ENECO REFRESH LTD — Annual Report 2013

Sep 26, 2013

Annual Report 2013

Contents

CHAIRMAN’S REVIEW .................................................................................. 1 DIRECTORS’ REPORT .................................................................................... 2 AUDITORS’ INDEPENDENCE DECLARATION ....................................... 10 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME ....................................................................... 11 CONSOLIDATED STATEMENT OF FINANCIAL POSITION .................. 12 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ................... 13 CONSOLIDATED STATEMENT OF CASH FLOWS .................................. 14 NOTES TO THE FINANCIAL STATEMENTS ............................................ 15 DIRECTORS’ DECLARATION .................................................................... 43 INDEPENDENT AUDITORS’ REPORT ....................................................... 44 CORPORATE GOVERNANCE STATEMENT ............................................ 47 SHAREHOLDER INFORMATION ............................................................... 50 CORPORATE DIRECTORY .......................................................................... 52

REFRESH GROUP LIMITED and its controlled entities

CHAIRMAN’S REVIEW

Dear Shareholders,

On behalf of the Board of Directors, I am pleased to present to you the Annual Report of Refresh Group Limited for the financial year ended 30 June 2013.

The global economy continued to be affected by the ongoing financial challenges of the European Union. Furthermore with China’s economy slowing down, it indirectly impacted the economy of Australia, where we saw a slowdown in the general trading and economic environment.

Despite the difficult and challenging environment, Refresh’s business remains stable and well-placed to endure the current trading environment. Refresh reported higher revenue compared to last year by 14%. Though the operational costs increased by 7.5%, our loss for the year was kept constant at $75,000. The higher cost of operations is due to general inflation and higher cost of equipment maintenance, which is a one-off expense. Refresh also adopted a cautious approach towards cost management, in the face of rising costs of operations.

Refresh reported a strong operating cash flow, reflecting an improved earnings trend and better working capital management. Refresh was also able to pay down its third party loans by $120,000, reducing its gearing. In July 2013, Refresh raised $300,000 in equity to fund its operations and to strengthen its balance sheet.

During the year, Refresh had also strengthened its management with the appointment of a new Chief Operating Officer in September 2012. The bottled water industry continued to see intense competition. Refresh is confident that with its focus on customer service, sales and marketing, it will be able to penetrate the market further to capture sales. Last year, Refresh also saw the departure of our long time Director Mr Edmund Teo. His contribution to the Board is significantly appreciated.

Refresh is also constantly on the lookout for growth opportunities and synergistic partnership to enhance shareholder’s value while continuing to focus on our existing core businesses. Refresh will continue to strive to report better results our shareholders.

Finally, I would like to express a note of thanks to members of the Board of Directors for their guidance, the professionals for their valuable advice, my colleagues, and most of all to you, our shareholders for your continued support.

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Henry Heng Chairman

REFRESH GROUP LIMITED and its controlled entities 1

DIRECTORS’ REPORT

The directors of Refresh Group Limited (Refresh) present the annual financial report of the consolidated entity, being Refresh Group Limited and its controlled entities (Group) for the financial year ended 30 June 2013. In order to comply with the provisions of the Corporations Act 2001, the directors report as follows.

Directors

The names and particulars of the directors of the company during or since the end of the financial year are:

Henry Heng MBA, ACIB, G Dip PM Chairman and Managing Director

Appointed on 11 August 1997, Henry Heng is a founding shareholder and director of Refresh.

He started his career in banking and is an Associate of the Chartered Institute of Bankers, London. He subsequently held management positions in multinational corporations. Henry’s experience extends to small and medium enterprises, being founding partner of a chain of child care centres and a distribution business in Singapore. He was a licensed securities dealer with the Singapore Stock Exchange.

Henry is active in social and community services and was a volunteer migration agent. He was on the Board of Grace City Church for 11 consecutive years. Henry subsequently sat on the Governing Council of Edith Cowan University for 3 years and was also a member of their Resources Committee. Henry has been Honorary Secretary of the Full Gospel Business Men’s Fellowship International, Perth Chapter since July 2010. He is also Branch Secretary of Family First Party WA since August 2012.

He is a member of the Australian Institute of Company Directors. He holds a Master of Business Administration from Edith Cowan University, a Graduate Diploma in Personnel Management from Singapore Institute of Management and a Banking Diploma from The Chartered Institute of Bankers.

Henry did not hold directorship in any listed company in the last three years.

Mun Yew Chan B Arts (Hons), CA Non-Executive Director

Appointed on 13 July 2010

Mun Yew Chan has almost 30 years of financial management experience at senior management levels in fast moving consumer goods, electronics, telecommunications, oilfield service and public accounting. He began his career at Ernst & Young and went on to hold Financial Controller/Director positions with major multinational corporations listed on NYSE and NASDAQ namely National Semiconductor, Quantum Corp, Schlumberger Inc. and Glenayre Inc.

He holds a Bachelor of Arts (Honours) in Economics and Accounting from the University of Newcastle, United Kingdom and is a Chartered Accountant (ICAEW).

Mun Yew was an independent, non-executive director of Jade Technologies Holdings Ltd, a company listed on the Catalist Board of Singapore Exchange Ltd. Besides being Chairman of the Audit Committee, he was also a member of the Nominating & Corporate Governance Committee and Remuneration Committee. Mun Yew does not currently hold any other directorship in any listed company.

REFRESH GROUP LIMITED and its controlled entities 2

DIRECTORS’ REPORT

Jamie Gee Choo Khoo MBA, B Acc Independent, Non-Executive Director

Appointed on 1 November 2010.

Jamie Khoo has held senior positions in various companies including STT Communications Ltd and Hughes Tool Singapore Pte Ltd of Singapore and ABB Holding Ltd of Hong Kong. She has much experience in mergers and acquisitions and capital raising. From September 2008 to September 2010, she was the Executive Director of Adventus Holdings Ltd, a company listed on the Catalist Board of Singapore Exchange Ltd. Under her leadership, Adventus was transformed from a fledging electronics company to a telecommunications distribution and resources trading company.

Jamie graduated from the National University of Singapore with a Bachelor of Accountancy and the University of Hull, United Kingdom, with a Master of Business Administration.

She is also an independent, non-executive director of ASX-listed MDS Financial Group Ltd.

Edmund Teo Independent, Non-Executive Director

Appointed on 11 August 1997, Edmund Teo is a founding shareholder and director of Refresh.

Edmund had a successful career in journalism between 1974 and 1995. During this period he was a London Correspondent for The Straits Times newspapers in Singapore; Chief Transport Correspondent for The Straits Times; and Acting Assistant to the Editor of the financial section of The Straits Times. He left the newspaper as an Executive Sub-Editor in 1993 to live in Australia. In Perth, he worked as a Sub-Editor with The West Australian newspapers from 1993 to 1995.

He was appointed an Executive Director in August 1997 and served in the position until December 2007. He is currently a Sub-Editor at Community Newspapers Group.

Edmund holds Reporting Certificates with the British Institute of Careers (Australia) and the Graduate London School of Journalism.

Edmund left the Board on 31 December 2012. He did not hold directorship in any listed company in the last three years.

Secretary

The name and particulars of the secretary of the company during or since the end of the financial year is:

Jamie Gee Choo Khoo MBA, B Acc Company Secretary

Appointed on 1 March 2011.

Jamie Khoo has held senior positions in various companies including STT Communications Ltd and Hughes Tool Singapore Pte Ltd of Singapore and ABB Holding Ltd of Hong Kong. She has much experience in mergers and acquisitions and capital raising. From September 2008 to September 2010, she was the Executive Director of Adventus Holdings Ltd, a company listed on the Catalist Board of Singapore Exchange Ltd. Under her leadership, Adventus was transformed from a fledging electronics company to a telecommunications distribution and resources trading company.

Jamie graduated from the National University of Singapore with a Bachelor of Accountancy and the University of Hull, United Kingdom, with a Master of Business Administration.

She is also an independent, non-executive director of ASX-listed MDS Financial Group Ltd.

REFRESH GROUP LIMITED and its controlled entities 3

DIRECTORS’ REPORT

(a) Review of Operations and Financial Results

The Company is growing well with revenue increase of 14% compared with the previous year. The placement of new shares for $300k to Australian Glamour Pty Ltd on 11 July 2012 helped provide the working capital for this growth.

The good performance was mainly attributed to:

1. Revenue growth and improved profitability has been consistent across all 4 operating segments. This resulted from improved marketing efforts. All segments showed improved revenue. The best performance was Victoria with revenue growing by 37%. Detailed results are found in Note 4 Operating Segment.

2. Australia underwent one of its hottest summers which has helped immensely in this growth.

This resulted in every operating segment of the Company being profitable, achieving an Earning before Interest, Tax, Depreciation and Amortisation (EBITDA) of $814k for the operating segments, before corporate expenses. Reduced overall profitability came about mainly because of increase in accruals and provisions recognised at corporate level. Net loss of $75k resulted from interest expenses. With a substantial amount of borrowings paid off, the reduced interest will help the Company achieve a net profit sooner.

Going forward, the Company also envisage further efforts in marketing as well as looking at new markets and strategic partners to further grow its top line and improved the Company’s performance. Currently the Group has an offer to take up a 51% investment within our Refresh Waters Queensland entity with the potential for further investments into our eastern states entities. This is discussed further below.

(b) Significant Changes in State of Affairs

On 11 July 2012, the Company made a placement of 10 million shares at 3 cents to raise $300,000. On 12 July 2012, the Company issued 2,282,859 shares to its directors in lieu of directors’ fees, conserving cash of $79,900.

(c) Principal Activities

The principal activity of Refresh during the year was the production and/or distribution of lifestyle products including bottled water, coolers and filtration systems. There was no significant change in the nature of the activity of the entity during the year.

(d) Significant after Balance Date Events

The Group is in the final stage of negotiations with Saisan Co Ltd (Saisan), to sell it a 51% stake in its wholly-owned subsidiary, Refresh Waters Queensland Pty Ltd (Queensland). Refresh will continue to manage the Queensland operations after the sale.

Saisan was established in 1945 and is presently a leading supplier of bottled gas in Japan. Its gas business has expanded internationally to China, Mongolia and Vietnam. It has also diversified into bottled water and is looking into expanding its bottled water business. In the last financial year, its revenue was $585 million with operating profit of $23 million.

REFRESH GROUP LIMITED and its controlled entities 4

DIRECTORS’ REPORT

(e) Likely Future Developments

The Group will be focusing on its core business for the next financial year and no major change in activity is expected.

(f) Performance in Relation to Environmental Regulation

Federal and State governments regulate bottled water as a food product under the Australian and New Zealand Code Standard 08. All Refresh bottling plants meet the requirements stipulated in the Food Code.

In addition to collection of rain water where feasible, all bottling plants currently use state supplied water for purposes of steam-distilling it.

To reduce our carbon footprint, the Perth factory has solar panels installed providing 2.2 kw of power.

(g) Dividends

No dividend has been paid or declared for the year ended 30 June 2013. No dividend was paid in the previous year.

(h) Meetings of Directors

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

	Board	Meetings	Audit Committee	Audit Committee	Remuneration	Committee
	Number		Number		Number
	eligible to	Number	eligible to	Number	eligible to	Number
	attend	attended	attend	attended	attend	attended
Henry Heng	5	5	-	-	1	1
Edmund Teo *	3	2	2	1	-	-
Mun Yew Chan	5	5	2	2	1	1
Jamie Khoo	5	5	2	2	1	1

• left on 31 December 2012

There was no nominations committee during the financial year and all decisions were made by the full Board. After Mr Teo left the Board, the Audit and Remuneration Committees were suspended and all decisions are made by the full Board.

