For personal use only - Australian Securities Exchange2009/09/30 · Search Engine Optimisation and...

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Q LTD AND CONTROLLED ENTITIESABN 13 083 160 909

2009 ANNUAL REPORT

Table of Contents

Message from the Chairman

MD/CEO’s Review of Operations

Historical Financial Data

Company Profi le

Some of our Direct Clients

Financial Report

Corporate Governance Statement•

Directors’ Report•

Auditor’s Independence Declaration•

Financial Statements

Income Statement•

Balance Sheet•

Statement of Changes in Equity•

Cash Flow Statement•

Notes to Financial Statements•

Directors’ Declaration•

Independent Audit Report•

Additional Investor Information

Directory and Glossary

2009 Financial Report

This 2009 Financial Report is a summary of our activities and fi nancial position.

Reference in this report to a “year” is to the fi nancial year ended 30 June 2009 unless otherwise stated. All fi gures are expressed in Australian currency unless otherwise stated.

Revenues and expenses are recognised net of the amount of Goods and Services Tax.

A glossary of terms used in this Report is contained at the end of this document.

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97-98

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101-102

the digital marketing group

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Dear Fellow Shareholder,

On behalf of the Board of Directors, I am pleased to present to you the Annual Report of Q Ltd for the 2009 fi nancial year (FY 2009).

During the second half of FY 2009 we focused on re-structuring some of the business activities in the Group to take advantage of the opportunity provided by the end of the earn out periods for the acquisitions made by the Company during the previous three years.

The changes we are implementing as a result of this will lead the Group into providing a better outcome for our clients taking into account their changing needs as the digital market matures.

These efforts will result in improved profi t margins.

FY 2010 will be a period where we will primarily focus on organic growth.

I would like to thank my fellow Directors and committed management and staff for their time, effort and dedication during this last year.

I would also like to convey the Board’s thanks to our shareholders for your support in what has been a very challenging year for investors in small market cap companies. We look forward to a somewhat less challenging but more rewarding year in FY 2010.

Kevin V. Campbell AM

CHAIRMAN

14 September 2009

MESSAGE FROM THE CHAIRMAN


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1. Group OverviewI am pleased to report the full year results for the period from 1 July 2008 to 30 June 2009. FY 2009 was the second full fi nancial year of Q Ltd operating solely in digital marketing.

The Group’s result from continuing operations for FY 2009 was a profi t before tax of $774,000 compared to a profi t of $531,000 in FY 2008. One of the Company’s main areas of focus in FY 2009 was on streamlining its existing businesses to capitalise on cost syner-gies. This impacted positively on the bottom line improving EBIT by 93.4% from $351,000 in FY 2008 to $679,000 in FY 2009. The Group put a lot of focus on operating cash fl ow during this period, resulting in a total operating cash fl ow of $1,873,000.

Revenue growth was a modest 3.9% increase over FY2008 to $27.1m. Late in FY2009, the Group initiated a number of operational changes to evolve our offerings to match our clients’ changing needs and expectations in a maturing digital market. The changes are currently being implemented and are expected to result in an improved performance in FY2010.

Key QXQ Performance Statistics for Continuing Operations – excludes Axis Media discontinued in FY 2008

MD/CEO’S REVIEW OF OPERATIONS

CONTINUING OPERATIONS 2008/09$000

2007/08$000

Change%

Sales Revenue

Digital Marketing 27,117 26,099 3.9

Total Sales Revenue 27,117 26,099 3.9

Revenue From Other Sources

Digital Marketing 121 87 39.1

Corporate 56 137 (59.1)

Total Revenue From Other Sources 177 224 (21.0)

Total Revenue 27,294 26,323 3.7

EBITDA


Corporate (2,261) (1,621) 39.5

Total EBITDA 1,467 993 47.7

Less: Depreciation (788) (642) 22.7

EBIT 679 351 93.4

Net Interest Income 95 180 (47.2)

Net Profi t Before Tax 774 531 45.8

Income Tax Benefi t (expense) (389) 76 n/c

Net Profi t After Tax 385 607 (36.6)


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Continuing and Discontinued Operations – includes Axis Media in the comparatives

There is no difference between the results of the Company’s ‘continuing operations’ and its ‘continuing and discontinued operations” results in FY 2009. All costs associated with the discontinuing of Axis Media Pty Ltd were taken up in FY 2008.


CONTINUING AND DISCONTINUED OPERATIONS

2008/09$000

2007/08$000

Change%

Sales Revenue


Axis Media - 243 n/c

Total Sales Revenue 27,117 26,342 2.9

Revenue From Other Sources

Digital Marketing 121 87 39.1

Corporate 56 137 (59.1)

Total Revenue From Other Sources 177 224 (21.0)

Total Revenue 27,294 26,566 2.7

EBITDA


Discontinued - Axis - (1,609) n/c

Corporate (2,261) (1,621) 39.5

Total EBITDA 1,467 (616) (338.1)

Less: Depreciation (788) (650) 21.2

EBIT 679 (1,266) n/c

Net Interest Income 95 180 (47.2)

Net Profi t (Loss) Before Tax 774 (1,086) n/c

Income Tax Benefi t (expense) (389) 311 n/c

Net Profi t (Loss) After Tax 385 (775) n/c


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xqMD/CEO’S REVIEW OF OPERATIONS

2. Matching the needs of our clients

In July 2009 the Company announced a number of changes it was in the process of making to the Group’s businesses. Changes were undertaken for a number of reasons. The overrid-ing factor was to evolve our offering to match our changing client needs.

Investment in e-commerce and online marketing has reached giddy heights. Ironically the global fi nancial crisis seems to have increased the enterprise passion for pushing more process and promotion online. It seems obvious now that when times get tough businesses stop employing, look inward and seek out new ways to make processes and marketing spend more effi cient by driving business online.

Q Ltd has recognised this shift in the market and improved its offering accordingly. In July 2009 we introduced Thinq Digital Pty Ltd (thinq digital) a small group of specialist digital planners who share a common capability, an inbuilt skill to reach deep into the client’s business and pull out their marketing objectives, matching them to their ever changing customer needs and help them “thinq things through” before they allocate budget.

These “thinq’ers” know what it takes to make businesses work online. Yes it’s cliché but they’ve “been there and done that”, starting and running successful digital agencies helping some of the region’s leading brands devise digital assets and campaigns across a range of industries including gaming, fashion, fi nance, real estate, travel, education and automotive.

The client’s needs then shift from planning to delivery. Q Ltd’s digital agency, Market United has a team of 50+ individuals including account service, designers and developers spread across offi ces in Sydney, Perth and Auckland. The result is an unrivalled trans-Tasman web and campaign delivery capability. Dove-tailing the “thinq” team of planners, Market United is fully focused on turning the vision into a reality.

Sites and campaigns go live but their success still depends on how many people fi nd them. Search Engine Optimisation and Search Engine Marketing have never been in greater demand. It’s unusual to have a qualifi ed Search specialist working for a digital agency. First Rate is the trans-Tasman leader in search and performance, employing a team of 24 search specialists and managing Search Engine Optimisation and Adwords campaigns, for leading online businesses in Australia and New Zealand.

At Q Ltd we understand that, although important, not all internet traffi c is search traffi c. That’s why we provide clients with the opportunity to access our opt-in e-mail and mobile databases, display advertising inventory and performance networks from one easy point of sale. Our recently consolidated media sales business unit, 3dinteractive, delivers clients and agencies a central point of sales and traffi cking to some of Australia’s most in demand digital marketing opportunities.

And we’re not happy stopping there. As the digital marketing space matures, we under-stand that we must strive to control the media we represent. This is exactly why we are diversifying our interests into developing our own digital assets. With a team of 100+ strategists, designers and developers we are better placed than many to deliver. Introduc-ing “qed”, some of Q Ltd’s top people working together to produce our own valuable digital assets, create a following and profi t from the resulting traffi c.

When brought together, the businesses of thinq digital, Market United, First Rate, 3dinter-active and qed, provide an opportunity for clients to handle all their digital marketing needs from one agency group without sacrifi cing specialist capability.


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From a corporate perspective the end of the earn out arrangement in relation to the acquisi-tions made during the 2005 to 2007 period has also allowed us to undertake a number of changes which were diffi cult to make until now due to various restrictions and undertakings in the acquisition agreements. The ‘new look’ Q Ltd is now structured in two divisions. The ‘Digital Marketing Services’ division provides clients with four key service offerings:

Strategy (thinq)•

Agency – Design, Development & Online Media Planning/Buying (Market United)•

Agency – Search and Performance (First Rate)•

Media Sales (3Dinteractive)•

The second division, ‘Digital Assets’ which was formed on 1st July 2009, is charged with managing the Group’s digital assets, the ongoing enhancements of these assets and the devising and development of new digital assets.

The profi les of each of the business units which follow set out what each of them is doing to better address the changing needs of our clients.

3. Outlook

The Board is confi dent of improving the Group’s performance going forward. The Group will continue to focus on streamlining its existing businesses and pursuing organic revenue growth in FY 2010. In the absence of unforeseen circumstances or a deterioration in the Australasian economies, the Board expects to deliver an improved performance in FY2010.

4. Employees

I would like to welcome the new employees who joined the Group during FY 2009. I would also like to thank management and staff for their endeavours during this period. They have been instrumental in the Group achieving an improved fi nancial result during FY 2009.

Paul G Choiselat

MD/CEO

14 September 2009


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1. Subheading

Body copy2005/06

$0002006/07

$0002007/08

$0002008/09

$000

Sales Revenue 3,005 8,809 26,099 27,117

Other Revenue 26 188 224 177

Total Revenue 3,031 8,997 26,323 27,294

EBITDA Digital Marketing Profi t (Loss) 245 497 2,614 3,728

EBITDA Corporate Profi t (Loss) (561) (800) (1,621) (2,261)

Total EBITDA (316) (303) 993 1,467

EBIT Profi t (Loss) (336) (354) 351 679

NPBT (340) (192) 531 774

NPAT (339) 2,242 607 385

GROWTH DATA (YEAR ON YEAR) % % % %

Sales Revenue 193.1 196.3 3.9

Total Revenue 196.8 192.6 3.7

EBITDA - Digital Marketing 102.9 426.0 42.6

EBITDA - Total 4.1 427.7 47.7

EBIT 5.4 199.2 93.4

NPBT 43.5 376.6 45.8

NPAT 761.4 (72.9) (36.6)

MARGIN DATA

EBITDA Digital Marketing/Sales Revenue 8.2 5.6 10.0 13.7

EBITDA Total/Sales Revenue (10.5) (3.4) 3.8 5.4

NPBT/Sales Revenue (11.3) (2.2) 2.0 2.9

NPAT/Sales Revenue (11.3) 25.5 2.3 1.4

HISTORICAL FINANCIAL DATA


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HISTORICAL FINANCIAL DATA

Q Ltd - Continuing Operations Sales Revenue ($000’s)Actuals: July 2005 - June 2009

30,000

25,000

20,000

15,000

10,000

5,000

0 2005/06 2006/07 2007/08 2008/09

1,500

1,200

900

600

300

0

-300

-600 2005/06 2006/07 2007/08 2008/09

Q Ltd - Continuing Operations EBITDA ($000’s)Actuals: July 2005 - June 2009


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History

Established 1st July 2009•

Key Services Offered:

Complete digital strategy development•

Website and systems planning•

Systems analysis and vendor selection•

Online Media Strategy•

Client and Agency Education•

Taking advantage of changing digital markets and clients

Supports the clients who want to be further educated about opportunities for them in the • constantly changing digital market

thinq digital has recruited a social media strategist from a New York advertising agency • to help support our clients’ needs to take advantage of social media opportunities.

COMPANY PROFILE

1. Divisional Structure

2. Digital Marketing Services Division

Digital Marketing Services

Digital Assets

Q Ltd Group

Media Sales3D Interactive

Agency - SearchFirst Rate

Agency - DevelopmentMarket United

Strategythinq digital

Digital Marketing Services Division


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COMPANY PROFILE

History

Established in 2002•

Acquired by Q Ltd in 2007•

Clear Blue Day and Freestyle Media merged into Market United 1st July 2009•


Creative solutions•

Web and mobile technology solutions•

Online media planning and buying•

Account and project management•

Design and build websites and hard-core systems•

Traffi c acquisition, conversion and retention of client’s customers•

Develop campaign strategies•

Create and design online advertising•

Develop campaign systems, sites and evaluate the performance of a client’s campaign•

website usability research•


The merger of the three development agencies into one will centralise all Group’s knowl-• edge, making it accessible to all clients giving them the best in:

- Technology

- Online marketing support

CEO – Marc Loveridge

Joint founder of Market United in 2002•

11 years experience across:•

- Online gaming

- Finance

- Government

- Education

- Entertainment

- Retail

Specialist in online media strategy•

thinq digital has offi ces in Perth and Sydney.

www.thinqdigital.com.au


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COMPANY PROFILE

CEO Perth – Sandra Riches

Six years with Market United (since business inception), made CEO July 2009•

Instrumental in the sustainable growth of Market United from 3 to 34 staff over 6 years•

Growing and motivating a very diverse team of marketing, technical and design personali-• ties by developing the “MU way” – a positive and honest way of working with our clients

Identifying and developing new digital marketing services in line with industry changes • and client requirements

Ensuring quality and innovation are maintained throughout the business•

10 years experience across:•

- On-line marketing

- Strategy

- Account Direction

CEO Sydney – James Ward

12 years in the online industry and during that time has overseen the deployment of • some of the largest web builds undertaken in the Australian market place including sub-stantial builds on the Ninemsn Network, The Encyclopedia Britannica Australia website, the Law and Justice Foundation website, The Macmillan Publishers Australia website , the Virgin Broadband website and the full suite of Sanitarium websites.

Managed the build of some of the largest software engines developed in the Australian • market including the edDesk content management system, Enterdraw Software System and Media Kit Builder software.

James has held a variety of senior management positions in the Internet and IT • industries over the last 8 years and brings extensive experience in business strategy, business growth management and HR strategies.

Creative Director – Lachlan Pottenger

Professional designer since 1994•

Experience with digital design and development since 1998•

Creative Direction and Design•

User Interface Design•

Information Architecture and Usability•

Illustration and Photography•

Team and Project Management•

Market United has offi ces in Perth, Sydney and Auckland

www.marketunited.com | www.digitalagency.com.au | www.freestylemedia.com.au


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COMPANY PROFILE

History

Established in 1999 by Jon Ostler•

Acquired by Q Ltd in 2006•


• Search Engine Optimisation (SEO)

• Search Engine Marketing (SEM)

• Performance Marketing

• Analytics


SEO focus is on ensuring that a client’s site is found by an organic search on search • engines

SEM and Performance Marketing focus on the client only paying for advertising and • marketing based on the success of the communications to its customer.

CEO Auckland – Kevin Francis

Joined First Rate as GM NZ in 2006 and has held roles as GM First Rate NZ/Au, COO • First Rate NZ/Au and was appointed CEO of Q NZ on July 1 2009.

Over 20 years in leadership roles in the information technology, telecommunications, • internet and online industries.

Specialises in change management, business development, people excellence and • leadership.

Graduate of the Royal Military Academy, Sandhurst.•

7 years as an offi cer in the Royal Signals, including operational command in the Gulf War • (90-91).

Previous roles include GM Ericsson Enterprise, GM Asia Online.•

Chemistry BSc (Hons) from the University of Bristol.•

CEO Sydney – James Ward

12 years in the online industry and during that time has overseen the deployment of • some of the largest web builds undertaken in the Australian market place including sub-stantial builds on the Ninemsn Network, The Encyclopedia Britannica Australia website, the Law and Justice Foundation website, The Macmillan Publishers Australia website , the Virgin Broadband website and the full suite of Sanitarium websites.

Managed the build of some of the largest software engines developed in the Australian • market including the edDesk content management system, Enterdraw Software System and Media Kit Builder software.

James has held a variety of senior management positions in the Internet and IT • industries over the last 8 years and brings extensive experience in business strategy, business growth management and HR Strategies.

First Rate has offi ces in Sydney and Auckland.

www.fi rstrate.com.au | www.fi rstrate.co.nz


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COMPANY PROFILE

History

Established in 2003 by Mark Halstead• Acquired by Q Ltd in 2005• List Marketing Australasia Pty Ltd merged into 3di on 1st July 2009• The Great Australian Survey Pty Ltd sales team merged into 3di on 1st July 2009• Mosaic Traffi c Pty Ltd merged into 3di on 1st July 2009•

About 3di

3di is an interactive advertising sales network that provides sales representation for a network of Australasia’s premier permissioned databases and digital media properties, to advertising agencies and their clients.

A team of specialist sales people who passionately believe the future of advertising is in media which provide interactivity between a brand and consumer. The center of our experi-ence is data marketing, marketing to consumers via data available to us through permis-sioned databases and traditional direct marketing data.


Digital media sales representation – website, email, mobile • Email and mobile marketing • Performance media• Digital media sales representation –email and mobile lists • Direct marketing representation – List Marketing, business, fax, mail, telemarketing • List Management• Adverting Operations (Traffi cking) for Publishers and Clients• Campaign Management•


Focus on email marketing using profi led databases• Website advertising sales representation including performance based advertisements•

CEO Mark Halstead

Mark Halstead, BSc, MAICD• Managing Director – 3di • Executive Director – Q Ltd• Mark has 17 years experience in media, advertising and sales, and over 10 years of that • time has been spent in the digital and interactive advertising industry.Mark established interactive media sales network 3di in 2003. The company has grown • to a staff of 30 with offi ces in Sydney, Melbourne, Perth and Auckland. This team is a recent amalgamation of other Q Ltd Group companies List Marketing Australasia Pty Ltd, Mosaic Traffi c Pty Ltd and The Great Australian Survey Pty Ltd sales team.3di was sold to Q Ltd in 2005. Mark is on the board of directors of Q Ltd and is also a • director of each of the Group companies.Mark began his career in London working as group sales manager for channel 5 broad-• casting. He also helped launch two pay TV Channels, UK Gold and UK living.

3D interactive has offi ces in Sydney, Melbourne, Perth and Auckland

www.3dinteractive.com.au | www.listmarketing.com.au | www.mosaictraffi c.com.au


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COMPANY PROFILE

History

Established 1st July 2009•

Existing Group digital assets forming part of this division•

- The Great Australian Survey

- The Great New Zealand Survey

- The Great UK Survey

The Performance Network (TPN)•

a) qed Activities – Existing Digital Assets

The Great Australian Survey Pty Ltd (“Aussie Surveys”):

About GAS

The Great Australian Survey is a leader in the collection of detailed demographic, lifestyle and purchasing data of consumers in Australia, New Zealand and the United Kingdom, providing opt-in data for the market research and direct marketing industries. This informa-tion gives advertisers, marketers and researchers the ability to deliver highly targeted and effi cient direct-to-consumer marketing communications.


Permissioned data driven advertising campaigns•

Cost effective targeting, capturing and interaction with select groups of highly qualifi ed • consumers either online, offl ine or via mobile communications.

} GAS

3. Digital Assets Division

Permissioned Databases

The Great Australian Survey•

The Great New Zealand Survey•

The Great UK Survey•

Other Digital Assets

The Performance Network•

Digital Assets Division


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COMPANY PROFILE


Increasing the size of the GAS B2C (Business to Consumer) databases•

Introducing new ‘vertical’ approach to B2C databases•

Introducing a B2B (Business to Business) database. •

CEO GAS – Aaron O’Sullivan

Prior to The Great Australian Survey, Aaron founded and was Managing Director of • ipoints (www.ipoints.co.uk) which grew to become one of the largest online rewards programmes in Europe with over 1 million members.

ipoints has since been purchased by the French listed company maximiles (www.• maximiles.com) to become the largest pan-European rewards programme and one of the largest of its type in the world.

Founded The Great Australian Survey (www.aussiesurveys.com.au) in 2004 and has • been Managing Director of the business since inception.

During that time he has launched the business into 3 countries (Australia, New Zealand • and The United Kingdom) and has grown the company to become one of the leading data providers for the Direct Marketing and Market Research industries in its respective countries of operation.

In 2007 he sold the business to Q Ltd and was retained as CEO of the business.•

Aussie Surveys has offi ces in Sydney.

www.aussiesurveys.com.au | www.kiwisurveys.co.nz | www.greatuksurveys.co.uk

History

Established in NZ in 2006•

About TPN-NZ

1st New Zealand Performance Ad Network•

Performance marketing is at an early stage of growth in NZ•

Spend expected to grow as a % of online marketing in line with global trends•

TPN system to be enhanced to meet the requirements of a maturing market•

About TPN-Australia

Enhanced system will provide TPN with the ability to launch in Australia•

3dinteractive will provide a key sales channel •

Enhanced system is intended to compete with and outperform current established • performance ad networks in the market


Facilitating ‘performance’ advertising between advertisers and web sites•

New and improved version launching in New Zealand on 1 September 2009•

Launch into the Australian market in late September 2009•

TPN has offi ces in Auckland and Sydney

www.tpn.co.nz | www.tpn.com.au

The Performance Network (‘TPN’)


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COMPANY PROFILE

b) qed activities – New Digital Assets

2009/10 Focus

Increasing the Group’s ownership of permissioned data by developing new digital assets • to facilitate member acquisition

Developing and launching improved version of The Performance Network (TPN) in New • Zealand and Australia.


