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ANNUAL REPORT 2015/2016 FOR THE FINANCIAL YEAR ENDED 30 JUNE 2016

1 These notes form an integral part of the Financial Statements.


CONTENTS

Message from the Chair

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Chief Executive’s Report 6 The Year at a Glance

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Success Stories 12 Report on Performance Measures

18

Creative HQ Sponsors 22 Creative HQ Annual Report

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Statement of Comprehensive Revenue and Expense

28

Statement of Financial Position

29

Statement of Changes in Equity

30

Statement of Cash Flows

31

Notes to the Financial Statements

32

Independent Auditor’s Report

47

Company Directory 49 2


The Customer Discovery training presented by Creative HQ has transformed the way NZ Steel interacts with its customers and is leading to significant customer insights. This work will have significant impact on our product and service development. DR. TROY COYLE, INNOVATION MANAGER, NZ STEEL Creative HQ is very well placed to offer something unique and inspiring to Chinese businesses. The Chinese Government has identified innovation as a central pillar of China’s economic development plans for the coming five years. This focus has cascaded down to provincial and city levels where local governments are investing a great amount of resources to cultivate innovation. But innovation means different things to different people, especially across borders and cultures. Where Creative HQ can make a difference is by showing Chinese start-ups and young businesses how New Zealand does innovation, and how we do it differently. That jump-start or trigger can give a Chinese business the edge back in their home market. Young Chinese entrepreneurs are naturally hard-working and creative – competition in such a huge market breeds survival and success tactics – but in any country there are hard-wired mental parameters and glass walls, which an accelerator like Creative HQ can help to overcome.

During Venture Up, Creative HQ was a constant source of knowledge, information, and advice. If we had any problems or questions Creative HQ was the place to go, almost always there would be someone there who could guide us and give useful advice. It was like a homeaway-from-home, somewhere you could walk in and immediately feel comfortable and surrounded by familiar faces. DEREK LIEU, CO-FOUNDER, RELAY, VENTURE UP Creative HQ has been a tireless champion of our Wellington startup community. Startup Weekend could not have grown into such an important part of our local ecosystem without the ongoing support the talented Creative HQ team provides to our small, volunteer-led organisation. DAVE CLEARWATER, FACILITATOR, STARTUP WEEKEND WELLINGTON

249 Jobs

Created by our alumni as of June 30 2016

$24.6m1

ALISTAIR CROZIER, NZ CONSUL- GENERAL, CHICKEN RUN, LIGHTNING LAB XX

Total aggregated annual revenue from Creative HQ alumni

128

actively trading

$3.8m

Total private investment raised by Lightning Lab acceleration programmes

177 total ventures

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¹ Reported results are based on information gathered from a survey generated by Creative HQ and the provided information cannot be cost effectively substantiated.


MESSAGE FROM THE CHAIR Wellington is a city that embraces diversity, creativity and ingenuity. Wellingtonians love a challenge and I’m delighted to be a part of an organisation that is also incredibly passionate about pushing people to be their best. This past financial year 2015/2016 has been an exciting period for Creative HQ. We have seen our parent organisation Grow Wellington become part of the Wellington Regional Economic Development Agency (WREDA), along with other agencies Absolutely Positively Wellington Tourism, Venues and Events. WREDA was created to advance the prosperity and liveability of the Wellington region and Creative HQ is now a wholly owned subsidiary of WREDA. One of our key strategic goals for Creative HQ has been to increase opportunities for startups in the Wellington region. Having our base in the capital city means we’re perfectly placed to build bridges between startups and government and in 2015/16 we have worked with the Ministry of Business, Innovation and Employment (MBIE) to put 10 new

