VOLT GROUP LIMITED - Annual Report 2010

Enerji Limited ABN 62 009 423 189

Annual Financial Report 31 December 2010

Enerji Limited

Corporate Directory

DIRECTORS

Ian Campbell (Non-Executive Chairman) Appointed 19 November 2009 Greg Pennefather (Executive Director) Appointed 4 June 2009

Rolf Hasselström (Non-Executive Director) Appointed 7 September 2009

COMPANY SECRETARY

Geoffrey Reid

Appointed 25 February 2010

REGISTERED OFFICE

Level 22, Allendale Square 77 St George’s Terrace Perth WA 6000 Tel: (08) 9325 8888 Fax: (08) 9325 8088

PRINCIPAL PLACE OF BUSINESS

Suite A5, 435 Roberts Road Subiaco WA 6008 Tel: (08) 9287 4000 Fax: (08) 6380 2495 Email: [email protected]

SHARE REGISTER

Link Market Services Pty ltd Ground Floor 178 St George’s Terrace Perth WA 6000

SOLICITORS

Steinepreis Paganin Level 4, 16 Milligan Street Perth WA 6000

AUDITORS

BDO Audit (WA) Pty Ltd 38 Station Street Subiaco WA 6008

BANKERS

Bankwest Perth CSC 108 St Georges Terrace Perth WA 6000

INTERNET ADDRESS

www.enerji.com.au

Enerji Limited

Directors’ report ........................................................................................................................1 Statement of financial position................................................................................................11 Statement of comprehensive income .....................................................................................12 Statement of changes in equity ..............................................................................................13 Statement of cash flows..........................................................................................................14 Notes to the financial statements............................................................................................15 Directors’ declaration ..............................................................................................................42 Independent auditor's report to the members of Enerji Limited .............................................43 Auditor’s independence declaration........................................................................................45 Corporate Governance Statement..........................................................................................46 ASX additional information as at 30 March 2011....................................................................52

Enerji Limited

Directors’ report

For the year ended 31 December 2010

The directors present their report together with the financial report for Enerji Limited (“Enerji” or “the Company”), of the Group, being the Company and its subsidiaries for the year ended 31 December 2010 and the auditor’s report thereon.

1. Directors

The directors of the Company at any time during or since the end of the financial year are:

The Hon Ian Campbell

Non Executive Chairman, Appointed 19 November 2009

The Hon. Ian Campbell’s career spans both the private and public sector, combined with experience in the resource, environment, and energy industries. Mr Campbell has 17 years of Australian Government service, culminating in his appointment to the Federal Cabinet as Minister for Environment and Heritage. From 1996 through to 2007, he was a member of the Howard government Ministry. Serving as Parliamentary Secretary to the Treasurer (Peter Costello) for 4 years, he had responsibility for the Corporations Law Economic Reform Program. He attended the World Bank Board of Governors and IMF Annual meetings in 2002 and 2003. Mr Campbell served in a range of other portfolios in the Ministry and Cabinet as well as being a member of the Prime Minister’s leadership group, the Expenditure Review Committee (Razor Gang) of Cabinet and Manager of Government Business in the Senate.

In addition to his public and former ministerial profile as a key member of the Australian Federal Government, Mr Campbell has had a distinguished business career. Prior to entering Parliament, he worked as an Executive Director of a major commercial and industrial property agency. Now returned to the private sector, Mr Campbell currently holds non-executive director positions for Austal Ltd, ASG Group Ltd, Solco Ltd, and Proto Resources and Investments Ltd. Mr Campbell is also Chairman of the North West Iron Ore Alliance (a private infrastructure group) and Chairman of the Princess Margaret Hospital Foundation.

Mr Greg Pennefather

Executive Director, Appointed 4 June 2009

Mr Pennefather is the founder of CoGen ORC Power and has been developing the business model and researching the technology for 2 years. He is an engineer by training and for the past 2 years he has been the principal consultant at leading Perth engineering consultancy, Titan Consultants.

Prior to joining Titan Consultants, Mr Pennefather has been involved in several start up businesses and served on the boards of ASX listed companies. He was a co-founder of Request Broadband which introduced DSL broadband into Australia and was previously a director of Real Time Media Ltd, Flowcom Ltd and Halcyon Group Ltd.

Mr Rolf Hasselström

Non Executive Director, Appointed 7 September 2009

Mr Hasselström is the President and CEO of Opcon AB and holds a Master of Business Administration from the Stockholm School of Economics.

Mr Hasselström holds the following additional Board appointments: President of all companies in the Opcon Group, EKF Enskild Kapitalförvaltning AB; MNW Music Records Group; Lycknis AB; Calamus AB; Calamusgruppen AB; Svenska Rotor Holding AB; RMH Holding AB; Rolf Hasselström Konsult och Förvaltning AB; Landström Arkitekter AB; TPC Components AB; Rotor Estonia OÜ and GEP Action AB.

Enerji Limited

Directors’ report

For the year ended 31 December 2010

Ms Samantha Tough

Non Executive Director, Appointed 23 February 2010, Resigned 15 July 2010

Mr Guy Le Page Non Executive Director, Appointed 20 March 2009, Resigned 12 March 2010

Mr Ross Smith Non Executive Director, Appointed 20 March 2009, Resigned 11 March 2010

2. Company Secretary

Mr Geoffrey Reid

Appointed 25 February 2011

Mr Reid holds a Bachelor of Business degree and is a Certified Practicing Accountant. Mr Reid has held numerous role in finance in the mining, oil and gas sectors.

Mr Greg MacMillan

Appointed 2 September 2009 Resigned 25 February 2011

3. Principal activities

The principal activities during the year were focusing on establishment of green energy technology, in the form of the 3[rd] Generation Opcon Powerbox, through signing customers and developing partnerships to implement the technology. These activities were focused in Australia.

4. Operating and financial review

Operating Review

During the year the consolidated entity’s operations involved the development of its green power utility business by pursuing the acquisition of customers and the development of industry relationships.

The company’s inaugural customer, the Western Australian government owned regional power utility, Horizon Power, entered into a memorandum of understanding in October 2010 for the supply of Enerji’s clean power to the town of Carnarvon.

The global construction company, Lang O’Rourke, signed a memorandum of understanding with Enerji in September 2010 to become the company’s preferred construction partner.

The Henderson reference project was abandoned due to there not being sufficient heat for a 3[rd] generation Opcon Powerbox and the fact that the need for a reference site in Australia was not required as these exist in Sweden.

Review of consolidated financial condition

The consolidated entity recorded an operating loss after income tax of $9,709,404 (2009: $7,408,206 loss). The loss including the following items of significance:

impairment of goodwill on acquisition of subsidiary -4,980,036
amortisation of distribution right acquired -959,624

The net assets of the consolidated entity were $6,981,558 (2009: $5,109,731).

As at balance date the Group had cash available of $484,527 and has established a Bond facility of $25,0000,000 to be used to finance the implementation of its green power utility service at customer sites. Cash From Operations

Enerji Limited

Directors’ report

For the year ended 31 December 2010

The net cash outflow from operations of $5,334,833 is significantly larger than the cash outflow in the previous year of $2,080,515. The cash outflow was mainly due to payments to suppliers and employees and reflects a full year of operation after the change in the nature of the business activities of the Company in 2009.

The net cash outflow from operations was funded by capital raisings of $2,535,970 on 17 January 2010 and a share placement of $250,000 on 11 October 2010. The cash balance at year end was $484,527.

Corporate Structure

Enerji is a company limited by shares that is incorporated and domiciled in Australia. Enerji has three fully owned subsidiaries Jamalcom Pty Ltd, Letharji Pty Ltd and Cogen Power Pty Ltd.

Capital Structure

As at the date of this report the Company had 640,311,761 fully paid ordinary shares and 64,737,700 options over ordinary shares on issue. The options have an exercise price of $0.20 and an expiry date of 31 December 2016.

5. Significant changes in the state of affairs

In September 2009 Enerji Limited exercised the call option, to acquire 100% of the shares in Jamalcom Pty Ltd at a consideration price of $5,000,000 to be met by issuing 41,701,418 fully paid shares in Enerji Limited. The acquisition was completed and the shares issued on 18 January 2010 once the company had complied with chapters 1 and 2 of the ASX Listing Rules, raised sufficient capital under the prospectus, and was relisted. The value of the 41,701,418 ordinary shares issued at that date was $8,340,284, based on the listed shared price of the Company at 18 January of $0.20 per share.

6. Dividends

There were no dividends paid or declared by the Company to members since the end of the previous financial year.

7. Events subsequent to reporting date

On the 2[nd] February the first drawdown was completed under the Bond Facility as approved by shareholders on 17 December 2010. The amount received was $999,989 and the funds were used to make progress payments on Opcon Powerbox orders, pay the expenses of the bond facility and replenish working capital.

Other than the matters discussed above there has not been since end of the financial year any item, transaction or event of a material and unusual nature likely, in the opinion of the directors of the Company, to affect significantly the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial years.

8. Likely developments

The directors foresee that the 2011 financial year will build on the positive results achieved during 2010 and continue the focus on:

Acquisition of new customers
Delivery of the Carnarvon town site project and subsequent customer projects based on the Opcon Powerbox;
Generating revenue;
Maintain administration costs at current levels.

Further information about likely developments in the operations of the Group and the expected results of those operations in future financial years has not been included in this report because disclosure of the information would be likely to result in unreasonable prejudice to the Group.

Enerji Limited

Directors’ report

For the year ended 31 December 2010

9. Share options

At the date of this report unissued ordinary shares of the Company under option are:

Expiry date Exercise price Number of shares 31 Dec 2016 $0.20 64,737,700

Shares issued on exercise of options

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 are no amounts unpaid on the shares issued):

Number of shares Amount paid on each share 7,540 $0.20

10. Remuneration report - Audited

Key management personnel have authority and responsibility for planning, directing and controlling the activities of the Company, including directors of the Company and other executives. During the reporting period key management personnel include directors Greg Pennefather (CEO), Ian Campbell (Chairman), Rolf Hasselström, Ross Smith and Samantha Tough. The company secretaries included Geoffrey Reid and Greg MacMillan. Ross Smith resigned on 19 February 2010. Samantha Tough resigned on 15 July 2010. Greg MacMillan resigned on 25 February 2011.

Compensation levels for key management personnel of the Company are set competitively to attract and retain appropriately qualified and experienced directors and senior executives.

The compensation structures for executives are designed to attract suitably qualified candidates, reward the achievement of strategic objectives and achieve the broader outcome of the creation of value for shareholders. The compensation structure takes into account the executives’ capability and experience, level of responsibility and ability to contribute to the Company’s performance, including, in particular, the establishment of revenue streams and growth in the Company’s share price.

Fixed compensation consists of a base salary (calculated on a total cost basis, including any fringe benefits tax related to employee benefits) as well as employer contributions to superannuation funds. Compensation levels are reviewed annually by the remuneration committee through a process that considers individual and company achievement.

There was no performance linked remuneration during the reporting period. All securities issues to Key management and executive directors are approved by the shareholders in general meeting and no performance hurdles were included. This provides the only link between remuneration and shareholder wealth.

The Company changed its business during the reporting period so there is only a short history of the compensation structure. The remuneration committee and the directors consider that the Company’s progress to date and the share price levels achieved do not provide any indication that the compensation structure is inappropriate.

The key management person of the Company as at the date of this report being:

Greg Pennefather, who is a full time employee, is employed under an executive services agreement and there is no specific term under the agreement. Greg Pennefather may terminate the agreement without cause by giving written notice of three months and the Company may terminate the agreement by giving written notice of 12 months or a termination payment of 12 months fees.

