FINDI LIMITED — Annual Report 2017

May 30, 2017

Transaction Solutions International Limited

ABN 98 057 335 672

- Appendix 4E Preliminary Final Report

1. The current reporting period is for the 12 months ended 31 March 2017 and the previous period is for the 12 months period ended 31 March 2016.

2. Results for announcement to the market.

	1 April 2016 to 31 March 2017	1 April 2015 to 31 March 2016	% Change
	$	$
2.1 Revenue from ordinary activities.	91,766	125,127	(27%)
2.2 Profit (loss) from ordinary activities after tax attributable to members.	(1,302,870)	(993,967)	(31%)
2.3 Net profit (loss) for the year attributable to members.	(1,297,250)	3,091,142	(142%)
2.4 Amount per security and franked amount per security of final and interim dividend.	No dividends have been paid or provided for during the year.
2.5 Record date for determining entitlements to the dividends and payment date.	Not applicable.
2.6 Brief explanation of any of the figures in 2.1 to 2.4 necessary to enable the figures to be understood.	Refer to the financial statements and the notes that follow in this report.

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3. Consolidated statement of profit and loss and other comprehensive income

		Year ended	Year ended
		31 March	31 March
		2017	2016
	Notes	$	$
Continuing operations
Finance income		51,685	49,585
Other income		40,081	75,542
		91,766	125,127
Employee benefits expense		(421,802)	(493,408)
Depreciation and amortisation expense		(1,067)	(2,420)
Share-based payment expense		(392,668)	(128,979)
Other expenses		(579,099)	(494,287)
Loss before tax		(1,302,870)	(993,967)
Income tax expense		-	-
Loss for the year from continuing operations		(1,302,870)	(993,967)
Other comprehensive income/(expense), net of
income tax – items that may subsequently be
reclassified to profit or loss
Foreign currency movement in translation of foreign
operations		5,620	4,790
Movement in fair value of available for sale assets	12	-	4,105,147
Merger reserve transferred from accumulated losses		-	(24,828)
Total comprehensive gain/(loss) for the year
attributable to members		(1,297,250)	3,091,142
Loss per share		Cents	Cents
From continuing operations
Basic loss per share		(0.07)	(0.06)
Diluted loss per share		(0.07)	(0.06)

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4. Consolidated statement of financial position

		31 March 2017	31 March 2016
	Notes	$	$
ASSETS
CURRENT ASSETS
Cash and cash equivalent		2,537,646	1,883,929
Trade and other receivables		44,217	41,566
Other assets		10,410	4,584
TOTAL CURRENT ASSETS		2,592,273	1,930,079
NON-CURRENT ASSETS
Available for sale financial assets	12	9,750,000	9,750,000
Property, plant and equipment		3,339	2,383
TOTAL NON-CURRENT ASSETS		9,753,339	9,752,383
TOTAL ASSETS		12,345,612	11,682,462
LIABILITIES
CURRENT LIABILITIES
Trade and other payables		114,139	125,197
TOTAL CURRENT LIABILITIES		114,139	125,197
TOTAL LIABILITIES		114,139	125,197
NET ASSETS		12,231,473	11,557,265
EQUITY
Contributed equity		34,179,407	32,654,210
Reserves		5,026,722	4,574,841
Accumulated losses	10	(26,974,656)	(25,671,786)
TOTAL EQUITY		12,231,473	11,557,265

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5. Consolidated statement of cash flows

		Year ended	Year ended
		31 March 2017	31 March 2016
	Notes	$	$
Cash flows from operating activities
Receipt from customers		40,283	193,668
Payment to suppliers and employees		(1,016,797)	(927,109)
Interest received		47,845	30,214
Net cash used in operating activities		(928,669)	(703,227)
Cash flows from investing activities
Acquisition of property, plant and equipment		(2,023)	-
Net cash used in investing activities		(2,023)	-
Cash flows from financing activities
Proceeds from the issue of shares		1,700,000	500,000
Share issue costs		(121,211)	(31,580)
Net cash provided by financing activities		1,578,789	468,420
Net decrease in cash held		648,097	(234,807)
Cash at the beginning of the year		1,883,929	2,120,345
Effect of exchange rates on cash balances		5,620	(1,609)
Cash at the end of the year		2,537,646	1,883,929

Consolidated statement of cash flows includes continuing and discontinued operations.