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ventures through the second R9 GovTech Accelerator. The 10 teams in the R9 Accelerator were selected from a list of over 60 opportunities and challenges put forward by the Result Area 9 – Better for Business agencies such as Statistics NZ, Inland Revenue and ACC. I’m thrilled that following the exciting investment showcase at the end of the accelerator we’ve been able to help secure over $1million in funding across 5 ventures to build out their proposed solution for better public services. In the corporate innovation space, Creative HQ has also been able to make excellent progress this last financial year. Working with organisations such as the Singularity University and Neo, our team has developed deep expertise in key methodologies such as Lean Startup and Exponential Organisations (ExO). We shared this expertise with New Zealand’s innovation ecosystem at the “Lean 15” conference in October 2015 and started working with enterprise clients such as Trade Me Jobs on structured disruptive innovation programmes to help NZ’s corporates become innovation leaders globally. Based on the success of these enterprise innovation programmes, we are now a leading provider of innovation services and are privileged to work with iconic New Zealand companies such as Fonterra, Contact Energy, Kiwibank and many others. Our work with large companies mirrors an international trend for corporate acceleration which provides opportunities for startups to scale-up quickly through teaming up with enterprise organisations. At the other end of the spectrum we have seen a significant spike in interest in youth entrepreneurship and entrepreneurial education. Venture Up, our acceleration programme for young entrepreneurs, has seen a number of exciting success stories. At the end of this year’s programme, in February 2016, Part Timer - a mobile platform for student jobs, became the first Venture Up team to receive private investment funding and the founder, Rebecca Gidall, has become one of the youngest entrepreneurs in New Zealand to attract investment at the age of 18. Closing the gender gap is another important issue in the tech and startup space and something we put particular focus on this year. Our 2016 Lightning Lab XX programme for female founders was a great success with 9 teams going through the accelerator. As the only business accelerator in Australasia with a deliberate focus on gender diversity (where at least one of the co-founders

must be female), we’ve achieved another Creative HQ first. We also welcomed our first Chinese team “LiangMa” (or “Chicken Run”) from Chengdu in the Sichuan province to our programme, who charmed everyone at the Lightning Lab XX Demo Day with their spirited presentation. Following the success of Lightning Lab Manufacturing at the end of 2015, we’ve successfully partnered with Hutt City Council to establish 1st Assembly - a space focused on hardware innovation, co-working and events. Through 1st Assembly we’re privileged to host a fortnightly workshop where people of all interest and skill levels can come together to create, explore and challenge their ideas in a nurturing and innovative environment. Between Creative HQ’s base in Wellington Central and 1st Assembly in Lower Hutt we also host New Zealand’s largest entrepreneur Meetup group “Startup Garage”, with over 1,700 members. Last but not least, we’ve been able to grow our contribution to the Wellington regional economy whilst diversifying income reliance away from local and national government grants to service revenues, such that local government funding is now only 20% of our overall income. Contributions from central government for core programmes is less than 15% of our total budget. Creative HQ has established a leadership position in a number of innovation services in New Zealand and new service revenue has replaced some reduced government funding. Our team at Creative HQ makes all of the above happen. On behalf of the Board, I extend our thanks to Creative HQ’s staff and management who have demonstrated resilience, hard work and commitment toward achieving a common goal - to develop world class entrepreneurs and drive innovation in the Wellington region. Through Creative HQ’s enthusiasm and dedication I am confident that we have all the right ingredients and collective experience to continue to drive positive change and business opportunities in the year to come. BARRY BROOK CHAIR

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CHIEF EXECUTIVE’S REPORT The close of the financial year brings to an end a personal three-year cycle that started with my appointment in September 2013. I am delighted with what we have achieved throughout this period and in particular over the past 12 to 18 months. We believe that entrepreneurs are everywhere – from the government sector and schools, to large organisations and the social and not-for-profit sectors. Creative HQ is on a mission to unleash the power of people’s entrepreneurial spirit wherever they may work or whatever they may do. The notion that “there’s got to be a better way” is often the starting point for innovators and entrepreneurs. Depending on their circumstances this thought may turn into a startup, a corporate spin-off venture or a new public service. By working with large companies, government and educational institutions we have been able to vastly increase the amount of opportunities for entrepreneurs and consequently the volume of early stage ventures being started in our region. The R9 GovTech accelerator we run with MBIE is an excellent example for creating new opportunities for entrepreneurship otherwise would not exist. The programme raised more than $1.2 million in funding for five teams who continue building solutions for better public services. These include a service to provide digital authority to act on behalf of a person/company and an immigration process for highly skilled IT professionals without a tertiary degree. During the 2015/16 financial year we demonstrated our own commitment to leadership by delivering a number of “firsts”. They included the first Australasian conference on Lean Startup and Lean Enterprise (“Lean 15”), the first business accelerator in Asia/Pacific for female founders (“Lightning Lab XX”) and the first corporate programme on exponential innovation (“ExO Builder”) with Trade Me Jobs.

