Kiteboarding Australia Limited

Annual Financial Report For the year ended 30 June 2017

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Directors Report The Directors of Kiteboarding Australia Limited (‘Kiteboarding Australia’ or ‘the Company’) present their Report together with the financial statements of the company for the year ended 30 June 2017.

Director Details The following persons were Directors of Kiteboarding Australia during the financial year. Mr Simon Savage MBA MAICD Independent Non-Executive Director President & Chairperson Vice-President (ceased October 2016) Director since March 2014 Simon is a management consultant with over 15 years' experience in strategic planning, stakeholder engagement and risk management. He has held executive positions for several large consulting firms and has been an officer for the Australian Department of Foreign Affairs and Trade. Simon has been involved with the sport of sailing his entire life and has been kiteboarding since 2009. Mr Patrick St John B.Com LLB Independent Non-Executive Director Vice President since October 2016 Director since October 2016 Patrick is a partner in a leading global law firm. He has experience as a finance lawyer and has held senior management roles for the past 8 years with a focus on innovation and strategy implementation. Patrick brings fresh eyes to the board with no industry or state association affiliations. He has been kiteboarding for only 3 years so can still easily remember what it’s like for beginners in the sport. Patrick has a background in yacht racing and has sailed in numerous ocean racing events in Australia and overseas. Mr Campbell King CA Independent Non-Executive Director President & Chairperson (ceased October 2016) Director from September 2012 to October 2016 Campbell is a Chartered Accountant with broad financial and commercial experience and is a Partner at accounting and advisory firm mi-fi. Campbell has been kiteboarding since 2004 and has been involved in the governance and development of the sport since 2009 when he joined the committee of Kiteboarding Victoria serving as President. He was a committee member of the Australian Kitesurfing Association Inc in 2010 before driving the creation of Kiteboarding Australia, becoming a founding director and President.

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Mr Sean Webb BBS(Hon) GAICD F Fin MBA Independent Non-Executive Director Director since October 2013 Sean has over 10 years of experience as a director of Industry, Not-for-Profit and Sporting Boards. He is a past President of the Irish Kitesurfing Association and has held positions with the Australian Kitesurfing Association Inc and the Western Australia Kitesurfing Association Inc. Sean has been involved with the sport since 2003, holds a British Kitesports Association Senior Instructor qualification and has been teaching for over 10 years. Mrs Janine Cullen OAM FAICD Independent Non-Executive Director Director from March 2014 to October 2016 Janine has more than 20 years of experience as a director on State Government, Business and Not-for-Profit Boards. She has extensive skills in media, marketing, communication and advertising, having more than 25 years in senior management and leadership roles. Janine has a thorough understanding of corporate governance expectations, ethical considerations and setting strategic direction. Ms Sonia Robinson BA (Hons) MA (Hons) RYA/MCA Yachtmaster Offshore Independent Non-Executive Director Director from June 2015 to October 2016 Sonia is a sport development strategist. Over the past 10 years she has created policies and safety standards for national sailing school operations. She engages with stakeholders to promote participation and retention through the provision of quality program frameworks, pathways and resources. She is an active kiteboarder, sailing instructor and past committee member and Vice President of Kiteboarding NSW. Mr Mark Kelly Independent Non-Executive Director Director since September 2015 Mark has an extensive career as a senior human resources executive with a range of large public and private sector businesses. He has particular expertise in employment law, employee relations and safety and risk management. Mark started kiting in 2013 having sailed and windsurfed over many years. He was invited to join the Board of Kiteboarding Australia and is keen to support the development and growth of kiteboarding across all disciplines. Mr Brett Long Independent Non-Executive Director Director since July 2016 Brett has a background as a Physiotherapist and as a clinical lead across the public and private sector. For the last 5 years he has been growing memberships in private sector organisations with a focus on delivering membership value and achieving positive outcomes for organisations and their

