,507 1,333,156 79,260
	16,684,454 13,548,767
	98,311 122,083
	122,083 - (23,772) 156,051 - (33,968)
	98,311 122,083
	- 122,083 98,311 - 409,482 -

Deferred tax liability arises from tax on unrealised gains.

Barrack St Investments Limited

FINANCIAL REPORT

BARRACK ST INVESTMENTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

	2016 2015 $ $
12. TRADE AND OTHER PAYABLES CURRENT Accounts payable and accrued expenses Contractual cash flows from trade and other payable approximate their carrying amount. Trade and other payables are all contractually due within six months of reporting date. 13. ISSUED CAPITAL	467,145 10,000
	467,145 10,000

ISSUED CAPITAL
(a) Share Capital Ordinary shares Fully Paid 16,069,468 (2015: 16,037,789) Capital raising costs Total (b) Movements in ordinary share capital	16,070,368 16,036,282 (370,652) (529,503)
	15,699,716 15,506,779

Date Details	Number of shares	Price	$
30 June 2014 Balance 14 August 2014 Issue of Shares under IPO 14 August 2014 Capital Raising Costs 14 April 2015 Issue of Shares under DRP 30 June 2015 Balance 9 October 2015 Issue of Shares under IPO 10 April 2016 Issue of Shares under DRP 15 June 2016 Options Exercised 30 June 2016 Capital Raising Cost – Tax Effect 30 June 2016 Balance Capital Raising costs Capital Raising costs – Tax Effect Net Capital Raising Costs (after tax)	6,000		6,000
	16,022,500 9,289	$1.00 $0.8378	16,022,500 (529,503) 7,782
	16,037,789 10,254 19,425 2,000	$1.0153 $1.1158	15,506,779 10,411 21,674 2,000 158,852
	16,069,468		15,699,716
			$
			529,503 (158,852)
			370,652

(c) Options

When the Company was listed, Shareholders were issued with one Option for every one share issued. The Options expired on 17 August 2016, at which date 2,222,000 had been exercised.

Barrack St Investments Limited

BARRACK ST INVESTMENTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

2016	2015
$	$

14. RESERVES (a) Asset Revaluation Reserve The asset revaluation reserve records fair value movements of long-term investments after provision for deferred tax. 15. DIVIDENDS ( a) Dividends and distributions paid

The following dividends were declared and paid: Final fully franked ordinary dividend of 0.5 cents per share paid on 9 October 2015 80,189 - Interim fully franked ordinary dividend of 1.0 cents (2015: 0.5 cents) per share paid on 1 April 2016 (2015 – 10 April 2015) 160,480 80,143 Total 240,669 80,143 Dividends paid in cash or satisfied by the issue of shares under the dividend reinvestment plan during the year ended 30 June 2016 and 2015 were are follows Paid in cash 208,584 72,361 Satisfied by issue of shares 32,085 7,782 Total 240,669 80,143 (b) Proposed Dividends Proposed final 2016 fully franked ordinary dividend of 1.5 cents (2015: 0.5cents) per share to be paid on 23 September 2016. 274,342 80,189 The proposed final dividend for 2016 was declared after the end of the reporting period and therefore has not been provided for in the financial statements. There are no income tax consequences arising from this dividend at 30 June 2016. (c) Franked dividends The franking credits available for subsequent financial years at a tax rate of 30% The above available balance is based on the dividend franking account at year-end adjusted for: (a) Franking credits that will arise from the payment of the current tax liabilities; (b) Franking debits that will arise from the payment of dividends recognised as a liability at the year end; (c) Franking credits that will arise from the receipt of dividends recognised as receivables at the end of the year. The impact on the franking credit of the dividends proposed after the end of the reporting period is to reduce it by $117,575 (2015: $89,122).

The ability to use the franking credits is dependent upon the Company's future ability to declare dividends.

