L1 GROUP LIMITED — Annual Report 2007

May 20, 2007

Platinum Asset Pty, Limited
^A.B.N. 29 082 954 795

Financial Report for the Year Ended 30 June 2005

Contents

$\frac{d\sigma}{d\tau} = \frac{d\sigma}{d\tau} \, .$

Directors' report
Auditors' independence declaration	z
Statement of financial performance	з
Statement of financial position	4
Statement of cash flows	5
Notes to the financial statements	6
Directors' declaration	Υ
independent audit report to the members	f4
	15

l,

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$\label{eq:1} \begin{split} \mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{D}}(\mathcal{D})=\mathcal{L}{\mathcal{$

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Platinum Asset Pty. Limited A.B.N. 29 662 954 798

Directors' Report

The Directors present their report on the consolidated entity consisting of Presinum Asset Pry Limited and the entities
It contratied at the end of, or during the year anded 30 June 2005.

Orrectors

$\sim$ $\sim$

ä,

www.cars
The following persons were directors of Platnum Asset Pty Landed during the whole of the Rhannel year and up to the end of this report.

K Nelson

A Cuffickd
M Helstsad

Principal Activity

r through in contrary
The pranoipsi activity of the consolicated entity for the period 1 July 2004 to 28 February 2006 was to act an an investment Company. , me principal econoy or the consumerance enoup to the persons is over as as many and a sea was no environment
From 1 March 2005 the concellation andly took over the responsibility of providing investment management servic

Trading Results

Transmy Resource
The consolidated profil of Platinum Asset Phy Limited for the year was \$121,480,241 (2004: \$81.334,907) after income 13x expense of \$51,619,038 (2004: \$34,664,352).

Dividends

Dividences
Pastinum Asset Ply Limbed paid a fully tranked intenth dividend of \$49.843442 per share on 27 August 2004. No final dividend has been proposed.

Review of Operations

recomm or operations
The consolidated operating profit before tax was 5173,112,277 (2004: \$115,989,259) and \$121,493,241 (2004: \$81,334,907) after tax.
Consolidated income tax expense for the year was \$51,919,036 (2004: \$3

Directors' indemnity insurance

Comp in a mass and mass and the state of a contract insuring the directors of the consolidated emity was paid by
Platinum Asset Management Emated

Changes in the State of Affairs

viewspear in the state of Pisans
There were no significant changes in the State of Affairs of the consolidated entity that goburned during the financial year and
There is a wide construction otherwise disclosed in this report or financial statements

Events subsequent to the end of the financial year

Events secondered to the entito the memory year.
No significant events have documed since the balance date which would impact the financial position of the comedidated entity as at 30 June 2005 and for the results for the year ended on that date.

Likely Developments

Cheery Developments
There will be no change in the principal sclivity of the consolidated entity during the next financial year.

Environmental Regulation

enverweren mearweren.
The consolidated entity is not subject to any particular or significant environmental regulations under Commonwealth, State or Territory Law.

Cxecutives

The consolidated entity has no executives other than the Directors disclosed in this report.

This report is made in accordance with a resolution of the directors.

s fAluh x skolca

Director

Sydney 19 August 2005

M Haistead Oirector

Platinum Asset Pty. Limited A.B.N. 29 862 954 798 Auditors' Independence Declaration

As lead auditor for the audit of Platinum Assel Pty Limited for the year ended 30 June 2005, I declare that to the best
of my knowledge and bailet, there have been:

a) the contraventions of the auditor independence requirements of the Corporations Act 2001 in relation
to the eadlit; and
b) no contraventions of any applicable code of professional conduct in relation to the eadlit.

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$\sim 10^{11}$ km $^{-2}$

PK Merrett
Partner PricewaterhouseCoopers

Sydney
19 August 2005

Liability is limited by the Accountants Sofrems under the Professional Standard Act 1994 (NSW).

$\mathcal{A}$

÷.