Devise, develop and grow profi table web assets owned by Q •

Utilising 100+ digital experts within Q to assist the process:•

- Strategy

- Creative

- Development

- Marketing

- Sales

- Operations

- Finance

Supported by Q’s infrastructure (Auckland, Melbourne, Perth, Sydney)•

Complementary to Q’s clients and partners •

Building on and adding to Q success stories•

CEO qed - Jon Ostler

Jon is CEO of QED (QEDigital.com) a subsidiary of Q Ltd and is responsible for devising, • developing and growing profi table web assets owned by Q. These include email lists, ad networks and other internet based businesses.

Jon has founded, operated and sold a number of successful web related businesses • including a web design business, an online restaurant guide, performance ad network and most notably First Rate, a leading specialist in search and performance marketing with offi ces in Auckland and Sydney.

First Rate grew rapidly and consistently over 9 years and was listed in the Deloitte Fast • 50 three years in a row (2006/07/08).

Jon sold First Rate to Q Ltd in 2007.•

Jon has been a regular speaker at internet related conferences for more than 10 years • and is widely respected as an expert in online marketing.

Jon is originally from the UK where he graduated top of his class with a 1st class degree • in Communication Engineering (BEng) before taking up a technical management role with JARIC a military intelligence department of the UK Ministry of Defence.

Jon has been based in New Zealand for the last 11 years but also spends a large amount • of his time in Australia.

qed has offi ces in Auckland and Sydney

www.qedigital.com


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SOME OF OUR DIRECT CLIENTS


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CORPORATE GOVERNANCE STATEMENT

In August 2007, the ASX Corporate Governance Council released the second edition of the ASX Corporate Governance Principles and Recommendations (ASXCGPR) which replaces the ASX Best Practice Recommendations issued in March 2003. In addition, during December 2007, the ASX reissued Guidance note 9A “Corporate Governance – ASX Corporate Governance Council – Revised Corporate Governance Principles and Recommendations” to include discussion of the revised Principles. This is to ensure that the Principles and Recommendations remain relevant to the Australian business and investment communities, taking into account local and international developments, and continue to refl ect international best practice. These recommendations are guidelines designed to produce an effi ciency, quality or integrity outcome. The recommendations are not prescriptive so that if a Company considers that a recommendation is inappropriate having regard to its particular circumstances, the Company has the fl exibility not to follow it. When a Company has not followed all the recommendations, the annual report must identify which recommendations have not been followed and give reasons for not following them. In this respect, the Directors of Q Ltd have evaluated with due care the situation of Q Ltd and have strived to comply, to the best possible extent, with the guidelines laid down.

The Directors recognise the need for a high standard of behaviour and accountability and accordingly support good corporate governance practices. In general, the Board considers that adequate measures have been taken in the areas of board structure and responsibility, timely and adequate disclosure in the best interests of shareholders, minimizing risk by reinforcing internal controls as well as overall compliance with the ASX Listing Rules.

On self-evaluation of the extent to which Q Ltd has followed the ASXCGPR, the Board is of the opinion that, subject to certain departures which were justifi ed for adoption due to the particular circumstances of Q Ltd, our policies and practices are in compliance with the ASXCGPR. Details of the extent to which Q Ltd has followed the ASXCGPR have been included at the end of this statement.

1. Q Ltd Board of Directors To comply with the ASXCGPR, Q Ltd has established clear guidelines to distinguish between the roles of the Board

and that of management.

In essence, the Board is responsible for the overall strategic planning and decision making of the Company as a whole and answerable to the shareholders for the business performance of Q Ltd and its controlled entities. Management on the other hand is delegated with all the functions in relation to the day-to-day operations of Q Ltd and is accountable to the Board in this respect.

The Board of Directors is responsible for protecting the rights and interests of members and is accountable to them for the overall management of Q Ltd. The Board has the overall responsibility for the governance of Q Ltd, including:

Setting strategies, directions and establishing goals for the Group; The monitoring of performance against these goals and objectives; Oversight of Q Ltd including control and accountability systems; Ensuring there are adequate internal controls and ethical standards of behaviour; The review of the CEO and other Key Management Personnel performance, conduct and reward; The monitoring of the major risks of Q Ltd’s business and ensuring there are appropriate policies and procedures to satisfy its legal and ethical responsibilities;The approval and monitoring of fi nancial and other reporting; Approving all mergers and acquisitions; Reviewing the annual progress and performance of Q Ltd in meeting the objectives of the Group, including reporting the outcome of such reviews;Establishing and determining the powers and functions of the committees of the Board; The review and approval of the major operational and capital expenditure plans established by the management team, and the monitoring of performance against those plans.

The content of a director’s letter upon appointment will be refl ective of the responsibilities as listed as board responsibilities under Principle 1 of ASXCGPR.

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2. Board structure Q Ltd recognises the need to have a board of the appropriate composition, size and commitment with an appropriate

range of expertise, skill, knowledge and vision to enable it to operate the Company’s business with excellence. With this objective in mind, our board is structured to consist of fi ve (5) Directors of which three (3) are independent Non-Executive Directors including the Chairman.

The composition of the Board is determined by Q Ltd using the following principles:

The Board should comprise at least three Directors. This number may be increased where it is felt that additional expertise is required in specifi c areas.The Chairman of the Board is an independent Non-Executive Director. The Board comprises not less than half independent Non-Executive Directors. The Board has enough Directors to serve on various committees of the Board without overburdening the Directors or making it diffi cult for them to fully discharge their duties.The Board comprises Directors with a broad range of expertise both nationally and internationally.

Details of the Directors are found in the Directors’ Report. The Board has signifi cant experience in various fi elds, including funds management, media, printing, telecommunications, fi nancial markets and accounting. During FY2009, the Board met 15 times.

The Board’s composition of fi ve Directors is considered an appropriate size for the Company at its present stage of development and given the breadth of its membership, most issues can be decided at Board level without the need for separate committees such as a nomination committee. The full Board incorporates the responsibilities of the Nomination Committee. It has the responsibility for reviewing the composition of the Board and recommending new nominees for membership of the Board, should the need arise. The selection of Directors must be approved by the majority of shareholders at the next AGM.

The Chairman reviews the performance of all Directors each year. Directors whose performance is unsatisfactory are asked to retire. To date, no Director has been asked to retire for unsatisfactory performance.

Each year the Board conducts an evaluation review of the Directors. The evaluation is carried out by a review as a whole of a Director’s attendance at and involvement in Board meetings, their performance and other matters identifi ed by the Board or other Directors. Signifi cant issues are dealt with immediately by the Board. Due to the Board’s assessment of the effectiveness of these processes, the Board has not otherwise formalised measures of a Director’s performance.

The Board assesses the independence of Directors as appropriate. In considering whether a Director is independent, the Board has regard to the independence criteria in ASXCGPR Principle 2 and other facts, circumstances and information the Board considers relevant.

3. Director Participation Directors of Q Ltd are expected to regularly visit the business offi ces of Q Ltd and meet with management to gain

a better understanding of business practices.

4. Committees of the Board To assist in the execution of its corporate governance responsibilities, the Board has established four (4) committees,

the Audit Committee, the Remuneration Committee, the Corporate Governance Committee and the Acquisition and Finance Committee. Requirements for Board committees are reviewed regularly. All committees operate principally in a review or advisory capacity, except in cases where powers are expressly conferred on or delegated to a committee by the Board.


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4.1 Audit Committee The Board has established an Audit Committee that 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 entity. This includes internal controls to deal with both the effectiveness and effi ciency of signifi cant business processes.

This includes the safeguarding of assets, the maintenance of proper accounting records, the monitoring of risks and the reliability of fi nancial information as well as non-fi nancial considerations such as the benchmarking of operational key performance indicators. The Board has delegated the responsibility for the establishment and maintenance of a framework of internal control and ethical standards for the management of the economic entity to the Audit Committee. The Committee also provides the Board with additional assurance regarding the reliability of fi nancial information for inclusion in the fi nancial statements.

The Committee comprises two Non-Executive Directors and the MD/CEO. The members of the Audit Committee during the year were Hon Jeffrey G Kennett (chair) who resigned on 20 October 2008, Andrew HS Koo (chair) who was appointed 20 October 2008, Kevin V Campbell and Paul G Choiselat. Full details and qualifi cations of the members are contained in the Directors’ Report. All members are experienced in executive management, public Company management and fi nance. The Chair of the Audit Committee is not the chairman of the Board. The external auditors and the CFO are invited to Audit Committee meetings at the discretion of the Committee. The Committee met twice during the year. Attendance at the meetings is set out in the Directors’ Report.

The Audit Committee is also responsible for directing and monitoring the internal audit function, nomination of the external auditor, monitoring the independence of the external auditor and reviewing the adequacy of the scope and quality of the annual statutory audit or review. The Committee is expected to review the performance of the external auditors on an annual basis and meet regularly with them during the year.

4.2 Remuneration CommitteeThe Remuneration Committee is responsible for reviewing the remuneration of Directors and other Key Management Personnel, evaluating Key Management Personnel and making recommendations to the Board on these matters. This role also includes responsibility for recommendations to the Board on share and option schemes, incentive performance packages, superannuation entitlements and fringe benefi ts policies.

Remuneration levels are competitively set to attract the most qualifi ed and experienced Directors and Key Management Personnel. The Committee is authorized to obtain independent advice on the appropriateness of remuneration packages. The Committee comprises Bruce R Bennie, Kevin V Campbell and Paul G Choiselat. The Committee met once during the year. Attendance at the meetings is set out in the Directors’ Report.

Details of the amount of remuneration, and all monetary and non-monetary components, for each of the Key Management Personnel during the year ending 30 June 2009 are contained in Table A of the Remuneration Report included in the Directors’ Report. Termination entitlements for Key Management Personnel, if any, are also contained in Table A.

Non-Executive Directors are remunerated by way of fees and are not provided with retirement benefi ts.

4.3 Corporate Governance Committee The Corporate Governance Committee is responsible for reviewing the corporate governance policies and

procedures. The Committee conducts or facilitates the conduct of formal annual reviews of the internal guidelines relating to corporate governance, Board operation and membership and committee structures. This process ensures not only that the functions of board and management are clearly defi ned and understood but also that Q Ltd’s Board procedures are continually reviewed and the highest standards of performance are maintained.

The Committee comprises Andrew HS Koo, Hon Jeffrey G Kennett (resigned 20 October 2008), Kevin V Campbell and Paul G Choiselat. The Committee did not meet during the year but corporate governance matters were discussed by the full Board at a number of meetings during FY2009. Attendance at the meetings is set out in the Directors’ Report.

4.4 Acquisitions and Finance Committee

The Acquisition and Finance Committee was established by the Board in September 2006. The Committee is responsible for guidance and overseeing acquisition activities including identifying targets, conduct of the due diligence process and all related fi nancing issues including raising equity and debt. The Committee comprises of Kevin V Campbell, Paul G Choiselat, Mark Halstead and Andrew HS Koo


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5. Access to Independent Professional Advice The Directors, the Board and the Board Committees are empowered to seek external professional advice, as

considered necessary, at Q Ltd’s expense, subject to prior consultation with the Chairman. If appropriate, any advice so received will be made available to all Directors.

6. Access to Information Directors are entitled to obtain access to Company employees, documents and information.

7. Risk Management Q Ltd is committed to a high standard of service delivery to its clients and sound corporate governance which

includes the management of risk areas. As such the Board recognises a responsibility to continuously identify strategic and operational risks and believes that effective risk management practice is central to its continued growth and long-term success.

Risk management matters are continuously under Board and MD/CEO review and key areas of our existing system are currently being upgraded. These changes will include:

An upgraded organisation-wide risk framework consistent with the AS/NZS 4360:2004, Australian Risk − Management Standard;Regular risk profi le reporting from an online risk database with summary and detailed reporting as − appropriate;Updated defi nition of management responsibilities for managing risks and tracking agreed risk actions.−

These enhancements aim to:Further develop an organisational view and awareness of risk at all levels;− Fully integrate risk management practices of the Company’s recent acquisitions with those of the Company − and the Company’s other processes such as strategic planning;Ensure that the application of risk management adds value to our services; and− Continuously identify opportunities for improvement in work practice and provide a driver for innovation.−

Q Ltd is in the process of upgrading its previously established control framework to respond to risk. Key elements include:

Ongoing monitoring of strategic risk including external infl uences and changes;− Financial management reporting including monitoring key performance indicators;− Procedures to manage fi nancial and compliance risks; and− Recovery procedures for critical infrastructure and systems including comprehensive insurance − arrangements.

Q Ltd assures itself on risk matters on a regular basis. Assurance reporting includes regular MD/CEO performance reports to the Board, non-compliance reporting, and the results of our internal and external audits. Any information relevant to material risks is reported as a matter of urgency and priority.

The MD/CEO and CFO annually provide a formal statement to the Board that in all material respects and to the best of their knowledge and belief:

Q Ltd’s fi nancial reports present a true and fair view of Q Ltd’s fi nancial condition and operational results and • are in accordance with relevant accounting standards; andQ Ltd’s risk management and internal control systems are sound, appropriate and operating effi ciently and • effectively.

The Board acknowledges that it is responsible for the overall internal control framework but recognises that no cost effective internal control system will preclude all errors and irregularities. The system is based upon written procedures, policies and guidelines, organisational structures that provide an appropriate division of responsibility, a program of internal risk assessment activities and the careful selection and training of qualifi ed personnel. In FY 2010 the board has also committed to external parties to assist in the upgrade of the Group’s organisation-wide risk framework.


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8. Ethical StandardsThe Directors acknowledge the need for and continued maintenance of the highest standards of corporate governance practices and ethical conduct by all Directors and employees of Q Ltd. All Directors, Executives and employees are expected to act with the utmost integrity and objectivity in their dealings with each other, competitors, suppliers, customers, and the community, aiming at all times to enhance the reputation and performance of Q Ltd.

Q Ltd has adopted a Code of Conduct which sets standards of behaviour required of all employees including:

to act properly and effi ciently in pursuing the objectives of Q Ltd;• to avoid situations which may give rise to a confl ict of interest;• to know and adhere to Q Ltd’s policies;• to maintain confi dentiality in the affairs of Q Ltd and its customers;• to be absolutely honest in all professional activities.•

These standards are regularly communicated to staff and Directors and are accepted and agreed to by all.

Political contributions as a rule are not allowed by Q Ltd. Sponsorships undertaken by Q Ltd are aligned with the achievement of corporate objectives.

In accordance with the Constitution and the Corporations Act 2001, Directors disclose to the Board any material contract in which they may have an interest. In compliance with section 195 of the Corporations Act 2001 any Director with a material personal interest in a matter being considered by the Board will not be present when the matter is being considered and will not vote on the matter.

9. Dealings in Q Ltd securities Q Ltd has a Share Trading Policy in place which regulates the trading of shares in Q Ltd by Directors and

employees.

10. Continuous Disclosure Procedures and practices are in place to ensure compliance with the continuous disclosure requirements of the

ASX Listing Rules. Continuous disclosure involves the timely announcement of information to keep the market informed of material events and developments as they occur.

Once the Board becomes aware of information concerning Q Ltd that would be likely to have a material effect on the price or value of Q Ltd’s securities, the Board ensures that the information is released to the ASX.

The Company Secretary must ensure that information for release to the market is not released to any other person until Q Ltd has given the information to the ASX and has received an acknowledgement that the ASX has released the information to the market.

11. Shareholders The Board aims to ensure that shareholders are kept informed of all major developments affecting Q Ltd.

Information is communicated to shareholders as follows:

regular announcements are made to the ASX, including the half-year fi nancial report and the year end audited • annual report;continuous disclosure releases made to the ASX;• the Board ensures the annual report includes relevant information about the operations of Q Ltd during the • year, changes in the state of affairs and details of future developments;the Board encourages full participation of shareholders at the Annual General Meeting to ensure a high level • of accountability and identifi cation of Q Ltd’s strategies and goals. All shareholders who are unable to attend these meetings are encouraged to communicate or ask questions by writing to Q Ltd; andthe external auditor is requested to attend the Annual General Meetings to answer any questions concerning • the audit and the contents of the Independent Audit Report.


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12. Interests of stakeholdersQ Ltd acknowledges the obligation it has towards stakeholders such as shareholders, customers, employees, suppliers and the community it serves. To fulfi l its obligations, Q Ltd strives to observe the laws, act in the best interests of shareholders, manage the Company’s assets properly, act in a highly professional way and promote a good corporate image among the industry.

13. Privacy Q Ltd has developed and introduced a privacy policy following the implementation of the Privacy Act in December

2001 which deals with:

collection of information• disclosure of information• storage of information• security• access to and correction of information.•

14. EnvironmentThe Board considers that responsible environmental management is important in Q Ltd. Q Ltd is making efforts to reduce its environmental impact. Areas that have been concentrated on are the reduction of energy consumption, the use of environmentally friendly products, the minimisation of waste, and increasing recycling efforts.

15. Registry Computershare Investor Services Pty Limited is Q Ltd’s security register manager and is responsible for maintaining

and holding all shareholder records electronically.

Compliance with The ASX Corporate Governance Principles and RecommendationsThe extent to which Q Ltd has followed the ASXCGPR are as follows:

PRINCIPLE 1: LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT

Compliance Corporate Governance Statement (CGS) References/Comments

1.1 Formalise and disclose the functions reserved to the Board and those delegated to management.

Yes 1, 2

1.2 Content of a director’s letter upon appointment. Yes 1

1.3 Formalise and disclose the process for evaluating the performance of management.

Yes 4.2

1.4 Provide the information indicated in Guide to reporting in Principle 1.

Yes Annual Report

CGS

PRINCIPLE 2: STRUCTURE THE BOARD TO ADD VALUE

2.1 A majority of the Board should be independent Directors.

Yes 2

2.2 The Chairperson should be an independent director.

Yes 2

2.3 The roles of chairperson and chief executive offi cer should not be exercised by the same individual.

Yes 2


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2.4 The Board should establish a nomination committee. No The functions to be performed by a nomination committee under the ASXCGPR are currently performed by the full Board. Having regard to the number of members currently comprising the Board, the Board does not consider it necessary to delegate these responsibilities to a sub-committee. These arrangements will be reviewed periodically by the Board to ensure that they continue to be appropriate to Q Ltd’s circumstances.

2.5 Formalise and disclose the process for evaluating the performance of the Board, its committees and individual Directors.

Yes 2

2.6 Provide the information indicated in Guide to reporting on Principle 2.

Yes Annual Report

Website

CGS

PRINCIPLE 3: PROMOTE ETHICAL AND RESPONSIBLE DECISION-MAKING

3.1 Establish a Code of Conduct to guide the Directors, the chief executive offi cer (or equivalent), the chief fi nancial offi cer (or equivalent) and any other key executives as to:

Yes

Yes

Yes

Yes

8

3.1.1 The practices necessary to maintain confi dence in the Company’s integrity.

3.1.2 The practices necessary to take into account their legal obligations and the reasonable expectations of their stakeholders.

3.1.3 The responsibility and accountability of individuals for reporting and investigating reports of unethical practices.

3.2 Disclose the policy concerning trading in Company securities by Directors, offi cers and employees.

Yes 9


Yes Annual Report

Website

CGS


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PRINCIPLE 4: SAFEGUARD INTEGRITY IN FINANCIAL REPORTING

4.1 The Board should establish an audit committee. Yes 4.1

4.2 Structure the audit committee so that it consists of:

Only non-executive Directors.•

A majority of independent Directors.•

An independent chairperson, who is not chairperson • of the board.

At least three members.•

No

Yes

Yes

Yes

The Audit Committee currently comprises 2 Non-Executive Directors and the MD/CEO. Having regard to the number and expertise of members currently comprising the Board, the Board does not consider it appropriate to exclude the MD/ CEO. However, the non-executive members of the Audit Committee are provided with an opportunity to meet with the external auditors without the MD/CEO and management. These arrangements will be reviewed periodically by the Board to ensure that they continue to be appropriate to Q Ltd’s circumstances.

4.3 The audit committee should have a formal charter. Yes 4.1


Yes Annual Report

Website

CGS

PRINCIPLE 5: MAKE TIMELY AND BALANCED DISCLOSURE

5.1 Establish written policies and procedures designed to ensure compliance with ASX Listing Rule disclosure requirements and to ensure accountability at a senior management level for that compliance.

Yes 10


Yes Annual Report

CGS

PRINCIPLE 6: RESPECT THE RIGHTS OF SHAREHOLDERS

6.1 Design and disclose a communications strategy for promoting effective communication with shareholders and encouraging participation at general meetings.

Yes 11, 12


Yes Annual Report

Website

CGS


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PRINCIPLE 7: RECOGNISE AND MANAGE RISK

7.1 The Board or appropriate Board committee should establish and disclose policies on risk oversight and management.

Yes 7

7.2 Management to design and implement a risk management and internal control system to manage the Company’s material business risks. The Board to disclose that management has reported to the Board in writing that:

The Company’s risk management and internal • compliance and control system is operating effi ciently and effectively in all material respects.