Ian Campbell is employed under a non-executive services agreement, which requires a commitment of a minimum 20 days a year. Mr Campbell may terminate the agreement without cause by giving written notice and the Company may terminate the agreement should, for any reason, Mr Campbell is disqualified or prohibited by law from being or acting as a director or from being involved in the management of a company.

Enerji Limited

Directors’ report

For the year ended 31 December 2010

Rolf Hasselström is employed under a non-executive services agreement, which requires a commitment of a minimum 20 days a year. Mr Hasselström may terminate the agreement without cause by giving written notice and the Company may terminate the agreement should, for any reason, Mr Hasselström is disqualified or prohibited by law from being or acting as a director or from being involved in the management of a company.

Samantha Tough was employed under a non-executive services agreement, which requires a commitment of a minimum 20 days a year. Ms Tough may terminate the agreement without cause by giving written notice and the Company may terminate the agreement should, for any reason, Ms Tough is disqualified or prohibited by law from being or acting as a director or from being involved in the management of a company. Ms Tough resigned on 15 July 2010.

Ross Smith, who was a full time employee, was employed under an executive services agreement and there is no specific term under the agreement. Mr Smith was able to terminate the agreement without cause by giving written notice of three months and the Company was able to terminate the agreement by giving written notice of 12 months or a termination payment of 12 months fees. Mr Smith resigned on 11 March 2010.

Geoffrey Reid, who is a full time employee, is employed under an employment contract, there is no specific term under the agreement. Mr Reid may terminate the agreement without cause by giving written notice of one month and the Company may terminate the agreement by giving written notice of one month.

The aggregate cash remuneration of all non-executive directors was set at $400,000 per annum at a general meeting held on 1 December 2009. The Company makes contributions at the statutory minimum rate to superannuation funds nominated by directors, in addition to the base fee. Directors’ fees cover all main board activities and committee memberships. All securities issues to non-executive directors are approved by the shareholders in general meeting.

Enerji Limited

Directors’ report

For the year ended 31 December 2010

Details of the nature and amount of each element of remuneration of each director (including key management personnel) of the Company and the group are:

		Short Term	Benefits	Post Employment	Post Employment
				Benefits
		Salary &	Non-	Super-	Termin	Share and	Total	%
		fees $	monet	annuati	ation	options	$	perfor
			ary	on	Paymen	based		mance
			benefits $		t $	payments 1		related
						$
Directors
Non-executive
Ian Campbell
(Chairperson)	2010	113,750	-	9,224	-	-	122,974	-
(appointed 19
Nov 09)	2009	11,539	-	1,038	-	-	12,577	-
Rolf
Hasselström	2010	50,004	-	-	-	-	50,004	-
(appointed 7
Sep 09)	2009	15,696	-	-	-	386,600	402,296	96.1
Executive
Greg
Pennefather,
CEO	2010	250,000	10,000	22,500	-	-	282,500	-
(appointed 4 Jun
09)	2009	143,521	-	12,825	-	1,875,000	2,031,346	92.3
Former
Samantha
Tough	2010	36,963	-	2,651	-	-	39,614	-
(appointed 23
Feb 10,	2009	-	-		-	-	-	-
resigned 15 Jul
10)
Guy Le Page	2010	9,615	-	-	-	-	9,615	-
(appointed 20
Mar 09,	2009	26,853	-	-	-	185,141	211,994	87.3
resigned 12 Mar
10)						-	-	-
Ross Smith	2010	31,442	-		430,750	-	462,192	-
(appointed 20
Mar 09,	2009	267,584	-		-	1,272,641	1,540,225	82.6
resigned 11 Mar
10)
Greg MacMillan2	2010	90,000	-	-	-	-	90,000	-
(appointed 2	2009	18,000	-	-	-	-	18,000	-
								6

Enerji Limited

Directors’ report

For the year ended 31 December 2010

Sep 09, resigned 25 Feb 11)

Company
Secretary
Geoffrey Reid3	2010	-	-	-	-	-	-	-
(appointed 25
		-	-	-	-	-	-	-
Feb 11,	2009
	2010	581,774	10,000	34,375	430,750	-	1,056,899
	2009	483,193	-	13,863	-	3,719,382	4,216,438

1 No share and options based payments were made to directors in 2010

2 Mr MacMillan was paid through consulting company Australian Heritage Group.

3 No remuneration was received by Mr Reid in the position of company secretary, as appointment after 31 December 2010.

There were no non monetary, long term or performance benefits received by key management and the directors, accordingly this information is not included in the above table.

The overall level of key management personnel and director compensation would normally take into account the performance of the Group over a number of years. In 2009, there was a material change in the nature of the business of the Group and all key management personnel and directors have changed, accordingly there has been no historical performance analysis of the Group and remuneration provided.

The shares and options were issued as an alternate remuneration to cash, to provide consideration for their ongoing commitment and contribution to the Company. As such there was no employment performance conditions related to the shares and options or cash remuneration provided during the period.

The Board does not have a policy that restricts the holders of securities issued as share based payments as part of their remuneration from entering into other arrangements that limit their exposure to losses that would result from share price decreases. The Board is not aware of any holder entering into any such arrangements.

On 19 February 2010 Ross Smith resigned as Chief Executive Officer and received a cash termination payment of $430,750. This amount was approved by the Board of Directors and based on 18 months salary. On 11 March 2010 Ross Smith resigned as a Director of the Company.

No options over ordinary shares in the Company that were granted as compensation to directors during the reporting period.

Other than noted above no terms of equity-settled share based payment transactions (including options granted as compensation to a key management person or director) have been altered or modified by the Company during the reporting period.

During the reporting period no payments were made to a person before the person took office as part of the consideration for the person agreeing to hold office.

The relative proportions of remuneration that are linked to performance and those that are fixed are as follows:

Name	Fixed	remuneration	At	risk - STI		At risk - LTI
	2010	2009	2010	2009	2010	2009

Enerji Limited

Directors’ report

For the year ended 31 December 2010

Executive directors of Enerji Ltd
I Campbell 100%	100%	-	-	-	-
R Hsselström 100%	100%	-	-	-	-
Other key management personnel of the	group
G Pennefather 100%	100%	-	-	-	-
Other company and group executives
G Reid 100%	100%	-	-	-	-

Service agreements

On appointment to the board, all non-executive directors enter into a service agreement with the company in the form of a letter of appointment. The letter summarises the board policies and terms, including compensation, relevant to the office of director.

Remuneration and other terms of employment for the managing director are also formalised in a service agreement. The agreement provides for the provision of performance related bonuses, other benefits including car allowance and participation, when eligible, in the Enerji Ltd Employee Option Plan. Other major provisions of the agreement relating to remuneration are set out below.

		Base salary
Name	Term of Agreement	including superannuation1	Termination benefit 2
GD Pennefather, Managing			12 months base
director	Not specified	272,500	salary

1 Base salary quoted are for the year ended 31 December 2010; it is reviewed annually by the remuneration committee

2 Termination benefits are payable on early termination by the company; other than for gross misconduct, unless otherwise indicated.

This is the end of the Audited Remuneration Report.

11. Directors’ interests

The relevant interest of each director in the shares and options issued by the Company, as notified by the directors to the ASX in accordance with S205G(1) of the Corporations Act 2001, at the date of this report is as follows:

ollows:
	Ordinary shares	Options over
		ordinary shares
I Campbell	-	-
G Pennefather1	54,201,418	1,500,000
R Hasselström	4,000,000	400,000

! 15,000,000 of the shares and 1,500,000 of the options are held by Jamalexal Pty Ltd of which Mr Pennefather is a director, shareholder, and beneficiary.

All of the options held by directors at the date of this report were received in their capacity as shareholders of the Company pursuant to the bonus options issue completed on 21 December 2009.

Enerji Limited

Directors’ report

For the year ended 31 December 2010

Shareholder approval was obtained at the AGM on 31 May 2010 for the company, at it’s discretion, issue 4,000,000 shares each to Ian Campbell and Samantha Tough. As at 31 December the shares had not been issued. Samantha Tough resigned on the 15[th] July 2010, and as such will not be issued shares.

12. Directors’ meetings

The number of directors’ meetings (including meetings of committees of directors) and number of meetings attended by each of the directors of the Company during the financial year are:

Director		Board		Audit	Remuneration	Remuneration
	Meetings		Committee		Committee
			Meetings		Meetings
	A	B	A	B	A	B
Ian Campbell	6	6	1	1	-	-
Greg Pennefather	6	6	1	1	-	-
Rolf Hasselström	6	6	1	1	-	-
Samantha Tough	3	3	-	-	-	-
Guy Le Page	1	2	-	-	-	-
Ross Smith	1	1	-	-	-	-

A - Number of meetings attended, B - Number of meetings held during the time the director held office during the year. The remuneration committee have only recently been formed. During the financial year the Board, as a whole, dealt with areas that would normally fall within the charge of the remuneration committee and as such there were no specific remuneration committee meetings held.

13. Indemnification and insurance of officers and auditors Indemnification

The Company has not during the reporting period, other than noted below, in respect of any person who is or has been a director, officer or auditor of the Company indemnified or made any relevant agreement for indemnifying against a liability incurred as a director or officer including costs and expenses of successfully defending legal proceedings.

The Company has on 12 March 2010 agreed to indemnify the current directors of the Company as at the date of this report against all liabilities to another person (other than the Company or a related body corporate) that may arise from their position as directors of the company and its controlled entities, except where the liability arises out of conduct involving a lack of good faith. The agreement stipulates that the Company will meet the full amount of any such liabilities, including costs and expenses.

The Company has also agreed to indemnify the current directors of its controlled entities for all liabilities to another person (other than the Company or a related body corporate) that may arise from their position, except where the liability arises out of conduct involving a lack of good faith. The agreement stipulates that the Company will meet the full amount of any such liabilities, including costs and expenses.

The Company, during the reporting period, paid insurance premiums in respect of directors’ and officers’ liability and legal expenses’ insurance contracts.

14. Environmental regulation and performance

The Consolidated Entity is not currently subject to any specific environmental regulations. There have not been any known significant breaches of any environmental regulations during the year under review and up to the date of this report.

Enerji Limited

Directors’ report

For the year ended 31 December 2010

15. 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 a party to such proceedings during the year. The dispute involved Goldenwire Investments Pty Ltd (ACN 089 370 347), a company associated with former director, Colin Barboutis, as Trustee for the Goldenwire Trust (Goldenwire) making allegations of default against the Company in relation to a convertible note agreement, which the Company denied. Enerji does not admit liability in the matter but opted to proceed with an out of court settlement amounting to $120,000 in cash and 15,000,000 in ERJ shares, which is significantly lower than the original claim amount and associated costs.

16. Corporate governance statement

In recognizing the need for the highest standards of corporate behavior and accountability, the directors support the principles of good corporate governance. The Company’s Corporate Governance Statement is contained at the end of the annual report.

17. Lead auditor’s independence declaration

The Lead auditor’s independence declaration is set out on page 45 and forms part of the directors’ report for the financial year ended 31 December 2010.

18. Auditors’ remuneration

There were no non audit services provided by the auditors during the reporting period. The auditors’ remuneration is disclosed in Note 28 to the financial statements.