Platinum Asset Pty. Limited

Statement of Financial Performance
For the Vear ended 30 June 2005

$\mathbf{z}^{(i)}$ , $\mathbf{z}^{(i)}$ , $\mathbf{z}^{(i)}$ ,

		Consolidated		Parent entity
		2005	2004	2035	2004
	Noting	\$	\$	Ţ.	\$
Revenue from ordinary activities
Operating revenue
Inferest income		194.472.221	116,921,259	126,913,370	116,921,259
Owsdend issessign		4.334,902	122,734	65.535	122,734
investment income		10.484		5,147
		247.045	c.	(102,718)
Total revenue from ordinary activities
		189,064,652	116,043,923	126,854,934	116,043,993
Expenses
Operating experises Depreciation
Professional:		23,820,897
- Audit		603,975	v
- Tax		263,776
- Approximancy		452,356	3,986	16.578	3,980
Compliance costs		÷	3,170 35,000	13,730	3,170
interest Expense		520,222	200		35,000
Sundry expenses		268;279		212 24,409	200
		33,070	2,364	10,295
Total Expenses					2,394
		25,952,375	44.734	65,204
Profit from ordinary activities before related income tax expense					44,734
		173, 112, 277	115,999,259	126,819,730	115,999,259
thouries tax expense.
	2	(51,619,636)	(34, 664, 352)	(38, 621, 234)	(34.664.352)
Profit from ordinary activities after related income fax expense
		121,493,241	81,334,907	88,798,496	81,334,987
The above Statement of Financial Performance should be read in conjunction with the accompanying spies

Page $4$

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i
Politika

Platinum Asset Pty. Limited
ABN 2002964796

Statement of Financial Position

$\mathbf{v} = \left{ \begin{array}{ll} 0 & \mathbf{v} \in \mathbb{R}^d \times \mathbb{R}^d \end{array} \right.$

$\bar{\alpha}$

		Consolidated		Parent eraily
		2005	2004	2005	2004
Current assets Casir on deposit	Motes.	\$	s	\$	\$
Trade slebtors	13	133,792,370
Investment income receivable		14,773,877	5,332,502	7	281,496
Riskeled party account		$\sim$	ä.
Interest Radaivable		2,550	115,921,259 $\alpha$		115,921,259
Prepayments		33,070	2.401	101.943,642
income tax raceivable.		512,270	$\epsilon$		1.480
Deferred tax assets		262,403	243
Total current assets		477.348	2,746	22.230	à.
		149,873,898	121,259,150	101,985,939	1,890 116,206,125
Non current assets
investments
investment in securities
investment in associated entities		1,163,625	3,195,911		3,195,911
thyesthent in consiglied entities.			2.085,223		2,085,223
Total investments			$\Delta$	14,105,231	51,006
		1,163,625
Fixed Assets			5,281,134	14,105,231	5,332,139
	3	1,812,582
Total non current assets			۸
		2,976,207	5,281,134	14,105,231
Total assets					5,332,139
		152,350,095	126,540,284	116,071,170
Current Habilities					121,538,264
Payables
Related party account	4	3,144,375	24,498	8,446	23,800
Payable for Investment		×	17,692,806	÷.	17,691,781
income tax payable		÷.	3,597,800		3,597,800
Deferred tax liabilities Provisions		14.159,084	B,234,419	14,189.054	8,234,419
	5	9,921 885,741	278
Total current fiabilities			$\overline{a}$
		18,199,091	29,549,800
Non current liabilities				14, 167, 502	29.547,780
Provisions
Subordinated debi	5	52,591
		$\overline{a}$	5,000,000
Total non current liabilities
Total liabilities		52,591	5,000,000	$\ddot{\phantom{1}}$	٠
		18,251,682
Net assets			34,549,800	14,167,502	29,547,780
		134,598,413	91, 980, 484
Shareholders' equity				101,903,668	91,890,484
Contributed equity
Retained profits	7	13,105,172	10,656,577	13,108,172
	ŝ	121,493,241	81,334,907	56,798,496	10,655,577 81,334,907
Total shareholders' equity
		134, 598, 413	91,990,484	101,903,668	91,990,484
The above Statement of Financial Organism process to

$\bar{\tau} h$ inancial Position should be read in conjunction with the accompanying nates $\hat{\mathcal{L}}$