(i) Shares issued during or since the end of the year as a result of exercise

During or since the end of the financial year, the Company issued ordinary shares as a result of the exercise of options as follows (there were no amounts unpaid on the shares issued):

Date optionsgranted	Issueprice of shares($)	Number of shares issued
Nil

REFRESH GROUP LIMITED and its controlled entities 5

DIRECTORS’ REPORT

(j) Remuneration Report (Audited)

The performance of Refresh depends upon the quality of its directors and key management personnel. To achieve success, the company must attract, motivate and retain highly skilled directors and key management personnel. To this end, the company proposes to adopt the following principles in its remuneration framework:

• Provide competitive rewards to attract high calibre key management personnel;

• Link executive rewards to shareholder value and

• Establish appropriate performance hurdles in relation to variable key management personnel remuneration.

Company Performance, Shareholder Wealth and Director and Key Management Personnel Remuneration

The remuneration policy has been tailored to increase goal congruence between shareholders, directors and key management personnel. There have been 2 methods applied in achieving this aim, the first being a performance based bonus based on key performance indicators (KPIs), and the second being the issue of options to all directors and key management to encourage the alignment of personal and shareholder interests. The company believes this policy has been effective.

Remuneration for all directors is determined by the Board, within the maximum amount approved by shareholders from time to time. At present, the aggregate sum is fixed at a maximum of $200,000 per annum. Superannuation is paid on director fees.

All executive directors and key management personnel receive a base salary, superannuation, fringe benefits, options and performance incentives. Performance incentive is paid upon achievement of KPIs or performance targets. The KPIs are set annually, with a certain level of consultation with key management personnel. The measures are specifically tailored to the areas each key management personnel are involved in and have a level of control over. The KPIs target areas the Board believes hold greater potential for group expansion and profit, covering financial and non-financial as well as short and long term goals. The level set for each KPI is based on budgeted figures for the Group and respective industry standards.

The Company’s remuneration policy was implemented after the listing and there is insufficient information to provide a meaningful quantitative analysis of the relationship between remuneration and company performance. Over the years, several directors and key management personnel have achieved their KPIs and received performance incentives.

To align the interests of the directors and key management of Refresh, the Directors and Executives Option Scheme provides a cost-effective and efficient long-term incentive to them which is linked to the performance of the company. By rewarding executives with the issue of options, Refresh will be able to reward them without having to commit cash resources to do so. Directors and key management personnel are granted options to motivate them to pursue the long term growth and success of the company within an appropriate control framework and demonstrate a clear relationship between key management performance and remuneration. Details of the scheme are found on Note 26 of the Financial Report.

All remuneration paid is valued at the cost to the Company and expensed. Shares given to key management personnel are valued as the difference between the market price of those shares and the amount paid by the key management personnel. Options are valued using the Black-Scholes methodology.

The Company has not engaged independent remuneration consultants.

(k) Voting and comments made at the company’s last Annual General Meeting

Refresh received more than 100% of ‘yes’ votes on its Remuneration Report for the financial year ending 30 June 2012. The Company receives no specific feedback on its Remuneration Report at the Annual General Meeting.

REFRESH GROUP LIMITED and its controlled entities 6

DIRECTORS’ REPORT

(l) Directors and Key Management Personnel Disclosure

(i) Remuneration of Directors

Directors 30 June 13 Mr H Heng Mr E Teo Mr M Y Chan Ms J Khoo Total 30 June 12 Mr H Heng Mr E Teo Mr M Y Chan Ms J Khoo Total*	SHORT TERM EMPLOYEE BENEFITS POST EMPLOYMENT EQUITY % TOTAL REMUNERATION Salary & Fees Non- Monetary benefits # Superan- nuation Retirement benefits Options Performance Bonus Related $ $ $ $ $ $ $
	139,850 85,091 6,571 20,245 - 251,757 34 7,500 - - 675 - - 8,175 - 16,000 - - 1,440 - - 17,440 - 16,000 - - 1,440 - - 17,440 - 179,350 85,091 6,571 23,800 - - 294,812 138,702 - 4,404 17,483 - 160,589 - 15,000 - - 1,350 - - 16,350 - 17,000 - - 1,530 - - 18,530 - 17,000 - - 1,530 - - 18,530 - 187,702 - 4,404 21,893 - - 213,999

Use of company car and insurance-in-lieu Workers Compensation

* Mr Teo left on 31 December 2012

(ii) Remuneration of Key Management Personnel

The key management of Refresh includes:

Ms M Tan Chief Financial Officer (left 26 October 2012) Mr O Maerker Chief Operating Officer (joined 3 September 2012) Mr R Bolton Queensland Director Mr H Ho Victoria Manager Mr P Sun New South Wales Manager (left 28 February 2013)

REFRESH GROUP LIMITED and its controlled entities 7

DIRECTORS’ REPORT

(l) Directors and Key Management Personnel Disclosure (cont)

(ii) Remuneration of Key Management Personnel (cont)

30 June 13 Mr O Maerker1 Mr R Bolton Mr H Ho Ms M Tan2 Mr P Sun3 Total 30 June 12 Ms M Ang Mr R Bolton Mr. S Lin Mr H Ho Ms M Tan Mr P Sun Total

SHORT TERM EMPLOYEE BENEFITS POST EMPLOYMENT EQUITY SHARE- BASED PAYMENT TOTAL % REMUNERA TION Salary & Fees Bonus Non- Monetary benefits Superan -nuation Retirement benefits/ termination Options Remuneration Performance Related $ $ $ $ $ $ $ $

74,423 21,000 - 8,588 - - - 104,011 20 70,000 6,000 - 6,840 - - - 82,840 7 57,482 8,000 - 5,893 - - - 71,375 11 35,246 - - - - - - 35,246 - 39,189 3,717 3,861 - - - 46,767 8 276,340 38,717 - 25,182 - - - 340,239 , 31,646 - 2,848 - - - 34,494 - 75,000 - 6,468 - - - 81,468 - 65,905 - 5,218 - - - 71,123 - 56,999 - 5,130 - - - 62,129 - 47,933 - 1,566 - - - 49,499 - 15,865 1,428 - - - 17,293 - 293,348 - 22,658 - - - 316,006

1 Mr O Maerker joined the company on 3 September 2012

2 Ms M Tan left the company on 26 October 2012

3 Mr P Sun left the company on 28 February 2013

(iii) Remuneration options: Granted and vested during the year

During the financial year, no options were granted as equity compensation benefits under the Directors and Executives Option Scheme (DEOS). There is also no outstanding option as at 30 June 2013.

(m) Service Agreements

None of the Directors or Key Management Personnel is employed on service agreements.

(n) Unissued shares under option

Unissued ordinary shares under option at the date of this report date are:

Date options granted Expiry date 27 Nov 2012 20 Jun 2013 27 Nov 2012 20 Dec 2013 27 Nov 2012 20 Jun 2014 27 Nov 2012 20 Jun 2015	Exercise price of options ($) 0.03 0.04 0.05 0.06	Number options Issued 10,000,000 7,500,000 4,000,000 5,000,000	Exercisable Period 27 Nov 2012 to 20 Jun 2013 20 Jun 2013 to 20 Dec 2013 20 Dec 2013 to 20 Jun 2014 20 Jun 2014 to 20 Jun 2015	Number Lapsed
				10,000,000

REFRESH GROUP LIMITED and its controlled entities 8

DIRECTORS’ REPORT

(n) Unissued shares under option (cont)

These options were issued to Mr Richard Tan and/or his nominees pursuant to a Share Allotment Agreement dated 20 June 2012 and approved by Shareholders at the Annual General Meeting held on 27 November 2012. All options expire on their respective expiry dates.

10,000,000 options at $0.03 which expired on 20 June 2013 were not exercised.

(o) Indemnifying Directors and Officers

The Company has taken out a Directors and Officers Liability Insurance protecting directors and officers against claims resulting from management decisions. The insurance contract prohibits disclosure of the limit of liability, the nature of liability indemnified or the premium paid.

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

(p) Non-audit Services

The directors are satisfied that the provision of non-audit services during the year by the auditors is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001.

The directors are satisfied that the provision of non-audit services did not compromise the auditor independence for the following reasons:

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

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

Details of amount paid to auditors for audit and non-audit services provided during the year are disclosed in Note 24.

(q) Proceedings on Behalf of the Company

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

The company was not a party to such proceedings during the year.

(r) Auditor’s Independence Declaration

The Auditor’s Independence Declaration under section 370C is included on page 10 of the Directors’ Report.

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

On behalf of the Directors

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Henry Heng Managing Director PERTH, 27 September 2013

REFRESH GROUP LIMITED and its controlled entities 9

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Auditor’s Independence Declaration To the Directors of Refresh Group Limited

10 Kings Park Road West Perth WA 6005 PO Box 570 West Perth WA 6872 T +61 8 9480 2000 F +61 8 9322 7787 E info.wa@au.gt.com W www.grantthornton.com.au

In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Refresh Group Limited for the year ended 27 September 2013, I declare that, to the best of my knowledge and belief, there have been:

• a no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and

• b no contraventions of any applicable code of professional conduct in relation to the audit.

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GRANT THORNTON AUDIT PTY LTD Chartered Accountants

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C A Becker Partner - Audit & Assurance

Perth, 27 September 2013

Grant Thornton Audit Pty Ltd ACN 130 913 594

a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.

10

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2013

Note Revenue 6a Cost of Sales 6e Gross Profit Other income Marketing Expenses Distribution Expenses Administrative Expenses Occupancy Expenses Other expenses 14 Results from operating activities Finance income 6c Finance costs 6d Loss before income tax Income tax expense 7 Net Loss attributable to members of Refresh Group Limited Total comprehensive Loss attributable to members of Refresh Group Limited Basic/diluted earnings/(loss) per share (cents per share) Basic loss per share 8 Diluted loss per share	Note	CONSOLIDATED 2013 $ 2012 $
		6,884,597 6,042,772 (2,869,919) (2,273,017)
		4,014,678 3,769,755 19,272 (23,443) (555,778) (495,394) (1,301,992) (1,222,854) (1,565,055) (1,438,322) (606,371) (572,884) (5,500) -
		(746) 16,858 5,577 186 (80,122) (92,330)
		(75,291) (75,286) - -
		(75,291) (75,286)
		(75,291) (75,286)
		(0.08) (0.09) (0.08) (0.09)

The accompanying notes form part of the Consolidated Statement of Profit or Loss and Other Comprehensive Income

REFRESH GROUP LIMITED and its controlled entities 11

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2013

ASSETS Current Assets Cash and cash equivalents Trade and other receivables Inventories Total Current Assets Non-Current Assets Property, plant and equipment Intangible assets Total Non-current assets TOTAL ASSETS LIABILITIES Current Liabilities Trade and other payables Financial liabilities Short-term provisions and accruals Total Current Liabilities Non-Current Liabilities Financial liabilities Long-term provisions Total Non-Current Liabilities TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Reserves Accumulated losses TOTAL EQUITY	Notes	CONSOLIDATED 2013 2012 $ $
	10 11 12 13 14 16 17 18 17 18 19 19	224,194 152,542 788,914 633,221 965,208 868,013
		1,978,316 1,653,776
		1,919,847 1,933,773 781,815 756,415
		2,701,662 2,690,188
		4,679,978 4,343,964
		680,354 538,528 291,098 409,030 174,690 120,277
		1,146,142 1,067,835
		25,452 46,550 27,075 49,468
		52,527 96,018
		1,198,669 1,163,853
		3,481,309 3,180,111
		8,783,084 8,406,595 191,712 191,712 (5,493,487) (5,418,196)
		3,481,309 3,180,111

The accompanying notes form part of the Consolidated Statement of Financial Position

REFRESH GROUP LIMITED and its controlled entities 12

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2013

Consolidated Balance at 1 July 2011 Prior year adjustment1 Transactions with owners Total loss for the year Other comprehensive income, net of tax Balance at 30 June 2012 Balance at 1 July 2012 Equity fund raising costs Issue of share capital Transaction with owners Total loss for the year Other comprehensive income, net of tax Balance at 30 June 2013	Issued Reserves Accumulated Capital Losses Total
	8,406,595 191,712 (5,354,697) 3,243,610 - - 11,787 11,787
	8,406,595 191,712 (5,342,910) 3,255,397 - - (75,286) (75,286) - - - -
	8,406,595 191,712 (5,418,196) 3,180,111
	8,406,595 191,712 (5,418,196) 3,180,111 (3,411) - - (3,411) 379,900 - - 379,900
	8,783,084 191,712 (5,418,196) 3,556,600 - - (75,291) (75,291) - - - -
	8,783,084 191,712 (5,493,487) 3,481,309

1 Adjustments have been made to prior period arising from cumulative errors in the calculation of depreciation in previous years.

