Annual Report 2021
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ABN 52 118 913 232
and its controlled entities
ANNUAL REPORT
30 June 2021
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Corporate directory
Current Directors
Andrew Jensen Executive Chairman and Chief Operating Officer
Paul Niardone Managing Director
Matthew LaHood Executive Director
Adam Davey Non-executive Director
Company Secretary
Stuart Usher
Registered Office and Head Office Share Registry
Street: 68 Milligan Street Advanced Share Registry Limited
PERTH WA 6000 Street + Postal: 110 Stirling Highway
Postal: PO Box 7768 NEDLANDS WA 6009
CLOISTERS SQUARE WA 6850 Telephone: 1300 113 258 (within Australia)
Telephone: +61 (0)8 9204 7955 +61 (0)8 9389 8033 (International)
Facsimile: +61 (0)8 9204 7956 Facsimile: +61 (0)8 6370 4203
Email: info@theagencygroup.com.au Email: admin@advancedshare.com.au
Website: theagencygroup.com.au Website: www.advancedshare.com.au
Auditors Securities Exchange
Hall Chadwick WA Audit Pty Ltd Australian Securities Exchange
(formerly known as Bentleys Audit & Corporate (WA) Pty Ltd) Level 40, Central Park, 152-158 St Georges Terrace
283 Rokeby Road Perth WA 6000
SUBIACO WA 6008 Telephone: 131 ASX (131 279) (within Australia)
Telephone: +61 (0)8 9426 0666 Telephone: +61 (0)2 9338 0000
Facsimile: +61 (0)2 9227 0885
Solicitors Website: www.asx.com.au
Steinepreis Paganin ASX Code AU1
Level 4, The Read Buildings
16 Milligan Street
Perth WA 6000
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Contents
◼ Chairman’s letter......................................................................................................................................................................... 1
◼ Managing Director’s letter .......................................................................................................................................................... 2
◼ Directors' report .......................................................................................................................................................................... 3
◼ Remuneration report ................................................................................................................................................................ 11
◼ Auditor's independence declaration ......................................................................................................................................... 22
◼ Consolidated statement of profit or loss and other comprehensive income............................................................................ 23
◼ Consolidated statement of financial position .......................................................................................................................... 24
◼ Consolidated statement of changes in equity ........................................................................................................................... 25
◼ Consolidated statement of cash flows ...................................................................................................................................... 26
◼ Notes to the consolidated financial statements ....................................................................................................................... 27
◼ Directors' declaration ................................................................................................................................................................ 74
◼ Independent auditor's report.................................................................................................................................................... 75
◼ Corporate governance statement ............................................................................................................................................. 81
◼ Additional Information for Listed Public Companies ................................................................................................................. 82
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Chairman’s letter
From the Chair New Shareholders
The Agency’s strong business model was further
validated with the backing of new major
shareholder private investment company Peters
Investments which currently has a 30.2% stake
in the Company after converting $3 million in
Convertible Notes.
Key Appointments
In addition, The Agency’s board and
management team - already one of the most
highly regarded executive teams in the
Australian property industry - was further
bolstered with the appointment of highly
experienced industry executive Geoff Lucas as
new Group CEO. In only six short months since
I n many respects FY2021 was a company- his appointment, Mr Lucas has become intrinsic
making year for The Agency Group in which to the Company and his value cannot be
we delivered strong operating and financial overstated.
results despite the COVID-19 pandemic and Outlook
ongoing restrictions in key real estate markets.
While COVID-19 restrictions continue to impact
Financial results key markets into FY2022, we are confident the
The Company significantly strengthened its national property market will remain resilient
balance sheet on the back of a long-term ~$8 and that we are in strong position for further
million funding package while posting record growth in FY2022 and beyond.
Earnings Before Interest Tax Depreciation Acknowledgments
Amortisation (EBITDA) of $4.6 million1, annual
I would like to take this opportunity to thank
Group Revenue of $58.4 million and growth
our shareholders, board, staff and property
across all key metrics.
partners for their strong commitment to our
The Agency reduced its debt position to $8.35 business over what has been a rewarding but
million (FY20: $12.2 million) and continues to challenging 12-months.
receive the commitment and support of
Thank you for your continuing loyalty and we
primary lender Macquarie Bank. This ongoing
look forward to what promises to be another
support was evidenced by Macquarie Bank
significant year for the company.
agreeing to an interest rate reduction in
recognition of the significant improvements to
balance sheet and continued strong operational
performance.
1 EBITDA is unaudited and provided on a pre-adoption of
AASB16 (but includes government incentives)
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Managing Director’s letter
From the Managing Director We have also pleasingly witnessed operating
costs as a percentage of revenue reducing over
the past three years to 32% of revenue in FY21,
a reduction from 42% of revenue in FY20 and
65% of revenue in FY19.
Recruitment
Our unique model has and always will continue
to attract the best talent and I am extremely
proud of our team who continue to negotiate
the best results for clients amid uncertain
conditions. We remain confident organic
growth will continue to drive revenue growth.
The ongoing recruitment of highly-experienced
agents remains a core focus of our business. As
at 30th June 2021, the Company had 308
agents, up from 283 agents at 30th June 2020,
W hile throwing up its fair share of
challenges, FY2021 was ultimately
a highly rewarding year for The
Agency Group thanks to the stellar efforts of
with average GCI by agent increasing by +57%
over FY20. Based on the Company’s existing
platform and cost structure, which is largely
fixed, any future recruitment and productivity
our highly experienced, award-winning agents gains will contribute to EBITDA performance.
and staff.
Outlook
Achievements Looking ahead, we are well positioned with a
I am very proud of our achievements in the past strong pipeline of listings into FY2022 on the
12-month period, a year in which our disruptive back of a positive property market. All signs are
business model continued to be validated by the national property market will continue to
our operational and financial results while perform strongly as lockdowns are eventually
weathering COVID-19 challenges in key wound back in impacted states.
markets.
For The Agency, we will continue to drive
Operationally, we continue to hit all-time highs growth via quality recruitment while
across all key metrics with Gross Commission maintaining a sustainable financial framework
Income up 69% year-on-year, listings up 30% and continuing to identify and implement
year-on-year and gross value of sales up 65% efficiencies into our business.
year-on-year, further reinforcing our sustained
growth since inception. Acknowledgements
On behalf of the Board and Management Team,
In a further sign of the effectiveness of our I would like to sincerely thank our agents and
business, The Agency outperformed the staff for their hard work, dedication and
broader market with a 57.7% increase in our commitment to our business. To our
transaction numbers, significantly above the shareholders, I thank you for your unwavering
40.7% experienced across the Australian real support and look forward to an exciting FY22
estate market for the year to July 2022. for The Agency Group.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Directors' report
Your Directors present their report on the Group, consisting of The Agency Group Australia Ltd (The Agency or the Company)
and its controlled entities (collectively the Group), for the financial year ended 30 June 2021.
The Agency is listed on the Australian Securities Exchange (ASX:AU1).
1. Directors
The names of Directors in office at any time during or since the end of the year are:
◼ Andrew Jensen Executive Chairman and Chief Operating Officer
◼ Paul Niardone Managing Director
◼ Matthew LaHood Executive Director
◼ Adam Davey Non-Executive Director
(collectively the Directors or the Board)
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated. For additional
information of Directors including details of the qualifications of Directors, please refer to paragraph 6 of this Directors Report.
2. Company secretary
The following person held the position of Company Secretary at the end of the financial year:
◼ Stuart Usher
Qualifications B.Bus, CPA, Grad Dip CSP, MBA, AGIA, ACIS
Experience Mr Usher is a CPA and Chartered Company Secretary with 25 years of extensive
experience in the management and corporate affairs of public listed companies. He holds
an MBA from the University of Western Australia and has extensive experience across
many industries focusing on Corporate & Financial Management, Strategy & Planning,
Mergers & Acquisitions, and Investor Relations & Corporate Governance.
3. Dividends paid or recommended
There were no dividends paid or recommended during the financial year ended 30 June 2021.
4. Significant Changes in the state of affairs
There have been no significant changes in the state of affairs of the Group during the financial year ended 30 June 2021 other
than disclosed elsewhere in this Annual Report.
5. Operating and financial review
5.1. Nature of Operations Principal Activities
The principal activity of the Group for the financial year was real estate services and related activities. There were no
significant changes in the nature of the Group’s principal activities during the financial year.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
5.2. Operations Review
a. Key Metrics
ANNUAL GROUP REVENUE ($M) GCI ($M)
70 90
Up 68% Y-o-Y
Up 39% Y-o-Y 80
60
70
50
60
40 50
80.7
30 58.38 40
41.86 30 47.9
20
28.3 20 37.9
10 28.8
9.6 16.8 10 3.8
0 0
FY17 FY18 FY19 FY20 FY21 FY17 FY18 FY19 FY20 FY21
NUMBER OF EXCHANGES (#) VALUE OF EXCHANGES ($B)
Up 58% Y-o-Y Up 66% Y-o-Y
6000 6
4,964 4.8
5000 5
4000 4
3,147 2.9
3000 2,409 3 2.4
1,540 1.8
2000 2
1000 667 1
0.2
0 0
FY17 FY18 FY19 FY20 FY21 FY17 FY18 FY19 FY20 FY21
NUMBER OF NEW LISTINGS (#)
Up 30% Y-o-Y
6,000
5,137
5,000
3,957
4,000 3,430
3,000
1,776
2,000
1,000 639
-
FY17 FY18 FY19 FY20 FY21
The Agency delivered strong operating results for FY2021 with all key metrics increasing during the year across our
businesses as demonstrated above. The results further reinforce the sustained growth the business has been able to
achieve year on year for the past three years. This is despite the ongoing impact of the COVID-19 pandemic and resultant
restrictions on the real estate sector nationally during the reporting period.
For FY2021, the Group reported Annual Group Revenue of $58.38 million, a 39.46% increase year-on-year (FY2020: $41.86
million), which further highlights the effectiveness of the Company’s model.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Directors' report
The increase in revenue was primarily due to a 68% increase year-on-year in Combined Gross Commission Income to
$80.7 million (FY2020: $47.9 million). This figure was bolstered by 4,964 sales (up from 3,147 sales for FY2020) and
$4.8 billion worth of property sold across the combined group for FY2021 (FY2020: $2.9 billion). Pleasingly, the 57.7% year-
on-year increase in The Agency’s transaction numbers was considerably more than the 40.7% market growth for the same
period.
Property management has 3,517 Properties Under Management as at 30 June 2021, this is 27% down on prior year due to
the disposal of the WA rent roll in September 2020. This rent roll generates $7 million revenue annually.
The Company also witnessed growth in its Mortgage Solutions Australia (MSA) business with home loan approvals for
FY2021 up 24% year-on-year from $137.4 million to $170.6 million.
As at 30 June 2021, The Agency was comprised of a combined 308 sales agents (East Coast: 163, West Coast: 145), with
average Gross Commission Income (GCI) by agent increasing by over 57% over the past twelve months. The Agency’s model
of allowing our high-quality agents to focus on sales and providing support is being demonstrated by the year-on-year
increase in GCI.
The Agency will be looking to boost agent numbers in the coming quarters. Based on the company’s existing platform and
cost structure, which is largely fixed, any future recruitment will directly contribute to EBITDA performance.
The Agency Group reported cash receipts of $71.57 million for the FY2021, a 68.29% year-on-year increase (FY2020: $42.53
million).
Please see below table highlighting year-on-year growth across key metrics:
FY2021 FY2020 % Change
Revenue ($M) 58.38 41.86 +39%
EBITDA ($M) 6.37 2.66 +139%
EBITDA - pre AASB16 ($M) 4.57 0.71 +544%
GCI ($M) 80.66 47.92 +68%
PUM 3,517 4,838 -27%
Home Loan Approvals (MSA) ($M) 170.6 137.4 +24%
5.3. Financial Review
The financial statements have been prepared on a going concern basis, which contemplates the continuity of normal
business activity and the realisation of assets and the settlement of liabilities in the ordinary course of business.
The Agency continued its growth during FY2021 delivering three quarters of positive EBITDA as well as a positive year to
date cash flow, a first for the Company. For FY2021, the Group recorded positive EBITDA of approximately $6.37 million.
EBITDA was calculated as provided following.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
EBITDA calculation 2021 2020
$ $
Loss after tax (1,856,455) (9,065,337)
Income tax benefit (1,894,024) (1,291,720)
Loss before tax (3,750,479) (10,357,057)
Interest income (18,724) (17,988)
Depreciation and amortisation 5,465,814 6,038,609
Embedded derivative non-cash financing costs2 2,243,784 -
Impairment 400,000 5,230,330
Interest and finance costs 2,010,936 1,769,193
Profit on Sale of Assets3 (200,612) -
Share-based payments expense 215,946 -
EBITDA 6,366,665 2,663,087
AASB 16 Leases impact4 (1,793,866) (1,951,373)
EBITDA (pre-AASB16 Leases impact) 4,572,799 711,714
EBITDA was $6.37 million. After adjusting for AASB 16 Leases impact, positive EBITDA for the year was $4.57 million which
compares to positive EBITDA of $0.71 million for FY2020, a $3.86 million improvement.
The net assets of the Group have increased from 30 June 2020 by $2.53 million to $14.14 million at 30 June 2021 (2020:
$11.61 million).
The Group incurred a net loss after tax for the year of $1.86 million (2020: $9.07 million loss). It is important to note that
this was primarily impacted by the embedded derivative non-cash financing cost ($2.24 million), interest and finance costs
($2.01 million), and depreciation and amortisation ($5.47 million).
As at 30 June 2021, the Group's cash and cash equivalents increased from 30 June 2020 by $2.37 million to $5.10 million
at 30 June 2021 (2020: $2.72 million).
2021
$’000
Cash at bank (reference financial statements note 5.1) 5,096
Cash classified as
◼ Bank Guarantees 613
Reporting in the 30 June 2021 Appendix 4C 5,709
Government incentives and related grants have been received during the year and were used to also support employee
sales agents in Perth. These have been included in operational cash flows.
5.4. Events Subsequent to Reporting Date
There are no other significant after balance date events that are not covered in this Directors' Report or within the financial
statements as disclosed in note 13 Events subsequent to reporting date on page 60.
2 Refer to note 2.1 of the financial statements
3 Sale of West Coast rent roll assets to Managex. Includes profit on sale of net assets disposed of $123K + Gain on exit of lease of $77K
4 AASB 16 Leases was adopted from 1 July 2019. The above demonstrates finance costs and amortisation, which prior to the adoption AASB 16
was recognised as rent expense.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Directors' report
5.5. Future Developments, Prospects and Business Strategies
With the Group having achieved a profitable scale, The Agency’s national focus has now shifted to quality agent recruitment
for driving growth while maintaining a sustainable financial framework and continuing to identify and implement
efficiencies into its business.
The Company has continued to work proactively with its primary bank debt provider, Macquarie Bank, regarding a
reduction in funding costs as well as the release of personal guarantees on its secured debt facilities, both of which have
been approved by the debt provider and announced on the 4th August 2021.
The Agency is active in pursuing new business channels and entering new markets, along with new strategic partnerships
and JV opportunities it believes will drive agent recruitment and sales revenue in the coming reporting periods.
There remain significant intangible assets off the balance sheet, these include the rent roll and the Mortgage Book. These
assets contribute an annuity income to the business in excess of $8 million per annum. Total estimated market asset value
of the rent roll and loan book is estimated to be greater than $25 million.
Other likely developments, future prospects and business strategies of the operations of the Group and the expected
results of those operations, not otherwise disclosed in this report, have not been included in this report as the Directors
believe that the inclusion of such information would be likely to result in unreasonable prejudice to the Group.
5.6. Environmental Regulations
The Group's operations are not subject to any significant environmental regulations in the jurisdictions it operates in.
6. Information relating to the Directors
◼ Mr Andrew Jensen Executive Chairman and Chief Operating Officer
Non-independent
Qualifications FIPA, MAICD
Experience Mr Jensen previously held the position of Chief Financial Officer for International and leading
Australian Companies, which will greatly assist the Company in its next phase of national
growth under the two prominent brands of The Agency and Sell Lease Property.
Mr Jensen has strong commercial, strategic, and M&A experience and has financially led
companies engaged in various fields including real estate, financial services,
telecommunications, and the franchising sectors both in Australia and Internationally.
He is an accomplished CFO with over 18 years’ experience in senior finance and management
roles. Previously, Mr Jensen was the CFO and Director of Australasia’s largest real estate group
Ray White, with over $20 billion in annual sales and one of Australia’s largest independent
mortgage broking businesses Loan Market. He has also been the CFO of VGC Food Group Pty
Ltd, a private diversified manufacturing and franchising group.
Mr Jensen was also CFO and COO of Digicel PNG (Papua New Guinea) part of Digicel Group
Limited (Digicel), one of the South Pacific’s largest and most successful telecommunications
companies. He is also a fellow of the Institute of Public Accountants and member of the
Australian Institute of Company Directors.
Interest in Shares and Indirect 1,903,492 Ordinary Shares
Options
Directorships held in RESA Group Limited
other listed entities Freedom Insurance Group Limited (resigned 29 April 2019)
during the three years
prior to the current year
◼ Mr Paul Niardone Managing Director
Non-independent
Qualifications MBA, BA
B
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
Experience Mr Niardone was the Executive Director and founder of Professional Public Relations (WA), the
largest PR and communications firm in the State until he sold the business to WPP. He has
experience in marketing and strategic planning for clients in both Government and the private
sector. With a degree in Politics and Industrial Relations and a Master’s in Business
Administration, he started his career in the Department of Cabinet and Parliamentary Services.
He was appointed inaugural Manager of the Peel Region Business Enterprise Centre, and was
then appointed as the first Marketing Manager for the entire Enterprise Centre Network
comprising 36 centres throughout WA.
Mr Niardone's marketing skills were recognised by Westpac in its decision to appoint him as
one of the first Business Banking Managers in Australia without a banking background.
His career to date has provided him with a unique opportunity to gain experience, insights and
contacts in a wide range of industries at the CEO and Board level.
He has sat on the boards of a number of public and private companies and not for profit
organisations.
Interest in Shares and Indirect 3,187,007 Ordinary Shares
Options 116,237 Performance Shares
Directorships held in MinQuest Limited
other listed entities
during the three years
prior to the current year
◼ Mr Matthew Lahood Executive Director
Non-independent
Experience Mr Lahood is synonymous with Australian real estate, during more than two decades at the
forefront of the industry, he has honed his expertise in everything from property sales to
auctioneering. Having personally coached and mentored many of the industry’s finest sales
agents to become million-dollar writers, Mr Lahood knows what it takes to significantly grow
their businesses. He is also well known around Australia for his outstanding leadership skills
and for building super sales and operational teams. He has been recognised with countless
performance awards and is considered a thought leader within the Australian real estate
space. Mr Lahood provides media commentary on a national level and is a regular keynote
speaker at real estate and financial events.
Mr Lahood’s love of real estate is only outshone by his passion for helping people grow
personally and professionally. For over 28 years, he has stood firmly by his values of humility,
transparency and integrity, values that he has passed onto many who have been lucky enough
to work alongside him.
Interest in Shares and Indirect 24,804,398 Ordinary Shares
Options
Directorships held in Nil
other listed entities
during the three years
prior to the current year
◼ Mr Adam Davey Non-executive Director
Non-independent
Experience Mr Davey is a Director, Director – Wealth Management, Canaccord Genuity Financial Limited.
Mr Davey's expertise spans over 25 years and includes capital raising (both private and public),
mergers and acquisition, ASX listings, asset sales and purchases, transaction due diligence and
director duties.
Mr Davey has been involved in significantly growing businesses in both the industrial and
mining sector. This has been achieved through holding various roles within different
organisations, including Chairman, Managing Director, Non-executive director, major
shareholder or corporate adviser to the board.
Mr Davey is also the Chairman of Teen Challenge Foundation, the largest Youth Drug and
Alcohol Rehabilitation Centre in Western Australia.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Directors' report
Interest in Shares and Direct 266,667 Performance Shares
Options Indirect 1,064,307 Ordinary Shares
333,0000 Options
Directorships held in Ensurance Limited
other listed entities Painchek Ltd
during the three years
prior to the current year
7. Meetings of Directors and committees
During the financial year, 14 meetings of Directors (including committees of Directors) were held. Attendances by each Director
during the year are stated in the following table.
DIRECTORS' REMUNERATION AND FINANCE AND OPERATIONS AUDIT
MEETINGS NOMINATION COMMITTEE COMMITTEE COMMITTEE
Number Number Number Number
eligible to Number eligible to Number eligible to Number eligible to Number
attend Attended attend Attended attend Attended attend Attended
Paul Niardone 14 14
At the date of this report, the Audit, Nomination, and Finance and Operations
Committees comprise the full Board of Directors. The Directors believe the
Andrew Jensen 14 14
Company is not currently of a size nor are its affairs of such complexity as to
warrant the establishment of these separate committees. Accordingly, all
Adam Davey 14 13
matters capable of delegation to such committees are considered by the full
Board of Directors.
Matthew Lahood 14 14
8. Indemnifying officers or auditor
8.1. Indemnification
The Company has paid premiums to insure each of the current and former Directors and officers against liabilities for costs
and expenses incurred by them in defending any legal proceedings arising out of their conduct while acting in the capacity
of Director or Officer of the Company, other than conduct involving a wilful breach of duty in relation to the Company. The
Company has not given any further indemnity or entered into any other agreements to indemnify, or pay or agree to pay
insurance premiums.
No indemnities have been given or insurance premiums paid, during or since the end of the period, for any person who is
or has been an auditor of the Company
8.2. Insurance premiums
The contract of insurance prohibits disclosure of the nature of liability and the amount of the premium.
9. Options
9.1. Unissued shares under option
At the date of this report, the unissued ordinary shares of the Company under option (listed and unlisted) are as follows:
Grant Date Date of Expiry Exercise Price Number under Vested &
$ Option Exercisable
28 Nov 2018 11 Jan 2022 0.300 333,333 333,333
333,333 333,333
On the commencement of employment, the Company granted Mr Lucas 30,000,000 options in accordance with his
employment agreement. These options have not yet vested and have not yet been issued by the Company. For further
details refer to the financial statements note 19.2.1a.