Platinum Asset Pty. Limited
AB.N. 29.082.954.796

Statement of Cash Flows

$\hat{\mathbf{r}}$

	. . .
For the frear ended 30 June 2005

For the Year anded 30 June 2005.		Consolidated		Parent entity
		2005	2004	2005	2004
	Notes.	\$	s	\$	s
Cash Flow from Operating Activities
income received from myestments
interest received		116,921,256	\$3,729,515	242,834,829	53,729,515
Dividends received		4,304,233	121,256	70.915	121,256
income from ontinary activities		16.434	$\sim$	5.347
Expenses paid for ordinary activities		179,698.344 (21, 532, 746)	$\sim$
Inferest expense.		(258,977)	(25,435)	(56, 145)	(26, 435)
frecome taxes paid		(46,441,618)	(33, 165, 443)	(24,409)
				(32,116,996)	(33,185,440)
Net cash intiow from operating activities	13(b)	231,701,084	20,658,896	210,712,238
Cash flow from investing activities					20.666.898
Cost of purchases of investments
Proceeds from sale of investments.		(11,454,948)	×	(19,686,531)	(51,005)
Purchase of plant and equipment		12,228,030	5,000,000	7,215,519
		(2,428,485)
Cash flow from financing activities
		(1,655,403]	5,000,000	(12,473,012)	(51,005)
Cash Flow from Financing Activities
Dividende paid		(81,334,907)
Proceeds from issue of shares		2.449,595	(37, 352, 623) 7,188,938	(81.334,907)	(37,362,633)
Payments (to)/from related party		(17,695,356)	9,836,825	2,449,585	7,186,908
Repayment of Subordinated debt		(6,000,000)	$\overline{a}$	(119,635,403)	9,838,820
Cash flow from tinancing activities					$\sim$
		(101.580.899)	(20, 326, 899)	(198,520,715)	(20,326,899)
Net increase/(dacrease) in cash
		126,465,013	6,331,997	(281,480)	280,992
Net cash balances at commencement of the financial year
Effects of exchange rate changes on cash		5.332,501	504	281,498	504
		(5, 344)			×.
Cash balances at 30 June 2005
	13(a)	133,792,370	5,332,501	71	281,496
The above Stamment of Cash flows Blootd he read in contumbon with the tecompanying notes

Platinum Assef Pty, Limited A.B.N. 29 062 954 796

Notes to the Financial Statements As at 30 June 2005

1. Summary of Significant Accounting Policies

The consolidated emity is not a reporting entity because, in the directors' opinion it is unifiedy that users exist who are unable to continant the preparation of reports belongs so as to ealisfy, specifically, as of their information needs. It is the opinion of the directors that the accomming poticies adopted are appropriate to meet the needs of the members.

This is a special purcess financial report that has been prepared for the sole purpose of complying with the Corporations Act 2001(Cth) requirements to prepare and distribute a linencial report to the members and must not be used for arsv other purpose.

The Financial Statements have been prepared on the basis of historical cost. Unless otherwise stated, the accounting posicies adopted are consistent with those of the previous year.

(a) Basis of Accounting

The consolidated antity has applied Accounting Standard AASB 1025 * Application of the Reporting Entity Concept and Other Amendments", which amends the application clauses of as existing istendance so that they cow apply only to companies that quality as reporting entities. However, the financial report has been prepared in accordance with AASB 1018 was speed for concerne of these channels are interesting to the present Presentation and Disclosures". AASB 1040
"Statement of Financial Performance", AASB 1034 "Financial Report Presentation and Disclosures". AASB 1040 "Statement of Financial Position" and other appacable Accounting Standards and Urgent Issues Group Consensus Views with the exception of the disclosure requirements in the following: AASB 1001 "Accounting Policies"

AASB 1917 "Related Party Disclosures" ARSB 1028 Statement of Cash Flows"

AASB 1033 "Presentation and Disclosure of Financial Instruments"

AASB 1046 "Director and Executive Disclosures by Disclosing Entities"

AASB 1047 "Disclosing the Impacts of Adopting Australian Equivalents to International Financial Reporting Standords"

(b) Income Recognition

interest income is recognised on an accounts beek.

Dividend income is recognised on the ax-dividend date applicable to each investment

Management and Performance fees are recognased as they are pamed and all expenses are brought to account on an ancruse hass Trust Distribution income is recognised on an accruate basis,

(a) income Tax

income lax has been brought to account using the liability method of tax effect accounting.

(d) Cash

.
For the purposes of the Statement of Cash Flows, oss't includes deposits at call and cash at bank which are used in the daily management of the consolidated entity's cash requirement.