The accompanying notes form part of the Consolidated Statements of Changes in Equity

REFRESH GROUP LIMITED and its controlled entities 13

CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2013

Notes Cash flows from operating activities Receipts from customers Payments to suppliers and employees Borrowing costs Interest received Net cash flows provided by/(used in) operating activities 10 Cash flows from investing activities Purchase of Intangible Purchase of property, plant and equipment Net cash flows provided by/(used in) investing activities Cash flows from financing activities Proceeds from issue of shares Loans from related parties Share issue expenses Repayments of borrowings Net cash flows provided by financing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	CONSOLIDATED 2013 2012 $ $
	6,884,597 6,061,000 (6,684,854) (5,853,772) (80,122) (74,059) 5,577 186
	125,198 133,355
	(30,900) 10,877 (260,105) (132,206)
	(291,005) (121,329)
	379,900 - (120,000) 62,000 (3,411) - (19,030) (51,771)
	237,459 10,229
	71,652 22,255 152,542 130,287
	224,194 152,542

The accompanying notes form part of the Consolidated Statement of Cash Flows

REFRESH GROUP LIMITED and its controlled entities 14

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

1. CORPORATE INFORMATION

The financial report of Refresh Group Limited for the year ended 30 June 2013 was authorised for issue in accordance with a resolution of the directors on 27 September 2013.

Refresh Group Limited is a company limited by shares incorporated and domiciled in Australia; their shares are publicly traded on the Australian Securities Exchange.

The Group’s principal activities are the production and/or distribution of lifestyle products like bottled water, coolers and filtration systems. The Company is a for-profit entity.

ADOPTED

2.1 New Accounting Standards adopted by the Group

AASB 2010-8 Amendments to Australian Accounting Standard – Deferred Tax: Recovery of Underlying Assets (Applies to annual reporting periods beginning on or after 1 January 2012)

AASB 2010-8 provides clarification on the determination of deferred tax assets and deferred tax liabilities when investment property is measured using the fair value model in AASB 140 Investment Property . It introduces a rebuttable presumption that an investment property is recovered entirely through sale. This presumption is rebutted if the investment property is held within a business model where the objective is to consume substantially all of the economic benefits embodied in the investment property over time, rather than through sale.

AASB 2010-8 also includes the requirement that the measurement of deferred tax assets and deferred tax liabilities on non-depreciable assets measured using the revaluation model in AASB 116 Property, Plant and Equipment should always be based on recovery through sale. These amendments have had no impact on the Group.

– AASB 2011-9 Amendments to Australian Accounting Standards Presentation of Items of Other Comprehensive Income (Applies annual reporting periods beginning on or after 1 July 2012)

AASB 2011-9 requires entities to group items presented in Other Comprehensive Income (OCI) on the basis of whether they are potentially reclassifiable to profit or loss subsequently, and changes the title of ‘statement of comprehensive income’ to ‘statement of profit or loss and other comprehensive income’.

The adoption of the new and revised Australian Accounting Standards and Interpretations has had no significant impact on the Group’s accounting policies or the amounts reported during the current half-year period. The adoption of AASB 2011-9 has resulted in changes to the Group’s presentation of its financial statements.

2.2 New standards and interpretations not yet adopted

The AASB has issued a number of new and amended Accounting Standards and Interpretations that have mandatory application dates for future reporting period, some of which are relevant to the Group. The Group has decided not to early adopt any of the new and amended pronouncements. The Group’s assessment of the new and amended pronouncements that are relevant to the Group but applicable in future reporting periods is set out below:

� AASB 9: Financial Instruments (December 2010) and AASB 2010-7: Amendments to Australian Accounting Standards arising from AASB 9 (December 2010).

This standard is mandatorily applicable for annual reporting periods commencing on or after 1 January 2013. However, AASB 2012-6 defers the application date of AASB 9 from 1 January 2013 to 1 January 2015. AASB 9 introduces new requirements for the classification and measurement of financial assets and liabilities.

The entity does not have any financial liabilities. Therefore, the Directors do not anticipate that the adoption of this standard will have any impact on the financial statements.

REFRESH GROUP LIMITED and its controlled entities 15

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

ADOPTED (cont)

2.2 New standards and interpretations not yet adopted (cont)

� AASB 10: Consolidated Financial Statements , AASB 11: Joint Arrangements , AASB 12: Disclosure of Interests in Other Entities, AASB 127: Separate Financial Statements (August 2011) and AASB 128: Investments in Associates and Joint Ventures (August 2011) (as amended by AASB 2012-10: Amendments to Australian Accounting Standards – Transition Guidance and Other Amendments) , and AASB 2011-7: Amendments to Australian Accounting Standards.

AASB 10 provides a revised definition of “control” and additional application guidance so that a single control model will apply to all investees. When adopted, this Standard is not expected to significantly impact the Group’s financial statements.

AASB 11 requires joint arrangements to be classified as either “joint operations” (where the parties that have joint control of the arrangement have rights to the assets and obligations for the liabilities) or “joint ventures” (where the parties that have joint control of the arrangement have rights to the net assets of the arrangement). When adopted, this Standard is not expected to significantly impact the Group’s financial statements.

AASB 12 contains the disclosure requirements applicable to entities that hold an interest in a subsidiary, joint venture, joint operation or associate. AASB 12 also introduces the concept of a “structured entity”, replacing the “special purpose entity” concept currently used in Interpretation 112, and requires specific disclosures in respect of any investments in unconsolidated structured entities. When adopted, this Standard will affect disclosures only and therefore will have no impact on the Group’s financial statements.

� AASB 13: Fair Value Measurement and AASB 2011-8: Amendments to Australian Accounting Standards arising from AASB 2013 (applicable for annual reporting periods commencing on or after 1 January 2013).

� AASB 13 establishes a single source of guidance for determining the fair value of assets and liabilities. AASB 13 does not change when an entity is required to use fair value, but rather, provides guidance on how to determine fair value when fair value is required or permitted by other Standards.

These Standards are expected to result in more detailed fair value disclosures, but are not expected to significant impact the amounts recognised in these financial statements.

� AASB 2011-4: Amendments to Australian Accounting Standards to Remove Individual Key Management Personnel Disclosure Requirements (applicable for annual reporting periods beginning on or after 1 January 2013).

This Standard makes amendments to AASB 124 Related Party Disclosures to remove the individual key management personnel (KMP) disclosure requirements by Australia specific paragraphs.

When adopted, these amendments are unlikely to have any significant impact on the financial statements.

� AASB 119: Employee Benefits (September 2011) and AASB 2011-10: Amendments to Australian Accounting Standards arising from AASB 119 (September 2011) (applicable for annual reporting periods beginning on or after 1 January 2013).

This Standard introduces a number of changes to presentation and disclosure of a defined benefit plan. AASB 119 also includes changes to the criteria for determining when termination benefits should be recognised as obligation.

The entity does not have any defined benefit plans. Therefore, these amendments will have no significant impact on the entity.

REFRESH GROUP LIMITED and its controlled entities 16

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

ADOPTED (cont)

2.2 New standards and interpretations not yet adopted (cont)

� AASB 2012-2: Amendments to Australian Accounting Standards – Disclosures – Offsetting Financial Assets and Financial Liabilities (application for annual reporting periods commencing on or after 1 January 2014).

This Standard amends the required disclosures in AASB 7 to include information that will enable users of an entity’s financial statements to evaluate the effect or potential effect of netting arrangements, including rights of set-off associated with the entity’s recognised financial assets and recognised financial liabilities, on the entity’s statement of financial position.

When adopted, there will be no impact on the entity as the entity does not have any netting arrangements in place.

� AASB 2012-5: Amendments to Australian Accounting Standards arising from Annual Improvements 2009-2011 (applicable for annual reporting periods beginning on or after 1 January 2013).

These amendments are a consequence of the annual improvement process, which provides a vehicle for making non-urgent but necessary amendments to Standards.

When these amendments are first adopted, this Standard is not expected to significantly impact the Group’s financial statements.

3. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

3.1 Statement of compliance

These financial statements are general purpose financial statements which have been prepared in accordance with the Corporations Act 2001, Accounting Standards and Interpretations, and comply with other requirements of the law. Accounting Standards include Australian equivalents to International Financial Reporting Standards (‘IFRS’). Compliance with IFRS ensures that the financial statements and notes of the company and the Group comply with International Financial Reporting Standards (‘IFRS’).

3.2 Basis of preparation

The financial report has been prepared on the basis of historical cost, except for the revaluation of certain noncurrent assets and financial instruments. Cost is based on the fair values of the consideration given in exchange for assets. All amounts are presented in Australian dollars and rounded to the nearest dollar.

3.3 Basis of consolidation

The consolidated financial statements incorporate the financial statements of Refresh Group Limited and its controlled entities as at 30 June 2013 (‘the Group’). Control is achieved where the Company has the power to govern the financial and operating policies of any entity so as to obtain benefits from its activities.

The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate.

Inter-company loans which have no interest or repayment terms are effectively investments in controlled entities and are reflected at cost. All intra-group transactions, balances, income and expenses are eliminated in full on consolidation.

Accounting policies of subsidiaries have been changed where necessary to ensure consistencies with those policies applied by the Parent entity.

REFRESH GROUP LIMITED and its controlled entities 17

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

3. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (cont)

3.4 Property, plant and equipment

Plant and equipment, including leasehold improvements are stated at cost less accumulated depreciation and impairment losses.

Depreciation is provided on property, plant and equipment. Depreciation is calculated on a straight-line basis over the estimated useful life of all fixed assets except for motor vehicles which are depreciated on a reducing balance basis over 10 years. Leasehold improvements are depreciated over the period of the lease or estimated useful life, whichever is the shorter, using the straight-line method. The estimated useful lives and depreciation method are reviewed at the end of each annual reporting period, with the effect of any changes recognised on a prospective basis.

Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, the term of the relevant lease.

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

The gain or loss arising on disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in the income statement.

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

Leasehold improvements	5 to 15 years	Straight Line Method
Plant and equipment	5 to 15 years	Straight Line Method
Motor vehicles	10 years	Diminishing Value Method

3.5 Goodwill

Goodwill acquired in a business combination is initially measured at cost, being the excess of the cost of the business combination over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised at the date of the acquisition.

Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses.

3.6 Impairment of non-financial assets

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

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

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

3.7 Employee benefits

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

Liabilities recognised in respect of employee benefits are measured at their nominal values using the remuneration rate expected to apply at the time of settlement.

REFRESH GROUP LIMITED and its controlled entities 18

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

3. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (cont)

3.8 Inventories

Inventories are valued at the lower of cost and net realisable value. Costs incurred in bringing each product to its present location and condition is accounted for as follows:

• Raw materials - purchase cost

• Finished goods - cost of direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.

Net realisable value represents the estimated selling price for inventories less all estimated costs of completion and costs necessary to make the sale.

3.9 Trade and other receivables

Trade receivables, which generally have 30-90 day terms, are recognised and carried at original invoice amounts less an allowance for any uncollectible amounts.

An estimate for doubtful debts is made when collection of the full amount is no longer probable. Bad debts are written off when identified.

3.10 Cash and cash equivalents

Cash and cash equivalents comprise cash on hand; cash in bank and short-term deposits with an original maturity of three months or less. Bank overdrafts are shown within financial liabilities in current liabilities on the balance sheet.

For the purposes of the Consolidated Cash Flow Statement, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts.

3.11 Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

3.12 Share-based payment transactions

Share-based payments are provided to directors and employees of the Group whereby employees render services in exchange for shares or rights over shares.

There are currently two plans in place to provide these benefits:

• i. The Directors and Executives Option Scheme (DEOS), which provides benefits to directors and senior executives, and

• ii. The Employee Share Scheme (ESS), which provides benefits to all employees, excluding directors and senior executives.

Details of the plans are covered under Note 25 Employee Benefits.

The fair value of the equity to which employees become entitled is measured at grant date and recognised as an expense over the vesting period, with a corresponding increase to an equity account. The fair value of shares is ascertained as the market bid-price. The fair value of options is ascertained using a Black-Scholes pricing model which incorporates all market vesting conditions. The number of shares and options expected to vest is reviewed and adjusted at each reporting date such that the amount recognised for services received as consideration for the equity instruments granted shall be based on the number of equity instruments that eventually vest.

REFRESH GROUP LIMITED and its controlled entities 19

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

3. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Cont)

3.13 Leases

Leases are classified as finance leases when the terms of the lease transfer substantially all the risks and rewards incidental to ownership of the leased asset to the lessee. All other leases are classified as operating leases.

Assets held under finance leases are initially recognised at their fair value or, if lower, at amounts equal to the present value of the minimum lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation.

Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability.

Amortisation for finance leased assets is over the estimated useful life of the asset, on the same basis as owned assets.

Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

3.14 Revenue

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

Sale of goods

Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer and can be measured reliably. Risks and rewards are considered passed to the buyer at the time of delivery of the goods to the customer.

Interest Received

Interest revenue is recognised as it accrues taking into account the effective yield on the financial asset.

3.15 Borrowing costs

All borrowing costs are recognised in profit or loss in the period in which they are incurred and reported in ‘finance costs’.

REFRESH GROUP LIMITED and its controlled entities 20

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

3. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Cont)

3.16 Income tax

The income tax expense (revenue) for the year comprise current income tax expense (income) and deferred tax expense (income).

Deferred income tax expense reflects movements in deferred tax liability balances arising during the year.

Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for the financial reporting purposes.

Deferred income tax liabilities are recognised for all taxable temporary differences:

• except where the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

• in respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, except where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-forward of unused tax assets and unused tax losses can be utilised:

• except where the deferred income tax asset relating to the deductible temporary differences arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

• in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred tax assets are only recognised to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date.

3.17 Profit or loss from discontinued operations

A discontinued operation is a component of the entity that either has been disposed of, or is classified as held for sale, and:

• represents a separate major line of business or geographical area of operations;

• is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations; or

• is a subsidiary acquired exclusively with a view to resale.

Profit or loss from discontinued operations, including prior year components of profit or loss, is presented in a single amount in the statement of comprehensive income. This amount, which comprises the post-tax profit or loss of discontinued operations and the post-tax gain or loss resulting from the measurement and disposal of assets classified as held for sale.

REFRESH GROUP LIMITED and its controlled entities 21

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

3. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Cont)

3.18 Goods and services tax

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

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

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

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

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

3.19 Financial Instruments

Recognition

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

Derecognition

Financial assets are derecognised where the contractual rights to receipt of cash or cash flows expires or the asset is transferred to another party whereby the entity no longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised where the related obligations are either discharged, cancelled or expire.

Loans and receivables

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

Financial liabilities

Financial liabilities are recognised at amortised cost, comprising original debt less principal payments and amortisation.

Fair value

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

Impairment

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

3.20 Critical accounting estimates and judgements

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

REFRESH GROUP LIMITED and its controlled entities 22

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

3. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Cont)

3.20 Critical accounting estimates and judgements (cont)

Key estimates

Impairment

The Group assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to impairment of assets including property, plant and equipment, identifiable intangible assets and goodwill. In accordance with AASB 136 Impairment of Assets , the Group tests their intangible assets with an indefinite useful life for impairment by comparing its recoverable amount with its carrying amount.

Value in Use

Value-in-use calculations performed in assessing recoverable amounts incorporate a number of key estimates, including levels of operating revenue and terminal value of assets. A material change to these key assumptions could result in material adjustment to the carrying values of non-current assets.

Fair value

Management apply valuation techniques to determine the fair value of cash-generating units where active market quotes are not available. This requires management to develop estimates and assumptions based on market inputs, using observable data that market participants would use in pricing the cash-generating unit.. Where such data is not observable, management uses its best estimate. Estimated fair values of financial instruments may vary from the actual prices that would be achieved in an arm’s length transaction at the reporting date. The Group was able to obtain a best estimate based on the offer made by Saisan Co Ltd for a 51% investment within the eastern states cash-generating units.

No impairment has been recognised in respect of non-current assets including intangibles (goodwill) for the year ended 30 June 2013. Further particulars of impairment testing can be found in Note 15.

Share-based payment transactions

The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using the Black-Scholes formula, with the assumptions detailed in Note 25. The accounting estimates and assumptions relating to equitysettled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact expenses and equity.

Inter-company loan

The parent entity impaired its loan receivable in controlled entities. The value was determined based upon financial modelling which was undertaken to determine the recoverable amount.

Depreciation

During the year ended 30 June 2013 there was a change in the accounting of depreciation for motor vehicles. The change is to reflect the life of the asset from a straight line method to a diminishing value basis. The effect of the change in depreciation method has resulted in depreciation for the current year being $56,178, a decrease of $473 if compared to a straight line method.

3.21 Going Concern

The financial report has been prepared on a going concern basis, which contemplates continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business.

The Consolidated entity incurred a net loss of $75,291 and had cash inflows from operations of $119,698 during the year ended 30 June 2013.

The ability of the consolidated entity to continue paying its debts as and when they fall due is dependent upon the consolidated entity improving the profitability of its operations, the raising of additional equity funds and finance funding from related parties (as and when required) or limiting the consolidated entity’s cash burn rate.

REFRESH GROUP LIMITED and its controlled entities 23

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

3. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Cont)

3.21 Going Concern (cont)

The Group continues to focus on its core business, Revenue is growing well and profitability is expected to be achieved in the near future. With the 51% investment by Saisan Co Ltd, additional funding has reassured the going concern assumption.

In the event that the consolidated entity is unable to continue as a going concern, it may be required to realise all assets at amounts different from that recorded in the statement of financial position, settle liabilities other than in the ordinary course of business, and make provision for other costs which may arise as a result of cessation or curtailment of normal business procedures.

4. OPERATING SEGMENTS

Segment Information

The Group has identified its operating segments based on the internal reports that are reviewed and used by the Board of Directors (chief operating decision makers) in assessing performance and determining the allocation of resources.

In identifying its operating segment, management follows the geographical location of the Group’s operations. Corporate costs are included under “Other”.

Types of products and services by segment

All segments provide the same type of products and services being the manufacture and sale of bottled water and filtration systems.

Basis of accounting for purposes of reporting by operating segments

(a) Accounting policies adopted

Unless stated otherwise, all amounts reported to the Board of Directors, being the chief decision maker with respect to operating segments, are determined in accordance with accounting policies that are consistent to those adopted in the annual financial statements of the Group.

(b) Intersegment transactions

There is no intersegment sale and corporate costs are not allocated. Corporate costs are classified under “Other” in the segment performance analysis.

(c) Segment assets

Segment assets are clearly identifiable on the basis of their nature and physical location.

(d) Segment liabilities

Liabilities are allocated to segments where there is a direct nexus between the incurrence of the liability and the operations of the segment. Borrowings and tax liabilities are generally considered to relate to the Group as a whole and are not allocated. Segment liabilities include trade and other payables and certain direct borrowings.

(e) Unallocated items

The following items of revenue, expenses, assets and liabilities are not allocated to operating segments as they not considered part of the core operations of any segment:

• impairment of assets and other non-recurring items of revenue or expense

• income tax expense

• corporate costs

• deferred tax assets and liabilities

• current tax liabilities

REFRESH GROUP LIMITED and its controlled entities 24

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

4. OPERATING SEGMENTS (cont)

(f) Segment performance

					OTHER
	WA	NSW	VIC	QLD	(Corporate)	TOTAL
30 June 2013
Revenue from external customers	3,325,745	1,375,542	743,718	1,439,592	-	6,884,597
Other Income	(2,133)	-	21,405	-	-	19,272
Interest Expense	37,253	-	-	-	19,778	57,031
Depreciation & Amortisation	165,452	52,547	36,310	44,494	-	298,803
Segment operating profit/(loss)	243,500	46,359	104,854	89,652	(559,656)	(75,291)
Total assets	1,832,345	881,636	500,269	1,302,042	163,686	4,679,978
Total liabilities	826,481	4,194	907	70,834	286,253	1,198,669
30 June 2012	,
Revenue from external customers	2,959,337	1,180,124	542,624	1,360,687	-	6,042,772
Other Income	(24,470)	1,027	-	-	-	(23,443)
Interest Expense	46,033	-	-	-	28,025	74,058
Depreciation & Amortisation	185,612	49,275	19,833	50,418	-	305,138
Segment operating profit/(loss)	268,720	23,912	15,845	82,850	(466,613)	(75,286)
Total assets	1,717,825	929,829	385,431	1,284,496	26,383	4,343,964
Total liabilities	700,460	4,849	1,319	77,687	379,538	1,163,853

5. ACQUISITIONS

On 3 August 2012, the Company acquired the assets relating to the distilled water business of Saradin Pty Ltd (Saradin). Saradin supplied distilled water for commercial and industrial use under the trading name “Distilled Water Supplier”. The acquisition allows Refresh to expand further into this market segment. The acquisition was settled in cash for a total consideration of $33,502 made up as follows:

Stocks Customer List Total	$ 3,502 30,000(refer to Note 14) 33,502

REFRESH GROUP LIMITED and its controlled entities 25

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

6. REVENUE AND EXPENSES

(a) Revenue Sale of bottled water and accessories (b)Employee benefits expense Wages and Salaries Workers’ compensation costs Defined contribution superannuation costs Provisions for Annual and Long Service Leave Other employee benefits expense (c) Finance income Interest received (d) Finance Costs Bank loans and other borrowings Finance charges payable under finance leases and hire purchase contracts (e) Cost of Sales Inventory expensed Inventory write-off (g) Depreciation & Amortisation Depreciation expense Amortisation	CONSOLIDATED 2013 2012 $ $
	6,884,597 6,042,772
	6,884,597 6,042,772
	2,248,762 1,989,464 42,699 45,528 223,923 198,559 32,088 12,081 43,802 57,764
	2,591,274 2,303,396
	5,577 186
	5,577 186
	74,214 84,414 5,908 7,916
	80,122 92,330
	2,821,796 2,208,567 48,123 64,450
	2,869,919 2,273,017
	293,302 316,824 5,500 151,653
	298,802 468,477