This report is made with a resolution of the directors:

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Greg Pennefather Director Dated 31 March 2011

Enerji Limited

Statement of financial position

As at 31 December 2010

*Note* Assets Cash and cash equivalents 8 Other receivables 9 Total current assets Prepayments 9 Property, plant and equipment 10 Intangible assets 11 Total non-current assets Total assets Liabilities Trade and other payables 12 Provisions 13 Total current liabilities Deferred tax liabilities 14 Total non-current liabilities Total liabilities Net assets Equity Issued capital 15 Reserves 16 Accumulated losses Total equity attributable to members of Enerji Limited	Consolidated 2010 2009 484,527 3,523,580 47,585 7,610
	532,112 3,531,190
	5,741,022 1,938,580 268,280 107,824 4,040,376 -
	10,049,678 2,046,404

	10,581,790 5,577,594
	2,041,432 467,863 58,800 -
	2,100,232 467,863
	1,500,000 -
	1,500,000 -

	3,600,232 467,863

	6,981,558 5,109,731
	47,760,410 36,262,679 5,015,238 4,931,738 (45,794,090) (36,084,686)
	6,981,558 5,109,731

The notes on pages 15 to 41 are an integral part of these consolidated financial statements.

Enerji Limited

Statement of comprehensive income

For the year ended 31 December 2010

*Note* Revenue Continuing operations Realised foreign exchange gains Employment costs 17 Directors payments Director payments on termination Share based payments 18 Consulting and professional costs Depreciation and amortisation 19 Impairment of assets 20 Travel costs Corporate fees Settlement of obligations 21 Other expenses Finance income 22 Finance costs Loss before income tax Income tax expense 23 Loss from continuing operations Loss for the period Other comprehensive income for the period, net of income tax Total comprehensive income for the period Loss and comprehensive income for the period Loss per share Basic loss per share Diluted loss per share		Consolidated 2010 2009 - - 6,229 - (861,024) (279,028) (616,149) (684,531) (430,750) - (583,500) (4,551,078) (663,129) (555,960) (975,469) (6,389) (4,980,036) (100,000) (182,396) (376,294) (176,323) (133,464) (120,000) (357,624) (351,217) (414,073) 74,274 50,235 - -
		(9,859,490) (7,408,206) 150,086 -
		(9,709,404) (7,408,206)
		(9,709,404) (7,408,206)
		- -
		(9,709,404) (7,408,206)

		(9,709,404) (7,408,206)
		($0.016) ($0.028) n/a n/a

The notes on pages 15 to 41 are an integral part of these consolidated financial statements.

Enerji Limited

Statement of changes in equity

For the year ended 31 December 2010

Consolidated *Note* Balance at 1 January 2009 Total comprehensive income for the period Loss for the year Total comprehensive income for the period Transactions with owners, recorded directly in equity Contributions by and distributions to owners Issue of ordinary shares related to business combination 15 Issue of ordinary shares, net of costs 15 Conversion of convertible notes 15 Share-based payment transactions 18 Share options exercised 15 Total transactions with owners Balance at 31 December 2009	Attributable to equity holders of the Company Share capital Share based payment reserve Accumulated losses Total equity 28,644,962 380,660 (28,676,480) 349,142
	- - (7,408,206) (7,408,206)
	- - (7,408,206) (7,408,206)
	172,500 - - 172,500 4,972,899 - - 4,972,899 525,000 - - 525,000 - 4,551,078 - 4,551,078 1,947,318 - - 1,947,318
	7,617,717 4,551,078 - 12,168,795
	36,262,679 4,931,738 (36,084,686) 5,109,731
Balance at 1 January 2010 Total comprehensive income for the period Loss for the year Total comprehensive income for the period Transactions with owners, recorded directly in equity Contributions by and distributions to owners Issue of ordinary shares related to business combination 15 Issue of ordinary shares, net of costs 15 Share-based payment transactions 18 Share options exercised 15 Total transactions with owners Balance at 31 December 2010	36,262,679 4,931,738 (36,084,686) 5,109,731
	- - (9,709,404) (9,709,404)
	- - (9,709,404) (9,709,404) 8,340,284 - - 8,340,284 2,655,939 83,500 - 2,739,439 500,000 - - 500,000 1,508 - - 1,508
	11,497,731 83,500 - 11,581,231
	47,760,410 5,015,238 (45,794,274) 6,981,558

The notes on pages 15 to 41 are an integral part of these consolidated financial statements.

Enerji Limited

Statement of cash flows

For the year ended 31 December 2010

*Note* Cash flows from operating activities Cash paid to suppliers and employees Net cash used in operating activities 25 Cash flows from investing activities Interest received Acquisition of subsidiary, net of cash acquired 7 Acquisition of property, plant and equipment (Loans to) / repayments from related party Prepayments for acquisition of property, plant and equipment Net cash used in investing activities Cash flows from financing activities Proceeds from issue of share capital Proceeds from issue of convertible notes Proceeds from exercise of share options Payment of transaction costs Proceeds from issue of share capital received in advance Net cash from financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at 1 January Cash and cash equivalents at 31 December 8		Consolidated 2010 2009 (5,334,833) (2,080,515)
		(5,334,833) (2,080,515)
		74,274 50,235 - (150,000) (176,301) (112,627) 1,938,580 (1,938,580) (2,198,220) -
		(361,667) (2,150,972)
		2,785,970 5,365,440 - 525,000 1,508 1,947,319 (130,031) (392,541) - 34,000
		2,657,447 7,479,218
		3,039,053 3,247,731 3,523,580 275,849
		484,527 3,523,580

The notes on pages 15 to 41 are an integral part of these consolidated financial statements.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

1. Reporting entity

Enerji Limited (the “Company”) is a company domiciled in Australia. The address of the Company’s registered office is Level 22 Allendale Square, 77 St Georges Tce, Perth WA 6000. The consolidated financial statements of the Company as at and for the year ended 31 December 2010 comprise the Company and its subsidiaries (together referred to as the “Group” and individually as “Group entities”). The Group primarily is involved in the international marketing of energy recovery and clean energy generation solutions.

2. Basis of preparation

(a) Statement of compliance

The financial statements are general purpose financial statements which have been prepared in accordance with Australian Accounting Standards (AASBs) (including Australian Interpretations) adopted by the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. The consolidated financial statements of the Group comply with International Financial Reporting Standards (IFRSs) and interpretations adopted by the International Accounting Standards Board (IASB).

(b) Basis of measurement

The consolidated financial statements have been prepared on the historical cost basis.

(c) Functional and presentation currency

These consolidated financial statements are presented in Australian dollars, which is the Company’s and each of it’s subsidiary’s functional currency.

(d) Use of estimates and judgements

The preparation of financial statements in conformity with AASBs requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

Information about assumptions and estimations are included in:

Note 7 Acquisition of subsidiary – The fair value of the intangible was measured using the agreed price as set out in the call option, as exercised on 14 September 2009. This price being $0.11.

Note 16 Share based payments – measured using Black-Scholes formula. The assumptions used in the model are disclosed in note 16.

Note 17 Impairment – calculated as the difference between asset carrying costs and the present value of the estimated future cash flows discounted at the asset’s original effective rate

(e) Changes in accounting policies

No changes to the Group’s accounting policies for the year.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

3. Significant accounting policies

The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements, and have been applied consistently by Group entities.

The company and group have adopted the following accounting standards and amendments:

Revised AASB 3 Business Combinations (2008)
Amended AASB 127 Consolidated and Separate Financial Statements (2008)

(a) Basis of consolidation

(i) Business combinations

The acquisition method of accounting is used to account for all business combinations, including business combinations involving entities or businesses under common control, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the fair values of the assets transferred, the liabilities incurred and the equity interests issued by the group. The consideration transferred also includes the fair value of any contingent consideration arrangement and the fair value of any pre-existing equity interest in the subsidiary. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the group recognises any non-controlling interest in the acquiree, either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net identifiable assets.

The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the group’s share of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the subsidiary acquired and the measurement of all amounts has been reviewed, the difference is recognised directly in profit or loss as a bargain purchase.

Measuring goodwill

The Group measures goodwill as the fair value of the consideration transferred less fair value of the identifiable assets acquired and liabilities assumed, all measured as of the acquisition date.

Consideration transferred includes the fair values of the assets transferred, liabilities incurred by the Group to the previous owners of the acquiree, and equity interests issued by the Group. Consideration transferred also includes the fair value of any contingent consideration.

Contingent liabilities

A contingent liability of the acquiree is assumed in a business combination only if such a liability represents a present obligation and arises from a past event, and its fair value can be measured reliably.

Transaction costs

Transaction costs that the Group incurs in connection with a business combination, such as finder’s fees, legal fees, due diligence fees, and other professional and consulting fees, are expensed as incurred.

(ii) Subsidiaries

Subsidiaries are entities controlled by the Group. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted by the Group. In the Company’s financial statements, investments in subsidiaries are carried at cost.

(iii) Transactions eliminated on consolidation

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

(b) Foreign currency

(i) Foreign currency transactions

Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the exchange rate at that date. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined.

(c) Financial instruments

(i) Non-derivative financial assets

The Group initially recognises loans and receivables and deposits on the date that they are originated. All other financial assets (including assets designated at fair value through profit or loss) are recognised initially on the trade date at which the Group becomes a party to the contractual provisions of the instrument.

The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows on the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in transferred financial assets that is created or retained by the Group is recognised as a separate asset or liability.

Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

The Group has the following non-derivative financial assets.

Loans and receivables

Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition loans and receivables are measured at amortised cost using the effective interest method, less any impairment losses. Loans and receivables comprise trade and other receivables.

(ii) Non-derivative financial liabilities

The Group recognises financial liabilities (including liabilities designated at fair value through profit or loss) are recognised initially on the trade date at which the Group becomes a party to the contractual provisions of the instrument. The Group derecognises a financial liability when its contractual obligations are discharged or cancelled or expire. Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

The Group has non-derivative financial liabilities comprising trade and other payables which are recognised initially at fair value and subsequently at amortised cost.

(iii) Share capital

Ordinary shares

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

(d) Cash and cash equivalents

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Cash and cash equivalents in the statement of financial position comprise cash at bank and in hand and short-term deposits with an original maturity of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as defined above.

(e) Property, plant and equipment

(i) Recognition and measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses.

Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of selfconstructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the assets to a working condition for their intended use, the costs of dismantling and removing the items and restoring the site on which they are located, and capitalised borrowing costs. Cost also may include transfers from other comprehensive income of any gain or loss on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and are recognised net within other income in profit or loss.

(ii) Subsequent costs

The cost of replacing a part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group, and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.

(iii) Depreciation

Depreciation is calculated over the depreciable amount, which is the cost of an asset, or other amount substituted for cost, less its residual value.

Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment, since this most closely reflects the expected pattern of consumption of the future economic benefits embodied in the asset.

The estimated useful lives for the current and comparative periods are as follows:

Plant and equipment 5 years

• Computers 4 years • Fixtures and fittings 10 years • Major components 10 - 15 years.

Depreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate.

(f) Leases

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Operating lease payments are recognised as an operating expense in the statement of comprehensive income on a straight-line basis over the lease term.

(g) Intangible assets

(i) Goodwill

Goodwill is measured at cost less accumulated impairment losses.

(ii) Research and development

Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is recognised in profit or loss as incurred.

Development activities involve a plan or design for the production of new or substantially improved products and processes. Development expenditure is capitalised only if development costs can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable, and the Group intends to and has sufficient resources to complete development and to use or sell the asset. The expenditure capitalised includes the cost of materials, direct labour and overhead costs that are directly attributable to preparing the asset for its intended use, and capitalised borrowing costs. Other development expenditure is recognised in profit or loss as incurred.

Capitalised development expenditure is measured at cost less accumulated amortisation and accumulated impairment losses.

(iii) Amortisation

Amortisation is recognised in the profit and loss on a straight-line basis over the estimated useful lives of the intangible assets from the date they are available for use unless such lives are indefinite. Goodwill and intangible assets with an indefinite useful life are not amortised but systematically tested for impairment annually. The estimated useful lives for the current and comparative periods are as follows:

Distribution Licence 5 years

(h) Leased assets

Leases in terms of which the Group assumes substantially all the risks and rewards of ownership are classified as finance leases. Upon initial recognition the leased asset is measured at an amount equal to the lower of its fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset.

