Datamatic Annual Report - EL CORPORATION · EL Corporation Limited and Controlled Entities ABN 41 002 737 733 - 2 - Chairman’s Report The directors of El Corporation Limited announce

E L C O R P O R A T I O N L I M I T E D

E L C O R P O R AT I O N L I M I T E D a n d C o n t r o l l e d E n t i t i e s

A S X C O D E : E I M

9 9 M o u n t S t r e e t , N o r t h S y d n e y , N S W 2 0 6 0 Au s t r a l i a

P h o n e : ( + 6 1 2 ) 9 9 2 2 4 2 7 8 F a x : ( + 6 1 2 ) 9 9 2 2 7 8 6 2

A N N U A L R E P O R T 2 0 12

EL Corporation Limited

and Controlled Entities

ABN 41 002 737 733

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CONTENTS

Chairman's Report 2

Corporate Governance Report 3

Directors' Report 7

Auditor’s Independence Declaration 10

Statement of Comprehensive Income 11

Statement of Financial Position 12

Statement of Changes in Equity 13

Statement of Cash Flows 14

Notes to the Financial Statements 15

Directors’ Declaration 27

Independent Auditor's Report 28

Shareholders' Statistics 30

Directors Sim Pin Quek Poh Seng Isaac Ng Rajen Rai Chairman CEO Non-executive Director Mark Roy Howard-Browne Hee Kok Chng Non-executive Director Non-executive Director

Secretary

Tom Bloomfield

Registered Office Auditor Share Register

c/- Boardroom Pty Ltd RSM Bird Cameron Partners c/- Boardroom Pty Ltd Level 7, 207 Kent Street, Level 12, 60 Castlereagh Street, Level 7, 207 Kent Street, Sydney NSW 2000 Sydney NSW 2000 Sydney NSW 2000

Tel: (02) 9290-9617 Tel: (02) 9233-8933 Tel: (02) 9290-9617

Fax: (02) 9279-0664 Fax: (02) 9233-8521 Fax: (02) 9279-0664

Stock Exchange Listing

EL Corporation Limited’s shares are listed on the Australian Stock Exchange.


ABN 41 002 737 733 Annual General Meeting

The Annual General Meeting of EL Corporation Limited will be held in the Board Room

at Raffles College, 99 Mount Street, North Sydney on Friday 31st May 2013, at 3.00 pm where this report will be presented.



ABN 41 002 737 733

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Chairman’s Report The directors of El Corporation Limited announce a loss after income tax of $423,152 for the year ending 31st December 2012 compared to a loss of $148,554 for the same period in 2011. Material items affecting the result included the following: 2012

$ 2011

$

% Revenues – other 12 379 (97) Loss before tax (423,152) (148,554) (185) Loss after tax (423,152) (148,554) (185)

On or about 21 September 2012, the agreement to acquire the Birthday Mine was terminated as a result of the non-satisfaction of a key condition precedent. Pursuant to the terms of the agreement, the deposit of $750,000 was repayable by the Vendor, Steven Shilkin, within 3 business days of the date the condition precedent became incapable of satisfaction. However as the Vendor failed to repay the deposit within the stipulated time frame, the Company commenced proceedings in the Supreme Court of Western Australia against the Vendor seeking repayment of the deposit. On 12th March 2013, EL Corporation Limited entered into a settlement agreement with Steven Shilkin and Summit Light Ventures Ltd whereby Summit Light Ventures Ltd entered into a written

agreement with Steven Shilkin to purchase the assets and settle the $750,000 owing by Steven Shilkin to EL Corporation Ltd on 20th March 2013. However, Summit Light Ventures Ltd had a delay in their settlement with Steven Shilkin. The Company has been advised that the completion will be scheduled for end April 2013. The Taiwan Joint Venture, Max Media Pte Ltd, has been deregistered during the year as disclosed in our last report. We are also pleased to advise that Atlas Capital Pte Ltd will continue to fund our operations and they have provided a letter of support to that effect. No dividend was paid or recommended during the financial year.

Sim Pin Quek Chairman



ABN 41 002 737 733

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CORPORATE GOVERNANCE

Introduction We would like to affirm that the company has sufficient cash to fund its ongoing activities. We have advised all our shareholders that funding will continue to be provided from Atlas Capital Pte Ltd. The company's administrative function is largely provided on an outsourced basis in order to minimise cost. The company's corporate governance statement should be read in the context of the company's present operating state.

Principle 1 Lay solid foundations for management and oversight

Recommendation 1.1 Companies should establish the functions reserved to the board and those delegated to senior executives and disclose those functions. Only one executive is employed by the company, Mr. Isaac Ng, who is also the Chief Executive Officer. All other functions such as financial management and corporate secretarial are provided to the company on an outsourced basis. The company's operations were in Taiwan where the company's joint-venture partner is responsible for trialling, rollout and installation of cable television in apartments. It is the intention of the directors to wind down these operations and deregister the company in the foreseeable future. Recommendation 1.2. Companies should disclose the process for evaluating the performance of senior executives.

The Board of Directors will review the performance of the Senior Executives.

Principle 2 Structure of the board to add value

Recommendation 2.1 A majority of the board should be independent directors. The company complies with this recommendation. Recommendation 2.2 The chair should be an independent director. The present size of the company does not include the appointment of an independent director as chairman. Recommendation 2.3 The roles of chairman and chief executive officer should not be exercised by the same individual.

Mr. S P Quek continues in the role as Chairman and Mr. Isaac Ng was re-appointed the Chief Executive Officer on 14th February 2012. Recommendation 2.4 The board should establish a nomination committee. Appointment of such committee will be addressed when the board and staffing is expanded. Recommendation 2.5 Companies should disclose the process for evaluating the performance of the board, its committees and individual directors. The process for evaluating the performance will be disclosed to all. Recommendation 2.6 Companies should provide the information indicated in the guide to reporting on Principle 2.



ABN 41 002 737 733

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Mr. Rajen Rai, Mr. Mark Howard-Browne and Mr. Hee Kok Chng are all independent directors on the board. A substantial shareholder, or a representative thereof or an executive is not considered to be independent. Mr. Isaac Ng is not considered independent as he is the executive director of the company. Directors have been in office since the date indicated below:

Mr. Sim Pin Quek was appointed a director on 3rd September 2002. Mr. Rajan Rai was appointed a director on 14th March 2002. Mr. Isaac Ng was appointed a director on 14th December 2007. Mr. Mark Howard-Browne was appointed a director on 29th November 2010. Mr. Hee Kok Chng was appointed a director on 14th February 2012.

Principle 3 Promote ethical and responsible decision-making.

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

the practices necessary to maintain confidence in the company's integrity; the practices necessary to take into account of their legal obligations under reasonable

expectations of their stakeholders; and the responsibility and accountability of individuals for reporting and investigating

reports of unethical practices Recommendation 3.2 Companies should establish a policy concerning trading in Company securities. The company has a share trading policy which is as follows:

The directors and employees of the company are not permitted to deal in shares of the company in the period between the end of the financial half or full year until the release of the financial information for that period. Directors and employees of the company are prohibited from dealings in the company's shares at any time whilst in possession of price sensitive information. Recommendation 3.3 Companies should provide the information indicated in the guide to reporting on principle 3. The company's website will be launched at an appropriate time and the corporate governance material including the code of conduct and trading policy will be included in an Investor section on the website.

Principle 4 Safeguard the integrity in financial reporting

Recommendation 4.1 The board should establish an audit committee. The board currently comprises four members and will form an audit committee when the board and staffing is expanded. Recommendation 4.2 The audit committee should be structured according to the ASX corporate governance principles and recommendations. Not applicable Recommendation 4.3 The audit committee should have a formal charter. Not applicable.



ABN 41 002 737 733

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Recommendation 4.4 Companies should provide information indicated in the guide to reporting on Principle 4. Not applicable.