REFRESH GROUP LIMITED and its controlled entities 26

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

7. INCOME TAX

		CONSOLIDATED	CONSOLIDATED
		2013	2012
		$	$
The components of the tax expense(benefit)comprise:
	Current tax	-	-
	Deferred tax	-	-
	Accounting Profit before Tax	(75,291)	(75,286)
Prima facie tax payable on profit from ordinary activities before income tax at 30% (2012: 30%)
-	Income tax expense to accounting profit	(22,587)	(22,556)
Add:
Tax effect of:
-	Non-deductible expenses	11,816	3,436
-	Other assessable items	-	-
-	Deferred tax assets not brought to account	10,771	19,120
	Income tax expense (benefit) attributable to entity	-	-
	Unrecognised deferred tax balances
	The following deferred tax assets and liabilities
	have not been brought to account:
	Unrecognised deferred tax asset losses	1,204,483	1,219,904
	Unrecognised deferred tax assets other	110,765	99,532
	Unrecognised deferred tax liabilities	(193,467)	(212,543)
		1,121,781	1,106,893

Tax consolidation

Refresh Group Limited and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under tax consolidation legislation. Each entity in the Group recognises its own current and deferred tax - assets and liabilities. Such taxes are measured using the “stand alone taxpayer” approach to allocation. Current tax liabilities (assets) and deferred tax assets arising from unused tax losses and tax credits in the subsidiaries are immediately transferred to the head entity. The Group notified the Australian Tax Office that it had formed an income tax consolidated group to apply from 1 July 2005. The tax consolidated group has agreed that differences between the amounts of net tax assets and liabilities derecognised and the net amounts recognised are recognised as either a contribution by, or distribution to the head entity. The head entity is Refresh Group Limited.

REFRESH GROUP LIMITED and its controlled entities 27

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

8. EARNINGS PER SHARE

Basic earnings per share amounts are calculated by dividing net loss for the year attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the year.

Diluted earnings per share amounts are calculated by dividing the net loss attributable to ordinary shareholders (after deducting interest on the convertible redeemable preference shares) by the weighted average number of ordinary shares outstanding during the year (adjusted for the effects of dilutive options and dilutive convertible non-cumulative redeemable preference shares).

The following reflects the loss and share data used in the total operations basic and diluted loss per share computations:

Loss attributable to equity holders of the parent Weighted average number of ordinary shares for basic earnings per share Basic/diluted loss per share (cents per share) Basic loss per shares Diluted loss per shares	CONSOLIDATED 2013 $ 2012 $
	(75,291) (75,286) 98,328,924 86,046,065 (0.077) (0.087) (0.077) (0.087)

There have been no other transactions involving ordinary shares or potential ordinary shares since the reporting date and before the completion of these financial statements.

9. DIVIDENDS PAID AND PROPOSED

No dividend has been paid or declared for the year ended 30 June 2013. No dividend was paid in the previous year.

10. CASH AND CASH EQUIVALENTS

Cash at bank and in hand Cash at bank and in hand earns interest at floating rates based on Reconciliation from the net profit / (loss) after tax to the net cash flows from operations Net (Loss) after income tax Adjustments for: Depreciation expense Net (profit)/loss on disposal of property, plant and equipment Employee shares / options expensed Reversal of prior year impairment Amortisation expense Changes in assets and liabilities (Increase)/decrease in inventories (Increase)/decrease in trade and other receivables (decrease)/increase in trade and other payables (decrease)/increase in short-term provisions Net cash provided by /used in operating activities

CONSOLIDATED 2013 2012 $ $ 224,194 152,542 daily bank rates. -75,291 (75,286) 293,302 316,824 -19,272 23,443 - 12,837 -21,407 5,500 -97,195 94,861 -156,678 (89,898) 141,826 (148,929) 54,413 (497)

125,198 133,355

REFRESH GROUP LIMITED and its controlled entities 28

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

11. TRADE AND OTHER RECEIVABLES

				CONSOLIDATED	CONSOLIDATED
				2013	2012
Current				$	$
Trade receivables				615,720	533,528
Provision for impairment of receivables				(15,000)	(18,000)
				600,720	515,528
Other receivables				99,495	58,329
Prepayments				88,699	59,364
				788,914	633,221
		Past due
	Gross	and	Past due but not impaired		Within initial
	Amount	impaired	(days overdue)		trade terms
			31-60	61-90 >90
Consolidated
2013
Trade receivables	615,720	15,000	215,266	23,401	- 362,053
Other receivables	99,495	-	4,249	- 83,365 11,881
	715,215	15,000	219,515	23,401 83,365 373,934
2012
Trade receivables	533,528	18,000	195,025	35,181 5,068 280,254
Other receivables	58,329	-	1,066	- 44,027 13,236
	591,857	18,000	196,091	35,181 49,095 293,490

All of the Group’s trade and other receivables have been reviewed for indications of impairment. None of the trade receivables were required to be impaired.

12. INVENTORIES

Raw materials (at cost) Finished goods (at cost) Total inventories at lower of cost or net realisable value Provision for slow moving Inventories	CONSOLIDATED 2013 2012 $ $
	475,032 425,819 560,211 512,229
	1,035,243 938,048 (70,035) (70,035)
	965,208 868,013

REFRESH GROUP LIMITED and its controlled entities 29

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

13. PROPERTY, PLANT AND EQUIPMENT

Cost Opening Balance 1 July 12 Additions Disposals Reversal of Impairment Closing balance 30 June 13 Accumulated Depreciation Opening balance 1 July 12 Charge for the year Depreciation on disposals Closing Balance 30 June 13 Net Book Value Opening balance 1 July 12 Closing balance 30 June 13	Plant & Equipment Furniture & Fittings Office Equipment Motor Vehicle Pallets Equipment Leased Provision of FA Impairment Total 2,038,940 335,341 153,463 517,985 307,719 298,585 (21,407) 3,630,626 201,098 10,031 7,647 39,582 40,376 (7,410) - 291,324 (22,556) (44,567) (29,805) (38,399) (135,327) - - - - - - 21,407 21,407
	2,217,482 345,372 116,543 527,762 309,696 291,175 - 3,808,030
	(848,884) (156,344) (104,854) (244,591) (174,384) (167,799) - (1,696,856) (125,563) (29,370) (24,935) (56,651) (28,699) (28,084) - (293,302) 4,376 - 44,567 21,716 31,316 - - 101,975
	(970,071) (185,714) (85,222) (279,526) (171,767) (195,883) - (1,888,183)
	1,190,056 178,997 48,609 273,394 133,335 130,786 (21,407) 1,933,770
	1,247,411 159,658 31,321 248,236 137,929 95,292 - 1,919,847

The carrying value of plant and equipment held under finance leases and hire purchase contracts at 30 June 2013 is $46,550 (2012: $65,580). Leased assets and assets under hire purchase contracts are pledged as security for the related finance lease and hire purchase liabilities.

REFRESH GROUP LIMITED and its controlled entities 30

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

13. PROPERTY, PLANT AND EQUIPMENT (cont)

Cost Opening Balance 1 July 11 Additions Disposals Impairment Closing balance 30 June 12 Accumulated Depreciation Opening balance 1 July 11 Charge for the year Depreciation on disposals Closing Balance 30 June 12 Net Book Value Opening balance 1 July 11 Closing balance 30 June 12	Plant & Equipment Furniture & Fittings Office Equipment Motor Vehicle Pallets Equipment Leased Provision of FA Impairment Total 2,027,639 329,236 139,615 504,961 302,415 304,340 (33,091) 3,575,115 30,648 6,105 22,898 43,044 6,313 22,850 - 131,858 (19,347) - (9,050) (30,020) (1,009) (28,605) - (88,031) - - - - - - 11,684 11,684
	2,038,940 335,341 153,463 517,985 307,719 298,585 (21,407) 3,630,626
	(721,386) (127,646) (80,772) (193,159) (146,490) (164,639) - (1,434,092) (132,577) (28,698) (25,771) (69,183) (28,830) (31,765) - (316,824) 5,079 - 1,689 17,751 936 28,605 - 54,060
	(848,884) (156,344) (104,854) (244,591) (174,384) (167,799) - 1,696,856
	1,306,253 201,590 58,843 311,802 155,925 139,701 (33,091) 2,141,023
	1,190,056 178,997 48,609 273,394 133,335 130,786 (21,,407) 1,933,770

14. INTANGIBLE ASSETS

At 1 July 2012 Additions Amortisation At 30 June 2013	CONSOLIDATED Goodwill Customer List Trademarks Total
	$ $ $ $ 752,052 - 4,363 756,415 - 30,000 900 30,900 - (5,500) - (5,500)
	752,052 24,500 5,263 781,815

Trademarks relate to registered trademarks which have been purchased during business combinations.

The useful lives of these intangible assets were estimated as indefinite and the cost method was utilised for their measurement other than the customer list which has a definite life of 5 years amortisation is on a straight line basis.

As at 30 June 2013, these assets were tested for impairment (see Note 15).

REFRESH GROUP LIMITED and its controlled entities 31

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

15. IMPAIRMENT TESTING OF GOODWILL, OTHER INTANGIBLE ASSETS AND PROPERTY, PLANT AND EQUIPMENT

For impairment assessment purposes, assets are grouped at the lowest levels for which there are largely independent cash inflows (cash-generating units). As a result, some assets are tested individually for impairment and some are tested at cash-generating unit (CGU) level. Goodwill is allocated to those CGU’s that are expected to benefit from synergies of the related business combination and represent the lowest level within the Group at which management monitors goodwill.

CGU’s to which goodwill has been allocated (determined by the Group’s management as equivalent to its operating segments) are tested for impairment at least annually. All other individual assets or CGU’s are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

Impairment losses for CGU’s reduce first the carrying amount of any goodwill allocated to that CGU. Any remaining impairment loss is charged pro rata to the other assets in the CGU. With the exception of goodwill, all assets are subsequently reassessed for indications that an impairment loss previously recognized may no longer exist. An impairment charge is reversed if the CGU’s recoverable amount exceeds its carrying amount.

An impairment loss is recognised for the amount by which the assets or CGU’s carrying amount exceeds its recoverable amount, which is the higher of fair value less costs to sell and value-in-use. To determine the valuein-use, management estimates expected future cash flows from each CGU and determines a suitable interest rate in order to calculate the present value of those cash flows. The data used for impairment testing procedures are directly linked to the Group’s latest approved budget, adjusted as necessary to exclude the effects of futures reorganisations and asset enhancements. Discount factors are determined individually for each cash-generating unit and reflect management’s assessment of respective risk profiles, such as market and asset-specific risks factors .To determine fair value less costs to sell, management needs to identify a comparable transaction or provide a market for the transaction for fair value to be assessed. AASB 136 provides that management can choose either method to provide the highest value. For this reason, the Group has calculated the value-in-use for Perth, Toowoomba and Hydr8 Water. Fair value less costs to sell has been used for the Sydney and Brisbane CGU’s. Fair value was determined from the recent offer made by Saisan Co Ltd – a Japanese company with a bottled water division that is seeking to expand outside Japan.