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members. Brett has been kiteboarding for 6 years with a history of wakeboarding and surfing. Brett is focused on creating value for Kiteboarding Australia members. Mr Will Chapman BAppFin, DipFinServ (Financial Planning) Independent Non-Executive Director Director since October 2016 Will started kiteboarding in 2000 after a year in Europe when the sport was just taking off. He has been active in his local kiting community in Adelaide joining the KSA Board (then SAKSA); focusing on retaining beach access and dealing with local councils. Will is a Financial Adviser and has been employed in the finance sector for the past 17 years. Will also sails competitively and is a regular participant in the SA Variety Bash. Mr Rick Elliott BEng (MechEng)(Hons) Independent Non-Executive Director Director since October 2016 Rick has been involved with the Victorian Kite Boarding Association Inc. (‘Kiteboarding Victoria’) since 2005 where he was the president between 2008-2016, focusing on maintaining and enhancing the safety of kiteboarding for both kiteboarders and the public. Rick has over 30 years’ experience in Surf Life Saving and enjoys working with groups of volunteers.

Administrative Officer Ms Alexandra Lockie General Manager Administrative Officer since August 2015 Alexandra came to Kiteboarding Australia after beginning her career as a commercial litigation lawyer. She brings exceptional project management experience, advocacy and communication skills to the role. Alexandra is active across the Australia kiteboarding community and sits as an Executive Committee Member on the International Kitesports Association. Alexandra is a passionate sportswoman having competed internationally in snowboarding for Australia, grown up sailing and currently focuses much of her spare time on long distance triathlon.

Principle Activities During the year, the principal activities of Kiteboarding Australia were to act as the peak body for the sport of kiteboarding in Australia. In doing so delivering leadership, governance and best practice safety for its members and the kiteboarding community. Activities included:

• Implementation of the Kiteboarding Australia Strategic Plan.

• In association with the state kiteboarding associations and the kiteboarding industry participants setting objectives, plans and priorities to deliver a successful and growing future for kiteboarding in Australia.

• Development of governance policies and procedures to support the activities and objectives of the organisation.

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• Maintaining and improving the Kiteboarding Australian Insurance Program for the protection of individual members, officers and volunteers of Kiteboarding Australia and the state kiteboarding associations and the wider kiteboarding community.

• Promoting safe kiteboarding and maintaining beach access for kiteboarders through engagement with individual participants, local councils, government authorities and members of the public.

• Supporting the state kiteboarding associations through the collection and allocation of membership funds, professional resources and guidance.

• Promoting competition amongst members by organising and funding events.

• Promoting greater participation in kiteboarding. There have been no significant changes in the nature of these activities during the year.

Short-term Objectives The Company’s short-term objectives are to:

• Develop a set of safety standards for members.

• Develop a national competition for all disciplines of kiteboarding.

• Develop a national instruction curriculum, accreditation system and corresponding insurance program for kiteboarding schools and instructors in Australia.

• Improve the Kiteboarding Australia brand and market presence.

• Grow the individual membership of the organisation.

Long-term Objectives The Company’s long-term objectives are to:

• Obtain National Sporting Organisation status.

• Obtain federal government funding.

• Develop elite training programs and pathways to elite competition including the Olympics for aspiring athletes.

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Strategy for achieving short and long-term objectives To achieve these objectives, the Company had adopted the following strategies:

• Maintaining a professional and well governed organisation.

• Engaging relevant professionals to provide advice.

• Employing a full-time resource to act as General Manager and fill the constitutional role of Administrative Officer.

• Attracting and seeking out qualified and experienced individuals to join the Board.

• Developing strong relationships with all industry participants.

Directors’ meetings The number of meetings of Directors held during the year and the number of meetings attended by each Director, is as follows:

Board Meetings

A B

Simon Savage 9 9

Patrick St John 6 6

Campbell King 3 3

Sean Webb 9 9

Janine Cullen 3 3

Sonia Robinson 3 2

Mark Kelly 9 7

Brett Long 9 9

Will Chapman 6 6

Rick Elliott 6 5

Where:

• column A is the number of meetings the Director was entitled to attend

• column B is the number of meetings the Director attended

Members The Company is limited by guarantee and without share capital. The members as at 30 June 2017 are:

• New South Wales Kiteboarding Association Inc.