Barrack St Investments Limited

FINANCIAL REPORT

BARRACK ST INVESTMENTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

		2016 2015 $ $
15. DIVIDENDS (continued) (d) Listed Investment Company capital gain account (before tax) Balance of the Listed Investment Company (LIC) capital gain account as at 30 June 2016 Distributed capital gains may entitle certain Shareholders to a special deduction in their Tax Return as set out in the dividend statement. LIC capital gains available for distribution are dependent on: (i) the disposal of investment portfolio holdings which qualify for LIC capital gains; or (ii) the receipt of LIC distribution from LIC securities held in the portfolio. 16. EARNINGS PER SHARE (a) Earnings used in the calculation of basic and diluted earnings per share. (i) Profit/(loss) from continuing operations attributable to the owners of the Company (ii) Total Comprehensive Income (b) Basic and Diluted earnings per share (i) Profit/(loss) from continuing operations attributable to the owners of the Company (ii) Total Comprehensive Income (c) Weighted average number of ordinary shares used in the calculation of earnings per share Total Comprehensive Income is a more appropriate base for determining earnings per share as it includes profit after income tax and changes in fair value of financial assets 17. AUDITORS REMUNERATION Remuneration of the auditor of the Company for: Audit or reviewing the financial statements Total remuneration of auditors		1,843,940 -
		1,247,044 39,960 2,100,111 119,220
		Cents Cents 7.760 0.249 13.081 0.743
		16,053,628 16,037,789
		12,131 12,050
		12,131 12,050

Barrack St Investments Limited

BARRACK ST INVESTMENTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

18. FINANCIAL RISK MANAGEMENT

The Company is exposed to a variety of financial risks through its use of financial instruments.

The Company's overall risk management plan seeks to minimise potential adverse effects due to the unpredictability of financial markets. The Company does not speculate in financial assets.

The Company's overall risk management program focuses on the volatility of the financial markets and seeks to minimise potential adverse effects on the financial performance of the Company. Risk governance is managed through the Board which provides direct oversight on the Company’s risk management framework and overall risk management performance.

The Board provides written principles for risk management covering investment portfolio composition. Risk is managed by the professional, disciplined management of the investment portfolio by EC Pohl & Co Pty Ltd (the Manager).

The Company held the following financial instruments:

	2016 $	2015 $
Financial Assets Cash and cash equivalents Receivables Financial Assets at fair value through Other Comprehensive Income. Total Financial Assets Financial Liabilities Trade and Other Payables Total Financial Liabilities	1,598,940 286,943 16,684,454	1,870,652 14,356 13,548,767
	18,570,337	15,433,775
	467,145 467,145	10,000 10,000

(a) Market Risk

Foreign exchange risk

The C ompany operates entirely within Australia and is not exposed to material foreign exchange risk.

Equity market risk

The Company is exposed to risk of market price movement through its investments in Australian listed equity securities. Equity investments held by the Company are classified on the Statement of Financial Position as Financial Assets at fair value through Other Comprehensive Income and any movement in the listed equity securities is reflected in Other Comprehensive Income.

The risk to Shareholders is that adverse equity securities market movements have the potential to cause losses in Company earnings or the value of its holdings of financial instruments. The Manager’s investment strategy centres on the view that investing in proven high quality businesses with growth opportunities arising from their sustainable competitive advantage will outperform over the longerterm. Consistent with this approach, the Manager has an established risk management framework that includes procedures, policies and functions to ensure constant monitoring of the quality of the investee companies. The objective of the risk management framework is to manage and control risk exposures within acceptable parameters while optimising returns.

Equity market risk is measured as a percentage change in the value of equity instruments held in the portfolio, as compared to the total market index for the same period.

At 30 June 2016, the effect of profit and equity as a result of changes in the interest rate, with all other variables remaining constant, would be as follows:

constant, would be as follows:
	2016
Portfolio five year return	17%
All Ordinaries Index five year return	3%

(b) Sensitivity Analysis

Increases/decreases in an equity securities price, affect the Company’s asset revaluation reserve and Other Comprehensive Income for the year. The analysis is based on the assumption that the Financial Assets at fair value through Other Comprehensive Income had increased/decreased by 5% (2015 - 5%) with all other variables held constant.