Other leases are operating leases and, are not recognised in the Group’s statement of financial position.

(i) Impairment

(i) Financial assets (including receivables)

A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated future cash flows of that asset that can be estimated reliably.

Objective evidence that financial assets (including equity securities) are impaired can include default or delinquency by a debtor, restructuring of an amount due to the Group on terms that the Group would not consider otherwise, indications that a debtor or issuer will enter bankruptcy, the disappearance of an active market for a security. In addition, for an investment in an equity security, a significant or prolonged decline in its fair value below its cost is objective evidence of impairment.

The Group considers evidence of impairment for receivables at both a specific asset and collective level. All individually significant receivables are assessed for specific impairment. All individually significant receivables found not to be specifically impaired are then collectively assessed for any impairment that has been incurred but not yet identified.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

In assessing collective impairment the Group uses historical trends of the probability of default, timing of recoveries and the amount of loss incurred, adjusted for management’s judgement as to whether current economic and credit conditions are such that the actual losses are likely to be greater or less than suggested by historical trends.

An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate. Losses are recognised in profit or loss and reflected in an allowance account against receivables. Interest on the impaired asset continues to be recognised through the unwinding of the discount. When a subsequent event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss.

(ii) Non-financial assets

The carrying amounts of the Group’s non-financial assets, other than inventories and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. For goodwill, and intangible assets that have indefinite useful lives or that are not yet available for use, the recoverable amount is estimated each year at the same time.

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the “cash-generating unit”). Subject to an operating segment ceiling test, for the purposes of goodwill impairment testing, CGUs to which goodwill has been allocated are aggregated so that the level at which impairment is tested reflects the lowest level at which goodwill is monitored for internal reporting purposes. Goodwill acquired in a business combination is allocated to groups of CGUs that are expected to benefit from the synergies of the combination.

The Group’s corporate assets do not generate separate cash inflows. If there is an indication that a corporate asset may be impaired, then the recoverable amount is determined for the CGU to which the corporate asset belongs.

An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the units, and then to reduce the carrying amounts of the other assets in the unit (group of units) on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

(j) Employee benefits

(i) Termination benefits

Termination benefits are recognised as an expense when the Group is demonstrably committed, without realistic possibility of withdrawal, to a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies are recognised as an expense if the Group

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

has made an offer of voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptances can be estimated reliably. If benefits are payable more than 12 months after the reporting period, then they are discounted to their present value.

(ii) Employee leave benefits

Wages & salaries and annual leave liabilities for wages and salaries, including non-monetary benefits, are expected to be settled within 12 months of the reporting date and are recognised in respect of employees' services up to the reporting date. They are measured at the amounts expected to be paid when the liabilities are settled. Expenses for non-accumulating sick leave are recognised when the leave is taken and are measured at the rates paid or payable.

A liability is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(iii) Share-based payment transactions

The grant date fair value of share-based payment awards granted to employees is recognised as an employee expense, with a corresponding increase in equity.

Share-based payment arrangements in which the Group receives goods or services as consideration for its own equity instruments are accounted for as equity-settled share-based payment transactions, regardless of how the equity instruments are obtained by the Group.

(k) Provisions

A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as finance cost.

(l) Finance income and finance costs

Finance income comprises interest income on funds invested. Interest income is recognised as it accrues in profit or loss, using the effective interest method.

Finance costs comprise interest expense on borrowings, unwinding of the discount on provisions, and impairment losses recognised on financial assets. Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognised in profit or loss using the effective interest method.

Foreign currency gains and losses are reported on a net basis.

(m) Income tax

Income tax expense comprises current and deferred tax. Current and deferred tax are recognised in profit or loss except to the extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income.

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss,

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

and differences relating to investments in subsidiaries and associates and jointly controlled entities to the extent that it is probable that they will not reverse in the foreseeable future. In addition, deferred tax is not recognised for taxable temporary differences arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.

A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

Additional income tax expenses that arise from the distribution of cash dividends are recognised at the same time that the liability to pay the related dividend is recognised. The Group does not distribute noncash assets as dividends to its shareholders.

(n) Goods and services tax

Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the amount of GST incurred is not recoverable from the taxation authority. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability in the balance sheet.

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

(o) Earnings per share

The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding adjusted for the effects of all dilutive potential ordinary shares, which comprise convertible notes and share options granted to employees.

(p) Segment reporting

Determination and presentation of operating segments

The Group determines and presents operating segments based on the information that internally is provided to the CEO, who is the Group’s chief operating decision maker.

An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components. All operating segments’ operating results are regularly reviewed by the Group’s CEO to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available.

Segment results that are reported to the CEO include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly corporate assets (primarily the Company’s headquarters), head office expenses, and income tax assets and liabilities.

Segment capital expenditure is the total cost incurred during the period to acquire property, plant and equipment, and intangible assets other than goodwill.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

(q) New standards and interpretations not yet adopted

The following new/amended accounting standards and interpretations have been issued, but are not mandatory for financial years ended 31 December 2010 (or for late financial reports of earlier periods). They have not been adopted in preparing the financial statements for the year ended 31 December 2010 (or for late financial reports of earlier periods) and are not expected to impact the entity in the period of initial application.

AASB 9 (issued Financial Instruments December 2009)

Amends the Periods Due to the recent requirements for beginning on release of these classification and or after 1 amendments and that measurement of January adoption is only financial assets 2013 mandatory for the 30 June 2014 year end, the entity has not yet made an assessment of the impact of these amendments.

No further new/amended accounting standards or interpretations are applicable

4. Determination of fair values

A number of the Group’s accounting policies and disclosures require the determination of fair value, for financial assets and liabilities. Fair values have been determined for measurement and / or disclosure purposes based on the following methods. When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

(i) Share-based payment transactions

The fair value of options issued as share-based payment are measured using the Black-Scholes formula. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the instruments (based on historical experience and general option holder behaviour), expected dividends, and the risk-free interest rate (based on government bonds).

The fair value of performance shares issued as share-based payment is based on the fair value of performance options granted, which is measured using a Black-Scholes formula. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the instruments (based on historical experience and general option holder behaviour), expected dividends, and the risk-free interest rate (based on government bonds).

The fair value of the shares issued as share-based payment are measured based on the share price on the date of issue.

5. Financial risk management

The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework. The executive directors are responsible for developing and monitoring risk management policies and report regularly to the Board of Directors on their activities. Details of credit risk, liquidity risk, currency risk, interest rate risk and capital management are disclosed in Note 29 to the financial statements.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

6. Segment information

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.

The Group considers the business from a geographic perspective, which at present is only Australia.

(a) Segment information provided to chief operating decision maker for 2010:

2010	Australia
Total segment revenue	-
Revenue from external customers	-
Net loss before tax	9,713,588
Total segment assets	10,577,606
Total segment liabilities	3,600,232

(b) Segment information provided to chief operating decision maker for 2009:

2009	Australia
Total segment revenue	-
Revenue from external customers	-
Net loss before tax	7,408,206
Total segment assets	5,577,594
Total segment liabilities	467,863

(c) Other segment information

The reporting of only one segment results in no intersegment eliminations.

7. Business Combination

(a) Summary of acquisition

On 18 January 2010 the parent entity acquired 100% of the issued share capital of Jamalcom Pty Ltd, the holder of the exclusive distribution licence for Opcon Powerboxes in Australia. The acquisition has allowed the parent entity to roll out the business model with the licence secured within the group. Details of the purchase consideration, the net assets acquired are as follows:

Purchase consideration (refer to (b) below):

Issue of fully paid ordinary shares 8,340,284

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Total purchase consideration

8,340,284

The assets and liabilities recognised as a result of the acquisition are as follows. These assets have been recognised provisionally at reporting date as accounting is incomplete relating to fair value adjustments and potential tax effect upon consolidation of the assets and liabilities.

Assets and liabilities Distribution licence Deferred tax liability Net assets acquired Write-off of excess consideration / goodwill	Fair value 2010 2009 $ $ - - 5,000,000 - (1,500,000) -
	3,500,000 -

	4,840,284 100,000

The distribution licence is attributable to the exclusive agreement signed by Jamalcom Pty Ltd with Opcon AB, the supplier of the Opcon Powerbox.

(b) Purchase consideration – cash outflow

No cash outflow occurred on this transaction, as it was completed through the issue of shares in the parent entity.

In 2009, the Company entered into a Put and Call Option Deed with the sole shareholder (CoGen) of Jamalcom Pty Ltd. CoGen holds the exclusive rights to market the Opcon Powerbox system in Australia. On September 2009, the company excerised it’s Call Option. The purchase consideration pursant to the excerise of the call options was $5,000,000 to be satisfied by the issue of 41,701,418 shares.

The acquisition of Jamalcom was completed and the shares issued on 18 January 2010. At this date the value of the 41,701,418 ordinary shares was $8,340,284. The fair value was assessed at $5,000,000 which resuls in a deferred tax liability of $1,500,000.

The Distribution agreement with Opcon provides Enerji with the exclusive rights to distribute the Opcon Powerboxes in Australia for a period of 5 years.

At 30 June 2010, the goodwill was fully impaired. The recoverability was reassessed at 31 December 2010 and this resulted in the impairment being reversed.

8. Cash and cash equivalents

. Cash and cash equivalents
Bank balances Cash and cash equivalents Cash and cash equivalents in the statement of cash flows	Consolidated 2010 2009 484,527 3,523,580
	484,527 3,523,580
	484,527 3,523,580

9. Other receivables

Consolidated 2010 2009

Current receivables

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Other receivables Non-current receivables Prepayments – Opcon Powerboxes Loans to related party	47,585 7,610
	47,585 7,610
	5,741,022 - - 1,938,580
	5,741,022 1,938,580

During 2010, unsecured prepayments totalling $2,198,220 (2009: nil) have been made to Opcon AB for 6 3[rd] Generation Powerboxes ordered. Invoices were received in December 2010 for further progress payments on Opcon Powerboxes totalling $1,787,960. An additional prepayment of $1,754,842 was acquired through the acquisition of Jamalcom.

No receivables have been impaired during the period.

Refer to note 29, for information on the risk management policy of the group and the credit quantity of the entities trade receivables.

10. Property, plant and equipment

Cost Balance at 1 Jan 2009 Additions Disposals Balance at 31 Dec 2009 Balance at 1 Jan 2010 Additions Disposals Balance at 31 Dec 2010 Depreciation Balance at 1 Jan 2009 Depreciation for the year Disposals Balance at 31 Dec 2009 Balance at 1 Jan 2010 Depreciation for the year	Consolidated Plant and equipment Fixtures and fittings Total 6,432 - 6,432 69,007 43,620 112,627 (6,432) - (6,432)
	69,007 43,620 112,627
	69,007 43,620 112,627 174,372 1,929 10,739 - - -
	243,379 45,549 123,366
	Consolidated Plant and equipment Fixtures and fittings Total 1,313 - 1,313 5,871 527 6,398 (2,908) - (2,908)
	4,276 527 4,803
	4,276 527 4,803 12,497 3,348 15,845

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

- -	-	-
16,773 3,875	20,648
Consolidated Plant and equipment Fixtures and fittings 5,119 - 64,731 43,093	Total 5,119 107,824
64,731 43,093 226,606 41,674	107,824 268,280
	Patents, trademarks and other rights - - - -
	-
	- -
	-
	- 5,000,000
		959,624
	4,040,376
	5,000,000 959,624

11. Intangible assets

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Net book amount

4,040,376

(a) Impairment tests for goodwill

Goodwill is allocated to the group’s cash-generating unit (CGU) identified according to country of operation.