Yes 7

7.3 The Board to disclose that the CEO (or equivalent) and the CFO (or equivalent) have provided to the board in writing that:

The declaration provided in accordance with • Section 295A of the Corporations Act is founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to fi nancial reporting risks.

Yes 7


Yes Annual Report

CGS

PRINCIPLE 8: REMUNERATE FAIRLY AND RESPONSIBLY

8.1 The Board should establish a remuneration committee. Yes 4.2

8.2 Clearly distinguish the structure of non-executive Directors’ remuneration from that of executives.

Yes Annual Report


Yes Annual Report

CGS


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DIRECTORS’ REPORT

Your Directors present their report on Q Ltd together with the fi nancial statements of the Group, being the Company and its controlled entities, for the year ended 30 June 2009.

Directors and Offi cersThe Board of Directors (Board) has power to appoint persons as Directors to fi ll any vacancies. Other than the Managing Director and those Directors appointed during the year, one-third (or the nearest number to) are required to retire by rotation at each Annual General Meeting and are eligible to stand for re-election together with those Directors appointed during the year to fi ll any vacancy who must retire and stand for election.

The names of the Company’s Directors in offi ce during or since the end of the fi nancial year are as follows:

Kevin V Campbell AM Chairman and Non-Executive DirectorPaul G Choiselat Executive Director (MD/CEO)Hon Jeffrey G Kennett AC Non-Executive Director (resigned 20 October 2008)Bruce R Bennie Non-Executive DirectorAndrew HS Koo AM Non-Executive DirectorMark Halstead Executive Director (Managing Director 3 Dimension Interactive Pty Ltd)

Each of the above Directors other than Hon Jeffrey G Kennett AC, has been in offi ce for the entire fi nancial year and up to the date of this report.

Details of Directors of the Company in offi ce at the date of this report, and each Director’s qualifi cations, experience and special responsibilities are below.

Kevin V Campbell AM Age: 65Chairman (non-executive) Board member and Chairman since January 2000, Mr Campbell has had an

extensive and diverse career in the broadcasting industry in Australia for over thirty-eight years and has experience in media technology. He is a former Executive Chairman of TVW Enterprises Ltd, Perth and a former Chairman of the Lotteries Commission of Western Australia. He was the Chairman of Jumbuck Entertainment Ltd and retired October 2008, Chairman of Quickfl ix Ltd and immediate past Chairman of the Telethon Institute for Child Health Research. Mr Campbell is also a member of the General Division of the Order of Australia. Mr Campbell is also Chairman of the Remuneration Committee, Corporate Governance Committee, and of the Acquisition and Finance Committee and a member of the Audit Committee.

Mr Campbell holds an interest in 157,554 shares and options to acquire a further 15,000 shares in Q Ltd as at the date of this report.


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DIRECTORS’ REPORT

Bruce R Bennie B.Ec Age: 44Director (non-executive) Board member since November 2001, Mr Bennie has held senior sales and

management positions in major corporations, including, a number of large US based telecommunication vendors such as sales Director for Lucent Technologies Australia/NZ. He has strong skills in developing marketing strategies, contract negotiation and strategic selling to major telecommunications companies and brings to Q Ltd over twenty-fi ve years of sales, management and marketing experience in the IT & T sector. Mr Bennie is also a Director of Jumbuck Entertainment Ltd. He is also a member of the Remuneration Committee.

Mr Bennie holds an interest in 10,334 shares and options to acquire a further 6,667 shares in Q Ltd as at the date of this report.

Mark Halstead B.Sc MAICD Age: 42Director (executive) Board member since July 2005, Mr Halstead is the Managing Director of 3

Dimension Interactive Pty Ltd. Mr Halstead brings to the Board extensive experience in advertising sales in the internet and television industries in Australia, Asia and the United Kingdom. He was the founder of 3di and continues to represent 3di at Australian Direct Marketing Association, Internet Advertising Bureau and Australian Interactive Media Industry. Mr Halstead is a member of the Acquisition and Finance Committee.

Mr Halstead holds an interest in 179,579 shares and options to acquire a further 6,667shares in Q Ltd as at the date of this report.

Andrew HS Koo AM, B.Ec, FCPA Age: 66Director (executive) Board member since July 2004, Mr Koo was appointed General Manager – QDi

Direct Press in February 2002 and CEO in 2004. He retired as CEO in July 2007. He has extensive business experience in both the private and public sectors. Mr Koo is a past Executive Chairman of Tasmania Development and Resources, past Chairman of the Tasmanian State Training Authority, past Chairman of Derwent Entertainment Centre, and a past member of the Commonwealth Paper, Pulp, Printing and Publishing Industry Council. He has been chairman of a number of business associations as well as advisory boards to all levels of Government in Australia. Presently, Mr Koo is a member of the Board of the Western Australia Academy of Performing Arts (WAAPA) and is a Director of a number of private companies. He is a Member of the General Division of the Order of Australia. Mr Koo is the chairman of the Audit Committee (appointed 20 September 2008), is a member of the Corporate Governance Committee and the Acquisition and Finance Committee.

Mr Koo holds an interest in 204,000 shares and options to acquire a further 15,000 shares in Q Ltd as at the date of this report.


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DIRECTORS’ REPORT

Paul G Choiselat B.Bus (Accounting), Dip.Bus (Marketing), MBA, CPA, FCIS Age: 54Director (executive) Board member since June 2001, Mr Choiselat was appointed Managing Director

in October 2002 and became full time CEO in June 2008. He has signifi cant experience, primarily in investment, fi nance, manufacture, healthcare, retail sectors, media and technology. He has had extensive experience in funds management, underwriting and venture capital through Beconwood Securities Pty Ltd, his privately owned investment banking business, which has an arrangement to supply certain facilities and services to Q Ltd. Mr Choiselat is also a Non-Executive Director of IPGA Ltd. He was previously the Managing Director of Jumbuck Entertainment Ltd (Oct 2002 to June 2008) and Managing Director of the New Zealand listed TRS Investments Ltd. He has also been a Non-Executive Director of Healthscope Ltd (Jan 2000 to Jan 2006), Destra Corporation Ltd (March 2006 to April 2008) and Quickfl ix Ltd (Dec 2006 to Nov 2007). Mr Choiselat is responsible for the general management of Q Ltd. He is also a member of the Audit, Corporate Governance, Remuneration and Acquisition and Finance Committees.

Mr Choiselat holds an interest in 6,333,418 shares and options to acquire a further 15,000 shares in Q Ltd as at the date of this report.

Secretary of the CompanyThe joint Company Secretaries of the Group in offi ce at the date of this report are Ms May Chuah.and Ms Cynthia Chan. Their qualifi cations and experience are per below:

Ms May A Chuah B.Comm., CACompany Secretary and Chief Financial Offi cer Has been CFO of Q Ltd since October 2002 and was appointed Company

Secretary November 2006. Ms Chuah holds a Bachelor of Commerce degree and is a member of the Institute of Chartered Accountants in Australia. Ms Chuah has extensive experience in the corporate/fi nance area extending to areas of Initial Public Offerings and Mergers and Acquisitions. Responsibilities include all external reporting and regulatory compliance, corporate governance, internal reporting, day to day operational matters, systems, policies, adhoc projects and other fi nancial services including activities related to acquisitions and capital raisings. Ms Chuah is also CFO of IPGA Ltd and of Beconwood Securities Pty Ltd.

Ms Chuah holds an interest in 20,800 shares in Q Ltd as at the date of this report.

Ms Cynthia Chan B. Comm, FINSIA (SA), CSA (Aff)Company Secretary Company Secretary since February 2009. Responsible for the provision of

company secretarial support to the Board including corporate governance, continuous disclosure and compliance systems and practices and investor communications. Ms Chan holds a Bachelor of Commerce degree and a Diploma in Financial Planning. She is a Senior Associate of the Financial Services Institute of Australasia (FINSIA). She has extensive experience in the corporate/fi nance and legal areas with particular emphasis in stock broking, company secretarial services and investments. Ms Chan is also Company Secretary of IPGA Ltd and of the New Zealand listed TRS Investments Ltd.

Ms Chan holds an interest in 100,000 shares in Q Ltd as at the date of this report.


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DIRECTORS’ REPORT

Directors’ and Offi cers’ IndemnityThe Company has indemnifi ed each Director of the Group, the Company Secretary and previous Directors and secretaries (Offi cers) against all liabilities or loss (other than to the Company or a related body corporate) that may arise from their position as Offi cers of the Company and its controlled entities, except where the liability arises out of conduct involving a lack of good faith or indemnifi cation is otherwise not permitted under the Corporations Act. The indemnity stipulates that the Company will meet the full amount of any such liabilities, including costs and expenses, and covers a period of seven years after ceasing to be an Offi cer of the Company.

The Company has also indemnifi ed the current and previous Directors of its controlled entities and certain members of the Company’s senior management for all liabilities and loss (other than to the Company or a related body corporate) that may arise from their position, except where the liability arises out of conduct involving a lack of good faith or indemnifi cation is otherwise not permitted under the Corporations Act.

The Company has executed deeds of indemnity in terms of Article 27 in favour of each Non-Executive Director of the Company and certain Non-Executive Directors of related bodies corporate of the Company.

Directors’ and Offi cers’ InsuranceThe Company has paid insurance premiums for one year cover in respect of Directors’ and Offi cers’ liability insurance contracts, for Offi cers of the Company and of its controlled entities. The insurance cover is on standard industry terms and provides cover for loss and liability for wrongful acts in relation to the relevant person’s role as an Offi cer, except that cover is not provided for loss in relation to Offi cers gaining any profi t or advantage to which they were not legally entitled, or Offi cers committing any criminal, dishonest, fraudulent or malicious act or omission, or any knowing or wilful violation of any statute or regulation. Cover is also only provided for fi nes and penalties in limited circumstances and up to a small fi nancial limit.

The insurance does not provide cover for the independent auditors of the Company or of a related body corporate of the Company. In accordance with usual commercial practice, the insurance contract prohibits disclosure of details of the nature of the liabilities covered by the insurance, the limit of indemnity and the amount of the premium paid under the contract.

Principal activities The principal activity of the Group during the year was the provision of digital marketing services.

Review of OperationsA detailed review of operations and the results of those operations is set out in the Chairman’s Message and MD/CEO Report of this Annual Report.

Except for the matters disclosed at the date of this report, there are no other matters or circumstances which have arisen since 30 June 2009 that have signifi cantly affected or may signifi cantly affect:

(a) the operations in future fi nancial periods subsequent to the fi nancial year ended 30 June 2009, of the Group constituted by the Company and the entities it controls from time to time;

(b) the results of those operations in future fi nancial periods; or(c) the state of affairs, in future fi nancial periods, of the Group.

DividendsNo dividends have been paid or declared since the start of FY 2009 and Q Ltd does not propose to pay a dividend for this reporting period.


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DIRECTORS’ REPORT

Share Issues

During the course of FY2009, the Company issued the following shares:

Month No. of shares Amount received $

Issue type

July 2008 725,808 NIL

Part consideration for acquisition of Freestyle Media Group Pty Ltd (pre 100:1 capital consolidation in November 2008)

December 2008 200,000 NILPart consideration for acquisition of Clear Blue Day Pty Ltd

December 2008 38,913 NILPart consideration for acquisition of First Rate Limited

December 2008 1,360,983 NIL

Part consideration for acquisition of Great Australian Survey Pty Ltd

December 2008 61,283 NILPart consideration for acquisition of Market United Pty Ltd

Events subsequent to reporting dateThere has not arisen in the interval between the end of the reporting period and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors of the Company, to affect signifi cantly the operations of the Company, the results of those operations, or the state of affairs of the Company in future fi nancial years other than a 7 for 5 non-renounceable rights issue which opened on 8 July 2009 and closed on 7 August 2009.

Future DevelopmentsOther than comments on likely developments or expected results of the Group which are included in the Chairman’s Message and the MD/CEO’s Report, in the opinion of the Directors, further information on likely developments in the operations of the Group and the expected results of those operations in future fi nancial periods have been omitted as the Directors believe it would be likely to result in unreasonable prejudice to the Group’s interests if such further information were included in this report.

Business Strategies and ProspectsComments on the Group’s business strategies and its prospects for future fi nancial years are included in the Chairman’s Message and the MD/CEO’s Report. In the opinion of the Directors, further information on the Group’s business strategies and its prospects for future fi nancial years would, if included in this report, be likely to result in unreasonable prejudice to the Group’s interest.

Environmental IssuesThe Company takes a responsible approach in relation to the management of environmental matters. The economic entity’s operations are not subject to signifi cant environmental regulation under the laws of the Commonwealth and State.


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DIRECTORS’ REPORT

Meetings of DirectorsThe table below shows the number of Directors’ meetings held (including meetings of Board committees) and number of meetings attended by each of the Directors of the Company during the year:

DIRECTORS‘MEETINGS

COMMITTEE MEETINGS

AUDIT COMMITTEE

REMUNERATION COMMITTEE

CORPORATE GOVERNANCE COMMITTEE

ACQUISITION AND FINANCE COMMITTEE

Number eligible to

attendNumber Attended

Number eligible to

attendNumber attended

Number Eligible to

AttendNumber Attended

Number Eligible to


Number Eligible to


Mr K V Campbell 15 15 2 2 1 1 N/A* N/A* 1 1

Mr B R Bennie 15 15 - - 1 1 - - - -

Mr P G Choiselat 15 14 2 2 1 1 N/A* N/A* 1 1

Hon J G Kennett 3 3 1 1 - - N/A* N/A* - -

Mr A H S Koo 15 15 1 1 - - - - 1 1

Mr M Halstead 15 15 - - - - N/A* N/A* 1 1

* The Committee did not meet during the year but matters were discussed by the full Board at a number of meetings during FY2009.

Directors’ and executives’ interestsThe table below shows the interests of each Director (as notifi ed to the ASX in accordance with section 205G(1) of the Corporations Act) and executive in the issued ordinary shares of the Group as at the date of this report.

Fully Paid Ordinary Shares Options

Mr K V Campbell 157,554 15,000

Mr B R Bennie 10,334 6,667

Mr P G Choiselat 6,333,418 15,000

Mr A H S Koo 204,000 15,000

Mr M Halstead 179,579 6,667

Ms MA Chuah 20,800 -

Ms C Chan 100,000 -

OptionsThere were no options granted over unissued shares by the Company during or since FY2009. The total balance of options over unissued shares held by employees and Directors at year end is 268,500.

Directors’ Interests in ContractsNo material contracts involving Directors’ interests were entered into since the end of the previous fi nancial year, or existed at the end of the year, other than those transactions detailed in Note 29 to the Financial Statements.

Proceedings on behalf of the CompanyNo person has applied for leave of court to bring proceedings on behalf of the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings.

The Company was not a party to any such proceedings during the year.


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DIRECTORS’ REPORT

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

all material non-audit services are reviewed and approved by the Audit 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 • as set out in the Institute of Chartered Accountants in Australia and CPA Australia’s Professional Statement F1: Professional Independence.

Audit ServicesThe statement by the external auditors to the members of Q Ltd in relation to the auditors’ compliance with the independence requirements of the Corporations Act and the professional code of conduct for external auditors, forms part of this Directors’ Report and is set out after this Directors’ Report.

Rounding of AmountsQ Ltd is the kind of Company referred to in Class Order 98/100, issued by the Australian Securities & Investments Commission, relating to the ‘rounding of’ amounts in the Directors’ Report. Amounts in this Directors’ Report have been rounded in accordance with that Class Order to the nearest dollar.


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DIRECTORS’ REPORT

Remuneration Report

This Remuneration Report forms part of the Directors’ Report and outlines the remuneration arrangements for Directors and other Key Management Personnel of Q Ltd for the fi nancial year ended 30 June 2009.

Director and other Key Management Personnel details

The following persons acted as Directors of the Company during the fi nancial year or since the end of the fi nancial year.

Kevin V Campbell Director – Non Executive (Chairman)Paul G Choiselat Director – MD/CEO Hon Jeffrey G Kennett Director – Non Executive (resigned 20 October 2008)Bruce R Bennie Director – Non ExecutiveAndrew HS Koo Director – Non ExecutiveMark Halstead Director – Managing Director of 3 Dimension Interactive Pty Ltd

The term ‘other Key Management Personnel’ is used in this remuneration report to refer to the following persons. Except as noted, the named persons held their current position for the whole of the fi nancial year and since the end of the fi nancial year:

May A Chuah Company Secretary/CFO Cynthia Chan Company Secretary (appointed 20 February 2009)

Remuneration Committee RoleThe membership, responsibilities, authority and activities of the Remuneration Committee are set out in the Remuneration Committee Charter, which has been approved by the Board.

The responsibilities of the Remuneration Committee are to:monitor, review and recommend to the Board, as necessary and appropriate:•

the remuneration, superannuation and incentive policies and arrangements for the MD/CEO and for Key o Management Personnel;the remuneration arrangements for Non-Executive Directors on the Board;o the recruitment, retention and termination policies and procedures for Key Management Personnel; ando key appointments and executive succession planning.o

oversee the Group’s general remuneration strategy; and• monitor the Group’s culture and reputation and review behavioural standards on a regular basis, and report and • submit recommendations to the Board.

Membership and meetingsThe following outlines the member composition of the Remuneration Committee during the year:

Mr Kevin V Campbell (Chairman)Mr Bruce R BennieMr Paul G Choiselat (MD/CEO)

The Remuneration Committee met once during the year. The number of meetings attended by each member during the year is set out above in the report of the Directors.

Other Group executives may attend the Remuneration Committee meetings by invitation and assist the Remuneration Committee in its deliberations, except on matters associated with their own remuneration.


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DIRECTORS’ REPORT

AdvisersExternal specialist remuneration advice is sought on an as-needs basis in respect of remuneration arrangements for Non-Executive Directors of the Board and Key Management Personnel of the Group. General reward advice is sought on an ad hoc basis.

Reward policyThe Company has an established policy for determining the nature and amount of emoluments of Board Members and Key Management Personnel of the Company to align remuneration with the creation of shareholder value. The remuneration structure for the Key Management Personnel, including the MD/CEO, seeks to emphasise payment for results.

Reward philosophyThe Company’s overall philosophy is to manage the remuneration to:

create an environment that will attract top talent, and where people can be motivated with energy and passion to deliver superior performance;recognise capabilities and promote opportunities for career and professional development; provide rewards, benefi ts and conditions that are competitive within the markets in which the Group operates; andprovide fair and consistent rewards across the Group, which support corporate principles.

In accordance with the ASXBPR, the structure of Non-Executive Directors and Key Management Personnel remuneration is separate and distinct.


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DIRECTORS’ REPORT

Company PerformanceThe table below summarises the fi nancial performance of the Group for the last 5 years, as well as the share price at the end of the respective fi nancial years.

2005 2006 2007 2008 2009

$ $ $ $ $

Revenue 5,281,580 8,324,219 13,423,418 26,565,673 27,294,390

Net Profi t/(Loss) after tax (384,446) (515,121) 1,344,570 (774,577) 384,904

Cents Cents Cents Cents Cents

Share Price at start of Year 0.055 0.026 0.024 0.090 0.017

Share Price at end of Year 0.026 0.024 0.09 0.017 0.11*

Basic earnings per share (1.0) (0.4) 0.3 (0.1) 4.1

Diluted earnings per share (1.0) (0.3) 0.3 (0.1) 4.1

Dividends Paid NIL NIL NIL NIL NIL

* The Company consolidated its capital on a ratio of 100:1 in November 2008.

Key Management Personnel RemunerationThe Company aims to reward Key Management Personnel with a level of remuneration commensurate with their position and responsibilities within the Company and is moving so as to:

Reward Key Management Personnel for achievement of pre-determined key performance indicators;• Link reward with the strategic goals and performance of the Company; and • Ensure total remuneration is competitive by market standards.•

The Company is moving towards annual reviews using a formal appraisal process for the remuneration of Key Management Personnel and other employees.

The Remuneration Committee recommends to the Board increases in fi xed remuneration each year based on the performance of individuals. In addition, the Committee reviews the performance and the remuneration of the MD/CEO and recommends to the Board any short-term incentive payments and adjustments to his remuneration.

The remuneration structure is in two parts:

Fixed remuneration; and • Variable remuneration.•


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DIRECTORS’ REPORT

Fixed remuneration

Fixed remuneration comprises salary, superannuation and other benefi ts. Some individuals, however, have chosen to sacrifi ce part of their salary to increase contributions to their superannuation fund at no additional cost to the Company.

Variable RemunerationComprises a short term incentive plan and a long term incentive plan.

Short term incentive plan•

Short term incentives are used to differentiate rewards based on performance on a year by year basis. The principal performance indicator of the short term incentive plan is based on the Company’s fi nancial performance and individual achievement of specifi ed goals, for example for achieving progress with growth initiatives.

Long term incentive plan•

Q Ltd operates an employee option plan called the Q Ltd Incentive Option Scheme (“Scheme”). The Scheme is designed to provide a long term incentive for employees and Directors of Q Ltd by aligning their interests more closely with those of Q Ltd shareholders. It will allow employees to participate in Q Ltd’s future growth and give them an incentive to increase profi tability and returns to shareholders. Full time employees, part-time employees, Directors and contractors of Q Ltd are eligible to participate in the Scheme.