Impact on Equity and Other Comprehensive Income for the year:2016 +/- $834,222 2015 +/- $677,438 Impact on profit or loss is nil.

(c) Cash Flow Interest Rate Risk

The Company is exposed to cash flow interest rate risk from holding cash and cash equivalents at variable rates. The objective of the Company is to minimise the potential adverse effects of interest rate risk.

In order to minimise the potential adverse effects of this risk, the Manager reviews the interest rate exposure as part of cash flow management and takes into consideration liquidity and yields as part of cash flow management. The cash and cash equivalents held are subject to an insignificant level of risk of changes in value.

As at the reporting date, the Company had the following cash and cash equivalents:

30 June 2016: Balance $1,598,940 Weighted average interest rate 0.42%

30 June 2015: Balance $1,870,652 Weighted average interest rate 1.5%

(d) Relative Performance Risk

The Manager aims to outperform the risk free cash rate over the long-term. However, as the portfolio consists of equity investments these will tend to be more volatile than cash, so there will likely be periods of relative under and over performance compared to the benchmark risk free rate.

Over the long-term the Manager is confident that the portfolio can achieve outperformance through an investment selection process that invests in companies that have a sound business model, display a sustainable competitive advantage and have proven quality management.

Barrack St Investments Limited

FINANCIAL REPORT

BARRACK ST INVESTMENTS LIMITED NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

(e) Credit Risk

Credit risk is the risk of a counterparty defaulting on their financial obligations resulting in a loss to the Company. The objective of the Company is to minimise credit risk exposure. Credit risk arises from cash and cash equivalents and Financial Assets at fair value through Other Comprehensive Income. Credit risk is managed by the Manager.

Credit risk arising from cash and cash equivalents is managed by only transacting with counterparties independently rated with a minimum rating of A. The providers of financial services to the Company are rated as AA by Standard and Poor’s. Credit risk on cash and cash equivalents is deemed to be low.

Credit risk arising from Financial Assets at fair value through Other Comprehensive Income relates to the risk of counterparties on the ASX defaulting on their financial obligations on transactions for Australian listed equity securities. The credit risk for these transactions is deemed to be low.

The maximum credit risk exposure of the Company at year end is the carrying value of the assets in the Statement of Financial Position.

There is no concentration of credit risk with respect to financial assets in the Statement of Financial Position.

(f) Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due.

The objective of the Company is to ensure as far as possible that it will always have sufficient liquidity to meet its liabilities when due, under both normal and distressed conditions.

Prudent liquidity risk management implies maintaining sufficient cash and marketable Australian listed equity securities.

The Manager controls liquidity risk by continuously monitoring the balance between equity securities and cash or cash equivalents and the maturity profiles of assets and liabilities to ensure this risk is minimal.

19. CAPITAL MANAGEMENT

The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The capital structure of the Company consists of equity attributable to members of the Company. The Board monitors the return on capital, which is defined as net operating income divided by total Shareholders’ Equity. The Board also monitors the level of dividends to Shareholders.

The capital of the Company is invested by the Investment Manager in accordance with the investment policy established by the Board. The Company has no borrowings. It is not subject to any externally imposed capital requirements.

There were no changes in the Company’s approach to capital management during the year.

20. FAIR VALUE MEASUREMENTS

The Company measures the following assets and liabilities at fair value on a recurring basis:

Financial Assets at fair value through Other Comprehensive Income.
Financial Assets At fair value through Profit or Loss.
Available-for-sale Financial Assets.

Fair value hierarchy

AASB 13 Fair Value Measurement requires all assets and liabilities measured at fair value to be assigned to a level in the fair value hierarchy as follows:

Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities that the entity can access at the measurement date.
Level 2 Inputs other than quoted prices included with level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3 Unobservable inputs for the asset or liability.