The recoverable amount of a CGU is determined based on value-in-use calculations. These calculations use cash flow projections based on financial budgets approved by management covering a five-year period. Cash flows beyond the five-year period are extrapolated using the estimated growth rates stated below. The growth rate does not exceed the long-term average growth rate for the business in which the CGU operates.

(b) Key assumptions used for value-in-use calculations

CGU	Electricity	price*		Growth	rate**		Discount	rate***
	2010	2009		2010	2009		2010	2009
	kW/hr	kW/hr		%	%		%	%
Australia	$0.20		-	5.0		-	15.0		-

Budgeted Electricity price taking into account current industry prices

** Weighted average growth rate used to extrapolate cash flows beyond the budget period

*** In performing the value-in-use calculations for the CGU, the group has applied post-tax discount rates to discount the forecast future attributable post-tax cash flows.

These assumptions have been used for the analysis. Management determined budgeted electricity prices through industry research and discussions with customers within the market place. The discount rate used reflects specific risks relating to the segment.

Recoverability is assumed on the basis of further power purchase agreements.

(c) Impact of possible changes in key assumptions

The budgeted electricity price used in the value-in-use calculation is sensitive to the world oil price.

12. Trade and other payables

Trade payables Other payables Capital raising funds received in advance Employee related payables	Consolidated 2010 2009 1,817,455 285,508 180,825 146,497 - 34,000 43,152 1,858 2,041,432 467,863

13. Provisions - current

Employee	Consolidated 2010 2009 58,800 -
	58,800 -

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

The entire amount of the employee provision is presented as current, since the group does not have an unconditional right to defer settlement for any of these obligations. However, based on past experience, the group does not expect all employees to take the full amount of accrued leave or require payment within the next 12 months. The following amounts reflect leave that is not to be expected to be taken or paid within the next 12 months.

Leave obligations expected to be settled after 12 months 4. Non-current liabilities – Deferred tax liabilities The balance comprises temporary differences attributable to: Acquisition of subsidiary Total deferred tax liabilities Deferred tax liabilities expected to be settled after more than 12 months Movements - Consolidated At 1 January 2009 At 31 December 2009 Acquisition of subsidiary At 31 December 2010	Consolidated 2010 2009 40,316 - Consolidated 2010 2009 1,500,000 -	Consolidated 2010 2009 40,316 - Consolidated 2010 2009 1,500,000 -
	1,500,000	-

	1,500,000	-
		Total $ - -
		1,500,000
		1,500,000

14. Non-current liabilities – Deferred tax liabilities

15. Share capital

5. Share capital
	Ordinary	shares	Ordinary	shares
	2010	2009	2010	2009
	#	#	$	$
On issue / balance at 1 January	534,052,108	84,943,879	36,262,679	28,644,962
Issued for cash	25,179,849	275,241,429	2,785,970	5,339,190
Costs for shares issued for cash	-	-	(130,031)	(392,541)
Issued for services	2,500,000	11,118,025	50,000	26,250
Issued for directors compensation	-	15,000,000	-	-
Issued on conversion of performance shares	-	15,000,000	-	-

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Issued on conversion of convertible notes Issued on acquisition of subsidiary Issued as settlement costs Exercise of share options On issue at 31 December	- 66,338,110 - 525,000 41,701,418 - 8,340,284 - 15,000,000 1,500,000 450,000 172,500 7,541 64,910,665 1,508 1,947,318
	618,440,916 534,052,108 47,760,410 36,262,679

The shares issued for services were issued for third party services. No funds were received on their issue. The shares issued for settlement costs are a result of the legal action with Goldenwire. No funds were received on their issue.

The shares issued on acquisition of a subsidiary is the acquisition of Jamalcom, the company that has the exclusive distribution agreement for the Opcon Powerbox. As a result of this purchase, the Group’s equity interest in Jamalcom is now 100% and enables the Group to own the distribution rights to Opcon Powerbox in Australia.

Details of options on issue are as follows:

On issue at 1 January Lapsed during the period Issued with shares issued for cash Issued for services Issued for directors compensation Issued on conversion of convertible notes Issued as bonus options Options exercised On issue / balance at 31 December	Number of Options 2010 2009 53,405,316 1,196,600 - (1,196,600) - 12,741,429 5,000,000 7,000,000 - 12,000,000 - 33,169,236 6,339,925 53,405,316
	64,745,241 118,315,981 (7,541) (64,910,665)
	64,737,700 53,405,316

All options on issue as at 31 December 2009 are exercisable at $0.20 and have an expiry date of 31 December 2016.

In December 2009 shareholders approved the issue:

! for cash 12,679,849 shares at $0.20 per share with 6,339,925 free attaching options with an exercise price of $0.20 each and expiry date of 31 December 2016. The attached options were issued at no additional cost and the total consideration has been allocated to issued capital or option reserve in accordance with the relative fair values being share capital of $1,214,665 net of costs and options valued at $1,191,272.

The fair value of the options issued in January 2010, has been measured at the grant date using a Black Scholes Model with the following inputs:

Fair value at grant date $0.188 Share price at grant date $0.20 Exercise Price $0.20 Expected volatility 128% Predicted Option life 184 days Risk-free interest rate 3.75%

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

for the acquisition of a subsidiary through the issue of 41,701,418 shares at nil consideration, This involved the purchase of Jamalcom Pty Ltd the owner of the distribution rights for the Opcon Powerbox.

During the reporting period 7,541 shares were issued as a result of the exercise of options at $0.20 per option.

In July 2010 directors approved the issue for settlement of legal action with Goldenwire of 15,000,000 shares for nil consideration. This was subsequently approved by shareholders on 17 December 2010. This issue of shares was accompanied by a cash payment of $120,000.

In October 2010 directors approved the issue for services 2,500,000 shares and 5,000,000 options for nil consideration. The options have an exercise price of $0.20 each and expiry date of 31 December 2016. This was subsequently approved by shareholders on 17 December 2010. The shares were valued at $0.02 per share and the options were valued using the Black-Scholes model resulting in a price of $0.017 per option, totalling $83,500.

In October 2010 directors approved the issue for cash 12,500,000 shares at $0.02 per share, the issue of shares was subsequently approved by shareholders on 17 December 2010. The price used was based on the share price on the day discounted for the beneficiary being a single party.

All issued shares are fully paid.

Ordinary shares

The Company does not have authorised capital or par value in respect of its issued shares. All issued shares are fully paid. The holders of ordinary shares are entitled to receive dividends as declared from time to time, and are entitled to one vote per share at meetings of the Company. All shares rank equally with regard to the Company’s residual assets.

Dividends

There were no dividends declared or paid during the reporting period.

16. Reserves

6. Reserves
AUD *Note* Balance at 1 January Compensation to directors - Shares 16 - Options 16 Payment for services - Shares 16 - Options 16 Balance at 31 December	Option Reserve Share Based Payment Reserve Total 2010 2009 2010 2009 2010 2009 380,660 380,660 4,551,078 - 4,931,738 380,660 - - - 2,962,500 - 2,962,500 - - - 757,082 - 757,082 - - - 507,500 - 507,500 - - 83,500 323,996 83,500 323,996
	380,660 380,660 4,634,578 4,551,078 5,015,238 4,931,738

The share based payment reserve represents the fair value of performance shares issued as share based payments for compensation to directors and for the provision of services.

The option reserve represents the fair value of options issued as option based payments for compensation to directors and for the provision of services.

17. Employment costs

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

AUD Wages and salaries Superannuation Professional appointment fees Other associated employment costs	Consolidated 2010 2009 627,087 133,845 55,818 12,046 52,096 67,746 126,023 65,391
	861,024 279,028

18. Share-based payments

AUD Compensation to directors Options Payment for services 12 Oct Options Settlement Shares Compensation to directors Shares Payment for services 12 Oct Shares	Consolidated 2010 2009 - 757,082 83,500 323,996 450,000 - - 2,962,500 50,000 507,500
	583,500 4,551,078

All share based payments during the period were equity settled transactions. All share based payments during the period were one off transactions approved by shareholders and were not part of any share or option plan. There were no share based payments commitments outstanding as at the beginning of the period (1 January 2010) or the end of the period (31 December 2010).

There were no performance hurdles on any share based payments during the period.

Options

On 11 October 2010 the following options were provided as share based payments. All options were approved by shareholders on 17 December 2010. As of balance date the options have not been converted into ordinary shares.

Payment for services	Number Value $ 5,000,000 83,500
	5,000,000 83,500

The grant date fair value of the options issued as share-based payment was measured based on the BlackScholes formula. Expected volatility is estimated by considering historic average share price volatility. The inputs used in the measurement of the fair values at grant date of the share-based payment plans are the following:

ollowing:
Fair value of share options and assumptions	2010
Fair value at grant date	$83,500
Share price at grant date	$0.0210
Exercise price	$0.20
Expected volatility (weighted average volatility)	138%
Option life (expected weighted average life)	81 days
Expected dividends	Nil
Risk-free interest rate (based on government bonds)	3.75%

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

On 11 July 2010 the following shares were provided as share based payment. All shares were approved by shareholders on 17 December 2010.

hareholders on 17 December 2010.
Payment on settlement of obligation	Number Value $ 15,000,000 450,000
	15,000,000 450,000

The grant date fair value of the shares issued as share-based payment was measured based on the share price on the date of issue.

n the date of issue.
Fair value of performance shares and assumptions	2010
Fair value at grant date	$450,000
Share price at grant date	$0.03
Consideration	Nil

On 11 October 2010 the following shares were provided as share based payment. All shares were approved by shareholders on 17 December 2010.

hareholders on 17 December 2010.
Payment for services	Number Value $ 2,500,000 50,000
	2,500,000 50,000

The grant date fair value of the shares issued as share-based payment was measured based on the share price on the date of issue.

n the date of issue.
Fair value of performance shares and assumptions	2010
Fair value at grant date	$50,000
Share price at grant date	$0.02
Consideration	Nil

19. Depreciation and amortisation

Property, plant and equipment Amortisation of Distribution rights 0. Impairment of assets *Note* Henderson Project Goodwill on acquisition 7 Impairment of loans and equity assets Other investment	Consolidated 2010 2009 15,845 6,398 959,624 -
	975,469 6,398
	Consolidated 2010 2009 139,752 - 4,840,284 - - - - 100,000
	4,980,036 100,000

20. Impairment of assets

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

In June 2010, Enerji agreed not to proceed with the implementation of an Opcon Powerbox at the Henderson Renewable Energy Facility following a Director’s decision that an Australian reference site is no longer necessary. As a result, the company has impaired the total cost incurred in the Henderson Project in the amount of $139,752.

21. Settlement costs

	Consolidated	Consolidated
*Note*	2010	2009
Goldenwire legal action	120,000	-
Subsidiary acquisition settlement cost	-	322,500
Loan advance expensed		35,124
	120,000	357,624
legal action against the company was negotiated and settled for a total value of $570,000 in July 20
ayment was made by way of $120,000 cash and the issue of 15,000,000 shares at a 5 day weighted avera
hare price resulting at a value of $450,000. The shares were issued with escrow periods		and conditi
ttached.
2. Finance income
	Consolidated
	2010	2009
Interest income on bank deposits	74,274	50,235
	74,274	50,235
3. Income tax expense
	Consolidated
	2010	2009
Current tax expense
Current period	150,086	-
	150,086	-

A legal action against the company was negotiated and settled for a total value of $570,000 in July 2010. Payment was made by way of $120,000 cash and the issue of 15,000,000 shares at a 5 day weighted average share price resulting at a value of $450,000. The shares were issued with escrow periods and conditions attached.