No person entitled to exercise the option has or has any right by virtue of the option to participate in any share issue of
any other body corporate.
9.2. Shares issued on exercise of options
A total of 14,000,000 ordinary shares have been issued by the Company during the financial year as a result of the exercise
of options (2020: nil).
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
10. Non-audit services
During the year, Hall Chadwick WA Audit Pty Ltd (formerly known as Bentleys Audit & Corporate (WA) Pty Ltd) (Hall Chadwick),
the Company’s and Group’s auditor, provided non-audit services of $4,700 (2020: nil), in addition to their statutory audits. Details
of remuneration paid to the auditor can be found within the financial statements at note 17 Auditor's Remuneration on page 61.
If non-audit services are provided by Hall Chadwick, the Board has established certain procedures to ensure that the provision
of non-audit services are compatible with, and do not compromise, the auditor independence requirements of the Corporations
Act 2001 (Cth). These procedures include:
◼ non-audit services will be subject to the corporate governance procedures adopted by the Company and will be reviewed by
the Board to ensure they do not impact the integrity and objectivity of the auditor; and
◼ ensuring non-audit services do not involve reviewing or auditing the auditor's own work, acting in a management or decision-
making capacity for the Company, acting as an advocate for the Company or jointly sharing risks and rewards.
11. Proceedings on behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 (Cth) for leave to bring proceedings on behalf
of the Company, or to 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 part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section 237 of the
Corporations Act 2001.
12. Corporate Governance
In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of The Agency support
and have substantially adhered to the best practice recommendations set by the ASX Corporate Governance Council. For a
detailed analysis of the Company’s Corporate Governance Policies, visit the corporate governance section of our website at
www.investors.theagency.com.au/corporate-governance.
13. Auditor's independence declaration
The lead auditor's independence declaration under section 307C of the Corporations Act 2001 (Cth) for the year ended
30 June 2021 has been received and can be found on page 22 of the annual report.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Directors' report
14. Remuneration report (audited)
This report outlines the remuneration arrangements in place for Directors and key management personnel of the Company for
the year ended 30 June 2021. The information in this remuneration report has been audited as required by s308(3C) of the
Corporations Act 2001 (Cth).
14.1. Key management personnel (KMP)
This remuneration report details the remuneration arrangements for KMP who are defined as those persons having
authority and responsibility for planning, directing and controlling the major activities of the Company and the Group,
directly or indirectly, including any director (whether Executive or otherwise) of the parent company, and includes those
Executives in the Parent and the Group receiving the highest remuneration. KMP comprise the Directors of the Company
and key executive personnel:
◼ Andrew Jensen Executive Chairman and Chief Operating Officer
◼ Paul Niardone Managing Director
◼ Adam Davey Non-Executive Director
◼ Matt Lahood Executive Director
◼ Geoff Lucas Chief Executive Officer (CEO) (appointed 29 March 2021)
◼ Arjan van Ameyde Chief Financial Officer (CFO)
◼ Former directors included in comparative information:
Mitchell Atkins Non-Executive Director (appointed 1 October 2019, resigned 8 May 2020)
John Kolenda Non-Executive Director (resigned 20 December 2019)
14.2. Principles used to determine the nature and amount of remuneration
a. Remuneration Policy
The remuneration policy of The Agency Group Australia Limited has been designed to align director and management
objectives with shareholder and business objectives by providing a fixed remuneration component, and offering
specific long-term incentives, based on key performance areas affecting the Group’s financial results. The Board
believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best management
and directors to run and manage the Group, as well as create goal congruence between directors, executives and
shareholders.
The remuneration policy, setting the terms and conditions for the executive directors and other senior executives, was
developed by the Board.
All remuneration paid to Directors and executives is valued at the cost to the Company and expensed.
The Board policy is to remunerate non-executive Directors at the lower end of market rates for comparable companies
for time, commitment, and responsibilities. The maximum aggregate amount of fees that can be paid to non-executive
Directors is subject to approval by shareholders at the Annual General Meeting (AGM). Fees for non-executive Directors
are not linked to the performance of the Group.
b. Performance Conditions Linked to Remuneration
The Group seeks to establish and maintain The Agency Group Australia Limited Performance Rights Plan (Plan) to
provide ongoing incentives to any full time or part time employee, consultant or any person nominated by the Board
(including director or company secretary of the Company who holds salaried employment with the Company on a full
or part time basis) (Eligible Participants) of the Company.
The Board adopted the Plan to allow Eligible Participants to be granted Performance Rights to acquire shares in the
Company.
The objective of the Plan is to provide the Company with a remuneration mechanism, through the issue of securities in
the capital of the Company, to motivate and reward the performance of Eligible Participants in achieving specified
performance milestones within a specified performance period. The Board will ensure that the performance milestones
attached to the securities issued pursuant to the Plan are aligned with the successful growth of the Company’s business
activities.
c. Remuneration structure
In accordance with best practice corporate governance, the structure of Non-Executive Director and Executive
compensation is separate and distinct.
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14. Remuneration report (audited)
(1) Non-executive director remuneration
The Board seeks to set aggregate remuneration at a level which provides the Company with the ability to attract
and retain directors of the highest calibre, whilst incurring a cost which is acceptable to shareholders.
The Constitution and the ASX Listing Rules specify that the aggregate remuneration of non‐executive directors shall
be determined from time to time by a general meeting. An amount not exceeding the amount determined is then
divided between the Directors as agreed. The latest determination was at the Annual General Meeting held on 29
April 2016 when shareholders approved an aggregate remuneration of $250,000 per year. The Board considers
advice from external consultants when undertaking the annual review process.
(2) Executive remuneration
Senior executives, including Executive Directors, are engaged under the terms of individual employment contracts.
Such contracts are based upon standard terms drafted by the Company’s lawyers. Base salary/consulting fees are
set to reflect the market salary for a position and individual of comparable responsibility and experience. Base
salary/consulting fees are regularly compared with the external market and during recruitment activities generally.
It is the policy of the Company to maintain a competitive salary structure to ensure continued availability of
experienced and effective management and staff.
Executives are prohibited from entering into transactions or arrangements which limit the economic risk of
participating in unvested entitlements.
Details of the nature and amount of each element of each Director, including any related company and each KMP
are set out below.
d. Contractual arrangements of members of KMP
(1) Executive Services Agreement (ESA) – Paul Niardone
Mr Paul Niardone entered into an ESA, revised on 11 January 2019, with the Company to be employed as Managing
Director upon and subject to the terms and conditions of the ESA. The key terms of this agreement are disclosed
below:
(A) Remuneration
(i) Mr Niardone will receive a salary of $390,000 per year, exclusive of superannuation, which will be reviewed
annually by the Company (Salary)(as revised on 11 January 2019).
(ii) Mr Niardone will not receive any further director’s fees in addition to the Salary from the Company during
such period as Mr Niardone serves as a director of the Company as determined by the Board.
(iii) In addition, the Company may at any time during the term of the ESA pay Mr Niardone a performance-
based bonus over and above his salary. In determining the extent of any performance-based bonus, the
Company shall take into consideration the key performance indicators of Mr Niardone and the Company,
as the Company may set from time to time, and any other matter that it deems appropriate.
(iv) The Company paid operating lease payments for a motor vehicle, on behalf of Mr Niardone, in the amount
of $25,576 for the year.
(v) The Company shall provide to Mr Niardone, at its own cost, life insurance protection on similar terms to the
life insurance protection currently offered by the Company.
(vi) The Company will make employer superannuation contributions on behalf of Mr Niardone.
(vii) The Company will reimburse Mr Niardone for all reasonable travelling intra/interstate or overseas,
accommodation, and general expenses incurred in the performance of all duties in connection with the
business of the Company and its related bodies corporate.
(viii) Mr Niardone is entitled to all leave in accordance with the National Employment Standard (NES) and
Western Australian long service leave legislation.
(B) Termination by the Company without reason
The Company may at its sole discretion terminate employment by giving twelve months' written notice and, at
the end of that notice period, making a payment to Mr Niardone equal to the salary payable over a twelve-
month period. The Company may elect to pay Mr Niardone the equivalent of the twelve months' salary and
dispense with the notice period (as revised on 11 January 2019).
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ABN 52 118 913 232
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14. Remuneration report (audited)
(C) Termination by Mr Niardone
Mr Niardone may at his sole discretion terminate the Employment in the following manner:
(i) if at any time the Company commits any serious or persistent breach of any of the provisions contained in
the ESA and the breach is not remedied within 28 days of receipt of written notice from Mr Niardone to the
Company to do so, by giving notice effective immediately; or
(ii) by giving three months' written notice to the Company.
(2) ESA – Matthew Lahood
(A) Remuneration
(i) Mr Lahood will receive a salary of $650,000 per year, exclusive of superannuation, which will be reviewed
annually by the Company (Salary).
(ii) Up to 1 January 2021, Mr Lahood received director’s fees of $3,000 per month, from the Company in
addition to the Salary, as compensation for service as a director of the Company.
(iii) In addition, the Company may at any time during the term of the ESA pay Mr Lahood a performance-based
bonus over and above his salary. In determining the extent of any performance-based bonus, the Company
shall take into consideration the key performance indicators of Mr Lahood and the Company, as the
Company may set from time to time, and any other matter that it deems appropriate.
(iv) Up to 1 January 2021, the Company provided a motor vehicle allowance of up to $22,000 per year.
(v) The Company will make employer superannuation contributions on behalf of Mr Lahood.
(vi) The Company will reimburse Mr Lahood for all reasonable travelling intra/interstate or overseas,
accommodation, and general expenses incurred in the performance of all duties in connection with the
business of the Company and its related bodies corporate.
(vii) Mr Lahood is entitled to all leave in accordance with the NES.
(B) Termination by the Company without reason
The Company may at its sole discretion terminate employment by giving three months' written notice and, at
the end of that notice period, making a payment to Mr Lahood equal to the salary payable over a five-month
period. The Company may elect to pay Mr Lahood the equivalent of the six months' salary and dispense with
the notice period
(C) Termination by Mr Lahood
Mr Lahood may at his sole discretion terminate the Employment in the following manner:
(i) if at any time the Company commits any serious or persistent breach of any of the provisions contained in
the ESA and the breach is not remedied within 28 days of receipt of written notice from Mr Lahood to the
Company to do so, by giving notice effective immediately; or
(ii) by giving three months' written notice to the Company.
(3) Letter of Appointment – Adam Davey
On 16 August 2016, Adam Davey executed a letter of appointment to become a non-executive Director of the
Company.
(A) Term
Mr Davey’s service commenced on the date of completion of the acquisition of Ausnet Real Estate Services Pty
Ltd by the Company and will cease when he resigns, retires or is removed from office in accordance with the
Company’s constitution or the Corporations Act 2001 (Cth).
(B) Fee
Mr Davey will be paid a fee of $48,000 per annum for his role as a non-executive Director of the Company.
Any fees paid to Mr Davey will in any event be subject to annual review by the Board of the Company and
approval by Shareholders (if required). The Company will reimburse Mr Davey for all reasonable expenses
incurred in performing his duties
(4) Letter of Appointment – Andrew Jensen
On 15 February 2019, Andrew Jensen executed a letter of appointment to become a non-executive Director of the
Company effective from Settlement.
(A) Term
Mr Jensen’s service commenced from 18 February 2019, and will cease when he resigns, retires or is removed
from office in accordance with the Company’s constitution or the Corporations Act 2001 (Cth).
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30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
14. Remuneration report (audited)
(B) Fee
Mr Jensen will be paid a fee of $60,000 per annum for his role as a non-executive Director of the Company. Any
fees paid to Mr Jensen will in any event be subject to annual review by the Board of the Company and approval
by Shareholders (if required). The Company will reimburse Mr Jensen for all reasonable expenses incurred in
performing his duties.
(5) Executive Services Agreement (ESA) – Andrew Jensen
Mr Andrew Jensen entered into an ESA with the Company to be employed as Chief Operating Officer upon and
subject to the terms and conditions of the ESA. The key terms of this agreement are disclosed below
(A) Remuneration
(i) Mr Jensen will receive a salary of $350,000 per year, exclusive of superannuation, which will be reviewed
annually by the Company (Salary).
(ii) Mr Jensen will continue to receive director’s fee as detailed in (4) above.
(iii) In addition, the Company may at any time during the term of the ESA pay Mr Jensen a performance-based
bonus over and above his salary. In determining the extent of any performance-based bonus, the Company
shall take into consideration the key performance indicators of Mr Jensen and the Company, as the
Company may set from time to time, and any other matter that it deems appropriate.
(iii) The Company will make employer superannuation contributions on behalf of Mr Jensen.
(iv) The Company will reimburse Mr Jensen for all reasonable travelling intra/interstate or overseas,
accommodation, and general expenses incurred in the performance of all duties in connection with the
business of the Company and its related bodies corporate.
(v) Mr Jensen is entitled to all leave in accordance with the NES and Western Australian long service leave
legislation.
(B) Termination by the Company without reason
The Company may at its sole discretion terminate employment by giving three months' written notice and, at
the end of that notice period, making a payment to Mr Jensen equal to the salary payable over a three-month
period. The Company may elect to pay Mr Jensen the equivalent of the six months' salary and dispense with
the notice period
(C) Termination by Mr Jensen
Mr Jensen may at his sole discretion terminate the Employment in the following manner:
(i) if at any time the Company commits any serious or persistent breach of any of the provisions contained in
the ESA and the breach is not remedied within 28 days of receipt of written notice from Mr Jensen to the
Company to do so, by giving notice effective immediately; or
(ii) by giving two months' written notice to the Company.
(6) Letter of Appointment – Mitchell Atkins
On 30 September 2019, Mr Atkins executed a letter of appointment to become a non-executive Director of the
Company effective from Settlement. This agreement terminated upon Mr Atkins’ resignation 8 May 2020.
(A) Term
Mr Atkins service commenced on 1 October 2019 and ceased when he resigned on 8 May 2020.
(B) Fee
Mr Atkins was paid a fee of $48,000 per annum for his role as a non-executive Director of the Company. Any
fees paid to Mr Atkins were in any event be subject to annual review by the Board of the Company and approval
by Shareholders (if required). The Company reimbursed Mr Atkins for all reasonable expenses incurred in
performing his duties.
(7) Letter of Appointment – John Kolenda
On 16 August 2016, John Kolenda executed a letter of appointment to become a non-executive Director of the
Company effective from Settlement. This agreement terminated upon Mr Kolenda’s resignation 20 December 2019.
(A) Term
Mr Kolenda’s service will commence on the date of completion of the acquisition of Ausnet Real Estate Services
Pty Ltd by the Company and ceased when he resigned on 20 December 2019.
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AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Directors' report
14. Remuneration report (audited)
(B) Fee
Mr Kolenda was paid a fee of $48,000 per annum for his role as a non-executive Director of the Company. Any
fees paid to Mr Kolenda were in any event be subject to annual review by the Board of the Company and
approval by Shareholders (if required). The Company reimbursed Mr Kolenda for all reasonable expenses
incurred in performing his duties.
(8) Executive Services Agreement (ESA) – Arjan Van Ameyde
Mr Arjan Van Ameyde entered into an ESA, revised on 11 December 2019 (commencing 1 February 2020), with the
Company to be employed as Chief Financial Officer upon and subject to the terms and conditions of the ESA. The
key terms of this agreement are disclosed below:
(A) Remuneration
(i) Mr Van Ameyde will receive a salary of $250,000 per year, exclusive of superannuation, which will be
reviewed annually by the Company (Salary).
(ii) Mr Van Ameyde shall be entitled to payment of $10,000 following the one-year anniversary of the
1 February 2020, subject to achievement by the CFO of key performance indicators.
(iii) In addition, the Company may at any time during the Term pay to Mr Van Ameyde a performance-based
bonus over and above the Salary
(iv) Mr Van Ameyde shall be entitled to participate in an Executive Share Scheme
(v) The Company will make employer superannuation contributions on behalf of Mr Van Ameyde and will
reimburse Mr Van Ameyde for all reasonable travelling, accommodation, and general expenses incurred in
the performance of all duties.
(vi) Mr Van Ameyde is entitled to all leave in accordance with the NES and Western Australian long service leave
legislation.
(B) Termination by the Company without reason
The Company may at its sole discretion terminate employment by giving three months' written notice and at
the end of that notice period, making a payment to Mr Van Ameyde of one month’s salary. The Company may
elect to pay Mr Van Ameyde the equivalent of the four months’ salary and dispense with the notice period.
(C) Termination by Mr Van Ameyde
Mr Van Ameyde may at his sole discretion terminate the Employment in the following manner:
(i) if at any time the Company commits any serious or persistent breach of any of the provisions contained in
the ESA and the breach is not remedied within 28 days of receipt of written notice from Mr Van Ameyde to
the Company to do so, by giving notice effective immediately; or
(ii) by giving three months' written notice to the Company.
(9) Employment Agreement (EA) – Geoff Lucas
Mr Geoff Lucas entered into an EA, commencing on 29 March 2021, with the Company to be employed as Chief
Executive Officer upon and subject to the terms and conditions of the EA. The key terms of this agreement are
disclosed below:
(A) Salary Package $550,000 inclusive of superannuation (not to increase for first 2 years of employment),
plus short term and long-term incentive payments which will be subject to achievement
of key performance indicators to be set and approved with and by the Board of The
Agency.
(B) Leave provisions In accordance with applicable legislation.
(C) Probationary Period Six-month probationary period. At any time during this period, either party may
terminate the employment by providing one week’s written notice to the other party.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
14. Remuneration report (audited)
(D) Equity issues On the Commencement Date, the Company will issue Mr Lucas with 30 million unlisted
options to acquire fully paid ordinary shares in the capital of the Company (Unlisted
Options) with the following terms:
◼ 10 million Unlisted Options exercisable at 5 cents each which will vest 60 days after
conclusion of the Probationary Period and are exercisable on or before 12 months
after conclusion of the Probationary Period (approximately September 2022).
◼ 10 million Unlisted Options exercisable at 7.5 cents each which will vest on the 12-
month anniversary date of conclusion of the Probationary Period and are exercisable
on or before 12 months from vesting (approximately September 2023).
◼ 10 million Unlisted Options exercisable at 10 cents each which will vest on the 24-
month anniversary date of conclusion of the Probationary Period and are exercisable
on or before 12 months from vesting (approximately September 2024).
If the employment is terminated by either party, the Unlisted Options will be cancelled
or lapsed.
If all Unlisted Options are exercised the total payable by Mr Lucas will be $2.25 million.
(E) Termination Following the Probationary Period, the Company may terminate the employment
without cause, or Mr Lucas may resign from the employment, with six months’ written
notice to the other party. The employment agreement also contains summary
termination provisions considered standard for an agreement of this type.
e. Voting and comments made at the Company’s 2020 Annual General Meeting (AGM)
At the Annual General Meeting held on 4 January 2021, the Company received 166,343,185 (98.82%) For votes and
1,992,781 (1.18%) Against votes and 15,150 abstentions on its remuneration report for the 2020 financial year. The
Group did not employ a remuneration consultant during the year.
14.3. Performance-based remuneration
a. The following table provides employment details of persons who were, during the financial year, members of KMP of
the Group. The table also illustrates the proportion of remuneration that was performance based and the proportion
of remuneration received in the form of options.
Position Held as at Contract Proportions of Elements of Proportions of Elements of Total
Group KMP 30 June 2021 and any Commencement / Remuneration Related to Performance Remuneration Not Related
change during the Termination Date to Performance
year Non-salary Fixed Salary/ Fixed Salary/
Cash-based Options / Fees – cash Fees – share-
Incentives Shares Rights based based
% % % % % %
Andrew Jensen Executive Chairman Appt. 18.02.2019 (Dir) - - - 100 - 100
and COO Appt. 1.02.2020 (COO)
Paul Niardone Managing Director 11.01.2019 - - - 100 - 100
Adam Davey Non-Executive 16.08.2016 - - - 100 - 100
Director
Matthew Lahood Executive Director 17.02.2019 14 - - 86 - 100
Geoff Lucas(1) Chief Executive Appt. 29.03.21 - - - 36 64 100
Officer
Arjan van Ameyde Chief Financial Appt. 1.02.20 4 - - 96 - 100
Officer
(1) On the commencement of employment, the Company granted Mr Lucas 30,000,000 options (to be issued) in accordance with his employment
agreement. These options have not yet vested. For further details refer to the financial statements note 19.2.1a.
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AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Directors' report
14. Remuneration report (audited)
b. Statutory performance indicators
The Group aims to align our executive remuneration to our strategic and business objectives and the creation of
shareholder wealth. Reported below are measures of the Group’s financial performance over the last five years as
required by the Corporations Act 2001 (Cth). However, these are not necessarily consistent with the measures used in
determining the variable amounts of remuneration to be awarded to KMPs. As a consequence, there may not always
be a direct correlation between the statutory key performance measures and the variable remuneration awarded.
2021 2020 2019 2018 2017
Loss for the year attributable to owners of (1,856,455) (9,065,337) (7,830,605) (3,742,251) (3,804,242)
the Company ($)
Basic earnings per share (cents) (0.53) (3.60) (12,71) (17.58) (0.95)
Dividend payments ($’000) Nil Nil Nil Nil Nil
Dividend payout ratio (%) N/A N/A N/A N/A N/A
Share price 0.05 0.043 0.070 0.148 0.427
Increase/(decrease) in share price (%) 16.28 (38.57) (52.70) (65.34) N/A#
# Prior to FY2017 the Company was incorporated as an exploration company. Comparisons to periods prior to FY2017 are not relevant to the
current trading of the company
14.4. Directors and KMP remuneration
Details of the nature and amount of each element of the remuneration of each of the KMP of the Company (the Directors)
for the year ended 30 June 2021 are set out in the following tables:
Bonuses paid during the year were based on the achievement of agreed key performance indicators.