The table below shows the assigned level for each asset and liability held at fair value by the Company:

	Level	Level	Level	TOTAL
	1	2	3
30 June 2016	$	$	$	$
Recurring fair value
measurements.
Financial Assets
-Listed Equity
Securities	16,684,454			16,684,454
	Level	Level	Level	TOTAL
	1	2	3
30 June 2015	$	$	$	$
Recurring fair value
measurements.
Financial Assets
-Listed Equity
Securities	13,548,767			13,548,767

Transfers between levels of hierarchy

There were no transfers between levels of the fair value hierarchy.

Highest and best use

The current use of each asset measured at fair value is considered to be its highest and best use.

Barrack St Investments Limited

BARRACK ST INVESTMENTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2016	NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2016	NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2016
2016 2015 $ $
21. RELATED PARTY TRANSACTIONS Transactions with related parties Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated. The following transactions occurred with other related parties:  Dr E C Pohl has an interest in the transaction as during the year Dr E C Pohl was a Director, employee and Shareholder of EC Pohl & Co Pty Ltd, the holding company of ECP Asset Management Pty Ltd, the Manager
- A Performance Fee was payable in accordance with the Management Services Agreement as detailed in Note 22. 425,864 - - A Management Fee of 1% per annum is paid as detailed in Note 22. 183,185 126,444  B Jones (Company Secretary) partner of Rothsay Chartered Accountants, is paid for services as CFO and Company Secretary. 36,900 35,362

All related party transactions are made on an arm’s length basis using the standard terms and conditions.

22. MANAGEMENT SERVICES AGREEMENT

In accordance with a Management Services Agreement approved by Shareholders in 2014, the terms of which were contained in the prospectus, the Company agreed to engage the Manager to provide primary and secondary management services, including:

1) managing the investment of the Company’s portfolio, including keeping it under review;
2) ensuring investments by the Company are only made in authorised investments;
3) complying with the investment policy of the Company;
4) identifying, evaluating and implementing the acquisition and disposal of authorised investments;
5) provide the Company with monthly investment performance reporting;
6) manage the Company’s public and regulatory announcements and notices;
7) promoting investment in the Company by the general investment community;
8) providing investor relationship services; and
9) provision of accounting, human resources, corporate and information technology services support.

The agreement may be terminated if:

a) either party ceases to carry on business, or
b) either party enters into liquidation voluntarily or otherwise, or
c) either party passes any resolution for voluntary winding-up, or
d) a receiver of the property of either party, or any part thereof, is appointed, or
e) the Shareholders of the Company at an abnormal meeting called in for that purpose, resolve by binding resolution to terminate the operations, or
f) if the Company provides written notes to the Manager in the event of any material and substantial breach of the agreement by the Manager or if the Manager fails to remedy a breach of this agreement within 14 days following written notice of the breach.
g) if the Manager provides written notice to the Company in the event of any material and substantial breach of the agreement by the Company or if the Company fails to remedy a breach of this agreement within 14 days following written notice of the breach.
h) In recognition of the roles and personal expertise of senior executives retained by the Manager for the purpose of providing the primary services described in clause 3 of the Agreement, the parties agree that the agreement may be terminated, at the option of the Company, if there are major changes to senior executives (or their roles) providing the primary services. The Company shall be entitled to give the Manager a written termination notice upon or after the occurrence of a major change of the kind mentioned and such notice, if given, shall be effective at the end of the calendar month next following the giving of such notice unless the Company and the Manager mutually agree upon another date at which this agreement will terminate.

Under the agreement the Manager will receive a management fee of 1% per annum on the net tangible assets of the Company. In addition, a performance fee, payable annually in arrears, equal to 20% of the amount by which the Company’s net performance before tax (that is, after all costs and outlays but before the calculation of the performance fee) exceeds the Benchmark of 8% subject to a high water mark. If the Company’s net performance in the year is less than the Benchmark, then no performance fee will be payable.