Principle 5 Make timely and balanced disclosure

Recommendation 5.1 Companies should establish written policies designed to ensure compliance with ASX listing rule disclosure requirements and to ensure accountability at a senior executive level that complies and disclose those policies or a summary of those policies. A summary of a policy follows: The company will comply with a continuous disclosure requirements set out in chapter 3 of the ASX

is listing rules. The board of directors, employees and consultants of the Company are required to adhere to the procedure set out this policy document to ensure compliance with this listing rule. In conjunction with this policy reference should be made to EL Corporation’s Market Disclosure Protocol and Share Trading policy. Copies of these policies will be posted on the company's website. Recommendation 5.2 Companies should provide information indicated in the Guide to reporting on principle 5. The company has set out in detail in this report the extent of its compliance with the recommendations set out in the ASX corporate governance guidelines. Principle 6 Respect the rights of shareholders

Recommendation 6.1 Companies should design a communications policy of promoting effective communication with shareholders and encouraging their participation in general meetings and

disclose the policy or a summary of that policy. The board of EL Corporation Limited respects the rights of shareholders and will improve its electronic shareholder communication in the company's development. Recommendation 6.2 Companies should provide the information indicated in regard to reporting on Principle 6. The company is rebuilding the business and has provided all the information to the ASX as it develops, in all the reporting requirements. Principle 7 Recognise and manage risk Recommendation 7.1 Company should establish policies for the oversight management of material business risks and discloses some of those policies.

New policies will be established to manage the risks associated with the Birthday Mine once the transaction is complete. Recommendation 7.2 The board should require management to design and implement a risk management and internal control system to manage the company's material business risks and report on whether those risks are being managed effectively. The board should disclose that management has reported as to the effectiveness of the company's management of its material risks. The Board will establish a committee to set the policy on a risk management and internal control system when the board and staffing have been expanded. This committee will identify specific risk factors, and design, implement and monitor a risk management and internal control system.



ABN 41 002 737 733

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Recommendation 7.3 The board should disclose whether it has received assurance from the Chief Executive officer and the Chief Financial Officer that the declaration provided in accordance with section 295A of the Corporations Act is founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to financial reporting risks. Both the Chief Executive Officer and the person in an equivalent position to the Chief Financial Officer will sign off to the board that these systems of risk management and internal control are adequate and appropriate for the size of the business.

Principle 8 Remunerate fairly and responsibly

Recommendation 8.1 The board should establish a remuneration committee.

A remuneration committee will be formed when the board and staffing have been expanded.

DIRECTORS’ REPORT

Your directors present their report on the company and its controlled entities for the financial year ended 31 December 2012. Directors The names of directors in office at any time during or since the end of the year are: Sim Pin Quek Rajen Rai Mark Howard-Browne Hee Kok Chng

Isaac Ng Directors have been in office since the start of the financial year to the date of this report unless otherwise stated. Company Secretary Nicholas Geddes held the position of company secretary until his resignation on 6 March 2012. Tom Bloomfield was appointed company secretary on 6 March 2012. Principal Activities The principal activities of the consolidated group during the financial year were: Import, design, sales, service and support of computer and communication systems and equipment; Provision of information technology, education, systems design; integration and development; consultancy services. The activities were changed at the annual general meeting held on 31st May 2012, with shareholders’ approval to include mining and exploration activities in connection with the intended acquisition of the Birthday Mine. There were no other significant changes in the nature of the consolidated group’s principal activities during the financial year. Operating Results The consolidated loss of the consolidated group after providing for income tax amounted to $423,152 (2011: loss $148,554). Dividends Paid or Recommended No dividend was paid or recommended during the financial year. Review of Operations During the year ended 31 December 2012 the group incurred a loss of $423,152 (2011: loss $148,554). Financial Position The net assets of the consolidated group have increased by $714,956 from 30 June 2011 to $181,643 in 2012. This increase is largely due to the following factors: - proceeds from share issues raising $1,136,500; and - operating loss for the period of $423,152 Significant Changes in the State of Affairs On or about 21 September 2012, the agreement to acquire the Birthday Mine was terminated as a result of the non-satisfaction of a key condition precedent. Pursuant to the terms of the agreement, the deposit of $750,000 was repayable by the Vendor, Steven Shilkin, within 3 business days of the date the condition precedent became incapable of satisfaction. However as the Vendor failed to repay the deposit within the stipulated time frame, the Company has commenced proceedings in the Supreme Court of Western Australia against the Vendor seeking repayment of the deposit. On 12th March 2013, the Company entered into a settlement agreement with Steven Shilkin and Summit Light Ventures Ltd whereby Summit Light Ventures Ltd entered into a written agreement with Steven Shilkin to purchase the assets and settle the $750,000 deposit owing by Steven Shilkin to the Company on 20th March 2013, however, Summit Light Ventures Ltd had a delay in their settlement with Steven Shilkin. The Company has been advised that the completion will be scheduled for end April 2013. At the same time, the Company continues to explore alternative and possible business partnerships that are in line with its business objectives. The Company has begun discussions with potential business partners to assess the viability of working with them to investing in projects relating to tourism, property development and resources industry within and outside of Australia. As the Company is still in the early stages of discussions, all possible options are being weighed and considered carefully with the best interest of the stakeholders in mind. The Taiwan Joint Venture in internet technology has been terminated in accordance with our previous announcements. We are also pleased to advise that Atlas Capital Pte Ltd will continue to fund our operations and they have provided a letter of support to that effect. Dividends Paid or Recommended No dividend was paid or recommended during the financial year. After balance date events The deposit of $750,000 for the acquisition was to have been refunded on 20th March 2013, however, Summit Light Ventures Ltd had a delay in their settlement with Steven Shilkin. The Company has been advised that the completion will be scheduled for end April 2013. Future Developments, Prospects and Business Strategies In the opinion of the directors it would prejudice the company's interests if any information on likely developments in the operations of the economic entity and the expected results of operations were included in this report, and the omission of such information is hereby disclosed.

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DIRECTORS’ REPORT

Environmental Issues The consolidated group’s operations are subject to significant environmental regulation under the law of the Commonwealth and State. The consolidated group has not incurred any liability under any environmental legislation. Information on Directors Sim Pin Quek Qualifications - Bachelor of Business Administration (Honours), Associated Member of the Chartered

Insurance Institute (London) Experience - Over 25 years’ experience as Executive Chairman of China Auto Corporation Ltd Interest in shares and Options - Nil Special Responsibilities - Chairman Directorship held in other listed entities - China Auto Corporation Ltd (A company listed on the Singapore Stock Exchange) Rajen Rai Qualifications - Fellow of the Association of Chartered Certified Accountants (UK) and Certified Public

Accountant Experience - 9 years’ experience as Finance Director followed by 16 years experience as Managing

Director of China Auto Corporation Ltd Interest in shares and Options - Nil Special Responsibilities - Non-executive Director Directorship held in other listed entities - China Auto Corporation Ltd (A company listed on the Singapore Stock Exchange) Mark Howard-Browne Qualifications - Member of the Australian Institute of Chartered Accountants Experience - Over 25 years’ experience in senior financial management positions in South Africa and

Australia Interest in shares and Options - Nil Special Responsibilities - Non-executive Director Directorship held in other listed entities - Nil Hee Kok Chng Qualifications - Bachelor of Engineering (Honours), MBA Experience - His experience is wide ranging having being CEO of the following public listed companies

on the Singapore stock exchange: Yeo Hiap Seng Ltd, Scotts Holdings Ltd, Hartawan Holdings Ltd, HG Metals Manufacturing Ltd and is currently the MD of Liang Huat Aluminium Ltd

Interest in shares and Options - Nil Special Responsibilities - Non-executive Director Directorship held in other listed entities - CHT (Holdings) Ltd, Full Apex (Holdings) Ltd, Chinasing Investment Holdings Ltd, Kuxking

Group Holdings Ltd, Liang Huat Aluminium Ltd, Pacific Century Regional Developments Ltd, People’s Food Holdings Ltd, Samudera Shipping Line Ltd, Sunray Holdings Ltd, Hartawan Holdings Ltd and Autovox Lorea Ltd (All companies are listed on the Singapore Stock Exchange)

Isaac Ng Qualifications - Master of Social Science (Australia), Diploma in Business Studies (Singapore)

Diploma in Chartered Marking (UK) Experience - Over 30 years’ experience in senior management positions, sales and marketing. Managed

and owned timber manufacturing facilities in Singapore and Malaysia. Ex CEO of Devon Industries Ltd (New Zealand) and current CEO of Raffles College of Design and Commerce, Australia.