Creative HQ’s role is also about advancing the competitive advantage of Kiwi companies through innovation. We see vast opportunities for Kiwi companies, particularly larger corporates to harness the power of disruptive innovation. Providing frameworks to create competitive advantage through disruptive innovation is the work of Singularity University, a Silicon Valley think-tank. The ground-breaking work of one of Singularity University’s directors Salim Ismail on “Exponential Organisations” has been a guiding principle for our work with entrepreneurs and corporates. Over the past year we have worked extensively in this area and have become the only provider in New Zealand to complete exponential innovation programmes with large organisations. The world is facing an era of significant and fundamental change never previously experienced. Tackling disruption full-on requires leadership and risk taking. In an increasingly competitive global market, our companies can’t be just “fast followers”. We must be global leaders in selected sectors and industry niches to ensure long term health in our economy. With this in mind, through our programmes and methodologies we aim to create startups, ventures and companies that are recognised as global leaders. Like many proud Wellingtonians, I love coffee and true coffee lovers don’t just go to the closest café, they walk an extra block to get their caffeine hit from their favourite barista. It’s the same with Creative HQ where our target audiences now come to us – not because we are the most convenient local provider but because we offer unique programmes and outcomes that are worth travelling the extra mile for. From Lightning Lab accelerators, GovTech acceleration programmes and youth entrepreneurship bootcamps to our innovation and acceleration services for corporates, we are co-creating solutions with our customers for a better future.

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Creative HQ is made up of a group of extraordinary people who are deeply passionate about innovation, entrepreneurship and creating impact. Our team brings incredible skill, talent and a hard-working ethos to the organisation. The results we create speak for themselves but all of our achievements are realised through the outstanding work of everyone at Creative HQ along with the tireless work of our mentors, advisors and partner organisations. Our parent organisation WREDA, core funders Callaghan Innovation and Hutt City Council, sponsors Chapman Tripp, Deloitte, CityLink and IWantMyName, as well as our many clients provide the fuel in our tank for which we are extremely grateful. Special mention must go to our Board of Directors for their ongoing wisdom, guidance and support. Lastly, and on behalf of everyone at Creative HQ, I applaud the efforts, spirit and drive of every entrepreneur, innovator and change agent slugging their guts out to make a difference for Wellington, New Zealand and the whole world. We salute you! STEFAN KORN CEO

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THE YEAR AT GLANCE Creative HQ has had an extraordinary year creating significant impact with existing programmes and newly developed initiatives. We back ourselves to constantly push boundaries to increase opportunities for startups and innovative ventures in New Zealand. We drive innovation across a wide range of sectors - whether it is working with government, corporates, school leavers and students or the entrepreneurial community at large. Over the last 12 months Creative HQ has become a recognised leader in startup acceleration, youth entrepreneurship and enterprise innovation. It’s been a busy year! We hosted the Lean 15 conference to a sell-out crowd over three days in October 2015. Our flagship conference “Lean 15” exposed a diverse New Zealand audience of innovators from all walks of life to the leading international experts in Lean Methodology practices. Creative HQ is forging the way with Lean Methodology, with 92% of Lean 15 participants expressing the value of the conference exceeded their expectations and offered them new insights into Lean methodologies that they hadn’t considered prior. 99% of participants would recommend a future Lean event to others. As a direct result of Lean 15, Trade Me Jobs completed Creative HQ’s 3-month disruptive innovation programme “ExO Builder” which is based on the principles of Exponential Organisations. We hosted and ran four Lightning Lab accelerator programmes. We created two new verticals for Lightning Lab in the last 12 months, continuing our journey to diversify the reach and impact in the acceleration space. Bucking the ‘hardware is hard’ mentality we delivered “Lightning Lab Manufacturing” in late 2015 applying the tried and tested Lightning Lab format to high value manufacturing ventures. At the same time, our delivery partners “Canterbury Development Corporation” hosted the first digital Lightning Lab programme in Christchurch. Thus providing opportunities for South Island startups and investors that until then had been relatively untapped by our Wellington and Auckland programmes.

We returned from the summer break to start the first ever female founder focussed accelerator in Asia/Pacific “Lightning Lab XX”. The aim of the programme was to help reset the gender balance in NZ’s entrepreneurial and tech community. Lightning Lab XX also resulted in another first for us - the programme hosted the first team from China “Chicken Run” to go through a Lightning Lab accelerator. Our programmes exude diversity, not only through working with different industry verticals but also by being open and inclusive to entrepreneurs from all walks of life in New Zealand and beyond. We’re proud to bring many rich flavours to Wellington’s vibrant startup ecosystem. A strong year in acceleration was rounded out by our delivery partners The Icehouse in Auckland completing their second Lightning Lab Digital in June 2016.