(e) Principles of consolidation

the consolidated (mande) statements indorporate the assets and liabilities of all enblies controlled by Platinum Asset Ply Lindled ("company" or "parent entity") as at 30 June 2005 and their results of all controlled entities for the year then ended. Platinum Asset Pty Limited and its controlled entities together are referred to in ite Brancial report as the consolidated entity. The effects of all transactions between entities in the consolidated emäy are eliminatad in fall

Where control of an entity is obtained during the financial year, its results are included in the consolidated statement of Brancial performance from the date on which control commences. Where control of an ensity crasse during a financial year its results are included for that part of the year during which control existed.

(f) buyestments

(i) Classification

the stream is have not been classified in the Statement of Pinencial Position as current or non-current assets. In the asiston of the Chiectors, having regard to the nature of the business convincted by the consoligated emby. the penod of investment is not known at the time of purchase. (ii) Valuation

.
Bastests in listed and unisted securities, other than controlled emities and associates in the consolidated financial statements, are brought to account at nost and dividend income is recognised in the statement of financial performance when receivable. Convolied entities and associates are accounted for in the consolidated financial statements as set out in the).

traveniments are camed at cost, with the exception of monotary items, which are stated at not beingable Where in the opinion of the consolidated entity, there has been a permanent domoution in the value of an investment, the carrying annuari of the investment is written down in its recoverable value.

(g) Receivables

All receivables are recognised as and when they are due.

Proceeds on sale of investments are usually received between 2 and 5 days after trade date. Interest is usually received within 3 days of becoming receivable and dividends are usually received

within approximately 30 days of the ex-divatent date

Trade debions are usually received between 7 to 30 days after becoming receivable.

Debts which are known to be uncollectible are written off. A provision for traubitor debts is raised when some stockt as to collection exists.

Page 7

Platinum Assef Pty. Limited

A.B.N. 29 062 954 796

Notes to the Financial Statements (continued) As at 30 June 2005

(h) Depreciation

$\sim$

Fised assets are depredated over their estimated useful Sven using the straight line medind.

THE RADBLING USERS RYES BIR 25 1920AN.
Computer Squipment.	25%
Software	425.
Captained Setware	40%
Communications Enerprised.	$5 - 25%$

Officio Pe Out Office Putnising & equinolant

(f) Payables

All payables and trade meditors are recognised as and when they are incurred

(j) Borrowing costs

Borrowing abels are recognessed as expenses in the parked in which they are incorrect.

$7.5\cdot20\%$

$7.5 - 20%$

(k) Employee antitlements

the structure of conservations and selectes and assual teave are accrued at sominal arounds calculated on the stationed on engineering starts retire wise and as an user and server as security accounter answer as a station
basis of current salary raiss. Liabilities for long service leave which are not to be part or selfled within 1 are charged as an expense as the contributions are paid or become payable.

(I) Goodwill

Concrete the comprehend on a straight line basis over a period of 20 years from the date of acquaition. The unanecritaed balance is reviewed antically to determine the extent that future benefits are probable.

(m) Dividends

Provision is made for the amount of any dividend declared, determined or publicly recommended by the directors on or before the end of the financial year but not distributed at batance data.

(h) Foreign currency translation

Transactions denominated in foreign currencies are translated at the exchange rate at the date of the transaction. Foreign mometary assets and liabilities at tratence date are transferred at exchange rates current at the balance date. Exchange gains and losses are broadid to account in determining the results for the financial year. The consolidated entity does and undertake speculative dealings in foreign currency. Exchange gales and losses on currency hedges are brought to account in determining the results for the financial year.

		Consolidated		Parent entity
	2005	2004 s	2005 \$	2004
2. Income Tax The aggregate arrount of lax attributable to the financial year differs from the amount prime facte payable on the operating profit.
Profit from ordinary activities before income tax expense	173,112,277	115,999,259	126,819,730	115,999,259
Prima facie income tax on eperating profit at 30%	51,923,083	34.709.778	30.045.919	34.799,778
Tax effect of permanent differences that decrease tax payable - Alkovable credits Quarantined foreign losses now claimable	(292.327) (183, 864)	(1,705)	(2,355) (183, 664)	(1,735)
Tax effect of permonent differences that increase tax payable. - Difference between taxable income and distributable income. - not deductible expenses	150,836 1,708	(133,722)	159,636 1,708	(133, 722)
Under/(over) provision of prior paried
Income tax aftributable to operating profit, comprising the current tax provision.	51,819,030	34,664,382	36,021,234	34,664,352
The income tax expense comprises:
Coment income tax provision Deferred income lax Fultare income fox benefit Under/over) provision of andr period	52,083,993 9,645 (474, 602)	34,664,591 $\mathbf{a}$ (240)	38,041,634 (20, 400)	34,664,591 (246)
	51,619,036	34,664,352	38.021.234	CA2 520 AF