Interest in shares and Options - 1,750,000 Shares in the Company Special Responsibilities - Executive Director Directorship held in other listed entities - Nil REMUNERATION REPORT This report details the nature and amount of remuneration for each key management person of EL Corporation Limited, and for the executives receiving the highest remuneration. Remuneration policy The board of studies objective is to: Reward executive officers with financial incentives linked to business unit performance, which in turn will increase shareholder value. Provide base salaries to attract and retain key executives who are critical to the Company’s long-term success by providing a secure level if income that recognises the market value of the position as well as internal between roles, the individual’s performance and experience. Generally, increases in the base pay only occur in response to market changes or when warranted by an executive’s change in responsibilities. Executive Directors and Senior Directors The Company has designed its executive compensation programs to reward performance based on business unit performance results for which they are responsible and which differentiates the composition of compensation into to two types: base salary and annual performance bonus. The program is administrated by the Board, which includes three non-executive directors. The Board takes into account the recommendations of Executive Directors with respect to the compensation of the group’s key executives. Non-Executive Directors Non-Executive Directors are remunerated by fees determined by the Board. In setting Directors’ fees, account is taken of the responsibilities inherent on the stewardship of the company and the demands made of Directors in the discharge of their responsibilities. Active is taken from industry sources to ensure remuneration accords with market place.

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DIRECTORS’ REPORT

Company performance, shareholder wealth and director and executive remuneration The remuneration policy has been tailored to increase goal congruence between shareholders, directors and executives. The method applied in achieving this aim will be performance based unit profitability as the Company currently does not have an active business unit.

Short-term benefits

Salary and commissions

Non-cash Benefit

Other Superannuation Total

2012 $ $ $ $ $ Key management Personnel Isaac Ng 30,000 1,500 - 2,700 34,200 30,000 1,500 - 2,700 34,200 Shares issued as part of remuneration for the year ended 31 December 2012 No options are issued to directors and executives as part of their remuneration. Meetings of Directors The Board did not formally meet during the financial year. The directors of the company, who reside in Singapore and Sydney, frequently communicate on all operational and financial matters by phone and email and where appropriate, formally resolved matters by the way of circular resolution. Indemnifying Officers or Auditor The Company has not, during or since the financial year, in respect of any person who is or had been an officer or auditor of the company or a related body corporate indemnified or made any relevant agreement for indemnifying against a liability incurred as an officer, including costs and expenses in successfully defending legal proceedings, or paid or agreed to pay a premium in respect of a contract insuring against a liability incurred as an officer for the cost or expenses to defend legal proceedings. Options At the date of this report no options to shares in the company have been granted and there were no options outstanding at the end of the financial year. Proceedings on Behalf of Company On 3 October 2012, the Company commenced proceedings in the Supreme Court of Western Australia against the vendor of the Birthday Mine, Steve Shilkin, seeking repayment of the refundable deposit of $750,000. The case was settled out of court on 12 March 2013, following a Settlement Agreement signed by the Company with Steve Shilkin and Summit Light Ventures. Under the Agreement Summit Light Ventures Ltd agreed to pay the sum of AUD$750,000 in cash to the Company on the Settlement Date (20 March 2013) as full and final settlement of all claims and rights that the Company or the Vendor has or may have against each other arising out of the agreement to acquire the Birthday Mine. Insurance of Officers The directors of the company are not insured. Auditor The auditors RSM Bird Cameron Partners continue in office in accordance with section 327 of the Corporations Law. Non-audit Services The Board of Directors, is satisfied 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 satisfied that the services disclosed below did not compromise the external auditor’s independence for the following reasons: - all non-audit services are reviewed and approved by the Board of Directors prior to commencement to ensure they do not adversely affect the integrity and objectivity of the auditor; and - the nature of the services provided does not compromise the general principles relating to auditor independence in accordance with APES 110: Code of Ethics for Professional Accountants set by the Accounting Professional and Ethical Standards Board. The following fees for non-audit services were paid or payable to RSM Bird Cameron Partners during the year ended 31 December 2012: - Preparation of the Investigating Accountants Report $17,500 Auditor’s Independence Declaration The lead auditor’s independence declaration for the year ended 31 December 2012 has been received and can be found on page 10 of this report. This report is made in accordance with a resolution of the Board of Directors.

_________________________________ Sim Pin Quek Director Dated this 28th day of March 2013

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RSM Bird Cameron Partners

Level 12, 60 Castlereagh Street Sydney NSW 2000

GPO Box 5138 Sydney NSW 2001

T +61 2 9233 8933 F +61 2 9233 8521

10 Liability limited by a scheme approved under Professional Standards Legislation

Major Offices in: Perth, Sydney, Melbourne, Adelaide and Canberra ABN 36 965 185 036

RSM Bird Cameron Partners is a member of the RSM network. Each member of the RSM network is an independent accounting and advisory firm which practises in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.

AUDITOR’S INDEPENDENCE DECLARATION As lead auditor for the audit of the financial report of EL Corporation Limited for the year ended 31 December 2012, I declare that, to the best of my knowledge and belief, there have been no contraventions of:

(i) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and

(ii) any applicable code of professional conduct in relation to the audit.

RSM BIRD CAMERON PARTNERS

G N SHERWOOD

Partner

Sydney, NSW

Dated: 28 March 2013

EL Corporation Limited ABN 41 022 737 733

STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2012

Consolidated Group Parent Entity

Note 2012 2011 2012 2011

$ $ $ $

Revenue 2 12 379 12 379

Debt forgiveness expense 3 - - (2,821) (203,523)

Employee benefits expense (48,843) (39,008) (48,843) (39,008)

Depreciation and amortisation expense 3 (3,657) (3,656) (3,657) (3,656)

Other expenses (370,664) (106,269) (364,301) (107,824)

Loss before income tax (423,152) (148,554) (419,610) (353,632)

Income tax expense 4 - - - -

Loss from continuing operations (423,152) (148,554) (419,610) (353,632)

Loss from discontinued operations - - - -

Loss for the year (423,152) (148,554) (419,610) (353,632)

Other comprehensive income

Exchange differences on translating foreign controlled

entities

1,608 28 - -

Total comprehensive income for the year (421,544) (148,526) (419,610) (353,632)

Loss attributable to minority equity interest - - - -

Loss attributable to members of the parent entity (421,544) (148,526) (419,610) (353,632)

Overall Operations

Basic earnings per share (cents per share) 8 (1.29) (0.13)

Diluted earnings per share (cents per share) 8 (1.29) (0.13)

Continuing Operations

Basic earnings per share (cents per share) 8 (1.29) (0.13)

Diluted earnings per share (cents per share) 8 (1.29) (0.13)

The accompanying notes form part of these financial statements

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STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2012


Note 2012 2011 2012 2011

$ $ $ $

ASSETS

CURRENT ASSETS

Cash and cash equivalents 9 3,282 8,441 2,376 5,973

Trade and other receivables 10 750,000 650,000 750,000 650,000

TOTAL CURRENT ASSETS 753,282 658,441 752,376 655,973

NON-CURRENT ASSETS

Property, plant and equipment 12 5,352 9,009 5,352 9,009

Intangible assets 24 - - - -

TOTAL NON-CURRENT ASSETS 5,352 9,009 5,352 9,009

TOTAL ASSETS 758,634 667,450 757,728 664,982

CURRENT LIABILITIES

Trade and other payables 13 177,056 57,379 176,684 57,379

Financial liabilities 14 388,500 1,135,000 388,500 1,135,000

Short-term provisions 15 11,435 8,384 11,435 8,384

TOTAL CURRENT LIABILITIES 576,991 1,200,763 576,619 1,200,763

TOTAL LIABILITIES 576,991 1,200,763 576,619 1,200,763

NET ASSETS/(LIABILITIES) 181,643 (533,313) 181,109 (535,781)