• Kiteboarding Queensland & Northern Territory Inc.

• South Australian Kitesurfing Association Inc.

• Kiteboarding Victoria Inc.

• Western Australia Kite Surfing Inc.

Contribution in Winding Up The Company is incorporated under the Corporations Act 2001 and is a Company limited by guarantee. If the Company is wound up, the constitution states that each member is required to contribute a maximum of $1 each towards meeting any outstanding obligations of the entity. At 30 June 2016, the total amount that members of the Company are liable to contribute if the Company is wound up is $5 (2016: $5).

Small Company Limited by Guarantee As at 30 June 2016 Kiteboarding Australia Limited is a small company limited by guarantee as defined in s.45B of the Corporations Act 2001. As such the Company is not required to have its

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accounts audited or reviewed unless directed by a member of the Company or by the Australian Securities & Investments Commission. These financial statements have not been audited or reviewed. Signed in accordance with a resolution of the Directors. Simon Savage Director 16 October 2017

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Statement of Profit or Loss and Other Comprehensive Income

For the year ended 30 June 2017

Notes 30 June 2017 30 June 2016

Revenue

Membership Revenue 199,331 175,216

Course Revenue 4,127 6,000

Event Revenue 1,750 1,364

Total Revenue 205,209 182,580

Other Income

Grant Income 16,000 -

Interest Income 449 382

Total Other Income 16,449 382

Expenses

Interest Expense 5,598 4,197

Employee Benefits Expense 4.1 52,673 56,941

Depreciation 326 307

Funding to State Associations 5 16,397 -

Insurance Expense 79,148 80,600

IT Expenses 4,560 6,528

Legal Expenses 6,472 10,028

Event Expenses 10,494 4,062

Membership Expenses 8,701 10,692

Contractors 15,000 319

Other Operating Expenses 19,905 19,146

Total Expenses 219,276 192,819

Surplus (Deficit) for the Period 2,382 (9,857)

Other Comprehensive Income - -

Total Comprehensive Income (Loss) for the Period 2,382 (9,857)

This statement should be read in conjunction with the notes to the financial statements.

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Statement of Financial Position

As at 30 June 2017

Notes 30 Jun 2017 30 Jun 2016

Assets

Current Assets

Cash and Cash Equivalents 6 31,810 24,527

Prepaid Insurance 50,545 68,431

Prepaid Interest 3,336 4,928

Trade and Other Receivables 7 4,830 1,673

Total Current Assets 90,520 99,559

Non-current Assets

Property, Plant and Equipment 10 345 671

Total Non-current Assets 345 671

Total Assets 90,865 100,230

Liabilities

Current Liabilities

Trade and Other Payables 9 13,613 9,402

Borrowings 8 52,636 70,282

Provision for Employee Benefits 4.2 3,825 2,137

Total Current Liabilities 70,074 81,821

Total Liabilities 70,074 81,821

Net Assets 20,791 18,409

Equity

Retained Earnings 20,791 18,409

Total Equity 20,791 18,409

This statement should be read in conjunction with the notes to the financial statements.

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Statement of Changes in Equity

For the year ended 30 June 2017

Notes 2017 2016

Equity

Opening Balance 18,409 28,266

Current Year Earnings 2,382 (9,857)

Total Equity 20,791 18,409

This statement should be read in conjunction with the notes to the financial statements.

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Statement of Cash Flows

For the year ended 30 June 2016

Notes 2017 2016

Cash Flows from Operating Activities

Receipts from customers 224,486 199,911

Payments to suppliers and employees (144,342) (113,861)

Cash receipts from other operating activities 4,139 (14,030)

Cash payments from other operating activities (10) (219)

Total Cash Flows from Operating Activities 84,273 71,802

Cash Flows from Investing Activities

Payment for property, plant and equipment - (978)

Other cash items from investing activities (58,076) (155,790)

Total Cash Flows from Investing Activities (58,076) (156,768)

Cash Flows from Financing Activities

Other cash items from financing activities (18,914) 23,130

Total Cash Flows from Financing Activities (18,914) 23,130

Net Increase (Decrease) in Cash Held 7,282 (61,837)

Cash Balances

Cash and cash equivalents at beginning of period 24,527 86,364

Cash and cash equivalents at end of period 6 31,810 24,527

Net change in cash for period 7,282 (61,837)

This statement should be read in conjunction with the notes to the financial statements.