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6. Consolidated statement of changes in equity

Contributed equity Share based payment reserve	Foreign currency translation reserve	AFS reserve	Merger reserve Accumulated losses Total equity
$ $	$	$	$ $ $
Balance at 1 April 2015 32,185,790 -	(4,790)	340,715	24,828 (24,677,819) 7,868,724
Net loss for the year - - Other comprehensive income for the year - -	- 4,790	- 4,105,147	- (993,967) (993,967) (24,828) - 4,085,109
Total comprehensive income for the year - -	4,790	4,105,147	(24,828) (993,967) 3,091,142
Issue of shares 500,000 -	-	-	- - 500,000
Share issue costs (31,580) -	-	-	- - (31,580)
Share based payments - 128,979	-	-	- - 128,979
Balance at 31 March 2016 32,654,210 128,979	-	4,445,862	- (25,671,786) 11,557,265
Net loss for the year - - Other comprehensive income for the year - -	- 5,620	- -	- (1,302,870) (1,302,870) - - 5,620
Total comprehensive income for the year - -	5,620	-	- (1,302,870) (1,297,250)
Issue of shares for cash 1,700,000 -	-	-	- - 1,700,000
Share issue costs (174,803) 53,593	-	-	- - (121,210)
Share based payments - 392,668	-	-	- - 392,668
Balance at 31 March 2017 34,179,407 575,240	5,620	4,445,862	- (26,974,656) 12,231,473

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7. Significant accounting policies

a) Basis of consolidation

The consolidated financial statements comprise the financial statements of Transaction Solutions International Limited and its controlled entities at each date of the statement of financial position; and during the financial year ending at each reporting date. Control is achieved where the Group has the power to govern the financial and operating policies of an entity so as to derive benefits from those activities.

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

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

Subsidiaries are consolidated from the date on which control is transferred to the group and cease to be consolidated from the date on which control is transferred out of the Group.

Where there is loss of control of a subsidiary, the consolidated financial statements include the results for the part of the reporting period during which the accounting parent has control.

b) Revenue

Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, rebates and other similar allowances.

Interest

Revenue is recognised as the interest accrues (using the effective interest method, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial instrument) to the net carrying amount of the financial asset.

c) Employee benefits

Employee benefits such as salary and wages are measured at the rate at which the Group expects to settle the liability; and recognised during the period over which the employee services are being rendered.

Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits.

d) Leases

Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses over the period of the lease on a straight line basis.

Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred. In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight lines basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

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e) Income tax

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the statement of comprehensive income because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax

Deferred income tax is provided on all temporary differences at the reporting 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.

Deferred income tax assets are recognised for all deductible temporary differences, carryforward 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.

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.

Income taxes relating to items recognised directly in equity are recognised in equity and not in the income statement.

f) Other taxes

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

• where the taxes incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case those taxes are recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and

• receivables and payables are stated with the amount of taxes included.

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

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

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

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g) Earnings per share

Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.

The weighted average number of shares outstanding during the reporting period represents the equity structure of the legal parent, i.e. Transaction Solutions International Limited (“TSI Limited”).

h) Financial instruments

Financial instruments are recognised when the Group becomes party to the contractual provisions of the instrument. The de-recognition of a financial instrument takes place when the Group no longer controls the contractual rights that comprise the financial instrument, which is normally the case when the instrument is sold, or all the cash flows attributable to the instrument are passed through to an independent third party.