The following table of benefits and payments represents the components of the current year and comparative year
remuneration expenses for each member of KMP of the Group. Such amounts have been calculated in accordance with
Australian Accounting Standards.
2021 – Group
Short-term benefits Post- Long-term Termination Equity-settled share- Total
Group KMP employment benefits benefits based payments
benefits
Salary, fees Profit share Non- Other Super- Other Equity / Options
and leave and bonuses monetary annuation Perf. Rights
$ $ $ $ $ $ $ $ $ $
Andrew Jensen 410,000 - - - 21,694 - - - - 431,694
Paul Niardone 399,000 - - 25,576 21,694 - - - - 446,270
Adam Davey 48,000 - - - - - - - - 48,000
Matthew Lahood 563,181 86,940 - 25,500 21,694 - - - - 697,315
Geoff Lucas(1) (2) 116,498 - - - 5,424 - - - 215,946 337,868
Arjan van Ameyde 250,000 10,000 - - 21,694 - - - - 281,694
1,786,679 96,940 - 51,076 92,200 - - - 215,946 2,242,841
(1) Appointed 29 March 2021
(2)
On the commencement of employment, the Company granted Mr Lucas 30,000,000 options (to be issued) in accordance with his
employment agreement. These options have not yet vested. For further details refer to the financial statements note 19.2.1a.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
14. Remuneration report (audited)
2020 – Group
Short-term benefits Post- Long-term Termination Equity-settled share- Total
Group KMP employment benefits benefits based payments
benefits
Salary, fees Profit share Non- Other Super- Other Equity Option
and leave and bonuses monetary annuation
$ $ $ $ $ $ $ $ $ $
Andrew Jensen(4) 176,256 - - - 10,752 - - - - 187,008
Paul Niardone(4) 315,000 - - 24,752 21,003 - - - - 360,755
Adam Davey(4) 46,982 - - - - - - - - 46,982
Matthew Lahood 500,267 - - 20,167 25,000 - - - - 545,434
Mitchell Atkins(1) 32,000 - - - - - - - - 32,000
John Kolenda(2) (4) 18,182 - - - - - - - - 18,182
Arjan van Ameyde(3) 76,282 - - - 7,247 - - - - 83,529
1,164,969 - - 44,919 64,002 - - - - 1,273,890
(1) Appointed 1 October 2019, resigned 8 May 2020
(2) Resigned 20 December 2019
(3) Appointed 1 February 2020
(4)
The following shares were issued to Directors to settle accrued outstanding Amount Shares
Directors’ fees from the prior year:
S No.
Paul Niardone 116,719 1,795,682
Andrew Jensen 118,500 1,823,077
John Kolenda 87,494 1,346,061
Adam Davey 66,000 1,015,385
Total 388,713 5,980,205
14.5. Share-based compensation
The Group believes that encouraging its directors and executives to become shareholders is the best way of aligning their
interests with those of its shareholders. At present the Group does not have an active employee share option plan.
During the 2020 financial year, the Company issued 5,980,205 ordinary shares to Directors to settle accrued outstanding
Directors’ fees (refer note 7.1.4).
There were no equity instruments issued during the year to Directors as a result of options exercised that had previously
been granted as compensation.
a. Securities received that are not performance-related
No members of KMP are entitled to receive securities that are not performance-based as part of their remuneration package.
b. Options and Rights Granted as Remuneration
During 2021 financial year, 30,000,000 options were granted (yet to issued) as share-based compensation during the year,
as detailed in note 19.2.1a. No shares or options were issued as share-based compensation during the 2020 financial year.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Directors' report
14. Remuneration report (audited)
14.6. KMP equity holdings
a. Fully paid ordinary shares of The Agency Group Australia Ltd held by each KMP
The number of ordinary shares of The Agency Group Australia Ltd held, directly, indirectly or beneficially, by each KMP,
including their personally-related entities for the year ended 30 June 2021 is as follows
2021 – Group Balance at start of Received during Received during the
year or the year as year on the exercise Other changes Balance at end of
Group KMP appointment compensation of options during the year year or resignation
No. No. No. No. No.
Andrew Jensen 1,903,492 - - - 1,903,492
Paul Niardone(1) 4,239,023 - - (1,052,016) 3,187,007
Adam Davey 1,064,307 - - - 1,064,307
Matthew Lahood 24,804,398 - - - 24,804,398
Geoff Lucas(2) - - - - -
Arjan van Ameyde(3) - - - - -
32,011,220 - - (1,052,016) 30,959,204
(1) Other movement for Mr Niardone represents shares indirectly held by an entity that discontinued to be a related entity in July 2020
as Mr Niardone ceased to have any control or significantly influence the financial or operating policies.
(2) Appointed 29 March 2021
(3) Appointed 1 February 2020
b. Options in The Agency Group Australia Ltd held by each KMP
The number of options over ordinary shares in The Agency Group Australia Ltd held, directly, indirectly or beneficially,
by each KMP, including their personally-related entities for the year ended 30 June 2021 is as follows:
2021 – Group Balance at Granted as Balance at
start of year or Remuneration Exercised Other changes end of year or Vested and
Group KMP
appointments during the year during the year during the year(3) resignation Exercisable Not Vested
No. No. No. No. No. No. No.
Andrew Jensen - - - - - - -
Paul Niardone 99,142 - - (99,142) - 99,142 (99,142)
Adam Davey 338,095 - - (4,762) 333,333 338,095 (4,762)
Matthew Lahood 9,622,044 - - (9,622,044) - 9,622,044 (9,622,044)
Geoff Lucas(1) (4) - 30,000,000 - - 30,000,000 - 30,000,000
Arjan van Ameyde(2) - - - - - - -
10,059,281 30,000,000 - (9,725,948) 30,333,333 10,059,281 20,274,052
(1) Appointed 29 March 2021
(2) Appointed 1 February 2020
(3) Other changes relate to the expiration of options
(4) On the commencement of employment, the Company granted Mr Lucas 30,000,000 options (to be issued) in accordance with his
employment agreement. These options have not yet vested. For further details refer to the financial statements note 19.2.1a.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
14. Remuneration report (audited)
c. Performance Shares of The Agency Group Australia Ltd held by each KMP
The number of Performance Shares in The Agency Group Australia Ltd held, directly, indirectly or beneficially, by each
KMP, including their personally-related entities for the year ended 30 June 2021 is as follows
2021 – Group Received during
Balance at Received during the year on Balance at
Group KMP start of year or the year as the exercise of Other changes end of year or Maximum value
appointments compensation options during the year resignation yet to vest
No. No. No. No. No. No.(1)
Andrew Jensen - - - - - -
Paul Niardone(2) 411,111 - - - 411,111 -
Adam Davey 266,667 - - - 266,667 -
Matthew Lahood - - - - - -
Geoff Lucas (3) - - - - - -
Arjan van Ameyde(4) - - - - - -
677,778 - - - 677,778 -
(1) The maximum value of the performance shares yet to vest was estimated based on the fair value of shares granted which was
valued at nil. The minimum value of the performance shares yet to vest is nil, as the shares will be forfeited if the vesting
conditions are not met
(2) Other movement for Mr Niardone represents shares indirectly held by an entity that discontinued to be a related entity in July
2020 as Mr Niardone ceased to have any control or significantly influence the financial or operating policies.
(3)
Appointed 29 March 2021
(4) Appointed 1 February 2020
The performance shares failed to vest (by achieving a 20-day volume VWAP on the ASX which equals or exceeds 3 times
the re-quotation price of $0.02, at any time within 24 months of settlement) and expired. These performance shares
will convert to five only ordinary shares, subsequent to balance date.
14.7. Other Equity-related KMP Transactions
There have been no other transactions involving equity instruments other than those described in the tables above relating
to options, rights, and shareholdings.
14.8. KMP Loans
There are no loans outstanding to or from KMP as at 30 June 2021 (2020: nil)
During the 2020 financial year MA SOF 56 Pty Ltd, (a Company of which former KMP, Mr Mitchel Atkins, was a director)
provided a loan to the Group of $150,000 of which the principal plus interest and fees was repaid in full. Interest and fees
associated with the loan was $91,820. Refer to note 7.1.3 of the financial statements for loans settled by way of equity
during the prior year (2021: nil).
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Directors' report
14. Remuneration report (audited)
14.9. Other transactions with KMP and or their Related Parties
Some Directors or former Directors of the Group hold or have held positions in other companies, where it is considered,
they control or significantly influence the financial or operating policies of those entities. During the year, the following
entities provided professional and corporate services to the Group.
Total Transactions Receivable/(Payable) Balance
Entity Nature of transactions KMP 2021 2020 2021 2020
$ $ $ $
Chapter One Advisers(1) Public Relations Paul Niardone 7,000 59,000 N/A (11,000)
Matt Lahood Advance commissions / Matt Lahood 90,000 44,050 84,074 52,783
Future fund
Aura Capital Pty Ltd Placement fees / John Kolenda - 415,089 - (71,509)
transaction fees
Magnolia Capital Professional services Mitchell Atkins - 30,170 - -
(1) Chapter One Advisers discontinued to be a related entity in July 2020 as Mr Niardone ceased to have any control or significantly
influence the financial or operating policies of Chapter One Advisers.
There have been no other transactions in addition to those described in the tables or as detailed in note 16 Related party
transactions.
END OF REMUNERATION REPORT
This Report of the Directors, incorporating the Remuneration Report, is signed in accordance with a resolution of the Board of
Directors made pursuant to s.298(2) of the Corporations Act 2001 (Cth).
PAUL NIARDONE
Managing Director
Dated this Wednesday, 29 September 2021
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Auditor's independence declaration
Under Section 307c Of The Corporations Act 2001 (Cth)
To The Directors Of THE AGENCY GROUP AUSTRALIA LTD
TO BE RECEIVED FROM
AUDITORS
P a g e | 22
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Consolidated statement of profit or loss and other comprehensive income
for the year ended 30 June 2021
Note 2021 2020
$ $
Continuing operations
Revenue 1.1 58,380,590 41,861,521
Other income 1.2 1,510,869 1,012,487
59,891,459 42,874,008
Advertising and promotion expenses (1,639,614) (1,242,399)
Computers and information technology expenses (1,407,621) (1,330,334)
Consultancy fees (2,048,190) (1,918,495)
Depreciation and amortisation (5,465,814) (6,038,609)
Embedded derivative non-cash financing costs 2.1 (2,243,784) -
Impairment 2.2 (400,000) (5,230,330)
Interest and finance costs (2,010,936) (1,769,193)
Legal and professional fees (1,328,244) (998,384)
Occupancy costs (570,823) (984,139)
Salaries and employment costs 2.3 (44,182,308) (31,070,020)
Share-based payments expense 19 (215,946) -
Other expenses (2,128,658) (2,649,162)
Loss before tax (3,750,479) (10,357,057)
Income tax benefit 4.1 1,894,024 1,291,720
Net loss for the year (1,856,455) (9,065,337)
Other comprehensive income, net of income tax
◼ Items that will not be reclassified subsequently to profit or loss - -
◼ Items that may be reclassified subsequently to profit or loss: - -
Other comprehensive income for the period, net of tax - -
Total comprehensive income attributable to members of the parent entity (1,856,455) (9,065,337)
Earnings per share: ₵ ₵
Basic loss per share (cents per share) 18.4 (0.53) (3.60)
Diluted loss per share (cents per share) 18.4 N/A N/A
6,366,665 2,663,087
The consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with the accompanying notes.
P a g e | 23
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Consolidated statement of financial position
as at 30 June 2021
Note 2021 2020
$ $
Current assets
Cash and cash equivalents 5.1 5,096,435 2,724,142
Trade and other receivables 5.2.1 8,353,403 4,601,222
Financial assets 5.3.1 - 1,600,000
Other current assets 5.4.1 323,438 550,476
Total current assets 13,773,276 9,475,840
Non-current assets
Trade and other receivables 5.2.2 163,010 269,655
Financial assets 5.3.2 612,860 170,388
Property, plant, and equipment 6.1 1,577,659 2,039,814
Right of use asset 6.2.1 4,894,370 4,645,320
Intangible assets 6.3 24,240,451 30,376,355
Total non-current assets 31,488,350 37,501,532
Total assets 45,261,626 46,977,372
Current liabilities
Trade and other payables 5.5.1 11,194,122 9,773,151
Borrowings 5.6.1 - 13,843,235
Provisions 6.4 2,565,406 2,286,835
Leases 6.2.2 1,828,270 1,979,900
Total current liabilities 15,587,798 27,883,121
Non-current liabilities
Borrowings 5.6.2 5,000,000 -
Financial liabilities 5.7.1 4,882,672 -
Provisions 6.4 280,245 337,054
Leases 6.2.2 4,016,900 3,895,077
Deferred tax liabilities 4.6 1,356,750 3,250,774
Total non-current liabilities 15,536,567 7,482,905
Total liabilities 31,124,365 35,366,026
Net assets 14,137,261 11,611,346
Equity - -
Issued capital 7.1.1 43,635,166 39,395,942
Reserves 7.4 1,071,861 928,715
Accumulated losses (30,569,766) (28,713,311)
Total equity 14,137,261 11,611,346
(1,814,522) (18,407,281)
(13,640,810) (15,514,235)
The consolidated statement of financial position is to be read in conjunction with the accompanying notes.
P a g e | 24
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Consolidated statement of changes in equity
for the year ended 30 June 2021
Note Share-based
Contributed Accumulated payment Total
equity Losses Reserve equity
$ $ $ $
Balance at 1 July 2019 27,765,049 (19,647,974) 583,426 8,700,501
Loss for the year attributable owners of the parent - (9,065,337) - (9,065,337)
Other comprehensive income for the year attributable
owners of the parent - - - -
Total comprehensive income for the year attributable
owners of the parent - (9,065,337) - (9,065,337)
Transaction with owners, directly in equity
Shares issued during the year (net of costs) 7.1.1 11,630,893 - - 11,630,893
Options granted during the year 7.3 - - 345,289 345,289
Balance at 30 June 2020 39,395,942 (28,713,311) 928,715 11,611,346
Balance at 1 July 2020 39,395,942 (28,713,311) 928,715 11,611,346
Loss for the year attributable owners of the parent - (1,856,455) - (1,856,455)
Other comprehensive income for the year attributable
owners of the parent - - - -
Total comprehensive income for the year attributable
owners of the parent - (1,856,455) - (1,856,455)
Transaction with owners, directly in equity
Shares issued during the year (net of costs) 7.1.1 3,552,768 - - 3,552,768
Options granted during the year 7.3 - - 437,946 437,946
Options exercised during the year 7.1.1, 7.3 686,456 - (294,800) 391,656
Balance at 30 June 2021 43,635,166 (30,569,766) 1,071,861 14,137,261
The consolidated statement of changes in equity is to be read in conjunction with the accompanying notes.
P a g e | 25
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Consolidated statement of cash flows
for the year ended 30 June 2021
Note 2021 2020
$ $
Cash flows from operating activities
Receipts from customers 71,571,138 42,529,458
Payments to suppliers and employees (65,947,300) (40,821,013)
Interest received 18,440 17,988
Finance costs (998,889) (1,391,729)
Net cash used in operating activities 5.1.2a 4,643,389 334,704
Cash flows from investing activities
Purchase of property, plant, and equipment (242,158) (282,527)
Advancement of bank guarantee - (481,498)
Return of bank guarantee - 346,078
Purchase of intangibles - (192,758)
Deferred purchase consideration paid - (15,000)
Loans to other entities (225,000) -
Net cash received on disposal of asset group 1.2.1 2,623,330 -
Net cash used in investing activities 2,156,172 (625,705)
Cash flows from financing activities
Proceeds from issue of shares - 5,611,773
Proceeds from exercise of options 391,656 -
Share issue costs (60,000) (397,861)
Repayments of borrowings 5.1.2b (7,843,235) (2,731,516)
Proceeds from borrowings 5.1.2b 5,000,000 -
Payment of principal portion of lease liabilities (1,915,689) (2,064,552)
Net cash provided by financing activities (4,427,268) 417,844
Net increase in cash and cash equivalents held 2,372,293 126,843
Cash and cash equivalents at the beginning of the year 2,724,142 2,597,299
Cash and cash equivalents at the end of the year - 5.1 5,096,435 2,724,142
The consolidated statement of cash flows is to be read in conjunction with the accompanying notes.
P a g e | 26
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
In preparing the 2021 financial statements, The Agency Group Australia Ltd has grouped notes into sections under five key
categories:
◼ Section A: How the numbers are calculated ............................................................................................................................28
◼ Section B: Risk..........................................................................................................................................................................53
◼ Section C: Group structure ......................................................................................................................................................57
◼ Section D: Unrecognised items ................................................................................................................................................60
◼ Section E: Other Information ...................................................................................................................................................61
Significant accounting policies specific to each note are included within that note. Accounting policies that are determined to be
non-significant are not included in the financial statements.
The financial report is presented in Australian dollars, except where otherwise stated.
P a g e | 27
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
SECTION A. HOW THE NUMBERS ARE CALCULATED
This section provides additional information about those individual line items in the financial statements that the Directors
consider most relevant in the context of the operations of the entity, including:
(a) accounting policies that are relevant for an understanding of the items recognised in the financial statements. These cover
situations where the accounting standards either allow a choice or do not deal with a particular type of transaction.
(b) analysis and sub-totals.
(c) information about estimates and judgements made in relation to particular items.
Note 1 Revenue and other income
2021 2020
$ $
1.1 Revenue
Commissions 45,342,382 27,523,456
Fees 5,563,760 5,056,193
Management fees 7,474,448 9,281,872
58,380,590 41,861,521
1.2 Other Income
Interest income 18,724 17,988
Gain on disposal of assets 1.2.1 123,225 -
Gain on exit of lease 77,387 -
Other income 567,121 994,499
Government grants received – Cash Flow Boost 724,412 -
1,510,869 1,012,487
1.2.1 In September 2020, the Company formed a strategic partnership with Managex Funds Management Pty Ltd (Managex).
Under the terms of a binding sales agreement, Managex purchased The Agency Property Management WA Pty Ltd that
held the Group’s West Coast rent roll net assets, resulting in the following gain:
$
Consideration
Cash payment 2,777,164
Retention receivable 334,794
Total consideration 3,111,958
Less:
Costs associated with sale (51,292)
Net assets disposed (2,937,441)
Profit on sale of net assets disposed 123,225
1.3 Accounting policies
1.3.1 Revenue from contracts with customers
Revenue is measured based on the consideration specified in a contract with a customer. The Group recognises revenue
when performance obligations have been met.
Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of
returns, trade allowances and amounts collected on behalf of third parties.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 1 Revenue and other income (cont.)
1.3.2 Revenue is recognised for major business activities based on the following performance obligations:
a. Settlement fee income: on settlement of real estate transaction.
b. Upfront commissions for mortgage origination: on approval of finance to clients and settlement of real estate
transaction.
c. Trail commissions: on receipt, based on maintaining clientele.
d. Real estate commissions: upon settlement and/or sale of property is unconditional.
e. Training seminars and functions: on date function is held.
All revenue is stated net of the amounts of goods and services tax (GST).
1.3.3 Interest income
Interest revenue is recognised in accordance with note 3.1 Finance income and expenses.
1.3.4 Government Grants
Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will be
received, and the Group will comply with all attached conditions.
a. The Group received government grants from the Australian Government's JobKeeper Payment and Cash Flow Boost
schemes. There are no unfulfilled conditions or other contingencies attaching to these grants. Grants related to
income are presented as part of profit or loss as a deduction in reporting the related expense (refer note 2.3).
1.3.5 Critical judgements – Recognition of trailing commission revenue & trailing commission expense
The Group receives trailing commissions from lenders on loans they have settled that were originated by the Group. The
trailing commissions are received over the life of the loans based on the individual loan balance outstanding. The Group also
makes trailing commission payments to brokers based on the individual loan balance outstanding.).
As disclosed in note 1.3.2c above, revenue from trailing commission on receipt. The Directors considered the detailed criteria
for the recognition of revenue from the rendering of services set out in AASB 15 Revenue from contracts with customers, in
particular, whether the recognition of revenue on the trail satisfied the probability requirements. The Directors determined
that at the contract level, the Group cannot reliably determine the likelihood of that individual remaining with the Group or
the period that they will continue for, resulting in revenue only being recognised upon receipt.
Trailing commission expenditure is recognised on the same basis as trailing commission revenue and is recognised upon
receipt of trailing commission revenue.
Note 2 Loss before income tax Note 2021 2020
$ $
The following significant revenue and expense items are relevant in explaining the
financial performance:
2.1 Embedded derivative non-cash financing costs:
◼ Embedded Derivative - Finance cost 256,796 -
◼ Embedded Derivative - Fair value adjustment 5.7.1a 1,986,988 -
2,243,784 -
2.2 Impairment:
◼ Doubtful debts expense / (recovered) 5.4.1 400,000 (74,050)
◼ Impairment of goodwill and other intangibles 6.3.5a - 5,304,380
400,000 5,230,330
2.2.1 Accounting policy
a. Impairment of financial assets
Refer to note 5.8.1d
b. Impairment of non-financial assets
Refer to note 6.5.1
P a g e | 29
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 2 Loss before income tax (cont.)
2.3 Salaries and employment costs Note 2021 2020
$ $
◼ Commissions 31,656,030 19,558,045
◼ Director fees 144,000 535,980
◼ Salary and wages 7,899,320 8,475,768
◼ Superannuation 2,146,579 1,369,231
◼ Other employment related costs 3,746,379 2,210,996
◼ Government grants received in connection with employment costs 1.3.4a (1,410,000) (1,080,000)
44,182,308 31,070,020
2.3.1 Accounting policy
a. Short-term benefits
Liabilities for employee benefits for wages, salaries and annual leave that are expected to be settled within 12 months
of the reporting date represent present obligations resulting from employees' services provided to the reporting date
and are calculated at undiscounted amounts based on remuneration wage and salary rates that the Group expects to
pay at the reporting date including related on-costs, such as workers compensation insurance and payroll tax.