EQUITY

Issued Capital 16 25,653,476 24,516,976 25,653,476 24,516,976

Reserves (4,649) (6,257) 5,000 5,000

Retained earnings (25,467,184) (25,190,301) (25,477,367) (25,057,757)

Parent interest 181,643 (679,582) 181,109 (535,781)

Non-controlling interest - 146,269 - -

TOTAL EQUITY 181,643 (533,313) 181,109 (535,781)


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STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2012

CONSOLIDATED GROUP

Note Share

Capital

Ordinary

Retained

Earnings

Foreign

Currency

Translation

Reserve

Forfeited

Share

Reserve

Non-

controlling

Interest

TOTAL

$ $ $ $ $ $

Balance at 1 January 2011 24,512,976 (25,041,747) (11,285) 5,000 146,269 (388,787)

Loss attributable to ordinary members of parent

entity

-

(148,554)

-

-

-

(148,554)

Shares issued during the year 4,000 - - - - 4,000

Adjustments from translation of foreign

controlled entities

-

-

28

-

-

28

Balance at 31 December 2011 24,516,976 (25,190,301) (11,257) 5,000 146,269 (533,313)


entity

-

(423,152)

-

-

-

(423,152)

Shares issued during the year 1,136,500 - - - - 1,136,500

Adjustments from translation of foreign

controlled entities

-

-

1,608

-

-

1,608

Derecognition of non-controlling interest of Max

Media Pte Ltd

- 146,269 - - (146,269) -

Balance at 31 December 2012 25,653,476 (25,467,184) (9,649) 5,000 - 181,643

PARENT ENTITY

Note Share

Capital

Ordinary

Retained

Earnings

Forfeited

Share

Reserve

TOTAL

$ $ $ $

Balance at 1 January 2011 24,512,976 (24,704,125) 5,000 (186,149)


entity

-

(353,632)

-

(353,632)

Shares issued during the year 4,000 - - 4,000

Balance at 31 December 2011 24,516,976 (25,057,757) 5,000 (535,781)


entity

-

(419,610)

-

(419,610)

Shares issued during the year 1,136,500 - - 1,136,500

Balance at 31 December 2012 25,653,476 (25,477,367) 5,000 181,109


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STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2012


Note 2012 2011 2012 2011

$ $ $ $

CASH FLOWS FROM OPERATING ACTIVITIES

Interest received 12 379 12 379

Payments to suppliers and employees (393,671) (787,021) (392,109) (787,116)

Net cash used in operating activities 19 (393,659) (786,642) (392,097) (786,737)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from borrowings 388,500 735,000 388,500 735,000

Net cash provided by financing activities 388,500 735,000 388,500 735,000

Net decrease in cash held (5,159) (51,642) (3,597) (51,737)

Cash at beginning of financial year 8,441 60,083 5,973 57,710

Cash at end of financial year 9 3,282 8,441 2,376 5,973


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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2012

Note 1 Statement of Significant Accounting Policies The financial report covers the consolidated group of EL Corporation Limited and controlled entities, and EL Corporation as an individual entity. EL Corporation Limited is a listed company, incorporated and domiciled in Australia. This financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. The Group is a for-profit entity for financial reporting purposes under Australian Accounting Standards. Basis of Preparation Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report containing relevant and reliable information about transactions, events and conditions to which they apply. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with the International Financial Reporting Standards. Material accounting policies adopted in the preparation of this financial report are presented below. They have been consistently applied unless otherwise stated. The financial statements have been prepared on an accruals basis and are based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities. (a)

Going Concern

The financial statements have been prepared on the going concern basis, which contemplates continuity of normal business activities and the realisation of assets and discharge of liabilities in the normal course of business. As disclosed in the financial statements, the company and consolidated entity incurred losses of $419,610 and $423,152 respectively and had net cash outflows from operating activities of $392,097 and $393,659 respectively for the year ended 31 December 2012. As at that date the company and consolidated entity had net current assets of $175,757 and $176,291 respectively and net assets of $181,109 and $181,643 respectively. The Directors believe that there are reasonable grounds to believe that the company and consolidated entity will be able to continue as going concerns, after consideration of the following factors: • As disclosed in Note 14, the balance of $1,135,000 reflected as financial liabilities at 31 December 2011 was converted to

share capital during the year at a share price of $0.05c per share. • Atlas Capital (Pte) (“Atlas”) is a major financier of EL Corporation Limited (“EL Corporation”). Atlas has confirmed that it is

its intention to provide continuing financial support to EL Corporation sufficient to allow it to meet its current and future financial obligations and to enable it to pay its debts as and when they become due.

• Atlas has confirmed that should cash reserves be insufficient for EL Corporation to meet its financial obligations as and

when they fall due over the next 12 months, Atlas will inject further funds as necessary. • The directors have considered expected future cashflow requirements, and have satisfied themselves that EL Corporation

has the financial resources available to meet those needs. • The company has the ability to continue to raise additional funds pursuant to the Corporations Act 2001. • The ability of the company and consolidated entity to further scale back certain parts of their activities that are non

essential so as to conserve cash. Accordingly, the Directors believe that the company and consolidated entity will be able to continue as going concerns and that it is appropriate to adopt the going concern basis in the preparation of the financial report.

(b) Principles of Consolidation A controlled entity is any entity over which EL Corporation Limited has the power to govern the financial and operating policies so

as to obtain benefits from its activities. In assessing the powers to govern, the existence and effect of holding actual and potential voting rights are considered.

A list of controlled entity is contained in Note 11 to the financial statements.

As at reporting date, the assets and liabilities of controlled entities have been incorporated into the consolidated financial statements as well as their results for the year then ended. Where controlled entities have entered (left) the consolidated group during the year, the operating results have been included (excluded) from the date the control was obtained (ceased).

All inter-group balances and transactions between entities of the consolidated group, including any unrealised profits or losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with those adopted by the parent entity.

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(c) Income Tax The income tax expense (revenue) for the year comprises current income tax expense (income) and deferred tax expense

(income).

Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using applicable income tax rates enacted, or substantially enacted, as at reporting date. Current tax liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.

Deferred income tax expense reflects the movements in deferred tax asset and deferred tax liability balances during the year as

well as unused tax losses. Current and deferred income tax expense (income) is charged or credited directly to equity instead of the profit and loss when the

tax relates to items that are credited or charged directly to equity. Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of assets and

liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where amounts have been fully expensed but future tax deductions are available. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.

Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset is

realised or the liability is settled, based on tax rates enacted or substantively enacted at reporting date. Their measurement also reflects the manner in which management expects to recover or settle the carrying amount of the related asset or liability.

Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is probable

that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised. When temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures, deferred tax

assets and liabilities are not recognised where the timing of the reversal of the temporary difference can be controlled and it is not probable that the reversal will occur in the foreseeable future.

Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net settlement

or simultaneous realisation and settlement of the respective assets and liability will occur. Deferred tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax assets and liabilities relate to income tax levied by the same taxation authority on either the same taxable authority on either the same taxable entity or different taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective assets and liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled.

Tax Consolidation

EL Corporation Limited and its wholly-owned Australian subsidiaries have not formed an income tax consolidated group under tax legislation.

(d) Property, Plant and Equipment Each class of property, plant and equipment is carried at cost or fair value as indicated, less, where applicable, any accumulated

depreciation and impairment losses.

Plant and Equipment Plant and equipment are measured on the cost basis. The carrying amount of plant and equipment is reviewed annually by

directors to ensure that it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the assets employed and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts.

The cost of fixed assets constructed within the consolidated group includes the cost of materials, direct labour, borrowing costs

and an appropriate proportion of fixed and variable overheads. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that the future economic benefits associated with the item will flow to the group and the cost of the item can be measured reliably. All other repairs and maintenance is charged to the statement of comprehensive income during the financial year in which they are incurred.