108

Entrepreneurs attending acceleration programmes

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Venture Up is highly effective in helping develop young people, with half of all participants saying that the programme was a factor in changing their future plans. Not only that, but 100% of all participants told us that they would recommend Venture Up to their friends. It’s no surprise that we saw a massive 40% increase in applications from Venture Up 2015 to 2016. We are enormously thankful to our funders and sponsors for Venture Up - Ministry of Youth Development, Young Enterprise Trust, Wellington City Council, Callaghan Innovation, Victoria University and Lightning Lab who share our passion for backing the next generation of entrepreneurs and business leaders. $11m Revenue generated overseas

We are passionate about helping youth discover their entrepreneurial talents. Venture Up is an intensive six week youth accelerator programme for high school leavers and university students aged 16-21 from all over New Zealand. Held in Wellington over the summer months it’s an intensive and immersive real world programme that aims to mentor and develop the next generation of Kiwi entrepreneurs. Venture Up is no summer camp though - business concepts, ventures and investment dollars are real. Many of the participants go on to develop viable businesses and five of the eight teams in Venture Up 2016 have done just that, with team “PartTimer” going on to close a seed investment round. PartTimer was originally an online platform to connect students with job opportunities, building a database of over 1,300 students in only 6 weeks, but has now expanded their reach beyond students to the entire workforce.

We’ve started a revolution in Government innovation in New Zealand. With support from grassroots entrepreneurial communities all the way through to cabinet, unheard of until now, we saw the completion of the “R9 Accelerator 2.0”, the second accelerator delivered in conjunction with the MBIE. The R9 Accelerator is one of the first government startup accelerators in the world and brings the public and private sectors together to deliver better public services. The R9 Accelerator nurtures mixed teams of creative, solution orientated people from government agencies and the startup community to build market-validated, seamless and pain free public services for businesses to interact with government. Using Design Thinking, the Lean Startup Methodology and Agile implementation R9 teams were able to rapidly develop customer-centric ideas over 3 months to present back to government decision makers at the programme’s investment showcase event. This year we were honoured to host four Government Ministers at the R9 showcase “Demo Day” which resulted in over $1.2 million in funding being raised for successful teams to build out their solutions.

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Our innovation work in the public sector doesn’t stop with Government agencies. Creative HQ is committed to working with government to create better commercial outcomes from taxpayer funded institutions - including academia and research organisations. Our “Get Funded” initiative comprises in-depth training workshops for scientists and researchers from around New Zealand to attract investment for commercialising research concepts. In 2015/16 we delivered Get Funded in New Zealand’s main cities Christchurch, Auckland and Wellington. The programme helps scientists and researchers think deeper about problem validation, customers, market application, pitching and storytelling over a two-day workshop. Participants, funders and stakeholders have expressed immense excitement about the engagement they see in the science world as a direct result of Creative HQ’s teaching of these practical skills. We are deeply grateful for the support and involvement of Kiwinet, MBIE and Powerhouse Ventures who have made Get Funded possible. We have established a new hardware community and startup hub. Based in Lower Hutt, 1st Assembly is our innovation space for hardware related prototyping, coworking, resources and events. We coach hardware startups and provide open access to Creative HQ’s longstanding growth programmes. 1st Assembly was created following the highly successful Lightning Lab Manufacturing programme and the space aims to further strengthen the hardware startup community and manufacturing industry in the Hutt. With Wednesday Workshops, Startup Garage and business bootcamps all being held in the space, Creative HQ is increasing its reach to the hardware community. Hutt City Council have been visionary with their decision to extend the use of the space and create a permanent home for hardware related ventures, returning the Hutt to its former leadership position in high value manufacturing.