Barrack St Investments Limited

FINANCIAL REPORT

BARRACK ST INVESTMENTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2016

2016	2015
$	$

23. KEY MANAGEMENT PERSONNEL DISCLOSURES

(a) Other Key Management Personnel The Company’s Secretary and Chief Financial Officer (Brian Jones) is a partner of Rothsay Chartered Accountants. Brian has not received any form of direct remuneration from the Company. Brian Jones (as Company Secretary and partner of Rothsay Chartered Accountants) is remunerated by EC Pohl & Co Pty Ltd for the provision of these services. The Company has no other staff and therefore has no Key Management Personnel other than the Directors.

No member of Key Management Personnel held options over shares in the Company during the year. There have been no other transactions with Key Management Personnel or their related entities other than those disclosed in Note 22.

The totals of remuneration paid to the key management personnel of Barrack St Investments Limited during the year are as follows: Short-term Employment benefits 128,125 128,125 Detailed remuneration disclosures are provided in sections (A) – (F) of the remuneration report on pages 11 and 12.

24. CASH FLOW INFORMATION

Reconciliation of result for the year to cash flows from operating activities

Reconciliation of net income to net cash provided by operating activities:

Profit for the year Cash flows excluded from profit attributable to operating activities Non-cash flows in profit: - realised gain on sale of financial assets Changes in assets and liabilities, net of the effects of purchase and disposal of subsidiaries - (increase)/decrease in trade and other receivables - increase /(decrease) in trade and other payables Cash flow from operations	1,247,044 39,958 (2,101,797)
	(854,753) (272,587) - 1,069,910 10,000
	(57,430) 49,958

25. CONTINGENCIES

In the opinion of the Directors, the Company did not have any contingencies at 30 June 2016 (30 June 2015: None).

26. EVENTS OCCURRING AFTER THE REPORTING DATE

Other than the exercise of Options, which expire on 17 August 2016, no matters or circumstances have arisen since the end of the financial year which significantly affected or may significantly affect the operations of the Company, the results of those operations, or the state of affairs of the Company in future financial years.

Barrack St Investments Limited

DIRECTORS’ DECLARATION

The Directors of the Company declare that:

(a) the Financial Statements and Notes set out on pages 18 to 34 are in accordance with the Corporations Act 2001 , including:
(i) complying with Accounting Standards, which, as stated in accounting policy Note 1 to the financial statements, constitutes compliance with International Financial Reporting Standards (IFRS); and
(ii) give a true and fair view of the financial position as at 30 June 2016 and of the performance for the year ended on that date; and

in the Directors’ opinion,

(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; and
(c) the remuneration disclosures set out on pages 11 and 12 of the Directors’ Report (as part of the audited remuneration report) for the year ended 30 June 2016 comply with section 300A of the Corporations Act 2001 .

The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by section 295A of the Corporations Act 2001 .

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

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Dr Emmanuel (Manny) C Pohl Executive Director, CEO

29 August 2016

Barrack St Investments Limited

INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF BARRACK ST INVESTMENTS LIMITED

Report on the Financial Report

I have audited the accompanying financial report of Barrack St Investments Limited, which comprises the statement of financial position as at 30 June 2016, the statement of profit or loss and other comprehensive income, the statement of changes in equity and 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.

Directors’ Responsibility for the Financial Report

The Directors of the company are responsible for the preparation and fair presentation of the financial report 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 and fair presentation of a financial report that is free from material misstatement, whether due to fraud or error. In Note 1, the Directors also state, in accordance with Australian Accounting Standard AASB 101 Presentation of Financial Statements , that the financial statements comply with International Financial Reporting Standards.

Auditor’s Responsibility

My responsibility is to express an opinion on the financial report based on my audit. I conducted my audit in accordance with Australian Auditing Standards. Those standards require that I 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 judgment, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error.