Platinum Asset Pty. Limited
A.B.N. 20062064786

$\alpha_{\rm{max}}=100$

Notes to the Financial Statements (continued)

As at 30 June 2005	Consolidated		Parent entity
3. Fixed Assets	2005 Ż.	2004 £.	2355	2004
			s.	Ť.
Computer equipment (at cost). Less, Accumulated deprecipiion	415,904 (137,412)
	278,492
Purchased software (at cost) Less: Accumulated deprediation	224,243
	(102.376) 122,067		÷
Capitalised software (at cost)	586,518
Less. Accumulated depredation	(229,177)
	457,341
Communication equipment (at 50st) Less: Accumulated depreciation	126,176 (41.818)
	84,562
Office premises fit car (at cost). Less: Accumulated depreciation	555,592 (46.396)	٠
	509,193
Office furniture and equipment (at cost)	403,295
Less: Accumidated depreciation	(42,368)		$\ddot{\phantom{a}}$
	360,927 1,812,562	$\overline{\phantom{a}}$
4. Payables			$\blacksquare$	$\sim$
Trade creditors (grispoured) Goods and services fax	2,102,850 1,041,525	23,800	8,448	23,800
interest payable		690	$\ddot{\phantom{a}}$	$\boldsymbol{\lambda}$
	3,144,375	24,498	8,449	23,800
5. Provisions
Current
Long service kaive Annual leave	268,449 699,202
	885,741	$\overline{\phantom{a}}$	$\frac{1}{2}$
Non current Cong service leave	52,591
	52,591	÷	$\tilde{\phantom{a}}$	٠
6. Franking Account
Opening Balance 1 July - converted at 30%	37,560,876	18,963,125	37,559,448	18,903.126
Oredends paid	(34,857,847)	(15.005, 271)	${34,857,857}$	(19,808,271)
Tax paid / payable	90,082,486	34.664,592	90,082.486	34,664,662
Franking credits arising from consciousne		1.430	1,430
Estimated Franking Credits Available.	92,785,545	37,560,876	92,786,545	37,559,446
Atticupi of retained profits that could be distributed as dividends and be tranked out of exating credits or out of franking credits adding from the payment of income tax in the parket subsequent to 30 June 2005,
after deducting tranking credits applicable to any proposed dividends.	121,493,241	31,334,907	88,798,496	81,334,907

$\frac{1}{2}$

$\frac{1}{4}$

$\label{eq:3.1} \frac{1}{2} \int_{-\infty}^{\infty} \frac{1}{2} \left( \int_{-\infty}^{\infty} \frac{1}{2} \left( \int_{-\infty}^{\infty} \frac{1}{2} \left( \int_{-\infty}^{\infty} \frac{1}{2} \left( \int_{-\infty}^{\infty} \frac{1}{2} \left( \int_{-\infty}^{\infty} \frac{1}{2} \left( \int_{-\infty}^{\infty} \frac{1}{2} \left( \int_{-\infty}^{\infty} \frac{1}{2} \left( \int_{-\infty}^{\infty} \frac{1}{2} \left( \int_{-\infty$

ł

Fiatinum Asset Pty. Limited
ABN 2002354796

$\Delta \mathbf{r}$ and $\mathbf{r}$ and $\mathbf{r}$

Notes to the Financial Statements (continued)
As at 30 Jane 2005

7. Contributed Squity		Parent entity 2005	2005	Parent entity
(a) Share Capital		Units	ŝ	2004 Units	2004 \$
Crobinary shares, fully paid Ordinary shares, paid to \$74.90 Chotmany shares, paid to \$11.56 Ordinary sfores, 2010 amount paid		1,746,139 $\sim$ $\sim$ 3,226	13,105,172 $\mathbf{v}$	1,723,210 17,095 3,454	3,335,179 1,280,398 40.000
		1,749,365	13,105,172	1,743,759	10,655,577
(b) Movements in share capital
Date	Detairs		Nomber of sharas.
30-3-88-03	Opening balance			issue price	s
09-Sep-03			1.686.689		3,466,589
09-Sep-03	Share issue Share issue - parity paid \$74.98		22,813	137.00	3,125,381
26-Nov-02	Share issue		17.095	74.90	1,280,398
26-Nov-03	Share issue - partly paid \$11.58		13,728	199.82	2,743,129
			3,454	11.58	40,000
27-Aug-04	Share issue 17,095 - balance paid \$62.10		1,743,759		10,655,677
27-Aug-04	Share issue 3,454 - balance paid \$186.24			62.10	1,061,814
25-Nov-04	Share aspe			186.24	650,181
25-Nov-64	Sitere issue - unpaid		2,380 3,226	310.00	737,800
Cromary shares				3:0.00	o
	Ordinary shares entite the holder to participate in dividends and the proceeds on winding up of Pratinum Asset Pty Linkted in proportion to the number of and amounts paid on the shares held.		1,749,365		13,105,172