We are leading the way in Exponential Organisation (ExO) training and innovation in New Zealand. Following our work to translate Salim Ismail’s book “Exponential Organisations” into workshops and structured innovation programmes, we worked with Trade Me Jobs to understand how they could disrupt themselves before getting disrupted by a competitor. Following the completion of this “ExO Builder” programme, we copresented results at the GOVIS conference in May 2016. We are now running corporate acceleration programmes on disruptive innovation with several large companies in New Zealand. We have also teamed up with the Ministry of Awesome to promote the upcoming Singularity University Summit in Christchurch later this year. The Summit will bring some of the world’s top talent in disruptive innovation to NZ and will highlight to Kiwi businesses that maintaining the status quo is the highest risk strategy in the current business environment. Every industry and sector will experience their “Uber Moment” over the next 10-15 years. We are passionate about making sure our local entrepreneurs, startup ventures and established organisations don’t get left behind during this exciting phase of economic evolution.

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Our communities and events are gaining in significance and impact. Since its inception in August 2014, we’ve grown our Meetup group “Startup Garage” into the largest Meetup community for entrepreneurs in New Zealand. Membership in Wellington alone is exceeding 1,700 individuals exceeding other more established business communities that have been around for decades. Startup Garage is an easy entry point for anyone wishing to get involved in the vibrant startup community in Wellington. Our fortnightly Meetup events have showcased iconic speakers such as; Derek Handley from B-Team, Rasmus Lerdorf inventor of PHP, Alan Schaaf founder of Imgur, local founders like Carnival Mobile’s Cody Bunea, Starnow’s Cameron Mehlhopt and STQRY’s Chris Smith, and inspiring ventures like IkeGPS, Goodnature, PartsTrader, Palantir, Resn and Mobi2Go.

STARTUP GARAGE

2500+

42

Total number of attendees to date

Speaker events

1761

Startup Garage members

Startups, entrepreneurs and networks that make a difference. The portfolio of companies that Creative HQ has worked with over the last 12 years has now grown to 177 alumni. Their impact continues to grow year by year, collectively receiving over $24m in revenue (of which $11m was generated from overseas) and employing over 249 staff during the financial year 2015/16. For example 2015 Lightning Lab graduate “Mish Guru” have seen some impressive results - they’ve just passed $1m in annual recurring revenue and are now based in the US working with the world’s largest consumer brand. Mish Guru’s continued success is a testament to their tenacity and dedication to the lessons learned while participating in the Lightning Lab Digital accelerator and Creative HQ’s post acceleration programme. The success of our alumni is not only about generating revenue and increasing their valuation; it’s also about bringing great ideas to life and developing future industry leaders. Entrepreneurs like Tom Harding, Rollo Wenlock, Kristen Lunman, Debra Hall and Chris Archer are becoming recognised leaders in the NZ business community frequently being interviewed and speaking at events to paint their visions for the future. Whether it be working with the government to deliver valuable business accelerators to the next generation of Kiwi entrepreneurs or working with prominent business people to nurture and grow those who need it most, our network of amazing mentors and coaches is one of our most valuable assets. To further add to the impact of our existing network we created a strategic partnership with one of the leading organisations in impact entrepreneurship in NZ - the Akina Foundation (formerly the Hikurangi Foundation). Akina have been warmly welcomed into the Creative HQ family and are now sharing our startup base in Dixon Street. Creative HQ has increased opportunities for startups and innovative ventures and led the way in startup acceleration, youth entrepreneurship and enterprise innovation. At a glance we have pushed boundaries creating impact with government, corporates, school leavers, students and the wider startup community and we look forward to driving positive change, in business in the year to come.

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SUCCESS STORIES LITTLE YELLOW BIRD Little Yellow Bird (LYB) has created a social enterprise that designs and manufactures bespoke uniforms for corporates while keeping a social mission at heart. Their key point of difference; an ethical supply chain. Everyone from the cotton farmer to the tailor is paid fairly for the work that they do and is ensured safe working conditions. They’ve built relationships directly with cotton farmers and suppliers throughout India - where all their products are made. Initially co-founders, Samantha Jones and Hannah Duder started selling women’s business shirts with a B2C model and quickly realised that there wasn’t much money or impact in this so they changed tact. They now focus on selling larger custom corporate orders to businesses instead. Their business model improves the livelihood of garment workers and uses business to break the cycle of poverty that exists in many communities today.

Business for LYB has continued tracking upwards since LLXX, they’ve gained large clients in Wellington, are making sales targets, growing their business and have plans to start actively selling into Australia early 2017. They have a trip to India booked for November to document their supply chain in more detail with the intention to show their customers the process from cotton to garment. Since participating in 4 month accelerator LLXX, LYB have joined us at the Creative HQ base and started paying themselves! Every day we make dozens of decisions about what we buy and from whom but how often do we think about where those products come from? LYB give us the opportunity to think about the lives we touch with the purchases we make.