At a meeting of the Remuneration Committee held on 7th February 2002, the Committee acknowledged that an issue of options to any Director of the Company (and/or their associates) would need the approval of shareholders and agreed that such issues should ideally be made outside of the Scheme. The entitlement of eligible participants under the Scheme is at the absolute discretion of the Directors. The exercise price of each option offered pursuant to the Scheme is at the discretion of the Directors.

The total number of options which may be issued under the Scheme may not exceed 5% of the total number of issued shares in Q Ltd as at the time of the proposed offer or issue. The options hold no voting or dividend rights, and are not transferable.

During and since the end of the fi nancial year, no options were issued to employees under the Scheme. The Company consolidated its capital on a 100:1 ratio in November 2008. 26,250 (post consolidation) options were forfeited during the fi nancial year. There are 268,500 options on issue at 30 June 2009.


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DIRECTORS’ REPORT

During the last 5 years, the Company has been transforming itself from having printing and mobile content businesses to now having an interactive advertising and digital marketing services business. This included the disposal of all of the Company’s previous business activities and replacing them with a new business comprising a number of complimentary businesses involved in different segments of the digital advertising and marketing sector. The performance of the Company during that time has been volatile and diffi cult to predict. Accordingly it has been diffi cult for the Company’s remuneration policy to be closely linked to its performance during the last few years. The Company’s remuneration policy will be more closely linked to the Company’s performance once the integration of the businesses is completed satisfactorily.

The main vesting conditions for options granted to Key Management Personnel are as follows:

Options may be exercised at any time between vesting and expiry date• Options not exercised on or before expiry date will lapse• Options will vest with the option holder on vesting date. In the event of a takeover bid for more than•

50% of the Company’s shares, this vesting condition will be waived, provided that the option holder isan employee of the Company at vesting date subject to the following:

If an employee is transferred into an entity not forming part of the Company as a result of some(i) form of merger or acquisition, this vesting condition will be waived In the event of a takeover bid for more than 50% of the Company’s shares, this vesting (ii) condition will be waived

(iii) In the event the employee has been with the Company (or its related body corporate) for in excess of 5 years service prior to leaving, the Board will have the discretion to waive the vesting

condition.

The options are not linked to the performance of the Group because the Group has been in transition phase. Part of this has resulted in the Group pursuing top line growth with a lesser focus on maximising profi t growth. Setting vesting conditions on options that are linked to profi t growth during this period would have resulted in a possible disconnect between the objectives of the Group and that of the employees. In the circumstances we believe that the vesting conditions are fair and appropriate.

The Company has no policy in respect of employees hedging options issued to them.


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DIRECTORS’ REPORT

Key Management Personnel RemunerationThe following table summarises the remuneration arrangements for executive Directors and other Key Management Personnel.

Mr PG Choiselat Mr M Halstead MS MA Chuah MS C Chan

Position CEO Managing Director of 3 Dimension interactive Pty Ltd

Company Secretary/CFO

Company Secretary

Term of employment agreement

July 2008 to June 2011

No contract in place No contract in place No contract in place

Notice period 12 months No contract in place No contract in place No contract in place

Total employment cost (TEC)*

$366,017 $212,866 $251,840 $44,802

Short term incentive

Bonus based on a percentage of a fi xed allocated bonus pool subject to achievement of target EBITDA.

Bonus based on a percentage of fi xed allocated bonus pool subject to achievement of targeted EBITDA.

No variable remuneration was paid during the year.

No variable remuneration was paid during the year.

Long term incentive

Bonus based on a percentage of targeted EBITDA.15,000 options on issue at 30 June 2009.

6,667 options on issue at 30 June 2009

N/A N/A

Other benefi ts Executive Directors are eligible to participate in other benefi ts that are normally provided to executives employed by the Company, subject to any overriding legislation prevailing at the time including the Corporations Act 2001 (Cth)

Executive Directors are eligible to participate in other benefi ts that are normally provided to executives employed by the Company, subject to any overriding legislation prevailing at the time including the Corporations Act 2001 (Cth)

N/A N/A

Termination by executive

12 months No contract in place No contract in place No contract in place

Termination by Company

12 months No contract in place No contract in place No contract in place

* A portion of TEC may be taken in the form of packaged benefi ts (such as a motor vehicle and parking), and is inclusive of fringe benefi ts tax and employer superannuation contributions.


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DIRECTORS’ REPORT

The Board is moving towards agreeing or determining each year, reasonable performance measures and targets for use in assessing each Executive Director’s performance. After the end of each fi nancial year, the Board plans to review each Executive Director’s performance by reference to these measures and targets. STI targets (as a percentage of TEC) are to be determined annually by the Board for the coming year. TEC is base remuneration inclusive of superannuation and benefi ts but excludes leave accrued not taken.

Details of remunerationThe following table shows details of the nature and amount of each element of the remuneration paid or payable with respect to services provided for the period as Directors of the Company and other Key Management Personnel of the Group during FY2009. All Directors and other Key Management Personnel are paid in Australian dollars.

No retirement benefi ts were paid or payable to Directors or other Key Management Personnel in FY2009.

The following Directors and executives include all Key Management Personnel.

TABLE A

Short term employee benefi ts

Post employment

benefi ts

Other Long Term

Employee Benefi ts

Share based

paymentTotal

2009

Salary & Fees

Bonus OtherSuper-

annuation

Options & Rights

%

Remuneration Consisting of

Options$ $ $ $ $ $ $

Non-executive Directors

B R Bennie

45,000 - - 4,050 - 1,678 50,728 3.3

K V Campbell

75,000 - - 6,750 - 2,517 84,267 3.0

Hon. J G Kennett

13,669 - - 1,230 - (2,103) 12,796 (16.0)

A H S Koo

45,000 - - 4,050 - 2,517 51,567 4.9

Executive directors

P G Choiselat

292,500 - - - 71,000 2,517 366,017 0.7

M Halstead

193,750 - - 17,438 - 1,678 212,866 0.8

Sub total

664,919 - - 33,518 71,000 8,804 778,241 1.1

Executive Offi cers

M A Chuah

251,840 - - - - - 251,840 -

C Chan

44,802 - - - - - 44,802 -

Sub Total

296,642 - - - - - 296,642 -

Total

961,561 - - 33,518 71,000 8,804 1,074,883 0.8


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DIRECTORS’ REPORT

TABLE B

Short term employee benefi ts

Post employment

benefi ts

Other Long Term Employee Benefi ts

Share based

payment

2008

Salary & Fees

Bonus Other Super-

annuation

Options & Rights

Total%

Remuneration Consisting of

Options $ $ $ $ $ $ $

Non-executive directors

B R Bennie

45,000 - - 4,050 - 3,448 52,498 6.6

K V Campbell

75,000 - - 6,750 - 5,172 86,922 6.0

Hon. J G Kennett

45,000 - - 4,050 - 3,448 52,498 6.6

A H S Koo

45,000 - - 4,050 - 5,172 54,222 9.5

Executive directors

P G Choiselat

52,000 - - 4,680 - 5,172 61,852 8.4

M Halstead

250,000 - - 22,500 - 3,448

275,948 1.2

Sub total

512,000 - - 46,080 - 25,860

583,940 4.4

Executive Offi cers

M A Chuah

309,118 - - - - -

309,118 -

Sub Total

309,118 - - - - -

309,118 -

Total

821,118 - - 46,080 - 25,860

893,058 2.9

In addition to remuneration benefi ts above, the Company paid a premium for a contract insuring all Directors of the Company and specifi ed executives of the Group as offi cers. It is not possible to allocate the benefi t of this premium between individual Directors or specifi ed executives. In accordance with usual commercial practice, the insurance contract prohibits disclosure of details of the premium paid under the contract.

Non-Executive Director remunerationThe following persons were Non-Executive Directors of the Company at 30 June 2009:

Name Position Kevin V Campbell ChairmanBruce R Bennie Non-Executive Director

Andrew H S Koo Non-Executive Director


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DIRECTORS’ REPORT

Remuneration policyThe fees paid to Non-Executive Directors on the Board are based on advice and data from the Group’s remuneration specialists and from external remuneration advisers. This advice takes into consideration the level of fees paid to Board members of other major Australian corporations, the size and complexity of the Group’s operations, the activities of the Group and the responsibilities and workload requirements of Board members.

Fees are established annually for the Chairman and Non-Executive Directors.

The total fees paid by the Group to the non executive members of the Board, including fees paid for their involvement on Board committees, are kept within the maximum approved by shareholders from time to time. The current shareholder approved maximum fee pool approved by the shareholders is $250,000 per annum.

All Directors have fl exibility in relation to their remuneration, including the opportunity to set aside additional Company superannuation contributions.

The appointment letters for the Non-Executive Directors set out the terms and conditions of their appointments. These terms and conditions are in conjunction with, and subject to, the Company’s Constitution and the charters and policies approved by the Board from time to time.

Each Non-Executive Director receives a fee for being a Director of the Company but no additional fees for sitting on or chairing committees. The Non-Executive Directors also receive superannuation contributions, currently at 9%, and do not receive any other retirement benefi ts.

OptionsThere were no new options granted to Directors in FY2009.

Details of total options on issue by Q Ltd as at 30 June 2009 in respect of Directors and other Key Management Personnel is as per below.

Issuing entity

Option seriesNumber

of shares under option

Class of shares

Fair value of option (dollars)

at date of issue

Exercise price of option

Vesting date

Expiry date of option Grant Date (dollars)

Q Ltd Issued 30/11/2006 18,333 Ordinary 0.8 2.68 30/09/2007 30/09/2010



Total 65,000

Conditions of the options:Each option will convert into 1 ordinary share. The vesting of the options will occur in three tranches according to the vesting dates in the above table. Options may be exercised before the expiry date on or after the vesting date for each series. The option holder must be employed by the Company to satisfy the vesting conditions for the options issued under the Q Ltd Incentive Option Scheme.


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DIRECTORS’ REPORT

The following share-based payment compensation to Directors and other Key Management Personnel relate to the current fi nancial year:

Grant date

Value of options granted at grant date $

No. Granted post 100:1

consolidationNo

Vested% Grant vested

No. options forfeited

No. exercised

to date

Amount paid to

dateAmount unpaid

B R Bennie 30/11/2006 9,600 6,667 6,667 66.7 - 3,333

8,933 -

K V Campbell 30/11/2006 14,400 15,000 10,000 66.7 - - - -

P G Choiselat 30/11/2006 14,400 15,000 10,000 66.7 - - - -

M Halstead 30/11/2006 9,600 6,667 6,667 66.7 - 3,333 8,933 -

Hon J G Kennett 30/11/2006 9,600 6,666 6,666 66.7 3,334 - - -

AHS Koo 30/11/2006 14,400 15,000 10,000 66.7 - - - -

Total 72,000 65,000 50,000 3,334 6,666

17,866 -

Valuation method of optionsThe Company has in respect of the equity based Options component of Directors’ and Offi cers’ emoluments, valued those Options using the Black-Scholes Option Pricing Model, which takes account of factors including the options exercise price, the current level and volatility of the underlying share price, the risk free interest rate, expected dividends on the underlying share, current market price on the underlying share and expected life of the option.

This report is made in accordance with a resolution of the Directors and is signed for and on behalf of the Directors.

Dated at Melbourne this 14th day of September 2009.

Paul G ChoiselatMD/CEO


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AUDITORS INDEPENDENCE DECLARATION


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INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2009

Notes Consolidated Company

2009$

2008$

2009$

2008$

Continuing operations

Revenue 2 27,117,293 26,099,169 - 2,357

Cost of sales (8,572,156) (8,244,910) - -

Gross profi t 18,545,137 17,854,259 - 2,357

Other revenue 2 177,097 223,489 500,922 136,719

Administration and other related costs (1,247,997) (1,361,834) (551,973) (597,285)

Business Development - 56,200 - 89,720

Consultants (233,578) (227,548) (50,160) (54,506)

Depreciation and amortisation 3 (787,907) (642,650) (111,247) (79,055)

Employee benefi ts (12,415,449) (11,933,367) (1,310,257) (834,511)

Equipment rental (18,591) (13,938) - -

Finance costs 3 (35,648) (43,917) (24,868) (10,481)

Freight (11,999) (8,097) (1,215) (1,111)

Insurance (159,052) (79,068) (49,650) (21,778)

Marketing (529,992) (622,846) (21,866) (9,091)

Occupancy (1,050,747) (1,110,482) (122,620) (68,245)

Other expenses (957,693) (861,790) (40,688) (41,516)

Repairs and maintenance (19,130) (22,798) (13,424) (4,012)

Subcontractors (20,614) (198,635) - -

Technology service (94,541) (81,240) - -

Travel and accommodation (365,232) (395,474) (97,565) (44,937)

Profi t / (Loss) before income tax expense 774,064 530,263 (1,894,611) (1,537,731)

Income tax benefi t (expense) 5 (389,160) 76,245 681,906 684,103

Profi t/(Loss) for the year from continuing operations 384,904 606,508 (1,212,705) (853,628)

Discontinued operations

Loss before income tax expense - (1,616,337) - (747,303)

Income tax benefi t 5 - 235,252 - -

Loss for the year from discontinued operations - (1,381,085) - (747,303)

Profi t/(Loss) for the year 384,904 (774,577) (1,212,705) (1,600,931)

From continuing and discontinued operations

Basic earnings per share (cents per share) 8 4.1 (10.0)

Diluted earnings per share (cents per share) 8 4.1 (10.0)

From continuing operations

Basic earnings per share (cents per share) 8 4.1 8.0

Diluted earnings per share (cents per share) 8 4.1 8.0


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BALANCE SHEET AS AT 30 JUNE 2009


2009$

2008$

2009$

2008$

CURRENT ASSETS

Cash and cash equivalents 9 2,429,496 4,837,241 135,145 2,200,753

Trade and other receivables 10 5,020,518 5,429,737 2,706,241 1,956,106

Other 11 52,101 82,328 2,883 64,818

TOTAL CURRENT ASSETS 7,502,115 10,349,306 2,844,269 4,221,677

NON-CURRENT ASSETS

Other fi nancial assets 12 18,677 18,677 31,588,093 23,619,234

Property, plant and equipment 13 873,280 923,733 173,775 103,607

Intangibles 14 29,088,814 21,083,727 74,440 153,428

Deferred tax assets 16 2,882,327 2,960,294 3,932,004 3,250,098

TOTAL NON-CURRENT ASSETS 32,863,098 24,986,431 35,768,312 27,126,367

TOTAL ASSETS 40,365,213 35,335,737 38,612,581 31,348,044

CURRENT LIABILITIES

Trade and other payables 15 11,150,192 9,015,892 6,766,892 4,451,317

Borrowings 17 270,000 42,073 250,000 -

Provisions 18 385,581 403,828 20,586 7,350

TOTAL CURRENT LIABILITIES 11,805,773 9,461,793 7,037,478 4,458,667

NON-CURRENT LIABILITIES

Borrowings 17 9,638 7,908 - -

Trade and other payables 15 - - 5,868,921 2,301,623

Provisions 18 82,471 35,540 17,986 -

TOTAL NON-CURRENT LIABILITIES 92,109 43,448 5,886,907 2,301,623

TOTAL LIABILITIES 11,897,882 9,505,241 12,924,385 6,760,290

NET ASSETS 28,467,331 25,830,496 25,688,196 24,587,754

EQUITY

Issued Capital 19 41,392,828 39,170,024 41,392,828 39,170,024

Reserves 20 104,112 74,985 226,029 135,686

Accumulated losses (13,029,609) (13,414,513) (15,930,661) (14,717,956)

TOTAL EQUITY 28,467,331 25,830,496 25,688,196 24,587,754

The accompanying notes form part of these fi nancial statements.


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STATEMENT OF CHANGES IN EQUITY FOR YEAR ENDED 30 JUNE 2009

Note

Fully paid ordinary shares

$

Retained earnings/ (losses)

$Reserves

$Total

$

Consolidated

Balance at 1 July 2007 23,197,935 (12,639,936) 70,536 10,628,535

282,595,817 shares issued during the year 16,828,957 - - 16,828,957

Transaction costs relating to share issue (856,868) - - (856,868)

Loss attributable to members of the Company - (774,577) - (774,577)

Increase/(Decrease) in reserves 20 - - 4,449 4,449

Balance at 30 June 2008 39,170,024 (13,414,513) 74,985 25,830,496



Profi t attributable to members of the Company - 384,904 - 384,904


Subtotal 2,222,804 384,904 29,127 2,636,835

Balance at 30 June 2009 41,392,828 (13,029,609) 104,112 28,467,331

Company

Balance at 1 July 2007 23,197,935 (13,117,025) 64,413 10,145,323



Loss attributable to members of the Company - (1,600,931) - (1,600,931)


Balance at 30 June 2008 39,170,024 (14,717,956) 135,686 24,587,754



Profi t attributable to members of the Company - (1,212,705) - (1,212,705)


Subtotal 2,222,804 (1,212,705) 90,343 1,100,442

Balance at 30 June 2009 41,392,828 (15,930,661) 226,029 25,688,196



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CASH FLOW STATEMENT FOR THE YEAR ENDED 30 JUNE 2009


2009$

2008$

2009$

2008$

CASH FLOWS FROM OPERATING ACTIVITIES

Receipts from customers 29,235,410 27,872,794 - 364,353

Payments to suppliers and employees (27,453,178) (29,549,696) (1,817,865) (2,227,662)

Interest received 130,546 223,489 56,058 136,719

Interest and other costs of fi nance paid (39,674) (43,917) (24,878) (10,481)

Net cash provided by/(used in) operating activities 22a 1,873,104 (1,497,330) (1,786,685) (1,737,071)

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property, plant and equipment (677,105) (757,501) (84,707) (150,952)

Payments for subsidiaries net of cash acquired (3,676,429) (8,220,250) (3,676,429) (8,220,250)

Receipt for sale of fi xed asset 20,891 - - -

Net cash (used in) investing activities (4,332,643) (8,977,751) (3,761,136) (8,371,202)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from issue of shares - 12,512,666 - 12,512,666

Share issue costs (89,863) (905,187) (92,577) (905,187)

Proceeds from borrowings 250,000 - 250,000 -

Repayment of borrowings (108,343) (26,644) - (26,644)

Loan (to)/from controlled entities - - 3,324,790 (1,612,240)

Net cash provided by fi nancing activities 51,794 11,580,835 3,482,213 9,968,595

Net increase/(decrease) in cash held (2,657,744) 1,105,754 (2,065,608) (139,678)

Cash and cash equivalents at beginning of fi nancial year 4,837,241 3,731,487 2,200,753 2,340,431

Cash and cash equivalents at end of fi nancial year 9 2,429,496 4,837,241 135,145 2,200,753



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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2009

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

The fi nancial report is a general purpose fi nancial report which has been prepared in accordance with the Corporations Act 2001, Accounting Standards and Interpretations, and complies with other requirements of the law.

The fi nancial report includes the separate fi nancial statements of the Company and the consolidated fi nancial statements of the Group. Q Ltd is a listed public Company, incorporated and domiciled in Australia.

Accounting Standards include Australian equivalents to International Financial Reporting Standards (“A-IFRS”). Compliance with A-IFRS ensures that the fi nancial statements and notes of the Group and Company comply with International Financial Reporting Standards (“IFRS”).

The fi nancial statements were authorized for issue by the Directors on 14 September 2009.

Basis of Preparation

The fi nancial report has been prepared on the basis of historical cost, unless otherwise stated. Cost is based on the fair values of the consideration given in exchange for assets. All amounts are presented in Australian dollars, unless otherwise noted.

Unless otherwise indicated, the following signifi cant accounting policies have been adopted in the preparation and presentation of the fi nancial report.

The accounting policies set out below have been consistently applied to all years presented.

Going concern

The fi nancial report has been prepared on the going concern basis, which assumes continuity of normal business activities and the realisation of assets and the settlement of liabilities in the ordinary course of business.

As at 30 June 2009 the Consolidated Entity and the Company has an excess of current liabilities over current assets of $4,303,658 and $4,193,209. The defi ciency is primarily caused by the requirement to recognise the quantum of various vendor earn out payments of an estimated $1.1 million in shares and $4.8 million in cash, that will be paid by fi rst half of FY 2010, as a current liability within the balance sheet.

Notwithstanding this defi ciency, the fi nancial report has been prepared on a going concern basis on the basis of the following assumptions:-

The Group continuing to generate suffi cient operating cash fl ows to enable its trading debts to be paid as and (i) when they are payable;

The ability of the Group to successfully raise additional debt facilities; and(ii)

The Company successfully raising additional equity funding.(iii)

At the date of this report and having considered the above position, the directors are confi dent that the Consolidated Entity and the Company will be able to continue as going concerns given the following:

The Consolidated Entity generated operating cash fl ows of $1.873 million for the year ended 30 June 2009 (a) and is expected to continue generating positive cash fl ows in the coming year.The Company is in the process of formalising additional debt facilities which will provide at least $500k (b) additional funds to meet present obligations;A successful rights issue of $1 million was made in August 2009. The directors believe that they will be able (c) to raise additional funds in future periods.