Non-accumulating non-monetary benefits, such as medical care, housing, cars and free or subsidised goods and services,
are expensed based on the net marginal cost to the Group as the benefits are taken by the employees.
b. Other long-term benefits
The Group's obligation in respect of long-term employee benefits other than defined benefit plans, such as long service
leave, is the amount of future benefit that employees have earned in return for their service in the current and prior
periods plus related on-costs; that benefit is discounted to determine its present value, and the fair value of any related
assets is deducted. The discount rate is the Reserve Bank of Australia's cash rate at the report date that have maturity
dates approximating the terms of the Company's obligations. Any actuarial gains or losses are recognised in profit or
loss in the period in which they arise.
c. Retirement benefit obligations: Defined contribution superannuation funds
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions onto a
separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to
defined contribution superannuation funds are recognised as an expense in the income statement as incurred.
d. Termination benefits
When applicable, the Group recognises a liability and expense for termination benefits at the earlier of: (a) the date
when the Group can no longer withdraw the offer for termination benefits; and (b) when the Group recognises costs for
restructuring pursuant to AASB 137 Provisions, Contingent Liabilities and Contingent Assets and the costs include
termination benefits. In either case, unless the number of employees affected is known, the obligation for termination
benefits is measured based on the number of employees expected to be affected. Termination benefits that are
expected to be settled wholly before 12 months after the annual reporting period in which the benefits are recognised
are measured at the (undiscounted) amounts expected to be paid. All other termination benefits are accounted for on
the same basis as other long-term employee benefits.
e. Equity-settled compensation
The fair value of options granted is recognised as an employee expense with a corresponding increase in equity. The fair
value is measured at grant date and spread over the period during which the employees become unconditionally entitled
to the options. The fair value of the options granted is measured using the Black-Scholes pricing model, considering the
terms and conditions upon which the options were granted. The amount recognised is adjusted to reflect the actual
number of share options that vest except where forfeiture is only due to market conditions not being met.
P a g e | 30
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 3 Other Significant Accounting Policies related to items of profit and loss
3.1 Finance income and expenses
Finance income comprises interest income on funds invested (including available-for-sale financial assets), gains on the
disposal of available-for-sale financial assets and changes in the fair value of financial assets at fair value through profit
or loss. Interest revenue is recognised on a time proportionate basis that considers the effective yield on the financial
asset.
Financial expenses comprise interest expense on borrowings calculated using the effective interest method, unwinding
of discounts on provisions, changes in the fair value of financial assets at fair value through profit or loss and impairment
losses recognised on financial assets. All borrowing costs are recognised in profit or loss using the effective interest
method.
Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a
substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such time
as the assets are substantially ready for their intended use or sale. All other borrowing costs are recognised in income in
the period in which they are incurred.
Foreign currency gains and losses are reported on a net basis.
Note 4 Income tax Note 2021 2020
$ $
4.1 Income tax benefit
Current tax - -
Deferred tax (1,894,024) (1,291,720)
(1,894,024) (1,291,720)
Deferred income tax expense included in income tax expense comprises:
◼ Increase in deferred tax assets 4.5 (1,242,778) (528,761)
◼ Decrease in deferred tax liabilities 4.6 (651,246) (888,324)
◼ Adjustment in respect to the adoption of AASB 16 Leases - 125,365
(1,894,024) (1,291,720)
4.2 Reconciliation of income tax expense to prima facie tax payable
The prima facie tax benefit on loss from ordinary activities before income
tax is reconciled to the income tax expense as follows:
Accounting loss before tax (3,750,479) (10,357,057)
Prima facie tax on operating loss at 30% (2020: 27.5%) (1,125,144) (2,848,191)
Add / (Less) tax effect of:
◼ Non-deductible expenses 796,046 423,656
◼ Non-assessable income and gains (16,072) -
◼ Recognition of deferred tax assets on revenue losses, not previously (1,802,428) -
recognised
◼ Other deductible expenses (38,465) -
◼ Impact of change in tax rate 4.3a 295,525 -
◼ Unrecognised income tax benefit in respect of current year losses (3,486) 1,132,815
and timing differences
Income tax benefit attributable to operating loss (1,894,024) (1,291,720)
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 4 Income tax (cont.) 2021 2020
% %
4.3 The applicable weighted average effective tax rates attributable to
operating profit are as follows: 50.50 12.47
a. The tax rates used in the above reconciliations is the corporate tax rate
of 30% payable by the Australian corporate entity on taxable profits
under Australian tax law. During the year the Company changed from
a tax rate of 27.5% to 30%.
4.4 Balance of franking account at year end of the parent nil nil
4.5 Deferred tax assets Note 2021 2020
$ $
Employee benefits 558,583 465,221
Accrued expenses 1,747,300 918,680
Provisions 177,161 52,397
AASB 16 Leases - Lease Liability 182,453 154,253
Other 309,093 141,261
2,974,590 1,731,812
Set-off deferred tax liabilities 4.6 (2,974,590) (1,731,812)
Net deferred tax assets - -
4.6 Deferred tax liabilities
Intangible Asset - Rent Roll 4,331,340 4,875,336
Accrued income - 107,250
4,331,340 4,982,586
Set-off deferred tax assets 4.5 (2,974,590) (1,731,812)
Net deferred tax liabilities 1,356,750 3,250,774
4.7 Tax losses and deductible temporary differences
Unused tax losses and deductible temporary differences for which no deferred
tax asset has been recognised, that may be utilised to offset tax liabilities:
◼ Revenue losses attributable to Australia 5,063,541 6,865,969
5,063,541 6,865,969
4.8 Potential deferred tax assets attributable to tax losses have not been brought to account at 30 June 2021 because the
Directors do not believe it is appropriate to regard realisation of the deferred tax assets as probable at this point in time.
These benefits will only be obtained if:
i. the Group derives future assessable income of a nature and of an amount sufficient to enable the benefit from the
deductions for the loss to be realised;
ii. the Company continues to comply with conditions for deductibility imposed by law; and
iii. no changes in tax legislation adversely affect the Group in realising the benefit from the deductions for the loss.
Balances disclosed in the financial statements and the notes thereto, related to taxation, are based on the best estimates
of the Directors. These estimates consider both the financial performance and position of the Company as they pertain
to current income taxation legislation, and the Directors understanding thereof. No adjustment has been made for
pending or future taxation legislation. The current income tax position represents that Directors' best estimate, pending
an assessment by tax authorities in relevant jurisdictions.
The parent company has accumulated tax losses of $16,878,470 (2020: $22,886,563) which are expected to be available
indefinitely for offset against future taxable profits of the parent company in which the losses arose. The recoupment of
these losses is subject to assessment by the Australian Taxation Office.
P a g e | 32
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 4 Income tax (cont.) Note
4.9 Accounting policy
The income tax expense or benefit for the period is the tax payable on the current period's taxable income based on the
applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary difference and to unused tax losses.
The current income tax charge is calculated based on the Australian tax laws enacted or substantively enacted at the end of the
reporting period being where the Group and its associates operate and generate taxable income. Management periodically
evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation.
It establishes provisions where appropriate based on amounts expected to be paid to the tax authorities.
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from
or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or
substantively enacted by the balance date, in Australia.
Deferred income tax is provided on all temporary differences at the balance date between the tax bases of assets and liabilities
and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities (DTL) are recognised for all taxable temporary differences except:
◼ when the DTL arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business
combination and that, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
◼ when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint
ventures, and the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred income tax assets (DTA) are recognised for all deductible temporary differences, carry-forward of unused tax assets
and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences and the carry-forward of unused tax credits and unused tax losses can be utilised, except:
◼ when the DTA relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a
transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor
taxable profit or loss; or
◼ when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint
ventures, in which case a DTA is only recognised to the extent that it is probable that the temporary difference will reverse
in the foreseeable future and taxable profit will be available against which the temporary difference can be utilised.
The carrying amount of DTA is reviewed at each balance date and reduced to the extent that it is no longer probable that
sufficient taxable profit will be available to allow all or part of the DTA to be utilised.
Unrecognised DTA are reassessed at each balance date and are recognised to the extent that it has become probable that future
taxable profit will allow the deferred tax asset to be recovered. DTAs and DTLs are measured at the tax rates that are expected
to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted
or substantively enacted at the balance date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss. DTAs and DTLs are
offset only if a legally enforceable right exists to set off current tax assets against current tax liabilities and the DTAs and DTLs
relate to the same taxable entity and the same taxation authority.
4.9.1 Tax consolidation
The Agency Group Australia Ltd and its wholly-owned Australian subsidiaries have formed an income tax consolidated group
(the Tax Group) under the tax consolidation legislation. Each entity in the Tax Group recognises its own current and deferred
tax liabilities, except for any DTLs resulting from unused tax losses and tax credits, which are immediately assumed by the parent
entity. The Group notified the Australian Tax Office that it had formed a Tax Group to apply from 1 July 2019. The Tax Group
has entered a tax sharing agreement whereby each company in the Tax Group contributes to the income tax payable in
proportion to their contribution to the net profit before tax of the Tax Group.
P a g e | 33
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 5 Financial assets and financial liabilities
5.1 Cash and cash equivalents 2021 2020
$ $
Cash at bank 5,096,435 2,724,142
5,096,435 2,724,142
5.1.1 The Group's exposure to interest rate risk and a sensitivity analysis for financial assets and liabilities are disclosed in note
8 Financial risk management.
2021 2020
5.1.2 Cash Flow Information $ $
a. Reconciliation of cash flow from operations to loss after income tax
Loss after income tax (1,856,455) (9,065,337)
Cash flows excluded from loss attributable to operating activities - -
Non-cash flows in loss from ordinary activities:
◼ Depreciation and amortisation 5,465,814 6,038,609
◼ Impairment 400,000 5,230,330
◼ Income tax benefit (1,894,024) (1,291,720)
◼ Non-cash interest adjustments 541,593 366,326
◼ Embedded derivative non-cash financing costs 2,243,784 -
◼ Share-based payments expense 215,946 -
Changes in assets and liabilities, net of the effects of purchase and
disposal of subsidiaries:
◼ (Increase)/decrease in receivables (2,785,148) (609,334)
◼ Decrease/(increase) in financial assets 1,157,528 371,999
◼ (Decrease) in trade and other payables 932,589 (1,616,823)
◼ Increase/(decrease) in provisions 221,762 910,654
Cash flow (used in) from operations - 4,643,389 334,704
- -
b. Reconciliation of liabilities arising from financing activities
Non-cash changes
Other Changes due
2019 Cash flows Changes(i) to AASB 16 2020
$ $ $ $ $
Short-term borrowings 21,126,603 (2,731,516) (4,551,852) - 13,843,235
Leases - (2,064,552) 473,581 7,465,948 5,874,977
Total liabilities from
financing activities 21,126,603 (4,796,068) (4,078,271) 7,465,948 19,718,212
-
(i)
Other changes include non-cash movements including conversion to shares as described in 5.1.2d below and 7.1.3, interest paid (classified
under operating activities), and restricted cash in connection with a convertible note as per 5.7.1b.
P a g e | 34
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 5 Financial assets and financial liabilities (cont.)
5.1 Cash and cash equivalents (cont.)
5.1.2 Cash Flow Information (cont.)
Non-cash changes
Other Embedded Converted
2020 Cash flows Additions Changes Derivative to equity 2021
$ $ $ $ $ $ $
Short-term borrowings 13,843,235 (7,843,235) - (6,000,000) - -
Long-term borrowings - 5,000,000 - 6,000,000 2,495,440 (3,612,768) 9,882,672
and financial liabilities
Leases 5,874,977 (1,915,689) 1,694,851 191,031 - - 5,845,170
Total liabilities from
financing activities 19,718,212 (4,758,924) 1,694,851 191,031 2,495,440 (3,612,768) 15,727,842
- -
c. Credit and loan standby arrangement with banks
Refer note 5.6.4 Financing facilities available.
d. Non-cash investing and financing activities
2021
During the year non-cash investing and financing activities consisted of:
◼ Issue of 115,621,485 shares upon the conversion of $3,612,768 of convertible notes as described in notes 5.7.1a
and 7.1.1.
◼ Reclassification of borrowings to non-current upon renegotiation of terms with Macquarie Bank Limited.
◼ The recognition of an embedded derivative in connection with convertible notes as described in notes 5.7.1a
consisting of interest of $623,557, fair value adjustments of $1,986,988, and transaction costs of ($115,105).
2020
During the prior year, non-cash investing and financing activities consisted of, and as detailed in in note 7.1.3:
◼ 89,889,649 shares and 44,944,639 options were issued to settle $5,798,388 in loans.
◼ 714,286 options were issue as a debt facilitation fee with a fair value of $14,297.
◼ 12,899,074 options with a fair value of $258,192 were issued in consideration for capital raising services.
5.1.3 Accounting policy
For Statement of Cash Flow presentation purposes, cash and cash equivalents includes cash on hand, deposits held at call
with financial institutions, other short-term, highly liquid instruments with original maturities 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, and bank
overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the Statement of Financial Position.
P a g e | 35
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 5 Financial assets and financial liabilities (cont.)
5.2 Trade and other receivables 2021 2020
$ $
5.2.1 Current
Trade debtors 6,672,604 3,677,980
Recoverable commissions / wages 1,125,019 876,861
Other receivables 855,780 386,083
Provision for non-recovery of trade debtor and commissions / wages (300,000) (339,702)
8,353,403 4,601,222
5.2.2 Non-current
Trade debtors 163,010 269,655
163,010 269,655
5.2.3 The Group's exposure to credit rate risk is disclosed in note 8 Financial risk management.
5.2.4 The average credit period on rendering of services ranges from current to 30 days. Interest is not charged.
No allowance has been made for estimated irrecoverable trade receivable amounts arising from past sale of goods and
rendering of services, determined by reference to past default experience. Amounts are considered as ‘past due’ when the
debt has not been settled, within the terms and conditions agreed between the Group and the customer or counter party to
the transaction.
5.2.5 Accounting policy
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost, less provision for
doubtful debts. Trade receivables are due for settlement within no more than 30 days. Marketing allowances and upfront
commissions paid to employees and agents are recovered against future sales commissions received by the employee or
agent.
a. Determining the stage for impairment
At each reporting date, the Group assesses whether there has been a significant increase in credit risk for exposures
since initial recognition by comparing the risk of default occurring over the remaining expected life from the reporting
date and the date of initial recognition. The Group considers reasonable and supportable information that is relevant
and available without undue cost or effort for this purpose. This includes quantitative and qualitative information
and also, forward-looking analysis.
An exposure will migrate through the ECL stages as asset quality deteriorates. If, in a subsequent period, asset quality
improves and also reverses any previously assessed significant increase in credit risk since origination, then the
provision for doubtful debts reverts from lifetime ECL to 12-months ECL. Exposures that have not deteriorated
significantly since origination are considered to have a low credit risk. The provision for doubtful debts for these
financial assets is based on a 12-months ECL. When an asset is uncollectible, it is written off against the related
provision. Such assets are written off after all the necessary procedures have been completed and the amount of the
loss has been determined. Subsequent recoveries of amounts previously written off reduce the amount of the
expense in the consolidated Statement of Profit or Loss and Other comprehensive Income.
The Group assesses whether the credit risk on an exposure has increased significantly on an individual or collective
basis. For the purposes of a collective evaluation of impairment, financial instruments are accompanied on the basis
of shared credit risk characteristics, taking into account instrument type, credit risk ratings, date of initial recognition,
remaining term to maturity, industry, geographical location of the borrower and other relevant factors
P a g e | 36
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 5 Financial assets and financial liabilities (cont.)
5.3 Financial assets 2021 2020
$ $
5.3.1 Current
Restricted cash - 600,000
Working capital – trust account - 1,000,000
- 1,600,000
5.3.2 Non-current
Bank guarantees and restricted cash 612,860 170,388
612,860 170,388
5.4 Other assets Note 2021 2020
$ $
5.4.1 Current
Prepayments 305,748 7,636
Other deposits 5.4.2 417,690 542,840
Less: provision for impairment 5.4.3 (400,000) -
323,438 550,476
5.4.2 Other deposits at 30 June 2021 relate to an advance payment of $400,000 made to the Federal Court regarding the
Magnolia case and other deposits of $17,690 (2020: bank guarantees comprising of $481,716 and rental deposits of
$61,124)
5.4.3 The provision for impairment of $400,000 relates to the deposit placed with the Federal court regarding the unresolved
Magnolia case. As the courts final decision in this matter is still unknown, the Directors deemed it prudent to provide for
an impairment in full.
5.5 Trade and other payables 2021 2020
$ $
5.5.1 Current
Trade payables 2,552,376 2,483,388
Employees’ remuneration – commissions payable 3,706,455 1,869,045
Payroll tax 353,739 1,152,496
Superannuation – employees 392,778 401,358
Sundry creditors and accrued expenses 2,512,237 843,601
GST and PAYG payable 1,676,537 2,916,649
Other - 106,614
11,194,122 9,773,151
5.5.2 Trade payables are unsecured, non-interest bearing and are normally settled on 30-day terms. Other payables are
unsecured non-trade payables, are non-interest bearing and have an average term of 1 month.
5.5.3 Accounting policy
a. Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year which
are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are
presented as current liabilities unless payment is not due within 12 months.
P a g e | 37
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 5 Financial assets and financial liabilities (cont.)
5.6 Borrowings Note 2021 2020
$ $
5.6.1 Current
Loans 5.6.2a - 750,000
Bank loans 5.6.2b - 12,093,235
Convertible note - restricted cash facility - 1,000,000
- 13,843,235
5.6.2 Non-current
Bank loans 5.6.2b 5,000,000 -
5,000,000 -
a. Loan payable to Kalonda Pty Ltd rolled over to 31 December 2020 with an interest rate of 16% and was repaid in full
on 4 January 2021
b. On 6 January 2021 the Company executed an amendment deed to its loan agreement with Macquarie Bank Limited
(Macquarie). Pursuant to the terms of the amendment deed, the revised terms of the loan include:
◼ Loan amount $5,000,000
◼ Interest rate Base Rate (BBSW) + margin of 8.5% which was reduced to 4.75% from 1 April 2021.
The Base Rate (determined monthly) has ranged between 0.01% to 0.0917% during the period
◼ Repayment date On or before 4 January 2023
◼ Covenants The Company has covenanted to Macquarie that it will:
maintain a loan to value ratio (LVR) based on the value of the Company’s property
management book (on agreed multiples applied by Macquarie) as a percentage to the
Company’s secured debt position.
provide monthly reporting to Macquarie in accordance with the Loan Agreement.
provide a compliance certificate to Macquarie each month confirming that the Company has
complied with the covenants above and no event of default exists in relation to the Company
◼ Termination/Default It is an event of default under the loan agreement if the total number of sales agents employed
by the Company’s wholly owned subsidiary, Top Level Real Estate Pty Ltd, is less than, or
falls to less than 59. The Loan Agreement otherwise contains default and termination
provisions considered standard for a bank facility of this nature.
On 4 August 2021, the Company advised that it has executed an amendment deed to its loan agreement with Macquarie
Bank Limited. The revised terms of the loan are detailed in note 13.1.
5.6.3 Assets pledged as security
As disclosed in note 5.7.1b, security is held over all the Group companies.
5.6.4 Financing facilities available
At balance date, the following Total facilities Facilities used Facilities unused
financing facilities had been
2021 2020 2021 2020 2021 2020
negotiated and were available:
$ $ $ $ $ $
Bank and other loans 5,000,000 13,843,235 (5,000,000) (13,843,235) - -
Leases (see note 6.2.2) - - - - - -
Total facilities at balance date 5,000,000 13,843,235 (5,000,000) (13,843,235) - -
P a g e | 38
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 5 Financial assets and financial liabilities (cont.)
5.6 Borrowings (cont.)
5.6.5 Accounting policy
a. Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently
measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption
amount is recognised in profit or loss over the period of the borrowings using the effective interest method. Fees paid
on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable
that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the
extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as
a prepayment for liquidity services and amortised over the period of the facility to which it relates.
Borrowings are removed from the statement of financial position when the obligation specified in the contract is
discharged, cancelled, or expired. The difference between the carrying amount of a financial liability that has been
extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or
liabilities assumed, is recognised in profit or loss as other income or finance costs. Borrowings are classified as current
liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the
reporting period.
5.7 Financial liabilities 2021 2020
$ $
5.7.1 Non-current
Convertible note: 5.7.1a,b
◼ Debt component 895,101 -
◼ Derivative financial liability conversion option 3,987,571 -
4,882,672 -
a. Reconciliation of convertible notes
Opening balance – from Borrowings 5.6.1 1,000,000 -
Proceeds on issue of convertible notes 5,000,000 -
6,000,000 -
◼ Fair value of derivative liabilities 4,988,334 -
◼ Host debt liability 896,561 -
◼ Convertible loan notes converted to equity (3,612,768) -
◼ Interest charged 623,557 -
◼ Fair value movement 1,986,988 -
Carrying value of liabilities at reporting date 4,882,672 -
P a g e | 39
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 5 Financial assets and financial liabilities (cont.)
5.7 Financial liabilities (cont.)
b. On 5 January 2021, following shareholder approval at the Company’s AGM held 4 January 2021, the Company issued
5,000,000 convertible notes to Peters Investments Pty Ltd in order to raise $5,000,000. In addition, the terms of the
1,000,000 convertible notes issued to Peters Investments in May 2020 were amended to be consistent with the terms
of the 5,000,000 convertible notes issued 4 January 2021:
◼ Interest rate higher of 8% per annum and the interest rate on the Macquarie Bank loan
◼ Facilitation fee 3% fee equalling $150,000 which is capitalised and added to the face value of the note.
◼ Security Second security ranking behind Macquarie Bank.
◼ Options 12,000,000 Options exercisable at the $0.027 on or before 31 March 2023. These options were
exercised on 28 January 2021.