22. Finance income

23. Income tax expense

The income tax expense resulted from the receipt of a R&D tax offset. Under the R&D tax concession legislation, small companies can claim an R&D tax offset, section 73J of the Income Tax Assessment Act 1936 (ITAA 1936), that is, a refundable tax offset, equivalent to the value of certain deductions available under the R&D tax concession. For the 2010 year, total eligible R&D expenditure was $400,229, total section 73B of ITAA 1936 notional 125% R&D tax concession deduction was $500,286 therefore R&D tax offset refund entitlement @ 30% was $150,086.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Numerical reconciliation between tax expense and pre-tax accounting profit

*Note* Loss for the period Total income tax expense Loss excluding income tax Income tax using the Company’s domestic tax rate of 30 per cent (2009: 30 per cent) Non-deductible expenses Current year losses for which no deferred tax asset was recognised 20	Consolidated 2010 2009 8,209,404 7,408,206 - -
	8,209,404 7,408,206
	(2,462,821) (2,222,462) 2,150,546 1,749,157 312,275 473,305
	- -

24. Deferred tax assets

Unrecognised deferred tax assets

Deferred tax assets have not been recognised in respect of the following items:

Tax losses current period	Consolidated 2010 2009 312,275 473,305
	312,275 473,305

The tax losses do not expire under current tax legislation. Deferred tax assets have not been recognised in respect of losses for the current period or prior years because it is uncertain if future taxable profit will be available against which the Group can utilise the benefits therefrom. No deferred tax assets are carried forward for prior periods. A table of losses has been maintained should losses be available for use.

25. Reconciliation of cash flows from operating activities

*Note* Loss for the period Finance income Loss from operating activities Adjustments for: Depreciation 11 Amortisation Disposals 11 Impairment 17 Settlement costs 17 Share-based payment transactions 16 Change in other receivables 9 Change in prepayments	35 Consolidated 2010 2009 (9,709,404) (7,408,206) (74,274) (50,235) (9,783,678) (7,458,441) 15,845 6,398 959,624 - - 3,524 - 100,000 - 172,500 583,500 4,551,078 (8,224,709) (2,624,941) 7,610 (2,954) (250,103) 6,519

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Change in trade and other payables 12 Change in employee provision Proceeds for share capital received in advance Settlement cost expensed 17 Net cash from operating activities	1,573,569 424,861 1,558,800 - - (34,000) - 150,000
	(5,334,833) (2,080,515)

26. Earnings per share

Basic earnings per share

The calculation of basic earnings per share at 31 December 2010 was based on the loss attributable to ordinary shareholders of $9,713,588 (2009: $7,408,206) and a weighted average number of ordinary shares outstanding of 661,314,947 (2009: 265,016,780).

27. Capital commitments

On 19 January 2010 the Company completed the acquisition of Jamalcom Pty Ltd trading as CoGen ORC Power (“Jamalcom”). Jamalcom holds the exclusive rights to market the Opcon Powerbox system in Australia, Malaysia, Thailand, Singapore and Sub-Saharan Africa.

Pursuant to the Australian distribution agreement with Opcon Energy System AB there is no minimum commitment to purchase Opcon Powerboxes. At present there is six Opcon Powerboxes on order, with outstanding payments on these of AU$6,400,000. There is no commitment to purchase these Opcon Powerboxes but any progress payments will be fortified.

28. Related parties

Individual directors and executives compensation disclosures

Information regarding individual directors and some equity instruments disclosures as required by Corporations Regulations 2M.3.03 is provided in the remuneration report section of the directors’ report.

Apart from the details disclosed in this note, no director has entered into a material contract with the Company or the Group since the end of the previous financial year and there were no material contracts involving directors’ interests existing at year-end.

Key management personnel compensation:

	Consolidated	Consolidated
	2010	2009
	$	$
Short-term employee benefits	591,744	483,193
Post-employment benefits	34,375	13,863
Long-term benefits	-	-
Termination benefits	430,750	-
Share-based payments	-	3,719,382

Detailed remuneration disclosures are provided in the remuneration report on pages 4 to 8.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Options and rights over equity instruments

The movement during the reporting period in the number of options over ordinary shares in the Company held, directly, indirectly or beneficially, by each key management person, including their related parties, is as follows:

	Held at 1	Granted as		Other		Held at 31
	January 2010	compensation		changes		December
						2010
Directors
Ian Campbell	-	-	-		-	-
Greg Pennefather	1,500,000	-	-		-	1,500,000
Rolf Hasselström	400,000	-	-		-	400,000

All options issued during the reporting period were vested on date of issue.

1 All of the options held by directors at the date of this report were received in their capacity as shareholders of the Company pursuant to the bonus options issue completed on 21 December 2009.

	Held at 1	Granted as	Exercised	Other	Held at 31
	January 2009	compensation		changes	December
					2009
Directors
Ian Campbell	-	-	-	-	-
Greg Pennefather	-	-	-	1,500,000	1,500,000
Ross Smith	-	4,000,000	-	(4,000,000)	-
Guy Le Page	-	4,000,000	(4,000,000)	1,642,934	1,642,934
Rolf Hasselström	-	4,000,000	(4,000,000)	400,000	400,000
Steven Bamford	-	-	-	-	-
Jonathan Asquith	1,028,600	-	-	(1,028,000)	-
Colin Barboutis	168,000	-	-	(168,000)	-

Movements in shares

The movement during the reporting period in the number of ordinary shares in the Company held, directly, indirectly or beneficially, by each key management person, including their related parties, is as follows:

	Held at 1	Granted as	Acquired /	Received	Disposed	Held at 31
	January	compensat	Other	on exercise		December
	2010	ion		of options		2010
Directors
I Campbell	-	-	-	-	-	-
G Pennefather1	15,000,000		41,701,4181	-	2,500,0002	54,201,418
R Hasselström	4,000,000	-	-			4,000,000

1 On 19 January 2010 the Greg Pennefather was issued 41,701,418 shares for the acquisition of Jamalcom Pty Ltd.

2 On 17 March 2010 Greg Pennefather disposed of 2,500,000 shares for nil cash and transferred the shares as settlement of services rendered.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

	Held at 1	Granted as	Acquired	Received	Disposed	Held at 31
	January	compensation		on exercise		December
	2009			of options		2009
Directors
I Campbell	-	-	-	-	-	-
G Pennefather1	-	15,000,000	-	-	-	15,000,000
R Smith	-	15,000,000	-	-	15,000,000	-
G Le Page2	-	-	9,846,008	9,138,888	2,555,555	16,429,341
R Hasselström	-	-	-	4,000,000	-	4,000,000
Steven Bamford	-	-	15,000	-	15,000	-
Jonathan Asquith	702,064	-	-	-	702,064	-
Colin Barboutis	4,272,499	-	170,000	-	4,442,499	-

29. Financial instruments

Credit risk

The carrying amount of the Group’s financial assets represents the maximum credit exposure. The credit risk will result from a decrease in interest rates reducing interest earned. The Group’s maximum exposure to credit risk at the reporting date was:

Note Loans and receivables – current Loans and receivables – non current 9 Cash and cash equivalents 8	Carrying amount 2010 2009 47,585 7,610 5,741,022 1,938,580 484,527 3,523,580
	6,273,134 5,469,770

Liquidity risk

The Group has limited exposure to liquidity risk as the Group’s main liabilities are trade and other payables. All financial liabilities have contractual maturities of less than 6 months.

On 17 December 2010, shareholders approved a bond facility totalling $25,000,000. This facility will be used to fund Opcon Powerbox payments and replace working capital previously used for Opcon Powerbox payments. This facility underpins Enerji and provide the necessary liquidity to achieve the company’s short to medium term goals.

Currency risk

The Group, at this point in time, doesn’t hedge it’s estimated foreign currency exposure in respect of forecast sales and purchases. The Group also, at this point in time, doesn’t hedge it’s trade receivables and trade payables denominated in a foreign currency.

Due to the anticipated increase in future foreign currency transactions, management has engaged Travelex to provide advice and solutions for the management of the Company’s currency exposure. This in turn will be rolled into a policy for management of foreign exchange risk, with completion of the policy within the first half of 2011.

Interest rate risk

The Group exposure to interest rates relate primarily to cash and cash equivalents. As at the date of these accounts the Group has no financial liabilities subject to interest rate movements. The maximum exposure to credit risk at the end of the reporting period is the carrying amount of each class of cash and cash equivalents mentioned above. Sensitivity to interest rate risk is considered immaterial.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

Market risk

The group and the parent entity operate internationally and are exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the SEK (swedish krona).

Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the entity’s functional currency. The risk is measured using sensitivity analysis and cash flow forecasting.

Management has set up a policy that all transactions in foreign currencies be transacted at spot. Management will continually review this policy based on volumes of foreign currency required.

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

Trade payables Forward exchange contracts - buy foreign currency (cash flow hedges) - sell foreign currency (cash flow hedges)	2010 2009 SEK $ SEK $ 1,787,240 -
	- - - -

The carrying amounts of the parent entity’s financial assets and liabilities are denominated in Australian dollars except as set out below:

Receivables Borrowings Forward exchange contracts - buy foreign currency (cash flow hedges) - sell foreign currency (cash flow hedges)	2010 2009 SEK $ SEK $ - - - -
	- - - -

Fair values

The fair values of financial assets and liabilities as at the reporting date are considered to be the same as the carrying amounts shown in the statement of financial position.

Capital management

The Board’s policy is to maintain a strong asset base so as to maintain investor, creditor and market confidence and to sustain future development of the business. There were no changes in the Group’s approach to capital management during the year. Neither the Company nor any of its subsidiaries are subject to externally imposed capital requirements.

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

30. Parent Entity disclosures

(a) Financial position

ASSETS Current Assets Cash and cash equivalents Other receivables and prepayments Total current assets Other receivables Inter-company loan Property, plant and equipment Investments Total non-current assets Total assets Liabilities Trade and other payables Other Liabilities Total current liabilities Total liabilities Net assets Equity Issued capital Reserves Accumulated losses Total equity (b) Financial performance Loss for the period Other comprehensive income Total comprehensive loss	Consolidated 2010 2009 480,342 3,518,918 47,585 7,610
	527,927 3,526,528
	- 1,938,580 4,259,676 101 102,717 107,824 5,000,000 -
	9,362,393 2,046,505

	9,890,320 5,573,033
	254,193 467,863 58,800 -
	312,993 467,863

	312,993 467,863

	9,577,327 5,105,170
	47,760,408 36,262,679 5,015,238 4,931,738 (43,198,319) (36,089,247)
	9,577,327 5,105,170
	7,109,072 7,408,206 - -
	7,109,072 7,408,206

Enerji Limited

Notes to the financial statements

For the year ended 31 December 2010

31. Subsequent event

On 2[nd] February, the company competed the first drawdown under the Bond Facility Agreement, as approved by shareholders on 17 December 2010.

32. Auditors’ remuneration

2. Auditors’ remuneration
Current year BDO Audit (WA) Pty Ltd: Audit of year end 2010 financial reports KPMG Australia: Audit and review of year end 2009 financial reports Review of half yearly 2010 financial reports Other auditors: Audit and review of financial reports	Consolidated 2010 2009 22,000 - 80,700 55,000 30,000 32,156 - 2,772
	132,700 89,928

DECLARATION OF BY DIRECTORS

The directors of the company declare that:

The financial statements, comprising the statement of comprehensive income, statement of financial position, statement of cash flows, statement of changes in equity, accompanying notes, are in accordance with the Corporations Act 2001 and:
(a) comply with Accounting Standards and the Corporations Regulations 2001; and
(b) give a true and fair view of the consolidated entity’s financial position as at 31 December 2010 and of its performance for the year ended on that date.
The company has included in the notes to the financial statements an explicit and unreserved statement of compliance with International Financial Reporting Standards.
In the directors’ opinion, there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.
The directors have been given the declarations by the chief executive officer and chief financial officer required by section 295A.