Notwithstanding this there is signifi cant uncertainty whether the Company and the Consolidated Entity will continue as going concerns and, therefore, whether they will realise their assets and extinguish their liabilities in the normal course of business and at the amounts stated in the fi nancial report.

The fi nancial report does not include adjustments relating to the recoverability and classifi cation of recorded asset amounts or to the amounts and classifi cation of liabilities that might be necessary should the Company and the Consolidated Entity not continue as going concerns.


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NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Adoption of new and revised Accounting Standards

In the In the current year, the Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (the AASB) that are relevant to its operations and effective for the current annual reporting period. Adoption of the relevant standards had no impact on the fi nancial report.

Standards and Interpretations issued not yet effective

At the date of authorisation of the fi nancial report, the Standards and Interpretations listed below were in issue but not yet effective. Initial application of the following Standard will not affect any of the amounts recognised in the fi nancial report, but will change the disclosures presently made in relation to the Group and the Company’s fi nancial report:

AASB 101 ‘Presentation of Financial • Statements; (revised September 2007), AASB 2007-8 ‘Amendments to Australian Accounting Standards arising from AASB101’

Effective for annual reporting periods beginning on or after 1 January 2009

AASB 8 ‘Operating Segments, AASB 2007-• 3 ‘Amendments to Australian Accounting Standards arising from AASB 8’


Initial application of the following Standards and Interpretations is not expected to have any material impact on the fi nancial report of the Group and the Company:

AASB 123 ‘Borrowing Costs’ (revised)• Programmes’, AASB 2007-6 ‘Amendments to Australian accounting Standards arising from AASB 123’


AASB 3 ‘Business Combinations’ and IAS 27 • ‘AASB 127 Consolidated and Separate Financial Statements’ and AASB 2008-3 Amendments to Australian Accounting Standards arising from AASB 3 and AASB 127.

AASB 3 (business combinations occurring after the beginning of annual reporting periods beginning 1 July), AASB 127 and AASB 2009-3 (1 July 2009)

AASB 2008-1 ‘Amendments to Australian • Accounting Standard – Share –based Payments: Vesting Conditions and Cancellations’


AASB 2008-2 ‘Amendments to Australian • Accounting Standard – Puttable Financial Instruments and Obligations arising on Liquidation’


AASB 2008-5 ‘Amendments to Australian • Accounting Standards arising from the Annual Improvements Project’


AASB 2008-6 ‘Further amendments to • Australian Accounting Standards arising from the Annual Improvements Project’


AASB 2008-6 ‘Further amendments to • Australian Accounting Standards arising from the Annual Improvements Project’



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AASB 2008-7‘Amendments to Australian • Accounting Standards – Cost of an Investment in a Subsidiary, jointly Controlled Entity or Associate’


AASB 2008-8‘ Amendments to Australian • Accounting Standards – Eligible Hedged Items’

Effective for annual reporting periods beginning on or after 1 July 2009

AASB Interpretation 15 ‘Agreements for the • Construction of Real Estate’


AASB Interpretation 16 ‘Hedges of a Net • Investment in a Foreign Operation’


AASB Interpretation 17 ‘Distributions of • Non-cash Assets to Owners’,AASB 2008-13 ‘Amendments to Australian Accounting Standards arising from AASB interpretation 17 – Distributions of Non-cash Assets to Owners’


AASB 2009-4‘ Amendments to Australian • Accounting Standards arising from the Annual Improvements Process


AASB 2009-5‘ Amendments to Australian • Accounting Standards arising from the Annual Improvements Process



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The following signifi cant accounting policies have been adopted in the preparation and presentation of the fi nancial report:

a. Basis of Consolidation

The consolidated fi nancial statements incorporate the fi nancial statements of Q Ltd the Company, and entities controlled by Q Ltd (referred to as “the Group” in these fi nancial statements). Control is achieved where Q Ltd has the power to govern the fi nancial and operating policies of an entity so as to obtain benefi ts from its activities. A list of controlled entities is contained in Note 23 to the fi nancial statements.

The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the fi nancial statements.

All intra-Group transactions, balances, income and expenses are eliminated in full on consolidation. In the separate fi nancial statements of the Group, intra-Group transactions (‘common control transactions’) are generally accounted for by reference to the existing (consolidated) book value of the items. Where the transaction value of common control transactions differ from their consolidated book value, the difference is recognized as a contribution by or distribution to equity participants by the transacting entities.

Borrowingsb. Borrowings are recorded initially at fair value, net of transaction costs. Subsequent to initial recognition, borrowings are measured at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in income over the period of the borrowing using the effective interest rate method. All borrowing cost are recognised in profi t or loss in the period in which they are incurred.

c. Business combinations Acquisitions of subsidiaries and businesses are accounted for using the purchase method. The cost of the

business combination is measured as the aggregate of the fair values (at the date of exchange) of assets given, liabilities incurred or assumed, and any equity instruments issued by the Group in exchange for control of the acquiree, plus any costs directly attributable to the business combination. The acquiree’s identifi able assets, liabilities and contingent liabilities that meet the conditions for recognition under AASB 3 ‘Business Combinations’ are recognised at their fair values at the acquisition date, except for non-current assets (or disposal Groups) that are classifi ed as held for sale in accordance with AASB 5 ‘Non-Current Goodwill’ arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the business combination over the Group’s interest in the net fair value of the identifi able assets, liabilities and contingent liabilities recognised. If, after reassessment, the Group’s interest in the net fair value of the acquiree’s identifi able assets, liabilities and contingent liabilities exceeds the cost of the business combination, the excess is recognised immediately in profi t or loss.

d. Cost of salesCost of sales consists of all expenses incurred by the Group in order to earn revenue from services. This includes relevant 3rd party expenses and internal wages.


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e. Cash and cash equivalentCash comprises cash on hand and on demand deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignifi cant risk of changes in value. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet.

f. Comparative fi guresWhere required by Accounting Standards comparative fi gures have been adjusted to conform with changes in presentation for the current fi nancial year.

g. Employee benefi tsA liability is recognised for benefi ts accruing to employees in respect of wages and salaries, annual leave, long service leave, and sick leave when it is probable that settlement will be required and they are capable of being measured reliably.

Liabilities recognised in respect of employee benefi ts expected to be settled within 12 months, are measured at their nominal values using the remuneration rate expected to apply at the time of settlement.

Liabilities recognised in respect of employee benefi ts which are not expected to be settled within 12 months are measured as the present value of the estimated future cash outfl ows to be made by the Group in respect of services provided by employees up to reporting date.

Defi ned contribution plansContributions to defi ned contribution superannuation plans are expensed when incurred.

The Company operates an ownership-based remuneration scheme through the Q Ltd Incentive Option Scheme, details of which are provided in Note 27 to the fi nancial statements. Other than minimal administration costs, which are expensed when incurred, the plan does not result in any cash outfl ows to the Company. The total amount to be expensed over the vesting period is determined by reference to the fair value of the shares of the options granted.


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h. Financial assetsSubsequent to initial recognition, investments in subsidiaries are measured at cost. Other fi nancial assets are classifi ed into the following specifi ed categories: fi nancial assets ‘at fair value through profi t or loss’, ‘held-to-maturity’ investments, ‘available-for-sale’ fi nancial assets, and ‘loans and receivables’. The classifi cation depends on the nature and purpose of the fi nancial assets and is determined at the time of initial recognition.

At the balance date the following categories of fi nancial assets were held:

Effective interest methodThe effective interest method is a method of calculating the amortised cost of a fi nancial asset and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees on points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the fi nancial asset, or, where appropriate, a shorter period.

Income is recognized on an effective interest rate basis for debt instruments other than those fi nancial assets ‘at fair value through profi t or loss’.

Loans and receivablesTrade receivables, loans, and other receivables that have fi xed or determinable payments that are not quoted in an active market are classifi ed as ‘loans and receivables’. Loans and receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest rate.

Impairment of fi nancial assetsFinancial assets, other than those at fair value through profi t or loss, are assessed for indicators of impairment at each balance sheet date. Financial assets are impaired where there is objective evidence that as a result of one of more events that occurred after the initial recognition of the fi nancial asset the estimated future cash fl ows of the investment have been impacted.

For fi nancial assets carried at amortised cost, the amount of the impairment is the difference between the asset’s carrying amount and the present value of estimated future cash fl ows, discounted at the original effective interest rate.

The carrying amount of fi nancial assets including uncollectible trade receivables is reduced by the impairment loss through the use of an allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profi t or loss.

Derecognition of fi nancial assets The Group derecognises a fi nancial asset only when the contractual rights to the cash fl ows from the asset

expire, or it transfers the fi nancial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognises its retained interest in the asset and associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred fi nancial asset, the Group continues to recognise the fi nancial asset and also recognises a collateralised borrowing for the proceeds received.


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i. Financial instruments issued by the CompanyDebt and equity instrumentsDebt and equity instruments are classifi ed as either liabilities or as equity in accordance with the substance of the contractual arrangement. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Group are recorded at the proceeds received, net of direct issued costs.

Financial liabilities Financial liabilities are classifi ed as either fi nancial liabilities ‘at fair value through profi t or loss’ or other fi nancial liabilities.

Financial liabilities at fair value through profi t or lossFinancial liabilities at fair value through profi t or loss are stated at fair value, with any resultant gain or loss recognised in profi t or loss. The net gain or loss recognised in profi t or loss incorporates any interest paid on the fi nancial liability.

Other fi nancial liabilitiesOther fi nancial liabilities, including borrowings, are initially measured at fair value, net of transaction costsOther fi nancial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis.

The effective interest method is a method of calculating the amortised cost of a fi nancial liability and of allocating interest relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the fi nancial liability, or, where appropriate, a shorter period.

j. Foreign currencyThe individual fi nancial statements of each entity in the Group are presented in the currency of the primary economic environment in which the entity operates (its functional currency). For the purpose of the consolidated fi nancial statements, the results and fi nancial position of each entity are expressed in Australian dollars, which is the functional currency of Q Ltd, and the presentation currency for the consolidated fi nancial statements.

In preparing the fi nancial statements of the individual entities, transactions in currencies other than the entity’s functional currency (foreign currencies) are recorded at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the balance sheet date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

Exchange differences are recognised in profi t or loss in the period in which they arise except for:

exchange differences which relate to assets under construction for future productive use, which are included • in the cost of those assets where they are regarded as an adjustment to interest costs on foreign currency borrowings;exchange differences on transactions entered into in order to hedge certain foreign currency risks; and• exchange differences on monetary items receivable from or payable to a foreign operation for which • settlement is neither planned or likely to occur, which form part of the net investment in a foreign operation, and which are recognised in the foreign currency translation reserve and recognised in profi t or loss on disposal of the net investment.

On consolidation, the assets and liabilities of the Group’s foreign operations (including comparatives) are translated into Australian dollars at exchange rates prevailing on the balance sheet date. Income and expense items (including comparatives) are translated at the average exchange rates for the period, unless exchange rates fl uctuated signifi cantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are classifi ed as equity and transferred to the Group’s translation reserve. Such exchange differences are recognised in profi t or loss in the period in which the foreign operation is disposed.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity on or after the date of transition to A-IFRS are treated as assets and liabilities of the foreign entity and translated at exchange rates prevailing at the reporting date. Goodwill arising on acquisitions before the date of transition to A-IFRS is treated as an Australian dollar denominated asset.


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k. GoodwillGoodwill acquired in a business combination is recognised as an asset and initially measured at cost, being the excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifi able assets, liabilities and contingent liabilities recognised. If, after reassessment, the Group’s interest in the net fair value of the acquiree’s identifi able assets, liabilities and contingent liabilities exceeds the cost of the business combinations, the excess is recognised immediately in profi t or loss.

For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash-generating units (CGUs), or Groups of CGUs, expected to benefi t from the synergies of the business combination. CGUs (or Groups of CGUs) to which goodwill has been allocated are tested for impairment annually, or more frequently if events or changes in circumstances indicate that goodwill might be impaired.

If the recoverable amount of the CGU (or Group of CGUs) is less than the carrying amount of the CGU (or Groups of CGUs), the impairment loss is allocated fi rst to reduce the carrying amount of any goodwill allocated to the CGU (or Groups of CGUs) and then to the other assets of the CGU (or Groups of CGUs) pro-rata on the basis of the carrying amount of each asset in the CGU (or Groups of CGUs). An impairment loss recognised for goodwill is recognised immediately in profi t or loss and is not reversed in a subsequent period.

On disposal of an operation within a CGU, the attributable amount of goodwill is included in the determination of the profi t or loss on disposal of the operation.

l. Goods and services tax Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except:

where the amount of GST incurred is not recoverable form the taxation authority, it is recognised as - part of the cost of acquisition of an asset or as part of an item of expense; orfor receivables and payables which are recognised inclusive of GST.-

The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables.Cash fl ows are included in the cash fl ow statement on a gross basis. The GST component of cash fl ows arising from investing and fi nancing activities which is recoverable from, or payable to, the taxation authority is classifi ed within operating cash fl ows.

m. Impairment of other tangible and intangible assets

At each reporting date, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash fl ows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Where a reasonable and consistent basis of allocation can be identifi ed, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest Group of cash-generating units for which a reasonable and consistent allocation basis can be identifi ed.

Intangible assets with indefi nite useful lives and intangible assets not yet available for use are tested for impairment annually and whenever there is an indication that the asset may be impaired.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash fl ows are discounted to their present value using a pre-tax discount rate that refl ects current market assessments of the time value of money and the risks specifi c to the asset for which the estimates of future cash fl ows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised in profi t or loss immediately, unless the relevant asset is carried at fair value, in which case the impairment loss is treated as a revaluation decrease. Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an impairment loss is recognised in profi t or loss immediately, unless the relevant asset is carried at fair value, in which case the reversal of the impairment loss is treated as a revaluation increase.


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n. Income taxCurrent taxCurrent tax is calculated by reference to the amount of income taxes payable or recoverable in respect of the taxable profi t or tax loss for the period. It is calculated using tax rates and tax laws that have been enacted or substantively enacted by reporting date. Current tax for current and prior periods is recognised as a liability (or asset) to the extent that it is unpaid (or refundable).

Deferred taxDeferred tax is accounted for using the balance sheet liability method. Temporary differences are differences between the tax base of an asset or liability and its carrying amount in the balance sheet. The tax base of an asset or liability is the amount attributed to that asset or liability for tax purposes.

In principle, deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets are recognised to the extent that it is probable that suffi cient taxable amounts will be available against which deductible temporary differences or unused tax losses and tax offsets can be utilised. However, deferred tax assets and liabilities are not recognised if the temporary differences giving rise to them arise from the initial recognition of assets and liabilities (other than as a result of a business combination) which affects neither taxable income nor accounting profi t. Furthermore, a deferred tax liability is not recognised in relation to taxable temporary differences arising from the initial recognition of goodwill.

Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries, branches and associates, and interests in joint ventures except where the Group is able to control the reversal of the temporary differences and it is probable that the temporary differences will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with these investments and interests are only recognised to the extent that it is probable that there will be suffi cient taxable profi ts against which to utilise the benefi ts of the temporary differences and they are expected to reverse in the foreseeable future.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period(s) when the asset and liability giving rise to them are realised or settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by reporting date. The measurement of deferred tax liabilities and assets refl ects the tax consequences that would follow from the manner in which the Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis.

Current and deferred tax for the periodCurrent and deferred tax is recognised as an expense or income in the income statement, except when it relates to items credited or debited directly to equity, in which case the deferred tax is also recognised directly in equity, or where it arises from the initial accounting for a business combination, in which case it is taken into account in the determination of goodwill or excess.

Tax consolidationThe Company and all its wholly-owned Australian resident entities formed a tax-consolidated Group with effect from 1 July 2005. Entities within the tax-consolidated Group intend to enter into a tax funding arrangement and a tax-sharing agreement with the head entity Q Ltd. The decision to tax consolidate has been formally notifi ed to the Australian Taxation Offi ce. The head entity assumes all tax payable, with the carrying amount of investments in subsidiaries being increased by the tax consolidation contributions and reduced by tax consolidation distributions. All impacts are fully eliminated on consolidation.

The tax sharing agreement between members of the tax-consolidated Group will provided for the determination of the allocation of income tax liabilities between the entities should the head entity default on its tax payment obligations.


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o. Intangible assetsIntangible assets acquired separatelyIntangible assets acquired separately are recorded at cost less accumulated amortisation and impairment. Amortisation is charged on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation method is reviewed at the end of each annual reporting period, with any changes in these accounting estimates being accounted for on a prospective basis.

Internally-generated intangible assets – research and development expenditureExpenditure on research activities is recognised as an expense in the period in which it is incurred. Where no internally-generated intangible asset can be recognised, development expenditure is recognised as an expense in the period as incurred.

An intangible asset arising from development (or from the development phase of an internal project) is recognised if, and only if, all of the following have been demonstrated:

the technical feasibility of completing the intangible asset so that it will be available for use or sale;• the intention to complete the intangible asset and use or sell it;• the ability to use or sell the intangible asset;• how the intangible asset will generate probable future economic benefi ts;• the availability of adequate technical, fi nancial and other resources to complete the development and to • use or sell the intangible asset; andthe ability to measure reliably the expenditure attributable to the intangible asset during its development.•

The amount initially recognised for internally-generated intangible assets is the sum of the expenditure incurred from the date when the intangible asset fi rst meets the recognition criteria listed above.

Subsequent to initial recognition, internally-generated intangible assets are reported at cost less accumulated amortisation and accumulated impairment losses, on the same basis as intangible assets acquired separately.

Intangible assets acquired in a business combinationIntangible assets acquired in a business combination are identifi ed and recognised separately from goodwill where they satisfy the defi nition of an intangible asset and their fair values can be measured reliably.

Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less accumulated amortisation and accumulated impairment losses, on the same basis as intangible assets acquired separately.

p. Leased assets

Leases are classifi ed as fi nance leases when the terms of the lease transfer substantially all the risks and rewards incidental to ownership of the leased asset to the lessee. All other leases are classifi ed as operating leases.

Assets held under fi nance leases are initially recognised at their fair value or, if lower, at amounts equal to the present value of the minimum lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is included in the balance sheet as a fi nance lease obligation.

Lease payments are apportioned between fi nance charges and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly against income.

Finance leased assets are amortised on a straight line basis over the estimated useful life of the asset.

Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefi ts from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.

Lease incentivesIn the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefi ts of incentives are recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefi ts from the leased asset are consumed.


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q. Property, plant and equipmentPlant and equipment, leasehold improvements and equipment under fi nance lease are stated at cost less accumulated depreciation and impairment. Cost includes expenditure that is directly attributable to the acquisition of the item. In the event that settlement of all or part of the purchase consideration is deferred, cost is determined by discounting the amounts payable in the future to their present value as at the date of acquisition.

Depreciation is provided on property, plant and equipment. Depreciation is calculated using either straight line or diminishing value based on the assed appropriateness of each method for each entity within the Group. Leasehold improvements are depreciated over the period of the lease or estimated useful life, whichever is the shorter. The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual reporting period, with the effect of any changes recognised on a prospective basis.

The following estimated useful lives are used in the calculation of depreciation:

Class of Fixed Asset Years of Useful LifePlant and equipment 4 - 8 yearsFurniture and fi ttings 8 yearsLeased plant and equipment 3 - 8 years

Motor vehicles 3 - 5 years Leasehold improvements 4-5 years

r. ProvisionsProvisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at reporting date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash fl ows estimated to settle the present obligation, its carrying amount is the present value of those cash fl ows.

When some or all of the economic benefi ts required to settle a provision are expected to be recovered from a third party, the receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.

Contingent liabilities acquired in a business combinationContingent liabilities acquired in a business combination are initially measured at fair value at the date of acquisition. At subsequent reporting dates, such contingent liabilities are measured at the higher of the amount that would be recognised in accordance with AASB 137 ‘Provisions, Contingent Liabilities and Contingent Assets’ and the amount initially recognised less cumulative amortisation recognised in accordance with AASB 118 ‘Revenue’.


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s. RevenueRevenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, stock rotation, price protection, rebates and other similar allowances.

Rendering of servicesRevenue from a contract to provide services is recognised by reference to the stage of completion of the contract. The stage of completion of the contract is determined as follows:

servicing fees included in the price of products sold are recognised by reference to the proportion of the • total cost of providing the servicing for the product sold, taking into account historical trends in the number of services actually provided on past goods sold;revenue from time and material contracts is recognised at the contractual rates as labour hours are delivered • and direct expenses are incurred.

RoyaltiesRoyalty revenue is recognised on an accrual basis in accordance with the substance of the relevant agreement. Royalties determined on a time basis are recognised on a straight-line basis over the period of the agreement. Royalty arrangements that are based on production, sales and other measures are recognised by reference to the underlying arrangement.

Dividend and interest revenueDividend revenue from investments is recognised when the shareholder’s right to receive payment has been established.

Interest revenue is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the fi nancial asset to that asset’s net carrying amount.

t. Share-based payments Equity-settled share-based payments with employees and others providing similar services are measured at

the fair value of the equity instrument at the grant date. Fair value is measured by use of the Black Scholes Model. The expected life used in the model has been adjusted, based on management’s best estimate, for the effects of non- transferability, exercise restrictions and behavioural considerations. Further details on how the fair value of equity- settled share-based transactions has been determined can be found in note 27.