	Consolidated 2005		Parent entity
8. Refained Profits	э	2034 ъ	2006 s	2004
Retained carnings at the beginning of the financial vaar	81,334,907	37,352,633	\$1,334,607	37,352,633
Net profit	121,463,241	61,334,667	68,798,498	81,334,907
Dividends paid or payable	(81,334,907)	(37.352.623)	(81.334,907)	(27,362,633)
Retained earnings at the end of the financial year	121,493,241	81,334,907	85,788,496	81,334,007

$1 - 1 - 1 - 1 - 1 - 1 - 1 - 1 - 1 - 1 - 1 - 1 - 1 - 1$

in Artist

Platinum Asset Pty. Limited A.B.N. 29 062 954 796

Notes to the Financial Statements (continued)

As at 30 June 2005

$\sim$ $\sim$

$\ddot{\phantom{a}}$

Q. Contingent LightHing

9. Contingent Liabilities		Consolidated		Parent entity
No coninuent labilies exist at balance date with the exception of labilities nourred by the consolidated entity in its capacity as Trustee of the Trust. The consolidated entity has the right of indetently out of the Trust's assets. As a result of the absorption of the business during the year the consolidated antity ceased to act in the capacity of a trustee.	2005	2004	2005 Ŝ	2004
Trustee's fabilities incurred on behalf of the Trust.		148,235,147
Assets of the Trust available to meet liablities.		161,032,531
10. Commitments
Toust lease experiments contracted by the consolidated entity at balance date but not provided for in the accounts:
Operating leases
Payable not later than one year.	776,973
Payable later than one, not later than two years	388,486	$\cdot$
Peryable fater from two, not taken then five years.
Payable later man five years
	1,165,459

11. Directors Remuneration

No reinumeration was paid to Directors during the year or prior period.

12. Subsequent Events

Alb significant events have cocurred since the balance date which would impact the financial position of the consolidated entity as at 30 June 2005 and for the results for the year ended on that data.

13. Notes to the Statement of Cash Flows

(a) Reconciliation of cash

Por the purposes of the Statement of Cash Flows, cash includes deposits all call and cash at bank which are used in the daily management of the consolidated entity's cash requirement. Cash at the end of the tinancial year, as shows in the Statement of Cash Flows, is reconciled to the related items in the Statement of Financial Postkim as follows:

Cash at bank 6,230 $\overline{7}$ ž Cash on deposit 133,786,140 6.332.444 281,489 133.702,370 5,332,501 | 7Ţ $281,496$ (b) Reconciliation of Net Cash from Investment Activities to Operating Profit after Tax Operating profit(loss) after tax 121,493,241 81,334,607 88,798,496 81,334,907 Depreciation expense 603.975 $\ddot{\phantom{a}}$ $\ddot{\phantom{a}}$ Loss on disposal of assets 11,928 L. Non-cash engloyee banelil expense 66.550 $\mathbf{r}$ (Gain)/foss on investment income $(252, 189)$ $\overline{a}$ 102,118 $\ddot{\phantom{0}}$ Movement in monetary items $(1.185)$ $\overline{\phantom{a}}$ L. (increase)/decrease in cash due to exchange rate movements $5,144$ Decrease/(increase) in distribution receivable 115,921,269 $(62, 191.743)$ 115,921,259 $(62.191, 743)$ Decrease/thorease) in trade debiors $(14, 773, 877)$ Decrease/(Increase) in interest receivable $(30, 669)$ $(1,480)$ $1,480$ $(3.480)$ Decrease/(Increase) in prepayments $(512, 270)$
$3.119, 878$ (Decrease)/increase in accross separates 16,306 $(55,350)$ 18,300 (Decrease)/increase in provisions $871,782$ $\mathbf{a}$ .
Decrease/(Increase) in income tax receivable $(282, 160)$ (Decrease)/traresse in income tax payable 5.524.835 1,499,162 5,924,635 1,489,152 (Decrease)/increase in deferred tax assets ${474,303}$ $(240)$ $(20, 400)$ $(240)$ Decreaser/increase) in deterned tax liabilities $0.645$ 231,701,064 20,656,896 216,712,238 29,858,890