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

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Greg Pennefather Director

Perth, WA

31 March 2011

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

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

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INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ENERJI LIMITED

Report on the Financial Report

We have audited the accompanying financial report of Enerji Limited, which comprises the consolidated statements of financial position as at 31 December 2010, the consolidated statements of comprehensive income, the consolidated statements of changes in equity and the consolidated statements 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 and the consolidated entity comprising the company and the entities it controlled at the year’s end or from time to time during the financial year.

Directors’ Responsibility for the Financial Report

The directors of the company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that is free from material misstatement, whether due to fraud or error. In Note 2, the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements , that the financial statements comply with International Financial Reporting Standards.

Auditor’s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’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 entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report.

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 . We confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of Enerji Limited, would be in the same terms if given to the directors as at the time of this auditor’s report.

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation (other than for the acts or omissions of financial services licensees) in each State or Territory other than Tasmania.

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Opinion

In our opinion:

(a) the financial report of Enerji Limited is in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the consolidated entity’s financial positions as at 31 December 2010 and of their performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001 .
(b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 2.

Report on the Remuneration Report

We have audited the Remuneration Report included in pages 4 to 8 of the directors’ report for the year ended 31 December 2010. 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.

Opinion

In our opinion, the Remuneration Report of Enerji Limited for the year ended 31 December 2010 complies with section 300A of the Corporations Act 2001 .

BDO Audit (WA) Pty Ltd

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Brad McVeigh Director

Perth, Western Australia Dated on this 31[st] day of March 2011

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

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

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31 March 2010

Enerji Limited The Board of Directors Level 22, Allendale Square 77 St George’s Terrace Perth WA 6000

Dear Sirs,

DECLARATION OF INDEPENDENCE BY BRAD McVEIGH TO THE DIRECTORS OF ENERJI LIMITED

As lead auditor of Enerji Limited for the year ended 31 December 2010, I declare that, to the best of my knowledge and belief, there have been no contraventions of:

the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
any applicable code of professional conduct in relation to the audit.

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

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Brad McVeigh Director

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BDO Audit (WA) Pty Ltd Perth, Western Australia

Enerji Limited

ASX additional information as at 30 March 2011

Corporate Governance Statement

This statement outlines the main corporate governance practices in place throughout the financial year, which comply with the ASX Corporate Governance Council recommendations, unless otherwise stated.

As the framework of how the Board of Directors at Enerji Limited (“Company”) carries out its duties and obligations, the Board has considered the eight principles of corporate governance as set out in the ASX Corporate Governance Principles and Recommendations.

Principle 1 – Lay solid foundations for management and oversight

Companies should establish and disclose the respective roles and responsibilities of Board and management.

Recommendation 1.1: Companies should establish the functions reserved to the Board and those delegated to senior executives and disclose those functions.

The Directors monitor the business affairs of the Company on behalf of Shareholders and have formally adopted a corporate governance policy which is designed to encourage Directors to focus their attention on accountability, risk management and ethical conduct.

The Company’s main corporate governance policies and practices are outlined below:

The Board of Directors

The Company’s Board of Directors is responsible for corporate governance of the Company. The Board develops strategies for the Company, reviews strategic objectives and monitors performance against those objectives.

The goals of the corporate governance processes are to:

(a) maintain and increase Shareholder value;
(b) ensure a prudential and ethical basis for the Company’s conduct and activities; and
(c) ensure compliance with the Company’s legal and regulatory objectives.

Consistent with these goals, the Board assumes the following responsibilities:

(a) developing initiatives for profit and asset growth;
(b) reviewing the corporate, commercial and financial performance of the Company on a regular basis;
(c) acting on behalf of, and being accountable to, the Shareholders; and
(d) identifying business risks and implementing actions to manage those risks and corporate systems to assure quality.

The Company is committed to the circulation of relevant materials to Directors in a timely manner to facilitate Directors’ participation in the Board discussions on a fully-informed basis.

Composition of the Board

Election of Board members is substantially the province of the Shareholders in general meeting. However, subject thereto, the Company is committed to the following principles:

(a) the Board is to comprise Directors with a blend of skills, experience and attributes appropriate for the Company and its business; and
(b) the principal criterion for the appointment of new Directors is their ability to add value to the Company and its business.

No formal nomination committee or procedures have been adopted for the identification, appointment and review of the Board membership, but an informal assessment process, facilitated by the Chairman in consultation with the Company’s professional advisors, has been committed to by the Board.

Enerji Limited

Corporate Governance Statement

Independent professional advice

The Directors may obtain independent professional advice on issues arising in the course of their duties.

Remuneration arrangements

The remuneration of an Executive Director will be decided by the Board, without the affected Executive Director participating in that decision-making process.

The total cash remuneration of Non-Executive Directors is the subject of a Shareholder resolution in accordance with the Company’s Constitution, the Corporations Act and the ASX Listing Rules, as applicable. The determination of Non-Executive Directors’ remuneration within that maximum will be made by the Board having regard to the inputs and value to the Company of the respective contributions by each Non-Executive Director. The current limit, which may only be varied by Shareholders in general meeting, is an aggregate cash amount of $400,000 per annum.

The Board may award additional remuneration to Non-Executive Directors called upon to perform extra services or make special exertions on behalf of the Company.

External audit

The Company in general meetings is responsible for the appointment of the external auditors of the Company, and the Board from time to time will review the scope, performance and fees of those external auditors.

Audit committee

The Company has established a separate constituted audit committee.

Identification and management of risk

The Board’s collective experience will enable accurate identification of the principal risks that may affect the Company’s business. Key operational risks and their management will be recurring items for deliberation at Board meetings.

Ethical standards

The Board is committed to the establishment and maintenance of appropriate ethical standards.

Recommendation 1.2: Companies should disclose the process for evaluating the performance of senior executives.

The Remuneration Committee reviews the remuneration policies applicable to all Directors and Executive Officers on an as needed basis and makes recommendations on remuneration packages and terms of employment to the Board. Remuneration packages, which consist of base salary, fringe benefits, incentive schemes (including performance related bonuses), superannuation, and entitlements upon retirement or termination, are reviewed with due regard to performance and other relevant factors.

Principle 2 – Structure the Board to add value

Companies should have a Board of an effective composition, size and commitment to adequately discharge its responsibilities and duties.

Recommendation 2.1: A majority of the Board should be independent directors.

The Board has six Directors comprising one managing executive directors and five independent non executive directors.

Recommendation 2.2: The chair should be an independent director.

The chairman is independent.

Recommendation 2.3: The roles of the chair and Chief Executive Officer should not be exercised by the same individual.

The roles of chief executive officer and chairman are not held by the same person.

Recommendation 2.4: The Board should establish a nomination committee.

Enerji Limited

Corporate Governance Statement

The Board has not established a nomination committee. The Board, as a whole, deals with areas that would normally fall within the Charge of the Nomination Committee. These include matters relating to the renewal of Board Members and Board Performance.

Recommendation 2.5: Companies should disclose the process for evaluating the performance of the Board, its committees and individual directors.

The Remuneration Committee has developed a formal process for performance evaluation of the Board. The Remuneration Committee reviews the remuneration policies applicable to all Directors and Executive Officers on an as needed basis and makes recommendations on remuneration packages and terms of employment to the Board. Remuneration packages, which consist of base salary, fringe benefits, incentive schemes (including performance related bonuses), superannuation, and entitlements upon retirement or termination, are reviewed with due regard to performance and other relevant factors.

Principle 3 – Promote ethical and responsible decision-making

Companies should actively promote ethical and responsible decision-making.

Recommendation 3.1: Companies should establish a code of conduct and disclose the code or a summary of the code as to:

The practices necessary to maintain confidence in the company’s integrity
The practices necessary to take into account their legal obligations and the reasonable expectations of their stakeholders
The responsibility and accountability of individuals for reporting and investigating reports of unethical practices

The Company is committed to Directors and employees maintaining high standards of integrity and ensuring that activities are in compliance with the letter and spirit of both the law and Company policies.

Directors acquaint themselves with obligations imposed on them and the Company by the Corporations Act. They will also familiarise themselves with other documents prepared by the Company to meet corporate governance requirements:

the Employee Code of Conduct –sets out minimum standards of conduct and integrity to be observed by all employees and Directors;
the Corporate Governance Statement –advises Shareholders and ASX of the corporate governance practices put in place by the Board.

Recommendation 3.2: Companies should establish a policy concerning trading in company securities by directors, senior executives and employees, and disclose the policy or a summary of that policy.

The Policy on Directors and Senior Executives dealing in Securities objective is to:

minimise the risk of Directors and Senior Executives of the Company contravening the laws against insider trading;
ensure the Company is able to meet its reporting obligations under the ASX Listing Rules; and
increase transparency with respect to trading in securities of the Company by Directors and Senior Executives.

The Chairman will generally not allow Directors and Senior Executives to deal in securities of the Company as a matter of course in the following periods:

from the date any draft or preliminary information is made available to, or a person becomes aware of, relating to annual, half yearly or quarterly results;
within the month prior to the release of annual, quarterly or half yearly results;
within the month prior to the issue of a prospectus; and
where price sensitive information has not been disclosed because of an ASX Listing Rule exception.

Enerji Limited

Corporate Governance Statement

Directors and Senior Executives should wait at least 3 business days after the release of the relevant information before dealing in securities so that the market has had time to absorb the information.

In specific circumstances however, such as financial hardship, the Chairman may waive the prohibition on a Director or Senior Executive dealing in securities at any of the above times on the condition that the Director or Senior Executive can demonstrate to him that they are not in possession of any price sensitive information that is not generally available to the public.

Principle 4 – Safeguard integrity in financial reporting

Companies should have a structure to independently verify and safeguard the integrity of their financial reporting.

Recommendation 4.1: The Board should establish an audit committee.

The board has established an Audit Committee consisting of Ian Campbell, Greg Pennefather (Chairperson), Rolf Hasselström.

Recommendation 4.2: The audit committee should be structured so that it:

consists of only non-executive directors
consists of a majority of independent directors
is chaired by an independent chair, who is not chair of the Board
has at least three members.

The Company’s current Audit Committee only consists of 3 board members with a majority of independent directors. The Chairperson is an independent chair.

Recommendation 4.3: The audit committee should have a formal charter.

Such a charter is not considered necessary for the proper function of the committee given the composition of the Audit Committee and the Board.

Principle 5 – Make timely and balanced disclosure

Companies should promote timely and balanced disclosure of all material matters concerning the company.

Recommendation 5.1: Companies should establish written policies designed to ensure compliance with ASX Listing Rule disclosure requirements and to ensure accountability at a senior executive level for that compliance and disclose those policies or a summary of those policies.

The Company has obligations under the Corporations Act and ASX Listing Rules to keep the market fully informed of information which may have a material effect on the price or value of its securities. The Company discharges these obligations by releasing information to ASX in the form of an ASX release or disclosure in other relevant documents (e.g. the Annual Report).

The Company has a continuous disclosure program in place designed to ensure the compliance with ASX Listing Rule disclosure and to ensure accountability at a senior executive level for compliance and factual presentation of the Company’s financial position.

Principle 6 – Respect the rights of shareholders

Companies should respect the rights of shareholders and facilitate the effective exercise of those rights.

Recommendation 6.1: Companies should design a communications policy for promoting effective communication with shareholders and encouraging their participation at general meetings and disclose their policy or a summary of that policy.