The fair value determined at the grant date of the equity-settled share-based payment is expensed on a straight-line basis over the vesting period, based on the Group’s estimate of equity instruments that will eventually vest.

At each reporting date, the Group revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimate, if any, is recognised in profi t or loss over the remaining vesting period, with corresponding adjustment to the equity-settled employee benefi ts reserve.


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u. Critical accounting judgments and key sources of estimation uncertainty

Critical judgements in applying the entity’s accounting policies The following are the critical judgements (apart from those involving estimations which are dealt with below), that management has made in the process of applying the Group’s accounting policies and that have the most signifi cant effect on the amounts recognised in the fi nancial statements:

Revenue recognition

The Group’s general policy of revenue recognition is that revenue is recognised when the product/service has been delivered or performed which is in line with AASB 118. Management judgement is required in determining the level of completion of product and services transferred to clients and to recognise the revenue accordingly.

Employee entitlements

Management judgement is applied in determining the following key assumptions used in the calculation of long service leave at balance date:

future increases in wages and salaries;- future on cost rates; and - experience of employee departures and period of service.-

Key sources of estimation uncertaintyThe following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the balance sheet date, that have a signifi cant risk of causing a material adjustment to the carrying amounts of asset and liabilities within the next fi nancial year:

Intangible assets

Useful lives of intangible assets with fi nite lives are reviewed annually. Any reassessment of useful lives in a particular year will affect the amortisation expense (either increasing or decreasing) through to the end of the reassessed useful life for both the current and future years. Details of the assumptions used are provided in note 14.

Impairment of goodwill

Determining whether goodwill is impaired requires an estimation of the value in use of the cash generating units to which goodwill has been allocated. The value in use calculation requires the entity to estimate the future cash fl ows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate the present value.

The carrying amount of goodwill at the balance sheet date was $28,485,861 (2008: $20,514,171). No impairment has been taken to account to date. Details on impairment testing calculations are provided in note 14.


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2009$

2008$

2009$

2008$

NOTE 2: REVENUE


Operating activities

rendering of services 27,117,293 26,099,169 - 2,357

interest received from bank deposits 130,528 223,489 56,058 136,719

Other 46,569 - 444,864 -

Total Revenue 27,294,390 26,322,658 500,922 139,076


Revenue from rendering of services - 243,015 - -

Total revenue - 243,015 - -

Total Revenue from continuing and discontinuing operations 27,294,390 26,565,673 500,922 139,076

NOTE 3: PROFIT/(LOSS) FOR THE YEAR


Profi t/(loss) from ordinary activities before income tax has been determined after:

GENERAL EXPENSES

Finance costs:

Other entities 24,317 41,242 13,537 10481

Finance lease fi nance charges 11,331 2,675 11,331 -

Total borrowing costs 35,648 43,917 24,868 10,481

Depreciation (continuing activity):

Plant and equipment 244,881 315,084 22,220 34,631

Furniture and fi ttings 38,957 42,255 9,377 8,615

Leasehold improvements 21,244 25,063 662 -

Motor Vehicle 5,625 7,258 - -

Total depreciation (continuing activity) 310,707 389,660 32,259 43,246

Depreciation (discontinued activity):

Plant and equipment - 6,483 - -

Furniture and fi ttings - 856 - -

Total depreciation (discontinued activity) - 7,339 - -

Total depreciation (continuing and discontinued activity) 310,707 396,999 32,259 43,246

Amortisation Continuing activity):

Amortisation of database 398,212 217,181 - -

Amortisation of Website 78,988 35,809 78,988 35,809

Total Amortisation 477,200 252,990 78,988 35,809

Total Depreciation and Amortisation (continuing activity) 787,907 642,650 111,247 79,055


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NOTE 3: PROFIT/(LOSS) FOR THE YEAR (Cont.)


2009$

2008$

2009$

2008$

Rental expense on operating leases

Minimum lease payments 760,981 822,328 89,276 53,840

Share-based payments:

Equity-settled share-based payment 90,343 80,844 90,343 80,844


Depreciation - 7,339 - -

- 7,339 - -

NOTE 4: LOSS FOR THE YEAR

CONSOLIDATED

Continuing Discontinued Total

2009 2008 2009 2008 2009 2008

$ $ $ $ $ $

a ) Losses incurred (losses has been arrived at after charging the following loss to the account)

Loss on disposal of Division - - - 769,351 - 769,351

b) Signifi cant expenses (loss for the year includes the following expenses)

Employee benefi ts 12,415,449 11,933,367 - 710,483 12,415,449 12,643,850

Depreciation and amortisation expense 787,907 642,650 - 7,339 787,907 649,989

Share based payments 90,343 80,844 - - 90,343 80,844

Total Signifi cant expenses 13,293,699 12,656,861 - 717,822 13,293,699 13,374,683

COMPANY

Continuing Discontinued Total

2009 2008 2009 2008 2009 2008

$ $ $ $ $ $

Losses incurred (losses has been arrived at after charging the following loss to the account)a)

Loss on disposal of investment - - - 769,351 - 769,351

Signifi cant expenses (loss for the year includes the following expenses)b)

Employee benefi ts 1,310,257 1,111 - - 1,310,257 1,111

Depreciation and amortisation expense 111,247 10,481 - - 111,247 10,481

Share based payments 90,343 - - - 90,343 -

Total Signifi cant expenses 1,511,847 11,592 - - 1,511,847 11,592


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2009$

2008$

2009$

‘2008$

NOTE 5: INCOME TAX EXPENSE

aThe components of tax expense (benefi t) comprise:

Current tax 155,730 (117,025) (735,449) (789,608)

Deferred tax expense/(income) relating to the origination and reversal of temporary differences 77,967 (194,472) 53,543 105,505

Current tax arising from under provision in prior years 155,463 - - -

Total tax expense (benefi t) 389,160 (311,497) (681,906) (684,103)

Current and deferred tax attributable to continuing operations 389,160 (76,245) (681,906) (684,103)

Current and deferred tax attributable to discontinued operations - (235,252) - -

b. The prima facie tax on loss from ordinary activities before income tax is reconciled to the income tax credit as follows:

Profi t/(Loss) from continuing operations 774,064 530,263 (1,894,611) (1,537,730)

Loss from discontinued operations - (1,616,337) - -

Profi t(Loss) from operations 774,064 (1,086,074) (1,894,611) (1,537,730)

Income tax expense (benefi t) calculated at 30% 232,219 (325,822) (568,383) (461,320)

Tax effect of:

Effect of expenses that are not deductible in determining taxable profi t 195,039 555,512 107,240 (16,304)

Effect of timing differences not previously recognised (193,562) (541,187) (220,763) (206,479)

Effect of under provision in prior years 115,463 - - -

Income tax expense (benefi t) attributable to entity 389,160 (311,497) (681,906) (684,103)

The tax rate used in the above reconciliation is the corporate tax rate of 30% payable by Australian corporate entities on taxable profi ts under Australian tax law. There has been no change in the corporate tax rate when compared with the previous reporting period.


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NOTE 6: KEY MANAGEMENT PERSONNEL DISCLOSURES

a. Names and positions held of Consolidated and Parent Entity Key Management Personnel in offi ce at any time during the fi nancial year are:

Parent Entity Directors

Directors

Mr B R Bennie Director — Non-Executive

Mr K V Campbell Chairman — Non-Executive

Mr P G Choiselat Director — Executive

Mr M Halstead Director —Executive

Hon J G Kennett Director — Non-Executive (resigned 20 October 2008)

Mr A H S Koo Director—Non-Executive

Executives

Ms M A Chuah

Ms C Chan

Company Secretary/CFO

Company Secretary

b. Compensation Practices

Refer Remuneration Report segment of the Directors’ Report.

c. Compensation Options

FY 2009

Balance 01.07.08

option consol-idation 100:1

Received as Remun-

erationExercised

No. Options forfeited

Balance 30.06.09

Balance vested at 30.06.09

Vested and excer-cisable at 30.06.09

Options vested

during the year


Mr B R Bennie 666,667 (660,000) - - - 6,667 3,333 3,333 3,333

Mr K V Campbell 1,500,000 (1,485,000) - - - 15,000 10,000 10,000 5,000

Mr P G Choiselat 1,500,000 (1,485,000) - - - 15,000 10,000 10,000 5,000

Hon J G Kennett 1,000,000 (990,000) - - (3,334) 6,666 3,333 3,333 -

Mr A H S Koo 1,500,000 (1,485,000) - - - 15,000 10,000 10,000 5,000

Mr M Halstead 666,667 (660,000) - - - 6,667 3,333 3,333 3,333

Sub-total 6,833,334 (6,765,001) - - (3,334) 65,000 39,999 39,999 21,666

Parent Entity Executives

Ms M A Chuah - - - - - - - - -

Ms C Chan - - - - - - - - -

Sub-total - - - - - - - - -

Total 6,833,334 - - - - 65,000 39,999 39,999 21,666


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NOTE 6: KEY MANAGEMENT PERSONNEL DISCLOSURES (Cont.)

c. Compensation Options (Cont.) FY 2008

Balance 01.07.07

Received as Remun-

eration Exercised No. Balance 30.06.08

Balance vested at 30.06.08

Vested and excercisable at 30.06.08

Options vested

during the year


Mr B R Bennie 1,000,000 - (333,333) 666,667 333,333 - 333,333

Mr K V Campbell 1,500,000 - - 1,500,000 500,000 500,000 500,000

Mr P G Choiselat 1,500,000 - - 1,500,000 500,000 500,000 500,000

Hon J G Kennett 1,000,000 - - 1,000,000 333,333 - 333,333

Mr A H S Koo 1,500,000 - - 1,500,000 500,000 500,000 500,000

Mr M Halstead 1,000,000 - (333,333) 666,667 333,333 333,333 333,333

Sub-total 7,500,000 (666,666) 6,833,334 2,499,999 1,833,333 2,499,999


Ms M A Chuah - - - - - - -

Sub-total - - - - - - -

Total 7,500,000 - (666,666) 6,833,334 2,499,999 1,833,333 2,499,999

d. Shares issued on Exercise of Compensation Options.

There were no shares issued on exercise of compensation options in FY2009.

The compensation of the Key Management Personnel of the consolidated and parent entity, is set out below:


2009$

2008$

2009$

2008$

Short-term employee benefi ts 961,561 821,118 961,561 821,118

Share based payment 8,804 25,860 8,804 25,860

Post-employment benefi ts 33,518 46,080 33,518 46,080

Other long term employee benefi ts 71,000 - 71,000 -

Termination benefi ts - - - -

Total Compensation 1,074,883 893,058 1,074,883 893,058


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NOTE 6: KEY MANAGEMENT PERSONNEL COMPENSATION (Cont.)

Shareholdings

Key Management Personnel

FY 2009Balance 01.07.08

Share consol-idation 100:1

Received as Remun-

erationOptions

ExercisedPurchases and sales Other

Balance 30.06.09


Mr B R Bennie 1,033,333 (1,022,999) - - - - 10,334

Mr K V Campbell 6,564,572 (6,498,925) - - 91,907 - 157,554

Mr P G Choiselat 54,054,127 (53,513,579) - - 5,792,870 - 6,333,418

Hon J G Kennett 10,239,599 (10,137,201) - - - - 102,398

Mr A H S Koo 8,500,000 (8,415,000) - - 119,000 - 204,000

Mr M Halstead 7,482,306 (7,407,482) - - 104,755 - 179,579

Sub-total 87,873,937 (86,995,186) - - 6,108,532 - 6,987,283


Ms M A Chuah 2,080,000 (2,059,200) - - - - 20,800

Ms C Chan - - - - 100,000 - 100,000

Sub-total 2,080,000 (2,059,200) - - 100,000 - 120,800

Total 89,953,937 (89,054,386) - - 6,208,532 - 7,108,083

Shareholdings

Key Management Personnel

FY 2008Balance 01.07.07

Received as Remun-

erationOptions

ExercisedPurchases and sales Other

Balance** 30.06.08


Mr B R Bennie 500,000 - 333,333 200,000 - 1,033,333

Mr K V Campbell 4,120,000 - - 2,444,572 - 6,564,572

Mr P G Choiselat 94,802,609 - - 74,831,524 (115,580,006)* 54,054,127

Hon J G Kennett 5,188,894 - - 5,050,705 - 10,239,599

Mr A H S Koo 6,250,000 - - 2,250,000 - 8,500,000

Mr M Halstead 13,456,700 - 333,333 (6,307,727) - 7,482,306

Sub-total 124,318,203 - 666,666 78,469,074 (115,580,006) 87,873,937


Ms M A Chuah 900,000 - - 1,180,000 - 2,080,000

Sub-total 900,000 - - 1,180,000 - 2,080,000

Total 125,218,203 - 666,666 79,649,074 (115,580,006) 89,953,937

* 115,580,006 shares lodged with Opes Prime as collateral under margin lending facility are currently under dispute.** Balance of shares as per share register.


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2009$

2008$

2009$

2008$

NOTE 7: AUDITORS’ REMUNERATION

Remuneration of the auditor of the parent entity for:

— auditing or reviewing the fi nancial report 87,957 60,538 87,957 60,538

— Due diligence assistance - 53,450 - 53,450

87,957 113,988 87,957 113,988

NOTE 8: EARNINGS PER SHARE

a. Reconciliation of earnings to net profi t

Continuing and discontinued operations

Net profi t/(loss) 384,904 (774,577)

Net profi t/(loss) used in the calculation of basic EPS 384,904 (774,577)

Net profi t/(loss) used in the calculation of dilutive EPS 384,904 (774,577)


Net profi t 384,904 606,508

Net profi t used in the calculation of basic EPS 384,904 606,508

Net profi t used in the calculation of dilutive EPS 384,904 606,508

b. Weighted average number of ordinary shares outstanding during the year used in calculation of basic EPS 9,455,902 7,723,889

Weighted average options currently considered dilutive - 71,457

Weighted average number of ordinary shares outstanding during the year used in calculation of dilutive EPS 9,455,902 7,795,346

Basic earnings per share

From continuing operations 4.1 8.0

From discontinued operations - (18.0)

From continuing and discontinued operations (cents) 4.1 (10.0)

Diluted earnings per share

From continuing operations 4.1 8.0

From discontinued operations - (18.0)

From continuing and discontinued operations (cents) 4.1 (10.0)


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2009$

2008$

2009$

‘2008$

NOTE 9: CASH AND CASH EQUIVALENTS

Cash at bank 2,428,774 4,836,702 135,145 2,200,753

Cash on hand 722 539 - -

2,429,496 4,837,241 135,145 2,200,753

Reconciliation of Cash

Cash at the end of the fi nancial year as shown in the statement of cash fl ows is reconciled to items in the statement of fi nancial position as follows:

Cash 2,429,496 4,837,241 135,145 2,200,753

NOTE 10: TRADE AND OTHER RECEIVABLES

CURRENT

Trade debtors 4,922,409 5,462,279 - 96,637

Allowance for doubtful debt (162,384) (278,779) - (89,112)

4,760,025 5,183,500 - 7,525

Other debtors 260,493 246,237 5,102 8,147

Goods and services tax recoverable - - 34,086 34,649

Amounts receivable - controlled entities - - 2,667,053 1,905,785

260,493 246,237 2,706,241 1,948,581

5,020,518 5,429,737 2,706,241 1,956,106

Ageing of past due but not impaired

60-90 days 664,458 451,104

90 days plus 535,443 591,943

Total 1,199,901 1,043,047

The average credit period on rendering of services is 60 days. The Group does not charge interest on the trade receivables for amounts owing past the due date neither does it hold collateral over these balances. A provision for doubtful debts has been provided for estimated irrecoverable trade receivable past credit period determined on past default experience and the change in quality of trade receivables.

The larger amounts in the trade receivables balance consist mostly of long standing clients that have a good payment history. There is one customer who in isolation represents more than 5% of the total balance of the trade receivable at 30 June 2009. 37% of the total debt of that customer was in 60 days plus. Management is of the opinion that this customer is a low level risk due to its size as a market player and its payment history. 59% of the amount was subsequently paid by August 2009 bringing its total debt to below 5% of the overall balance.


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2009$

2008$

2009$

2008$

NOTE 10: TRADE AND OTHER RECEIVABLES (Cont.)

Movement in allowance for doubtful debts

Balance at beginning of the year 278,778 110,272 89,112 89,112

Impairment losses recognised on receivables 68,233 168,506 - -

Amounts written off as uncollectible (172,100) - (89,112) -

Amounts recovered during the year (5,580) - - -

Impairment losses reversed (6,947) - - -

Balance at the end of the year 162,384 278,778 - 89,112

Ageing of impaired trade receivables

90 days plus 162,384 278,778 - 89,112

Total 162,384 278,778 - 89,112

NOTE 11: OTHER ASSETS

CURRENT

Prepayments 52,101 82,328 2,883 64,818

NOTE 12: OTHER FINANCIAL ASSETS

NON-CURRENT

Total listed investments at cost 18,677 18,677 - -

Investments in subsidiaries at cost - - 31,588,093 23,619,234

Total non-current investments - - 31,588,093 23,619,234

Total investments 18,677 18,677 31,588,093 23,619,234


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2009$

2008$

2009$

2008$

NOTE 13: PLANTAND EQUIPMENT

Plant and equipment

At cost 1,183,616 879,541 114,301 83,598

Accumulated depreciation (718,746) (384,625) (38,119) (34,631)

464,870 494,916 76,182 48,967

Furniture and Fittings

At cost 341,113 225,973 62,013 63,255

Accumulated depreciation (206,164) (51,565) (17,762) (8,615)

134,949 174,408 44,251 54,640

Leasehold improvements

At cost 323,443 255,319 54,004 -

Accumulated amortisation (67,384) (25,910) (662) -

256,059 229,409 53,342 -

Leased Motor Vehicle

Capitalised leased assets 53,465 55,438 - -

Accumulated depreciation (36,063) (30,438) - -

17,402 25,000 - -

Total Plant and Equipment 873,280 923,733 173,775 103,607


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NOTE 13: PLANT AND EQUIPMENT (Cont.)

a. Movements in Carrying Amounts

Movement in the carrying amounts for each class of property, plant and equipment between the beginning and the end of the current fi nancial year

Leasehold improvement

Plant and Equipment

Furniture and Fittings

Leased Plant and

EquipmentMotor Vehicle Total

$ $ $ $ $ $

Consolidated Entity:

Balance at 1 July 2007 16,309 309,539 47,548 - 32,258 405,654

Additions 146,193 326,741 107,442 - - 580,376

Disposal (6,829) (440) (24,239) - - (31,508)

Acquisitions through business combinations 98,799 180,643 86,768 - - 366,210

Depreciation of discontinued operations - (6,483) (856) - - (7,339)

Depreciation of continuing operations (25,063) (315,084) (42,255) - (7,258) (389,660)

Carrying amount at 30 June 2008 229,409 494,916 174,408 - 25,000 923,733

Additions 54,004 214,896 5,563 - - 274,463

Disposal (6,110) (61) (6,065) - (1,973) (14,209)

Depreciation of continuing operations (21,244) (244,881) (38,957) - (5,625) (310,707)

Carrying amount at 30 June 2009 256,059 464,870 134,949 - 17,402 873,280

Parent Entity:

Balance at 1 July 2007 - - - - - -

Additions - 83,598 63,255 - - 146,853

Depreciation of discontinued operations - (34,631) (8,615) - - (43,246)

Carrying amount at 30 June 2008 - 48,967 54,640 - - 103,607

Additions 54,004 49,435 1,493 - - 104,932

Depreciation of continuing operations (662) (22,220) (9,377) - - (32,259)

Disposal - - (2,505) - - (2,505)

Carrying amount at 30 June 2009 53,342 76,182 44,251 - - 173,775


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NOTE 14: INTANGIBLES


2009$

2008$

2009$

2008$

Goodwill

Balance at beginning of fi nancial year 20,514,171 5,829,479 - -

Derecognised on disposal of Axis Media Pty Ltd - (801,780) - -

Deferred consideration paid in relation to business combinations in prior years 7,971,690 614,811 - -

Additions from business combinations in the current year 24 - 14,871,661 - -

Net carrying value 28,485,861 20,514,171 - -

Website and other intangibles

Balance at beginning of the fi nancial year 569,556 - 153,428 -

Addition on acquisition - 277,036 - -

Net additions 510,597 292,520 - 153,428

Amortisation for the year (477,200) - (78,988) -

Net carrying value 602,953 569,556 74,440 153,428

Total Intangible assets 29,088,814 21,083,727 74,440 153,428

The additions to goodwill comprise mainly deferred payments of prior period acquisitions. The purchase agreements for those acquisitions provide for deferred payments tied to their future EBIT performance. The deferred payments includes all payments calculated on performance up to 30 June 2009.

The website and other intangible assets are amortised over their estimated life span of between 2 to 5 years depending on each asset. The asset lifespan is estimated by management based on experience of similar past assets.

Per AASB 136, management reviewed the carrying amounts of its intangible assets including goodwill and estimated the recoverable amount of the said assets in order to determine if any impairment to the carrying amounts of its assets were required.