◼ Term/Maturity Date Unless converted to shares the notes will be repaid in cash on the earlier of 31 March 2023 or
when all amounts owing by the Company to Macquarie Bank have been repaid.
◼ Conversion At Noteholders election the notes can be converted into shares in The Agency at the lower of
$0.027 per share and the issue price of shares offered under any subsequent capital raising
completed by the Company to raise over $1,000,000 on or before maturity date.
◼ Other Conditions Noteholder will have the first right of refusal to replace the Macquarie Bank loan on commercial
terms and conditions to be reasonably agreed between the Noteholder and The Agency.
On 28 January 2021, Peter Investments converted $3,612,768 of debt and interest into 115,621,485 shares.
5.7.2 Accounting policies and Critical Estimates - Convertible notes
a. Debt component
The conversion feature of convertible notes (notes) is required to be separated from the notes and is accounted for
separately as a derivative financial liability. As a result, the notes are initially recognised at a discounted amount. The
discount is amortised as interest expense using the effective interest method over the terms of the notes.
b. Embedded derivative – Conversion feature
The conversion feature in the notes represents the embedded derivative financial instrument in the host debt contract.
The conversion feature represents the Group’s obligation to issue Company shares at a fixed price should noteholders
exercise their conversion option.
The embedded derivatives are carried in the Statement of Financial Position at their estimated fair value taking market
participant assumptions into consideration, with any changes in fair value recognised in the Statement of Profit or Loss
and Other Comprehensive Income.
These values were calculated using the Black-Scholes option pricing model, applying the following inputs:
Grant Date Balance Date
Face Value: $5,150,000 $3,354,032
Grant date share price: $0.035 $0.050
Conversion price: $0.027 $0.027
Expiry date 31 March 2023 31 March 2023
Expected share price volatility: 100.00 100.00
Risk-free interest rate: 0.19% 0.06%
Value per conversion right $0.0219 $0.0321
c. Settlement of Convertible Notes
Where notes are settled by issue of shares, the related financial liabilities are derecognised at their carrying value with
the corresponding increase to share capital. Any costs incurred are recognised in profit or loss.
Where notes are settled by payment of cash, the related financial liabilities are derecognised at their carrying value and
the difference between total cash consideration paid and the carrying value of the financial liabilities derecognised is
recognised in profit or loss.
P a g e | 40
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 5 Financial assets and financial liabilities (cont.)
5.7 Financial liabilities (cont.)
d. Capitalised transaction costs
The Company incurred transaction costs upon the issuance of the notes. Transaction costs relating to the notes have
been allocated between the debt component and the conversion derivatives using the relating proportions of these on
initial measurement of the instruments. Costs attributed to the debt component are amortised to finance expense over
the term of the notes using the effective interest method. Costs allocated to the conversion derivatives are immediately
recognised in the Statement of Profit or Loss and Other Comprehensive Income.
5.8 Other Significant Accounting Policies related to Financial Assets and Liabilities
5.8.1 Investments and other financial assets
a. Classification
The Group classifies its financial assets in the following measurement categories:
◼ those to be measured subsequently at fair value (either through OCI or through profit or loss), and
◼ those to be measured at amortised cost.
The classification depends on the entity’s business model for managing the financial assets and the contractual terms
of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For investments in
equity instruments that are not held for trading, this will depend on whether the group has made an irrevocable
election at the time of initial recognition to account for the equity investment at fair value through other
comprehensive income (FVOCI).
The Group reclassifies debt investments when and only when its business model for managing those assets changes.
b. Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade-date, the date on which the Group
commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from
the financial assets have expired or have been transferred and the Group has transferred substantially all the risks
and rewards of ownership.
c. Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at
fair value through profit or loss (FVPL), transaction costs that are directly attributable to the acquisition of the
financial asset. Transaction costs of financial assets carried at FVPL are expensed in profit or loss. Financial assets
with embedded derivatives are considered in their entirety when determining whether their cash flows are solely
payment of principal and interest.
i. Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset
and the cash flow characteristics of the asset. There are three measurement categories into which the Group
classifies its debt instruments:
◼ Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are measured at amortised cost. Interest income from these
financial assets is included in finance income using the effective interest rate method. Any gain or loss arising
on derecognition is recognised directly in profit or loss and presented in other gains/(losses). Impairment
losses are presented as separate line item in the statement of profit or loss.
◼ FVOCI: Assets held for collection of contractual cash flows and for selling the financial assets, where the
assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements
in carrying amounts are taken through OCI, except for the recognition of impairment gains or losses, interest
income and foreign exchange gains and losses which are recognised in profit or loss. When a financial asset
is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit
or loss and recognised in other gains/(losses). Interest income from these financial assets is included in
finance income using the effective interest rate method. Foreign exchange gains and losses are presented in
other gains/(losses) and impairment expenses are presented separately in the statement of profit or loss.
◼ FVPL: Assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL. A gain or loss
on a debt investment that is subsequently measured at FVPL is recognised in profit or loss and presented net
within other gains/(losses) in the period in which it arises.
P a g e | 41
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 5 Financial assets and financial liabilities (cont.)
5.8 Other Significant Accounting Policies related to Financial Assets and Liabilities (cont.)
ii. Equity instruments
The Group subsequently measures all equity investments at fair value. Where the group’s management has
elected to present fair value gains and losses on equity investments in OCI, there is no subsequent reclassification
of fair value gains and losses to profit or loss following the derecognition of the investment. Dividends from such
investments continue to be recognised in profit or loss as other income when the group’s right to receive
payments is established.
Changes in the fair value of financial assets at FVPL are recognised in other gains/(losses) in the statement of
profit or loss as applicable. Impairment losses (and reversal of impairment losses) on equity investments
measured at FVOCI are not reported separately from other changes in fair value.
d. Impairment
The Group assesses on a forward-looking basis, the expected credit losses associated with its debt instruments
carried at amortised cost and FVOCI. The impairment methodology applied depends on whether there has been a
significant increase in credit risk.
For trade receivables, the Group applies the simplified approach permitted by AASB 9, which requires expected
lifetime losses to be recognised from initial recognition of the receivables.
Note 6 Non-financial assets and financial liabilities
6.1 Property, plant, and equipment 2021 2020
$ $
Plant and equipment – at cost 1,253,362 1,187,451
Accumulated depreciation (725,387) (614,867)
527,975 572,584
Leasehold improvements – at cost 3,447,970 3,407,145
Accumulated amortisation (2,398,286) (1,939,915)
1,049,684 1,467,230
Total plant and equipment 1,577,659 2,039,814
Plant and Leasehold
Equipment improvements Total
6.1.1 Movements in Carrying Amounts 5 $ $ $
Carrying amount at 1 July 2019 682,977 1,894,573 2,577,550
Additions 54,028 228,499 282,527
Disposals / write-offs - (116,231) (116,231)
Depreciation expense (164,421) (539,611) (704,032)
Carrying amount at 30 June 2020 572,584 1,467,230 2,039,814
- - -
Carrying amount at 1 July 2020 572,584 1,467,230 2,039,814
Additions 96,070 40,824 136,894
Disposals / write-offs (3,937) - (3,937)
Depreciation expense (136,742) (458,370) (595,112)
Carrying amount at 30 June 2021 527,975 1,049,684 1,577,659
- - -
P a g e | 42
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 6 Non-financial assets and financial liabilities (cont.)
6.1 Property, plant, and equipment (cont.)
6.1.2 Accounting policy
a. Recognition and measurement
Items of plant and equipment are measured on the cost basis and carried at cost less accumulated depreciation (see
below) and impairment losses (see accounting policy 6.5.1 Impairment of non-financial assets).
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets
includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a working
condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they
are located, and an appropriate proportion of production overheads. Cost includes the cost of replacing parts that are
eligible for capitalisation when the cost of replacing the parts is incurred. Similarly, when each major inspection is
performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement only if it is eligible
for capitalisation.
Where considered material, the carrying amount of property, plant, and equipment is reviewed annually by Directors
to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the
basis of the expected net cash flows that will be received from the asset’s employment and subsequent disposal. The
expected net cash flows have not been discounted to their present values in determining recoverable amounts.
Where parts of an item of property, plant, and equipment have different useful lives, they are accounted for as separate
items of plant and equipment.
b. Subsequent costs
The cost of replacing part of an item of 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. Any costs of the day-to-day servicing of plant and equipment are recognised in the income statement as an
expense as incurred.
c. Depreciation
The depreciable amount of all fixed assets including building and capitalised lease assets, but excluding freehold land, is
depreciated on either a straight-line basis or diminishing balance basis, whichever is considered most appropriate, over
their useful lives to the Group commencing from the time the asset is held ready for use. Leasehold improvements are
amortised over the remaining term of the lease.
Depreciation rates and methods are reviewed annually for appropriateness. The depreciation rates used for the current
and comparative period are:
2021 2020
% %
◼ Leasehold Improvements Over term of lease Over term of lease
◼ Plant and equipment:
Office furniture and fittings 10 10
Office equipment 25 25
Motor vehicle 25 25
The carrying amount of plant and equipment is reviewed annually by Directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected
net cash flows which will be received from the assets’ employment and subsequent disposal. The expected net cash
flows have not been discounted to their present values in determining recoverable amounts.
d. Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits
are expected from its use or disposal. The gain or loss on disposal of an item of property, plant and equipment is
determined by comparing the proceeds from disposal with the carrying amount of the property, plant and equipment
and is recognised net within other income/other expenses in profit or loss. When revalued assets are sold, any related
amount included in the revaluation reserve is transferred to retained earnings.
P a g e | 43
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 6 Non-financial assets and financial liabilities (cont.)
6.2 Leases 2021 2020
$ $
6.2.1 Right of use assets
Properties 3,704,241 3,500,419
Printing equipment 1,190,129 1,144,901
4,894,370 4,645,320
6.2.2 Lease liabilities
Current 1,828,270 1,979,900
Non-current 4,016,900 3,895,077
5,845,170 5,874,977
6.2.3 Additions to the right-of-use assets during the 2021 financial year were $3,125,759 (2020: $6,335,866).
2021 2020
6.2.4 Amounts recognised in the statement of profit or loss $ $
Depreciation charge of right-of-use assets:
◼ Properties 1,243,883 1,396,230
◼ Printing equipment 279,305 293,084
1,523,188 1,689,314
Interest expense (included in finance cost) 217,937 325,014
6.2.5 The total cash outflow for leases for the 2021 financial year was $1,915,689 (2020: $2,064,552).
6.2.6 Accounting policy
a. Recognition and measurement
Until the 2019 financial year, leases of property, plant and equipment were classified as either finance leases or
operating leases. From 1 July 2019, leases are recognised as a right-of-use asset and a corresponding liability at the date
at which the leased asset is available for use by the Group.
i. Right of Use Asset
The Group recognises a right of use asset at the commencement date of the lease. The right of use asset is initially
measured at cost. The cost of right of use assets includes the amount of lease liabilities recognised, adjusted for any
lease payments made at or before the commencement date, plus initial direct costs incurred and an estimate of
costs to dismantle, remove or restore the leased asset, less any lease incentives received.
Right-of-use assets are measured at cost comprising the following:
◼ the amount of the initial measurement of lease liability
◼ any lease payments made at or before the commencement date less any lease incentives received
◼ any initial direct costs, and
◼ restoration costs.
Subsequent to initial measurement, the right of use asset is depreciated on a straight-line basis over the shorter of
the lease term and the estimated useful life as follows:
◼ Properties 17 – 64 months
◼ Printing equipment 60 months
Right of use assets are subject to impairment and are adjusted for any remeasurement of lease liabilities.
P a g e | 44
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 6 Non-financial assets and financial liabilities (cont.)
6.2 Leases (cont.)
ii. Lease liabilities
At the commencement date of the lease, the Group recognises lease liabilities at the present value of lease payment
to be made over the lease term. The lease payments include fixed payments (including in substance fixed payments)
less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts
expected to be paid under residual value guarantees. The lease payments also include the exercise price of a
purchase option reasonably certain to be exercised by the Group and payments of penalties for terminating a lease,
if the assessment of lease term reflects the Group exercising the option to terminate. The variable lease payments
that do not depend on an index or a rate are recognised as expense in the period on which the event or condition
that triggers the payments occurs. The present value of lease payments is discounted using the interest rate implicit
in the lease or, if the rate cannot be readily determined, the Group's incremental borrowing rate.
The lease liability is measured at amortised cost using the effective interest method. After the commencement date,
the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments
made.
The amount of lease liability is remeasured when there is a change in future lease payments arising from a change
in an index or rate, if there is a change in the Group's estimate of the amount expected to be payable under a residual
value guarantee, or if the Group changes its assessment of whether it will exercise a purchase, extension, or
termination option. When the lease liability is remeasured, a corresponding adjustment is made to the carrying
amount of the right of use asset, or is recognised in profit or loss if the carrying amount of the right of use asset has
been reduced to zero.
The Group has elected not to recognise right of use assets and lease liabilities for short term leases that have a lease
term of 12 months or less and do not contain a purchase option, and leases of low value assets. The Group recognises
the lease payments associated with these leases as an expense on a straight-line basis over the lease term.
b. Extension and termination options
Extension options are included in the property leases of the Group.
6.2.7 Critical judgements in determining the lease term
In determining the lease term, management considers all facts and circumstances that create an economic incentive to
exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options)
are only included in the lease term if the lease is reasonably certain to be extended (or not terminated).
For leases of properties and printing equipment, the following factors are normally the most relevant:
◼ If there are significant penalties to terminate (or not extend), the Group is typically reasonably certain to extend (or
not terminate).
◼ If any leasehold improvements are expected to have a significant remaining value, the Group is typically reasonably
certain to extend (or not terminate).
◼ Otherwise, the Group considers other factors including historical lease durations and the costs and business
disruption required to replace the leased asset.
The lease term is reassessed if an option is actually exercised (or not exercised) or the Group becomes obliged to exercise
(or not exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in
circumstances occurs, which affects this assessment, and that is within the control of the lessee.
P a g e | 45
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 6 Non-financial assets and financial liabilities (cont.)
6.3 Intangible assets Note 2021 2020
$ $
Goodwill 10,704,236 17,077,617
Impairment charge 6.3.3 - (5,304,380)
10,704,236 11,773,237
Rent Roll and trail book 6.3.5a 21,134,545 24,348,146
Accumulated amortisation (7,851,603) (5,930,600)
13,282,942 18,417,546
Trademarks 268,420 268,420
Accumulated amortisation and impairment (268,420) (268,420)
- -
Others 291,875 381,968
Accumulated amortisation and impairment (38,602) (196,396)
253,273 185,572
Total intangibles 24,240,451 30,376,355
6.3.1 As disclosed in note 1.2.1, the Company sold its West Coast rent roll business, resulting in the disposal of goodwill of
$1,069,001 and rent roll asset of $1,843,907.
6.3.2 Movements in Carrying Amounts Note Goodwill Rent Roll Other Total
$ $ $ $
Carrying amount at 1 July 2019 17,077,617 21,958,595 - 39,036,212
Additions - 102,482 187,304 289,786
Amortisation expense (5,304,380) - - (5,304,380)
Impairment 6.3.5a - (3,643,531) (1,732) (3,645,263)
Carrying amount at 30 June 2020 11,773,237 18,417,546 185,572 30,376,355
- - - -
Carrying amount at 1 July 2020 11,773,237 18,417,546 185,572 30,376,355
Additions - - 104,571 104,571
Disposals 1.2.1 (1,069,001) (1,843,907) - (2,912,908)
Amortisation expense - (3,290,697) (36,870) (3,327,567)
Carrying amount at 30 June 2021 10,704,236 13,282,942 253,273 24,240,451
- - - -
P a g e | 46
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 6 Non-financial assets and financial liabilities (cont.)
6.3 Intangible assets (cont.)
6.3.3 Allocation of goodwill to cash-generating units (CGU)
Goodwill has been allocated for impairment testing purposes to the CGU unit. Before recognition of impairment losses, the
carrying amount of goodwill (other than goodwill relating to discontinued operations) was allocated to CGU as follows.
2021 2020
$ $
◼ Top Level Real Estate - Residential sales 10,657,756 10,657,756
◼ Property Management - WA - 1,069,001
◼ Settlements 46,480 46,480
Carrying amount as at 30 June 10,704,236 11,773,237
- -
The recoverable amount of the Group’s Top Level Real Estate CGU has been determined based on a value in use calculation
which uses cash flow projections based on financial budgets approved by Directors utilising the following key assumptions:
◼ Revenue has been extrapolated at a growth rate of 5.00% from the 2-year budget, with nil% growth rate applied
from year 3;
◼ Discount rate is based upon a weighted average cost of capital of 15.5%;
◼ In the 2020, an impairment of $5,304,380 (2021: $nil).
The Directors believe that any reasonably possible further change in the key assumptions on which recoverable amount
is based would not cause Top Level Real Estate CGU carrying amount to exceed its recoverable amount.
6.3.4 Accounting policy
a. Intangible assets acquired separately
Intangible assets acquired separately are recorded at cost less accumulated amortisation and impairment. Amortisation
is charged on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation method is
reviewed at the end of each annual reporting period, with any changes in these accounting estimates being accounted
for on a prospective basis.
b. Intangible assets acquired in a business combination
Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair
value at the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life
intangible assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible
assets are subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit
or loss arising from derecognition of intangible assets are measured as the difference between net disposal proceeds
and the carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed
annually. Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the
amortisation method or period.
c. Trail Book intangible assets
Trail book contracts and licences have a finite useful life and are carried at cost less accumulated amortisation and
impairment losses. Amortisation is calculated using the straight-line method to allocate the cost of trail book and licences
over their estimated useful lives.
d. Property Management intangible assets
The property management rights are expected to have a finite life and are therefore amortised over their useful lives.
The investment is carried at cost less accumulated amortisation and impairment losses.
Amortisation is calculated using the straight-line method to allocate the cost of the rent roll over its estimated useful
lives which is based on comparable market evidence.
e. Business and domain names
Business and domain names are recognised at cost of acquisition. They have a finite useful life and are amortised on a
systematic basis based on the future economic benefits to be obtained over its useful life. Amortisation is calculated
using the straight-line method.
P a g e | 47
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 6 Non-financial assets and financial liabilities (cont.)
6.3 Intangible assets (cont.)
f. Subsequent measurement
The following useful lives are used in the calculation of amortisation:
2021 2020
% %
◼ Trail Book and Rent Roll intangible assets 15 15
◼ Property Management intangible assets 15 15
◼ Business and domain names 10 10
g. Goodwill
Goodwill arising on an acquisition of a business is carried at cost as established at the date of the acquisition of the
business (see note 11.1.1) less accumulated impairment losses, if any.
For the purposes of impairment testing, goodwill is allocated to each of the Group's cash-generating units (CGU) (or
groups of CGUs) that is expected to benefit from the synergies of the combination.
A CGU to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an
indication that the unit may be impaired. If the recoverable amount of the CGU is less than its carrying amount, the
impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the
other assets of the unit pro rata based on the carrying amount of each asset in the unit. Any impairment loss for goodwill
is recognised directly in profit or loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.
On disposal of the relevant CGU, the attributable amount of goodwill is included in the determination of the profit or
loss on disposal.
6.3.5 Key estimates and Critical Judgements– Impairment of intangibles
a. Impairment of goodwill and rent roll
Determining whether goodwill is impaired requires an estimation of the value in use of the cash generating units to
which goodwill has been allocated. The value in use calculation requires management to estimate the future cash flows
expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. Where
the actual future cash flows are less than expected, an impairment loss may arise.
Included within the Top Level CGU and Property Management CGU are rent roll assets of $13,140,150 (2020:
$16,267,497) and $nil (2020: $1,964,417) respectively. These same CGU's also included goodwill of $10,657,756 (2020:
$10,657,756) and $nil (2020: $1,069,001).
For the rent roll assets, the recoverable amounts of these CGU's are derived from market transactional evidence in
relation to their fair value. The Directors have determined that a multiple of 4 for the Top Level CGU (based on an
independent expert opinion) and 2.25 for the Property Management CGU (using subsequent sales transactions),
multiplied by the annual rent roll income is an appropriate measure of the fair value of the rent roll assets. Fair value
less cost to sell of these CGU's was classified on a level 2 basis. No impairment resulted.
Management performed a goodwill impairment test of the Top Level Real Estate Sales CGU (acquired in 2019) taking a
conservative approach in preparing its value in use calculation in light of market uncertainty resulting from COVID.
Management applied a discount rate of 15.5% resulting in no impairment loss for 2021 (2020: $5,304,380).
The Mortgage CGU was tested for impairment and the result far exceeded the carrying value. All value-in-use
calculations were performed using board approved budgets.
P a g e | 48
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 6 Non-financial assets and financial liabilities (cont.)
6.4 Provisions 2021 2020
$ $
6.4.1 Current
Employee entitlements 1,406,422 1,228,979
Future fund referrals 1,158,984 1,057,856
2,565,406 2,286,835
6.4.2 Non-current
Employee entitlements 62,742 61,377
Make good provisions 149,548 165,000
Future fund referrals 67,955 110,677
280,245 337,054
6.4.3 Movements in Carrying Amounts Employee Make good Future fund
entitlements provisions referrals Total
$ $ $ $
Carrying amount at 1 July 2020 - 1,290,356 165,000 1,168,533 2,623,889
Additions 592,128 - 250,118 842,246
Disposals (43,545) - - (43,545)
Amounts used during the year (369,775) (15,452) (191,712) (576,939)
Carrying amount at 30 June 2021 1,469,164 149,548 1,226,939 2,845,651
- - - -
6.4.4 Description of provisions
a. Provision for employee benefits represents amounts accrued for annual leave (AL) and long service leave (LSL). The
current portion for this provision includes the total amount accrued for AL entitlements and the amounts accrued for LSL
entitlements that have vested due to employees having completed the required period of service. The Group does not
expect the full amount of AL or LSL balances classified as current liabilities to be settled within the next 12 months.