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Note to the Financial Statements

1 General information and statement of compliance The financial report includes the financial statements and notes of Kiteboarding Australia Limited (‘Kiteboarding Australia’ or ‘the Company’). These financial statements are general purpose financial statements that have been prepared in accordance with Australian Accounting Standards – Reduced Disclosure Requirements and the Corporations Act 2001. Kiteboarding Australia Limited is a Not for Profit entity for the purpose of preparing the financial statements. The financial statements for the year ended 30 June 2017 were approved and authorised for issue by the Board of Directors on 16 October 2017.

2 Changes in accounting policies 2.1 Correction of Prior Period During the year it was found that for the year ended 30 June 2014, GST payable had been overstated due to the entity not being required to be registered for a part of the year ended 30 June 2014. This error has been rectified by restating each of the affected financial statement line items for the period ended 30 June 2014 as follows:

This correction has also impacted the Statement of Financial Position in subsequent periods by the same adjustment amounts stated above. This Annual Report includes the restatement of the comparative period ending 30 June 2016.

Previous

amount

$

Adjustment

$

Restated

amount

$

Trade and Other Payables 134,139 (10,364) 123,775

Total Current Liabilities 134,139 (10,364) 123,775

Prepaid Insurance 73,556 (300) 73,256

Retained Earnings 77,192 10,064 87,256

Total Equity 77,192 10,064 87,256

Previous

amount

$

Adjustment

$

Restated

amount

$

Membership Revenue 211,272 14,022 225,294

Total Revenue 330,499 14,022 344,521

Total Expenses 253,307 3,957 257,264

Surplus (Deficit) for the Year 77,192 10,064 87,256

Total Comprehensive Income (Loss) for the Year 77,192 10,064 87,256

30 June 2014

Statement of Financial Position (Extract)

Statement of Profit or Loss and Other

Comprehensive Income (extract)

30 June 2014

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2.1 Reclassifications Adjustments to the classification of expenses have been made to improve the presentation of the financial statements. The following reclassifications have been made for the period ended 30 June 2017 with subsequent reclassification of the prior period comparatives. Income Operating Revenue has been disaggregated on the Statement of Profit or Loss and Other Comprehensive Income. Expenses Other Operating Expenses have been disaggregated on the Statement of Profit or Loss and Other Comprehensive Income. The following expense items previously included in Other Operating Expenses have been stated separately:

• Event Expenses

• Membership Expenses

• Legal Expenses

• Information Technology (‘IT’) Expenses

• Contractors

2.2 New and revised standards that are effective for these financial statements A number of new and revised standards are effective for annual periods beginning on or after 1 January 2015. Information on the more significant standard(s) is presented below. AASB 2014-3 Amendments to Australian Accounting Standards – Accounting for Acquisitions of Interests in Joint Operations The amendments to AASB 11 Joint Arrangements state that an acquirer of an interest in a joint operation in which the activity of the joint operation constitutes a ‘business’, as defined in AASB 3 Business Combinations, should:

• apply all of the principles on business combinations accounting in AASB 3 and other Australian Accounting Standards except principles that conflict with the guidance of AASB 11. This requirement also applies to the acquisition of additional interests in an existing joint operation that results in the acquirer retaining joint control of the joint operation (note that this requirement applies to the additional interest only (i.e. the existing interest is not re measured) and to the formation of a joint operation when an existing business is contributed to the joint operation by one of the parties that participate in the joint operation)

• provide disclosures for business combinations as required by AASB 3 and other Australian Accounting Standards.