In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial report.

Independence

In conducting my audit, I have complied with the independence requirement of the Corporations Act 2001.

Opinion

In my opinion:

(a) The financial report of Barrack St Investments Limited is in accordance with the Corporations Act 2001 , including:

giving a true and fair view of the financial position as at 30 June 2016, and of its financial performance for the year ended on that date.

Complying with Australian Accounting Standards (including the Australian Accounting Interpretations), the Corporations Regulations 2001.

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

Report on the Remuneration Report

I have audited the remunerations report included on pages 11 of the Directors’ Report for the year ended 30[th] June 2016. The Directors of the company are responsible for the preparation and presentation of the remuneration report in accordance with section 300A of the Corporations Act 2001 . My responsibility is to express an opinion on the remuneration report, based on my audit conducted in accordance with Australian Auditing Standards.

Auditor’s Opinion

In my opinion, the remuneration report of Barrack St Investments Limited for the year ended 30 June 2016 complies with section 300A of the Corporations Act 2001 .

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Leslie Pines

Sydney 29 August 2016

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

Leslie Pines Suite 1, 102 Spofforth Street, Cremorne NSW 2090 email: [email protected]

Barrack St Investments Limited

SHAREHOLDER INFORMATION

The Shareholder information set out below was applicable as at 31 July 2016.

1. DISTRIBUTION OF SECURITIES:

Fully Paid Ordinary Shares

Distributions	Number of Shareholders

1 to 1,000	3,955
1,001 to 5,000	242,358
5,001 to 10,000	564,152
10,001 to 100,000	6,101,385
100,001 and over	9,217,618
Total	16,129,468

Holdings of less than a marketable parcel	2

Listed Options $1.00 Expiry date 17 August 2016

Distributions	Number of Options

1 to 1,000	6,000
1,001 to 5,000	299,500
5,001 to 10,000	552,000
10,001 to 100,000	6,584,100
100,001 and over	8,518,900
Total	15,960,500

As at 17 August 2017 2,222,000 Options had been exercised, the balance of the Options lapsed.

2. SUBSTANTIAL SHAREHOLDINGS

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

Substantial Shareholder	Number of Shares	% of Total


Dr E C Pohl*	4,823,716	30.13

Has the power to control voting and/or the disposal of securities in accordance with a Power Of Attorney in relation to 4,823,716 shares.

3. VOTING RIGHTS

On a show of hands every Shareholder present in person or by proxy shall have one vote and upon a poll each share shall have one vote.

4. TWENTY LARGEST SHAREHOLDERS

Shareholders	Ordinary Shares	%

CITICORP NOMINEES PTY LIMITED	4,870,716	30.20%
LIC INVESTMENTS PTY LTD
	510,000	3.16%
BRISAN PROJECTS PTY LTD	500,000	3.10%
MR CHRISTOPHER ANDREW BEARD
	465,072	2.88%
MR JOHN STEVEN PAGE & MRS GILLIAN KAY PAGE
	449,795	2.79%
MR CHRISTOPHER ANDREW BEARD & MRS MICHELLE MARGARET BEARD
	254,987	1.58%
DAVNAT SUPER FUND	253,990	1.57%
MS JULIE HELEN CRANSHAW & MRS MARIE HELEN TURNER
	222,000	1.38%
ROMADAK PTY LTD	152,993	0.95%
MR CORNELIUS LAUBIUS VISSER LAUBSCHER
	150,654	0.93%
GARRY JOHN FIRTH & GRETTA LORRAINE FIRTH
	150,000	0.93%
KAMILAROI INVESTMENTS PTY LTD
	150,000	0.93%
DE LEEUW HOLDINGS PTY LTD
	150,000	0.93%
MAURBRU SUPER PTY LTD
	150,000	0.93%
B SMARTYPANTS PTY LTD
	150,000	0.93%
LOTUS RESEARCH PTY LTD	117,984	0.73%
MR GUILLAUME JOHANNES SWIEGERS	110,113	0.68%
AURELIAN PASTORAL COMPANY PTY LTD
	105,636	0.65%
BOND STREET CUSTODIANS LIMITED
	101,391	0.63%
BOND STREET CUSTODIANS LIMITED
	101,391	0.63%
Total	9,116,722	56.52%