However, these amounts must be classified as current liabilities since the Group does not have an unconditional right to
defer the settlement of these amounts in the event employees wish to use their leave entitlement.
b. Make good provision. The Company is required to restore the leased premises to their original condition at the end of
the respective lease terms. A make good provision has been recognised for the present value of the estimated
expenditure required to remove any leasehold improvements. The Directors valued the make good provision based upon
a third-party cost estimate provided to the Company.
c. Provision for Future fund referrals is an incentive scheme provided to property partners for successfully referring
property management and mortgage broking transactions. The referral fees are transferred into an asset growth model
which creates an interest for the future benefit of the Property Partner, maturing after two years, which also assists to
retain staff. The company estimates the value of the future fund referral provision using a probability weighting model
which is based on historic information.
6.4.5 Accounting policy
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation. Provisions are not recognised for future operating losses.
When the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating
to any provision is presented in the statement of comprehensive income net of any reimbursement.
P a g e | 49
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 6 Non-financial assets and financial liabilities (cont.)
6.4 Provisions (cont.)
Provisions are measured at the present value or management's best estimate of the expenditure required to settle the
present obligation at the end of the reporting period.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the
risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised
as an interest expense.
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion
of the entity, on or before the end of the reporting period but not distributed at the end of the reporting date
6.5 Other Significant Accounting Policies related to Non-Financial Assets and Liabilities
6.5.1 Impairment of non-financial assets
The carrying amounts of the Group's non-financial assets, other than deferred tax assets (see accounting policy at note 4.9)
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. Goodwill and intangible assets that have an indefinite useful life are not
subject to amortisation and are tested annually for impairment or more frequently if events or changes in circumstances
indicate that they might be impaired. Other assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its recoverable
amount. A cash-generating unit is the smallest identifiable asset group that generates cash flows that largely are
independent from other assets and groups. Impairment losses are recognised in the income statement, unless the asset has
previously been revalued, in which case the impairment loss is recognised as a reversal to the extent of that previous
revaluation with any excess recognised through the income statement. Impairment losses recognised in respect of cash-
generating units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce
the carrying amount of the other assets in the unit on a pro rata basis.
The recoverable amount of an asset or cash-generating unit is the greater of its fair value less costs to sell and value in use.
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 an asset that
does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to
which the asset belongs.
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 and amortisation, if no impairment loss had
been recognised.
P a g e | 50
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 7 Equity
7.1 Issued capital Note 2021 2020 2021 2020
No. No. $ $
Fully paid ordinary shares at no par value 428,575,916 298,954,431 43,635,166 39,395,942
2021 2020 2021 2020
7.1.1 Ordinary shares No. No. $ $
At the beginning of the year 298,954,431 103,810,047 39,395,942 27,765,049
Shares issued during the year:
◼ Issued for cash - 85,913,817 - 5,584,398
◼ Equity-settled payments 7.1.3,7.1.4 - 107,008,316 - 6,955,540
◼ Conversion of performance shares - 2,222,251 - -
◼ Convertible note conversion 5.7.1b 115,621,485 - 3,612,768 -
◼ Exercise of $0.027 options 12,000,000 - 546,000 -
◼ Exercise of $0.0338 options 2,000,000 - 140,456 -
Transaction costs relating to share issues - - (60,000) (909,045)
At reporting date 428,575,916 298,954,431 43,635,166 39,395,942
7.1.2 Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in
proportion to the number of and amounts paid on the shares held. On a show of hands every holder of ordinary shares
present at a meeting in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote.
Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
7.1.3 Equity-settled Payments (prior financial year)
As approved by shareholders at general meetings during the 12 months to 30 June 2020:
◼ 11,138,462 shares with a fair value of $0.065 per share totalling $724,000 were issued to third-party consultants in lieu of
cash for services performed.
◼ 5,782,551 shares with 2,891,275 attaching options were issued to Daring Investments Pty Ltd a company controlled by
Mr John Kolenda to settle outstanding loans of $377,720.
◼ 19,244,088 shares with 9,622,044 attaching options were issued to Teldar Real Estate Pty Ltd a company controlled by
Mr Matt Lahood to settle outstanding loans of $1,252,719.
◼ 18,963,307 shares with 9,481,653 attaching options were issued to MAK Property Group Pty Ltd a company controlled by
Mr Shad Hassen to settle outstanding loans of $1,232,615.
◼ 18,963,307 shares with 9,481,653 attaching options were issued to Ben Collier Investments Pty Ltd a company controlled by
Mr Ben Collier to settle outstanding loans of $1,232,615.
◼ 19,244,088 shares with 9,622,044 attaching options were issued to SEMC 2 Pty Ltd a company controlled by Mr Steven Chen
to settle outstanding loans of $1,252,719.
◼ 7,692,308 shares with 3,846,154 attaching options were issued to Kalonda Pty Ltd to settle outstanding loans of $450,000.
◼ 714,286 options were issue to Kalonda Pty Ltd as a debt facilitation fee with a fair value of $14,297.
◼ 12,899,074 options with a fair value of $258,192 were issued to the Joint Lead Manager in consideration for capital raising
services.
7.1.4 The following shares were issued during the 12 months to 30 June 2020 to Amount Shares
Directors to settle accrued outstanding Directors’ fees from the 2019 year: S No.
Paul Niardone 116,719 1,795,682
Andrew Jensen 118,500 1,823,077
John Kolenda 87,494 1,346,061
Adam Davey 66,000 1,015,385
Total 388,713 5,980,205
P a g e | 51
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 7 Equity (cont.)
7.1.5 Accounting policy
Ordinary issued capital is recorded at the consideration received. Incremental costs directly attributable to the issue of
ordinary shares and share options are recognised as a deduction from equity, net of any related income tax benefit. Ordinary
issued capital bears no special terms or conditions affecting income or capital entitlements of the shareholders.
7.2 Performance shares 2021 2020
No. No.
Performance shares 1,555,558 1,555,558
7.2.1 During the 2020 financial year, 2,222,251 performance shares converted into 2,222,251 ordinary shares upon achieving
a 10% growth in the mortgage and finance business loan book within 18 months of settlement. The remaining 1,555,558
performance shares failed to vest (by achieving a 20-day volume VWAP on the ASX which equals or exceeds 3 times the
re-quotation price of $0.02, at any time within 24 months of settlement) and expired. These performance shares will
convert to five only ordinary shares, subsequent to balance date.
7.3 Options Note 2021 2020 2021 2020
No. No. $ $
Options 333,333 104,181,760 1,071,861 928,715
At the beginning of the year 104,181,760 5,588,912 928,715 583,426
Options issued/(lapsed) during the year:
◼ Attaching pursuant to a
Placement 8,461,539 -
◼ Attaching to an Entitlement Issue 34,495,371 -
◼ Equity-settled payments 7.1.3 44,944,823
◼ Lead Managers options 7.1.3 12,899,074 258,192
◼ Repayment of Kalonda debt 7.1.3 714,286 14,297
◼ Financing costs in respect to the
convertible note options 7.3.1 2,000,000 72,800
◼ Issued in connection with 5.7.1b 12,000,000 222,000
Convertible notes
◼ Exercise of $0.027 options (12,000,000) (222,000)
◼ Exercise of $0.0338 options (2,000,000) (72,800)
◼ Granted (and to be issued) to 19.2.1a - 215,946
CEO in accordance with
employment agreements
◼ Expiry of options (101,848,427) (4,922,245) - -
At reporting date 333,333 104,181,760 1,071,861 928,715
7.3.1 During the 2021 year, 12,000,000 options were issued as part of the convertible note (2020: 2,000,000).
7.4 Reserves Note 2021 2020
$ $
Share-based payment reserve 7.4.1 1,071,861 928,715
1,071,861 928,715
7.4.1 Share-based payment reserve
The share-based payment reserve records the value of options and performance shares issued by the Company to its
employees or consultants.
P a g e | 52
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
SECTION B. RISK
This section of the notes discusses the Group’s exposure to various risks and shows how these could affect the Group’s financial
position and performance.
Note 8 Financial risk management
8.1 Financial Risk Management Policies
This note presents information about the Group’s exposure to each of the above risks, its objectives, policies and
procedures for measuring and managing risk, and the management of capital.
The Group’s financial instruments consist mainly of deposits with banks, short-term investments, and accounts payable
and receivable.
The Group does not speculate in the trading of derivative instruments.
A summary of the Group’s financial assets and liabilities is shown below:
Floating Fixed Non- Floating Fixed Non-
Interest Interest interest 2021 Interest Interest interest 2020
Rate Rate Bearing Total Rate Rate Bearing Total
$ $ $ $ $ $ $ $
Financial Assets
◼ Cash and cash equivalents 5,096,435 - - 5,096,435 2,724,142 - - 2,724,142
◼ Trade and other receivables - - 8,516,413 8,516,413 - - 4,870,877 4,870,877
◼ Bank guarantees and restricted cash - 612,860 - 612,860 1,600,000 170,388 - 1,770,388
Total Financial Assets 5,096,435 612,860 8,516,413 14,225,708 4,324,142 170,388 4,870,877 9,365,407
Financial Liabilities
Financial liabilities at amortised cost
◼ Trade and other payables - - 11,194,122 11,194,122 - - 9,773,151 9,773,151
◼ Borrowings 5,000,000 - - 5,000,000 12,093,235 1,750,000 - 13,843,235
◼ Leases - 5,845,170 - 5,845,170 - 5,874,977 - 5,874,977
◼ Financial liabilities - Convertible
notes - 4,882,672 - 4,882,672 - - - -
Total Financial Liabilities 5,000,000 10,727,842 11,194,122 26,921,964 12,093,235 7,624,977 9,773,151 29,491,363
Net Financial Assets / (Liabilities) 96,435 (10,114,982) (2,677,709) (12,696,256) (7,769,093) (7,454,589) (4,902,274) (20,125,956)
8.2 Specific Financial Risk Exposures and Management
The main risk the Group is exposed to through its financial instruments are credit risk, liquidity risk and market risk
consisting of interest rate, foreign currency risk and equity price risk. The Group’s overall risk management program
focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial
performance of the Group.
The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework.
The Board adopts practices designed to identify significant areas of business risk and to effectively manage those risks in
accordance with the Group’s risk profile. This includes assessing, monitoring and managing risks for the Group and setting
appropriate risk limits and controls. The Group is not of a size nor is its affairs of such complexity to justify the
establishment of a formal system for risk management and associated controls. Risk management is carried out by the
full Board of Directors as the Group believes that it is crucial for all board members to be involved in this process. The
Chairman, with the assistance of senior management as required, has responsibility for identifying, assessing, treating
and monitoring risks and reporting to the Board on risk management.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 8 Financial risk management (cont.)
8.2.1 Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract
obligations that could lead to a financial loss to the Group.
Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient
collateral where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group only transacts
with entities that are rated the equivalent of investment grade and above. This information is supplied by independent
rating agencies where available and, if not available, the Group uses publicly available financial information and its own
trading record to rate its major customers. The Group’s exposure and the credit ratings of its counterparties are
continuously monitored, and the aggregate value of transactions concluded is spread amongst approved counterparties.
Credit exposure is controlled by counterparty limits that are reviewed and approved by the risk management committee
annually.
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and
other receivables.
◼ Credit risk exposures
The maximum exposure to credit risk, arising from cash and cash equivalents and trade receivables, is limited to the
carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial
position and notes to the financial statements.
Credit risk related to balances with banks and other financial institutions is managed by the Group in accordance with
approved Board policy. Such policy requires that surplus funds are only invested with financial institutions residing in
Australia, wherever possible. There are no significant concentrations of credit risk, whether through exposure to
individual customers, specific industry sectors and/or regions.
◼ Impairment losses
The ageing of the Group’s current trade and other receivables at reporting date was as follows:
Past due but not
Gross Impaired Net impaired
2021 2021 2021 2021
$ $ $ $
Trade receivables
Not past due 4,390,843 - 4,390,843 -
Past due up to 30 days 1,005,293 - 1,005,293 1,005,293
Past due 31 days to 90 days 741,696 - 741,696 741,696
Past due over 90 days 884,326 (186,544) 697,782 697,782
7,022,158 (186,544) 6,835,614 2,444,771
Other receivables
Not past due 1,794,255 (113,456) 1,680,799 -
Total 8,816,413 (300,000) 8,516,413 2,444,771
8.2.2 Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage
to the Group’s reputation.
Ultimate responsibility for liquidity risk management rests with the Board, who have built an appropriate liquidity risk
management framework for the management of the Group’s short, medium and long-term funding and liquidity
management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and
reserve borrowing facilities by continuously monitoring forecast and actual cash flows and matching the maturity profiles
of financial assets and liabilities. The Group’s ability to raise debt and / or equity funding in the market is paramount in
this regard.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 8 Financial risk management (cont.)
The Group has no access to credit standby facilities or arrangements for further funding or borrowings in place. The
financial liabilities the Group had at the end of the reporting period were trade and other payables incurred in the normal
course of the business. These were non-interest bearing and were due within the normal 30-60 days terms of creditor
payments.
◼ Contractual Maturities
The table below analyses the Group’s financial liabilities and assets into relevant maturity groupings based on the
remaining period at the end of the reporting period to the contractual maturity date. The amounts disclosed in the
table are the contractual undiscounted cash flows:
Within 1 Year Greater Than 1 Year Total
2021 2020 2021 2020 2021 2020
$ $ $ $ $ $
Financial liabilities due for payment
Trade and other payables 11,194,122 9,773,151 - - 11,194,122 9,773,151
Borrowings - 13,843,235 5,000,000 - 5,000,000 13,843,235
Financial liabilities - convertible notes - - 4,882,672 - 4,882,672 -
Leases 1,828,270 1,979,900 4,016,900 3,895,077 5,845,170 5,874,977
Total contractual outflows 13,022,392 25,596,286 13,899,572 3,895,077 26,921,964 29,491,363
Financial assets
Cash and cash equivalents 5,096,435 2,724,142 - - 5,096,435 2,724,142
Trade and other receivables 8,353,403 4,601,222 163,010 269,655 8,516,413 4,870,877
Bank guarantees and restricted cash - 1,600,000 612,860 170,388 612,860 1,770,388
Total anticipated inflows 13,449,838 8,925,364 775,870 440,043 14,225,708 9,365,407
Net (outflow) / inflow on financial
instruments 427,446 (16,670,922) (13,123,702) (3,455,034) (12,696,256) (20,125,956)
It is not expected that the cash flows included in the maturity analysis could occur significantly earlier or at
significantly different amounts.
8.2.3 Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will
affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management
is to manage and control market risk exposures within acceptable parameters, while optimising the return.
The Group’s activities minimally expose it to the financial risks of changes in foreign currency exchange rates, commodity
prices and exchange rates. The Group does not enter into derivative financial instruments including foreign exchange
forward contracts to hedge against financial risk. There has been no change to the Group’s exposure to market risks or
the manner in which it manages and measures the risk from the previous period.
a. Interest rate risk
The Group are exposed to interest rate risk as the Group borrows funds at both fixed and floating interest rates. The
risk is managed by the Group by maintaining an appropriate mix between fixed and floating rate borrowings.
The Group’s policy is to monitor the interest rate yield curve out to six months to ensure a balance is maintained
between the liquidity of cash assets and the interest rate return. Cash at bank and in hand earns interest at floating
rates based on daily bank deposit rates. The Group does not have any receivables or payables that may be affected
by interest rate risk.
b. Foreign exchange risk
The Group is not exposed to any material foreign exchange risk.
P a g e | 55
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 8 Financial risk management (cont.)
c. Price risk
Price risk relates to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market prices. The Group does not presently hold material amounts subject to price risk. As such the
Board considers price risk as a low risk to the Group.
8.2.4 Sensitivity Analyses
The Group is not exposed to any material sensitivities.
8.2.5 Net Fair Values
a. Fair value estimation
The fair values of financial assets and financial liabilities are presented in the table in note 8.1 and can be compared
to their carrying values as presented in the statement of financial position. Fair values are those amounts at which
an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length
transaction.
Financial instruments whose carrying value is equivalent to fair value due to their nature include:
◼ Cash and cash equivalents;
◼ Trade and other receivables; and
◼ Trade and other payables.
The methods and assumptions used in determining the fair values of financial instruments are disclosed in the
accounting policy notes specific to the asset or liability.
Note 9 Capital Management
9.1.1 Capital
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while
maximising the return to stakeholders through the optimisation of the debt and equity balance.
Capital is defined as the combination of contributed equity, reserves and net debt (borrowings less cash). The Board is
responsible for monitoring and approving the capital management framework within which management operates. The
Group’s objective when managing capital is to safeguard its ability to continue as a going concern, so that it can continue
to provide returns for shareholders and benefits for other stakeholders such as employees. The Group focuses on
interrelated financial parameters, including its gearing ratio, earnings growth, average cost of debt, gearing, weighted
average debt maturity and borrowing capacity. These are taken into account when the Group makes decisions on how
to invest its capital and evaluate its existing investments.
The capital structure of the Group can be changed by paying distributions to shareholders, returning capital to
shareholders, issuing new shares or selling assets
9.1.2 Working Capital
The working capital position of the Group was as follows: Note 2021 2020
$ $
Cash and cash equivalents 5.1 5,096,435 2,724,142
Trade and other receivables 5.2.1 8,353,403 4,601,222
Financial assets 5.3.1 - 1,600,000
Other current assets (excl. prepayments) 5.4.1 17,690 542,840
Trade and other payables 5.5.1 (11,194,122) (9,773,151)
Borrowings 5.6.1 - (13,843,235)
Leases 6.2.2 (1,828,270) (1,979,900)
Current provisions 6.4 (2,565,406) (2,286,835)
Working capital position (2,120,270) (18,414,917)
P a g e | 56
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
SECTION C. GROUP STRUCTURE
This section provides information which will help users understand how the Group structure affects the financial position and
performance of the Group as a whole. In particular, there is information about:
(a) changes to the structure that occurred during the year as a result of business combinations and the disposal of a discontinued
operation.
(b) transactions with non-controlling interests, and
(c) interests in joint operations.
A list of significant subsidiaries is provided in note 10 below. This note also discloses details about the Group’s equity accounted
investments.
Note 10 Interest in subsidiaries
10.1 Information about principal subsidiaries
The subsidiaries listed below have share capital consisting solely of ordinary shares which are held directly by the Group
and the proportion of ownership interest held equals the voting rights held by the Group. Investments in subsidiaries are
accounted for at cost. Each subsidiaries’ country of incorporation is also its principal place of business, being Australia:
Entity name Class of Percentage Owned Entity name Class of Percentage Owned
Shares 2021 2020 Shares 2021 2020
◼ Agency Partners WA Pty Ltd Ord. 100 100 ◼ The Agency Property Ord. 100 100
◼ Ausnet Financial Planning Ord. 100 100 Management NSW Pty Ltd
Services Pty Ltd ◼ The Agency Property Ord. 100 100
◼ Ausnet Financial Pty Ltd Ord. 100 100 Management QLD Pty Ltd
◼ Ausnet Property Investment Fund Ord. 100 100 ◼ The Agency Property Ord. 100 100
Pty Ltd Management VIC Pty Ltd
◼ Ausnet Real Estate Services Pty Ord. 100 100 ◼ The Agency Property Ord. nil 100
Ltd Management WA Pty Ltdi
◼ Courtesy Real Estate (NSW) Pty Ord. 100 100 ◼ The Agency Real Estate Pty Ltd Ord. 100 100
Ltd ◼ The Agency Sales NSW Pty Ltd Ord. 100 100
◼ Jelina Holdings Pty Ltd Ord. 100 100 ◼ The Agency Sales QLD Pty Ltd Ord. 100 100
◼ Move Property Solutions Pty Ltd Ord. 100 100 ◼ The Agency Sales VIC Pty Ltd Ord. 100 100
◼ S.J. Laing & Son Pty Ltd Ord. 100 100 ◼ The Real Estate Group Australia Ord. 100 100
◼ The Agency Auctions NSW Pty Ltd Ord. 100 100 Pty Ltd
◼ The Agency Auctions QLD Pty Ltd Ord. 100 100 ◼ Top Level Real Estate Holdings Pty Ord. 100 100
◼ The Agency Auctions VIC Pty Ltd Ord. 100 100 Ltd
◼ The Agency Commercial Real Ord. 100 100 ◼ Top Level Real Estate Pty Ltd Ord. 100 100
Estate Pty Ltd ◼ Top Level Real Estate Sales Pty Ltd Ord. 100 100
◼ The Agency Marketing Pty Ltd Ord. 100 100 ◼ Value Partner Program Pty Ltd Ord. 100 100
Formerly Ausnet Real Estate Network Pty Ltd
◼ The Agency Project Sales NSW Pty Ord. 100 100
◼ Vicus Residential Pty Ltdii Ord. nil 100
Ltd
◼ Vision Capital Management Ltd Ord. 100 100
◼ The Agency Project Sales QLD Pty Ord. 100 100
Ltd ◼ Westvalley Corporation Pty Ltd Ord. 100 100
◼ The Agency Project Sales VIC Pty Ord. 100 100
Ltd
i. Disposed as per note 1.2.1
ii. Deregistered 21 September 2020
P a g e | 57
ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 11 Other Significant Accounting Policies related to Group Structure
11.1 Basis of consolidation
As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated financial
statements as well as their results for the year then ended. Where controlled entities have entered (left) the Consolidated
Group during the year, their operating results have been included (excluded) from the date control was obtained (ceased).