Refresh Waters Perth cash-generating unit

The carrying amount of goodwill for this generating unit is $41,461. The recoverable amount of the Perth cashgenerating unit has been determined based on a value-in-use calculation.

The cash flow projections are based on financial budgets approved by senior management covering a five-year period. The discount rate applied to cash flow projections is 13%.Cashflows beyond 5 years of forecast are assumed to have no growth therefore the long term growth has been set at 0%.

The Board anticipates growth in revenue of around 7% for each of the next 5 years, with a net profit margin before tax of 15% for Perth.

Management believes that any reasonably possible change in the key assumptions on which Perth’s recoverable amount is based would not cause Perth’s carrying amount to exceed its recoverable amount

Management has based the value-in-use calculations on budgets for the CGU. These budgets use historical weighted average growth rates to project revenue. Costs are calculated taking into account historical gross margins as well as estimated weighted average inflation rates over the period, which are consistent with inflation rates applicable to the locations in which the segments operate. Discount rates are pre-tax and are adjusted to incorporate risks associated with a particular segment.

Refresh Waters Sydney cash-generating unit

The carrying amount of goodwill for this generating unit is $113,182, including goodwill of Moores. The recoverable amount of Sydney cash-generating unit has been determined based on fair value.

Management has based the fair value calculations on an offer received from Saisan Co Ltd.

REFRESH GROUP LIMITED and its controlled entities 32

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

15. IMPAIRMENT TESTING OF GOODWILL, OTHER INTANGIBLE ASSETS AND PROPERTY, PLANT AND EQUIPMENT (cont)

Refresh Waters Melbourne cash-generating unit

Melbourne purchased a customer list which has a carrying value of $30,000. This will be amortised over 5 years. For year ending 30 June 2013, a charge of $5,500 was recognised. The Group also assessed the customer list for impairment using the value-in-use method.

Refresh Waters Brisbane cash generating-unit

The carrying amount of goodwill for this generating unit is $292,528, including goodwill of Moores. The recoverable amount of the Brisbane cash-generating unit has been determined based on fair value.

Management has based the fair value calculations on an offer received from Saisan Co Ltd.

Refresh Waters Toowoomba cash-generating unit

The carrying amount of goodwill for this generating unit is $164,308.The recoverable amount of the Toowoomba cash-generating unit has been determined based on a value-in-use calculation.

The cash flow projections are based on financial budgets approved by senior management covering a five-year period. The discount rate applied to cash flow projections is 13%. Cash flows beyond 5 years of forecast are assumed to have no growth therefore the long term growth has been set at 0%.

The Board anticipates growth in revenue of approximately 5% for the next 5 years, with a net profit margin of 14% for Toowoomba.

Management believes that any reasonably possible change in the key assumptions on which Toowoomba’s recoverable amount is based would not cause Toowoomba’s carrying amount to exceed its recoverable amount.

Management has based the value-in-use calculations on budgets for the CGU. These budgets use historical weighted average growth rates to project revenue. Costs are calculated taking into account historical gross margins as well as estimated weighted average inflation rates over the period, which are consistent with inflation rates applicable to the locations in which the segments operate. Discount rates are pre-tax and are adjusted to incorporate risks associated with a particular segment.

Hydr8 Water cash-generating unit

The carrying amount of goodwill for this cash-generating unit is $140,572. The recoverable amount of Hydr8 has also been determined based on a value-in-use calculation.

The cash flow projections are based on financial budgets approved by senior management covering a five-year period. The discount rate applied to cash flow projections is 13%. Cash flows beyond 5 years of forecast are assumed to have no growth therefore the long term growth has been set at 0%.

The Board anticipates growth in revenue of approximately 7% for the next 5 years, with a net profit margin of 25%

for Hydr8.

Management believes that any reasonably possible change in the key assumptions on which Hydr8’s recoverable amount is based would not causes Hydr8’s carrying amount to exceed its recoverable amount

Management has based the value-in-use calculations on budgets for the CGU.. These budgets use historical weighted average growth rates to project revenue. Costs are calculated taking into account historical gross margins as well as estimated weighted average inflation rates over the period, which are consistent with inflation rates applicable to the locations in which the segments operate. Discount rates are pre-tax and are adjusted to incorporate risks associated with a particular segment.

REFRESH GROUP LIMITED and its controlled entities 33

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

16. TRADE AND OTHER PAYABLES

Current Trade payables Other payables	CONSOLIDATED 2013 2012 $ $
	324,564 232,133 355,790 306,395
	680,354 538,528

Trade payables are non-interest bearing and are normally settled on 60-day terms.

17. FINANCIAL LIABILITIES

Current Obligations under finance leases and hire purchase contracts (Note 22) Short term related party loans Non-current Obligations under finance leases and hire purchase contracts (Note 22)	Effective interest rate Maturity	CONSOLIDATED 2013 2012 $ $
	9.9-10.7% < 1 year 12-20% < 1 year 9.9-10.7% 1–5 years	21,098 19,030 270,000 390,000
		291,098 409,030
		25,452 46,550
		25,452 46,550

18. PROVISIONS AND ACCRUALS

Short term provisions Annual Leave Long Service Leave Accruals Long term provisions Long Service Leave	CONSOLIDATED 2013 2012 $ $
	94,415 87,527 42,210 - 38,065 32,750
	174,690 120,277
	27,075 49,468

Provision for Long-term Employee Benefits

A provision has been recognised for employee entitlements relating to long service leave. In calculating the value of long service leave, the probability of long service leave being taken is based on historical data. The measurement and recognition criteria relating to employee benefits have been included in Note 3.7 in this report.

REFRESH GROUP LIMITED and its controlled entities 34

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

19. ISSUED CAPITAL AND RESERVES

The share capital of Refresh consists only of fully paid ordinary shares. These shares have no par value.

Ordinary Shares Issued and fully paid Fund raising costs Movement in ordinary shares At 30 June 2011 No share issued from 1 July 2011 to 30 June 2012 At 30 June 2012 Issued shares to Australian Glamour Pty Ltd on 11/7/12 Issued shares to directors in lieu fees on 12/7/12 Fund raising costs At 30 June 2013	No.	CONSOLIDATED 2013 2012 $ $
		8,786,495 8,946,150 (3,411) (539,555)
		8,783,084 8,406,595
		$ 8,406,595 - 8,406,595 300,000 79,900 (3,411) 8,783,084
	86,046,065 -
	86,046,065 10,000,000 2,282,859 -
	98,328,924

Details of the balance of and movements in reserves can be found in the Statement of Changes in Equity.

Capital management

The capital of the Group is managed in order to maintain a good debt to equity ratio, provide the shareholders with adequate returns and ensure that the group can fund its operations and continue as a going concern.

The Group’s capital includes ordinary share capital and financial liabilities.

There are no externally imposed capital requirements.

Capital is managed by assessing the Group’s financial risks and adjusting its capital structure in response to changes in these risks and the market. These responses include the management of debt levels, and share issues.

There has been no change in the strategy adopted by management to control the capital of the Group since the prior year.

Nature and purpose of reserves

Employee equity benefits reserve

The employee share option and share plan reserve is used to record the value of equity benefits provided to employees and directors as part of their remuneration. Refer to Note 25 for further details of these plans.

Transactions in the year Nil Amount of reserve $191,712

20. FINANCIAL RISK MANAGEMENT

The Board reviews and agrees on policies for managing risks and they are summarised below.

Interest Rate Risk

The main risk the Group is exposed to through its financial instruments is interest rate risk. The Group’s policy is to manage its risk using a mix of fixed and variable rate debt.

Note 21 Financial Instruments sets out the carrying amount, by maturity, of the financial instruments that are exposed to interest rate risk.

REFRESH GROUP LIMITED and its controlled entities 35

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

20. FINANCIAL RISK MANAGEMENT (cont)

Foreign Currency and Price Risk

Foreign currency fluctuation does not affect the Group’s income as almost all our sales are within Australia. However, it does affect the price of raw materials and in turn, the final price of our purchases.

Credit Risk

The Group trades only with recognised, creditworthy third parties. It is the Group policy that customers who wish to trade on credit terms are subject to credit verification procedures.

In addition, receivable balances are monitored on an ongoing basis with the result that the Group’s exposure to bad debts is not significant.

Liquidity Risk

The Group manages liquidity risk by monitoring forecast cash flows and ensuring that adequate cash reserves are maintained. A cash and commitment report forms part of the monthly management reports forwarded to the Board.

21. FINANCIAL INSTRUMENTS

The Group’s principal financial instruments comprise finance leases and hire purchase contracts, cash and shortterm deposits. The main purpose of these financial instruments is to raise finance for Group operations.

The Group has various other financial instruments such as trade debtors and trade creditors, which arise directly from its operations.

Fair values

The carrying amount of financial assets and financial liabilities recorded in the financial statements approximates their net fair values. The net fair values of financial assets and liabilities are determined as follows:

• The net fair value of financial assets and financial liabilities with standard terms and conditions and traded on active liquid markets are determined with reference to quoted market prices; and

• The net fair value of other financial assets and financial liabilities are determined in accordance with generally accepted pricing models based on discounted cash flow theory.

Liquidity risk analysis

Liquidity risk is the risk that the Group might be unable to meet its obligations. The Group manages its liquidity needs by monitoring scheduled debt servicing payments for long–term financial liabilities as well as forecast inflows and outflows due in day-to-day business.

Year ended 30 June 2013 CONSOLIDATED Financial Assets Cash assets Loans and Receivables Financial Liabilities At amortised cost Loans and Payables Hire purchase liability	Floating Interest Rate Fixed Interest Rate	Maturity Non- Interest Bearing Total < 1 year 2 to 5 years $ $ $ $
	2–5.2% - - - - 12-20% - 9.9-10.7%	224,194 - - 224,194 - - 700,215 700,215
		224,194 - 700,215 924,409
		270,000 - 674,526 944,526 21,098 25,452 - 46,550
		291,098 25,452 674,526 991,076

REFRESH GROUP LIMITED and its controlled entities 36

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

21. FINANCIAL INSTRUMENTS (cont)

Year ended 30 June 2012 CONSOLIDATED Financial Assets Cash assets Loans and Receivables Financial Liabilities At amortised cost Loans and Payables Hire purchase liability	Floating Interest Rate Fixed Interest Rate	Maturity Non- Interest Bearing Total < 1 year 2 to 5 years $ $ $ $
	2–5.2% - - - - 12-20% - 8.7-10.7%	152,542 - - 152,542 - - 573,857 573,857
		152,542 - 573,857 726,399
		390,000 - 538,528 928,528 19,030 46,550 - 65,580
		409,030 46,550 538,528 994,108

Net Fair Values

The net fair values of other assets and other liabilities approximate their carrying value.

No financial assets and financial liabilities are readily traded on organised markets in standardised form.

Financial assets where the carrying amount exceeds net fair value have not been written down as the Group intends to hold these assets to maturity.

Sensitivity Analysis

The Group has no borrowing other than 2 fixed-rate hire purchases and as such, changes in interest rate will have insignificant effect on its profit or equity. Interest rate movements on cash balances would not be material.

As almost all revenue is derived from Australia, foreign currency fluctuation has minimal effect on its profit or equity.

22. COMMITMENTS

Operating lease commitments

The Group has entered into commercial leases where it is not in the best interest of the Group to purchase these assets.

Location	Expiry	Lease Terms
Brisbane	31/03/18	taken up 5-year option
Kalgoorlie	01/07/14	taken up 2-year option
Melbourne	16/02/15	taken up 2-year option
Perth	30/06/16	7 + 3 + 3 years
Sydney	1/05/15	3 + 3 years
Toowoomba		no fixed lease

Renewal terms are included in the contracts. Renewals are at the option of the specific entity that holds the lease.