For the purpose of impairment testing, the Group is deemed to be operating as one CGU and therefore the total carrying value of the intangible assets including goodwill were testing using the Net Present Value calculation. The following assumptions have been adopted as part of the Net Present Value calculation:

weighted average cost of capital (WACC) = 21.11 %-

estimated growth in EBITDA FY 2010 compared to annualised 2- nd half of FY 2009 = 100% (as a result of new products and services and cost rationalisation)

estimated year on year EBITDA growth = 12%-

The Net Present Value of the total intangible assets calculated using the stated assumptions were greater than the carrying value. Management was satisfi ed that no impairment was required as at 30 June 2009.


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Consolidated Company

2009$

2008$

2009$

2008$

NOTE 15: TRADE AND OTHER PAYABLES

CURRENT

Unsecured liabilities

Trade payables 1,754,841 2,969,334 64,891 118,464

Sundry payables and accrued expenses 2,812,090 990,055 756,661 186,882

Deferred consideration payable 5,945,340 4,143,584 5,945,340 4,143,584

Goods and services tax payable 376,791 430,406 - -

Billings in advance 261,130 482,513 - 2,387

11,150,192 9,015,892 6,766,892 4,451,317

NON-CURRENT (secured)

Amounts payable – controlled entities - - 5,868,921 2,301,623

- - 5,868,921 2,301,623

In general, the average credit period on purchases is 30 days however certain purchases are only payable upon receipt of income related to the purchase such as site invoices etc. The Group has fi nancial risk management in place to ensure that all payables are paid within the credit timeframe.

NOTE 16: TAX

Deferred tax asset comprises:

Opening balance 2,960,294 2,648,797 3,250,098 2,565,995

Temporary differences (77,967) 194,472 (53,543) (105,505)

2,882,327 2,843,269 3,196,555 2,460,490

Tax losses - 117,025 735,449 789,608

2,882,327 2,960,294 3,932,004 3,250,098

Taxable and deductible temporary differences arise from the following:

Gross deferred tax assets

Depreciation – accounting 113,337 179,757 29,178 12,974

Amortisation – accounting 119,447 56,046 - -

Provision – Employee entitlements 132,667 33,668 1,963 33,668

Provisions – other 150,642 72,750 9,588 40,030

Other 142,683 485,141 25,228 18,680

Closing balance 658,776 827,362 65,957 105,352

Gross deferred tax liabilities

Business development 12,235 34,387 12,235 39,060

Depreciation – tax 232,784 179,757 29,178 2,974

Provisions – employee entitlements 130,287 141,539 11,572 671

Provisions - other 112,359 185,706 12,714 8,532

Other movements 249,078 91,501 53,801 149,620

Closing balance 736,743 632,890 119,500 210,857

Net temporary difference (77,967) 194,472 (53,543) (105,505)


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2009$

2008$

2009$

2008$

NOTE 17: BORROWINGS

CURRENT (secured)

Commercial Bills 17a. 250,000 - 250,000 -

Finance lease liabilities 21 20,000 42,073 - -

270,000 42,073 250,000 -

NON-CURRENT (secured)

Finance lease liabilities 21 9,638 7,908 - -

9,638 7,908 - -

a. Commercial bills

The commercial bills payable by the Company are secured by a registered fi rst mortgage over all of the assets and undertakings of the Company.

NOTE 18: PROVISIONS

CURRENT

Balance at 1 July 403,828 141,224 7,350 -

Additional provision 580,754 455,322 39,589 7,350

Amounts used (599,001) (365,823) (26,353) -

Transfer on disposal of division - (32,429) - -

Provision acquired - 205,534 - -

Balance at 30 June 18a 385,581 403,828 20,586 7,350

NON-CURRENT

Balance at 1 July 35,540 24,298 - -

Additional provision 46,931 - 17,986 -

Amounts used - - - -

Transfer on disposal of division 18a - - - -

Transfer on acquisition of division 11,242 - -

82,471 35,540 17,986 -

a Aggregate employee benefi ts liability 486,299 439,368 38,572.00 7,350

b. Number of employees at year-end 121 143 5 5


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2009$

2008$

2009$

2008$

NOTE 19: ISSUED CAPITAL

ISSUED CAPITAL

10,206,626 (2008: 853,770,331) Fully paid ordinary shares 19a 41,392,828 39,170,024 41,392,828 39,170,024

41,392,828 39,170,024 41,392,828 39,170,024

a. Ordinary shares

At the beginning of the reporting period 39,170,024 23,197,935

114,234,936 at 6.3 cents per share on 31/07/2007 7,196,801



exercise of the option on 5/12/2007 31,267

Value of options transferred from reserve 5/12/07 9,571

105, 691, 970 at 5.00cents per share on 31/12/2007 5,284,598

2,910,518 at 5.84 cents per share on 05/03/2008 66,984

752,708 at 5.84 cents per share on 03/06/2008 43,958

4,571,788 at 6.44 cents per share on30/06/2008 294,423

725,808 at 5.58 cents per share on 23/07/2008 40,501

61,283 at $1.28 per share on 9/12/2008 78,436

557,566 at $1.27 per share on 9/12/2008 708,109

803,417 at $1.70 per share on 9/12/2008 1,365,805

38,913 at $1.35 per share on 30/06/2008 52,530

200,000 at $0.35 per share on 24/12/2008 70,000

Share issue costs (92,577) (856,868)

At end of year 41,392,828 39,170,024


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NOTE 19: ISSUED CAPITAL (Cont.)

2009 2008

No. No.

No. of shares at the beginning of reporting period

At the beginning of the reporting period 853,770,331 571,174,514

Shares issued during year

- 31/07/2007 114,234,936

- 27/08/2007 28,921,301

- 10/10/2007 24,345,930

- 05/12/2007 1,166,666

- 31/12/2007 105,691,970

- 05/03/2008 2,910,518

- 03/06/2008 752,708

- 30/06/2008 4,571,788

- 23/07/2008 725,808

- 30/10/2008 (consolidation of capital 1:100) (845,950,692)

- 09/12/2008 61,283

- 09/12/2008 1,360,983

- 11/12/2008 38,913

- 24/12/2008 200,000

At end of year 10,206,626 853,770,331

b. Shares

Ordinary shares participate in dividends and the proceeds on winding up of the Company in proportion to the number of shares held.

At shareholders meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on show of hands.

The Company consolidated its capital on the basis of 1 share for every 100 held in November 2008.


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2009$

2008$

2009$

2008$

NOTE 20: RESERVES

Equity-settled employee benefi ts 226,029 135,686 226,029 135,686

Foreign currency translation (121,917) (60,701) - -

104,112 74,985 226,029 135,686

Equity-settled employee benefi ts reserve

Balance at beginning of fi nancial year 135,686 64,413 135,686 64,413

Share-based payment 90,343 80,844 90,343 80,844

Value of options transferred to issued capital - (9,571) - (9,571)

Balance at end of fi nancial year 226,029 135,686 226,029 135,686

The equity-settled employee benefi ts reserve arises on the grant of share options to executives and senior employees under the employee share option plan. Amounts are transferred out of the reserve and into issued capital when the options are exercised. Further information about share-based payments to employees is made in note 27 to the fi nancial statements.


2009$

2008$

2009$

2008$

Foreign currency translation reserve

Balance at beginning of fi nancial year (60,701) 6,123 - -

Translation of foreign operations (61,216) (66,824) - -

Balance at end of fi nancial year (121,917) (60,701) - -

Exchange differences relating to the translation from the functional currencies of the Group’s foreign controlled entities into Australian dollars are brought to account by entries made directly to the foreign currency translation reserve.


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2009$

2008$

2009$

2008$

NOTE 21: CAPITAL AND LEASING COMMITMENTS

Finance Lease Commitments

Non-cancellable fi nance leases contracted for and capitalised in the fi nancial statements

— not later than 12 months 22,230 45,055 - -

— later than 12 months but not later than 5 years 9,968 8,772 - -

Minimum fi nance lease payments 32,198 53,827 - -

Less future fi nance charges (2,560) (3,846) - -

Total fi nance lease liability 29,638 49,981 - -

The Company and economic entity have an option to purchase the asset at the expiry of the lease period.

Non cancellable operating lease commitments

Non-cancellable operating leases contracted for but not capitalised in the fi nancial statements

Payable


2009$

2008$

2009$

2008$

— not later than 12 months 572,243 680,069 336,734 294,288

— later than 12 months but not later than 5 years 484,644 973,736 289,468 569,555

Total liability 1,056,887 1,653,805 626,202 863,843

Operating leases relate to premises occupied by the Group with lease terms of between 2 and 4 years. The Group does not have an option to purchase the premises at the expiry of the lease periods.


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2009$

2008$

2009$

2008$

NOTE 22: CASH FLOW INFORMATION

a. Reconciliation of Cash Flow from Operations with Profi t/(Loss) for the year

Profi t/(Loss) for the year 384,904 (774,577) (1,212,705) (1,600,931)

Non-cash fl ows in profi t from ordinary activities

Depreciation and amortisation 787,907 649,989 111,247 79,055

Net gain on disposal of property, plant and equipment - (6,722) - -

Net loss on disposal of discontinued operations - 769,351 - 747,303

Equity settled share based payment 90,343 80,844 90,343 80,844

(Increase)/Decrease in trade and term debtors 409,220 (1,772,014) 73,068 367,615

Decrease in trade creditors and accruals (217,114) (406,550) (197,954) (734,204)

(Increase)/Decrease in Deferred tax asset 389,160 (311,497) (681,906) (684,103)

Increase in provisions 28,684 273,846 31,222 7,350

Cash fl ow from(used in) operations 1,873,104 (1,497,330) (1,786,685) (1,737,071)

b. Credit Standby Arrangements with Banks

Credit facility 500,000 500,000 500,000 500,000

Amount utilised (250,000) - (250,000) -

Unused credit facility 250,000 500,000 250,000 500,000

The major facilities are summarised as follows:

Bank Overdraft 250,000 250,000 250,000 250,000

Fully fl uctuating bank overdraft facility, with the general terms and conditions being set and agreed to annually. Interest rates are variable and subject to adjustment. This is not utilised

Commercial Bill Facility (the interest rate used is the Bank Bill Swap Rate). 250,000 250,000 250,000 250,000


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NOTE 23: CONTROLLED ENTITIES

a. Controlled Entities

Country of Incorporation Percentage Owned

2009 2008

% %

Parent Entity:

Q Ltd Australia - -

Subsidiaries of Q Ltd:

3 Dimension Interactive Pty Ltd Australia 100 100

3 Dimension Interactive (NZ) Pty Limited New Zealand 100 -

Axis Media Communications Pty Ltd Australia 100 100

Biolytica Holdings Pty Ltd Australia 100 100

Clear Blue Day Pty Ltd Australia 100 100

First Rate Ltd New Zealand 100 100

First Rate (Aust) Pty Ltd Australia 100 100

Freestyle Media Group Pty Ltd Australia 100 100

Freestyle Web Pty Ltd Australia 100 100

List Marketing Australasia Pty Ltd Australia 100 100

Market United Pty Ltd Australia 100 100

Mosaic Traffi c Pty Ltd Australia 100 100

The Great Australian Survey Pty Ltd Australia 100 100

Q NZ Ltd New Zealand 100 100

b. Controlled Entities Purchased

The goodwill arising on acquisitions made in the prior year has been adjusted by an additional $7,971,690 resulting from deferred obligations that are tied to the performance of the respective businesses for the year ended 30 June 2009.

This has no effect on the reported result in the prior year.


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NOTE 24: ACQUISITION OF BUSINESSES

Names of businesses acquired Principal activityDate of

settlement

Proportion of shares acquired

%

Cost of acquisition

$

Acquisitions in 2008/09

There were no acquisitions made in FY 2009

Acquisitions in 2007/08

Clear Blue Day Pty Ltd Digital Marketing Agency 17/08/2007 100 322,466

Market United Pty Ltd Digital Marketing Agency 16/08/2007 100 4,555,991

The Great Australian Survey Pty Ltd Permission based data for direct marketing and research 04/10/2007 100 12,218,423

Total in 2007/08 17,096,880

Fair value of assets and liabilities acquired in FY 2008

Balance sheet itemClear Blue Day

Pty LtdMarket United

Pty Ltd

The Great Australian

Survey Pty Ltd Total

Fair value $ Fair value $ Fair value $ Fair value $

Current assets:

Cash 35,300 417,889 1,073,294 1,526,483

Trade debtors 268,206 230,760 1,239,766 1,738,732

Other receivables 97,606 81,461 35,987 215,054

Total current assets 401,112 730,110 2,349,047 3,480,269

Non current assets:

Shares - 18,677 - 18,677

Other asset 11,258 158,778 276,973 447,009

Plant and equipment 107,316 134,428 124,466 366,210

Total non current assets 118,574 311,883 401,439 831,896

Total assets 519,686 1,041,993 2,750,486 4,312,165

Current liabilities:

Trade creditors 119,873 200,602 30,326 350,801

Other creditors 636,174 146,297 953,674 1,736,145

Total current liabilities 756,047 346,899 984,000 2,086,946

Total liabilities 756,047 346,899 984,000 2,086,946

Net assets (236,361) 695,094 1,766,486 2,225,219

Goodwill on acquisition 558,827 3,860,897 10,451,937 14,871,661

Total 322,466 4,555,991 12,218,423 17,096,880


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NOTE 25: DISCOUNTINUED OPERATIONS

On 30 June 2008, Q Ltd terminated the business (Axis Media Communications Pty Ltd) which was involved in the provision of

digital advertising services to mobile telecommunications users. This decision was taken in light of broader market conditions and

the likelihood that this market would grow at an acceptable rate in the short to medium term time horizon. There were no material

expenses incurred in the 2009 fi nancial relating to the discontinued business.

Consolidated

2009 2008

$ $

Loss from discontinued operations:

Revenue from rendering of services (note 2) - 243,015

- 243,015

Expenses

Employee benefi t - (710,483)

Depreciation expense - (7,339)

Other expenses - (372,179)

- (1,090,001)

Loss before tax - (846,986)

Attributable income tax expense - 235,252

- (611,734)

Loss on disposal of operation - (769,351)

Loss for the year from discontinued operations - (1,381,085)

Cash fl ows from discontinued operations:

Net cash fl ows from operating activities (200,000) (720,354)

Net cash fl ows from investing activities - (2,115)

Net cash fl ows from fi nancing activities - 711,920

Net cash fl ows (200,000) (10,549)


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NOTE 26: SEGMENT REPORTING

Primary reporting — Business segments

Mobile Advertising

(discontinued)Digital Marketing

(continuing operations)

2009 2008 2009 2008

$ $ $ $

REVENUE

Total sales - 243,015 27,117,293 26,099,169

Other revenue - - 177,097 223,489

Total Segment revenue - 243,015 27,294,390 26,185,939

RESULT

Profi t/(Loss) from ordinary activities before income tax benefi t - (1,616,337) 774,064 530,263

Income tax benefi t - 235,252 (389,160) 76,245

Profi t/(Loss) from ordinary activities after income tax - (1,381,085) 384,904 606,508

ASSETS

Segment assets - 15,674 40,365,213 35,335,737

Total assets - 15,674 40,365,213 35,335,737

LIABILITIES

Segment liabilities - 310,237 11,897,882 9,505,241

Unallocated liabilities - - - -

Total liabilities - 310,237 11,897,882 9,505,241

Net Asset - (294,563) 28,467,331 25,830,496

Acquisition of segment assets - - 274,463 946,586

Depreciation - 7,339 310,707 389,660


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NOTE 26: SEGMENT REPORTING (Cont.)

Accounting Policies

Segment revenues and expenses are those directly attributable to the segments and include any joint revenue and expenses where a reasonable basis of allocation exists.

Segment assets include all assets used by a segment and consist principally of cash, receivables, inventories, intangibles and property, plant and equipment, net of allowances and accumulated depreciation and amortisation. While most such assets can be directly attributed to individual segments, the carrying amount of certain assets used jointly by two or more segments is allocated to the segments on a reasonable basis. Segment liabilities consist principally of accounts payable, employee entitlements, accrued expenses, provisions and borrowings. Segment assets and liabilities do not include deferred income taxes.

Intersegment Transfers:

There were no intersegment transfers.

Business and Geographical Segments

Business Segments:

The Consolidated Entity operated in the digital marketing space for the year ended 30 June 2009.

Geographical Segments:

The Group has business segments located in Australia and New Zealand. The revenue contributed and assets purchased as below:

Segment revenuesCarrying amounts of net

segment assetsAcquisition of Non-

current segment assets

Geographical location

2009 2008 2009 2008 2009 2008

$ $ $ $ $ $

Australia 22,923,043 20,497,022 27,679,240 25,539,756 272,335 934,162

New Zealand 4,371,347 5,825,636 788,091 290,740 2,128 12,424

Total 27,294,390 26,322,658 28,467,331 25,830,496 274,463 946,586


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NOTE 27: EMPLOYEE OPTION PLAN

Q Ltd operates an employee option plan called the Q Ltd Incentive Option Scheme (“Scheme”). The Scheme is designed to provide a long-term incentive for employees and Directors of Q Ltd. It will allow them to participate in Q Ltd’s future growth and give them an incentive to increase profi tability and returns to shareholders. Full time employees, part-time employees, Directors and contractors of Q Ltd are eligible to participate in the Scheme. Notwithstanding their eligibility to participate, the Directors have elected not to do so and instead submit recommendations for the grant of options for shareholder approval. The entitlement of eligible participants under the Scheme is at the absolute discretion of the Directors.

The exercise price of each option offered pursuant to the scheme is at the discretion of the Directors.

The total number of Options, which may be issued under the Scheme may not exceed 5% of the total number of issued shares in Q Ltd as at the time of the proposed offer or issue. The Options hold no voting or dividend rights, and are not transferable.

There were no options issued under this Scheme to employees during the fi nancial year. A 100:1 capital reconstruction was approved in October 2008. 26,250 (post consolidation) options were forfeited during the year leaving 268,500 options on issue as at 30 June 2009.

The closing share market price of an ordinary share of Q Ltd on the Australian Stock Exchange at 30th June 2009 was $0.11.


2009No.

2008No.

2009No.

2008No.

a. Movement in the number of share options held by Directors are as follows:

Opening balance 6,833,334 7,500,000 6,833,334 7,500,000

Granted during the year - - - -

Exercised during the year (666,666) - (666,666)

Forfeited (333,334) - (333,334) -

Lapsed during the year - - - -

Capital reconstruction 100:1 (6,435,000) - (6,435,000) -

Closing Balance 65,000 6,833,334 65,000 6,833,334

Movement in the number of share options held by employees, former employees, consultants and former Directors are as follows:

Opening balance 22,975,000 7,125,000 22,975,000 7,125,000

Granted during the year - 19,800,000 - 19,800,000

Lapsed during the year - - - -

Exercised during the year - (500,000) - (500,000)

Forfeited during the year (2,625,000) (3,450,000) (2,625,000) (3,450,000)

100:1 capital reconstruction (20,146,500) - (20,146,500) -

Closing Balance 203,500 22,975,000 203,500 22,975,000

Closing balance 268,500 29,808,334 268,500 29,808,334


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NOTE 27: EMPLOYEE OPTION PLAN (Cont.)b. Details of share options held by Directors as at end of year

DirectorsGrantDate

ExpiryDate

Vestingdate

Exercise Price ($)

Balance 01.07.08

Options Granted

Options Exercised

Options Expired

Options forfeited

Capital recon-

struction

TotalBalance 30.06.09

No. No. No. No. No. 100:1 No.

Mr K V Campbell 30/11/2006 30/09/2010 30/09/2007 2.68 500,000 - - - - (495,000) 5,000

Mr PG Choiselat 30/11/2006 30/09/2010 30/09/2007 2.68 500,000 - - - - (495,000) 5,000

Mr A H S Koo 30/11/2006 30/09/2010 30/09/2007 2.68 500,000 - - - - (495,000) 5,000

Hon J G Kennett 30/11/2006 30/09/2010 30/09/2007 2.68 333,333 - - - - (330,000) 3,333

Mr B R Bennie 30/11/2006 30/09/2011 30/09/2008 2.90 333,333 - - - - (330,000) 3,333

Mr K V Campbell 30/11/2006 30/09/2011 30/09/2008 2.90 500,000 - - - - (495,000) 5,000

Mr PG Choiselat 30/11/2006 30/09/2011 30/09/2008 2.90 500,000 - - - - (495,000) 5,000

Mr M Halstead 30/11/2006 30/09/2011 30/09/2008 2.90 333,333 - - - - (330,000) 3,333

Mr A H S Koo 30/11/2006 30/09/2011 30/09/2008 2.90 500,000 - - - - (495,000) 5,000

Hon J G Kennett 30/11/2006 30/09/2011 30/09/2008 2.90 333,333 - - - - (330,000) 3,333

Mr B R Bennie 30/11/2006 30/09/2012 30/09/2009 3.12 333,334 - - - - (330,001) 3,333

Mr K V Campbell 30/11/2006 30/09/2012 30/09/2009 3.12 500,000 - - - - (495,000) 5,000

Mr PG Choiselat 30/11/2006 30/09/2012 30/09/2009 3.12 500,000 - - - - (495,000) 5,000

Mr M Halstead 30/11/2006 30/09/2012 30/09/2009 3.12 333,334 - - - - (330,001) 3,333

Mr A H S Koo 30/11/2006 30/09/2012 30/09/2009 3.12 500,000 - - - - (495,000) 5,000

Hon J G Kennett 30/11/2006 30/09/2012 30/09/2009 3.12 333,334 - - - (333,334) - -

Total 6,833,334 - - - (333,334) (6,435,000) 65,000


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NOTE 27: EMPLOYEE OPTION PLAN (Cont.)Details of share options held by employees, former employees, consultants and former Directors outstanding as at end of year

EmployeesGrant Date

Expiry Date

Vesting date

Exercise Price

(dollars)

Balance 01.07.08

Options Forfeited

Capital recon-

struction

Total Balance 30.06.09

No. No. 100:1 No.