11.1.1 Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business
combination is measured at fair value, which is calculated as the sum of the acquisition‑date fair values of assets transferred
by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity interest issued by the
Group in exchange for control of the acquiree. Acquisition‑related costs are recognised in profit or loss as incurred. At the
acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value at the
acquisition date, except that:
◼ deferred tax assets or liabilities and assets or liabilities related to employee benefit arrangements are recognised and
measured in accordance with AASB 112 Income Taxes and AASB 119 Employee Benefits respectively;
◼ liabilities or equity instruments related to share‑based payment arrangements of the acquiree or share‑based payment
arrangements of the Group entered into to replace share‑based payment arrangements of the acquiree are measured
in accordance with AASB 2 Share‑Based Payments at the acquisition date; and
◼ assets (or disposal groups) that are classified as held for sale in accordance with AASB 5 Non‑current Assets Held for Sale
and Discontinued Operations are measured in accordance with that Standard.
a. Goodwill
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non‑controlling
interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over
the net of the acquisition‑date amounts of the identifiable assets acquired and the liabilities assumed. If, after
reassessment, the net of the acquisition‑date amounts of the identifiable assets acquired and liabilities assumed exceeds
the sum of the consideration transferred, the amount of any non‑controlling interests in the acquiree and the fair value
of the acquirer’s previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as
a bargain purchase gain.
When the consideration transferred by the Group in a business combination includes contingent consideration
arrangement, the contingent consideration is measured at its acquisition‑date fair value and included as part of the
consideration transferred in a business combination. Changes in fair value of the contingent consideration that qualify
as measurement period adjustments are adjusted retrospectively, with corresponding adjustments against goodwill.
Measurement period adjustments are adjustments that arise from additional information obtained during the
‘measurement period’ (which cannot exceed one year from the acquisition date) about facts and circumstances that
existed at the acquisition date.
The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as
measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration
that is classified as equity is not remeasured at subsequent reporting dates and its subsequent settlement is accounted
for within equity. Other contingent consideration is remeasured to fair value at subsequent reporting dates with changes
in fair value recognised in profit or loss.
When a business combination is achieved in stages, the Group’s previously held interests in the acquired entity are
remeasured to its acquisition‑date fair value and the resulting gain or loss, if any, is recognised in profit or loss. Amounts
arising from interests in the acquiree prior to the acquisition date that have previously been recognised in other
comprehensive income are reclassified to profit or loss, where such treatment would be appropriate if that interest were
disposed of.
If the initial accounting for a business combination is incomplete by the end of the reporting period in which the
combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those
provisional amounts are adjusted during the measurement period, or additional assets or liabilities are recognised, to
reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known,
would have affected the amounts recognised as of that date.
P a g e | 58
THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 11 Other Significant Accounting Policies related to Group Structure
b. Intangible assets acquired in a business combination
Intangible assets acquired in a business combination and recognised separately from goodwill are recognised initially at
their fair value at the acquisition date (which is regarded as their cost).
Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less
accumulated amortisation and accumulated impairment losses, on the same basis as intangible assets that are acquired
separately.
c. Contingent liabilities acquired in a business combination
Contingent liabilities acquired in a business combination are initially measured at fair value at the acquisition date. At
the end of subsequent reporting periods, such contingent liabilities are measured at the higher of the amount that would
be recognised in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets and the amount
recognised initially less cumulative amount of income recognised in accordance with the principles of AASB 15 Revenue
from Contracts with Customers.
11.1.2 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.
Equity interests in a subsidiary not attributable, directly or indirectly, to the Group are presented as non-controlling interests.
The Group initially recognises non-controlling interests that are present ownership interests in subsidiaries and are entitled
to a proportionate share of the subsidiary’s net assets on liquidation at either fair value or at the non-controlling interests’
proportionate share of the subsidiary’s net assets. Subsequent to initial recognition, non-controlling interests are attributed
their share of profit or loss and each component of other comprehensive income. Non-controlling interests are shown
separately within the equity section of the statement of financial position and statement of comprehensive income.
The grant by the Company of options over its equity instruments to the employees of subsidiary undertakings in the Group
is treated as a capital contribution to that subsidiary undertaking. The fair value of employee services received, measured
by reference to the grant date fair value, is recognised over the vesting period as an increase to investment in subsidiary
undertakings, with a corresponding credit to equity.
Losses applicable to the non-controlling interests in a subsidiary are allocated to the non-controlling interests even if doing
so causes the non-controlling interests to have a deficit balance.
A list of controlled entities is contained in note 10 Interest in subsidiaries of the financial statements.
11.1.3 Loss of control
Upon the loss of control, the Group derecognises the assets and liabilities of the subsidiary, any non-controlling interests
and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised
in profit or loss. If the Group retains any interest in the previous subsidiary, then such interests are measured at fair value at
the date control is lost. Subsequently it is accounted for as an equity-accounted investee or as an available-for-sale financial
asset depending on the level of influence retained.
11.1.4 Transactions eliminated on consolidation
All intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions,
are eliminated in preparing the consolidated financial statements.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
SECTION D. UNRECOGNISED ITEMS
This section of the notes includes other information that must be disclosed to comply with the accounting standards and other
pronouncements, but that is not immediately related to individual line items in the financial statements.
Note 12 Commitments
There are no material commitments to the Group as at 2021 (2020: Nil).
Note 13 Events subsequent to reporting date
13.1 On 4 August 2021, the Company advised that it has executed an amendment deed to its loan agreement with Macquarie Bank
Limited. Pursuant to the terms of the amendment deed, the revised terms of the loan include:
◼ Interest rate Base Rate (BBSW) + margin of 3.75%.
The Base Rate (determined monthly) has ranged between 0.01% to 0.0917% during the period
◼ Covenants The Company has covenanted to Macquarie that it will:
maintain an EBITDA interest cover ratio of at least 3 times. The definition of interest expense
does not include financial indebtedness owed by the Company to Peters Investments Pty Ltd,
in accordance with the convertible notes issued on 15 May 2020 and 4 January 2021
respectively.
All other terms remain the same as disclosed in note 5.6.2b
There has not been any other matter or circumstance that has arisen after balance date that has significantly affected, or may
significantly affect, the operations of the Group, the results of those operations, or the state of affairs of the Group in future
financial periods.
Note 14 Contingent liabilities
On 20 January 2021, the Company announced the purported appointment of administrators to the Company by MCL 105 Pty Ltd
(MCL), a company controlled by former director Mitchell Atkins.
The purported appointment was based on an alleged and disputed $385,000 “debt” relating to alleged fees on a mandate entered
into for the purpose of securing debt funding under which MCL was unable to deliver funding during the term of its mandate. The
Company disputes the claim as well as the validity of the security charge MCL placed on the assets of the Group.
The Federal Court ordered that the purported appointments would have no effect (other than various technical matters) pending
the determination of the proceedings or other order and control of the Company remains with the Directors.
The Court also ordered that the administration or purported administration will end at 4pm on 1 February 2021 and a hearing was
scheduled on the same day that allowed an opportunity for any creditor or sufficiently interested party to apply to discharge or vary
the orders ending the purported administration. A copy of the Court’s orders was lodged with the ASX on www.fedcourt.gov.au,
proceeding number WAD 7 of 2021. The Court requested the Company to pay $400,000 to be held in the Court’s trust until the
matter is settled.
The Company’s position is that the alleged appointment by MCL was undertaken for the purpose of destabilising the Agency and
compelling the Company to pay a disputed fee, which is still being disputed by both parties’ lawyers at time the MCL appointed an
administrator.
On 1 February 2021, a hearing occurred in the Federal Court. As no creditors or other interested parties appeared or applied to
overturn the Court’s earlier orders, the purported administration ended at 4:00pm that day. At this hearing orders were made
programming the hearing of MCL disputed debt claim. That claim was heard on 4 March 2021, and the verdict on the case is yet to
be ruled. Subsequent to the verdict being delivered the Company will enforce the removal of the security charge MCL has placed on
the assets of the Group.
There are no other contingent liabilities as at 2021 (2020: Nil).
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
SECTION E. OTHER INFORMATION
This section of the notes includes other information that must be disclosed to comply with the accounting standards
and other pronouncements, but that is not immediately related to individual line items in the financial statements.
Note 15 Key Management Personnel compensation (KMP)
The names and positions of KMP are as follows:
◼ Andrew Jensen Executive Chairman and Chief Operating Officer
◼ Paul Niardone Managing Director
◼ Adam Davey Non-Executive Director
◼ Matt Lahood Executive Director
◼ Mitchell Atkins Non-Executive Director (appointed 1 October 2019, resigned 8 May 2020)
◼ John Kolenda Non-Executive Director (resigned 20 December 2019)
◼ Arjan van Ameyde Chief Financial Officer (appointed 1 February 2020)
Information regarding individual Directors and executives’ compensation and some equity instruments disclosures as required
by the Corporations Regulations 2M.3.03 is provided in the Remuneration report table on page 17.
2021 2020
$ $
Short-term employee benefits 1,934,695 1,209,888
Post-employment benefits 92,200 64,002
Equity-settled share-based payments 215,946 -
Total 2,242,841 1,273,890
Note 16 Related party transactions
Some Directors or former Directors of the Group hold or have held positions in other companies, where it is considered they
control or significantly influence the financial or operating policies of those entities. During the year, the following entities
provided services to the Group.
Total Transactions Receivable/(Payable) Balance
Entity Nature of transactions KMP 2021 2020 2021 2020
$ $ $ $
Chapter One Advisers(1) Public Relations Paul Niardone 7,000 59,000 N/A (11,000)
Matt Lahood Advance commissions / Matt Lahood 90,000 44,050 84,074 52,783
Future fund
Aura Capital Pty Ltd Placement fees / John Kolenda - 415,089 - (71,509)
transaction fees
Magnolia Capital Professional services Mitchell Atkins - 30,170 - -
(1) Chapter One Advisers discontinued to be a related entity in July 2020 as Mr Niardone ceased to have any control or significantly influence
the financial or operating policies of Chapter One Advisers.
During the 2020 financial year KMP loans settled by way equity as detailed in note 7.1.4.
Note 17 Auditor's remuneration 2021 2020
$ $
Remuneration of the auditor for:
◼ Auditing or reviewing the financial reports:
Hall Chadwick WA Audit Pty Ltd
(formerly known as Bentleys Audit & Corporate (WA) Pty Ltd) 146,000 141,661
◼ Non-audit services provided by a related practice of the Auditor 4,700 -
150,700 141,661
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 18 Earnings per share (EPS) Note 2021 2020
$ $
18.1 Reconciliation of earnings to profit or loss
Loss for the year (1,856,455) (9,065,337)
Less: loss attributable to non-controlling equity interest - -
Loss used in the calculation of basic and diluted EPS (1,856,455) (9,065,337)
2021 2020
No. No.
18.2 Weighted average number of ordinary shares outstanding
during the year used in calculation of basic EPS 353,288,916 251,793,328
Weighted average number of dilutive equity instruments outstanding 18.5 N/A N/A
18.3 Weighted average number of ordinary shares outstanding
during the year used in calculation of basic EPS 353,288,916 251,793,328
2021 2020
18.4 Earnings per share ₵ ₵
Basic EPS (cents per share) 18.5 (0.53) (3.60)
Diluted EPS (cents per share) 18.5 N/A N/A
18.5 As at 30 June 2021, the Group has 333,333 unissued shares under options (2020: 104,181,760) and 1,555,558 performance
shares on issue (2020: 1,555,558). The Group does not report diluted earnings per share on losses generated by the Group.
During the year, the Group's unissued shares under option and partly-paid shares were anti-dilutive.
Note 19 Share-based payments Note 2021 2020
$ $
19.1 Share-based payments:
◼ Recognised in profit and loss – share-based payment expense 19.2.1a 215,946 -
◼ Recognised in net assets in Embedded Derivatives 19.2.1b 222,000 -
◼ Recognised in profit and loss – Consultancy fees 19.2.2a - 724,000
◼ Recognised in profit and loss – Interest and finance costs 19.2.2b - 87,097
◼ Recognised in net assets as a reduction in borrowings and payables 19.2.2c,d - 6,187,101
◼ Recognised in equity – Transaction costs 19.2.2e - 258,192
Gross share-based payments 437,946 7,256,390
19.2 Share-based payment arrangements in effect during the period
19.2.1 Issued during the current year
a. Chief Executive Officer – Remuneration Options
On the commencement of employment, the Company granted Mr Geoff Lucas 30,000,000 options (to be issued) in
accordance with his employment agreement, on the following terms:
Number under Option Date of Expiry Consideration Exercise Price Vesting Terms
10,000,000 29 September 2022 nil $0.050 60 days after 6-month
probationary period
28 November 2021
10,000,000 29 September 2023 nil $0.075 12 months after 6-month
probationary period
29 September 2022
10,000,000 29 September 2024 nil $0.100 24 days after 6-month
probationary period
29 September 2023
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 19 Share-based payments (cont.)
b. Convertible note – attaching options
As detailed in note 5.7.1b, 12,000,000 options were issued to Peters Investments Pty Ltd in connection with the
provision of a convertible note.
Number under Option Date of Expiry Consideration Exercise Price Vesting Terms
12,000,000 31 March 2023 nil $0.027 Immediately upon issue
19.2.2 Issued in prior year, remaining in effect
a. Equity-settled consultant fees
As detailed in note 7.1.3, 11,138,462 shares were issued to consultants for services with a fair value of $724,000.
b. Equity-settled financing fees
As detailed in note 7.1.3, 714,286 options were issued as a debt facilitation fee with a fair value of $14,297, and as
disclosed in note 7.3.1, 2,000,000 options were issued as part of a convertible note fee with a fair value of $72,800.
Number under Option Date of Expiry Consideration Exercise Price Vesting Terms
714,286 31 December 2020 nil $0.065 Immediately upon issue
2,000,000 25 May 2022 nil $0.040 Immediately upon issue
c. Equity-settled loans
As detailed in note 7.1.3, 89,889,649 shares and 44,944,825 options were issued to settle $5,798,388 in loans.
Number under Option Date of Expiry Consideration Exercise Price Vesting Terms
44,944,823 31 December 2020 nil $0.065 Immediately upon issue
d. Equity-settled accrued Directors’ fees payable
As detailed in note 7.1.4, 5,980,205 shares were issued to Directors to settle accrued outstanding Directors’ fees from
the prior year amounting to $388,713.
e. Equity-settled transaction costs
As detailed in note 7.1.3, 12,899,074 options with a fair value of $258,192 were issued in consideration for capital
raising services.
Number under Option Date of Expiry Consideration Exercise Price Vesting Terms
12,899,074 31 December 2020 nil $0.065 Immediately upon issue
f. Performance Shares
During the 2020 financial year, 2,222,251 performance shares converted into 2,222,251 ordinary shares upon
achieving a 10% growth in the mortgage and finance business loan book within 18 months of settlement. The
remaining 1,555,558 performance shares failed to vest (by achieving a 20-day volume VWAP on the ASX which equals
or exceeds 3 times the re-quotation price of $0.02, at any time within 24 months of settlement) and expired. These
performance shares will convert to five only, ordinary shares, subsequent to balance date. Refer also 7.2.1.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 19 Share-based payments (cont.)
19.3 Movement in share-based payment arrangements during the period
A summary of the movements of all Company options issued as share-based payments is as follows:
2021 2020
Number of Weighted Average Number of Weighted Average
Options Exercise Price Options Exercise Price
Outstanding at the beginning of the year 104,181,760 $0.068 5,588,912 $3.873
Granted (refer 19.3a below) 42,000,000 $0.061 103,515,093 $0.065
Exercised (14,000,000) $0.028 - -
Expired (101,848,427) $0.068 (4,922,245) $4.321
Outstanding at year-end (refer 19.3a below) 30,333,333 $0.068 104,181,760 $0.068
Exercisable at year-end 333,333 $0.300 104,181,760 $0.068
a. Included in Granted and Outstanding at year-end are 30,000,000 options granted to Mr Geoff Lucas that subject to
vesting conditions and remain unissued as at 30 June 2021, as noted in 19.2.1a.
b. The weighted average remaining contractual life of options outstanding at year end was 0.53 years (2020: 0.53 years).
c. The fair value of the options granted to employees is deemed to represent the value of the employee services received
over the vesting period.
19.4 Fair value of options granted during the year
The fair value of the options granted to employees is deemed to represent the value of the employee services received
over the vesting period.
The weighted average fair value of options granted during the year was $0.0204 (2020: $0.0510). These values were
calculated using the Black-Scholes option pricing model, applying the following inputs to options issued this year:
Note Reference 19.2.1a 19.2.1a 19.2.1a 19.2.1b
Grant date: 29 March 2021 29 March 2021 29 March 2021 1 October 2020
Grant date share price: $0.060 $0.060 $0.060 $0.035
Option exercise price: $0.050 $0.075 $0.100 $0.027
Number of options issued: 10,000,000 10,000,000 10,000,000 12,000,000
Remaining life (years): 1.25 2.25 3.25 1.72
Expected share price volatility: 106.60 106.60 106.60 100.00
Risk-free interest rate: 0.08% 0.08% 0.66% 0.19%
Value per option $0.0320 $0.0333 $0.0360 $0.0185
Historical volatility has been the basis for determining expected share price volatility as it is assumed that this is indicative
of future movements.
The life of the options is based on the historical exercise patterns, which may not eventuate in the future.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 19 Share-based payments (cont.)
19.4.1 Accounting policy
The Group has provided payment to service providers and related parties in the form of share-based compensation whereby
services are rendered in exchange for shares or rights over shares, equity-settled transactions. The cost of these equity-
settled transactions is measured by reference to the fair value at the date at which they are granted. The fair value is
determined using an appropriate valuation model for services provided by employees or where the fair value of the goods
or services received cannot be reliably estimated.
For goods and services received where the fair value can be determined reliably the goods and services and the
corresponding increase in equity are measured at that fair value. The fair value of the options granted is adjusted to reflect
market vesting conditions, but excludes the impact of any non-market vesting conditions. Non-market vesting conditions
are included in assumptions about the number of options that are expected to become exercisable.
At each balance date, the entity revises its estimates of the number of options with non-market vesting conditions that are
expected to become exercisable.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in
which the performance conditions are fulfilled, ending on the date on which the relevant parties become fully entitled to
the award, vesting date.
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the
extent to which the vesting period has expired and (ii) the number of awards that, in the opinion of the Directors of the
Group, will ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment
is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the
determination of fair value at grant date.
Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not
been modified. In addition, an expense is recognised for any increase in the value of the transaction as a result of the
modification, as measured at the date of modification.
19.4.2 Key estimate
a. Share-based payments
The Group measures the cost of equity-settled transactions by reference to the fair value of the equity instrument at
the date at which they are granted. The fair value of options granted is measured using the Black-Scholes option pricing
model. The model uses assumptions and estimates as inputs. The assumptions and models used for estimating fair value
for share-based payment transactions are disclosed in note 19.4.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 20 Operating segments
20.1 Identification of reportable segments
The Group has identified its operating segments based on the internal reports that are provided to the Board of Directors
(the Board) monthly and in determining the allocation of resources.
The Group is managed primarily based on service offerings as the diversification of the Group’s operations inherently
have notably different risk profiles and performance assessment criteria. Operating segments are therefore determined
on the same basis.
20.2 Types of services by segment
20.2.1 Real Estate and Property Services
This represents revenue received for provision of real estate services including selling of property, settlement agent
services, and property management.
20.2.2 Mortgage Origination Services
This represents revenue received for provision of mortgage broking services.
20.2.3 Other (includes financial planning, head office etc)
This represents non-reportable segments including head office, financial planning, property investments, and other
services.
20.3 Basis of accounting for purposes of reporting by operating segments
20.3.1 Accounting policies adopted
Unless stated otherwise, all amounts reported to the Board, being the chief decision maker with respect to operating
segments, are determined in accordance with accounting policies that are consistent to those adopted in the annual
financial statements of the Group.
20.3.2 Inter-segment transactions
All such transactions are eliminated on consolidation of the Group's financial statements.
Inter-segment loans payable and receivable are initially recognised at the consideration received/to be received net of
transaction costs. If inter-segment loans receivable and payable are not on commercial terms, these are not adjusted to
fair value based on market interest rates. This policy represents a departure from that applied to the statutory financial
statements.
20.3.3 Segment assets
Where an asset is used across multiple segments, the asset is allocated to that segment that receives majority economic
value from that asset. In the majority of instances, segment assets are clearly identifiable on the basis of their nature and
physical location.
20.3.4 Segment liabilities
Liabilities are allocated to segments where there is a direct nexus between the incurrence of the liability and the
operations of the segment. Borrowings and tax liabilities are generally considered to relate to the Group as a whole and
are not allocated. Segment liabilities include trade and other payables and certain direct borrowings.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 20 Operating segments (cont.)
20.3.5 Unallocated items
The following items of revenue, expenses, assets, and liabilities are not allocated to operating segments as they are not
considered part of the core operations of any segment:
◼ Head office and corporate costs;
◼ Net gains on disposal of available-for-sale investments;
◼ Impairment of assets and other non-recurring items of revenue and expense;
◼ Income tax expense;
◼ Current and deferred tax assets and liabilities;
◼ Other financial assets;
◼ Intangibles assets; and
◼ Discontinued operations.
20.3.6 Segment information
a. The Group’s operations are from Australian sources and therefore no geographical segments are disclosed.
b. Assets and liabilities have not been reported on a segmented basis as the Board of Directors is provided with
consolidated information.
20.4 Segment Financial Performance
Real Estate Mortgage Total
Property Origination Reportable Other
Services Services Segments Segments Total
30 June 2021 $ $ $ $ $
Revenue
◼ External revenues 55,315,280 3,052,418 58,367,698 12,892 58,380,590
◼ Inter-segment revenues - - - - -
Total segment revenue 55,315,280 3,052,418 58,367,698 12,892 58,380,590
Reconciliation of segment revenue to Group revenue:
◼ Eliminations -
Total group revenue and other income _ 58,380,590
Segment earnings before interest, tax, depreciation,
and amortisation (EBITDA) 10,870,805 1,019,472 11,890,277 180,893 12,071,170
◼ Unallocated corporate costs (5,704,505)
EBITDA 6,366,665
Reconciliation of segment loss to Group loss:
(i) Unallocated items:
◼ Gain on disposal of assets 77,387 - 77,387 123,225 200,612
◼ Impairment - - - (400,000) (400,000)
◼ Depreciation and amortisation (5,203,520) (42,840) (5,246,360) (219,454) (5,465,814)
◼ Net finance costs (1,106,530) (3,406) (1,109,936) (1,139,072) (2,249,008)
◼ Fair value adjustments - - - (1,986,988) (1,986,988)
◼ Share-based payments - - - (215,946) (215,946)
Profit before income tax _ (3,750,479)
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 20 Operating segments (cont.)