There are no restrictions placed upon the lessee by entering into these leases.

Future minimum rentals payable under non-cancellable operating leases as at 30 June are as follows:

REFRESH GROUP LIMITED and its controlled entities 37

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

22. COMMITMENTS (cont)

Within one year After one year but not more than five years	CONSOLIDATED 2013 2012 $ $
	396,737 325,856 514,420 191,630
	911,157 517,486

Finance lease and hire purchase commitments

The Group has finance leases and hire purchase contracts for various items of plant and machinery. These leases have no terms of renewal or purchase options and escalation clauses.

Future minimum lease payments under finance leases and hire purchase contracts together with the present value of the net minimum lease payments are as follows:

CONSOLIDATED Within one year After one year but not more than five years Total minimum lease payments Less amounts representing finance charges Present value of minimum lease payments	2013 2012 Minimum payments Minimum payments $ $
	24,938 24,938 27,017 51,955
	51,955 76,893 (5,405) (11,313)
	46,550 65,580

23. RELATED PARTY DISCLOSURES

The consolidated financial statements include the financial statements of Refresh Group Limited and the subsidiaries listed in the following table.

Refresh Waters Pty Ltd Refresh Waters Queensland Pty Ltd	Country of incorporation % Equity interest Investment 2013 2012 2013 2012 $ $
	Australia 100% 100% 5,000,000 5,000,000 Australia 100% 100% 1,000,000 1,000,000

Refresh Group Limited is the ultimate Australian parent entity and ultimate parent of the Group.

Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this note.

Terms and conditions of transactions with related parties

Outstanding balances at year-end are unsecured and settlement occurs in cash.

There have been no guarantees provided or received for any related party receivables.

The Group has facilities from related parties through a short term loan and an unsecured revolving line of credit amounting to $300,000 with a fixed interest rate of 12% pa. During the period there was no borrowing (2012: $82,000). A total of $120,000 was repaid (2012: $20,000). At 30 June 2013 amount payable under the loan facility was $60,000 (2012: $140,000). This has been repaid as at the date of this report. The amount outstanding on the line of credit was $210,000 (2012: $250,000) and $90,000 of the revolving line of credit was unused (2012: $50,000).

REFRESH GROUP LIMITED and its controlled entities 38

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

24. AUDITORS’ REMUNERATION

Remuneration of the auditor of the parent entity for: • audit and review of the financial reports • other services (a) tax compliance (b) advisory Remuneration of related practices of the parent entity auditor for : • Audit Protection Service Total	CONSOLIDATED 2013 2012 $ $
	63,300 61,000 10,000 11,000 2,300 -
	75,600 72,000 1,564 1,136
	77,164 73,136

25. EMPLOYEE BENEFITS

(a) Directors’ and Executives’ Option Scheme

On 31 October 2005, the shareholders of Refresh Group Limited resolved to approve the creation of the Directors and Executives Option Scheme (DEOS).

The purpose of the DEOS is to align the interests of the directors and key management of Refresh by providing a cost-effective and efficient long-term incentive to them which is linked to the performance of the company. By rewarding executives with the issue of options, Refresh will be able to reward them without having to commit cash resources to do so.

Under the DEOS, directors and key management personnel of Refresh are eligible to be issued with options to acquire unissued ordinary fully paid shares in Refresh. The options will be issued for no consideration. They have an exercise period of one year.

During the financial year, no option was granted as equity compensation benefits under the DEOS.

(b) Employee Share Scheme

On 31 October 2005, the shareholders of Refresh Group Limited approved the creation of an Employee Share Scheme (ESS).

The purpose of the ESS is to reward current and future employees of the Group in a way which gives the employees an opportunity to share in the future growth and profitability of Refresh.

Employees were eligible for a loan from the Company in order to finance the purchase of shares. The loan is an interest-free loan with a maximum term of two years. Repayments are being made through deductions from the employee’s salary. The Directors of Refresh invited employees to participate in the ESS based on factors such as their length of service, grade or position in Refresh. New employees will be eligible to join the ESS after one year’s continuous service.

Should an employee leave his or her employment without having fully repaid the loan, Refresh may sell that employee’s shares and apply the proceeds to the cost of the sale and the repayment of the loan. The balance (if any) will be returned to the employee. There are mechanics in place to ensure that shares acquired pursuant to a loan from Refresh are not transferred until the loan has been repaid.

The above is a summary of the terms of the ESS. A copy of the ESS rules is available for inspection at the Head Office of Refresh.

During the financial year, no share was issued under the ESS.

REFRESH GROUP LIMITED and its controlled entities 39

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

26. DIRECTORS’ AND KEY MANAGEMENT PERSONNEL DISCLOSURE

In accordance with S300A of the Corporation Act, remuneration disclosures related to key management personnel are included in the Remuneration Report (i) in the Director’s Report.

(a) Remuneration options: Granted and vested during the year

During the financial year, no options were granted as equity compensation benefits under the Directors and Executives Option Scheme.

(b) Option holdings of Directors and Key Management Personnel

There is no outstanding option as at 30 June 2013.

(c) Shareholdings of Directors and Key Management Personnel

Shares held in Refresh Group Limited as at 30 June 2013

	Balance	Granted as	Other Net	Balance
	01 Jul 12	Remuneration	Changes *	30 Jun 13
	Ord	Ord	Ord	Ord
Directors
Mr H Heng	10,854,709	-	-	10,854,709
Mr M Y Chan	-	1,041,779	-	1,041,779
Ms Jamie Khoo	-	832,330	-	832,330
Other Key Management	Personnel
Mr B Bolton	142,500	-	-	142,500
Mr H Ho	99,000	-	-	99,000
Total	11,096,209	1,874,109	-	12,970,318

* Relate to general sales and purchases made on the open market, including subscription for the rights issue

All equity transactions with directors other than those arising from the exercise of remuneration options have been entered into under terms and conditions no more favourable than those the entity would have adopted if dealing at arm’s length.

Shares held in Refresh Group Limited as at 30 June 2012

	Balance	Granted as	Other Net	Balance
	01 Jul 11	Remuneration	**Changes ***	30 Jun 12
	Ord	Ord	Ord	Ord
Directors
Mr H Heng	10,512,909	-	341,800	10,854,709
Mr E Teo	7,994,900	-	201,800	8,196,700
Other Key Management	Personnel
Ms M Tan	-	-	200,000	200,000
Mr B Bolton	142,500	-	-	142,500
Mr H Ho	99,000	-	-	99,000
Total	18,749,309		743,600	19,492,909

* Relate to general sales and purchases made on the open market, including subscription for the rights issue

(d) Loans to Directors and Key Management Personnel

Except for the approved instalment plan under its ESS, no director or key management personnel has received any loan from Refresh Group Limited or any of its controlled entities.

REFRESH GROUP LIMITED and its controlled entities 40

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

27. EVENTS AFTER THE BALANCE SHEET DATE

The Group is in the final stage of negotiations with Saisan Co Ltd (Saisan), to sell a 51% stake in its wholly-owned subsidiary, Refresh Waters Queensland Pty Ltd (Queensland). Refresh will continue to manage the Queensland operations after the sale.

Saisan was established in 1945 and is presently a leading supplier of bottled gas in Japan. Its gas business has expanded internationally to China, Mongolia and Vietnam. It has also diversified into bottled water and is looking into expanding its bottled water business. In the last financial year, its revenue was $585 million with operating profit of $23 million.

28. PARENT ENTITY

(a) Statement of Financial Position

ASSETS Current Assets Cash and cash equivalents Trade and other receivables Total Current Assets Non-Current Assets Other financial assets Total Non-Current assets TOTAL ASSETS LIABILITIES Current Liabilities Trade and other payables Financial liabilities Short-term provisions and accruals Total Current Liabilities Non-Current Liabilities Long-term provisions Total Non-Current Liabilities TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Reserves Accumulated losses TOTAL EQUITY	Parent 2013 2012 $ $
	147,610 7,100 16,075 19,284
	163,685 26,384
	2,017,696 2,421,450
	2,017,696 2,421,450
	2,181,381 2,447,834
	136,298 150,761 60,000 140,000 96,633 49,239
	292,931 340,000
	3,320 39,538
	3,320 39,538
	296,251 379,538
	1,885,130 2,068,296
	8,783,084 8,406,595 191,713 191,712 (7,089,667) (6,530,011)
	1,885,130 2,068,296

The parent entity has not entered into a deed of cross guarantee nor are there any contingent liabilities at the year end. There are no contractual commitments by the parent for the acquisition of PPE.

REFRESH GROUP LIMITED and its controlled entities 41

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2013

28. PARENT ENTITY (cont)

(b) Financial performance

b) Financial performance
Loss for the year Other comprehensive income, net of tax Total comprehensive income	Parent 2013 2012 $ $
	(559,655) (466,614) - -
	(559,655) (466,614)

REFRESH GROUP LIMITED and its controlled entities 42

DIRECTORS DECLARATION

In accordance with a resolution of the Directors of Refresh Group Limited, I state that:

In the opinion of the Directors:

• (a) the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001, including:

• (i) giving a true and fair view of the consolidated entity's financial position as at 30 June 2013

• (ii) and of its performance for the year ended on that date; and

• (iii) complying with Accounting Standards and Corporations Regulations 2001; and

• (iv) the remuneration disclose within the Remuneration Report comply with S300A Corporation Act; and

• (b) the Chief Executive Officer and acting Chief Financial Officer have declared that

• (i) the financial records of the Group for the financial year have been properly maintained in accordance with section 286 of the Corporations Act 2001;

• (ii) the financial statements and associated notes comply in all material respects with the Australian Accounting Standards as required by Section 296 of the Corporations Act 2001 and

• (iii) the financial statements and associated notes give a true and fair view, in all material respect, of the financial position as at 31 June 2013 and performance of the Group and consolidated entity for the year then ended as required by Section 297 of the Corporations Act 2001.

• (c) the financial report also complies with International Financial Reporting Standards as disclosed in Note 3.1.

• (d) there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable.

On behalf of the Board

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Henry Heng Managing Director Perth, 27 September 2013

REFRESH GROUP LIMITED and its controlled entities 43

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Independent Auditor’s Report To the Members of Refresh Group Limited

10 Kings Park Road West Perth WA 6005 PO Box 570 West Perth WA 6872 T +61 8 9480 2000 F +61 8 9322 7787 E info.wa@au.gt.com W www.grantthornton.com.au

Report on the financial report

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

Directors’ responsibility for the financial report

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

Auditor’s responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error.

Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.

44

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

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

Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.

Auditor’s opinion

In our opinion:

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

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

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

• b the financial report also complies with International Financial Reporting Standards as disclosed in the notes to the financial statements.

Material uncertainty regarding continuation as a going concern

Without qualifying our opinion, we draw attention to Note 3.21 in the financial report which indicates that the consolidated entity incurred a net loss of $75,291 during the year ended 30 June 2013 and, as of that date, the consolidated entity’s cash inflows from operations was $125,198. These conditions, along with other matters as set forth in Note 3.21, indicate the existence of a material uncertainty which may cast significant doubt about the entity’s ability to continue as a going concern and therefore, the entity may be unable to realise its assets and discharge its liabilities in the normal course of business, and at the amounts stated in the financial report.

Report on the remuneration report

We have audited the remuneration report included in pages 5 to 9 of the directors’ report for the year ended 30 June 2013. The Directors of the Company are responsible for the preparation and presentation of the remuneration report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the remuneration report, based on our audit conducted in accordance with Australian Auditing Standards.

