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GLOBAL GROWTHBEYOND TECHNOLOGY

NEXBIS LIMITED (FORMERLY KNOWN AS ENTERTAINMENT, MEDIA & TELECOMS CORPORATION LIMITED)

Annual Report For The Year Ended 30 June 2009

ABN 81 071 275 253

www.nexbis.com.au

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Annual R

eport For The Year E

nded

30 June 2009

NEXBIS LIMITED

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MISSION

SECURITY

VISION

TRUST

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Nexbis Limited


CONTENT Performance Highlights

Chairman’s Report

Chief Executive Officer’s Report

Board of Directors

Corporate Structure

Company Overview

Community

Financials

Corporate Directory

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NEXBIS

ANNUAL GENERAL MEETING 2009 The Annual General Meeting will be held on Monday, 30 November 2009, commencing at 10.00 am, at the Christie Conference Centre, 3 Spring Street, Sydney CBD, Yangtze room, Mezzanine level.F

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PERFORMANCE HIGHLIGHTS

11.7

08

45.9

09

($m)

50

40

30

20

10

0

NPAT up 292%

11.0

4.0

08 09

(c)

12

10

8

6

4

2

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Earnings per share up 175%

26%

38%

08 09

(%)

50

40

30

20

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Return on Equity up to 38%

44.8

08 09

($m)

140

120

100

80

60

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Net Assets up 169%

120.59.2

11.9

08 09

Operating Cashflow up 29%

($m)

12

10

8

6

4

2

0

3.3

9.2

08 09

Cash at Bank up 179%

($m)

10

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6

4

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$m

Revenue

NPAT

Net Assets

Cash at Bank

Operating Cash Flow

EPS c

ROE %

2008

17.6

11.7

44.8

3.3

9.2

4.0

26%

2009

65.5

45.9

120.5

9.2

11.9

11.0

38%

% Growth

272%

292%

169%

179%

29%

175%

46%

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Nexbis LimitedAnnual Report For The Year Ended 30 June 2009

Group Chairman

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The financial year ended 30th June 2009 has been one of excellent performance for Nexbis in what has been one of the most challenging economic environments the technology industry has ever experienced.

A STRONG RESULT

I am pleased to report that Nexbis Limited has posted a record profit after tax of $45.9

million, up 292% from last year. This is a very strong performance and particularly

pleasing given the external conditions at play.

Earnings per share were up 175% to 11c from 4c in the previous year. The return on equity

for the group was 38%, up from 26% in the previous year.

Challenging times, however, also provide opportunities for strongly-positioned

businesses such as ours, so a great opportunity was realised in September 2008 when

Entertainment Media & Telecoms Corporation Limited (ETC) bought the remaining stake

in Nexbis Sdn Bhd. The importance of this acquisition is reflected in our company name

change from EMT to Nexbis as we are firmly of the belief that it is this technology which

will drive the future profitability of our business.

I am proud of the way Nexbis has navigated its way through these turbulent economic

conditions. The business reacted quickly to focus on cost management and priority

revenue-generating activities only in order to better address the new market realities.

This required some tough but necessary decisions including postponing several

non-core opportunities to shift resources to those areas with the best opportunity for

global development to enable our commitment to long term growth and achieving

shareholder return goals.

The strength of our balance sheet, the rise in earnings, and the uplift in earnings per share

is testament to that success. We continue to build our financial strength. This year we

have made significant progress in lifting our risk management practices to levels which

are advanced given the relative youth of our company. We remain committed to instilling

best practice across our operations and this will again be a major focus of the company

in the coming year.

Through this difficult period we have managed a seamless CEO transition from John

Houston to Johann Young. Johann has worked with John for years before the acquisition

of Nexbis, and his involvement in building the company from its inception with John has

ensured a very smooth transition. Johann will continue to build on John’s success in

executing our clear strategy to lead the way in mobile security technology, our disciplined

approach to new product development, and a heightened customer focus to deliver a

truly global and established business.

CHAIRMAN’S REPORT

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We will continue to look at ways to grow the business despite the challenging environment.

We will pursue additional opportunities with our existing customers while selectively growing

our business in new end-markets, building new capabilities and services, and selectively

targeting new customers. However, we will only pursue those revenue opportunities

supported by sustainable and acceptable returns, and we will be unwavering in this approach

to growth. Our focus will be on assembling the right team, systems, policies and

communications strategies which befit an ASX-listed company, and which will ensure Nexbis

continues to be well-positioned to capitalise on the growing demand in the markets in which

we operate.

OUR STRENGTH

Our strength lies in our people who are some of the most experienced and talented in the

field. Our senior management team is superb and continues to build on our leadership

position and deliver the long-term competitive advantage set out in our global vision. Over the

course of the year, we have successfully strengthened our teams in Asia and Europe, whilst

maintaining our cost base.

We are quite fortunate to have Johann Young succeed John Houston on his retirement. We

thank John for all his efforts to found the company and skillfully deliver ever impressive

results. I feel truly privileged to have joined the board as Chairman and will provide an

objective perspective in my non-executive role.

We will continue to build upon our already impressive talent to further strengthen the board

and management team to ensure we are well-positioned to capitalise on our growth

opportunities as our business evolves.

STRONGLY POSITIONED

Our low-risk balance sheet, with no gearing and strong cash position, will allow us to invest in

the most profitable opportunities available to us. It will also allow us to continue to recruit

some of the best talent available to further strengthen our management team. We will

continue to hold a prudent liquidity and balance sheet position, so that we are able to respond

quickly and appropriately to challenging market conditions and competitive environments.

NEXBIS ACQUISITION

One notable milestone of the past year has been the acquisition of Nexbis. This business has

a sustainable competitive advantage and will deliver exceptional value to our customers and

provide multiple streams of recurrent earnings. The wisdom of our decision to invest in the full

acquisition of Nexbis proved particularly strategic, given the strong revenues generated

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Dato’ IR (DR) Al Amin MajidChairman

during this financial year. In its first year the business generated $47 million in revenues,

which is 71% of group sales. Nexbis will be the key driver for the company’s future earnings

and success and so it made sense to change our name to Nexbis.

With full ownership of Nexbis, we expect to deliver exceptional shareholder value over the

long term and create a leading global technology solutions company.

LOOKING AHEAD

Whilst the global crisis has been the focus of events in the last year, there is renewed

confidence in the financial system from regulators which should assist consumer

confidence and boost general market sentiment. While there will no doubt be challenges

resulting from a slowdown in global growth, we are well- positioned to emerge from this

environment as a much stronger business.

Our Board wishes to thank our talented management team and employees for their

commitment and hard work on behalf of our customers. Their continued contribution in

what has been a very difficult year has been invaluable.

We also thank our customers around the world for choosing Nexbis as their partner of

choice.

Finally, on behalf of your board and management, I would like to thank you, our

shareholders, for your ongoing support and confidence during a demanding year. I am

pleased to report that we have delivered a strong result and are laying a solid foundation

for your company’s growth in the future.

Whilst pressures on government budgets and re-allocation of priorities may continue to

present short-term challenges, we are confident that we are transforming Nexbis into a

flexible, efficient and financially strong leader in our sector, well-positioned to capitalise on

the opportunities in our industry over the coming years.

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Nexbis Limited


Group Chief Executive Officer

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CEO’S REPORT

It is a privilege for me to report to you as Chief Executive Officer of Nexbis Limited in

what has been a pivotal year for our business. We have seen material changes in our

operating environment, our leadership, and strategic direction including the acquisition

of Nexbis. While we performed well in a very tough environment, my task remains that of

leading the business into the next phase of its life cycle. My key areas of focus are

creating a durable economic and competitive advantage, monetizing our existing

contracts, cash management, and diversifying our earnings base. We will continue to

add talent to our board, management team and front-line employees to offer the best

value to our customers and shareholders. We will also continue to improve investor

relations and communications to the market as befits a quality listed ASX company.

OPERATING ENVIRONMENT

As outlined by the Chairman, recent actions by governments and regulatory bodies have

begun to restore confidence in the financial system and improve the availability of credit.

However, a prolonged slowdown in growth globally is likely. This is already placing

budgetary pressures on governments, leading to a reprofiling of capital allocation

priorities which may present challenges to Nexbis. The consulting business globally is

experiencing pressure on fees as budget-constrained clients are reducing outsourced

workloads and demanding greater value for money. The environment will therefore be a

challenging one, and Nexbis will have to continue to be ready to react to such possible

changes. We believe we are well-resourced and positioned to manage such potential

changes.

PERFORMANCE

In a year where many companies have underperformed, we delivered a very strong

result. On the positive side, Nexbis posted a record profit after tax of $45.9 million, up

292% from last year’s figure of $11.7 million. Earnings per share were up 175% to 11c

from 4c in the previous year. The return on equity for the group was 38% in 2009, up

from 26% in the previous year. Our balance sheet was strong, with cash at bank

increasing from $3.2 million to $9.2 million, and our net assets increasing 169% from

$44.8 million to $120.5 million. Operating cash flow increased 29% from $9.2 million to

$11.9 million. We were particularly pleased with the contribution from our Chinese

business - a result which I believe demonstrates the enormous potential for Nexbis in

our newer markets.

However, despite these successes, we still have significant room for improvement on

several fronts, particularly on receivables management. Nexbis posted $65 million of

sales on its profit and loss and $42 million of receivables on its balance sheet. We will

be focusing on reducing trade receivables sharply over the coming year.

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Whilst operating cashflow increased 29%, this was considerably lower than our growth in

EBITDA and profit for the year. Again, this will be a key focus for improvement.

We have also been disappointed with the rate of rollout from our Malaysian contract. Changes

in senior leadership at the Ministry of Home Affairs, coupled with budgetary pressures causing

a short-term reallocation of priorities, have resulted in unanticipated delays beyond our control.

While we share investor frustration in fully converting this contract into cash flow, we are

confident that these are merely short-term teething pains and that the Malaysian contract will

create a strong recurring revenue stream for Nexbis with high barriers to exit.

The Consulting business has made a satisfactory performance in a very tough year for the

consulting industry around the world where pressure on fees is high. The business will continue

to focus on cost management and profitability in the coming year.

STRONG POSITIONING

Despite the market conditions and short-term issues with fully monetizing some of our key

contracts, our management team and Board remain extremely confident that the business is

well-positioned to create excellent returns over the long-term for our investors. Our

commitment to building a world-class technology company with a significant competitive

advantage and recurring revenue streams remains stronger than ever. Our management team

is enthusiastic, and focused on adding value to our customers and shareholders, which is

reflected in our high return on equity and strong earnings per share. We believe that our

technological advantage, client base, management team, and balance sheet strength position

us well to pursue opportunities in the coming year.

PEOPLE AND LEADERSHIP

As the new Chief Executive Officer, I will continue to strengthen our capabilities with the

addition of the highest calibre talent on our Board, management team and front-line employees

to support our ongoing business growth. I am delighted with the appointment of our new

experienced Chairman, who provides a separation from board and executive roles, and will

further strengthen our corporate governance and performance management. We will continue

to add appointments to the Board to increase its independence and breadth of experience.

Additionally, we will continue to expand our team in three key areas of our business: sales,

technology and financial control.

FULL AND FAIR DISCLOSURE

Above all, I will report events to shareholders in a candid, timely and transparent manner,

outlining both the positive developments and the challenges we face as the business develops

to allow shareholders to appraise business value. Rarely does a company like ours follow the

linear path of earnings growth often projected by many financial analysts. The nature of what

we do, and the new and emerging markets in which we work – with the corresponding cultural

and business nuances that entails - mean that opportunities present themselves which require

the company to maintain flexibility in responding quickly, while adopting a conservative

approach to accounting for the revenue streams these projects may deliver.

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However, whilst short-term fluctuations may occur, we are extremely confident in the growth

and sustainability of the earnings the business will generate in the medium-term, and, ultimately,

the excellent returns for our investors.

NEXBIS ACQUISITION

Strategically, the purchase of the remaining stake in Nexbis in September 2008 is extremely

important for the business. We believe Nexbis possesses world-class technology which, when

fully commercialised will create the key driver for shareholder value for our company. As such

we changed the name of the business from ETC to Nexbis to emphasise the change in the

dynamics of the value drivers. The technology is providing multiple applications in multiple

markets, creating a strong pipeline of contracts to drive the growth in profitability of the

business in the coming years.

OUTLOOK

While 2009 was our strongest year to date, 2010 will be challenging as the global economy deals

with the complexity of weaker demand and limited or reduced access to capital. As such, we will

not rest on our laurels but will vigorously pursue the key areas of continuous improvement I

discussed. From our perspective, the significant short-term earnings growth Nexbis achieved

was of lesser strategic importance than the excellent work the Board, management and

employees did to create a very strong platform for our business which will provide Nexbis with

a durable economic and competitive advantage. Nexbis is still a very young company and it has

come a long way since its inception. Looking ahead, the prospects for the business are much

greater than its achievements to date. We can see how multiple applications of our technology

can add real value to significant customers around the world to create a leading global

technology company.

Our primary focus is - and will continue to be - on building a company with long-term

competitive advantage. As tempting as it may be to acquiesce to the short-term demands of

some sections of the market, we will not compromise on our commitment to build a company

with a solid, sustainable future. We believe our relentless focus on operational excellence, a

continued strengthening of our governance and procedures, and our unwavering commitment

to our strategy and vision, will deliver exceptional shareholder value.

Our balance sheet strength, positioning, innovative technology and customer orientation will

continue to be areas of key competitive strength. Our fundamentals are sound, and we are

well-placed to take full advantage of the opportunities emerging from the crisis.

Dato’ Sri Johann Young

Group Chief Executive Officer

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Peter has over 15 years of experience in the technology

industry, advising some of Australia’s largest corporate

clients, including BHP Billiton, Boral and Telstra and also

small startup companies in respect of their Research and

Development and commercialisation efforts.!Peter is a

Fellow of the Tax Institute of Australia and has an

accounting/commerce degree. He spent a number of years

with KPMG, and was a founding member of KPMG’s

technology advisory practice in Melbourne and Sydney

before setting up his own very successful Technology

Consulting Firm. He is Nexbis’ Chief Financial Officer,

Company Secretary and is also an Executive Director.

PETER DYKESCHIEF FINANCIAL OFFICER

Colin has 40 years experience in media, importation &

telecommunications.!Colin’s experience has taken him

through roles in his native London to Australia, in sales,

marketing, business development and financial control.

Apart from his responsibilities as a non-executive director

of Nexbis, Colin also has several business interests and

performs a professional outsourced function for selected

clients as a financial controller.

COLIN TURNERNON-EXECUTIVE DIRECTOR

BOARD OF DIRECTORS

Johann has over 20 years of solid business, technical and

operational experience in the IT and Telecommunications

industry. He has successfully built IT Telecoms businesses

DATO’ SRI JOHANN YOUNGGROUP CHIEF EXECUTIVE OFFICER

Dato’ IR (Dr) Al Amin Majid qualified with a Diploma in

Technology from Oxford College of Further Education and

also holds a degree in Bachelor of Science in Civil

Engineering from University of Aston, Birmingham, United

Kingdom. He is also the Corporate Member of Institute of

Engineers (IEM), Malaysia and a Professional Engineer

(PE).

He has been active in both political and community work

since his early days. He was UMNO Youth Chief of Perak,

UMNO Youth Divisional Head of Pasir Pinji, Perak and

Umno Youth Exco Member during his active years in

politics. Dato’ IR (Dr) Al Amin Majid has served as the

Chairman of Chemical Industries Council of Malaysia

(CICM) from 1999 to 2009 and was Chairman of Asean

Chemical Industry Council from 1999 to 2001. He was

elected Co-Chair of APEC Chemical Dialogue,

representing the industry through Asia Pacific Chemicals

Industry Coalitions (APCIC) since 2000.

He is currently holding various positions in a few listed

companies, namely as Executive Chairman of Country

View Berhad, as Chairman of Nylex (M) Berhad and as

Director of Ancom Berhad and MCIS Zurich Insurance Sdn

Bhd. He was appointed Chairman of Small and Medium

Industries Development Corporation (SMIDEC), a

government agency under the Ministry of International

Trade and Industry – an important agency in the

development and enhancement of small and medium

enterprises in Malaysia since 2006.

Dato’ IR (Dr) Al Amin Majid is also the President of Aston

University Alumni Association of Malaysia which was

formed in 2007. He was recently conferred an Honorary

Doctorate Degree - Doctor of Science from Aston

University, UK.

DATO’ IR (DR) AL AMIN MAJIDGROUP CHAIRMAN

in Asia Pacific and Europe. He spent several years with

Orange and Hutchison including during the launch of

Orange PCS in the UK in 1994 and as Director of Asia for

Orange World; prior to which he was Launch Director of

Orange Thailand and was instrumental in the success of its

launch. Prior to Nexbis, Johann was COO of

docomointertouch. He has held several board positions

including in TA Orange, iNet, docomointertouch, GSL PLC

(HK) and sapio. He is a Business Finance graduate and

holds a Master of Science degree in Business Systems

Analysis and Design from City University of London.

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CORPORATE STRUCTURE

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sapioSweden

NEXBISHong Kong

Entertainment Media & TelcomsMalaysia

NEXBISAustralia

NEXBISMalaysia

Entertainment Media & TelcomsHong Kong

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COMPANY OVERVIEWNexbis Limited – NBS (formerly known as Entertainment, Media & Telecoms Corporation Limited, ETC), incorporated in Australia and publicly listed on the Australian Stock Exchange, is a leader in the development of applications which allow Enterprises and Governments to interact and transact over the Internet. Leveraging on over 12 years of Intellectual Property in mobile technologies, Nexbis today is a global leader in forensic level identity verification and enforcement technologies.