Real Estate Mortgage Total
Property Origination Reportable Other
Services Services Segments Segments Total
30 June 2020 $ $ $ $ $
Revenue
◼ External revenues 39,023,834 2,817,248 41,841,082 20,439 41,861,521
◼ Inter-segment revenues - - - - -
Total segment revenue 39,023,834 2,817,248 41,841,082 20,439 41,861,521
Reconciliation of segment revenue to Group revenue:
◼ Eliminations -
Total group revenue and other income _ 41,861,521
Segment earnings before interest, tax, depreciation
and amortisation (EBITDA) 6,095,130 1,131,649 7,226,779 (1,518,252) 5,708,527
◼ Unallocated corporate costs (3,045,440)
EBITDA 2,663,087
Reconciliation of segment loss to Group loss:
(ii) Unallocated items:
◼ Impairment (5,230,330) - (5,230,330) - (5,230,330)
◼ Depreciation and amortisation (5,771,409) (23,410) (5,794,819) (243,790) (6,038,609)
◼ Net finance costs (1,446,487) - (1,446,487) (304,718) (1,751,205)
Profit before income tax _ (10,357,057)
20.5 Major customers
The Group has a diversified range of customers across various geographic locations and businesses, and is not dependant
on any one customer above 5%.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 21 Parent entity disclosures
The Agency Group Australia Ltd is the ultimate Australian parent entity and ultimate parent of the Group.
The Agency Group Australia Ltd did not enter into any trading transactions with any related party during the year.
21.1 Financial Position of The Agency Group Australia Ltd 2021 2020
$ $
Current assets 268,856 1,058,028
Non-current assets 6,767,714 2,964,975
Total assets 7,036,570 4,023,003
Current liabilities 1,180,470 3,947,812
Non-current liabilities 5,856,100 -
Total liabilities 7,036,570 3,947,812
Net assets - 75,191
Equity
Issued capital 43,635,166 39,395,942
Share-based payment reserve 1,071,861 928,715
Accumulated losses (44,707,027) (40,249,466)
Total equity - 75,191
21.2 Financial performance of The Agency Group Australia Ltd 2021 2020
$ $
Loss for the year (1,523,769) (2,152,572)
Other comprehensive income - -
Total comprehensive income (1,523,769) (2,152,572)
21.3 Guarantees
There are no guarantees entered into by The Agency Group Australia Ltd for the debts of its subsidiaries as at 2021
(2020: none).
21.4 Contractual commitments
The parent company has no capital commitments at 2021 (2020: $nil). The parent company other commitments are
disclosed in note 12 Commitments.
21.5 Contingent liabilities
There are no guarantees entered into by The Agency Group Australia Ltd for the debts of its subsidiaries as at 2021
(2020: none). The parent company other contingencies are disclosed in note 14 Contingent liabilities.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 22 Statement of significant accounting policies
This note provides a list of the significant accounting policies adopted in the preparation of these consolidated financial statements
to the extent they have not already been disclosed in the other notes above. These policies have been consistently applied to all the
years presented, unless otherwise stated.
22.1 Basis of preparation
22.1.1 Reporting Entity
The Agency Group Australia Ltd (The Agency or the Company) is a listed public company limited by shares, domiciled and
incorporated in Australia. These are the consolidated financial statements and notes of The Agency and controlled entities
(collectively the Group). The financial statements comprise the consolidated financial statements of the Group. For the
purposes of preparing the consolidated financial statements, the Company is a for-profit entity. The Group is a for-profit
entity and is primarily involved in the integrated real estate services.
The separate financial statements of The Agency, as the parent entity, have not been presented with this financial report as
permitted by the Corporations Act 2001 (Cth).
22.1.2 Basis of accounting
These financial statements are general purpose financial statements which have been prepared in accordance with
Australian Accounting Standards and Interpretations of the Australian Accounting Standards Board (AAS Board) and
International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB), and the
Corporations Act 2001 (Cth).
Australian Accounting Standards (AASBs) set out accounting policies that the AAS Board has concluded would result in a
financial report containing relevant and reliable information about transactions, events and conditions to which they apply.
Compliance with AASBs ensures that the financial statements and notes also comply with IFRS as issued by the IASB.
The financial statements were authorised for issue on 29 September 2021 by the Directors of the Company.
22.1.3 Going Concern
The financial report has been prepared on a going concern basis, which contemplates the continuity of normal business
activity and the realisation of assets and the settlement of liabilities in the ordinary course of business.
The Group incurred a loss for the year of $1,856,455 (2020: $9,065,337 loss) and a net cash in-flow from operating activities
of $4,643,389 (2020: $334,704 in-flow). Included in the loss during the year was depreciation and amortisation of
$5,465,814, embedded derivative non-cash financing cost $2,243,784, and impairment of $400,000.
As at 30 June 2021, the Company had a working capital deficit of $2,120,270 (2020: $18,414,917 working capital deficit)
The Directors have prepared a cash flow forecast, which indicates that the Group will have sufficient cash flows to meet
commitments and working capital requirements for the 12-month period from the date of signing this financial report.
The ability of the Group to continue as a going concern is principally dependent on the following:
◼ The Group continuing to generate cash flows from profitable operations; and
◼ The Group being in compliance with all terms of its debt facilities and not breaching the terms of its borrowing
facilities.
In the event the above are not achieved the Group will need to raise funds from issued capital and/or alternative financing
arrangements.
Based on the cash flow forecasts and other factors referred to above, the directors are satisfied that the going concern basis
of preparation is appropriate. In particular, given the Group’s history of raising capital to date, the directors are confident of
the Group’s ability to raise additional funds as and when they are required.
22.1.4 Comparative figures
Where required by AASBs comparative figures have been adjusted to conform to changes in presentation for the current
financial year.
Where the Group retrospectively applies an accounting policy, makes a retrospective restatement or reclassifies items in its
financial statements, an additional (third) statement of financial position as at the beginning of the preceding period in
addition to the minimum comparative financial statements is presented.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 22 Statement of significant accounting policies
22.1.5 New and Amended Standards Adopted by the Group
The Group has applied the following standards and amendments for the first time for their annual reporting period
commencing 1 July 2020:
◼ AASB 2018-6 Amendments to Australian Accounting Standards – Definition of a Business
◼ AASB 2018-7 Amendments to Australian Accounting Standards – Definition of Material
◼ AASB 2019-1 Amendments to Australian Accounting Standards – References to the Conceptual Framework
◼ AASB 2019-3 Amendments to Australian Accounting Standards – Interest Rate Benchmark Reform
◼ AASB 2019-5 Amendments to Australian Accounting Standards – Disclosure of the Effect of New IFRS Standards Not Yet
Issued in Australia
◼ AASB 2020-4 Amendments to Australian Accounting Standards – COVID-19-Related Rent Concessions
The amendments listed above did not have any impact on the amounts recognised in prior periods and are not expected to
significantly affect the current or future periods.
22.2 Goods and Services Tax
Goods and Services Tax (GST) is and Australian broad-based consumption taxes that the Group is exposed to.
Revenues, expenses, and assets are recognised net of the amount of 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 an item of the expense. Receivables and payables in the statement of financial position are shown
inclusive of GST.
The net amount of GST recoverable from, or payable to, the Australian Taxation Office (or jurisdictional equivalent) is
included as a current asset or liability in the balance sheet.
Cash flows are presented in the statement of cash flows on a gross basis, except for the GST component of investing and
financing activities, which are disclosed as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation
authority.
22.3 Foreign currency transactions and balances
22.3.1 Functional and presentation currency
The functional currency of each of the Group's entities is measured using the currency of the primary economic environment
in which that entity operates. The consolidated financial statements are presented in Australian dollars which is the legal
parent entity's functional and presentation currency. The functional currency of the Group is the Australian Dollar.
22.4 Use of estimates and judgments
The preparation of consolidated financial statements requires management to make judgements, estimates and
assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses.
These estimates and associated assumptions are based on historical experience and various factors that are believed to be
reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of
assets and liabilities that are not readily apparent from other sources. 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 estimate is revised and in any future periods affected.
Judgements made by management in the application of AASBs that have significant effect on the consolidated financial
statements and estimates with a significant risk of material adjustment in the next year are discussed in Note 22.4.1.
22.4.1 Critical Accounting Estimates and Judgments
Management discusses with the Board the development, selection and disclosure of the Group's critical accounting policies
and estimates and the application of these policies and estimates. The estimates and judgements that have a significant risk
of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed
below.
a. Key estimate – Taxation
Refer note 4.8 of the Income tax note.
b. Key judgement and keys estimate – Impairment of goodwill and rent roll
Refer note 6.3 Intangible assets.
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 22 Statement of significant accounting policies
c. Key judgement – determining the lease term
Refer note 6.2 Leases.
d. Key estimate – determining convertible note embedded derivative
Refer note 5.7 Financial liabilities.
e. Key estimate – Share-base payments
Refer note 19 Share-based payments note.
22.4.2 Coronavirus (COVID-19) pandemic
Judgement has been exercised in considering the impacts that the COVID-19 pandemic has had, or may have, on the
consolidated entity based on known information. This consideration extends to the nature of the supply chain, staffing and
geographic regions in which the consolidated entity operates. Other than as addressed in specific notes, there does not
currently appear to be either any significant impact upon the financial statements or any significant uncertainties with
respect to events or conditions which may impact the consolidated entity unfavourably as at the reporting date or
subsequently as a result of the COVID-19 pandemic.
22.5 Fair Value
22.5.1 Fair Value of Assets and Liabilities
The Group measures some of its assets and liabilities at fair value on either a recurring or non-recurring basis, depending on
the requirements of the applicable AASB.
Fair value is the price the Group would receive to sell an asset or would have to pay to transfer a liability in an orderly
unforced transaction between independent, knowledgeable, and willing market participants at the measurement date.
As fair value is a market-based measure, the closest equivalent observable market pricing information is used to determine
fair value. Adjustments to market values may be made having regard to the characteristics of the specific asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation
techniques. These valuation techniques maximise, to the extent possible, the use of observable market data.
To the extent possible, market information is extracted from either the principal market for the asset or liability (i.e. the
market with the greatest volume and level of activity for the asset or liability) or, in the absence of such a market, the most
advantageous market available to the entity at the end of the reporting period (i.e. the market that maximises the receipts
from the sale of the asset or minimises the payments made to transfer the liability, after taking into account transaction
costs and transport costs).
For non-financial assets, the fair value measurement also considers a market participant's ability to use the asset in its
highest and best use or to sell it to another market participant that would use the asset in its highest and best use.
The fair value of liabilities and the entity's own equity instruments (excluding those related to share-based payment
arrangements) may be valued, where there is no observable market price in relation to the transfer of such financial
instruments, by reference to observable market information where such instruments are held as assets. Where this
information is not available, other valuation techniques are adopted and, where significant, are detailed in the respective
note to the financial statements.
22.5.2 Fair value hierarchy
AASB 13 Fair Value Measurement requires the disclosure of fair value information by level of the fair value hierarchy, which
categorises fair value measurements into one of three possible levels based on the lowest level that an input that is
significant to the measurement can be categorised into as follows:
Level 1 Level 2 Level 3
Measurements based on quoted prices Measurements based on inputs other than Measurements based on unobservable
(unadjusted) in active markets for quoted prices included in Level 1 that are inputs for the asset or liability.
identical assets or liabilities that the observable for the asset or liability, either
entity can access at the measurement directly or indirectly.
date.
The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation
techniques. These valuation techniques maximise, to the extent possible, the use of observable market data. If all significant
inputs required to measure fair value are observable, the asset or liability is included in Level 2. If one or more significant
inputs are not based on observable market data, the asset or liability is included in Level 3.
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THE AGENCY GROUP AUSTRALIA LTD ANNUAL REPORT
AND CONTROLLED ENTITIES 30 June 2021
ABN 52 118 913 232
Notes to the consolidated financial statements
for the year ended 30 June 2021
Note 22 Statement of significant accounting policies
The Group would change the categorisation within the fair value hierarchy only in the following circumstances:
◼ if a market that was previously considered active (Level 1) became inactive (Level 2 or Level 3) or vice versa; or
◼ if significant inputs that were previously unobservable (Level 3) became observable (Level 2) or vice versa.
When a change in the categorisation occurs, the Group recognises transfers between levels of the fair value hierarchy (i.e.
transfers into and out of each level of the fair value hierarchy) on the date the event or change in circumstances occurred.
22.5.3 Valuation techniques
The Group selects a valuation technique that is appropriate in the circumstances and for which sufficient data is available to
measure fair value. The availability of sufficient and relevant data primarily depends on the specific characteristics of the
asset or liability being measured. The valuation techniques selected by the Group are consistent with one or more of the
following valuation approaches:
◼ Market approach: valuation techniques that use prices and other relevant information generated by market transactions
for identical or similar assets or liabilities.
◼ Income approach: valuation techniques that convert estimated future cash flows or income and expenses into a single
discounted present value.
◼ Cost approach: valuation techniques that reflect the current replacement cost of an asset at its current service capacity.
Each valuation technique requires inputs that reflect the assumptions that buyers and sellers would use when pricing the
asset or liability, including assumptions about risks. When selecting a valuation technique, the Group gives priority to those
techniques that maximise the use of observable inputs and minimise the use of unobservable inputs. Inputs that are
developed using market data (such as publicly available information on actual transactions) and reflect the assumptions that
buyers and sellers would generally use when pricing the asset or liability are considered observable, whereas inputs for
which market data is not available and therefore are developed using the best information available about such assumptions
are considered unobservable.
22.6 New Accounting Standards and Interpretations not yet mandatory or early adopted
Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2021
reporting periods and have not been early adopted by the Group. These standards are not expected to have a material
impact on the entity in the current or future reporting periods and on foreseeable future transactions.
Note 23 Company details
The registered office and head office of the Company is:
Street: 68 Milligan Street Postal: PO Box 7768
Perth WA 6000 CLOISTERS SQUARE WA 6850
Australia Australia
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ANNUAL REPORT THE AGENCY GROUP AUSTRALIA LTD
30 June 2021 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' declaration
The Directors of the Company declare that:
1. The financial statements and notes, as set out on pages 23 to 73, are in accordance with the Corporations Act 2001 (Cth) and:
(a) comply with Accounting Standards;
(b) are in accordance with International Financial Reporting Standards issued by the International Accounting Standards
Board, as stated in note 22.1 to the financial statements; and
(c) give a true and fair view of the financial position as at 30 June 2021 and of the performance for the year ended on that
date of the Group.
(d) the Directors have been given the declarations required by s.295A of the Corporations Act 2001 (Cth);
2. 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.
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:
PAUL NIARDONE
Managing Director
Dated this Wednesday, 29 September 2021
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Independent auditor's report
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Corporate governance statement
The Board is responsible for establishing the Company’s corporate governance framework. In establishing its corporate
governance framework, the Board has referred to the 4th edition of the ASX Corporate Governance Councils’ Corporate
Governance Principles and Recommendations.
The Corporate Governance Statement discloses the extent to which the Company follows the recommendations. The Company
will follow each recommendation where the Board has considered the recommendation to be an appropriate benchmark for its
corporate governance practices. Where the Company’s corporate governance practices will follow a recommendation, the Board
has made appropriate statements reporting on the adoption of the recommendation. In compliance with the “if not, why not”
reporting regime, where, after due consideration, the Company’s corporate governance practices will not follow a
recommendation, the Board has explained its reasons for not following the recommendation and disclosed what, if any,
alternative practices the Company will adopt instead of those in the recommendation.
The Company’s governance-related documents can be found on its website at www.investors.theagency.com.au/corporate-
governance.
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ABN 52 118 913 232
Additional Information for Listed Public Companies
The following additional information is required by the Australian Securities Exchange in respect of listed public companies.
1 Capital as at 31 August 2021.
a. Ordinary share capital
428,575,916 ordinary fully paid shares held by 996 shareholders.
b. Options over Unissued Shares
Number of Exercise Price Expiry ASX
Options $ Date Status
333,333 0.300 11 Jan 2022 Unlisted
333,333
c. Performance Shares over Unissued Shares
Class of Performance Condition Performance Milestone Date Expiry Date
Performance rights
Right No.
Incentive Achieving a 20-day volume VWAP on the ASX 1,555,558 24 months of Expired
Performance which equals or exceeds 3 times the re- settlement These performance
Shares quotation price of $0.02, at any time within 24 shares will convert
months of settlement to five only ordinary
shares, subsequent
to balance date
1,555,558
d. Voting Rights
The voting rights attached to each class of equity security are as follows:
◼ Ordinary shares: Each ordinary share is entitled to one vote when a poll is called, otherwise each member present
at a meeting or by proxy has one vote on a show of hands.
◼ Options: Options do not entitle the holders to vote in respect of that equity instrument, nor participate in
dividends, when declared, until such time as the options are exercised or performance shares convert and
subsequently registered as ordinary shares.
◼ Performance Shares: A Performance Right does not entitle a Holder to vote on any resolutions proposed at a
general meeting of shareholders of the Company. A Performance Right does not entitle a Holder to any dividends.
A Performance Right does not entitle the Holder to participate in the surplus profits or assets of the Company upon
winding up of the Company. A Performance Right is not transferable.
e. Substantial Shareholders as at 31 August 2021.
Name Number of Ordinary % Held of Issued Ordinary
Fully Paid Shares Held Capital
Peters Investments Pty Ltd 129,621,485 30.24
Ben Collier Investments Pty Ltd <Ben Collier Investments Pty Ltd> 27,060,515 6.31
MAK Property Group Pty Ltd <MAK A/C> 25,690,547 5.99
Teldar Real Estate Pty Ltd <MJ Lahood Family A/C> 24,349,790 5.68
John Kolenda (Daring Investments) 21,998,109 5.13
f. Distribution of Shareholders as at 31 August 2021.
Category (size of holding) Total Holders Number % Held of Issued
Ordinary Ordinary Capital
1 – 1,000 214 35,898 0.01
1,001 – 5,000 115 319,070 0.07
5,001 – 10,000 108 831,197 0.19
10,001 – 100,000 358 14,235,195 3.32
100,001 – and over 201 413,154,556 96.41
996 428,575,916 100.00
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Additional Information for Listed Public Companies
g. Unmarketable Parcels as at 31 August 2021.
At the date of this report there were 424 shareholders who held less than a marketable parcel of shares, holding
1,056,265 shares.
h. On-Market Buy-Back
There is no current on-market buy-back.
i. Restricted Securities
The Company has no restricted securities
j. 20 Largest Shareholders — Ordinary Shares as at 31 August 2021.
Rank Name Number of Ordinary % Held of Issued
Fully Paid Shares Ordinary Capital
Held
1. Peters Investments Pty Ltd 129,621,485 30.24
2. Ben Collier Investments Pty Ltd <Ben Collier Investments P/L> 27,060,515 6.31
3. MAK Property Group Pty Ltd <MAK A/C> 25,690,547 5.99
4. Teldar Real Estate Pty Ltd <Mj Lahood Family A/C> 24,349,790 5.68
5. Semc 2 Pty Limited <The Chen Asset A/C> 17,475,530 4.08
6. Hanzheng Ksw Pty Ltd <Hanzheng KSW Unit A/C> 16,666,667 3.89
7. Daring Investments Pty Ltd 11,942,591 2.79
8. Daring Investments Pty Ltd <Kolenda Family A/C> 10,055,518 2.35
9. Honan Insurance Group Pty Ltd 7,692,308 1.79
10. Norfolk Enchants Pty Ltd <Trojan Retirement Fund A/C> 7,500,000 1.75
11. Dawney & Co Ltd 7,500,000 1.75
12. Mr Andrew Ernest Goodall 6,853,537 1.60
13. Nutsville Pty Ltd <Indust Electric Co S/F A/C> 6,763,230 1.58
14. Mr Irwin David Klotz 5,000,000 1.17
15. On Time Taxis Pty Ltd 4,886,026 1.14
16. Crossbay Pty Ltd 4,218,934 0.98
17. CS Fourth Nominees Pty Limited <HSBC Cust Nom Au Ltd 11 A/C> 3,724,913 0.87
18. BNP Paribas Nominees Pty Ltd grouped 3,518,429 0.82
19. Pritdown Pty Ltd <Mcdonald Super Fund A/C> 3,500,000 0.82
20. Martianne Pty Ltd <Crabb Family Invest No 2 A/C> 3,430,909 0.80
TOTAL 327,450,929 76.40
k. Unquoted Securities Holders Holding More than 20% of the Class as at 31 August 2021
◼ Unlisted Options (Exercise price $0.30, Expiry Date: 11.01.22)
Rank Name Number of % Held of Unquoted
Unquoted Securities Security Class
Mr Adam Stuart Davey <Shenton Park Investment A/C> 333,333 100.00
TOTAL 333,333 100.00
TOTAL UNLISTED OPTIONS (EXERCISE PRICE $0.30, EXPIRY DATE: 11.01.22) 333,333
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Additional Information for Listed Public Companies
◼ Performance Share Holders Ordinary Shares
Name Number of % Held of Unquoted
Unquoted Securities Security Class
Paul Niardone 411,112 26.43
Philip Re 344,445 22.14
TOTAL 755,557 48.57
TOTAL PERFORMANCE SHARES 1,555,558
2 The Company Secretary is Stuart Usher.
3 Principal registered office
As disclosed in note 23 Company details on page 73 of this Annual Report.
4 Registers of securities
As disclosed in the Corporate directory on page i of this Annual Report.
5 Stock exchange listing
Quotation has been granted for all the ordinary shares of the Company on all Member Exchanges of the Australian
Securities Exchange Limited, as disclosed in the Corporate directory on page i of this Annual Report.
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