Platinum Asset Ptv. Limited A.B.N. 29 062 984 796

Notes to the Financial Statements (continued)

14. Investments in controlled entities

$\mathcal{L}_{\mathcal{A}}$

As at 30 June 2005

Nather of entity	Country at iRocargoratigo	Class af Shares	Equity Holding 2005	2004
Ptainum Asawi Management Landed	Australia	Crotinary	100%	100%

Acquisition of controlled entity

On 26 Arns 2004 the parent entity acquired 31,005 of the issued capital of Piptimum Assaf Management Limited for \$51,005. The operating mealty

of this newly controlled entity have been included in the consolidated statement of linencial performance aince the date of ecquation

		Consolidated		Parent entity
	2005 Ī.	2004	2065	2004
Fair value of identifiable hat assets of controlled entity adquired.			s	э
Cash
Receivables		п.	۰	6,051,006
Payables			$\sim$	2,028
Subordinate debt				(2.223)
		$\mathbf{u}$		(5,000,000)
Cash consideration
				51,005
Outflow of cash to acquire controlled emity, net of cash acquired.
Cash consideration
Less: Cash accurings				(51,006)
				5,051,005
instow of cash
	We are considered to the control of the second company in the whole program in the delight construction			5,000,000

15. The Company

Platisian Asset Ply Limited (the Company) is a company limited by shares, incorporated and domicled in New South Wales. Its registered office and principal place of business is Level 4, 55 Harrington Street, Sydney, NSW 2000.

A description of the nature of the Correspy's operations and its principal addylies is included in the review of operations and activities in the Directors' report.

18. Subordinated debt

On the 12 May 2005 the seed of subordination between the Platinum Asset Management Limited, the Lender and the Australian Securities and investments Commission ("ASIC") entered into was cancelled at which time the borrowings were repaid. There are now sufficient funds in the consolidated entity to meet the conditions and requirements of the of the Australian Financiat Services Licence.

17. Segment Reporting

This consistenced antity operates solely within Australia and its income is derived to Australia

18. Director and Executive Disclosures Directors

The names of persons who were directors of the Company at any fare during the financial year are as follows: K Neison

A Cattord

M Halstead

Principles used to determine the nature and amount of remuneration No Director, or estity altrer controlled by a Director or of which a Director is a member or in which the Director has a substantial filteriolal interest, has received or become entitied to receive a benefit by reason of a contract made by the conspionaisd subty.

Relianent benefits by Directors No retirament benefits are provided to Directors

Other benefits and incentives

No other benefits and incomines are paid to Directors.

Details of remuneration

The Executive Directors (K Neitson, A Clifford & M Halstead) are remunerated by the consolidated entity. The experience of entertainty part in the service with a service of the members are up an example enterpressure of the state of \$11,002);
The consolidated entity part: K Nelson a salary of \$250,000 (2004:\$200,000) and supe M Halstead a salary of \$260,000 (2004:\$178,000), a borus of nil (2004:\$200,000) and superamulation of \$11,584 (2004:\$11,002)

19. Related Party Information

Directors

Disclosures relating to directors are set out in note 18.

Related parties

Interest experies paid to a director related entity of K Wellson amounted to \$233,670 (2004; \$258,315).

Platinum Asset Pty. Limited

Notes to the Financial Statements (continued) As at 30 June 2005

$\theta_{\rm{max}} = \frac{1}{\sqrt{2}} \left( \frac{1}{\sqrt{2}} \right)$

20. Risk Management

1. KiSK managemans
   Courseporty Risk entity is exposed to counterparty risks - the possibility of losing money owing to the default of a deposit taking
   The consolidated entity is exposed to counterparty risks - the possibi

Page 13

Platinum Asset Pty, Limited
ABN. 29.062.964.796

Directors' Declaration

$\bar{z}$

$\sim$

As stated in Note 1 to the financial statements, the consolidated emily is not a reporting antity because, in the directors' opinion.
It is unlikely that users exist who and unable to command the preparation of reports tak Act 2001.