45

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Auditor’s opinion on the remuneration report

In our opinion, the remuneration report of Refresh Group Limited for the year ended 30 June 2013, complies with section 300A of the Corporations Act 2001.

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GRANT THORNTON AUDIT PTY LTD Chartered Accountants

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C A Becker Partner - Audit & Assurance

Perth, 27 September 2013

46

CORPORATE GOVERNANCE STATEMENT

The Board is committed to achieving and demonstrating the highest standards of corporate governance. As such, Refresh and its controlled entities have adopted a corporate governance framework and practices to ensure they meet the interests of shareholders.

Refresh complies with the Australian Securities Exchange Corporate Governance Council’s Corporate Governance Principles and Recommendations 2nd Edition (‘the ASX Principles’). This statement incorporates the disclosures required by the ASX Principles under the headings of the eight core principles. All of these practices, unless otherwise stated, were in place for the full reporting period.

Further information on the Group’s corporate governance policies and practices can be found on Refresh website at www.refreshgroup.com.au.

Board Composition

The skills, experience and expertise relevant to the position of each director who is in office at the date of the annual report and their term of office are detailed in the directors’ report.

The independent director of the company is Jamie Khoo.

When determining whether a non-executive director is independent the director must not fail any of the following materiality thresholds:

• less than 10% company shares are held by the director and any entity or individual directly or indirectly associated with the director.

• no sales are made to or purchases made from any entity or individual directly or indirectly associated with the director; and

• none of the directors’ income or the income of an individual or entity directly or indirectly associated with the director is derived from a contract with any member of the economic entity other than income derived as a director of the entity.

Independent directors have the right to seek independent professional advice in the furtherance of their duties as directors at the Company’s expense. Written approval must be obtained from the chair prior to incurring any expense on behalf of the Company.

The Board has considered the need for a Nominations Committee and believes that it is more appropriate for such responsibilities to be met by the full Board rather than a separate committee.

Ethical Standards

The Board acknowledges and emphasises the importance of all directors and employees maintaining the highest standards of corporate governance practice and ethical conduct.

A code of conduct has been established requiring directors and employees:

• act honestly and in good faith;

• exercise due care and diligence in fulfilling the functions of office;

• avoid conflicts and make full disclosure of any possible conflict of interest;

• comply with the law;

• encourage the reporting and investigating of unlawful and unethical behaviour; and

• comply with the share trading policy outlined in the Code of Conduct.

Directors are obliged to be independent in judgement and ensure all reasonable steps are taken to ensure due care is taken by the Board in making sound decisions.

Trading Policy

The Group has established a share trading policy which governs the trading in the Group’s shares and applies to all Directors and employees of the Group. Details of the Company’s Trading Policy are posted on its website: www.refreshgroup.com.au.

Anyone who has material non-public information cannot buy or sell Company shares, even during a period when trading is otherwise permitted.

A restricted person is not permitted to trade in Company shares during the following periods:

a. Two weeks prior to the release of the following reports:

• i. Half Year Report

• ii. Annual Financial Report

• b. Any time the restricted person is in possession of material information until after release of the information to

• ASX or termination of negotiation or event.

REFRESH GROUP LIMITED and its controlled entities 47

CORPORATE GOVERNANCE STATEMENT

Diversity Policy

Diversity includes, but is not limited to, gender, age, ethnicity and cultural background. The Company is committed to diversity and recognises the benefits arising from employee and board diversity and the importance of benefiting from all available talent. This diversity policy outlines the requirements for the Board to develop measurable objectives for achieving diversity, and annually assess both the objectives and the progress in achieving those objectives.

	No.	%
Women on the Board	1	33
Women in senior management roles	0	0
Women employees in the Company	20	29

Audit Committee

The names and qualifications of those appointed to the audit committee and their attendance at meetings of the committee are included in the Directors’ Report.

Performance Evaluation

Regular communication between directors and the Chairman is encouraged and an annual formal review of the requirements and performance of all directors is conducted. The performance of a director is continually monitored by the Chairman and peers.

• Board performance is reviewed by the full Board.

• The performance of the Chair is reviewed by other directors and the results discussed with the Chair by the elected lead director.

The performance of individual directors is reviewed by the Board and the results discussed with the respective Chair.

Board Roles and Responsibilities

The Board is first and foremost accountable to provide value to its shareholders through delivery of timely and balanced disclosures. The document on Board Charter and management delegations has been made public available on the company’s website: www.refreshgroup.com.au. This document details the adopted practices and processes in relation to matters reserved for the Board’s consideration and decision – making. The Board is ultimately responsible for ensuring its actions are in accordance with key corporate governance principles

Shareholder Rights

Shareholders are entitled to vote on significant matters impacting on the business, which include the election and remuneration of directors, changes to the constitution and receipt of the annual and interim financial statements. Shareholders are strongly encouraged to attend and participate in the Annual General Meetings of Refresh Group Limited, to lodge questions to be responded by the Board and /for the CEO, and are able to appoint proxies.

Risk Management

The Company's business strategies and activities involve risk. Risk is minimised to the extent it does not inhibit the Company or its controlled entities from pursuing its goals and objectives with a considered and balanced view of risk. A program has been commenced to identify, assess and manage risk in the context of the Company’s strategies, as well as regular assessment of the performance of the risk management system.

The Board is responsible for overseeing the risk management system and is the recipient of risk reporting from management. It is also responsible for approving the risk management policy, framework and risk tolerance of the Company. The responsibility for regular review of the risk management system has been delegated to the Audit Committee, which will conduct these reviews at least half-yearly.

Senior management are responsible for the establishment and implementation of a risk management system which will identify, assess and manage all material risks in the business. Through the executive management committee, a formal process is being developed to further improve the current system of risk management adopted in the operations of the Company. The executive management committee is also responsible for the reinforcement of a risk management culture throughout the Company.

The annual business plan for the Company considers key risks and the risk management strategies. This plan is prepared by management and approved by the Board at the commencement of each financial year. Regular reviews and assessment of performance against the plan is submitted by management to the Board.

The Company has implemented and documented a range of policies and procedures throughout the operations that provide a sound system of internal control. It also purchases insurance, where appropriate, as a means of risk transfer.

REFRESH GROUP LIMITED and its controlled entities 48

CORPORATE GOVERNANCE STATEMENT

Remuneration Policies

Details on remuneration policies for key management personnel are stated in the Directors’ Report.

Remuneration Committee

The names of the members of the remuneration committee and their attendance at meetings of the committee are detailed in the Directors’ Report

REFRESH GROUP LIMITED and its controlled entities 49

SHAREHOLDER INFORMATION

Shareholder information set out below was as at 27 September 2013

Distribution of Ordinary Shares

Range of Shares 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over Total Holders of less than a marketable parcel of ordinary shares	Total Holders 2 9 177 159 59
	406
	240

Voting Rights Attaching to Ordinary Shares

On a show of hands, every member present in person or by proxy shall have one vote. Upon a poll, each share shall have one vote.

On-Market Buy-Back

There is no on-market buy-back of its shares.

20 Largest Shareholders - Ordinary Shares

Name AUSTRALIAN GLAMOUR PTY LTD MR HENRY ENG CHYE HENG + MS SOK HWA NGOH HENG FAMILY A/C> MR ANTHONY GUAN CHEOW SOH HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED-GSCO ECA MR EDMUND SOON KIN TEO + MRS JANICE TEO FAMILY A/C> MR BOON KHENG ONG MS INN HOON JUDY ONG MS ING CHENG DIANA ONG MS MAY PHENG LEONG MR DJUANDA HADI MR ENG HUAT ONG MR YONG WEI POR MS WENYUN VENETIA SU MR MENG LEONG LYE DR CHEE SENG SEAH MR JUAN HUI GOH CITICORP NOMINEES PTY LIMITED MR HENRY ENG CHYE HENG + MR EDMUND SOON KIN TEO MR MUN YEW CHAN MR SAMUEL JACOB Total Top 20 Total Shares on Issue	Shares % 10,000,000 10.2 8,860,700 9.0 8,025,028 8.2 7,692,308 7.8 6,793,900 6.9 6,040,529 6.1 5,411,550 5.5 4,851,900 4.9 3,846,154 3.9 3,604,550 3.7 2,010,000 2.0 1,923,077 2.0 1,923,077 2.0 1,685,000 1.7 1,410,000 1.4 1,300,000 1.3 1,112,148 1.1 1,071,800 1.1 1,041,779 1.1 1,038,400 1.1
	79,641,900 81.0
	98,328,924

REFRESH GROUP LIMITED and its controlled entities 50

SHAREHOLDER INFORMATION

Substantial Shareholders - Ordinary Shares

	Shares	%
Mr Anthony Guan Cheow Soh	11,981,182	12.2%
Mr Henry Eng Chye Heng & Ms Sok Hwa Ngoh 10,119,439		10.3%
Australian Glamour Pty Ltd	10,000,000	10.2%
Mr Edmund Soon Kin Teo & Mrs Janice Teo	8,416,450	8.6%
HSBC Custody Nominees (Australia) Limited - GSCO ECA	7,692,308	7.8%
Ms Inn Hoon Judy Ong	6,711,550	6.8%
Ms Ing Cheng Diana Ong	6,261,900	6.4%
Mr Boon Kheng Ong	6,040,529	6.1%

REFRESH GROUP LIMITED and its controlled entities 51

CORPORATE DIRECTORY

BOARD OF DIRECTORS

Henry Heng Chairman and Managing Director Mun Yew Chan Non-Executive Director Jamie Khoo Independent, Non-Executive Director

COMPANY SECRETARY

Jamie Khoo

REGISTERED OFFICE AND HEAD OFFICE

17 Denninup Way MALAGA WA 6090 Telephone: (08) 9248 3006 Facsimile: (08) 9248 7233 Email: info@refreshgroup.com.au Website: www.refreshgroup.com.au

OTHER OPERATING LOCATIONS

New South Wales – Sydney

3 Salisbury Street SILVERWATER NSW 2128 Telephone: (02) 9748 4200 Facsimile: (02) 9748 4366 Email: sydney@refreshwater.com.au

Queensland – Brisbane

120 Mica Street CAROLE PARK QLD 4300 Telephone: (07) 3271 1251 Facsimile: (07) 3879 3019 Email: brisbane@refreshwater.com.au

Victoria - Melbourne

14 Bando Road SPRINGVALE VIC 3171 Telephone: (03) 9562 3877 Facsimile: (03) 9562 3177 Email: melbourne@refreshwater.com.au

Queensland – Toowoomba 600 Boundary Street TOOWOOMBA QLD 4350 Telephone: (07) 4659 0400 Facsimile: (07) 4659 0411 Email: toowoomba@refreshwater.com.au

Western Australia – Kalgoorlie

33/46 Great Eastern Highway KALGOORLIE WA 6430 Telephone: (08) 9022 2266 Facsimile: (08) 9022 4468 Email: kalgoorlie@refreshwater.com.au

AUDITOR

Grant Thornton Audit Pty Ltd Level 1, 10 Kings Park Road West Perth WA 6005

SHARE REGISTRY

Computershare Investor Services Level 2, 45 St Georges Terrace Perth WA 6000 Tel 1300 557 010

REFRESH GROUP LIMITED and its controlled entities 52

REFRESH GROUP LTD

ABN 28 079 681 244

17 Denninup Way, Malaga WA 6090 Tel: (08) 9248 3006 Fax: (08) 9248 7233 www.refreshgroup.com.au