Barrack St Investments Limited

INVESTMENTS

(1) HOLDINGS OF SECURITIES AS AT 30 JUNE 2016

Individual investments at 30 June 2016 are listed below. The list should not, however, be used to evaluate portfolio performance or to determine the net asset backing per share at other dates. Individual holdings in the portfolio may change during the course of the year.

Company		Shares	Market Value $	%

	ORDINARY SHARES
ACX	Aconex Limited	221,210	1,550,682.10	8.48
AUB	AUB Group Limited	31,949	322,684.90	1.76
BBN	Baby Bunting Group Limited	96,129	230,709.60	1.26
BLA	Blue Sky Alternative Investments Limited	23,867	193,322.70	1.06
BTT	BT Investment Management Limited	193,143	1,521,966.84	8.32
CAR	Carsales.Com Limited	106,129	1,307,509.28	7.15
CAT	Catapult Group International Ltd	232,618	716,463.44	3.92
CVO	Cover-More Group Limited	546,274	660,991.54	3.62
DMP	Domino’s Pizza Enterprises Limited	2,727	185,790.51	1.02
IPH	IPH Limited	325,696	2,090,968.32	11.44
MFG	Magellan Financial Group Limited	66,760	1,485,410.00	8.12
PSQ	Pacific Smiles Group Limited	270,136	564,584.24	3.09
PWH	PWR Holdings Limited	65,697	182,637.66	1.00
REA	REA Group Ltd	23,363	1,389,864.87	7.60
RWC	Reliance Worldwide Corporation Limited	259,813	802,822.17	4.39
SIV	Silver Chef Limited	44,870	481,006.40	2.63
SRX	Sirtex Medical Limited	53,992	1,380,575.44	7.55
TME	Trade Me Group Limited	365,716	1,616,464.72	8.84
			16,684,454.73	91.25

	CASH

	Cash		1,598,940.00	8.75
	TOTAL		18,283,394.73	100.0

(2) TRANSACTIONS AND BROKERAGE

There were 135 (2015: 40) transactions in securities during the year on which brokerage of $109,651 (2015: $41,710) was paid.

Barrack St Investments Limited

CORPORATE DIRECTORY

BARRACK ST INVESTMENTS LIMITED ACN 167 689 821 REGISTERED IN QUEENSLAND ON 23 JANUARY 2014.

BOARD OF DIRECTORS

Murray H. d’Almeida Non-Executive Chairman David C. Crombie AM Non-Executive Director

Dr Emmanuel (Manny) C. Pohl Executive Director, CEO Jared D. Pohl Alternate Director

COMPANY SECRETARY

Brian E Jones Rothsay Chartered Accountants Level 1, 12 O’Connell Street SYDNEY NSW 2000

PRINCIPAL PLACE OF BUSINESS

Suite 305, Level 3 Barrack House 16-20 Barrack Street SYDNEY NSW 2000

MANAGER

ECP Asset Management Pty Ltd ACN 158 827 582 Suite 305, Level 3 343 George Street SYDNEY NSW 2000

Authorised representative of EC Pohl & Co Pty Ltd ACN 154 399 916 AFSL 421704

SOLICITORS

McCullough Robertson Lawyers ABN 42 721 345 951 Level 32 MLC Centre 19 Martin Place SYNDEY NSW 2000

AUDITORS

Leslie Pines Suite 1, 102 Spofforth Street CREMORNE NSW 2090

SHARE REGISTRY

Boardroom Pty Limited ABN 14 003 209 836 GPO Box 3993 SYDNEY NSW 2001 Toll Free: 1300 737 760 International: +61 (0) 2 9290 9600 Fax: +61 (0) 0 9279 0664