Depreciation The depreciable amount of all fixed assets including buildings and capitalised lease assets, but excluding freehold land, is

depreciated on a straight-line basis over the asset’s useful life to the consolidated group commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.

The depreciation rates used for each class of depreciable assets are: Class of Fixed Asset Depreciation Rate Plant and equipment 10-30% The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance date. An assets’ carrying

amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than the estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are

included in the statement of comprehensive income. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings.

(e) Leases and Hire Purchase Contracts Leases of fixed assets where substantially all the risks and benefits incidental to the ownership of the asset, but not the legal

ownership that is transferable to the entities in the consolidated group are classified as finance leases. Finance leases are capitalised by recording an asset and a liability at the lower of the amounts equal to the fair value of the leased property or the present value of the minimum lease payments, including any guaranteed residual values. Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the period.

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Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful lives or the lease term. Lease

payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged in the periods in which they are incurred. Lease incentives under operating leases are recognised as a liability and amortised on a straight-line basis over the life of the lease term.

(f) Financial Instruments Recognition Financial instruments are initially measured at costs on trade date, which includes trade costs, when the related contractual rights

or obligations exist. Subsequent to initial recognition these instruments are measured as set out below. Financial assets at fair value through profit or loss A financial asset is classified in this category if acquired principally for the purpose of selling in the short term or if so designated

by management and within the requirements of AASB139: Recognition and Measurement of Financial Instruments. Derivatives are also categorised as held for trading unless they are designated as hedges. Realised and unrealised gains and losses arising from changes in fair value of these assets are included in the statement of comprehensive income in the period in which they arise.

Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active

market and are stated at amortised cost using the effective interest rate method. Held-to-maturity investments These investments have fixed maturities and it is the group’s intention to hold these investments to maturity. Any held-to-

maturity investments held by the group are stated at amortised cost using the effective interest rate method. Available-for-sale financial assets Available –for-sale financial assets include any financial assets not included in the above categories. Available-for-sale financial

assets are reflected at fair value. Unrealised gains and losses arising from changes in fair value are taken directly to equity. Financial Liabilities Non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and

amortisation. Derivative Instruments The group has not utilised any derivatives during the year. Fair Value Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the

fair value for all unlisted securities, including recent arm’s length transactions, reference to similar instruments and option pricing models.

Impairment At each reporting date, the group assesses whether there us objective evidence that a financial instrument has been impaired. In

the case of available-for-sale financial instruments, a prolonged decline in the value of the instrument is considered to determine whether an impairment has arisen. Impairment losses are recognised in the statement of comprehensive income.

Financial guarantees Where material, financial guarantees are issues, which requires the issuer to make specific payments to reimburse the holder for

a loss it incurs because a specific debtor fails to make a payment when due, are recognised as a financial liability at fair value on initial recognition. The guarantee is subsequently measured at the higher of the best estimate of the obligation and the amount initially recognised less, when appropriate, cumulative amortisation id accordance with AASB 118: Revenue. When the entity gives guarantees in exchange for a fee, revenue is recognised under AASB 118. The fair value of financial guarantee contracts has been assessed using a probability weighted discounted cash flow approach. The probability has been based on:

- The likelihood of the guarantee party defaulting in a year period: - The proportion of the exposure that is not expected to be recovered due to the guarantee party defaulting; - The maximum loss exposed if the guarantee party were to default.

Derecognition Financial assets are derecognised when the contractual rights to receipt of cash flows expire or the asset is transferred to another party whereby the entity no longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised when the related obligations are discharged, cancelled or have expired. The difference between the carrying amount of the financial liability extinguished or transferred to another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss.

(g) Impairment of Assets At each reporting date, the group reviews the carrying value of its tangible and intangible assets to determine whether there us

any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the statement of comprehensive income. Impairment testing is performed annually for goodwill and intangible assets with indefinite lives. Where it is not possible to estimate the recoverable amount of an individual asset, the group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

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(h) Investments in Associates Investments in associate companies are recognised in the financial statements by applying the equity method of accounting. The

equity method of accounting recognises the group’s share if post acquisition reserves of associates.

(i) Foreign Currency Transactions and Balances Functional and presentation currency The functional currency of each of the group’s entities is measured using the currency of the primary economic environment in

which the entity operates. The consolidated financial statements are presented in Australian dollars which is the parent entity’s functional and presentation currency.

Transaction and Balances Foreign currency transactions are translated into functional currency using exchange rates prevailing at the date of the

transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined. Exchange differences arising on the translation of monetary items are recognised in the statement of comprehensive income, except where deferred in equity as a qualifying cash flow or net investment hedge. Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity; otherwise the exchange difference is recognised in the statement of comprehensive income.

Group Companies The financial results and position of foreign operations whose functional currency is different from the group’s presentation

currency are translated as follows:

- Assets and liabilities are translated at year-end exchange rates prevailing at the reporting date; - Income and expenses are translated at average exchange rates for the period; and - Retained earnings are translated at the exchange rates prevailing at the date of transaction. -

Exchange differences arising on translation of foreign operations are transferred directly to the group’s foreign currency translation reserve in the statement of financial position. These differences are recognised in the statement of comprehensive income in the period in which the operation is disposed.

(j)

Employee Benefits

Equity-settled compensation The group does not operate and share-based compensation plans. (k) Provisions Provisions are recognised when the group has a legal or constructive obligation, as a result of past events, for which it is probable

that an outflow of economic benefits will result and that the outflow can be reliably measured. (l) Cash and cash equivalents Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with

original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities on the statement of financial position.

(m) Revenue Revenue from the sale of goods is recognised at the point of delivery as this corresponds to the transfer of significant risks and

rewards of ownership of the goods and cessation of all involvement in those goods. Revenue from investment properties is recognised on an accrual basis or straight line basis in accordance with lease agreements. Dividend revenue is recognised when the right to receive a dividend has been established. Dividends received from associates and joint venture entities are accounted for in accordance with the equity method of accounting. Revenue from the rendering of services is recognised upon the delivery of services to the customers. All revenue is stated net of the amount of goods and services tax (GST).

(n) Borrowing Costs Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial

period of time to prepare for their intended use or sale, are added to the cost of those assets. , until such time as the assets are substantially ready for their intended use or sale. All other borrowing costs are recognised in income in the period in which they are incurred.

(o) Good and service Tax (GST) Revenue, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not

recoverable from the Australian Taxation Office. In these circumstances the ST us recognised as part of the cost of acquisition of the asset or as part of the item of the expense. Receivables and payables in the statement of financial position are shown inclusive of GST. Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

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(p) Comparative Figures When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the

current financial year. (q) Critical Accounting Estimates and Judgements The directors evaluate estimates and judgements incorporated into the financial reports based on historical knowledge and best

available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the group.

Key estimates – impairment The group assesses impairment at each reporting date by evaluating conditions specific to the group that may lead to impairment

of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Value-in-use calculations performed in assessing recoverable amounts incorporate a number of key estimates.

Key judgements - provision for impairment of other receivables Included in other receivables at the end of the reporting period is an amount receivable in relation to a refundable deposit for the acquisition of an investment amounting to $750,000. This amount is now past due date but the directors understand that the full amount of the deposit is likely to be recoverable in the near future, and therefore no provision for impairment has been made.

(r) New Accounting Standards for Application in Future Periods The AASB has issued new and amended accounting standards and interpretations that have mandatory application dates for

future reporting periods. The Group has decided against early adoption of these standards. A discussion of those future requirements and their impact on the Group follows:

• AASB 9: Financial Instruments and AASB 2010–11: Amendments to Australian Accounting Standards arising from AASB 9 [AASB 1, 3, 4, 5, 7, 101, 102, 108, 112, 118, 121, 127, 128, 131, 132, 136, 139, 1023 & 1038 and Interpretations 10 & 12] (applicable for annual reporting periods commencing on or after 1 January 2013).