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FUELLED The Fuelled journey started from a realisation that there was a gap in the market. Fuelled noticed most small to medium businesses in New Zealand struggling with cash flow management, in particular as their clients pay late and continue to extend payment terms. They saw that Xero has a large market share among SME’s and generates four times the revenue of the market average, while embracing new technologies at the same time. Since then Fuelled has been on a mission to build a world-class online invoice financing service for Xero customers. Fuelled is a part of Creative HQ’s Global Growth Programme, and believes New Zealand businesses deserve a better deal when it comes to financing their companies. Fuelled allows you to receive an immediate cash advance rather than wait 30, 60 or even 90 days for your customers to pay.

You pay a small percentage on each invoice and can sell as many or as few invoices as you wish. Access to this immediate source of finance makes the task of managing cash flow much easier, as well as providing the means to fund future growth. Fuelled has secured an exclusive position in the Xero Financial Web in New Zealand, making them the only cash flow funding partner. This is timely as they release the latest version of their product, which fully integrates with Xero providing a smooth online customer experience from end to end. As part of the Xero New Zealand launch of Financial Web, Fuelled will be introduced to hundreds of accountants and bookkeepers from Australasia this month, at Xerocon South in Brisbane.

13 These notes form an integral part of the Financial Statements.


PARTTIMER In January and February this year, Rebecca Gidall along with 37 other bright young entrepreneurs, participated in the second iteration of Venture Up. Over the course of 6 immersive weeks 8 teams formed, built, validated, pivoted and successfully pitched their business ideas with the support of Creative HQ’s venture managers.

They’ve leveraged on learnings gained at Venture Up and expanded their service beyond students, now catering to any age group. In the last few months the duo have brought in $50k investment, pivoted many times (leading to their now sustainable business model), finished building their minimum viable product, qualified for the Amazon Activate programme and hired an Auckland-based CTO, Paul Bowker.

During their time at Venture Up Rebecca’s team, PartTimer, validated their problem, marketed their solution and built a database of over 1,300 students looking for jobs. PartTimer left with a online platform that connected high school students with part time jobs through personalities, not CVs.

With some 500+ active job seekers in their system, they are currently revisiting their pool of Wellington based early adopters and working alongside them to develop a viable solution, providing a great way to obtain useful metrics. The next big steps for PartTimer are; focussing on sales efforts, adding brand value and expanding to all major cities in New Zealand.

Just three weeks after Venture Up PartTimer had its first investor. Vivian Morresey, ex-marketing and sales of both Xero and Greenbutton, joined PartTimer and they are now a part of the Global Growth Programme at Creative HQ.

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2SHAKES The R9 Accelerator aims to bring the public and private sectors together to work on real problems impacting businesses. R9 nurtures teams of creative, solutions-focused people to build market-validated solutions that make it possible for business to interact with the New Zealand Government. 2Shakes was one of the 10 teams to take part in the 3-month govt tech R9 Accelerator 2.0 and they very successfully pitched their business on the R9 Demo Day. 2Shakes illustrated how getting authority to act on behalf of another business is a real pain point for many organisations and believes it should only take “two shakes” to interact with government agencies and other businesses. They made it their mission to make New Zealand the easiest country in the world to help each other digitally. The bookkeepers are the heroes of the 2Shakes story. 2Shakes worked alongside the New Zealand Bookkeepers Association (NZBAI) throughout the accelerator. After all 2Shakes worked out that in New Zealand there are some 380,000 sole traders and small businesses that use bookkeepers and accountants to help with day-to-day financial matters. By making it easier for bookkeepers and other professionals to get authority to act on behalf of their clients, 2Shakes can save

New Zealand small businesses $23m dollars per year. Setting up authorities, seemingly simple at first, actually requires the bookkeepers to jump through many hoops to act on behalf of their clients. They must be set up with IRD, ACC, Companies Office, the client’s bank, and other agencies and private organisations. This requires working through silo’ed online processes, filling out paper forms, and asking for your client’s approval over and over. 2Shakes created a SaaS subscription model, incorporating electronic signatures and backed by the blockchain, that cut this process down to one painless step for the bookkeepers' client. One month after the accelerator finished 2Shakes gained investment funding from ACC, Business.Govt.nz (part of MBIE), and Data Futures Partnership. They now have more than 60 bookkeepers acting on behalf of around 8000 clients already signed up. 2Shakes knows that their business formula applies to accountants, brokers, lawyers, immigration advisers and many others - and they’ve promised us they’ll get there - but for now, they want to make the process perfect for bookkeepers.