REGISTERED OFFICE

Suite 305, Level 3 Barrack House 16-20 Barrack Street SYDNEY NSW 2000 Tel: +61 (0) 2 8651 6800 Fax: +61 (0) 2 8651 6899 Email: [email protected]

WEBSITE ADDRESS

www.barrackst.com

Tel: +61 (0) 2 8651 6800 Fax: +61 (0) 2 8651 6899 Email: [email protected]

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Barrack St Investments Limited (ACN 167 689 821)

Suite 305, Level 3 Barrack House 16–20 Barrack St Sydney NSW 2000

www.barrackst.com

AI assistant

ECP EMERGING GROWTH LIMITED — Annual Report 2016

64817_rns_2016-09-22_85219952-c73b-49c8-bd11-b9597e684f2f.pdf

FINANCIAL YEAR END

INVESTING IN BARRACK ST INVESTMENTS LIMITED

TABLE OF CONTENTS

HIGHLIGHTS FOR 2016

TOP 10 INVESTMENTS

SECTOR BREAKDOWN

OVERVIEW

COMPANY PROFILE

MISSION

INVESTOR BENEFITS

INVESTMENT MANAGER

OBJECTIVES

CHAIRMAN’S REPORT

Dear Shareholder,

DIRECTORS' REPORT

1. DIRECTORS

2. INFORMATION ON DIRECTORS

Murray H d’Almeida

Experience and expertise

Other Current directorships

Dr Emmanuel (Manny) C Pohl

Experience and expertise

Other current directorships

Interest in Shares

Interest in Shares

Experience and expertise

Experience and expertise

Other current directorships

DIRECTORS’ REPORT (Continued)

3. PRINCIPAL ACTIVITIES

4. REVIEW OF OPERATIONS

5. SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

6. MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR

7. LIKELY DEVELOPMENTS AND EXPECTED

RESULTS OF OPERATIONS

8. ENVIRONMENTAL ISSUES

9. DIVIDENDS PAID

10. EARNINGS PER SHARE

11. COMPANY SECRETARY

Brian Jones B.Com, FCA

12. MEETINGS OF DIRECTORS

13. REMUNERATION REPORT (AUDITED)

(B) Details of remuneration

DETAILS OF REMUNERATION

(C) Service agreements

(D) Share-based compensation

DIRECTORS’ REPORT (Continued)

END OF REMUNERATION REPORT (AUDITED)

14. GENERAL TRANSACTIONS

15. LOANS

16. OPTIONS

17. INSURANCE OF OFFICERS AND/OR AUDITORS

18. PROCEEDINGS ON BEHALF OF THE COMPANY

19. NON-AUDIT SERVICES

AUDITOR’S INDEPENDENCE DECLARATION

AUDITORS INDEPEDENCE DECLARATION UNDER S 307C OF THE CORPORATIONS ACT 2001 TO THE DIRECTORS OF BARRACK ST INVESTMENTS LIMITED

CORPORATE GOVERNANCE STATEMENT : FOR THE YEAR ENDED 30 June 2016

PRINCIPLE 1:

Lay solid foundations for management and oversight

Recommendation 1.1: Respective roles and responsibilities of its Board and Management

Compliant

Recommendation 1.2: Information prior to Director election/re-election

Compliant

Recommendation 1.3: Written agreement with each Director and senior executive setting out the terms of their appointment

Compliant

Compliant

Recommendation 1.5: Gender Diversity

Not Compliant

Recommendations 1.6 and 1.7: Board and Senior Executive Evaluation

Compliant

PRINCIPLE 2:

Structure the Board to add value

Recommendation 2.1: Establish a Nomination Committee

Not Compliant

Recommendation 2.2: Have and disclose a Board skills matrix

PRINCIPLE 3:

Act ethically and responsibly

ECP EMERGING GROWTH LIMITED Annual Report 2016