With our historical foundations in Europe, the birthplace of many of the world’s great mobile innovations, Nexbis has successfully reached out into Asia with innovative solutions increasingly focused on needs for National Security and consulting.

Nexbis’ forensic level 2D barcode based technology solutions are being adopted by Governments and Enterprises to address identity and document verification needs, with constant application innovations in areas of mobile communications security, asset and inventory management and mobile banking.

In addition, Nexbis offers end-to-end IT services from systems integration and implementation, software development to other areas of expertise such as project management, training, maintenance and support, and outsourcing.

OUR VISIONOur vision is to become a trusted partner to Governments worldwide in their pursuit to create a safer world for their citizens.

OUR MISSIONProviding Governments with forensic level, rapid-to-implement security solutions for document verification and enforcement capabilities.

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Nexbis Limited


NOTICE OF COMPANY NAME CHANGEEffective 10th August 2009, our company name has been changed from Entertainment Media & Telecoms Corporation Limited (ETC) to Nexbis Limited (NBS). This name change marks a continuous effort in streamlining our corporate identity with the core business. It should be noted that only a change of Company name has been effected and the structure of the Company remains the same.

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STRATEGIC COALITIONS

• International Partnerships

The central focus for Nexbis in 2009 has been global expansion. Hence, we have held talks with European countries, the US, China, Brunei and Middle East countries on collaboration opportunities in using our technology for national security improvement. As of yet, Europe and the US have shown great interest in the potential offered by NexCode™ for enforcement of security. Already, pacts have been signed with Thailand, Oman, the United Arab Emirates and Vietnam to provide NexCode™ security solutions to their government ministries and agencies.

• China National Gas Tank Project

Another notable achievement for 2009 has been the awarding of the unconditional Technology Licence Agreement (TLA) for the China National Gas Tank Project for the General Administration of Quality Supervision, Inspection and Quarantine of the People's Republic of China. Under the terms of this agreement, Nexbis will supply the NexCode™ Security Suite technology for the purpose of customer authentication for the China National Gas Tank Project for an initial five-year period, with an option for an additional five-year extension. An estimated 150 to 220 million individual purchasers of gas cylinders in China will expect to benefit from this NexCode™ identification card technology over the next five years.

AWARDED RECOGNITION

• The Asia Pacific ICT Awards (APICTA)

The International APICTA Annual Competition and Awards is a firmly established landmark event in the Information and Communication Technologies (ICT) calendar. It is Asia Pacific’s most prestigious and respected award competition in the ICT sector.

This past year, we were conferred the ‘Best of Security’ award in recognition of Nexbis National Security Solution contribution towards world-class national security, enforcement and identity management. This award comes just a month after we were named as the winner in the MSC Malaysia APICTA 2008.

With intense competition from countries across the entire region including countries such as Australia, Hong Kong, India, Indonesia, Vietnam, Korea, Malaysia and, Singapore, this APICTA win opens up tremendous endorsement, marketing and awareness opportunities backed by government promotion for us.

• World Summit Awards 2009

A global initiative to select and promote the best e-Content and innovative ICT applications in the world, the World Summit Awards (WSA) conducts a bi-yearly global contest to select best practice entries. It is part of the framework of the United Nations' World Summit on the Information Society (WSIS), initiated as a contribution to the global effort to bridge the digital divide and close the content gap. In 2009, we have been nominated and shortlisted for this prestigious award.

• Society for the Policing of Cyberspace (POLCYB)

The Society for the Policing of Cyberspace (POLCYB) was incorporated to enhance international partnerships among public and private professionals to prevent and combat crimes in cyberspace. Comprising an international network of practitioners from all organisational levels in the public and private sectors, POLCYB’s partners include professionals who work in the areas of law enforcement, criminal justice, corporate security, and academic institutions. As a testament to our expertise in the area of security, Nexbis was invited to be a member of POLCYB.

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Nexbis Limited

Annual Report For The Year Ended 30 June 2009 F

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PRODUCTS & SERVICES

NexCode™ National Security SuiteAn Integrated Approach to National Security

NexCode™ is designed to meet the increasing needs for forensic level identity authentication, document security, intra and inter-Government co-operation and enforcement, revenue assurance, fraud detection, crime prevention and various other scenarios requiring identi!cation enforcement by Governments.

With patents !led in 140 countries, NexCode™ is the most advanced platform of its nature for Governments today. Backed by an innovative and proprietary 2D code, NexCode™ is the only forensic level security solution that o"ers dynamic data retrieval from individual or networked databases. Besides providing identity and document security, NexCode™ improves enforcement e#ciency by allowing real-time information access, data security and unlimited data volumes.

With NexCode™, the depth of retrievable information is superior while breadth of surface information is minimal. This concurrently ensures highest levels of security and unlimited data volumes.

TECHNOLOGY

MOBILE

Technology Overview NexCode™ Technology

Patents !led in 140 countriesations

Enforcement DeviceNexCode™ National Security Suite only requires the use of an ubiquitous commodity as enforcement tools.

Terminal with camera

NexCode™ National Security Suite National Registration

ational Identity Authenticationational Registration Authentication

ation

ImmigrationPassport Authentication

ationForeign Work Permit AuthenticationForeign Student AuthenticationForeign Vehicle Entry Permit Authentication

PolicePolice Records Authentication

Road Transportation

Tax Sticker AuthenticationVehicle Registration Card AuthenticationVehicle Inspection Certi!cation Authentication

Commercial and CustomsPermit Authentication

Vehic ationTax Stamp Authentication

Property

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Business Partner

Ready for

with Linux

Systems

NexComm™ Secure SMS Solution

An application that takes Short Message Service

(SMS) up to the next level, NexComm™ is designed to

meet today’s high standards of mobile security.

NexComm™ allows SMS to be encrypted and sent

securely between mobile phones, ensuring highest

standards of security for confidential information.

Using a unique encryption key exchange system,

Governments and Enterprises can connect efficiently

without any risk. Being one of the few products of its

nature in the market, NexComm™ is set to create new

benchmarks for modern mobile security.

NexCode™ AccreditationNexCode™ Solution is Validated as Ready for IBM Systems with Linux

The NexCode™ solution is validated as Ready for IBM

Systems with Linux being one of only 259 products

worldwide which have received the prestigious mark

from IBM. Nexbis is given application assurance and

support from IBM porting the NexCode™ solution

across Linux platforms on any IBM specified hardware.

NexCode™ has also qualified to be added into IBM’s

Global Solutions Directory - this allows NexCode™

solutions to be easily referenced and looked up by

potential customers and business partners.

SOLUTION

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Annual Report For The Year Ended 30 June 2009 F

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NexWare™ Road Transport Solution

Designed to simplify and enhance e!ciency, control and processes involved in managing a highly complex backend platform with multiple systems running on numerous technologies, Nexbis enables a Government’s Road Transport Department to maximise its performance, manage its pool of resources and to retain full control of its data.

Through the NexWare™ Road Transport Solution, Nexbis addresses the primary needs and common operational challenges faced in the Road Transport sector to cater to vehicle, driver and road management. Communication between sub-systems, information delivery and exchange, real-time data computing, storage and retrieval of huge amounts of data are made easy and seamless for Governments. This enhances operational capability and manageability in today’s increasingly digital world. The "exibility and scalability of the solution allow easy deployment of new services whilst providing a platform for reliable and e!cient front-line road transport operations.

A complete end-to-end and customisable solution to ensure e!cient delivery of Road Transport services to the public, the combination of Nexbis proven systems technology and knowledge of the Road Transport industry enables Nexbis to deliver the maximum measurable results possible.

NexID™ National ID Management Solution

This product further testi#es Nexbis’ strength in providing an end-to-end national security solution for Governments. From the initial stage of creating and supplying ID cards to distributing (optional) and managing ID cards, Nexbis o$ers Governments a total one-stop solution for a nationwide, scalable ID management solution. NexID™ has evolved from a simple ID card production system with basic 34 Billion Permutation 2D Code embedded, to the latest formulated 562 Trillion Permutation 2D Code, equipped with the latest in covert and overt security technologies as well as security features depending on Governments’ requirements.

Nexbis understands the importance of the national ID card as the fundamental source of one’s identity and ultimately a national security concern. Therefore, Nexbis’ underlying technologies are designed and developed to meet international standards endorsed by the US Department of Homeland Security and federal identity protection standard conforming to Real ID Act of 2005. F

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Online Criminal Tracking (OCT) Solution

In recent years, the number of crimes has escalated to an alarming rate and given the situation, enforcement teams are facing challenges in apprehending these o!enders.

Acknowledging this as a serious national security threat and with objectives to raise enforcement operations standards and procedures, Nexbis has provided Governments with a solution that improves e"ciency in identifying and tracking down these o!enders. Online Criminal Tracking (OCT) Solution is designed to provide a platform that populates information of a suspected criminal anytime, anywhere over a secure channel. With a unique identi#cation of a formulated 2D Code on an Identity Document i.e. passport, driving licence, national ID and work permit, an o!ender with criminal record(s) would be easily identi#ed and subsequently held by enforcement o"cers for further actions.

Secure Asset and Inventory (SATIN) Management Solution

The SATIN Management Solution represents Nexbis’ ability to provide comprehensive asset and inventory management for Governments and Enterprises. An implementation of SATIN will greatly assist these entities by empowering clients with mobile and desktop based veri#cation tools which are fully encrypted and secure, thus ensuring information integrity at all times. The use of the everyday mobile phone as an asset veri#cation tool greatly simpli#es nationwide deployment to a large workforce while promoting mobility and ensuring cost-e!ectiveness.

Clients will also be empowered with the capability of complete control over asset management, service maintenance and procurement work$ows. With this solution, productivity and cost e!ectiveness would be enhanced. Furthermore, the functionality provided ultimately leads to more informed management decisions and the prevention of revenue leakage.

Secure Mobile Banking (SMB) Solution

Nexbis Secure Mobile Banking Solution is designed as an end-to-end solution for utility companies, banks and #nancial institutions through the integration of mobile banking features into existing legacy Over-The-Counter and Web banking systems.

Through Nexbis Secure Mobile Banking Solution, customers can engage in 2-way messaging mobile banking and payment services, ensuring improved e"ciency, e!ectiveness and competitive edge. Compatible across all major mobile phone providers and mobile user interfaces, this proprietary solution provides a complete range of mobile banking capabilities that caters to data integrity, high security and personalised round-the-clock service.

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Systems Integration and Implementation

Integration of computer systems, database management tools, and network con!gurations, along with a host of other issues, require signi!cant investments of time and expertise, which are typically unavailable during time of initial implementation.

Nexbis brings in a highly talented and dynamic team with 40 years of combined experience in knowledge and expertise required to solve the complex issues surrounding systems integration. With a solutions-oriented approach, Nexbis works to provide clients with results, not just simply technologies. From initial system design, Nexbis focuses on identifying solutions for long term strategies, systems, network and database requirements, which provide scalability, robustness and future-proof "exibility.

National Security Advisory Service

To govern a country is not an overnight, straightforward task but one which requires tremendous amounts of dedication and time in understanding the citizens and subsequently in making the country a better place to live in.

Being a global player and with accumulated number of years of experience, Nexbis o#ers to Governments around the world the team’s sound knowledge in national security. Nexbis understands each country has its di#erent needs and requirements, and hence Nexbis has adopted world-class practices on independent analysis and provides tailor-made strategies to its clients.

IT Consultancy

Nexbis o#ers consultancy services in programming, application and solutions development, as well as mobile content distribution involving JavaUnix, Visual C++ and system architecture. By working closely with clients, extensive !rst-hand knowledge of their businesses and needs are gained, hence allowing Nexbis to provide value-added service in areas of its core capabilities. Nexbis’ portfolio ranges from development to support at the same time, ensuring its clients achieve their objectives while controlling their risks. Regardless of the scale of the project, Nexbis o#ers comprehensive solutions that are customised according to every client’s speci!c needs.

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Software Services

Nexbis has extensive knowledge, understanding and experience of software development for a wide variety of platforms in numerous industry sectors. Nexbis is excited by the diversities and the challenges presented by constantly evolving IT technologies and applications.

Nexbis has a proven track record of delivering a comprehensive range of solutions for mobile workforces, Governments, photography services providers, logistics companies and non-governmental organisations.

As Nexbis works as an independent consultant and solutions provider, the team ensures applications are compatible with all requirements of IT platforms. The advantage of an application developed by Nexbis is that it will have a broader deployment than an application developed by an independent operator or hardware manufacturer. Nexbis creates the optimal solutions for its clients and uses its own platform, Mobile Provisioning Manager (MPM), to ensure end-users bene!t the most.

Nexbis Technology: Java, Symbian and iPhone

Nexbis possesses the skill to build applications that support both Java and Symbian, ensuring the best possible end-user experience.

Java - Sun’s Java Platform for mobile phones, Micro Edition (Java ME), provides a robust, "exible environment for applications running on mobile devices. Java ME includes "exible user interfaces, robust security, built-in network protocols, and support for networked and o#ine applications that can be downloaded dynamically. Applications based on Java ME are portable across many devices, yet leverage on each device's native capabilities.

Symbian - Symbian operating system is an open operating system for data-enabled mobile phones. It is designed for the speci!c requirements of 3G mobile phones and beyond. Symbian operating system combines the power of an integrated applications environment with mobile telephony, bringing advanced data services to the mass market. Symbian also delivers a scalable architecture that can be adjusted to meet the growing market.

iPhone - Nexbis is licensed to build applications for Apple’s iPhone touchscreen smartphone which has captured the attention of the market.

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Mobile Provisioning Manager (MPM)

MPM is Nexbis’ proprietary platform for the

distribution of mobile content. A user-friendly

graphic user interface enables Nexbis customers to

self-administer the downloading of content by their

users. Many of Nexbis’ solutions have the Mobile

Provisioning Manager platform (MPM) built in.

The features of the MPM platform that separate Nexbis

from its competitors and make the mobile content

provisioning and administration so attractive to its

customers are:

sapio Mobile Foundation Classes (SMFC)

The sapio Mobile Foundation Classes (SMFC) is a

set of software components which has been

created to provide an efficient and reliable platform

for mobile development.

Developers can employ SMFC to ensure their

applications are built reliably by reusing tested

components, whilst reducing development time.

SMFC provides the following features:

Project Management

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024

Training

Nexbis provides a full range of IT training services through innovative learning methods designed to improve performance and productivity of clients' businesses. Leveraging on real-life hands-on experience and business process expertise, Nexbis takes the time to understand clients' businesses and recommend and implement training programmes that align with their business objectives.

Through a team of experienced trainers, potential users are given comprehensive knowledge transfer and personalised attention to ensure performance optimisation. Modules are created objectively and arranged in creative and !exible ways to promote fast and e"cient learning. The key to Nexbis’ success has always been based on mobilising the right people, skills and technologies to help clients improve their performance.

Maintenance and Support

Nexbis provides maintenance and support services to customers before and after sales to ensure continuous customer relationships. The objectives of o#ering these services are to ful$l the implementation, delivery and completion of contracts and service level agreements secured, and to ensure the continuous operability of the systems. Nexbis Maintenance and Support team is entrusted with

the mandate to deliver outstanding customer services to its clients at all times. The services include:

Service Level Management - Develop comprehensive service-level de$nitions and metrics which cover hardware, software, services and systems performance Call Centre - Ensuring end-to-end service level measurements with customers are in place and updated in-line with the SLA Technical Support - Operational service provider on hardware related products OS/Network Support - Operational service provider on networking, operating platform and third party software Application Support - Operational service provider on application systems developed in-house

Outsourcing

Nexbis o#ers outsourcing services to allow its clients to focus on their core business. Be it upgrading of infrastructure, enhancing processes and procedures, minimising costs or strategic alliances for business development, Nexbis manages the complexity of its clients' IT solutions and ensures clients’ business objectives are achieved professionally and on time. A trusted partner to enhance clients’ overall business value, Nexbis takes care of their needs and mitigates the associated risks to put them ahead of their game.F

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MARKETING AND OPERATIONS EVENTS

200817th September 2008EMT authorised as an official partner of Sun Java Platform for mobile phone, a certified Java application.

15th October 2008Nexbis named as winner for APICTA 2008 Best of Security award.

3rd November 2008Nexbis National Security Suite showcased by Malaysian Government at DGICM* and AIIF* 2008 inter-government immigration conferences.

3rd November 2008Malaysian Minister of Home Affairs launches NexCode™ for the Immigration Department.

15th November 2008Nexbis named as winner for International APICTA 2008 Best of Security award.

17th November 2008Nexbis is granted POLCYB membership and invited to showcase National Security Suite at International Policing Cyberspace Summit 2008.

*DGICM - ASEAN Directors General of Immigration Departments and Heads of Consular Affairs Divisions of Ministries of Foreign Affairs.

*AIIF - ASEAN Immigration Intelligence Forum.

200926th January 2009Commencement of operations for Malaysian Operations and Support Centre.

26th January 2009Commencement of operations for Cyberjaya Contact Centre.

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CORPORATE EVENTS

026

MSC MALAYSIA APICTA 2008 Best of Security Award Winner15th October 2008

Nexbis was conferred The Best of Security award at the 9th MSC MALAYSIA APICTA (Asia Pacific ICT Award) 2008 held in Kuala Lumpur, Malaysia. The objective of the MSC Malaysia Asia Pacific ICT Awards (MSC Malaysia APICTA) is to provide recognition to outstanding achievements of individuals, students, entrepreneurs, SMEs and organizations with operations in Malaysia who have contributed to the development of the MSC Malaysia initiatives or in building applications and services for the benefit of Malaysia. It recognises creativity, innovation, and excellence in Malaysian ICT.