15 These notes form an integral part of the Financial Statements.


CHICKEN RUN Based in Chengdu, Denny Zou and Steve Xin, founders of Chicken Run, switched countries to attend Lightning Lab XX. They wanted to stress test their business and accelerate their dream of building an empire of quality chicken. For most Chinese locals their reality is inconsistent and unsafe poultry purchasing options. Chicken Run identified a huge opportunity, with a market survey they determined that two-thirds of the population crave fresh chicken. In Chengdu alone there is a population of 15 million (almost 4 times the size of New Zealand) with an estimated demand of 240,000 chickens everyday. Chicken Run are carving out a high growth niche selling fresh poultry. Denny and Steve came to Wellington with a marginally profitable business and learned system design techniques to grow their revenue. Today, the team is set to triple their sales by the end of the year.

With comprehensive market validation, performance enhancement and market strategies in hand, the goal is to turn Chicken Run into a multimillion-dollar business by the end of 2017. “The Lightning Lab XX Accelerator has taken our business and vision to the next level,” says Denny, adding that the opportunity to savour a completely different lifestyle in New Zealand was an invaluable experience. “We have been exposed to a network of talented and helpful entrepreneurs, whose passion and courage have impressed, inspired and moved us.” Creative HQ relished the leadership opportunity to host Chicken Run and see this as the beginning of developing deeper strategic engagement with China.

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THE MISPRINT CO. The Misprint Co are primarily a service based startup that repurposes waste paper into good-looking notebooks. The designers turned entrepreneurs went through the first Lightning Lab Manufacturing (LLMFG) startup programme in 2015. They took their notebooks in at an early, roughly crafted stage. From there they developed into a company that actually uses the notebooks as a vehicle for behavioural change. Since LLMFG co-founders Jenny & Kareena have been exploring what they can do with a simple but overlooked solution to waste paper. Sustainability is at the core of their business. It takes 10 litres of water to make an A4 sheet of paper. To date the company has offset 648,070 litres of water from the paper production process and saved 64,807 sheets of paper. These figures are increasing daily! The company works with over 40 organisations and schools including Wellington City Council, MetService, Zealandia, Flick Electric Co, Grow Wellington, Strategy Advertising and Design, Massey University and Wellington East Girls College.

The Misprint Co place their collection bins at these organisations. Each collection box holds up to 4000 pieces of paper, saving 55% of a tree and 45,500 litres of water, making 350 notebooks. The last few months have been very busy for the The Misprint Co.; they’ve grown their customer base exponentially, stocked their notebooks nationwide, hired an intern and gained well-deserved media attention on Idealog, Dominon Post, and The TV ONE Breakfast show to name a few. Most recently they entered the Low Carbon Challenge and came out in the top three, granting them access to $15k funding from Wellington City Council. They match funded that with their crowdfund campaign. The Misprint Co doesn’t stop there, they have big goals in the pipeline. Next steps are to take their sustainable services up the country, scoping out and then scaling into Auckland. Misprint Co are an integral part of the Creative HQ space and the wider startup community. They are often seen on panel discussions providing mentorship and sharing knowledge with other young entrepreneurs.

17 These notes form an integral part of the Financial Statements.


REPORT ON PERFORMANCE MEASURES HIGH GROWTH/INCUBATION Creative HQ introduced 11 new companies to the High Growth Programme during 2015/16. The main goal of our High Growth Programme is to make startups attractive to investors and valuable to customers at every stage of their journey. The programme works in four modules: Startup, Discovery, Execution and Global. During each module, we develop the skills of the entrepreneurs and provide mentorship and coaching for the business.

All 4 companies that have successfully exited have achieved this, all of them becoming investment ready and attracting investment.

We have had 4 companies successfully exit this programme. A successful exit is determined when the company within the High Growth Programme has developed its capabilities, structure, systems and plans. It has an effective governance and management structure in place and the company will be globally ambitious. The company will likely attract equity investment or be investment ready.

We take a small equity portion in each company in return for the services provided. Based on external capital raised by each company, our portfolio is now valued at $1.42m1.