Series 1 25/09/2006 30/09/2010 30/09/2007 2.68 1,875,000 - (1,856,250) 18,750

Series 2 25/09/2006 30/09/2011 30/09/2008 2.9 2,375,000 - (2,351,250) 23,750

Series 3 25/09/2006 30/09/2012 30/09/2009 3.12 2,375,000 - (2,351,250) 23,750

Series 4 31/01/2008 30/03/2012 30/03/2009 4.31 5,450,000 (875,000) (4,529,250) 45,750

Series 5 31/01/2008 30/03/2013 30/03/2010 4.67 5,450,000 (875,000) (4,529,250) 45,750

Series 6 31/01/2008 30/03/2014 30/03/2011 5.03 5,450,000 (875,000) (4,529,250) 45,750

Total 22,975,000 (2,625,000) (20,146,500) 203,500

The options were forfeited due to employees not satisfying one of the vesting conditions whereby the option holder must be an employee on vesting date of the option.

The Consolidated Entity and the Company have obtained a third party valuation whereby the value of the options were calculated using the Black-Scholes Option Pricing Model, which takes account of factors including the options exercise price, the current level and volatility of the underlying share price, the risk free interest rate, expected dividends on the underlying share, current market price on the underlying share and expected life of the options

Option series

Inputs into the model Series 1 Series 2 Series 3 Series 4 Series 5 Series 6

Grant date 25/09/2006 25/09/2006 25/09/2006 31/01/2008 31/01/2008 31/01/2008

Exercise price (cents) 2.68 2.90 3.12 4.31 4.67 5.03

Expected volatility (%) 79.7 79.7 79.7 78.0 78.0 78.0

Option life (years) 4 4 4 3 3 3

Dividend yield - - - - - -

Risk-free interest rate 5.62 5.62 5.62 6.54 6.54 6.54

Conditions of the options:

Each option will convert into 1 ordinary share. The vesting of the options will occur in three tranches according to the vesting date in the above table. Options may be exercise before the expiry date on or after the vesting date for each series. The option holder must be an employee of employed by the Company on vesting date to satisfy the vesting conditions for the options issued under the Scheme.


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NOTE 27: EMPLOYEE OPTION PLAN (Cont.)

The following reconciles the outstanding share options granted under the employee share options plan at the beginning and end of the fi nancial year:

2009 2008

Number of options

Weighted average exercise price $

Number of options

Weighted average exercise price $

Balance at beginning of fi nancial year 22,975,000 4.13 7,125,000 2.90

Granted during fi nancial year - 19,800,000 4.67

Forfeited during the fi nancial year (2,625,000) 4.67 (3,450,000) 4.67

Exercised during the fi nancial year (i) - (500,000) 2.90

Capital reconstruction 100:1 (20,146,500) -

Balance at end of fi nancial year 203,500 4.10 22,975,000 1.43

(i) Exercised during the fi nancial year

There were no options exercised during the fi nancial year.

NOTE 28: EVENTS SUBSEQUENT TO REPORTING DATE

There has not arisen in the interval between the end of the reporting period and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors of the Company, to affect signifi cantly the operations of the Company, the results of those operations, or the state of affairs of the Company in future fi nancial years other than a fully underwritten 7 for 5 non-renounceable rights issue which opened on 8 July 2009 and closed on 7 August 2009 to raise approximately $1.21M before costs.


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NOTE 29: RELATED PARTY

Equity interests in subsidiaries

Q Ltd owns 100% of ordinary shares in all its subsidiaries (refer Note 23).

Key Management Personnel equity holdings and share options in Q LtdRefer Note 6 Key Management Personnel Compensation


2009$

2008$

2009$

2008$

TRANSACTIONS

Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated.

Transactions with related parties:

i. Director-related Entities

Total administration services fees, facilities fees and occupancy fees charged by Beconwood Securities Pty Ltd, a Company associated with Paul G Choiselat. The outstanding balance is $56,294. 412,322 1,494,512 412,322 1,494,512

Placement and underwriting fees paid to Beconwood Securities Pty Ltd in the fi nancial year - 591,107 - 591,107

ii. Share Transactions of Directors

Directors and director-related entities hold directly, indirectly or benefi cially as at the reporting date the following equity interests in members of the economic entity:

— ordinary shares 6,987,283 87,873,937 6,987,283 87,873,937

— options over ordinary shares 65,000 6,833,334 65,000 6,833,334


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NOTE 30: FINANCIAL INSTRUMENTS

(a) Capital risk managementThe Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance.

The Group’s overall strategy remains unchanged from the annual report lodged for the fi nancial year end 30 June 2008.The capital structure of the Group includes unused bank facilities disclosed in note 22. The capital structure also includes equity attributable to equity holders of the Company, comprising issued capital, reserves and retained earnings as disclosed in notes 19 and 20 respectively. The Group operates in Australia and New Zealand, primarily through subsidiary companies established in the markets in which the Group trades. None of the Group’s entities are subject to externally imposed capital requirements.The current facilities available are the commercial bill facility and the overdraft facility indicated in notes 17 and 22.

Gearing ratioThe Group’s management and Directors monitor the capital structure on a monthly basis. The gearing ratio at year end was as follows:


(a) Capital risk management2009

$2008

$2009

$2008

$

Financial assets

Borrowings 17 279,638 49,981 250,000 -

Cash and cash equivalents 9 (2,429,496) (4,837,241) (135,145) (2,200,753)

Debts (i) (2,149,858) (4,787,260) 114,855 (2,200,753)

Equity (ii) 28,467,331 25,830,496 25,688,196 24,587,754

Net debt to equity ratio (%) - - 0.44 -

(i) Debt is defi ned as long and short-term borrowings, as detailed in Note 17. The borrowings from subsidiaries are not included for this purpose as the loans are just movements within the group for management of cash.

(ii) Equity includes all capital and reserves.


(b) Categories of fi nancial instruments2009

$2008

$2009

$2008

$

Financial assets

Fair value through profi t or loss (FVTPL): - - - -

Held-to-maturity investments - - - -

Cash and cash equivalents 9 2,429,496 4,837,241 135,145 2,200,753

Loans and receivables 10 5,020,518 5,429,737 2,706,241 1,956,106

Financial liabilities

Fair value through profi t or loss (FVTPL):

Amortised cost 15 & 17 11,429,830 9,065,873 12,885,813 6,752,940

Financial guarantee contracts - - - -


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NOTE 30: FINANCIAL INSTRUMENTS (Cont.)

(c) Financial risk management objectivesThe Group’s corporate treasury function provides services to the business, co-ordinates access to domestic and international fi nancial markets, monitors and manages the fi nancial risks relating to the operations of the Group through internal risk analysis by management on a regular basis including exposures by degree and magnitude of risks. These risks include market (including currency risk, fair value interest rate risk and price risk), credit risk, liquidity risk and cash fl ow interest rate risk.The Group does not enter into or trade fi nancial instruments, including derivative fi nancial instruments, for speculative purposes.

(d) Market riskThe Group’s activities expose it to the fi nancial risks of changes in foreign currency exchange rates and interest rates. The exposure is however minimal. The Group has not used part of its available debt facilities as listed in note 22. The Group’s overseas revenues are serviced by subsidiaries that are based in those countries therefore bringing its foreign currency exposure to just translation when converting to the Company currency for fi nancial reporting purposes and transactions that are intercompany. Due to the minimum exposure, the Group have not used any hedging instruments. The Group however, recognises that there is a foreign exchange risk with intercompany transactions and continue to monitor this carefully and will look into hedging instruments should there be a requirement in the future.

(e) Interest rate risk managementThe Group’s exposure to interest rate risk is limited to the movement in interest rate in terms of its cash held at bank as listed in note 9 and interest expense incurred on the use of the credit facilities as listed in note 22. $250,000 of facilities was utilised by the Group as at 30 June 2009.

Consolidated Company

Average interest rate (%) Income $Variance to

actual $ Income $Variance to

actual $

FY 2009

3.00 (actual) 130,528 56,058

3.50 (+ 0.5) 152,283 21,755 65,401 9,343

4.00 (+ 1.0) 174,037 43,509 74,744 18,686

4.50 (+1.5) 195,792 65,264 84,087 28,029

5.00 (+2.0) 217,547 87,019 93,430 37,372

2.50 (-0.5) 126,902 (21,755) 46,715 (9,343)

2.00 (-1.0 116,025 (43,609) 37,372 (18,686)

FY 2008

6.85 (actual) 223,489 136,719

7.35 (+ 0.5) 239,802 16,313 146,698 9,979

7.85 (+ 1.0) 256,115 32,626 156,678 19,959

6.35 (- 0.5) 207,176 (16,313) 126,740 (9,979)

5.85 (-1.0) 190,863 (32,626) 116,760 (19,959)

The above sensitivity analysis shows the amount of net interest decrease or increase depending on the rise or fall of interest rate.


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(f) Credit risk managementCredit risk refers to the risk that a counter party will default on its contractual obligations resulting in fi nancial loss to the Group. The Group adopted a policy of only dealing with reputable counterparties as means of mitigating the risk of fi nancial loss from defaults. The Group uses publicly available fi nancial information and its own trading record to rate its major customers. The Group’s exposure and the reputation of the counterparties are continuously monitored.

Trade receivables consist of a large number of customers and ongoing credit evaluation is performed on the accounts regularly. The Group does not have any signifi cant credit risk exposure to any single counterparty or any Group of counterparties which the exception of an isolated debtor (refer note 10). The carrying amount of fi nancial assets recorded in the fi nancial statements, net of any allowances for losses, represents the Group’s maximum exposure to credit risk.

(g) Liquidity risk managementUltimate responsibility for liquidity risk management rests with the board of Directors, who have built an appropriate liquidity risk management framework for the management of the Group’s short, medium and long-term funding and liquidity management requirements. The Group manages liquidity by maintaining adequate reserves, banking facilities and reserve borrowing facilities by continuously monitoring forecast and actual cash fl ows and matching the maturity profi les of fi nancial assets and liabilities. Included in note 22 is a listing of additional undrawn facilities that the Company/Group has at its disposal to further reduce liquidity risk.

Liquidity and interest risk table

The following table detail the Company’s and the Group’s remaining contractual maturity for its non derivative fi nancial liabilities. The Group does not have any derivative fi nancial liabilities.

Consolidated

Weighted ave effective interest rate

1-3 months $ 000

Within 1 year $000

1-5 years $000 Total

2009

Non - interest bearing operations 6,935,709 - - 6,935,709

Finance lease liability 8.8% 5,000 15,000 9,638 29,638

6,940,709 15,000 9,638 6,965,347

2008

Non - interest bearing 7,543,324 - - 7,543,324

Finance lease liability 8.8% 10,518 31,555 7,908 49,981

7,553,842 31,555 7,908 7,593,305


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Liquidity and interest risk table (Cont.)

Company

Weighted ave effective interest rate

1-3 months $ 000

Within 1 year $000

1-5 years $000 Total

2009


Finance lease liability 8.8% - - - -

4,868,968 - - 4,868,968

2008


Finance lease liability 8.8% - - - -

4,262,048 - - 4,262,048

The following table details the Company’s and the Group’s expected maturity for its non-derivative fi nancial assets. The tables below have been drawn up based on the undiscounted contractual maturities of the fi nancial assets including interest that will be earned on those assets except where the Company/Group anticipates that the cash fl ow will occur in a different period.

(h) Fair value of fi nancial instrumentsThe Directors consider that the carrying amount of fi nancial assets and fi nancial liabilities recorded in the fi nancial statements approximates their fair values.

NOTE 31: CONTINGENT LIABILITIES There are no contingent liabilities other than estimated payment of acquisitions.


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DIRECTORS’ DECLARATION

The Directors declare that:

a. In the Directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable;

b. In the Directors’ opinion, the attached fi nancial statements and notes thereto are in accordance with the Corporations Act 2001, including compliance with accounting standards and giving a true and fair view of the fi nancial position and performance of the Consolidated Entity; and

c. The Directors have been given the declarations required by s.295A of the Corporations Act 2001.

Signed in accordance with a resolution of the Directors made pursuant to s.295(5) of the Corporations Act 2001.

On behalf of the Directors.

P G Choiselat

MD/CEO

Dated this 14th day of September 2009


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INDEPENDENT AUDIT REPORT TO THE MEMBERS OF Q LTD – PAGE 1


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AUDITOR REPORT PAGE 2


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ADDITIONAL INVESTOR INFORMATION

Stock Exchange ListingQ Ltd is listed on ASX under the code QXQ for ordinary shares.

DistributionsNo distributions or dividends have been paid by Q Ltd for the year.

RegistryComputershare Investor Services Pty Limited is Q Ltd’s security register manager and holds all shareholder records electronically. Computershare is also responsible for the maintenance of shareholder records and the preparation of distribution payments, if any. Contact details for Computershare are set out on the inside back cover.

Investor SupportIf you have any queries regarding your investment, please contact Computershare toll free on 1300 850 505 or visit their website at www.computershare.com.au. Please note there is a section of the website designed to provide shareholders with the forms necessary to initiate changes of the details held at the registry. This service is available from 8.30am to 5.30pm (Melbourne time) on all business days. Enquiries may also be e-mailed to [email protected].

Requests for changes to your holding details, distribution payment details, or general enquires can all be directed to the Computershare Shareholder Service Centre.

Annual ReportAll shareholders are entitled to receive a copy of the Annual Report. If you do not require the Annual Report, or if you receive more copies than you require, please notify Computershare at the address shown on the last page of this report.

Annual General MeetingQ Ltd’s last Annual General Meeting was held on 30 October 2008. Shareholders approved a capital consolidation of 100:1, an issue of up to 2 million shares post consolidation, endorsed the re-appointment of Mr Campbell and Mr Choiselat as Directors, and ratifi ed the earlier issue of 8,960,822 shares.

The next Annual General Meeting will be held on Thursday 1 November 2009 at Level 5, Bank House, 11 Bank Place, Melbourne VIC 3000. The Notice of Meeting and Proxy Form are included with this Report.

As at the date of this Report, there are 268,500 options held over unissued shares. Refer to note 27 for details.

Distribution of Shareholders

Range at 31 August 2009 Fully paid ordinary shares Options

1 - 1,000 971 -

1,001 - 5,000 272 -

5,001 - 10,000 70 -

10001 - 100,000 160 -

100,001 and over 34 -

Total number of holders 1507 -

Holders of less than a marketable parcel 1227 -

Substantial Shareholders

Entity (and associated parties) Shares (1)

% Shareholding at time of SSN lodgement (2) Date last notice

Received by Company

Beconwood Securities Pty Ltd 6,333,418 25.84 11/09/2009 Yes

Aaron O ‘Sullivan 1,215,003 12.19 10/12/2008 Yes

Kennadell Pty Ltd 618,226 7.23 17/04/2009 Yes

Voting RightsUnder the Company’s Constitution, each member present at a general meeting is entitled:

on a show of hands, to one vote; and1. on a poll, to one vote for each share held or represented.2.

Options do not carry voting rights.


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STATEMENT OF SHAREHOLDERS

Q Ltd’s 20 largest ordinary shareholders and their holdings as at 11 September 2009:

ShareholderNumber of

shares %

BECONWOOD SUPERANNUATION PTY LTD 4,053,961 16.54

MR KENNETH WILLIAM BREESE + MRS JENNIFER RUTH BREESE <BPD EXECUTIVE SUPERFUND A/C> 1,311,317 5.35

MR AARON DANIEL O’SULLIVAN 1,172,003 4.78

REPYSA HOLDINGS INC 883,040 3.60

MR SEAN MICHAEL NUNAN 768,334 3.13

BECONWOOD SECURITIES PTY LTD 714,969 2.92

LAYUTI PTY LTD <THE MOUATT SUPER FUND A/C> 661,544 2.70

BUSINESS MENTORS INTERNATIONAL PTY LTD <WMS STAFF SUPER SCHEME A/C> 480,000 1.96

MR ANDREW FIORI-DEA + MS DIANA FIORI-DEA <FIORI-DEA SUPER FUND A/C> 455,338 1.86

TRS INVESTMENTS LTD 416,230 1.70

CRIMSON SKIES PTY LTD <RICHARD NOON FAMILY A/C> 362,000 1.48

ABSOFT GROUP PTY LTD 359,204 1.47

MR NICHOLAS KOTSIRAS + MRS ANGELA KOTSIRAS 303,360 1.24

BECONWOOD SECURITIES PTY LTD <NO 3 A/C> 300,000 1.22

MR RICHARD DEVIGNE 282,300 1.15

KENNADELL PTY LTD 280,542 1.14

LOCOPE PTY LTD 246,632 1.01

LUBEME SERVICES PTY LTD <DWYER SUPER FUND A/C> 242,800 0.99

RICHARD KUO + SAMANTHA MEERS 240,000 0.98

MULLOWAY PTY LTD <MIKE O’DONNELL S/F A/C> 235,399 0.96

Top 20 holders of ORDINARY SHARES (GROUPED) as at 11 September 2009 13,768,973 56.18

Balance of holders 10,743,969 43.82

Total on issue 24,512,942 100


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CORPORATE DIRECTORY

Listed Entities Comprising Q Ltd:ABN 13 083 160 909

ASX Listing Code:QXQ (ordinary shares)

Registered offi ce:Level 5, Bank House11 Bank PlaceMELBOURNE VIC 3000Telephone: 613 9691 4900Facsimile: 613 9600 1500

Places of Business:

Victoria, AustraliaSuite 1, 40-44 St Kilda RoadST KILDA VIC 3142Telephone: 613 8517 1400Facsimile: 613 9530 2905

New South Wales, AustraliaLevel 3, 4-16 Yurong StreetEAST SYDNEY NSW 2011Telephone: 612 9339 6787Facsimile: 612 9475 4364

Western Australia, AustraliaLevel 1, 1138 Hay StreetWEST PERTH WA 6005Telephone: 618 9322 3213Facsimilte: 618 9322 3106

Auckland, New ZealandLevel 4, Cathedral House48 Wyndham StreetAUCKLAND NEW ZEALANDTelephone: 64 (9) 920 1740Facsimile: 64 (9) 920 1741

Directors of Q Ltd:Kevin V Campbell AM - ChairmanPaul G Choiselat - MD/CEOAndrew HS Koo AM Mark HalsteadBruce R Bennie

MD/CEO of Q Ltd:Paul G ChoiselatEmail: [email protected]

Chairman of Q LtdKevin V CampbellEmail: [email protected]

CFO of Q Ltd:May A ChuahEmail: [email protected]

Company Secretary of Q Ltd (Joint):May A ChuahEmail: [email protected]

Cynthia ChanEmail: [email protected]

Share Registry:Computershare Investor Services Pty LimitedYarra Falls452 Johnston StreetABBOTSFORD VIC 3067Telephone: 1300 850 505Fax: 613 9473 2500www.computershare.com

Auditors of Q Ltd:Deloitte Touche Tohmatsu550 Bourke StreetQueen Victoria BuildingMELBOURNE VIC 3000


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GLOSSARY

3di 3 Dimension Interactive Pty Ltd (ACN 104 904 396)

A-IFRS Australian equivalents to International Financial Reporting Standards

ASX ASX Limited (ACN 008 624 691)

ASX BPR Best Practice Recommendations of ASX Principles of Good Corporate Governance

ASXCGPR ASX Corporate Governance Principles and Recommendations

Auditor auditor of Q Ltd, being Deloitte Touche Tohmatsu

Axis Media Axis Media Communications Pty Ltd (ACN 113 551 901)

Board Board of Directors of Q Ltd

CGU Cash Generating Unit

Company Q Ltd (ACN 083 160 909)

Consolidated Entity Q Ltd and its controlled entities

FY2008 fi nancial year ending 30 June 2008

FY2009 fi nancial year ending 30 June 2009

Group Q Ltd and its controlled entities

IFRS International Financial Reporting Standards

Market United Market United Pty Ltd (ACN 103 112 401)

Mosaic Mosaic Traffi c Pty Ltd (ACN 114 701 414)

Ordinary Shares ordinary shares in Q Ltd

pa per annum

Q Ltd Q Ltd (ACN 083 160 909)

Scheme Q Ltd Incentive Option Scheme

Year fi nancial year


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QLTD0001-AR2009-Cover.indd 1QLTD0001-AR2009-Cover.indd 1 24/9/09 10:27:32 AM24/9/09 10:27:32 AM

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