LAUNCH OF NEXCODE™ BY HOME MINISTER OF MALAYSIA3rd November 2008

NexCode™ National Security Solution for the Immigration Department of Malaysia was launched by Home Affairs Minister Datuk Seri Syed Hamid Albar. The Government regards the solution as a leaping step towards fighting identity document abuse and eradication of illegal immigrant related issues.

• The APICTA award presented to Dato’ Sri Johann Young during the award ceremony.

• Minister of Home Affairs Malaysia showing an I-Kad with NexCode.™

• Impressive unveiling of the NexCode™ solution

for the Malaysian Immigration Department.

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DGICM AND AIIF 2008 INTER-GOVERNMENT IMMIGRATION CONFERENCESInvitation by the Malaysian Government to showcase Nexbis National Security Suite3rd November 2008

In November 2008, we were invited by the Malaysian Government to showcase Nexbis National Security Suite at the ASEAN Directors General of Immigration Departments and Heads of Consular A!airs Divisions of Ministries of Foreign A!airs (DGICM) and ASEAN Immigration Intelligence Forum (AIIF) 2008.

INTERNATIONAL APICTA 2008Best of Security Award Winner15th November 2008

Nexbis was conferred The Best of Security, a top award at the 8th Asia Paci"c ICT Award (APICTA 2008) held in Jakarta, Indonesia. Competing against the likes Singapore, Pakistan, Australia, Hong Kong and Thailand, our team triumphed in the coveted Security category.Fresh from the success of the Malaysian APICTA awards, our team secured another

Best of Security Award at the international competition. In total, 138 entries were submitted from award-winning companies worldwide. Facing o! against the best of the best security solution award winners from each country, this victory is made even sweeter by the fact that no Malaysian-based solution has been awarded in this category for the past few years.

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028

2008.POLCYB SUMMIT 2008 Invitation to showcase National Security Suite at

International Policing Cyberspace Summit 200817th November 2008

Nexbis represented Malaysia at the 8th Annual Policing Cyberspace International Summit (POLCYB) 2008, where 100 senior officers from international governments, police forces, international security agencies and technology experts gathered. The key agenda was to discuss a collaborative measure for facilitating information sharing between government enforcement authorities, as well as public and private sectors in matters of information security, cyberspace crimes, identity theft, document fraud and privacy.

As the owner and inventor of the

award-winning NexCode™ National Security Solution, Nexbis was invited to lend its expertise on the area of national security. The event, aptly themed ‘Towards The Future of Global Cybersecurity: Raising the Bar on Collaboration’ was jointly hosted by the Royal Thai Police in collaboration with the Council of Europe. Held on November 17 to 21 in Bangkok, Thailand, Nexbis was given the opportunity to speak on ’Implications of Authentication Technologies Upon National Securities’ and ‘Convergence of Technologies and Emerging Technologies: Implications upon Cyber-security in Private and Public Sectors’. In addition, Nexbis was also invited to showcase the NexCode™ technology.

• Group picture of the POLCYB delegates

from various nations.

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029

COMMUNITYNexbis believes that beyond corporate achievements, our true value lies in giving back to society. On September 2008, we organised a CSR programme in conjunction with Hari Raya Aidilfitri. Held at Seri Perdana, Putrajaya the official residence of the Prime Minister of Malaysia, the open house was hosted to share the festive joy with orphans and VVIPs alike. In attendance were honorary guests such as the then-Prime Minister of Malaysia Yang Amat Berbahagia Tun Abdullah Hj. Ahmad Badawi, then-Home Affairs Minister of Malaysia Yang Berhormat Tan Sri Syed Hamid Albar and Dato’ Sri Johann Young CEO of Nexbis Sdn. Bhd. Dato’ Sri Johann Young.

As a measure of our commitment to society, Nexbis has donated to Yayasan Aminul Ummah. The cheque was presented by Datuk Seri Abdullah Badawi on behalf of the NGO in a cheque presentation ceremony during a breaking fast ceremony with the then-Prime Minister.

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Nexbis Limited

ABN 81 071 275 253

(formerly known as Entertainment Media & Telecoms Corporation Limited)

NEXBIS LIMITED

ABN 81 071 275 253

Financial Report for the Year Ended 30 June 2009


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ABN 81 071 275 253


CONTENTS

Corporate Directory 032

Corporate Governance Statement 033

Directors’ Report 040

Auditor’s Independence Declaration 052

Income Statements 053

Balance Sheets 054

Statements of Changes in Equity 055

Cash Flow Statements 058

Notes to the Financial Statements 059

Directors’ Declaration 093

Independent Auditor’s Report 096

Shareholders Information 098

This financial report covers both Nexbis Limited as an individual entity and the consolidated entity consisting of Nexbis Limited and its subsidiaries. The financial report is presented in the Australian currency.

Nexbis Limited is a company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is:

Level 40100 Miller StreetNorth SydneyNSW 2060

The financial report was authorised for issue by the Directors on 30 September 2009.

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CORPORATE DIRECTORY

032

DIRECTORSDatuk Mohamed Al Amin bin Abdul MajidDato’ Sri Johann YoungPeter DykesColin Turner

COMPANY SECRETARYPeter Dykes

REGISTERED OFFICELevel 40100 Miller StreetNorth SydneyNSW 2060

SHARE REGISTRYSecurity Transfer Registrars Pty Ltd770 Canning HighwayApplecrossWA 6153

AUDITORPKFLevel 101 Margaret StreetSydneyNSW 2000

SOLICITORS TO THE COMPANYMiddletonsLevel 2652 Martin PlaceSydneyNSW 2000

DeaconsGrosvenor Place225 George StreetSydneyNSW 2000

BANKERWestpac Banking Corporation181 Miller StreetNorth SydneyNSW 2060

STOCK EXCHANGE LISTINGThe Company’s shares are quoted on the Australian Stock Exchange under the code NBS.

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ABN 81 071 275 253


CORPORATE GOVERNANCESTATEMENT

033

INTRODUCTION

During the 2009 financial year the Company has undergone a significant amount of change that has necessitated management reviewing and updating revised control and reporting structures to align with the evolving business footprint and the better practice recommendations of the Australian Securities Exchange (ASX) Corporate Governance Council.

The Directors believe that good corporate governance is fundamental to the long term prosperity of Nexbis Limited. The Board continually reviews the Company’s governance practices to ensure that they promote sustainable value for shareholders and address the Company’s responsibilities to all of its stakeholders.

The Company is committed to implementing the highest possible standards of corporate governance and endeavours and that its practices are consistent with the Second Edition of the ASX Corporate Governance Council’s Principles and Recommendations wherever possible. Policies referred to within this statement have been published on the Company website http://www.nexbis.com.au.

1

1.1

Lay Solid Foundations for Management and Oversight

Board and Management Roles

The Board is responsible for the overall corporate governance of the Company and its subsidiaries. The responsibilities, in summary, include:

• Setting the strategic direction of the Company;

• Assignment of functions and responsibilities to the Board and senior executives;

• Developing, implementing and reviewing internal control and risk management policies, procedures and systems; and

• Establishing and monitoring the achievement of goals for the business operations and management.

The Board charter of the Company establishes and defines the functions of the Board including those functions which have been delegated to senior executives and the Chief Executive Officer (CEO). The CEO has been delegated the authority for the operations and the administration of the Company.

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ABN 81 071 275 253


Evaluation of Executive Performance

The Directors have decided not to appoint a Remuneration Committee due to the current scale and nature of the Company’s activities and the ‘flat’ organisational structure of the Company. The Board, however, actively researches appropriate remuneration levels for executives and senior employees.

Significant decisions, which include the remuneration of executives and senior employees, are generally made by all Board members at a Directors’ meeting. It is the Company’s objective to provide maximum stakeholder benefit from the retention of a high quality Board by remunerating Directors fairly and appropriately with reference to relevant market conditions. To assist in achieving this objective, the Board actively links the nature and amount of Directors’ emoluments to the Company’s performance.

Due to the small number of people in the senior executive and management team, each member is aware of the contribution, outputs and achievements of each team member. Consequently the need for a formal performance evaluation for each member of the team is not currently considered necessary. The approach to executive remuneration and performance is as follows:

• The performance of senior executives is set within the limitations imposed by shareholders and from an annual evaluation of the performance of each senior executive against agreed performance measures;

• There is no scheme to provide retirement benefits, other than statutory remuneration for Directors who are paid a salary;

• Non Executive Directors are remunerated by way of fees and are not entitled to participate in schemes available to the executives of the Company. The Non Executive Directors are not entitled to receive options or bonus payments; and

• Details of the remuneration of Directors and senior executives are contained in the Directors’ Report.

Structure the Board to Add Value

The Directors

The Constitution of Nexbis Limited sets the minimum number of Directors at three and has fixed the maximum number of Directors at nine. There are currently four Directors on the Board, two Executive Directors and two Non Executive Directors. A recent change to the Board has seen the introduction of an Independent Chairman as per ASX recommendation 2.2. However, the Company notes that it currently does not comply with ASX recommendation 2.1 as the majority of the Board is not independent. The Board has determined that due to the small size and complexity of the business the current Board is adequate although it intends to review the size and make up of the Board during the current financial year.

034

1.2

2

2.1

CORPORATE GOVERNANCE STATEMENT (continued)

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035

Independent Directors

The names of Independent Directors of the Company at the date of this report are:

• Datuk Mohamed Al Amin bin Abdul Majid, Chairman and Non Executive Director• Colin Turner, Non Executive Director

The Board considers independent decision-making as critical to effective corporate governance. Independent Directors are considered to be those who have the ability to exercise their duties and are not influenced or restricted by any business or other relationship. The independence of Non Executive Directors is assessed by the Board against the definition outlined in the Board charter.

Materiality thresholds

A Non Executive Director must meet the following thresholds:

• Less than 10% of the Company shares are held by the Director and any entity or individual directly or indirectly associated with the Director;

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

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

Right to seek professional advice

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


Datuk Mohamed Al Amin bin Abdul Majid


Peter Dykes

Colin Turner

Chairman and Non Executive Director

CEO and Executive Director

Chief Financial Officer (CFO), Company Secretary and Executive Director

Non Executive Director

Appointed 2009

Appointed 2008

Appointed 2000

Appointed 2006

Period of office held by each director as at the date of the financial report

2.2

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036

2.3

2.4

2.5

2.6


Chairman of the Board

The Chairman of the Board is elected by the Directors. The Chairman serves as the primary link between the Board and management, and works with the CEO and Company Secretary to set the agenda for Board meetings. It is the Chairman’s responsibility to provide leadership to the Board and ensure that the Board works effectively and discharges its responsibilities as Directors of the Company. The Chairman, Datuk Mohamed Al Amin bin Abdul Majid, is an Independent Non Executive Director and there is a clear division of responsibility between the Chairman and the CEO, Dato’ Sri Johann Young.

Appointment of Directors

New Directors are provided with formal letters of appointment that set out the key terms and conditions of their appointment. All Directors have access to Group information, senior management and employees as required enabling them to fulfill their responsibilities. In addition to management briefings at every Board meeting, Directors are regularly briefed on key business developments and matters material to their role as Directors. The appointment and removal of Directors is addressed in the Company’s Constitution.

Remuneration and Nomination Committee

The Directors have decided not to appoint either a Remuneration or a Nomination Committee due to the current scale and nature of the Company’s activities and the 'flat' organisational structure of the Company.

Subject to the provisions of the Company’s Constitution, the issues of Board composition and selection criteria for Directors are dealt with by the full Board. The Board continues to have the mix of skills and experience necessary for the conduct of the Company’s activities.

The Company’s Constitution provides for events whereby Directors may be removed from the Board. Similarly shareholders have the ability to nominate, appoint and remove Directors. In addition, the Constitution provides for the regular rotation of Directors which ensures that Directors seek re-election by shareholders at least once every three years. Given these regulatory requirements, Directors are not appointed for a specified term and Directors’ continuity of service is effectively in the hands of the shareholders.

Induction and Access to Information

When a new Director is appointed, the incumbent Directors actively engage in providing the new Director with information on the financial position, strategies, policies and procedures of the Company. Access to information on a regular basis is provided for as follows:

• Board and Committee papers will be circulated to Directors prior to each Board and Committee meeting. Directors are expected to undertake adequate preparation to permit their effective contribution at each meeting;

• At each Board meeting, Non Executive Directors will be given the opportunity to meet without management present;

• Proceedings of all meetings are minuted, circulated to all members of the Board, amended as required and, when signed by the Chairman of the meeting is the definitive record of the proceedings of meetings held; and

• Minutes of all Board meetings are circulated to Directors and approved by the Board at the subsequent meeting.

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037

3

3.1

3.2

4

4.1


Promote Ethical and Responsible Decision Making

Code of Conduct

As part of its commitment in recognising the legitimate interests of stakeholders, the Company has established a Code of Conduct to guide compliance with legal and other obligations to stakeholders. These stakeholders include employees, clients, customers, government authorities, creditors and the community as a whole. This Code also includes a securities trading policy. A copy of the Code of Conduct is published on the Company website.

Securities Trading

Directors and employees will be aware that the Corporations Act imposes substantial criminal penalties, including imprisonment, for insider trading. The definition of insider trading in essence prohibits insiders, such as directors and employees, from trading in the stock when they possess non-public, price sensitive information relating to the company and its affairs. It also prohibits those insiders from passing on that information to third parties (including other employees, family, friends and others). If the third party uses that information to deal in shares or options, both the third party and the insider passing on the information commit offences under the Corporations Act.

The Company has set a policy regarding Directors and employees trading in its securities. The policy restricts Directors and employees from acting on material information until it has been released to the market and adequate time has been given for this to be reflected in the securities’ prices.

To assist Directors and employees in their dealings in the Company’s shares, the Board of Directors recommends that the following guidelines be observed i.e. no Director or employee should deal in the Company’s shares during the following periods:

• Preceding the release of its interim results (February);• Preceding the release of its preliminary results (August); and• During any other period designated by the Board or the CEO as a 'black-out period'.

Safeguard Integrity in Financial Reporting

Audit and Compliance Committee

The Board has established an Audit and Compliance Committee which operates under a charter approved by the Board. It is the Board’s responsibility to ensure that an effective internal control framework exists within the Company to deal with the effectiveness and efficiency of business processes, the safeguarding of assets, the maintenance of proper accounting records and the reliability of financial information.

The Board has delegated the responsibility for the establishment and maintenance of the internal controls framework and ethical standards to the Audit and Compliance Committee.

The Committee Chair regularly meets with the CFO to ensure that Committee members are kept regularly informed of key issues and also meets with the external auditor, without members of management present, as deemed appropriate.

The Audit and Compliance Committee charter is available on the Company website.

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038


4.2

5

6

7

7.1

Audit and Compliance Committee Structure

Mr. Colin Turner was the Chairman of the Audit and Compliance Committee during the 2009 financial year. He has extensive background in Sales, Marketing and Financial Management.

There were four meetings held during the financial year.

In July 2009, the Company Chairman, Mr. John Houston joined the Committee until his resignation from the Company in August 2009. The current Chairman, Datuk Mohamed Al Amin bin Abdul Majid is now a member of the Committee.

The Company is currently not in compliance with ASX recommendation 4.3 as the Audit and Compliance Committee does not have at least three members that are both non executive and also independent. The Board determined that it was not practical to appoint additional members to this Committee during the 2009 financial year that would allow it to satisfy this recommendation. The Board intends to review the make up of the Audit and Compliance Committee in the current financial year.

Make Timely and Balanced Disclosure

The Company has established a Continuous Disclosure Policy that has been published and made available on the Company website.

The Annual Report includes a review of operations that are required under ASX listing rule 4.10.17.

Respect the Rights of Shareholders

The Company makes a point of making regular ASX announcements to provide progress updates in statutory reports. Shareholders who have disclosed email contact details are emailed Company announcements and encouraged to contact the Board members with any queries.

The Company has in place a Shareholder Communication Policy to support its intentions on communications. The Company has established a corporate website i.e. http://www.nexbis.com.au.

Recognise and Manage Risk

Risk Management Policies

The Board has published a risk management policy that encompasses the ASX Corporate Governance Best Practice guidelines and the AUS/NZ 4360 Risk Management standard. The Audit and Compliance Committee use this approach in their identification and assessment of key business risks.

The Board is committed to effectively managing operational, financial and other risk in the context of the business strategies of the Company with a view to achieving a balance between acceptable levels of risk and reward. The Board recognises that risk management is a responsibility of all operating levels of the business and thus a risk management policy and process involves all key personnel, with appropriate reporting structures to the Board.

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039


7.2

8

The types of risks which may be faced by the Company can include strategic, operational market, financial and reporting and the Company has established a system of risk oversight and management to identify, assess, monitor and manage risks.

Risk Management Activities

The Board oversees, reviews and monitors risk on a regular basis and at least half yearly, or in the case of escalated and high priority risks, quarterly. The Board receives reports and key issues that have been escalated from the Audit and Compliance Committee. The Audit and Compliance Committee is charged with overseeing the management of all business risks across the Company with a view to ensuring that mitigating actions are performed and overall risk to the Company is within the agreed risk appetite. The Board considers that business risks are actively identified and managed with appropriate risk mitigation strategies and approaches deployed that are in alignment with the nature and scale of the Nexbis Limited operations. The Board has received assurance from the CEO and the CFO that the Corporations Act section 295A declaration is founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to financial reporting risks. The declaration was dated 2 September 2009.