AASB 2014-3 is applicable to annual reporting periods beginning on or after 1 January 2016. The adoption of these amendments has not had a material impact on the Group. ASB 2014-4 Amendments to Australian Accounting Standards – Clarification of Acceptable Methods of Depreciation and Amortisation The amendments to AASB 116 prohibit the use of a revenue-based depreciation method for property, plant and equipment. Additionally, the amendments provide guidance in the application of the diminishing balance method for property, plant and equipment. The amendments to AASB 138 present a rebuttable presumption that a revenue-based amortisation method for intangible assets is inappropriate. This rebuttable presumption can be overcome (i.e. a revenue-based amortisation method might be appropriate) only in two (2) limited circumstances:

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• the intangible asset is expressed as a measure of revenue, for example when the predominant limiting factor inherent in an intangible asset is the achievement of a revenue threshold (for instance, the right to operate a toll road could be based on a fixed total amount of revenue to be generated from cumulative tolls charged); or

• when it can be demonstrated that revenue and the consumption of the economic benefits of the intangible asset are highly correlated.

AASB 2014-4 is applicable to annual reporting periods beginning on or after 1 January 2016. The adoption of these amendments has not had a material impact on the Group. AASB 2014-9 Amendments to Australian Accounting Standards – Equity Method in Separate Financial Statements The amendments introduce the equity method of accounting as one of the options to account for an entity’s investments in subsidiaries, joint ventures and associates in the entity’s separate financial statements. AASB 2014-9 is applicable to annual reporting periods beginning on or after 1 January 2016. The adoption of these amendments has not had a material impact on the Group. AASB 2015-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 101 The Standard makes amendments to AASB 101 Presentation of Financial Statements arising from the IASB’s Disclosure Initiative project. The amendments:

• clarify the materiality requirements in AASB 101, including an emphasis on the potentially detrimental effect of obscuring useful information with immaterial information

• clarify that AASB 101’s specified line items in the statement(s) of profit or loss and other comprehensive income and the statement of financial position can be disaggregated

• add requirements for how an entity should present subtotals in the statement(s) of profit and loss and other comprehensive income and the statement of financial position

• clarify that entities have flexibility as to the order in which they present the notes, but also emphasise that understandability and comparability should be considered by an entity when deciding that order

• remove potentially unhelpful guidance in AASB 101 for identifying a significant accounting policy

AASB 2015-2 is applicable to annual reporting periods beginning on or after 1 January 2016. The adoption of these amendments has not had a material impact on the Group.

3 Summary of accounting policies 3.1 Overall considerations The significant accounting policies that have been used in the preparation of these financial statements are summarised below.

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The financial statements have been prepared using the measurement bases specified by Australian Accounting Standards for each type of asset, liability, income and expense. The measurement bases are more fully described in the accounting policies below.

3.2 Operating Revenue Revenue is measured by reference to the fair value of consideration received or receivable by the Company for goods supplied and services provided, excluding sales taxes. Revenue is recognised when the amount of revenue can be measured reliably, collection is probable, the costs incurred or to be incurred can be measured reliably, and when the criteria for each of the Company’s different activities have been met. Details of the activity-specific recognition criteria are described below. Membership Revenue Revenue from the sale of memberships is recognised when received. Course Income Revenue from training courses is recognised at the earlier of when the course is delivered or where payments by participants become non-refundable. Event Income Revenue from events is recognised at the earlier of when the event is held or where payments by participants or event organisers become non-refundable.

3.3 Other Income Other Income consists of income that does not relate to the normal activities of the Company and/or is one-off in nature. Grant Income Revenue from grants provided by government or other organisations. If conditions are attached to a grant which must be satisfied before the Group is eligible to receive the contribution, recognition of the grant as revenue is deferred until those conditions are satisfied. Where a grant is received on the condition that specified services are delivered to the grantor, this is considered a reciprocal transaction. Revenue is recognised as services are performed and at year end a liability is recognised until the service is delivered. Revenue from a non-reciprocal grant that is not subject to conditions is recognised when the Group obtains control of the funds, economic benefits are probable and the amount can be measured reliably. Where a grant may be required to be repaid if certain conditions are not satisfied, a liability is recognised at year end to the extent that conditions remain unsatisfied. Where the Group receives a non-reciprocal contribution of an asset from a government or other party for no or nominal consideration, the asset is recognised at fair value and a corresponding amount of revenue is recognised. Interest Income Interest income is recognised when received.