The Company is committed to the promotion of investor confidence by ensuring that trade in its securities takes place in an efficient, competitive and informed market. The Board Charter recognises the importance of forthright communication as a key plank in building shareholder value and that to prosper and achieve growth the Company must (among other things) earn the trust of employees, customers, suppliers, communities and security holders by being forthright in its communications and consistent in its fulfilment of obligations.

Principle 7 – Recognise and manage risk

Enerji Limited

Corporate Governance Statement

Companies should establish a sound system of risk oversight and management and internal control.

Recommendation 7.1: Companies should establish policies for the oversight and management of material business risks and disclose a summary of those policies.

Management determines the Company’s risk profile and is responsible for overseeing and approving risk management strategy and policies, internal compliance and internal control. The Company’s process of risk management and internal compliance and control includes:

establishing the Company’s goals and objectives, and implementing and monitoring strategies and policies to achieve these goals and objectives;
continuously identifying and reacting to risks that might impact upon the achievement of the Company’s goals and objectives, and monitoring the environment for emerging factors and trends that affect these risks;
formulating risk management strategies to manage identified risks and designing and implementing appropriate risk management policies and internal controls; and
monitoring the performance of, and continuously improving the effectiveness of, risk management systems and internal compliance and controls, including an ongoing assessment of the effectiveness of risk management and internal compliance and control.

Recommendation 7.2: The Board should require management to design and implement the risk management and internal control system to manage the company’s material business risks and report to it on whether those risks are being managed effectively. The Board should disclose that management has reported to it as to the effectiveness of the Company’s management of its material business risks.

The responsibility for undertaking and assessing risk management and internal control effectiveness is delegated to management. Management is required by the Board to report back on the efficiency and effectiveness of risk management, inter alia, by benchmarking the Company’s performance against industry standards.

The risk profile of the Company contains both financial and non-financial factors including material risks arising from pricing, competitive position, currency movements, operational efficiency, product quality, investments in new projects.

To mitigate these risks, the company has in place an experienced Board, regular Board meetings, financial annual audit and half year review, rigorous appraisal of new investments, and advisers familiar with the company. The Board’s collective experience will enable accurate identification of the principal risks that may affect the Company’s business. Key operational risks and their management will be recurring items for deliberation at Board Meetings.

Recommendation 7.3: The Board should disclose whether it has received assurance from the chief executive officer (or equivalent) that the declaration provided in accordance with section 295A of the Corporations Act is founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to financial reporting risks.

The Chief Executive Officer and the Financial Controller confirm in writing to the Board that the financial reports of the Company for the financial year:

present a true and fair view, in all material respects, of the company’s financial condition and operational results and are in accordance with relevant accounting standards;
the statement given in paragraph (a) above is founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the Board; and
the company’s risk management and internal compliance and control system is operating efficiently and effectively in all material respects.

Principle 8 – Remunerate fairly and responsibly

Companies should ensure that the level and composition of remuneration is sufficient and reasonable and that its relationship to performance is clear.

Enerji Limited

Corporate Governance Statement

Recommendation 8.1: The Board should establish a remuneration committee.

The Board has established a remuneration committee. The Committee consists of Ian Campbell (Chairperson), and Rolf Hasselström.

Recommendation 8.2: Companies should clearly distinguish the structure of non-executive directors’ remuneration from that of executive directors and senior executives.

Executive Directors remuneration packages may comprise of:

(a) salary and associated superannuation;
(b) fixed directors fees; and
(c) performance based bonuses.

Non-Executive Directors receive fixed directors fees only, and do not participate in any performance-based remuneration. Fixed directors fees may be paid in the form of cash, shares, share options or a combination of both. Shares and share options are issued on similar terms to previous issues by the entity and are considered to be in lieu of cash, not based on performance of the entity.

Full remuneration disclosure, including superannuation entitlements, and the number of meetings of the Remuneration Committee is provided by the Company in its annual report. The Remuneration Committee ensures that all equity based executive remuneration is made within the guidelines set by plans approved by Shareholders.

Departure from Best Practice Recommendations

From 1 January 2009 to 31 December 2009, the Company complied with each of the Eight Essential Corporate Governance Principles and Best Practice Recommendations published by the ASX Corporate Governance Council, other than in relation to the table below.

	Notification of
Recommendation	Departure	Explanation from Departure
2.4	The Board has not	The whole Board carries out the duties which would otherwise
	established a	be undertaken by the nomination committee. The need for a
	nomination committee.	nomination committee will be reviewed annually.
4.3	The audit committee	Such a charter is not considered necessary for the proper
	should have a formal	function of the committee as the whole Board carried out the
	charter.	duties which would otherwise be undertaken by the audit
		committee during the reporting period.

The Enerji Limited Corporate Governance Principles & Practices Manual is available on the Company’s website www.enerji.com.au

Enerji Limited

ASX additional information as at 30 March 2011

Additional information required by the ASX Limited Listing Rules and not disclosed elsewhere in this report is set out below.

Securities Exchange

The Company is listed on the Australian Securities Exchange. The Home exchange is Perth.

Other information

Enerji Limited, incorporated and domiciled in Australia, is a publicly listed company limited by shares.

ORDINARY SHARES

Twenty largest shareholders

Name
Hawera Pty Ltd
Boxpower AB
Mr Greg Pennefather
Gabrielsson Invest AB
HSBC Custody Nominees (Austrlia) Limited
Frollo Enterprises Limited
E C Dawson Super Pty Ltd
Jamalexal Pty Ltd
Buelow Nominees Pty Ltd
Jonathan Keng Hock Lim
Westedge Investments Pty Ltd
Bell Potter Nominees Ltd
Dawesville Nominees Pty Ltd
Invictus Capital Pty Ltd Main Family
J & TW Dekker Pty Ltd
Bludgeon Pty Ltd
Mr Graham Geoffrey Walker and Mrs Thelma Jean Walker Super Fund A/C>
Mr Peter Wassell
Australian Heritage Group Pty Ltd Australian Heritage
Mr Petri Tuominen
Mr Rolf Hasselstrom
Ms Katherine Price

Number of ordinary
shares held
Percentage of
capital held
64,390,147
10.0%
44,500,000
6.9%
41,701,418
6.5%
25,981,482
4.0%
25,911,105
4.0%
20,000,000
3.1%
15,700,000
2.4%
12,500,000
2.0%
11,000,000
1.7%
9,062,146
1.4%
8,000,000
1.2%
7,499,000
1.2%
6,500,000
1.0%
6,493,396
1.0%
6,300,000
1.0%
5,500,000
0.9%
5,000,000
0.8%
5,000,000
0.8%
4,600,000
0.7%
4,121,920
0.6%
4,000,000
0.6%
4,000,000
0.6%

337,760,614
52.6%

Substantial shareholders

The number of shares held by substantial shareholders and option holders and their associates are set out below:

Shareholder Hawera Pty Ltd Boxpower AB Mr Greg Pennefather Distribution of equity security holders 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,000 - 100,000 100,000 and over	Number 64,390,147 44,500,000 41,701,418 Holders 229 142 119 696 528
	1,714

The number of shareholders holding less than a marketable parcel of ordinary shares is 439.

Enerji Limited

ASX additional information as at 30 March 2011

Voting rights

On a show of hands every person present who is a member or a proxy, attorney or representative of a member has one vote and upon a poll every person present who is a member or a proxy, attorney or representative of a member shall have one vote for each share held.

OPTIONS

Twenty largest option holders

Name
Hawera Pty Ltd
Opcon Energy Systems AB
Gabrielsson Invest AB
Zero Nominees Pty Ltd
Equity Trustees Limited
Frollo Enterprises Limited
Amarilo Investments Pty Ltd
Dark Dragon Holdings Pty Ltd
Jamalexal Pty Ltd
Westedge Investments Pty Ltd
Mr Noel David McEvoy & Mrs Shelley Dawn McEvoy McEvoy Super Fund A/C>
Mr John Lagana
Australian Heritage Group Pty Ltd
Tarney Holdings Pty Ltd
Mr Philip Alexander Karl Hoefer
Dawesville Nominees Pty Ltd
EC Dawson Super Pty Ltd
Mr Peter Wallis King & Mrs Tania Kitty King
Jemaya Pty Ltd
Invictus Capital Pty Ltd

Buelow Nominees Pty Ltd
Beanthere2 Pty Ltd
Thornbush Corporation Limited
Bludgeon Pty Ltd
Mr Gregory John Gibson
Substantial option holders
Hawera Pty Ltd
Opcon Energy Systems AB
Gabrielsson Invest AB
Zero Nominees Pty Ltd
Distribution of equity security holders
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,000 - 100,000

Number of options
held
Percentage of
total held
6,439,015
9.9%
4,450,000
6.9%
4,450,000
6.9%
3,867,440
6.0%
2,017,750
3.1%
2,000,000
3.1%
1,701,000
2.6%
1,700,000
2.6%
1,500,000
2.3%
1,427,000
2.2%
1,406,973
2.2%
1,300,000
2.0%
1,000,000
1.5%
889,505
1.4%
830,146
1.3%
650,000
1.0%
645,000
1.0%
583,572
0.9%
517,595
0.8%
500,000
0.8%
500,000
0.8%
500,000
0.8%
500,000
0.8%
500,000
0.8%
492,500
0.8%

40,367,496
62.4%

Number
6,439,015
4,450,000
4,450,000
3,867,440
Holders
534
395
203
277

Enerji Limited

ASX additional information as at 30 March 2011

100,000 and over	89
	1,498

Voting rights

There are no voting rights attached to the options.

AI assistant

VOLT GROUP LIMITED — Annual Report 2010

66016_rns_2011-03-31_606e73ef-1224-4f65-9d95-c616a6de889d.pdf

Enerji Limited

Corporate Directory

DIRECTORS

COMPANY SECRETARY

REGISTERED OFFICE

PRINCIPAL PLACE OF BUSINESS

SHARE REGISTER

SOLICITORS

AUDITORS

BANKERS

INTERNET ADDRESS

Table of Contents

Enerji Limited

Directors’ report

1. Directors

The Hon Ian Campbell

Mr Greg Pennefather

Mr Rolf Hasselström

Directors’ report

For the year ended 31 December 2010

Ms Samantha Tough

2. Company Secretary

Mr Geoffrey Reid

Mr Greg MacMillan

3. Principal activities

4. Operating and financial review

Operating Review

Review of consolidated financial condition

Directors’ report

For the year ended 31 December 2010

Corporate Structure

Capital Structure

5. Significant changes in the state of affairs

6. Dividends

7. Events subsequent to reporting date

8. Likely developments

Directors’ report

For the year ended 31 December 2010

9. Share options

Shares issued on exercise of options

10. Remuneration report - Audited

Directors’ report

For the year ended 31 December 2010

Directors’ report

For the year ended 31 December 2010

Directors’ report

For the year ended 31 December 2010

Directors’ report

For the year ended 31 December 2010

Service agreements

11. Directors’ interests

Directors’ report

For the year ended 31 December 2010

12. Directors’ meetings

13. Indemnification and insurance of officers and auditors Indemnification

14. Environmental regulation and performance

Directors’ report

For the year ended 31 December 2010

15. Proceedings on behalf of the Company

16. Corporate governance statement

17. Lead auditor’s independence declaration

18. Auditors’ remuneration

Statement of financial position

As at 31 December 2010

Enerji Limited

Statement of comprehensive income

For the year ended 31 December 2010

Enerji Limited

Statement of changes in equity

Statement of cash flows

For the year ended 31 December 2010

Enerji Limited

Notes to the financial statements

1. Reporting entity

2. Basis of preparation

(a) Statement of compliance

(b) Basis of measurement

VOLT GROUP LIMITED Annual Report 2010