Remunerate Fairly and Responsibly

This principle is covered in paragraphs 1.2 and 2.5.

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ABN 81 071 275 253


DIRECTORS’ REPORT

Your Directors present their report on the consolidated entity (referred to hereafter as the Group) consisting of Nexbis Limited and the entities it controlled at the end of or during the financial year ended 30 June 2009.

DIRECTORS

The following persons were Directors of Nexbis Limited during the financial year and up to the date of this report:

The Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.

COMPANY SECRETARY

The Company Secretary is Peter Dykes. Mr. Dykes was appointed to the position of Company Secretary in 2007.

PRINCIPAL ACTIVITIES

The principal continuing activities of the Group during the financial year were:

• the provision of mobile application development consulting services;

• the development of mobile applications which allow enterprises and Governments to interact and transact over the mobile internet; including forensic level identity verification and enforcement technologies which operate securely over mobile devices; and

Names Appointed/Resigned


John Houston


Peter Dykes

Colin Turner

Non Executive Chairman (appointed 21 August 2009)

Non Executive Chairman (resigned 21 August 2009)

Executive Director

Executive Director


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DIRECTORS’ REPORT (continued)

• the development and commercialisation of forensic level, 2D barcode based technology solutions for Governments to address identity and document verification needs.

REVIEW OF OPERATIONS

The consolidated profit after providing for income tax and eliminating minority equity interests amounted to $45,896,000 (2008: $11,651,000). During the reporting period, Entertainment Media And Telcoms Sdn Bhd acquired the remaining 32.34% of Nexbis Sdn Bhd. Nexbis Sdn Bhd is now a wholly owned subsidiary of Nexbis Limited.

DIVIDENDS PAID OR RECOMMENDED

During and since the year to 30 June 2009 there has not been any dividend or distribution reinvestment plan in operation. No dividends were paid or made payable during the year to 30 June 2008.

FINANCIAL POSITION

The net assets of the Group have increased by $75,683,000 since 30 June 2008 to a net asset position of $120,465,000 at 30 June 2009.

SIGNIFICANT CHANGES IN STATE OF AFFAIRS

The following are significant changes in the Group’s state of affairs occurred during the financial year:

• On 6 August 2008, Nexbis Sdn Bhd signed a letter of Intent with the Road Administration Department of Vietnam in respect of the replacement of the current drivers licence using the NexCode product offering;

• On 17 September 2008, the Company issued 55,000,000 shares at 40.0 cents per share to institutional investors raising $22.0M;

• On 30 September 2008, Entertainment Media And Telcoms Sdn Bhd acquired a further 32.34% of Nexbis Sdn Bhd for $19.4M;

• On 22 October 2008, Nexbis Sdn Bhd signed a Memorandum of Understanding with the Road Administration Department of Vietnam in respect of the replacement of the current drivers licence using the NexCode product offering;

• On 17 November 2008, Nexbis Sdn Bhd signed a Technlonogy Licence Agreement to supply the NexCode security suite for the China National Gas Tank project for China Inspection True Product Technology Ltd (CITP) (formerly known as General Administration of Quality Supervision, Inspection and Quarantine) in the People’s Republic of China;

• Printing of NexCodes cards for the China National Gas Tank project commenced in April 2009; and

• On 12 June 2009, the Company issued a total of 30,000,000 executive/employee options exercisable at 50 cents per share, vesting immediately and expiring on 30 June 2010.

041

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042


EVENTS AFTER BALANCE SHEET DATE

On 24 July 2009, the executive/employee options issued on 12 June 2009 were cancelled and replaced with a new issue of 20,000,000 options exercisable at between $0.75 cents and up to $1.50 per share, which vest over three years up to 1 July 2012 and expiring over four years up to 30 June 2013.

On 10 August 2009, Entertainment Media & Telecoms Corporation Limited changed its name to Nexbis Limited.

On 21 August, Mr. John Houston resigned as Non Executive Chairman and was replaced by Datuk Mohamed Al Amin bin Abdul Majid.

FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES

Other than as noted previously within this report, the Directors have excluded from this report any further information on the likely developments in the operations of the Group and the expected results of those operations have not been included in this financial report because the Directors believe it would be likely to result in unreasonable prejudice to the Group.

ENVIRONMENTAL ISSUES

The economic entity has determined that there is no particular or significant environmental legislation which is relevant to it operations.

DIRECTOR INFORMATION

Datuk Mohamed Al Amin bin Abdul Majid | Non Executive Chairman

Experience

Other Current Directorships

Former Directorships in the Last Three Years

Special Responsibilities

Interest in Shares and Options

Datuk Al Amin has extensive experience in business and corporate management which includes serving as the current Executive Chairman of Country View Berhad and Chairman of Nylex (Malaysia) Berhad, both of which are publicly listed on the Malaysian Stock Exchange. He has also held long serving positions as Chairman for Zurich Insurance (Malaysia) Berhad since 1989.

He is also Chairman of the Small & Medium Industries Development Corporation (SMIDEC) in Malaysia and was formerly the Chairman of the Chemical Industries Council of Malaysia (CICM) where he was extensively involved in initiatives at the regional APEC level.

Ancom BerhadGabongan Pemborong Bumiputra Perak Berhad

SCAN Associates Berhad

Member of the Audit and Compliance Committee

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043


Dato’ Sri Johann Young | Chief Executive Officer

Experience





Dato’ Sri Johann has over 20 years of solid business, technical and operational experience in the IT and Telecoms industry.

He has successfully built an IT services business in Asia Pacific from start-up to multi-million dollar revenue before selling it off to a European PLC. He spent several years with Orange and Hutchison, including during the launch of Orange PCS in the UK in 1994, and was Director of Asia for Orange World prior to which he was Launch Director of Orange Thailand.

He is a founding shareholder of Vispac Telecom in China which started in 2001 and is today’s largest Service Provider for China Unicom in the Guangdong region with revenue exceeding RMB 200 per annum.

Prior to Nexbis Limited, he was COO of interTouch and helped build its operations from a medium-size broadband service provider to one of the largest service providers with operations in 40 countries. He has held several board positions including in TA Orange, iNet, interTouch and GSL PLC (HK).

Not Applicable

Not Applicable

Not Applicable

8,800,000 Ordinary Shares in Nexbis Limited

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044



Peter Dykes | Chief Financial Officer & Company Secretary

Colin Turner | Non Executive Director

Experience

Experience









Peter has over 15 years of experience in the technology industry, advising some of Australia’s largest corporate clients, including BHP Billiton, Boral and Telstra and also small startup companies in respect of their research and development, and commercialisation efforts.

Peter is a Fellow of the Tax Institute of Australia and has an accounting/commerce degree. He spent a number of years with KPMG, and was a founding member of KPMG’s technology advisory practice in Melbourne and Sydney.

Colin is a Non Executive Director and Chairman of the Audit and Compliance Committee. Colin has over 15 years of experience in the telecommunications business and has a background in sales, marketing and financial management.

Not Applicable

Not Applicable

Not Applicable

Not Applicable

Not Applicable

Chairman of the Audit and Compliance Committee

6,540,000 Ordinary Shares and 1,200,000 options in Nexbis Limited

1,013,334 Ordinary Shares in Nexbis Limited

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045


MEETINGS OF DIRECTORS

During the financial year 28 meetings of Directors (including committees of Directors) were held. Attendances by each Director during the year were as follows:

*The Audit and Compliance Committee meetings were also attended by the Group auditors, PKF.

REMUNERATION REPORT

This report details the nature and amount of remuneration for each Director of Nexbis Limited and subsidiaries, and for the executives receiving the highest remuneration.

REMUNERATION POLICY

The objective of the Group’s executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with achievement of strategic objectives, creation of value for shareholders and conformity with market practice for delivery of reward. The Board ensures that the executive reward satisfies the following key criteria for good reward governance practices:

• competitiveness and reasonableness;• acceptability to shareholders;• performance linkage;• transparency; and• capital management.

John Houston


Peter Dykes

Colin Turner

28

28

28

28

1

-

-

4

28

28

28

28

1

-

-

4

Directors Name Directors’ Meetings

Number eligible to attend

Number attended Number eligible

to attendNumber attended

Committee Meetings

Audit and Compliance Committee*

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046


Details of Remuneration for the Year Ended 30 June 2009

The remuneration for each Director and each of the five executive officers of the Company receiving the highest remuneration during the year was as follows:

DIRECTORS’ REMUNERATION

John Houston


Peter Dykes

Colin Turner

John Houston


Peter Dykes

Geoffrey Milne

Colin Turner

291,216

250,004

225,000

120,000

886,220

416,801

223,468

20,833

120,000

17,500

35,000

$

$

$

$

$

$

$$

$$

$

$

$$

$$

$ %

$ %

838,254

750,004

780,473

120,000

2,488,731

1,012,402

533,219

20,833

405,850

17,500

35,000

65%

67%

71%

-

-

-

58%

-

70%

-

-

454,584

500,000

500,000

-

1,454,584

500,000

250,000

-

250,000

-

-

92,454

-

55,473

-

147,927

95,601

59,751

-

35,850

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Short term benefits

Short term benefits

Cash, salary &

commissions

Cash, salary &

commissions

Bonus

Bonus

Options

Options

Options

Options

Equity

Equity

Equity

Equity

Post employment

benefits

Post employment

benefits

Other long term benefits


Share basedpayments

Share basedpayments

Total

Total

Performance related

Performance related

2009

2008

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047

KEY MANAGEMENT PERSONNEL COMPENSATION

Dan Dumitrescu

Yu Ye Chua

Mikael Kinnunen

Peter Fang

Benjamin Cheong

Dato' Sri Johann Young

Dan Dumitrescu

Mikael Kinnunen

Yu Ye Chua

Benjamin Cheong

Eric Lau

311,406

129,011

122,500

102.421

88,247

753,585

748,033

110,256

332,842

116,554

94,427

70,713

23,241

$

$

$

$

$

$

$$

$$

$

$

$$

$$

$ %

$ %

811,406

129,011

122,500

102.421

93,962

1,259,300

998,033

360,256

332,842

116,554

94,427

70,713

23,241

0%

0%

0%

0%

6%

-

-

69%

0%

0%

0%

0%

0%

-

-

-

-

5,715

5,715

250,000

250,000

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

500,000

-

-

-

-

500,000

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Short term benefits

Short term benefits

Cash, salary &

commission

Cash, salary &

commission

Bonus

Bonus

Options

Options

Options

Options

Equity

Equity

Equity

Equity

Post employment

benefits

Post employment

benefits



Share basedpayments

Share basedpayments

Total

Total

Performance related

Performance related

2009

2008

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ABN 81 071 275 253


048


SERVICE AGREEMENTS

The Board believes that individual salary negotiation is more appropriate than formal remuneration policies, and external advice and market comparisons are sought when necessary. The Board recognises that the attraction and retention of high calibre executives is critical to generating shareholder value.

Details of Executive Directors’ contracts are as below:

Dato' Sri Johann Young

• Term of agreement – on-going commencing 1 June 2008

• Base salary for the year ended 30 June 2009 of $250,000

• Minimum bonus of $500,000 and $750,000 for the year ended 30 June 2010 and 30 June 2011 respectively

• Any bonus above the minimum contract bonus are determined at the Board’s discretion and are referenced to targets to be met by the employee and the creation of value to shareholders

• Termination notice by either party is 12 months

Peter Dykes

• Term of agreement – on-going commencing 1 July 2008


• Minimum bonus of $225,000 and $275,000 for the year ended 30 June 2010 and 30 June 2011 respectively

• Any bonus above the minimum contract bonus are determined at the Board’s discretion and are referenced to targets to be met by the employee and the creation of value to shareholders

• Termination notice by either party is 12 months

The Board policy is to remunerate Non Executive Directors at market rates for time, commitment and responsibilities. The Board determines payments to Non Executive Directors and reviews their remuneration annually, based on market price, duties and accountability. Independent external advice is sought when required. Fees for Non Executive Directors are not linked to the performance of the Group. However to align Directors’ interests with shareholder interests, the Directors are encouraged to hold shares in the Group. On appointment to the Board, all Non Executive Directors enter into a service agreement with the Company in the form of a letter of appointment. The letter summarises the Board policies and terms, including compensation relevant to the office of Director.

Each member of the executive team has signed a formal contract at the time of their appointment covering a range of matters including their duties, rights and responsibilities and any entitlements on termination. The standard contract sets out the specific formal job description.

The salary and emoluments paid to executives shall be approved by the Board.

All contracts with executives may be terminated early by either party with three to six months notice, subject to termination payments as detailed below:

Executive Vice President, Strategy and Planning – Yu Ye Chua

• Term of agreement – on-going commencing 15 November 2006


• Payment of a termination benefit on early termination by the Company other than for gross misconduct equal to three months base salary

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049

OPTIONS HELD BY DIRECTORS

On 30 January 2008, the Company issued a total of 32,000,000 director options (20,000,000 options issued to John Houston and 12,000,000 options issued to Peter Dykes).

Peter Dykes’ options are exercisable as follows:

- 6,000,000 pre consolidation (1,200,000 post consolidation) were exercisable at 10 cents per share pre consolidation (50 cents per share post consolidation) on 1 December 2008;

- 6,000,000 pre consolidation (1,200,000 post consolidation) are exercisable to 15 cents per share pre consolidation (75 cents per share post consolidation on 1 December 2009; and

- The options vest and expire on the same day.

As at 30 June 2009, John Houston's options are exercisable as follows:

- 10,000,000 pre consolidation (2,000,000 post consolidation) were exercisable at 10 cents per share pre consolidation (50 cents per share post consolidation) on 1 December 2008;

- 10,000,000 pre consolidation (2,000,000 post consolidation) are exercisable to 15 cents per share pre consolidation (75 cents per share post consolidation on 1 December 2009; and

- The options vest and expire on the same day.

Pursuant to John Houston’s resignation on 21 August as Non Executive Chairman, the 2,000,000 options held as at 30 June 2009 were cancelled.

INDEMNITY OF AUDITORS

During or since the end of the financial year the Company has not given any indemnity or entered into an agreement to indemnify the auditors.

PROCEEDINGS ON BEHALF OF THE COMPANY

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.



Peter Dykes

Colin Turner

-

-

2,400,000

-

-

-

1,200,000

-

-

-

1,200,000

-

-

-

-

-

-

-

-

-

Balance at 30 June 2008

Options granted

Options converted

Options expired


Director of Operations – Benjamin Cheong

• Term of agreement – on-going commencing 11 December 2006


• Payment of a termination benefit on early termination by the Company other than for gross misconduct equal to three months base salary

Director of Software Services – Peter Fang

• Term of agreement – on-going commencing 17 March 2008


• Payment of a termination benefit on early termination by the Company other than for gross misconduct equal to six months base salary

Mikael Kinnunen and Dan Dumitrescu resigned during the year.

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Nexbis Limited

ABN 81 071 275 253


Directors and key management

Employee share plan

Total

6,400,000

-

2,000,000

-

8,400,000

$0.75

$0.20

$0.175

$0.50

30 January 2008

16 March 2009

14 May 2008

12 June 2009

5,200,000

-

-

-

5,200,000

5,200,000

-

970,000

30,000,000

32,170,000

-

2,500,000

-

30,000,000

32,500,000

-

2,500,000

1,030,000

-

3,530,000


Exerciseprice

Issuedate

Options granted

Options converted

Options expired/

cancelled


050


OPTIONS

At the date of this report, there are 32,170,000 un-issued Ordinary Shares of the Company under options. Details of the unexercised options are listed below:

6,400,000 2,500,000 2,500,000 5,200,000 5,200,000

2,000,000 - 30,970,00030,000,000 1,030,000

The following fees for non-audit services were paid/payable to the external auditor during the year ended 30 June 2009:

Taxation servicesOther services

11,667 7,420

19,087

$

NON-AUDIT SERVICES

The Board of Directors, in accordance with advice from the Audit and Compliance Committee, is satisfied that the provision of non-audit services by external auditors during the year is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the services disclosed below did not compromise the external auditor’s independence for the following reasons:

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

• The nature of the services provided do not compromise the general principles relating to auditor independence.

On 24 July 2009, the executive/employee options issued on 12 June 2009 were cancelled and replaced with a new issue of 20 million options exercisable at between $0.75 cents and up to $1.50 per share, which vest over three years up to 1 July 2012 and expiring over four years up to 30 June 2013.

The 970,000 options issued under the employee share plan expire on 30 June 2011.

The weighted average share price during the year was $0.35 cents.

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ABN 81 071 275 253



AUDITOR’S INDEPENDENCE DECLARATION

The lead auditor’s independence declaration as required under section 307C of the Corporations Act 2001 for the year ended 30 June 2009 has been received and can be found on page 52 of the financial report.

ROUNDING OF AMOUNTS

The Company is of a kind referred to in Class order 98/100 issued by the Australian Securities and Investment Commission. Amounts in the Directors’ Report have been rounded to the nearest thousand dollars, or in certain cases, to the nearest dollars.

AUDITOR

PKF continue in office in accordance with section 327 of the Corporations Act 2001.

Signed in accordance with a resolution of the Board of Directors.