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3.4 Operating expenses Operating expenses are recognised in profit or loss upon utilisation of the service or at the date of their origin.

3.5 Property, plant and equipment

Plant and other equipment

Plant and other equipment (comprising fittings and furniture) are initially recognised at

acquisition cost or manufacturing cost, including any costs directly attributable to bringing the assets

to the location and condition necessary for it to be capable of operating in the manner intended by

the Company’s management.

Plant and other equipment are subsequently measured using the cost model, cost less subsequent depreciation and impairment losses. Depreciation is recognised on a straight-line basis to write down the cost less estimated residual value of buildings, plant and other equipment. The following useful lives are applied:

• computer hardware: 3 years Material residual value estimates and estimates of useful life are updated as required, but at least annually. Gains or losses arising on the disposal of property, plant and equipment are determined as the difference between the disposal proceeds and the carrying amount of the assets and are recognised in profit or loss within other income or other expenses.

3.6 Income taxes No provision for income tax has been raised as the Company is exempt from income tax under Div 50 of the Income Tax Assessment Act 1997.

3.7 Current versus non-current classification The Company presents assets and liabilities in the statement of financial position based on current/non-current classification. An asset is current when it is:

• Expected to be realised or intended to be sold or consumed in the normal operating cycle

• Held primarily for the purpose of trading

• Expected to be realised within twelve months after the reporting period, or

• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period

All other assets are classified as non-current. A liability is current when:

• It is expected to be settled in the normal operating cycle

• It is held primarily for the purpose of trading

• It is due to be settled within twelve months after the reporting period, or

• There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period

The Company classifies all other liabilities as non-current.

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3.8 Financial instruments Recognition, initial measurement and derecognition Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the financial instrument, and are measured initially at fair value adjusted by transactions costs, except for those carried at fair value through profit or loss, which are initially measured at fair value. Subsequent measurement of financial assets and financial liabilities are described below. Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when the financial asset and all substantial risks and rewards are transferred. A financial liability is derecognised when it is extinguished, discharged, cancelled or expires.

3.9 Classification and subsequent measurement of financial assets For the purpose of subsequent measurement, financial assets other than those designated and effective as hedging instruments are classified into the following categories upon initial recognition:

• loans and receivables

• financial assets at Fair Value Through Profit Or Loss (‘FVTPL’)

• Held-To-Maturity (‘HTM’) investments;

• Available-For-Sale (‘AFS’) financial assets The category determines subsequent measurement and whether any resulting income and expense is recognised in profit or loss or in other comprehensive income. All financial assets except for those at FVTPL are subject to review for impairment at least at each reporting date to identify whether there is any objective evidence that a financial asset or a group of financial assets is impaired. Different criteria to determine impairment are applied for each category of financial assets, which are described below. All income and expenses relating to financial assets that are recognised in profit or loss are presented within finance costs or finance income, except for impairment of trade receivables which is presented within other expenses. Loans and receivables This category is most relevant to the Company. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. After initial recognition, these are measured at amortised cost using the effective interest method, less provision for impairment. Discounting is omitted where the effect of discounting is immaterial. The Company’s cash and cash equivalents, trade and most other receivables fall into this category of financial instruments. Individually significant receivables are considered for impairment when they are past due or when other objective evidence is received that a specific counterparty will default. Receivables that are not considered to be individually impaired are reviewed for impairment in groups, which are determined by reference to the industry and region of a counterparty and other shared credit risk characteristics. The impairment loss estimate is then based on recent historical counterparty default rates for each identified group. Financial assets at FVTPL