These standards are applicable retrospectively and amend the classification and measurement of financial assets. The Group has not yet determined the potential impact on the financial statements.

The changes made to accounting requirements include: • simplifying the classifications of financial assets into those carried at amortised cost and those carried at fair

value; • simplifying the requirements for embedded derivatives; • removing the tainting rules associated with held-to-maturity assets; • removing the requirements to separate and fair value embedded derivatives for financial assets carried at

amortised cost; • allowing an irrevocable election on initial recognition to present gains and losses on investments in equity

instruments that are not held for trading in other comprehensive income. Dividends in respect of these investments that are a return on investment can be recognised in profit or loss and there is no impairment or recycling on disposal of the instrument; and

• reclassifying financial assets where there is a change in an entity’s business model as they are initially classified based on:

(a) the objective of the entity’s business model for managing the financial assets; and (b) the characteristics of the contractual cash flows.

• AASB 2011–9: Amendments to Australian Accounting Standards – Presentation of Items of Other Comprehensive Income

[AASB 1, 5, 7, 101, 112, 120, 121, 132, 133, 134, 1039 & 1049] (applicable for annual reporting periods commencing on or after 1 July 2012)..

The main change arising from this Standard is the requirement for entities to group items presented in other comprehensive income (OCI) on the basis of whether they are potentially reclassifiable to profit or loss subsequently. This Standard affects presentation only and is therefore not expected to significantly impact the Group.

The Group does not anticipate the early adoption of any of the above Australian Accounting Standards.

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Note 2 Revenue Consolidated Group Parent Entity 2012 2011 2012 2011 $ $ $ $ Other Revenue

- Interest received 12 379 12 379 Total sales and other revenue 12 379 12 379 Note 3 Loss for the Year Expenses Loss on disposal of property, plant and equipment - 1,708 - 1,708 Depreciation and amortisation 3,657 3,656 3,657 3,656 Debt forgiveness - - 2,821 203,523 Note 4 Income Tax Expense The prima facie tax on profit from ordinary activities before income tax is reconciled to the statement of comprehensive income as follows:

Prima facie tax payable on profit from ordinary activities - Consolidated group (126,946) (44,566) - - - Parent entity - - (125,883) (106,090)

Less: Tax effect of:

- Tax losses not brought to account 126,946 44,566 125,883 106,090 Income Tax attributable to entity - - - - Note 5 Key Management Personnel Compensation (a) Names and positions held of consolidated and parent entity key management personnel in office at any time during the financial

year are: Key Management Personnel Position Sim Pin Quek Chairman Isaac Ng CEO Rajen Rai Non-executive director Mark Howard-Browne Non-executive director Hee Kok Chng Non-executive director Key Management Personnel remuneration has been included in the Remuneration Report section of the Directors’ Report (b) Shareholdings Number of shares held by Key Management Personnel Balance at

01 Jan 12 Share

Consolidation Received as

compensation Balance at 31 Dec 12

No. No. No. No. Key Management Personnel Isaac Ng 5,000,000 (3,750,000) 500,000 1,750,000 5,000,000 (3,750,000) 500,000 1,750,000 Note 6 Auditors’ Remuneration Consolidated Group Parent Entity 2012 2011 2012 2011 $ $ $ $ Remuneration of the auditor of the parent entity for:

- Auditing or reviewing the financial report 20,750 20,046 20,750 20,046 - Other services 17,575 - 17,575 -

Remuneration of other auditors of subsidiaries for:

- Taxation services 1,500 850 - -

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Consolidated Group Parent Entity 2012 2011 2012 2011 $ $ $ $ Note 7 Dividends Franking credit balance The amount of franking credits available for the subsequent financial year are:

Franking account balance as at the end of the financial year at 30% (2011: 30%)

1,497,000

1,497,000

1,497,000

1,497,000

1,497,000 1,497,000 1,497,000 1,497,000 Note 8 Earnings per Share Consolidated Group 2012 2011 $ $ (a) Reconciliation of earnings to profit or loss Loss (423,152) (148,554) Earnings used to calculate basic EPS (423,152) (148,554) Earnings used in the calculation of dilutive EPS (423,152) (148,554) (b) Reconciliation of earnings to profit or loss from continuing operations Loss from continuing operations (423,152) (148,554) Earnings used to calculate basic EPS from continuing operations (423,152) (148,554) Earnings used in the calculation of dilutive EPS from continuing operations (423,152) (148,554) No. No. (c) Weighted average number of ordinary shares outstanding during the year used in calculating

basic EPS

32,805,269

113,540,626 Weighted average number of ordinary shares outstanding during the year used in calculating

dilutive EPS

32,805,269

113,540,626 Note 9 Cash and Cash Equivalents Consolidated Group Parent Entity 2012 2011 2012 2011 $ $ $ $ CURRENT Cash at bank and in hand 3,282 8,441 2,376 5,973 3,282 8,441 2,376 5,973 Reconciliation of cash Cash at the end of the financial year as shown in the cash flow statement is reconciled to items in the statement of financial position as follows:

Cash and cash equivalents 3,282 8,441 2,376 5,973 3,282 8,441 2,376 5,973 Note 10 Trade and Other Receivables CURRENT Other receivables 750,000 650,000 750,000 650,000 750,000 650,000 750,000 650,000 See note 20 (a) for additional information and subsequent events in relation to the deposit Note 11 Controlled Entities Controlled Entities Consolidated Country of Incorporation Percentage (%) Owned Parent Entity: 2012 2011 El Corporation Limited Australia Subsidiaries of El Corporation Limited: Datamatic Limited New Zealand 90 90 EL Pty Ltd (Formerly Acma Network Pty Ltd) Australia 100 100 Max Media Pte Ltd Taiwan - 60 The operations of Max Media Pte Ltd were wound down in late 2012 and the company was deregistered.

- 21 -



Note 12 Property, Plant and Equipment Consolidated Group Parent Entity 2012 2011 2012 2011 $ $ $ $ PLANT AND EQUIPMENT At Cost 14,625 14,625 14,625 14,625 Accumulated depreciation (9,273) (5,616) (9,273) (5,616) 5,352 9,009 5,352 9,009 Movements in Carrying Amounts Movements in carrying amounts for each class of property, plant and equipment between the beginning and the end of the financial year: Consolidated Group:

Plant and Equipment

Total

$ $ Balance at 1 January 2012 9,009 9,009 Depreciation expense (3,657) (3,657) Balance at 31 December 2012 5,352 5,352 Parent entity:

Plant and Equipment

Total

$ $ Balance at 1 January 2012 9,009 9,009 Depreciation expense (3,657) (3,657) Balance at 31 December 2012 5,352 5,352 Note 13 Trade and Other Payables Consolidated Group Parent Entity CURRENT 2012 2011 2012 2011 $ $ $ $ Unsecured liabilities Trade Payables 96,196 7,708 95,824 7,708 Sundry payables and accrued expenses 80,860 49,671 80,860 49,671 177,056 57,379 176,684 57,379 Note 14 Financial Liabilities CURRENT Short-term borrowings 388,500 1,135,000 388,500 1,135,000 388,500 1,135,000 388,500 1,135,000 The short term borrowings of $1,135,500 at 31 December 2011 were converted to share capital in January 2012. Note 15 Provisions Employee entitlements - Opening balance at 1 January 2011 8,384 6,077 8,384 6,077 - Amounts provided 3,051 2,307 3,051 2,307 - Balance at 31 December 2011 11,435 8,384 11,435 8,384 Analysis of total provisions - Current 11,435 8,384 11,435 8,384 11,435 8,384 11,435 8,384 Note 16 Issued Capital 34,785,597 (2011: 112,442,265) fully paid ordinary shares 25,653,476 24,516,976 25,653,476 24,516,976 25,653,476 24,516,976 25,653,476 24,516,976 Ordinary Shares No. No. No. No. - At the beginning of the reporting period 114,442,265 112,442,265 114,442,265 112,442,265 - Shares issued 9,300,000 2,000,000 9,300,000 2,000,000

123,742,265 114,442,265 123,742,265 114,442,265 - Share consolidation 9 July 2012 (1 for 4) (92,556,668) - (92,556,668) - - Shares issued 9 July 2012 3,600,000 - 3,600,000 - - At reporting date 34,785,597 114,442,265 34,785,597 114,442,265 Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of shares held. At the shareholders’ meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands. At the Annual General Meeting held on 22 June 2012, the shareholders approved a resolution authorising the consolidation of every 4 shares into 1 share. The consolidation was completed on 9 July 2012.