Peter DykesDirector

Dated this 30th day of September 2009

051

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To the Directors of Nexbis Limited

As lead auditor for the audit of Nexbis Limited for the year ending 30 June 2009, I declare that, to the best of my knowledge and belief, there have been:

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

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

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

PKF

Bruce GordonPartner

Sydney, 30 September 2009

Tel: 61 2 9251 4100 | Fax: 61 2 9240 9821 | www.pkf.com.au PKF | ABN 83 236 985 726 Level 10, 1 Margaret Street | Sydney | New South Wales 2000 | Australia DX 10173 | Sydney Stock Exchange | New South Wales

The PKF East Coast Practice is a member of PKF Australia Limited a national association of independent chartered accounting and consulting firms each trading as PKF. The East Coast Practice has offices in NSW, Victoria and Brisbane. PKF East Coast Practice is also a member of PKF International, an association of legally independent chartered accounting and consulting firms.

Liability limited by a scheme approved under Professional Standards Legislation

052

AUDITOR’S INDEPENDENCE DECLARATION

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053

Revenue

Revenue

Other income

Expenses

Employee expense

Occupancy expense

Marketing & administration expense

Write down of intangibles

Amortisation

Depreciation

Option expense

Other expenses

Results from operating activities

Profit/(loss) before income tax expense

Income tax expense

Profit/(loss) after income tax expense

Profit/(loss) for the period

Loss attributable to minority interests

Profit/(loss) attributable to members

of the Group

EARNINGS PER SHARE

Basic profit per share (cents per share)

Diluted profit per share (cents per share)

The above income statements should be read in conjunction with the accompanying notes.

4

5

6

7

-

5,129

(3,154)

(65)

(1,332)

-

-

-

(4,879)

(74)

(4,375)

(4,375)

-

(4,375)

(4,375 )

-

(4,375)

-

-

-

1,604

(1,957)

(51)

(1,210)

-

-

-

-

-

(1,614)

(1,614)

-

(1,614)

(1,614)

-

(1,614)

-

-

65,558

154

(5,874)

(767)

(3,537)

(764)

(3,768)

(54)

(4,879)

(284)

45,785

45,785

-

45,785

45,785

111

45,896

11.0

10.9

17,630

111

(3,470)

(190)

(2,603)

-

-

(36)

-

(11)

11,431

11,431

-

11,431

11,431

220

11,651

4.0

4.0

Parent EntityConsolidated

2009

$000 $000

2008

$000 $000

2009 2008

Note

INCOME STATEMENTSFOR THE YEAR ENDED 30 JUNE 2009

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054

Assets

Current Assets

Cash and cash equivalents

Trade and other receivables

Other current assets

Total Current Assets

Non Current Assets

Plant and equipment

Intangible assets

Financial assets

Total Non Current Assets

Total Assets

Liabilities

Current Liabilities

Trade and other payables

Total Current Liabilities

Non Current Liabilities

Total Liabilities

Net Assets

Equity

Contributed equity

Retained profits/(accumulated losses)

Option reserve

Option - Other

Foreign currency translation reserve

Parent Entity Interest

Minority Equity Interest

Total Equity

The above balance sheets should be read in conjunction with the accompanying notes.

12

13

14

15

16

17

20

21

22

24

25

23

26

826

-

37

863

-

-

61,046

61,046

61,909

2,305

2,305

-

2,305

59,604

81,260

(26,063)

4,407

-

-

59,604

-

59,604

1,019

-

89

1,108

-

-

37,990

37,990

39,098

968

968

-

968

38,130

59,735

(21,806)

201

-

-

38,130

-

38,130

9,207

42,009

514

51,730

1,715

66,136

6,157

74,008

125,738

5,273

5,273

-

5,273

120,465

81,260

37,597

4,407

-

(2,799)

120,465

-

120,465

3,276

2,787

155

6,218

335

42,705

-

43,040

49,258

4,476

4,476

-

4,476

44,782

59,735

(8,417)

201

(5,471)

(2,831)

43,217

1,565

44,782


2009

$000 $000

2008

$000 $000

2009 2008

Note

BALANCE SHEETSAS AT 30 JUNE 2009

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055Consolidated Entity

2009

Balance at 1 July 2008

Exchange differences on translation of

foreign operations recognised directly in

equity

Profit for the year

Total recognised income and expense

for the year

Contributed equity

Disposal of interest by Minority Interests

Employee share options – value of services

Adjustment for expired options

Options exercised

Transaction costs


The above statements of changes in equity should be read in conjunction with the accompanying notes.

59,735

-

-

-

22,180

-

-

-

555

(1,210)

21,525

81,260

STATEMENTS OF CHANGES IN EQUITYFOR THE YEAR ENDED 30 JUNE 2009

(8,417)

-

45,896

45,896

-

-

-

118

-

-

118

37,597

(2,831)

32

-

32

-

-

-

-

-

-

-

(2,799)

201

-

-

-

-

-

4,879

(118)

(555)

-

4,206

4,407

(5,471)

-

-

-

-

-

-

-

5,471

-

5,471

-

43,217

32

45,896

45,928

22,180

-

4,879

-

5,471

(1,210)

31,320

120,465

1,565

-

(111)

(111)

-

(1,454)

-

-

-

-

(1,454)

-

44,782

32

45,785

45,817

22,180

(1,454)

4,879

-

5,471

(1,210)

29,866

120,465

Ordinary Shares

$000

RetainedProfits/

AccumulatedLosses)

$000

Foreign Currency

Translation Reserve

$000

Option Reserve

$000

Option – Other

$000

Total

$000

Minority Interest

$000

Total

$000

Attributable to the members of Nexbis Limited

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056

Consolidated Entity

2008

26,864

-

-

-

33,999

-

-

-

(1,128)

32,871

59,735

(20,068)

-

11,651

11,651

-

-

-

-

-

-

(8,417)

(10)

(2,821)

-

(2,831)

-

-

-

-

-

-

(2,831)

-

-

-

-

-

-

201

-

-

201

201

-

-

-

-

-

-

-

(5471)

-

(5,471)

(5,471)

6,786

(2,821)

11,651

8,830

33,999

-

201

(5471)

(1,128)

27,601

43,217

-

-

(220)

(220)

-

1,785

-

-

-

1,785

1,565

6,786

(2,821)

11,431

8,610

33,999

1,785

201

(5,471)

(1,128)

29,386

44,782

Attributable to the members of Nexbis Limited


Exchange differences on translation of foreign operations recognised directly in equity

Profit for the year

Total recognised income and expense for the year

Contributed equity

Minority Interests on acquisition of subsidiary


Option to acquire remaining interests in subsidiary

Transaction costs


Ordinary Shares

$000

Accumulated Losses

$000

Foreign Currency

Translation Reserve

$000

Option Reserve

$000

Option – Other

$000

Total

$000

Minority Interest

$000

Total

$000

STATEMENTS OF CHANGES IN EQUITY (continued)


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Parent Entity

2009


Loss for the year

Total recognised expense for the year

Contributed equity


Adjustment for expired options

Options exercised

Transaction costs


Ordinary

Shares

$000

59,735

-

-

22,180-

-

555

(1,210)

21,525

81,260

Accumulated

Losses

$000

(21,806)

(4,375)

(4,375)

--

118

-

-

118

(26,063)

Option

Reserve

$000

201

-

-

-4,879

(118)

(555)

-

4,206

4,407

Total

$000

38,130

(4,375)

(4,375)

22,1804,879

-

-

(1,210)

25,849

59,604

Parent Entity

2008


Loss for the year

Total recognised expense for the year

Contributed equity

Employee share options – value of

services

Transaction costs


Ordinary

Shares

$000

26,864

-

-

33,999

-

(1,128)

32,871

59,735

Accumulated

Losses

$000

(20,192)

(1,614)

(1,614)

-

-

-

-

(21,806)

Option

Reserve

$000

-

-

-

-

201

-

201

201

Total

$000

6,672

(1,614)

(1,614)

33,999

201

(1,128)

33,072

38,130

057

STATEMENTS OF CHANGES IN EQUITY (continued)


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058

Cash flows from operating activities

Receipts from customers(inclusive of goods and services tax)

Payments to suppliers and employees (inclusive of goods and services tax)

Interest received

Net cash provided by/(used in) operating activities

Cash flows from investing activities

Payment for purchase of Nexbis Sdn Bhd

Payment for purchase of non-current assets

Loans granted to other entity

Payment for acquisition of patents and intellectual property rights

Loans granted to subsidiaries

Repayment of loan to a subsidiary

Receipt from acquisition of business

Others

Net cash used in investing activities

Cash flows from financing activities

Proceeds from issue of shares

Net cash provided by financing activities

Net increase/(decrease) in cash held

Net foreign exchange differences

Cash at 1 July 2008

Cash at 30 June 2009

29

19

21

-

(2,994)

47

(2,947)

(502)

-

-

-

(11,235)

(11)

-

-

(11,748)

14,579

14,579

(116)

(77)

1,019

826

-

(3,191)

92

(3,099)

-

(750)

-

-

(22,682)

-

-

(23,432)

18,154

18,154

(8,377)

-

9,396

1,019

20,875

(9,062)

54

11,867

(13,220)

(1,398)

(6,157)

(48)

-

-

-

5

(20,818)

14,764

14,557

5,813

118

3,276

9,207

15,676

(6,585)

92

9,183

(26,859)

(1,018)

-

(5,702)

-

-

508

(4)

(33,075)

18,154

18,154

(5,738)

(669)

9,683

3,276


2009

$000 $000

2008

$000 $000

2009 2008

Note

CASH FLOW STATEMENTSFOR THE YEAR ENDED JUNE 2009

The above cash flow statements should be read in conjunction with the accompanying notes.

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059

NOTES TO THEFINANCIAL STATEMENTFOR THE YEAR ENDED 30 JUNE 2009

1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of the financial report are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. The financial report includes separate financial statements for Nexbis Limited as an individual entity and the consolidated entity consisting of Nexbis Limited and its subsidiaries.

Basis of Preparation of Accounts

This general purpose financial report has been prepared in accordance with Australian equivalents to International Financial Reporting Standards (AIFRS), other authoritative pronouncements of the Australian Accounting Standards Board, Australian Accounting Interpretations and the Corporations Act 2001.

Compliance with International Financial Reporting Standards (IFRS)

The financial report of Nexbis Limited also complies with IFRS as issued by the International Accounting Standards Board (IASB).

Historical cost convention

These financial statements have been prepared under the historical cost convention as modified by the revaluation of available for sale assets, financial assets and liabilities at fair value through profit and loss, certain classes of plant and equipment and investment.

Critical accounting estimates

The preparation of financial statements in conformity with AIFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity or areas where assumptions and estimates are significant can be found in Note 3.

Functional and presentation currency of the Group

The Directors of the Company consider the functional currency to be Australian Dollars.For

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(A) PRINCIPLES OF CONSOLIDATION

Subsidiaries

The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Nexbis Limited as at 30 June 2009 and the results of all subsidiaries for the year then ended. Nexbis Limited and its subsidiaries together are referred to in this financial report as the Group or the consolidated entity.

Subsidiaries are all those entities (including special purpose entities) over which the Group has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity.

Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group (refer note 1 (h)). The Group applies a policy of treating transactions with minority interests as transactions with parties external to the Group. Disposals to minority interests result in gains and losses for the Group that are recorded in the income statement. Purchases from minority interests result in goodwill, being the difference between the consideration paid and the relevant share acquired of the carrying value of identifiable net assets of the subsidiary.

Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Minority interests in the results and equity of subsidiaries are shown separately in the consolidated income statement and balance sheet respectively. Investments in subsidiaries are accounted for at cost in the individual financial statements of Nexbis Limited.

(B) COMPARATIVE FIGURES

When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.

(C) PLANT AND EQUIPMENT

Each class of plant and equipment is carried at historical cost or fair value less, where applicable, any accumulated depreciation and impairment losses. Historical cost includes expenditure which is directly attributable to the acquisition of the item.

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 that will be received from the assets employment and subsequent disposal. The expected net cash flows are discounted to their present values in determining recoverable amounts.

An asset’s carrying amount is written down immediately to its recoverable amount if the assets carrying amount is greater than its estimated recoverable amount. Gains and losses on disposal are determined by comparing the proceeds with carrying amount. Gains and losses are recognised in the income statement.

Leasehold improvements are amortised over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.

060

NOTES TO THE FINANCIAL STATEMENT (continued)

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061

Plant and equipment is depreciated over 3 to 20 years on a straight line basis.

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.

(D) INVESTMENTS AND OTHER FINANCIAL ASSETS

Classification

The Group classifies its financial assets in the following categories: financial assets at fair value through profit or loss, loans and receivables, held-to maturity investments and available-for-sale financial assets. The classification depends on the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition and, in the case of assets classified as held-to-maturity, re-evaluates this designation at each reporting date.

(i) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term.

(ii) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for those with maturities greater than 12 months after the reporting date which are classified as non-current assets. Loans and receivables are included in trade and other receivables and receivables in the balance sheet.

(iii) Held to maturity investments

Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Group’s management has the positive intention and ability to hold to maturity. If the Group were to sell other than an insignificant amount of held-to-maturity financial assets, the whole category would be tainted and reclassified as available-for-sale. Held-to-maturity financial assets are included in non-current assets, except for those with maturities less than 12 months from the reporting date, which are classified as current assets.

(iv) Available-for-sale financial assets

Available-for-sale financial assets, comprising principally marketable equity securities, are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within 12 months of the reporting date. Investments are designated as available-for-sale if they do not have fixed maturities and fixed or determinable payments and management intends to hold them for the medium to long term.

Measurement

Loans and receivables and held-to-maturity investments are carried at amortised cost using the effective interest method.

Available-for-sale financial assets and financial assts at fair value through profit and loss are carried at fair value. Gains or losses arising from changes in the fair value of the financial assets at fair value through profit or loss category are presented in the income statement within other income or other expenses in the period in which they arise. Dividend income from financial assets at fair value through profit and loss is recognised in the income statement as part of revenue from continuing operations when the Group’s right to receive payments is established.


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Changes in the fair value of monetary securities denominated in a foreign currency and classified as available-for-sale are analysed between translation differences resulting from changes in amortised cost of the security and other changes in the carrying amount of the security. The translation differences related to changes in the amortised cost are recognised in profit or loss and other changes in carrying amount are recognised in equity. Changes in the fair value of other monetary and non-monetary securities classified as available-for-sale are recognised in equity.

Details on how the fair value of financial instruments is determined are disclosed in note 2.

Impairment

The Group assesses at each balance date whether there is objective evidence that a financial asset or group of financial assets is impaired. In the case of equity securities classified as available-for-sale, a significant or prolonged decline in the fair value of a security below its cost is considered as an indicator that the securities are impaired. If any such evidence exists for available-for-sale financial assts, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss - is removed from equity and recognised in the income statement. Impairment losses recognised in the income statement on equity instruments classified as available-for-sale are not reversed through the income statement. If there is evidence of impairment for any of the Group’s financial assets carried at amortised cost, the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows, excluding future credit losses that have not been incurred. The cash flows are discounted at the financial asset’s original effective interest rate. The loss is recognised in the income statement.

(E) INTANGIBLE ASSETS

Goodwill

Goodwill and goodwill on consolidation are initially recorded at the amount by which the purchase price for a business or for an ownership interest in a subsidiary exceeds the fair value attributed to its net assets at date of acquisition. Goodwill on acquisition of subsidiaries is included in intangible assets. Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

Goodwill is allocated to cash generating units for the purpose of impairment testing.

Computer software

Costs incurred in acquiring software and licenses that will contribute to future period financial benefits through revenue generation and/or cost reduction are capitalised to software and systems. Costs capitalised include external direct costs of materials and service, direct payroll and payroll related costs of employees’ time spent on the project. Amortisation is calculated on a straight-line basis over 5 years.

Patents and intellectual property rights

Patents and Intellectual Property Rights have a finite useful life and are carried at cost less accumulated amortisation and impairment losses. Amortisation is calculated on a straight-line basis over 5 years.

062


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063

NexCode contract rights

The NexCode contract rights represent Entertainment Media And Telcoms Sdn Bhd’s entitlement to the revenue generated by Nexbis Sdn Bhd through servicing contracts with the Malaysian government involving the NexCode software. These rights are carried at cost and less accumulated amortisation and impairment losses and amortised on a straight line basis over 5 years.

NexCode proprietary technology rights

NexCode proprietary technology rights have a finite useful life and are carried at cost less accumulated amortisation and impairment losses. Amortisation is calculated on a straight-line basis over 5 years.

(F) SHARE-BASED PAYMENTS

The Group operates a number of share based compensation plans. These include both a share option arrangement and an employee share scheme. The fair value of instruments issued is recognised as an expense in the income statement. The total amount to be expensed over the vesting period is determined by reference to the fair value of the shares or the options granted.

(G) PROVISIONS

Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.

(H) BUSINESS COMBINATIONS

The purchase method of accounting is used to account for all business combinations regardless of whether equity instruments or other assets are acquired. Cost is measured as the fair value of the assets given, shares issued or liabilities incurred or assumed at the date of exchange plus costs directly attributable to the acquisition. Where equity instruments are issued in an acquisition, the value of the instruments is their published market price as at the date of exchange. Transaction costs arising on the issue of equity instruments are recognised directly in equity.

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the income statement, but only after a reassessment of the identification and measurement of the net assets acquired.

Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.

AASB 3 permits adjustments to items recognised in the original accounting for a business combination, for a maximum of one year after the acquisition date, where new information about facts and circumstances existing at the acquisition date is obtained. Any such adjustments are made retrospectively as if those adjustments had been made at the acquisition date.