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Financial assets at FVTPL include financial assets that are either classified as held for trading or that meet certain conditions and are designated at FVTPL upon initial recognition. Assets in this category are measured at fair value with gains or losses recognised in profit or loss. The fair values of financial assets in this category are determined by reference to active market transactions or using a valuation technique where no active market exists. HTM investments HTM investments are non-derivative financial assets with fixed or determinable payments and fixed maturity other than loans and receivables. Investments are classified as HTM if the Company has the intention and ability to hold them until maturity. HTM investments are measured subsequently at amortised cost using the effective interest method. If there is objective evidence that the investment is impaired, determined by reference to external credit ratings, the financial asset is measured at the present value of estimated future cash flows. Any changes to the carrying amount of the investment, including impairment losses, are recognised in profit or loss. The Company did not have any HTM financial assets during the year ended 30 June 2014. AFS financial assets AFS financial assets are non-derivative financial assets that are either designated to this category or do not qualify for inclusion in any of the other categories of financial assets. All AFS financial assets are measured at fair value. Gains and losses are recognised in other comprehensive income and reported within the AFS reserve within equity, except for impairment losses and foreign exchange differences on monetary assets, which are recognised in profit or loss. When the asset is disposed of or is determined to be impaired the cumulative gain or loss recognised in other comprehensive income is reclassified from the equity reserve to profit or loss and presented as a reclassification adjustment within other comprehensive income. Interest calculated using the effective interest method and dividends are recognised in profit or loss within ‘revenue’ (see Note 3.2). Reversals of impairment losses for AFS debt securities are recognised in profit or loss if the reversal can be objectively related to an event occurring after the impairment loss was recognised. For AFS equity investments impairment reversals are not recognised in profit loss and any subsequent increase in fair value is recognised in other comprehensive income. The Company did not have any AFS financial investments during the year ended 30 June 2014. Classification and subsequent measurement of financial liabilities The Company’s financial liabilities include borrowings and trade and other payables. Financial liabilities are measured subsequently at amortised cost using the effective interest method, except for financial liabilities held for trading or designated at FVTPL, that are carried subsequently at fair value with gains or losses recognised in profit or loss. All interest-related charges and, if applicable, changes in an instrument’s fair value that are reported in profit or loss are included within finance costs or finance income.

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3.9 Cash and cash equivalents Cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value

3.10 Employee Benefits Short-term employee benefits Short-term employee benefits are benefits, other than termination benefits, that are expected to be settled wholly within twelve (12) months after the end of the period in which the employees render the related service. Examples of such benefits include wages and salaries, non-monetary benefits and accumulating sick leave. Short-term employee benefits are measured at the undiscounted amounts expected to be paid when the liabilities are settled. Other long-term employee benefits The Company’s liabilities for annual leave and long service leave are included in other long-term benefits as they are not expected to be settled wholly within twelve (12) months after the end of the period in which the employees render the related service. They are measured at the present value of the expected future payments to be made to employees. The expected future payments incorporate anticipated future wage and salary levels, experience of employee departures and periods of service, and are discounted at rates determined by reference to market yields at the end of the reporting period on high quality corporate bonds3 that have maturity dates that approximate the timing of the estimated future cash outflows. Any re-measurements arising from experience adjustments and changes in assumptions are recognised in profit or loss in the periods in which the changes occur. The Company presents employee benefit obligations as current liabilities in the statement of financial position if the Company does not have an unconditional right to defer settlement for at least twelve (12) months after the reporting period, irrespective of when the actual settlement is expected to take place.

3.11 Provisions, contingent liabilities and contingent assets Provisions are measured at the estimated expenditure required to settle the present obligation, based on the most reliable evidence available at the reporting date, including the risks and uncertainties associated with the present obligation. Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. Provisions are discounted to their present values, where the time value of money is material. Any reimbursement that the Company can be virtually certain to collect from a third party with respect to the obligation is recognised as a separate asset. However, this asset may not exceed the amount of the related provision. No liability is recognised if an outflow of economic resources as a result of present obligation is not probable. Such situations are disclosed as contingent liabilities, unless the outflow of resources is remote in which case no liability is recognised.

3.12 Goods and Services Tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Tax Office. In these circumstances, the GST is recognised

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as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the statement of financial position are shown inclusive of GST. Cash flows are presented in the statement of cash flows on a gross basis, except for the GST components of investing and financing activities, which are disclosed as operating cash flows.