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Note 17 Reserves (a) Foreign Currency Translation Reserve The foreign currency translation reserve records change differences arising on translation of a foreign controlled subsidiary. (b) Forfeited Share Reserve The forfeited share reserve records the value of shares forfeited under a since terminated executive share scheme. Note 18 Segment Reporting Primary Reporting – Business Segments

Total Mining Communication

2012 2011 2012 2011 2012 2011 $ $ $ $ $ $

REVENUE Unallocated revenue 12 379 12 - - 379 Total Revenue 12 379 12 - - 379 RESULT Segment Result (423,152) (148,554) (423,152) - - (148,554) Loss before income tax (423,152) (148,554) (423,152) - - (148,554) Loss after income tax (423,152) (148,554) (423,152) - - (148,554) ASSETS Segment Assets 758,634 667,450 758,634 650,000 - 17,450 Total Assets 758,634 667,450 758,634 650,000 - 17,450 LIABILITIES Segment Liabilities 576,991 1,200,763 576,991 - - 1,200,763 Total Liabilities 579,991 1,200,763 576,991 - - 1,200,763 OTHER Depreciation and amortisation of segment assets 3,657 3,656 3,657 - - 3,656 Secondary Reporting – Geographic Segments

Segment revenues from external customers

Carrying amount of segment assets

Carrying amount of non-current segment assets

2012 2011 2012 2011 2012 2011 $ $ $ $ $ $

Australia 12 379 757,752 665,056 5,352 9,009 New Zealand - - 882 906 - - Taiwan - - - 1,488 - - 12 379 758,634 667,450 5,352 9,009

Note 19 Cash Flow Information Consolidated Group Parent Entity 2012 2011 2012 2011 $ $ $ $ Reconciliation of cash flow from operations with loss after income tax Loss after income tax (423,152) (148,554) (419,610) (353,632) Non-cash flows in loss Depreciation 3,657 3,656 3,657 3,656 Debt forgiveness - - - 201,589 Shares issued for nil consideration 1,500 4,000 1,500 4,000 Foreign currency exchange reserve 1,608 28 - - Changes in assets and liabilities, net of the effects of purchase and disposal of subsidiaries

Increase in trade and term receivables (100,000) (649,614) (100,000) (649,614) Increase in trade payables and accruals 119,677 1,535 119,305 4,957 Increase in provisions 3,051 2,307 3,051 2,307 Cash flow from operations (393,659) (786,642) (392,097) (786,737)

Note 20 Events after Balance Date (a) Included in trade and other receivables is $750,000 (as disclosed in note 10) in relation to a deposit for the acquisition of the Birthday

Mine. On 21 September 2012 the Company announced that the agreement to acquire the Birthday Mine had been terminated as a result of the non satisfaction of a key condition precedent. Pursuant to the terms of the agreement the deposit of $750,000 was repayable by the Vendor.

Following the Vendor’s failure to repay the deposit, the Company commenced proceedings in the Supreme Court of Western Australia to recover the deposit on 3 October 2012 and the Vendor filed a counterclaim against EL Corporation on or about 9 November 2012.

On 26 February 2013, Summit Light Ventures Ltd, entered into a written Sale and Purchase Agreement with the Vendor to purchase the Birthday Mine, with a settlement date of 20 March 2013. Pursuant to the Sale and Purchase Agreement, Summit Light Ventures Ltd has procured a Settlement Agreement between EL Corporation and the Vendor. Under the Settlement Agreement, Summit Light Ventures Ltd was to pay the sum of $750,000 in cash to the Company on the Settlement Date (20 March 2013) as full and final settlement of all claims and rights that the Company or the Vendor has or may have against each other arising out of the agreement to acquire the Birthday Mine. The deposit of $750,000 for the acquisition was to have been refunded on 20th March 2013, however, Summit Light Ventures Ltd had a delay in their settlement with Steven Shilkin. The Company has been advised that the completion will be scheduled for end April 2013.

(b) Other than disclosed above, there were no events subsequent to balance date that would affect the operations of the Company. (c) The financial report was authorised for issue on March 28, 2013 by the board of directors.

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Note 21 Related Party Transactions Consolidated Group Parent Entity 2012 2011 2012 2011 $ $ $ $ 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 Directors Fees for accounting services provided by Mark Howard-Browne during the year

16,034 16,472 16,034 16,472

Payable outstanding to Mark Howard-Browne at year end 3,548 1,278 3,548 1,278 Note 22 Financial Risk Instruments (a) Financial Risk Management Policies

The group’s financial instruments consist mainly of deposit with banks, local money market instruments, short-term investments, accounts receivable and payable, loans to and from subsidiaries, bills, leases, preference shares, and derivatives.

The main purpose of non-derivative financial instruments is to raise finance for group operations. Derivatives are not used by the group.

(i) Financial Risk

The main risks the group is exposed to through its financial instruments are interest rate risk, foreign currency risk, liquidity risk, credit risk and price risk.

Interest rate risk Interest rate risk is managed with a mixture of fixed and floating rate debt. At 31 December 2012 & 100% of group debt is fixed. For further details on interest rate risk refer to Note 22 (b) (i) & (ii).

Foreign currency risk The group is exposed to fluctuations in foreign currencies arising from the sale and purchase of goods and services in currencies other than the group’s measurements currency. Refer to Note 22 (b) (i) for further details.

Liquidity risk The group manages liquidity risk by monitoring forecast cash flow and ensuring that adequate unutilised borrowing facilities are maintained.

Credit risk The maximum exposure to credit risk, excluding the values of any collateral or other security, at balance date to recognised financial assets, is then carrying amount, net of any provisions for impairment of those assets, as disclosed in the balance and notes to the financial statements. The consolidated group does not have any material credit risk exposure to any single receivable or group of receivable or Group of receivables under financial instruments entered into by the consolidated group.

(b) Financial Instruments

(i) Financial Instruments Composition and Maturity Analysis The consolidated group’s exposure to interest rate risk, which is the risk that a financial instrument value will fluctuate as a

result of changes in market interest rates and the effective weighted average interest rates on classes of financial assets and financial liabilities, is as of follows:

Weighted Average Effective Interest

Rate

Floating Interest Rate

Non-interest Bearing Total

2012 2011 2012 2011 2012 2011 2012 2011 % % $ $ $ $ $ $ Consolidated Group Financial Assets

Cash and cash equivalents 0.01 0.01 3,282 8,441 - - 3,282 8,441 Receivables - - 750,000 650,000 750,000 650,000 Total Financial Assets 3,282 8,441 750,000 650,000 753,282 658,441 Financial Liabilities Trade and other payables - - 177,056 57,379 177,056 57,379 Short-term borrowings - - 388,500 1,135,000 388,500 1,135,000

Total Financial Liabilities - - 565,556 1,192,379 565,556 1,192,379

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Financial liability and financial asset maturity analysis Within 1 Year 1 to 5 Years Total 2012 2011 2012 2011 2012 2011 $ $ $ $ $ $ Consolidated Group Financial liabilities due for payment

Trade and other payables 177,056 57,379 - - 177,056 57,379 Financial liabilities 388,500 1,135,000 - - 388,500 1,135,000 Long-term borrowings - - - - - - Total expected outflows 565,556 1,192,379 - - 565,556 1,192,379 Financial assets – cash flows realisable

Cash and cash equivalents 3,282 8,441 - - 3,282 8,441 Receivables 750,000 650,000 - - 750,000 650,000 Total anticipated inflows

753,282

658,441

-

-

753,282

658,441

Net inflow/(outflow) on financial instruments

187,726

(533,938)

-

-

187,726

(533,938)

(ii) Net Fair Values The net fair values of: - Term receivables and government and fixed interest securities and bonds are determined by discounting the cash

flows, at the market interest rates of similar securities, to their present value. - Other assets and other liabilities approximate the carrying value.