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( I ) INCOME TAX

The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the national income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to the temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements, and attributable to unused tax losses.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amount in the consolidated financial statements. However the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss.

Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the reporting date and are expected to apply when the related deferred income tax assets is realised or the deferred income tax liability settled.

Deferred tax assets are recognised for the deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in subsidiaries where the parent entity is able to control the timing of the reversal of the temporary difference and it is probable that the differences will not reverse in the foreseeable future.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.

Nexbis Limited is not a member of a tax consolidated group.

(J) IMPAIRMENT OF ASSETS

Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment or more frequent if events or changes in circumstances indicate that they might be impaired. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that they might be impaired.

An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units). 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 on a pro rata basis.

The recoverable amount of an asset or cash generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted using a pre-tax discount rate that reflects the time value of money and the risks specific to the asset.

064


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065

Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

In this regard, and despite there being no indicators of impairment, Management engaged an independent professional and qualified valuer, Covenant Equity Consulting Sdn Bhd, to assess whether these was any impairment in respect of the NexCode Proprietary Technology rights as at 30 June 2009. They concluded that the recoverable amount of this asset exceeds the carrying amounts and that there is therefore no impairment in respect of this asset. Covenant Equity Consulting Sdn Bdn used forecasts prepared by management and a PE valuation method to value Nexbis Sdn Bhd and the intangible assets it holds.

(K) RECEIVABLES

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 between 30 to 90 days. Collectability of trade receivables is reviewed on an ongoing basis.

Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectable are written off by reducing the carrying amount directly. An allowance account (provision for impairment of trade receivables) is used when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation and default or delinquency in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired. The amount of the impairment allowance is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate.

Cash flows relating to short-term receivables are not discounted if the effect of discounting is immaterial. The amount of the movement in the provision is recognised in the income statement.

The amount of the impairment loss is recognised in the income statement within other expenses when a trade receivable which an impairment allowance had been recognised becomes uncollectable in a subsequent period it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against other expenses in the income statement.

(L) TRADE AND OTHER PAYABLES

Trade and other payables represent liabilities for goods and services provided to the Group prior to the end of financial year which had not been settled at balance date. The amounts are unsecured and are usually paid within 30 days of recognition.

(M) ROUNDING OF AMOUNTS

The Company is of a kind referred to in Class order 98/100 issued by the Australian Securities and Investment Commission. Amounts in the Directors’ Report have been rounded to the nearest thousand dollars, or in certain cases, to the nearest dollar.


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(N) REVENUE

Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances and duties and taxes paid.

Revenue from the sale of goods, specifically NexCode comprising of Nexbis’ National Security Suite, is recognised upon the delivery of goods to customers.

Revenue from the rendering of consulting services and maintenance is recognised upon the delivery of the service to the customers. Revenue received in relation to maintenance contracts is initially credited to deferred income and is then recognised on a straight line basis.

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

(O) SEGMENT REPORTING

A business segment is a group of assets and operations engaged in providing products or services that are subject to risks and returns that are different to those of other business segments. A geographical segment is engaged in providing products or services within a particular economic environment and is subject to risks and returns that are different from those of segments operating in other economic environments.

(P) EARNINGS PER SHARE

Basic earnings per share

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

Diluted earnings per share

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

(Q) FOREIGN CURRENCY TRANSLATION

Functional and presentation currency

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The consolidated financial statements are presented in Australian dollars, which is Nexbis Limited’s functional and presentation currency.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement, except when they are deferred in equity as qualifying cash flow hedges and qualifying net investment hedges or are attributable to part of the net investment in a foreign operation.

066


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067

Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. Translation differences on non-monetary assts such as equities classified as available-for-sale financial assets are included in the fair value reserve in equity.

Group companies

The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

• assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet; • income and expenses for each income statement are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transactions dates, in which case income and expenses are translated at the date of the transactions); and• all resulting exchange differences are recognised as a separate component of equity.

On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other financial instruments designated as hedges of such investments, are taken to shareholders’ equity. When a foreign operation is sold or any borrowings forming part of the net investment are repaid, a proportionate share of such exchange differences are recognised in the income statement, as part of the gain or loss on sale where applicable.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entities and translated at the closing rate.

(R) NEW ACCOUNTING STANDARDS AND INTERPRETATIONS

Certain new accounting standards and interpretation have been published that are not mandatory for 30 June 2009 reporting periods. The standards and interpretations described below are only the new standards and interpretations applicable to the Group and not all newly published standard and interpretation. The Group’s and the parent entity’s assessment of the impact of these new standards and interpretations is set out below.

AASB 8 Operating Segments and AASB 2007-3 Amendments to Australian Accounting Standards arising from AASB 8 (effective from 1 January 2009)

AASB 8 will result in a significant change in the approach to segment reporting, as it requires adoption of a ‘management approach’ to reporting on financial performance. The information being reported will be based on what the key decision makers use internally for evaluation segment performance and deciding how to allocate resources to operating segments. The Group will adopt AASB 8 from 1 July 2009. It is likely to result in an increase in the number of reportable segments presented. In addition, the segments will be reported in a manner that is more consistent with the internal reporting provided to the chief operation decision-maker. As goodwill is allocated by management to groups of cash-generating units on a segment level, the change in reportable segment may also require a reallocation of goodwill. However, this is not expected to result in any impairment of goodwill.

Revised AASB 123 Borrowing Costs and AASB 2007-6 Amendment to Australian Accounting Standards arising from AASB 123 (effective from 1 January 2009)

The revised AASB 123 has removed the option to expense all borrowing costs and - when adopted – will require the capitalisation of all borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset. There will no be no impact on the financial report of the Group, as the Group has no borrowings.


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Revised AASB 101 Presentation of Financial Statements and AASB 2007-8 Amendments to Australian Accounting Standards arising from AASB 101 (effective from 1 January 2009)

The September 2009 revised AASB 101 requires the presentation of a statement of comprehensive income and makes changes to the statement of changes in equity, but will not affect any of the amounts recognised in the financial statements. If an entity has made a prior period adjustment or has reclassified items in the financial statements, it will need to disclose a third balance sheet (statement of financial position), this one being as at the beginning of the comparative period. The Group will apply the revised standard form 1 July 2009.

AASB 2008-1 Amendments to Australian Accounting Standard – Share-based Payments: Vesting Conditions and Cancellations (effective from 1 January 2009)

AASB 2008-1 clarifies that vesting conditions are service conditions and performance conditions only and that other features of a share-based payment are not vesting conditions. It also specifies that all cancellations, whether by the entity or by other parties, should receive the same accounting treatment. The Group will apply the revised standard from 1 July 2009, but it not expected to affect the accounting for the Group’s share-based payments.

Revised AASB 3 Business Combinations, AASB 127 Consolidated and Separate Financial Statements and AASB 2008-3 Amendments to Australian Accounting Standards arising from AASB 3 and ASASB 127 (effective 1 July 2009)

The revised AASB 3 continues to apply the acquisition method to business combinations, but with some significant changes. For example, all payments to purchase a business are to be recorded at fair value at the acquisition date, with contingent payments classified as debt subsequently remeasured through the income statement. There is a choice on an acquisition-by acquisition basis to measure the non-controlling interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets. All acquisition-related costs must be expenses. This is different to the Group’s current policy which is set out in note 1(j) above.

The revised AASB 127 requires the effects of all transactions with non-controlling interests to be recorded in equity if there is no change in control and these transactions will no longer result in goodwill or gains and losses. The standard also specifies the accounting when control is lost. Any remaining interest in the entity is remeasured to fair value, and a gain or loss is recognised in profit or loss. This is consistent with the Group’s current accounting policy.

The Group will apply the revised standards prospectively to all business combinations and transactions with non-controlling interests from 1 July 2009.

AASB 2008-6 Further Amendments to Australian Accounting Standards arising from the Annual Improvements Project (effective 1 July 2009)

The amendments to AASB 5 Discontinued Operations and AASB 1 First –Time Adoption of Australian –Equivalents to International Financial Reporting Standards are part of the IASB’s annual improvements project published in May 2008. They clarify that all of a subsidiary’s assets and liabilities are classified as held for sale if a partial disposal sale plan results in loss of control. Relevant disclosures should be made for this subsidiary if the definition of a discontinued operation is met. The Group will apply the amendments prospectively to all partial disposals of subsidiaries from 1 July 2009.

068


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Nexbis Limited

ABN 81 071 275 253


069

AASB 2008-7 Amendments to Australian Accounting Standards – Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate (effective 1 July 2009)

In July 2008, the AASB approved amendments to AASB 1 First-time Adoption of International Financial Reporting Standards and AASB 127 Consolidated and Separate Financial Statements. The Group will apply the revised rules prospectively from 1 July 2009. After that date, all dividends received from investments in subsidiaries, jointly controlled entities or associates will be recognised as revenue, even if they are paid out of pre-acquisition profits, but the investments may need to be tested for impairment as a result of the dividend payment. Under the entity’s current policy, these dividends are deducted form the cost of the investment. Furthermore, when a new intermediate parent entity is created in internal reorganisations it will measure its investment in subsidiaries at the carrying amounts of the net assets of the subsidiary rather than the subsidiary’s fair value. There is no impact on the Group’s financial statements.

AASB Interpretation 16 Hedges of a Net investment in a Foreign Operation (effective 1 October 2008)

AASB-16 clarifies which foreign currency risks qualify as hedged risk in the hedge of a net investment in a foreign operation and that hedging instruments may be held by any entity or entities with the Group. It also provides guidance on how an entity should determine the amounts to be reclassified from equity to profit or loss for both the hedging instrument and the hedged item. The Group will apply the interpretation prospectively from I July 2009. There is no impact on the Group’s financial statements.

AASB 2008-8 Amendment to IAS 39 Financial Instruments: Recognition and Measurement (effective 1 July 2009)

AASB 2008-8 amends AASB 139 Financial Instruments: Recognition and Measurement and must be applied retrospectively in accordance with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors. The amendment makes two significant changes. It prohibits designating inflation as a hedgeable component of a fixed rated debt. It also prohibits including time value in the one-sided hedged risk when designating options as hedges. The Group will apply the amended standard from1 July 2009. There is no impact on the Group’s financial statements.

AASB Interpretation 17 Distribution of Non-cash Assets to Owners and AASB 2008-13 Amendment to Australian Accounting Standards arising from AASB Interpretation 17

AASB 17 applies to situations where an entity pays dividends by distributing non-cash assets to its shareholders. These distributions will need to be measured at fair value and the entity will need to recognise the difference between the fair value and the carrying amount of the distributed assts in the income statement on distribution. This is different to the Group’s current policy which is to measure distributions of non-cash assets at their carrying amounts. The interpretation further clarifies when a liability for the dividend must be recognised and that it is also measured at fair value. The Group will apply the interpretation prospectively from 1 July 2009. There is no impact on the Group’s financial statements.


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2 FINANCIAL RISK MANAGEMENT

The Group’s activities expose it to a variety of financial risks; market risk (including currency risk, interest rate risk and price risk), credit risk, liquidity 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.

Risk management is carried out by the board of Directors and senior management under policies approved by the Board of Directors and based on information provided internally to management. The Board provides principles for overall risk management, as well as written policies covering specific areas, such as mitigating foreign exchange, interest rate and credit risks, use of derivative financial instruments and investing excess liquidity.

The Group and the parent entity hold the following financial instruments:

Financial assets



Financial assets – non current


Financial liabilities


826

-

61,046

37

61,909

2,305

2,305

1,019

-

37,990

89

39,098

968

968

9,207

42,009

6,157

514

57,887

3,079

3,079

3,276

2,787

-

155

6,218

4,476

4,476


2009

$000 $000

2008

$000 $000

2009 2008

Market risk

(i) Foreign exchange risk

Foreign exchange risk arises when future commercial transactions and recognised assets and liabilities are denominated in a currency that is not the entity’s functional currency. The Group operates internationally and is exposed to foreign exchange risk arising from currency exposures primarily to the Malaysian Ringgit, US Dollars and Swedish Kroner.

At 30 June 2009 the Group had the following exposure to foreign currency that is not designated in cash flow hedges:

The carrying amounts of the parent entity's financial assets and liabilities are denominated in Australian dollars.

Financial assets



Financial assets – non current




174

88

-

20

282

187

187

1,902

2,750

-

8

4,660

3,345

3,345

8,075

36,656

6,157

-

50,888

-

-

132

5,265

-

457

5,854

587

587

30 JUNE 200830 JUNE 2009

USD

$000 $000

RM

$000 $000

SEK RM

354

37

-

30

421

173

173

$000

SEK

070


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071

Group Sensitivity Analysis

The following sensitivity analysis is based on the foreign currency rate risk exposures in existence at the balance sheet date. The sensitivity analysis is based on economic conditions which are reasonably probable at the balance sheet date.

At 30 June 2009, if the exchange notes moved, as illustrated in the table below, post tax profit and equity would have been affected as follows:

Malaysian Ringgit (RM)

AUD / RM +10%

AUD / RM -10%

Swedish Kroner (SEK)

AUD / SEK +10%

AUD / SEK -10%

US Dollars (USD)

MYR / USD +10%

MYR / USD -10%

6,849

(5,604)

10

(8)

5,093

(5,093)

132

(132)

25

(25)

-

-

6,231

(5,098)

65

(80)

6,185

(6,185)

132

(132)

25

(25)

-

-

Equity

Higher/(Lower)

Net Profit

Higher/(Lower)

2009

$000 $000

2008

$000 $000

2009 2008

Judgements of reasonably probable movements:

The movements in profit are more sensitive than 2008 due to additional operations in Malaysia. The Board decided not to hedge the foreign currencies due to the cost of hedging involved, timing of payments from customers and the volatile currency movements.

The Group’s exposure to other foreign currencies movements is not material.

Parent Entity Sensitivity Analysis

The parent entity’s financial report is presented in Australian currency and its exposure to foreign exchange movements is not material.

(ii) Price riskNeither the Group nor the parent entity is exposed to commodity or other price risk.

(iii) Cash flow and fair value interest rate riskThe Group’s main interest rate risk arises from cash equivalents with variable interest rates.

The Group has no borrowings or other liabilities which expose it to cash flow or fair value interest rate risks.

The parent entity’s main interest bearing assets are loans to subsidiaries. These bear a fixed interest rate and expose the parent to fair value interest rate risk.


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As at the reporting date, the Group had the following variable rate financial assets and liabilities:

Financial assets


Total financial assets

826

826

1,019

1,019

9,207

9,207

3,276

3,276


2009

$000 $000

2008

$000 $000

2009 2008

Floating interest rates Weighted Average Effective Interest Rate

2009 2008

5.0% 7.05%

Sensitivity Analysis

The following sensitivity analysis is based on the interest rate risk exposures in existence at the balance sheet date. At 30 June 2009, if interest rates had moved, as illustrated in the table below, with all other variables held constant, post tax profit and equity would have been affected as follows:

Net profit

Higher/(Lower)

+ 1% (100 basis points)

- 1% (100 basis points)

Equity

Higher/(Lower)

+ 1% (100 basis points)

- 1% (100 basis points)

508

(508)

508

(508)

10

(10)

10

(10)

92

(92)

92

(92)

33

(33)

33

(33)


2009

$000 $000

2008

$000 $000

2009 2008

Judgements of reasonably probable movements:

The sensitivity in the parent entity is higher in 2009 than the comparable period due to higher intercompany loans.

072

NOTES TO THE FINANCIAL STATEMENT (continued) NOTES TO THE FINANCIAL STATEMENT (continued)

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073

Credit risk

Credit risk is managed on a Group basis. Credit risk arises from cash and cash equivalents, deposits with banks and financial institutions, trade and other receivables.

The Group has no significant concentrations of credit risk. The Group has policies in place to ensure that sales of products and services are made to customers with an appropriate credit history. Derivative counterparties and cash transactions are limited to high credit quality financial institutions. The Group has policies that limit the amount of credit exposure to any one financial institution.

The Group does not hold any credit derivatives to offset its credit exposure.

In addition receivables balances are monitored on an ongoing basis, with the result that the Group’s exposure to bad debts is not significant, while Government receivables are deemed to carry lower credit risk.

The maximum exposure to credit risk (excluding the value of any collateral or other security) at balance sheet date to recognised financial assets is the carrying amount net of any provisions for doubtful debts of those assets, as disclosed in the balance sheets and notes to the financial statements.

Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding through an adequate amount of committed credit facilities and the ability to close-out market positions. Due to the dynamic nature of the underlying businesses, the Directors maintain flexibility in funding by keeping committed credit lines available.

Maturities of financial liabilities

The tables below analyses the Group’s and the parent entity’s financial liabilities, net and gross settled derivative financial instruments into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows:



Net maturity

943

943

-

-

< 1 month

$000 $000

Year ended 30 June 2009

Consolidated

1 – 3

months

-

-

$000

3 – 12

months

-

-

$000

1-5

years

943

943

$

Total



Net maturity

292

292

-

-

< 1 month

$000 $000

Year ended 30 June 2009

Parent Entity

1 – 3

months

-

-

$000

3 – 12

months

-

-

$000

1-5

years

292

292

$

Total

NOTES TO THE FINANCIAL STATEMENT (continued) NOTES TO THE FINANCIAL STATEMENT (continued)

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Net fair values of financial assets and liabilities

The carrying amount of the Group’s identified financial assets and liabilities represents materially their net fair value, other than the loan to other entity as described in Note 17.

Capital management

The Group’s and the parent entity’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

Ongoing reviews of the company’s capital requirements are performed to ensure the company is meeting its objectives.