.
The conspliciated entity has applied Accounting Standard AASB 1025: "Application of the Reporting Entity Concept and Other
Amendmanis" and other Accounting Standards and mandatory professional reporting requirements, to described in note 1.

The directors declare that the financial statements and notes set out on pages 4 to 13;

-68)	comply with Accounting Standards, as detailed above, and the Corporations Requisitions 2001; and
(D)	give a true and fair view of the company's and consediated entity's financial position as at 30 June 2005
	and their performariste, as represented by the rest of its operation and its cash frow, for the Roardoal
	vear ended on that date.

in the directors' opinion

the feart/as statement and rides are in accordance with the Corporations Act 2001; and (a) there are reasonable grounds to believe that the company will be able to pay its deals as $\langle \rangle \rangle$ and when they become due and payable

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

.
Maisan Director

and

M Haistead Director

Sydney 19 August 2005

Independent audit report to the members of Platinum Asset Pty Limited

Audit opinion

In our opinion, the financial report of Platinum Asset Pty Limited:

• gives a true and fair view, as required by the Corporations Act 2001 in Australia, of the financial position of Platinum Asset Pty Limited and the Platinum Asset Pty Limited Group (defined below) as at 30 June 2005 and of their performance for the year ended on that date in accordance with the accounting policies described in Note 1 to the financial statements, and
• is presented in accordance with Accounting Standards and other mandatory financial reporting requirements in Australia to the extent described in Note 1 to the financial statements, the Corporations Act 2001 and the Corporations Regulations 2001.

This opinion must be read in conjunction with the rest of our audit report.

Scope

The financial report and directors' responsibility

The financial report, being a special purpose financial report, comprises the statement of financial position, statement of financial performance, statement of cash flows, accompanying notes to the financial statements, and the directors' declaration for Platinum Asset Pty Limited (the company) and for the Platinum Asset Pty Limited Group (the consolidated entity), for the year ended 30 June 2005. The consolidated entity comprises both the company and the entities it controlled during that year. It has been prepared for distribution to members for the purpose of fulfilling the directors' financial reporting requirements under the Corporations Act 2001.

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

The directors have determined that the accounting policies used and described in Note 1 to the financial statements, including the basis of accounting, which forms part of the financial report, are appropriate to meet the requirements of the Corporations Act 2001and the needs of the members.

Audit approach

We conducted an independent audit of the financial report in order to express an opinion on it to the members of the company. No opinion is expressed as to whether the accounting policies used, and described in Note 1, are appropriate to the needs of the members. We disclaim any assumption of responsibility for any reliance on this audit report or on the financial report to which it relates to any person other than the members, or for any purpose other than that for which they were

PricewaterhouseCoopers ABN 52 780 433 757

Darting Park Tower 2 201 Sussex Street GPO BOX 2650 SYDNEY NSW 1171 DX 77 Sydney Australia www.pwc.com/au Telephone +61 2 8266 0000 Facsimile +61 2 8266 9999

prepared.

Our audit was conducted in accordance with Australian Auditing Standards. The nature of an audit is influenced by factors such as the use of professional judgement, selective testing, the inherent limitations of internal control, and the availability of persuasive rather than conclusive evidence. Therefore, an audit cannot guarantee that all material misstatements have been detected. For further explanation of an audit, visit our website http://www.pwc.com/au/financialstatementaudit.

We performed procedures to assess whether in all material respects the financial report presents fairly, in accordance with the Corporations Act 2001 and the accounting policies described in Note I to the financial statements, a view which is consistent with our understanding of the company's and the consolidated entity's financial position, and their performance as represented by the results of their operations and cash flows. These policies do not require the application of all Accounting Standards and other mandatory financial reporting requirements in Australia.

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

• examining, on a test basis, information to provide evidence supporting the amounts and ٠ disclosures in the financial report, and
• assessing the reasonableness of significant accounting estimates made by the directors.

Our procedures include reading the other information in the Annual Report to determine whether it contains any material inconsistencies with the financial report.

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

Our audit did not involve an analysis of the prudence of business decisions made by directors or management.

Independence

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

recorderbandospers PricewaterhouseCoone

Partner

Sydney 19 August 2005