No financial assets and financial liabilities are readily traded on organised markets in standardised form other than listed investments, forward exchange contracts and interest rate swaps.

Financial assets where carrying amounts exceeds net fair values have not been written down as the consolidated group

intends to hold these assets to maturity.

Aggregate net fair values and carrying amounts of financial assets and financial liabilities at balance date:

2012 2011 Consolidated Group Carrying

Amount Net Fair Value Carrying

Amount Net Fair Value

$ $ $ $ Financial Assets Cash and cash equivalents 3,282 3,282 8,441 8,441 Receivables 750,000 750,000 650,000 650,000 Total Financial Assets 753,282 753,282 658,441 658,441 Financial Liabilities Trade and other payables 177,056 177,056 57,379 57,379 Short-term borrowings 388,500 388,500 1,135,000 1,135,000 Long-term borrowings - - - - Total Financial Liabilities 565,556 565,556 1,192,379 1,192,379

Note 23 Cash Management Management controls the capital of the Group in order to maintain a good debt to equity ratio, provide the shareholders with adequate returns and ensure that the Group can fund its operations and continue as a going concern. The Group’s debt and capital includes ordinary share capital and financial liabilities, supported by financial assets. There are no externally imposed capital requirements. Management effectively manages the Group’s capital by assessing the Group’s financial risks and adjusting its capital structure in response to changes in these risks and in the market. These responses include the management of debt levels, distributions to shareholders and share issues. Note 24 Intangible Assets Consolidated Group Parent Entity 2012 2011 2012 2011 $ $ $ $ Capitalised licence fees at cost - 140,566 - - Less: accumulated amortisation - (5,187) - - Less: accumulated impairment - (135,379) - - - - - - Capitalised licence fees were considered by the directors to be impaired fully in the 2010 financial year.

- 25 -



Note 25 Company Details The registered office of the company is: Boardroom Pty Ltd Level 7, 207 Kent St SYDNEY NSW 2000 The principal place of business is: EL Corporation Limited Level 18, 99 Mount St NORTH SYDNEY NSW 2060

- 26 -

Directors’ Declaration

The directors of the company declare that: 1. the financial statements and notes set out on pages 11 to 26, are in accordance with the Corporations Act 2001 and:

(a) comply with Australian Accounting Standards, which, as stated in accounting policy Note 1 to the financial statements, constitutes

compliance with International Financial Reporting Standards (IFRS); and

(b) give a true and fair view of the financial position as at 31 December 2012 and of the performance for the year ended on that date of the company and the consolidated group;

2. the directors have been given the declarations required by s 295A of the Corporations Act 2001 from the Chief Executive Officer and Chief Financial Officer; and

3. in the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors

................................................... Sim Pin Quek Chairman Dated this 28th day of March 2013

- 27 -

RSM Bird Cameron Partners

Level 12, 60 Castlereagh Street Sydney NSW 2000

GPO Box 5138 Sydney NSW 2001

T +61 2 9233 8933 F +61 2 9233 8521

28 Liability limited by a scheme approved under Professional Standards Legislation

Major Offices in: Perth, Sydney, Melbourne, Adelaide and Canberra ABN 36 965 185 036

RSM Bird Cameron Partners is a member of the RSM network. Each member of the RSM network is an independent accounting and advisory firm which practises in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.

INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF

EL CORPORATION LIMITED

Report on the Financial Report We have audited the accompanying financial report of EL Corporation Limited (“the company”), which comprises the statements of financial position as at 31 December 2012, and the statements of comprehensive income, statements of changes in equity and statements of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors' declaration of the company and the consolidated entity comprising the company and the entities it controlled at the year’s end or from time to time during the financial year. Directors’ Responsibility for the Financial Report The directors of the company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that is free from material misstatement, whether due to fraud or error. In Note 1, the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that the financial statements comply with International Financial Reporting Standards. Auditor’s Responsibility Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. These Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance about whether the financial report is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report.

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

opinions.

29

Independence In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001. We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of EL Corporation Limited, would be in the same terms if given to the directors as at the time of this auditor's report. Basis for Qualified Opinion

As disclosed in Note 20(a), included in trade and other receivables is $750,000 which was expected to be received in full on 20 March 2013. No payment has been received as at the date of this report which creates a significant uncertainty as to the recoverability of this asset. We have been unable to perform alternative audit procedures to enable us to form an opinion on the recoverability of this asset. We have therefore been unable to obtain sufficient appropriate audit evidence in respect of the carrying value of the $750,000 deposit as at 31 December 2012. Consequently, we are unable to determine whether any adjustments to the carrying value of this asset are necessary.

Qualified Opinion

In our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph: (a) the financial report of EL Corporation Limited is in accordance with the Corporations Act 2001, including:

(i) giving a true and fair view of the company's and consolidated entity’s financial positions as at 31 December 2012 and of their performance for the year ended on that date; and

(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and

(b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 1. Report on the Remuneration Report We have audited the Remuneration Report included in pages 8 to 9 of the directors’ report for the year ended 31 December 2012. The directors of the company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. Opinion In our opinion the Remuneration Report of EL Corporation Limited for the year ended 31 December 2012 complies with section 300A of the Corporations Act 2001.

RSM BIRD CAMERON PARTNERS

G N SHERWOOD

Partner

Sydney, NSW

Dated: 28 March 2013


ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

SHAREHOLDER STATISTICS Distribution of Shareholders Range of Holdings

Numbers of shareholders

Ordinary

% of Issued

Capital 1 - 1000 234 0.33 1,001 – 5,000 95 0.72 5,001 – 10,000 16 0.36 10,001 – 100,000 19 1.49 100,000 – and over 23 97.10 387 100.00 The twenty largest shareholders of ordinary shares held 96.12% of the total ordinary shares on issue. Shareholder’s Name

Numbers of shares held

% of Issued

Capital Gim Lian Doris Chung 5,041,667 14.49 Atlas Group Holdings Pte. 5,000,000 14.37 Patrick Hwa Kwang Chew 4,875,000 14.01 Atlas Capital Pte Ltd 4,250,000 12.22 Mr Keong Chee Yam 3,675,000 10.56 Infinio Group Limited 2,496,750 7.18 Isaac Poh Seng Ng 1,750,000 5.03 Ms Lee Hoon Quek 1,625,000 4.67 Mr Choong Onn Lee 1,375,000 3.95 Mr Check Kian Low 750,000 2.16 Cheow Tong Yeo 750,000 2.16 Equator Capital Limited 344,718 0.99 Mr Marcello Pragier 265,481 0.76 Chua Siow Leng 250,000 0.72 Ai Lin Low 225,000 0.65 Keng Lin Tan 195,476 0.56 Jennifer Jane Field 170,501 0.49 Foon Seen Leong 142,500 0.41 GA & AM Leaver Investments Pty 127,740 0.37 Mr Alfredo Varela 125,000 0.36 Voting Rights All voting shares (whether fully paid or not) carry one vote per share without restriction.

Consolidation

At the Annual General Meeting held on 22 June 2012, the shareholders approved a resolution authorising the consolidation of every 4 shares into 1 share. The consolidation was completed on 9 July 2012 Substantial Shareholding as at 25th February 2013 Shareholder’s Name

Numbers of shares held

Gim Lian Doris Chung 5,041,667 Atlas Group Holdings Pte. 5,000,000 Patrick Hwa Kwang Chew 4,875,000 Atlas Capital Pte Ltd 4,250,000 Mr Keong Chee Yam 3,675,000 - 30 -

NOTES

Documents

Datamatic Annual Report - EL CORPORATION · EL Corporation Limited and Controlled Entities ABN 41 002 737 733 - 2 - Chairman’s Report The directors of El Corporation Limited announce