There were no changes to the company’s approach to capital management during the year. Neither the Company nor its subsidiaries is subject to externally imposed capital requirements.

3 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The Directors evaluate estimates and judgements incorporated in the financial report based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances.

The following key assumptions have been made concerning the future and other key sources of estimation at the balance date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

Impairment of intangible assets

The Group tests annually whether intangibles have suffered any impairment, in accordance with the accounting policy. The recoverable amounts of cash generating units have been determined based on the higher of value in use calculations and fair value less costs to sell.

Refer to Note 16 for details on intangible assets value-in-use calculations and management assessment of key assumptions.

In addition, and despite there being no indicators of impairment, Management engaged an independent professional and qualified valuer, Covenant Equity Consulting Sdn Bhd, to assess whether these was any impairment in respect of the NexCode Proprietary Technology rights as at 30 June 2009. They concluded that the recoverable amount of this asset exceeds the carrying amounts and that there is therefore no impairment in respect of this asset. Covenant Equity Consulting Sdn Bdn used forecasts prepared by management and a PE valuation method to value Nexbis Sdn Bhd and the intangible assets it holds.

Impairment of allowance of trade and other receivables

The Group undertakes a detailed analysis of trade receivables on a monthly basis on and writes off those debtors which it considers not recoverable and makes an impairment provision for those where recovery is considered doubtful.

074


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075

4 REVENUE

NexCode revenue

- Malaysia

- China

Consulting revenue

- China

- Sweden

Total revenue

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

3,334

43,699

47,033

18,059

466

18,525

65,558

-

-

-

16,401

1,229

17,630

17,630


2009

$000 $000

2008

$000 $000

2009 2008

5 OTHER INCOME

Realised gains on foreign exchange

Interest Income

Gain on disposal of plant and equipment

Others

-

5,129

-

-

5,129

-

1,604

-

-

1,604

30

116

5

3

154

-

111

-

-

111


2009

$000 $000

2008

$000 $000

2009 2008


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6 EXPENSES

Profit before income tax include the following

specific expenses:

Employee expense

Occupancy expense

Marketing and administration expense

Write down of intangibles

Amortisation

Depreciation

Option expense

Other expenses from ordinary activities

(3,654)

(65)

(1,332)

-

-

-

(4,879)

(74)

(1,957)

(51)

(1,210)

-

-

-

-

-

(5,874)

(767)

(3,537)

(764)

(3,768)

(54)

(4,879)

(284)

(3,470)

(190)

(2,603)

-

-

(36)

-

(11)


2009

$000 $000

2008

$000 $000

2009 2008

Included in the option expense was an amount of $4,230 which relates to 30,000,000 options issued to employees on the 12 June 2009. These options vested immediately on issue. The options were independently valued and this amount (fair value) has been expensed in the year in accordance with AASB 2. The expiry date of these options was 30 June 2010. They were valued using the Black Scholes Option Pricing Model using a volatility rate of 70-75% (based on historical data) and a risk free rate of 3.4%.

These options were subsequently cancelled on the 24 July 2009 and replaced with 20,000,000 options with different vesting periods, exercise prices and expiry dates to the original grant. None of the original options had been exercised prior to cancellation.

Also included in the option expense was an amount of $500,000 (fair value) which relates to 2,500,000 options issued at $0.20 cents each to a member of the Key Management Personnel on 16 March 2009 on his departure from the Group. These options were issued, vested and exercised on the same day.

076


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077

7 INCOME TAX EXPENSE

Reconciliation of income tax expense to prima facie tax payable:

Operation profit/(loss)

Prima facie tax expense/(credit) thereon at 30% (2008: 30%)

Foreign tax rate adjustments

Tax effect of foreign exchange gains and other translation adjustments

Tax effect of non-deductible expenses

Utilisation of previously recognised tax losses and unabsorbed capital allowances

Tax effect of timing differences, tax losses not brought to account, and tax exemption*

Total income tax expense attributable to operating profit/(loss)

(4,375)

(1,313)

-

-

-

-

1,313

-

(1,614)

(484)

-

-

-

-

484

-

45,785

13,735

(5,166)

275

1,193

(1,720)

(8,317)

-

11,431

(3,495)

-

-

-

-

3,495

-


2009

$000 $000

2008

$000 $000

2009 2008

* No current taxation has been provided in the financial statements as the two Malaysian subsidiary entities have been granted a tax exemption and the other entities are in a tax loss position. The Deferred Tax Asset of $2,657 which arises on the tax losses have not been brought to accounts as the Directors do not consider it probable that the losses will be realised in the short term.

8 KEY MANAGEMENT PERSONNEL COMPENSATION

Generally, the Company follows the guidelines below for determining the nature and amount of emoluments of Board members and senior executives of the Company:

The remuneration structure for executive officers, including executive Directors, is based on a number of factors, including length of service, particular experience of the individual concerned, and overall performance of the company. The contracts for service between the company and specified Directors and executives are on a continuing basis, the terms of which are not expected to change in the immediate future. Termination payments are generally not payable on resignation or dismissal for serious misconduct. In the instance of serious misconduct the Company can terminate employment at any time. Any options not exercised before or on the date of termination will lapse.


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Names and positions held of key management personnel in office at any time during the financial year are:

Key Management Personnel



Peter Dykes

Colin Turner

Yu Ye Chua

Benjamin Cheong

Peter Fang

Options Granted As Compensation

No compensation options were exercised during the year.

Number of options held Directors and Key Management Personnel:

Position

Independent Chairman (Appointed 21 August 2009)

Chief Executive Officer

Chief Financial Officer & Company Secretary


Executive Vice President – Entertainment Media And Telcoms Sdn Bhd

Operations Director - Entertainment Media And Telcoms Sdn Bhd

Software Services Director – Nexbis Sdn Bhd

Parent Entity Directors

John Houston


Peter Dykes

Colin Turner

Total

2,000,000

-

1,200,000

-

3,200,000

2,000,000

-

1,200,000

-

3,200,000

4,000,000

-

2,400,000

-

6,400,000

-

-

-

-

-

Balance

1 July 2008

Number

Acquired

Number

Expired

Balance

30 June 2009

On 21 August, John Houston resigned as Non Executive Chairman and was replaced by Datuk Mohamed Al Amin bin Abdul Majid. Following his resignation, the 2,000,000 options held by John Houston were cancelled.

Shareholdings

Number of shares held by Directors and Key Management Personnel:

Parent Entity Directors

John Houston


Peter Dykes

Colin Turner

Total

-

-

-

-

-

15,164,008

8,300,000

6,540,000

1,013,334

31,017,342

14,664,008

7,800,000

6,040,000

1,013,334

29,517,342

500,000

500,000

500,000

-

1,500,000

Balance

1 July 2008

Number

Acquired

Number

Expired

Balance

30 June 2009

On 21 August, John Houston resigned as Non Executive Chairman and was replaced by Datuk Mohamed Al Amin bin Abdul Majid.

078


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9 AUDITOR’S REMUNERATION

Remuneration of the auditor of the parent entity for:

Auditing or reviewing the financial report

Other services

Remuneration of the auditors of subsidiaries, other

than PKF, for:

Auditing or reviewing the financial report

Other services

143

5

-

-

148

80

-

-

-

80

201

15

28

14

258

80

-

-

-

80


2009

$000 $000

2008

$000 $000

2009 2008

10 DIVIDENDS

During and since the financial year ended 30 June 2009 there has not been any dividend or distribution reinvestment plan in operation. No dividends were paid or made payable during or since the twelve month period to 30 June 2009.

11 EARNINGS PER SHARE

Reconciliation of earnings to profit or loss

Profit attributable to members of the Group

Earnings used to calculate basic EPS

Earnings used in calculation of dilutive EPS

45,896

45,896

45,896

11,651

11,651

11,651

Consolidated

2009

$000

2008

$000

Reconciliation of earnings to profit or loss from continuing operations

Profit/(Loss) for the year

Earnings used to calculated basic EPS

45,896

45,896

11,651

11,651

Weighted average number of ordinary shares (basic and diluted)

Weighted average number of ordinary shares outstanding during the year

used in calculating basic EPS

Weighted average number of options outstanding

Weighted average number of ordinary shares outstanding during the year

used in calculating dilutive EPS

418,256,973

1,765,041

420,022,014

1,438,015,170

1,256,831

1,439,272,001

079


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The 30,000,000 options granted on 12 June 2009 are not included in the calculation of diluted earnings per share because they are anti dilutive for the year ended 30 June 2009. The options were cancelled on 24 July 2009.

The 6,400,000 options granted on 30 January 2008 are not included in the calculation of diluted earnings per share because they are anti dilutive for the year ended 30 June 2009. 3,200,00 of these options expired on 1 December 2008 and the remaining 3,200,000 options expire on 1 December 2009. These remaining options may be dilutive at some time prior to their expiry.

12 CASH AND CASH EQUIVALENTS

Cash at bank

Short-term bank deposits

723

103

826

940

79

1,019

2,892

6,315

9,207

3,197

79

3,276


2009

$000 $000

2008

$000 $000

2009 2008

The effective interest rate on short term bank deposits and cash at bank was 5% (2008: 7.05%).

13 TRADE AND OTHER RECEIVABLES

Trade receivables - -42,009 2,787


2009

$000 $000

2008

$000 $000

2009 2008

Past due not impaired

As at 30 June 2009, trade receivables of $3,729 (2008: $1,308) were past due but not impaired. As there is no impaired receivable no provision is considered necessary. These relate to a number of independent customers for whom there is no history of default. The ageing analysis of these trade receivables is as follows:

Up to 3 months

Over 3 months

-

-

-

-

-

-

3,728

1

3,729

1,285

23

1,308


2009

$000 $000

2008

$000 $000

2009 2008

080


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14 OTHER CURRENT ASSETS

Prepayments

Accrued income

Rental bond

Withholding tax credits

VAT refund

Income tax recoverable

Other debtors

-

-

8

4

-

-

25

37

-

-

8

4

-

-

77

89

20

-

8

4

-

35

447

514

-

15

8

4

14

29

85

155


2009

$000 $000

2008

$000 $000

2009 2008

15 PLANT AND EQUIPMENT

Cost

Less accumulated depreciation

Net carrying amount

-

-

-

-

-

-

1,809

(94)

1,715

388

(53)

335


2009

$000 $000

2008

$000 $000

2009 2008

Reconciliation of carrying amount at the beginning and end of the period:

Net carrying amount at 1 July

Additions

Depreciation

Exchange differences

Net carrying amount at 30 June

-

-

-

-

-

-

-

-

-

-

335

1,398

(54)

36

1,715

11

360

(36)

-

335


2009

$000 $000

2008

$000 $000

2009 2008

Impairment test for plant and equipment

In accordance with the Group’s accounting policy and AASB 136, Management has considered whether there are any indicators of impairment in respect of the Plant and Equipment held by the Group and concluded that there are none.

081


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16 INTANGIBLE ASSETS

Goodwill

Cost

Net carrying amount

Opening net book amount

Arising from acquisition of additional interest in an

existing subsidiary

Acquisitions through business combinations

Reclassified to NexCode Proprietary Technology rights

Reclassification of purchase option


Closing net book amount

-

-

-

-

-

-

-

-

17

312

312

30,792

17,448

-

(55,289)

3,950

3,411

312

30,792

30,792

356

-

32,678

-

-

(2,242)

30,792

Consolidated Parent Entity

2009

$000 $000

2008

$000

2009

-

-

-

-

-

-

-

-

-

2008

$000

At 30 June 2008, the accounting for the business combination of the subsidiary company was provisionally determined. This has now been finalised based on the valuation dated 19 December 2008 on the NexCode Proprietary Technology rights prepared by Covenant Equity Consulting Sdn Bhd, a professional and qualified valuer, resulting in identification of separately identifiable intangibles and therefore reclassification of amounts initially attributed to goodwill.

082


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Impairment test for goodwill

The goodwill of $312,000 arose on the acquisition of Sapio AB in January 2007. The goodwill is allocated to the Swedish CGU and tested annually using value-in-use calculation discounted at 14.5%. These calculations use 5-year cash flows based on financial budgets approved by the management, based on past experience and management’s best estimate of future events. It is reasonably possible that a change in a key assumption such as sales growth, would cause the CGUs carrying amount to exceed its recoverable amount which would result in impairment of the goodwill balance.

Computer software

Cost

Net carrying amount



Additions

Written off

Amortisation charge



Reclassified to NexCode Proprietary Technology rights


Patents and intellectual property rights

Cost

Accumulated amortisation

Net carrying amount


Additions


Amortisation charge




-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

6,291

-

-

(764)

(422)

763

1,524

(7,392)

-

101

(12)

89

56

48

-

(12)

-

(3)

89

6,291

6,291

-

6,003

584

-

-

(296)

-

-

6,291

56

-

56

-

-

59

-

(3)

-

56


2009

$000 $000

2008

$000 $000

2009 2008

083


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NexCode Proprietary Technology rights

Cost

Accumulated amortisation

Net carrying amount

Reclassified from goodwill and computer software

Amortisation charge



NexCode contract rights

Cost

Accumulated amortisation and impaired losses

Net carrying amount


Additions

Amortisation charge



-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

63,089

(3,172)

59,917

62,681

(3,001)

237

59,917

6,121

(306)

5,815

5,566

-

(332)

581

5,815

-

-

-

-

-

-

-

5,566

-

5,566

-

6,000

-

(434)

5,566


2009

$000 $000

2008

$000 $000

2009 2008

Total

Cost

Accumulated amortisation and impaired losses

Net carrying amount


Arising from acquisition of additional interest in an

existing subsidiary


Additions

Written off

Amortisation charge




-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

69,614

(3,478)

66,136

42,705

17,448

-

48

(764)

(3,767)

5,471

4,995

66,136

42,705

-

42,705

356

-

38,740

6,584

-

-

-

(2,975)

42,705


2009

$000 $000

2008

$000 $000

2009 2008

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Impairment test for intangible assets (other than goodwill)

In accordance with the Group’s accounting policy, Management has considered whether there are any indicators of impairment in respect of the other intangible assets held by the Group and concluded that there are none. In this regard, and despite there being no indicators of impairment, Management engaged an independent professional and qualified valuer, Covenant Equity Consulting Sdn Bhd, to assess whether these was any impairment in respect of the NexCode Proprietary Technology rights as at 30 June 2009. They concluded that the recoverable amount of this asset exceeds the carrying amount and that there is therefore no impairment in respect of this asset. Covenant Equity Consulting Sdn Bdn used forecasts prepared by management and a PE valuation method to value Nexbis Sdn Bhd and the intangible assets it holds.

Amortisation of intangible assets (other than goodwill)

All of the intangible assets (other than goodwill) began to be amortised from 1 April 2009 consistent with the commencement of NexCode cards printing, the remaining amortisation period is four years and nine months.

17 FINANCIAL ASSETS

Non Current

Loans to subsidiaries*

Accrued interest on the loan to subsidiaries*

Shares in subsidiaries (note 18):

- Sapio AB

- Entertainment Media And Telcoms Sdn Bhd

- Entertainment Media & Telecoms Corporation (Asia) Limited

- Nexbis (Asia) Limited

Prepayment of loan to other entity**

Loan to other entity**

53,359

6,582

1,102

1

1

1

-

61,046

35,889

1,500

600

1

-

-

-

37,990

-

-

-

-

-

554

5,603

6,157

-

-

-

-

-

-

-


2009

$000 $000

2008

$000 $000

2009 2008

* Note – The loans to subsidiaries have no fixed terms of repayment and are subject to a 10% annual interest rate.

** Note – The loan to other entity is repayable in 5 years and is interest free. The loan has been discounted and interest imputed to reflect this.

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18 SUBSIDIARIES

Details of subsidiaries:

Parent Entity:

Nexbis Limited

Subsidiaries:

Sapio AB

Entertainment Media And Telcoms Sdn Bhd

Nexbis Sdn Bhd

Nexbis (Asia) Limited

Entertainment Media & Telecoms Corporation (Asia) Limited

Australia

Sweden

Malaysia

Malaysia

Hong Kong

Hong Kong

Name

Country of

Incorporation

100.00

100.00

100.00

100.00

100.00

Percentage

Owned

2009

%

100.00

100.00

67.66

-

-

Percentage

Owned

2008

%

19 BUSINESS COMBINATION

Acquisition of additional interest in a subsidiary

On 30 September 2008, Entertainment Media And Telcoms Sdn Bhd acquired the remaining 32.34% of the issued share capital of Nexbis Sdn Bhd for a total consideration of $19.4M.

Purchase consideration:

- Shares paid (221,608,544 shares @ 6.2 cents per share and 15,453,465 @ 40 cents per share)

- Cash

19,921

40,079

60,000

$000

Details of the fair value of assets and liabilities acquired are as follows:


Receivables

Property, plant and equipment

Intangible assets: Computer software

Trade marks and patents

Nexcode Proprietary Technology

Other liabilities

Net assets

508

3

2

-

63

61,671

(2,247)

60,000

Fair Value

$000

508

3

2

7,635

63

-

(2,247)

5,964

Carrying Value

$000

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Outflow of cash acquired to acquire business, net of cash acquired:

Total consideration

Less: Cash and cash equivalents

Less: Shares paid (221,608,544 shares @ 6.2 cents per share and 15,453,465 @ 40 cents per share)

Cash outflow

60,000

(508)

(19,921)

39,571

$000

The acquired business contributed revenues of $47,033,000 and net profit of $42,516,000 to the Group. This would have been the same had the acquisition acquired on 1 July 2008.