The financial instruments of the group comprise of (i) cash and cash equivalents; (ii) trade and other receivables; (iii) loans and receivables; and (iv) trade and other payables.

i) Share-based payments

Equity-settled share-based payments with employees and others providing similar services are measured at the fair value of the equity instrument at the grant date. Fair value is measured by use of valuation techniques. The expected life used in the model has been adjusted, based on management’s best estimate, for the effects of non-transferability, exercise restrictions, and behavioural considerations.

The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the group’s estimate of shares that will eventually vest.

j) Issued capital

Issued and paid up capital are recognised at the consideration received by the Group.

Expenses (including the tax effect) incurred directly in relation to the issue of the equity instruments are deducted from equity.

k) Assets classified as held for sale

Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the non-current asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification.

When the Group is committed to a sale plan involving loss of control of a subsidiary, all of the assets and liabilities of that subsidiary are classified as held for sale when the criteria described above are met, regardless of whether the Group will retain a controlling interest in its former subsidiary after the sale.

Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell.

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8. Dividend payments

No dividends or distributions have been paid or provided for during the year.

9. Dividend reinvestment plans

There are no dividend or distribution reinvestment plans in operation.

10. Accumulated losses

	31 March 2017	31 March 2016
	$	$
Accumulated losses
Balance at beginning of year	25,671,786	24,677,819
Loss for the year	1,302,870	993,967
Balance at end of the year	26,974,656	25,671,786

11. Net tangible assets per security

	31 Mar 2017	31 Mar 2016
	Cents	Cents
Net tangible assets per security	0.63	0.87

12. Available for sale financial assets

	31 Mar 2017 31 Mar 2016
	$ $
24.89% shareholding in TSI India opening balance Movement in fair value of shareholding in TSI India	9,750,000 5,644,853 - 4,105,147
	9,750,000 9,750,000

13. Joint venture

Not applicable.

14. Foreign Entities – Controlled entities, TSI Investments (Mauritius) Pty Limited

The consolidated group includes TSI Investments (Mauritius) Pty Limited, a company incorporated in Mauritius. The financial reports of the foreign entity in the Group have been prepared under International Financial Reporting Standards (IFRS).

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15. Commentary on Results

The Group’s principal activity during the year was to hold a minority investment in TSI India and seek other business opportunities with the objective of enhancing shareholder value.

The Group recorded an after-tax loss for the year of $1,302,870 (2016: $993,967). The loss is attributable to costs associated with business development activities and other costs associated with the operation of a publicly listed company in Australia.

At the end of the year the overseas assets of the Group are converted to Australian dollars at the prevailing rates of exchange. For accounting purposes a foreign currency translation reserve credit adjustment of $5,620 (2016: credit adjustment of $4,790) was recognised against those assets as a result of movement in those exchange rates during the year.

At the end of the year the carrying value of the Groups investment in TSI India is reviewed and translated to Australian dollars at the spot rate of exchange and any movement over the year is taken to the AFS asset reserve. The movement for the year was nil (2016: credit movement of $4,105,147)

Other than holding its investment in TSI India the Company is continuing to look for and review other investment opportunities which may enhance shareholder value.

16. Events subsequent to the Balance date

Subsequent to the balance date the Company announced it had entered into an exclusive agreement with a subsidiary of Novatti Group Limited to target the Indian digital payments market by establishing and marketing a range of mobile and online payment services.

The Company also announced the decision not to exercise or seek a further extension to the CX Partners option agreement, which expired on 30 April 2017, for TSN to purchase the remaining 75% equity of TSI India. The Company will continue to monitor the investment opportunity.

Other than the above no matters or circumstances have arisen since the end of the year which have significantly affected or may significantly affect the operations or the state of affairs of the Group in the future financial years.

17. Progress of Audit / Review

This Appendix 4E is based on a Financial Report that is in the process of being audited.

18. Audit Dispute or Qualification

None.

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