3.13 Significant judgement in applying accounting policies When preparing the financial statements, the Company undertakes a number of judgements, estimates and assumptions about the recognition and measurement of assets, liabilities, income and expenses. Estimation uncertainty Information about estimates and assumptions that have the most significant effect on recognition and measurement of assets, liabilities, income and expenses is provided below. Actual results may be substantially different. Useful lives of depreciable assets Management reviews its estimate of the useful lives of depreciable assets at each reporting date, based on the expected utility of the assets. Uncertainties in these estimates relate to technical obsolescence that may change the utility of certain software and IT equipment. Going Concern The Company's financial statements have been prepared on a going concern basis, which contemplates continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business.

4 Employee Remuneration 4.1 Employee Benefits Expense

4.2 Employee Benefits

5 Funding to State Associations

2017 2016

$ $

Wages and Salaries 46,666 50,153

Superannuation 4,319 4,651

Employee Benefit Provisions 1,687 2,137

52,672 56,941

2017 2016

$ $

Current:

Annual Leave 3,825 2,137

3,825 2,137

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Funding is calculated on members who renew or join during the year who have a residential address in that state.

6 Cash and Cash Equivalents

7 Trade and Other Receivables All trade and other receivables are classified as current financial assets - loans and receivables.

Tax withheld from interest payments on Cash at Bank due to a Tax File Number not being provided to the bank. To be claimed back from the Australian Taxation Office.

8 Borrowings All borrowings are classified as current financial liabilities measured at amortised cost.

9 Trade and Other Payables All trade and other payables are classified as current financial liabilities measured at amortised cost.

2017 2016

$ $

New South Wales Kiteboarding Association Inc. 3,705 -

Kiteboarding Queensland & Northern Territory Inc. 1,880 -

South Australian Kitesurfing Association Inc. 2,316 -

Victorian Kite Boarding Association Inc. 3,018 -

Western Australia Kite Surfing Inc. 5,479 -

Tasmanian Kitesurfing Association Inc. - -

16,397 -

2017 2016

$ $

Cash at Bank 31,810 24,527

31,810 24,527

2017 2016

$ $

Accounts Receivable 3,650 493

TFN Withholding Tax 1,180 1,180

4,830 1,673

2017 2016

$ $

Macquarie Insurance Premium Funding 52,636 70,282

52,636 70,282

2017 2016

$ $

PAYG Withholdings Payable 1,872 3,646

Accounts Payable 4,231 1,874

GST Payable 5,682 2,619

Superannuation Payable 1,829 1,263

13,613 9,402

21

10 Plant and equipment Details of the Company’s plant and equipment and their carrying amount are as follows:

All depreciation and impairment charges (or reversals if any) are included within ‘depreciation and amortisation’ and ‘impairment of non-financial assets’.

11 Contingent liabilities There are no contingent liabilities that have been incurred by the Company in relation to 2017 or 2016.

12 Post-reporting date events No adjusting or significant non-adjusting events have occurred between the reporting date and the date of authorisation.

Asset Cost Opening Value Purchases Disposals Depreciation Closing Value

Laptop 978.00 670.70 - - 326.00 344.70

Total Computer Equipment 978.00 670.70 - - 326.00 344.70

Total 978.00 670.70 - - 326.00 344.70

Computer Equipment

22

Directors’ Declaration 1) In the opinion of the Directors of Kiteboarding Australia Limited:

a) The financial statements and notes of Kiteboarding Australia Limited are in accordance with

the Corporations Act 2001, including: i) Giving a true and fair view of its financial position as at 30 June 2017 and of its

performance for the financial year ended on that date; and ii) Complying with Australian Accounting Standards - Reduced Disclosure Requirements

(including the Australian Accounting Interpretations) and the Corporations Regulations 2001; and

b) There are reasonable grounds to believe that Kiteboarding Australia Limited will be able to

pay its debts as and when they become due and payable. Signed in accordance with a resolution of the Directors: Director Simon Savage Dated the 16th day of October 2017