20 TRADE AND OTHER PAYABLES

Trade payables

Other payables

Deferred revenue

Amount due to a subsidiary

-

2,305

-

-

2,305

954

3

-

11

968

884

2,195

2,194

-

5,273

980

3,496

-

-

4,476


2009

$000 $000

2008

$000 $000

2009 2008

21 CONTRIBUTED EQUITY

Ordinary shares – issued and fully paid

At 1 July

Issue of shares:

Fully paid

Transaction costs

Net proceeds from issue of shares

Amount due and payable

Acquisition of Nexbis Sdn Bhd

Options exercised

At 30 June

59,735

15,789

(1,210)

14,579

210

6,181

555

81,260

26,864

20,259

(1,128)

19,131

13,740

59,735

59,735

15,974

(1,210)

14,764

25

6,181

555

81,260

26,864

20,259

(1,128)

19,131

13,740

59,735


2009

$000 $000

2008

$000 $000

2009 2008

Fully paid ordinary shares carry one vote per share and carry the right to dividends.

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At 1 July 2008

Consolidation of capital (1 for 5)

Shares issued during the year:

17 September 2008

16 March 2009

30 March 2009

13 May 2009

At 30 June 2009

1,871,000,000

(1,496,799,904)

55,000,000

2,500,000

830,000

200,000

432,730,096


2009 2008

Number of Ordinary Shares

1,239,250,000

631,750,000

1,871,000,000

On 11 August 2008, a 1 for 5 consolidation of shares was approved by the Company’s shareholders. Consequently, the number of shares was reduced from 1,871,000,000 to 374,200,096 on 25 August 2008. The additional 96 shares was due to rounding effect.

Options

Information relating to Nexbis Limited’s issued options, including details of option issued, exercised and lapsed during the financial year and options outstanding at the date of this report, is set out below.

On 24 July 2009, the executive/employee options issued on 12 June 2009 were cancelled and replaced with a new issue on 1 July 2009 of 20 million options exercisable at between $0.75 cents and up to $1.50 per share, which vest over three years up to 1 July 2012 and expiring over four years up to 30 June 2013. The original options issued on 12 June 2009 were independently valued and this amount (fair value) has been expensed in the year in accordance with AASB 2. The expiry date of these options was 30 June 2010. They were valued using the Black Scholes Option Pricing Model using a volatility rate of 70-75% (based on historical data) and a risk free rate of 3.4%.

The 970,000 options issued under the employee share plan expire on 30 June 2011.

The weighted average share price during the year was $0.35 cents.

088

Directors and key management

Employee share plan

Total

6,400,000

-

2,000,000

-

8,400,000

$0.75

$0.20

$0.175

$0.50

30 January 2008

16 March 2009

14 May 2008

12 June 2009

5,200,000

-

-

-

5,200,000

5,200,000

-

970,000

30,000,000

32,170,000

-

2,500,000

-

30,000,000

32,500,000

-

2,500,000

1,030,000

-

3,530,000


Exerciseprice

Issuedate

Options granted

Options converted

Options expired/

cancelled


6,400,000 2,500,000 2,500,000 5,200,000 5,200,000

2,000,000 - 30,970,00030,000,000 1,030,000


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22 RETAINED PROFITS/(ACCUMULATED LOSSES)

Opening balance at beginning of the year

Profit/(Loss) for the year

Option expense adjustment

(21,806)

(4,375)

118

(26,063)

(20,192)

(1,614)

(21,806)

(8,417)

45,896

118

37,597

(20,068)

11,651

-

(8,417)


2009

$000 $000

2008

$000 $000

2009 2008

23 FOREIGN CURRENCY TRANSLATION RESERVE


Net foreign currency translation difference

Closing balance at end of the year

-

-

-

-

-

-

(2,831)

32

(2,799)

(10)

(2,821)

(2,831)


2009

$000 $000

2008

$000 $000

2009 2008

Exchange differences arising on translation of the foreign controlled entity are taken to the foreign currency translation reserve as described in note 1(a). The reserve is recognised in profit and loss when the net investment is disposed of.

24 OPTION RESERVE


Issued during the year

Expired during the year

Exercised during the year

201

4,879

(118)

(555)

4,407

-

201

-

-

201

201

4,879

(118)

(555)

4,407

-

201

-

-

201


2009

$000 $000

2008

$000 $000

2009 2008

The Option Reserve is used to recognise the fair value of the options issued but not exercised and the fair value of shares issued to employees.

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25 OPTION RESERVE - OTHER


Acquired during the year

Option exercised during the year

Closing balance as at 30 June 2009

5,471

-

(5,471)

-


2009 2008


-

-

-

-

-

-

-

-

-

5,471

-

5,471

$000

2008

$000 $000

2009 20082009

$000

The Option Reserve – Other is used to recognize the option to acquire the remaining shares in Nexbis Sdn Bhd. This option was exercised during the year and the closing balance is therefore nil.

26 MINORITY INTEREST


Arising on acquisition of a subsidiary

Share of loss for the year

Disposal of interest by minority interest

Closing balance as at 30 June 2009

1,565

-

(111)

(1,454)

-


2009 2008


-

-

-

-

-

-

1,785

(220)

-

1,565

$000

2008

$000

20092009

$000

Minority interest is that portion of profit or loss and net assets of a subsidiary attributable to equity interest that are not owned, directly or indirectly through subsidiaries, by the Company.

-

-

-

-

-

2008

$000

27 CONTINGENT LIABILITIES

In accordance with the contracts with Executive Directors allowance is made for minimum bonuses to be paid. These bonuses, as outlined in the Remuneration Report, will only be paid subject to the Group earning sufficient levels of profit. Ultimate discretion as to the payment of these bonuses lies with Board of Directors.

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28 SEGMENT INFORMATION

Primary reporting based on geographical segments

Revenue from external customers

- NexCode

- Consulting

Other income

Total Segment Revenue

Intangibles write off

Depreciation

Amortisation

Option expense

Capital expenditure

Profit/(Loss) from ordinary activities before income tax

Income tax expense

Net Profit/(Loss)

Assets

Segment assets

Total Assets

Liabilities

Segment liabilities

Total Liabilities

Total Net Assets/ (Liabilities)

-

-

-

109

109

-

-

-

4,878

-

(4,375)

-

(4,375)

1,175

1,175

(2,305)

(2,303)

(1,130)

Australia

2009

$000

2008

$000

-

-

-

103

103

-

-

-

-

-

(3,114)

-

(3,114)

1,464

1,464

(958)

(958)

506

-

466

466

45

511

-

5

-

-

-

(717)

-

(717)

282

282

(187)

(189)

95

-

1,229

1,229

8

1,237

-

8

-

-

-

(92)

-

(92)

428

428

(173)

(173)

255

47,033

18,059

65,092

-

65,092

764

49

3,768

-

1,398

50,995

-

50,995

124,281

124,281

(2,781)

(2,781)

121,500

-

16,401

16,401

-

16,401

-

28

-

-

-

14,857

-

14,857

47,367

47,367

(3,346)

(3,346)

44,021

-

-

-

-

-

-

-

-

-

-

(7)

-

(7)

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

47,033

18,525

65,558

154

65,712

764

54

3,768

4,878

-

45,896

45,896

125,738

125,738

(5,273)

(5,273)

120,465

17,630

17,630

111

17,741

-

36

-

-

-

11,651

-

11,651

49,259

49,259

(4,477)

(4,477)

44,782

$000 $000 $000 $000 $000 $000 $000 $000

2009 2008 2009 2008 2009 2008 2009 2008

Sweden Malaysia Hong Kong Consolidated

During the year, intercompany revenue by Sapio AB from software development charges to Nexbis Sdn Bhd was $270. This has been eliminated in the segment revenue. Intercompany loans and investments are eliminated in the segment assets and liabilities. Segment revenue is based on the location of the service delivery operations. Segment assets and capital expenditure are allocated based on where the assets are located.

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Secondary reporting based on business segments

Revenue from external customers:

Malaysia

China

Sweden

Total revenue

Segment assets

Unallocated assets

Total assets

Other segment information:

Capital expenditure

3,334

43,699

-

47,033

87,940

1,398

20092009

3,334

61,758

466

65,558

124,563

1,175

125,738

1,398

-

18,059

466

18,525

36,623

-

$000$000

NexCode

$000

Consulting Consolidated

Revenue from external customers:

Malaysia

China

Sweden

Total revenue

Segment assets

Unallocated assets

Total assets

Other segment information:

Capital expenditure

-

-

-

-

-

-

-

-

20092008

-

16,401

1,229

17,630

47,795

1,464

49,259

360

-

16,401

1,229

17,630

47,795

360

$000$000

NexCode

$000

Consulting Consolidated

Segment revenue is based on the country in which the customer is located. Segment assets are those directly attributable to a segment, allocated on a reasonable basis.

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29 CASH FLOW STATEMENT RECONCILIATION

Reconciliation of net profit after tax to net cash flows from operation:

Profit/(Loss) from ordinary activities before income tax

Non-cash flows in profit/(loss) from ordinary activities

Amortisation and depreciation

Write-down of intangibles

Gain on disposal of plant and equipment

Provision for Option Reserve

Translation Reserve adjustments

Interest income – non cash

Changes in assets and liabilities, net of the effects of

purchase and disposal of subsidiaries

Increase in trade and term debtors

(Increase)/Decrease in other assets

Increase/(Decrease) in trade creditors and accruals

Increase in other liabilities

Income tax paid

Net cash provided by/(used in) operating activities

(4,375)

-

-

-

4,878

-

(5,082)

-

-

1,632

-

(2,947)

(1,614)

-

-

-

95

-

(1,500)

-

185

(276)

11

(3,099)

45,785

3,822

764

(5)

4,878

32

-

(44,524)

-

1,118

-

(3)

11,867

11,431

36

95

(571)

(1,943)

(104)

(392)

631

9,183


2009

$000 $000

2008

$000 $000

2009 2008

30 EVENTS AFTER THE BALANCE SHEET DATE

On 24 July 2009, the executive/employee options issued on 12 June 2009 were cancelled and replaced with a new issue on 1 July 2009 of 20,000,000 options exercisable at between $0.75 cents and up to $1.50 per share, which vest over three years up to 1 July 2012 and expiring over four years up to 30 June 2013.

On 10 August 2009, Entertainment Media & Telecoms Corporation Limited changed its name to Nexbis Limited.

On 21 August, John Houston resigned as Non Executive Chairman and was replaced by Datuk Mohamed Al Amin bin Abdul Majid.

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31 RELATED PARTY TRANSACTIONS

The related parties to the Group are:

Parent entity

The ultimate parent entity within the Group is Nexbis Limited, a company incorporated in Australia.

Subsidiaries

Interests in subsidiaries are set out in note 18.

Key management personnel

Disclosures relating to Directors and specified executives are set out in note 8.

Related party transactions

There were no other related party transactions during in the financial year.

32 COMPANY DETAILS

The registered office and principal place of business of the Company is:

Level 40100 Miller StreetNorth Sydney NSW 2060

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DIRECTORS’DECLARATIONFOR THE YEAR ENDED 30 JUNE 2009

The Directors of Nexbis Limited declare that:

(a) in the directors’ opinion, the financial statements and notes on pages 53 to 92, and the remuneration disclosures that are contained in the Remuneration report in the Directors’ report, set out on pages 40 to 51, are in accordance with the Corporations Act 2001, including:

(i) giving a true and fair view of the company’s and the consolidated entity’s financial position as at 30 June 2009 and of their performance, for the financial year ended on that date; and

(ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and Corporations Regulations 2001.

(b) the financial report also complies with International Financial Reporting Standards as disclosed in note 1; and

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

The directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer for the financial year ended 30 June 2009, required by Section 295A of the Corporations Act 2001.

Signed in accordance with a resolution of the Directors.

Dated this 30th day of September 2009, Sydney

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INDEPENDENTAUDITOR'S REPORT FOR THE YEAR ENDED JUNE 2009

To the members of Nexbis Limited

Report on the Financial Report

We have audited the accompanying financial report of Nexbis Limited, which comprises the balancesheet as at 30 June 2009, and the income statement, statement of changes in equity and cash flow statement for the year ended on that date, a summary of significant accounting policies and other explanatory notes and the directors’ declaration for both Nexbis Limited (the company) and the consolidated entity. The consolidated entity comprises the company and the entities it controlled at the year’s end and from time to time during the financial year.

Directors’ Responsibility for the Financial Report

The directors of the company are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including the Australian AccountingInterpretations) and the Corporations Act 2001. This responsibility includes establishing and maintaining internal controls relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. In Note 1(b), the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that compliance with Australian Equivalents to International Financial Reporting Standards ensures that the financial report, comprising the financial statements and notes, complies with International Financial Reporting Standards.

Auditors’ Responsibility

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

Tel: 61 2 9251 4100 | Fax: 61 2 9240 9821 | www.pkf.com.au PKF | ABN 83 236 985 726 Level 10, 1 Margaret Street | Sydney | New South Wales 2000 | Australia DX 10173 | Sydney Stock Exchange | New South Wales

The PKF East Coast Practice is a member of PKF Australia Limited a national association of independent chartered accounting and consulting firms each trading as PKF. The East Coast Practice has offices in NSW, Victoria and Brisbane. PKF East Coast Practice is also a member of PKF International, an association of legally independent chartered accounting and consulting firms.

Liability limited by a scheme approved under Professional Standards Legislation

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INDEPENDENT AUDITOR’S REPORTTO THE MEMBERS OF NEXBIS LIMITED

FOR THE YEAR ENDED 30 JUNE 2009

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including theassessment of the risks of material misstatement of the financial report whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overallpresentation of the financial report.

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

Independence

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

Auditors’ Opinion

In our opinion:

(a) the financial report of Nexbis Limited is in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the company’s and consolidated entity’s financial position as at 30 June 2009 and of their performance for the year ended on that date; and (ii) complying with Australian Accounting Standards (including Australian Accounting Interpretations) and the Corporations Regulations 2001; and

(b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 1.

Report on the Remuneration Report

We have audited the Remuneration Report included in pages 40 to 51 of the directors’ report for the year ended 30 June 2009. The directors of the company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.

Auditor’s Opinion In our opinion the Remuneration Report of Nexbis Limited for the year ended 30 June 2009 complies with section 300A of the Corporations Act 2001.

PKF

Bruce GordonPartner

INDEPENDENT AUDITOR'S REPORT (continued)

Sydney, 30 September 2009

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098

CATEGORY (size of holding) HOLDERS

151886659

1,447267

3,410

DISTRIBUTION OF SHAREHOLDERS as at 26 October 2009

SHAREHOLDERSINFORMATION

1 to 1,000

1,001 to 5,000

5,001 to 10,000

10,001 to 100,000

100,001 and above

Corporate Ownership

Number of ordinary shareholders

Voting rights

- Ordinary Shares

- 3,410 (2008: 1,331)

- on show of hands: one vote for each member

- on poll: one vote for each share held

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099

NATIONAL NOMINEES LTD J P MORGAN NOMINEES AUSTRALIA LTD ANZ NOMINEES LTDHSBC CUSTODY NOMINEES (AUSTRALIA) LTDCITICORP NOMINEES PTY LTDAVIN DAVID LIEBERMAN JOHANN YOUNG COGENT NOMINEES PTY LTD QUESTOR FINANCIAL SERVICES LTD PHILLIP SECURITIES (HONG KONG) LTDTHE BIMM CORPORATION PTY LTD RBC DEXIA INVESTOR SERVICES AUSTRALIA NOMINEES PTY LTD HSBC CUSTODY NOMINEES AUSTRALIA LTD UBS NOMINEES PTY LTD G J & M H INVESTMENTS PTY LTD UBS WEALTH MANAGEMENT AUSTRALIA NOMINEES PTY LTD PETER JAMES DYKES STATION CAPITAL PTY LTD YONGALA INVESTMENTS PTY LTD FORTIS CLEARING NOMINEES PTY LTD

Percentage of issued ordinary shares held by twenty largest holders 63.16%

SUBSTANTIAL SHAREHOLDERS

ORBIS INVESTMENT MANAGEMENT (AUSTRALIA) PTY LTDMANIFEST CAPITAL MANAGEMENT PTY LTD

NON-MARKETABLE PARCELSNon-marketable securities which are holdings of less than 1,450 ordinary shares are held by 253 Shareholders.(2008 parcels: 230)

50,139,51040,831,26338,077,78737,374,70219,815,154

10,000,0008,050,0007,940,1226,913,3396,887,6516,309,9906,057,6495,803,6535,460,5385,120,1804,524,0004,500,0004,104,2262,800,0002,549,857

54,908,74521,828,005

273,259,621TOP 20 TOTAL

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TOP TWENTY SHAREHOLDERS as at 26 October 2009

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CORPORATE DIRECTORY

COMPANY SECRETARYPeter Dykes

REGISTERED OFFICELevel 40,100, Miller Street, North Sydney, NSW 2060

SHARE REGISTRYSecurity Transfer Registrars Pty Ltd, 770 Canning Highway, Applecross WA 6153

AUDITORSPKF,Level 10, 1 Margaret StreetSydney NSW 2000

SOLICITORS TO THE COMPANY

Home Wilkinson LowryLevel 14,Australia Square,Sydney NSW 2000

MiddletonsLevel 2652 Martin PlaceSydney NSW 2000

BANKERSWestpac Banking Corporation,181 Miller Street,North Sydney NSW 2060

STOCK EXCHANGE LISTINGThe company’s shares are quoted on the Australian Stock Exchange under the code NBS.


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