RESULT 2014/15

$1.4m

New Ventures starting the Incubation/Global Growth Programme

12

11

11

High Growth Exits

4

4

6

Ventures in Incubation programme no more than 24 months

No more than 25%

0%

0%

Portfolio Value1

$1.1m

$1.42m

$1.4m

$1.42m

$804k

JUNE-16

$334k

JUNE-15

RESULT 2015/16

JUNE-14

TARGET

JUNE-13

HIGH GROWTH /INCUBATION MEASURE

We aim to have each company work through the programme within 12 months. This gives founders enough time to validate their product or service and work towards a successful exit or a fast fail. No companies were within the programme longer than 24 months.

CREATIVE HQ VENTURE PORTFOLIO1

1 Based on external capital raised by each company within Creative HQ's portfolio.

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ACCELERATION We have taken 108 entrepreneurs and 44 teams through 4 acceleration programmes in Wellington, Auckland and Christchurch. The acceleration programme is a three-month, full-time, in-residence business accelerator. Each programme takes in up to 10 companies and provides each with structure, startup methodologies, business skills and focused support so they can successfully find the market fit for their products and rapidly grow their user base. The accelerator is an investment pathway where each programme finishes with a Demo Day with teams pitching to a room full of investors. Of the teams who pitched at Demo Day 52% received investment offers on the day.

108

Taken 108 entrepreneurs through 4 programmes

179+

Over 179 active mentors across all programmes

$3.8m

Total investment raised 6 months post Lightning Lab Demo Day 2016

The accelerator teams have raised a total of $3.8m six months after completing the programme and pitching at Demo Day with many more teams still completing their investment rounds. Mentors are a crucial part of our accelerator programmes and we couldn’t complete the programmes without them. Mentors join the teams on their startup journey offering specialised mentoring, coaching and connections for each of the companies. We have over 179 active mentors within all of the acceleration programmes and of these 179, each company works with several lead mentors. They provide specialised coaching and support for the team, they also work closely with other mentors with specialist skills like marketing, financial modelling, sales etc.

ACCELERATION MEASURE

TARGET

RESULT 2015/16

RESULT 2014/15

Entrepreneurs attending Lightning Lab Accelerator programme

50

108

24

Lightning Lab teams receive investment offers on Demo Day

50%

52%

78%

$3.8m

$2.7m

Investment raised six months’ post Demo Day (for Lightning Lab teams)

$3m

19


CUSTOMER ENGAGEMENT Venture Up is an intensive entrepreneurship accelerator programme, for 16-21 year olds. It is built around 3 themes: education, connection and resilience. There are places available for NZ’s top youth talent and submissions are received from across the country. Those who get offered a place on the programme demonstrate an interest in business, an open mind and drive to get things done. This year 38 young entrepreneurs attended the Venture Up programme.

CUSTOMER ENGAGEMENT MEASURE Students attending Venture Up programme

TARGET

30

40% increase

in attendees from 2015 to 2016

37%

female participants

38

RESULT 2015/16

RESULT 2014/15

participants from

38

24

locations across NZ

11

20


CREATIVE HQ OVERALL Creative HQ stays connected to its community and has provided ongoing support and connections for over 11 years through a number of programmes and service offerings. Through all of the programmes we have supported 1771 ventures through the High Growth and Acceleration programmes, Creative HQs previous core offerings. We keep in regular contact with our alumni community and track their progress. Our alumni companies have received over $24m1 in revenue for their last financial year of which $11m1 is classified as revenue from overseas sources. 2491 full time equivalent employees are collectively working within these 177 ventures.

OVERALL MEASURE

TARGET

RESULT 2015/16

RESULT 2014/15

Creative HQs alumni ventures1

110

177

116

Collective revenues of alumni ventures1

$21m

$24.6m

$20.7m

Collective revenue of alumni ventures classified as revenues from overseas sources1

$7.5m

$11m

$8.6m

ยน Reported results are based on information gathered from a survey generated by Creative HQ and the provided information cannot be cost effectively substantiated.

21


OUR SPONSORS Our sponsors are crucial in our quest to move the needle for entrepreneurship and innovation in Wellington and beyond. They give Creative HQ the ability to provide the means to our many verticals, programmes and people we run and support to achieve their business goals. They offer enormous support throughout the year and during our programmes, on demo days they provide financial support and cater events, to name a few. This past year Creative HQ have significantly increased their engagement with Deloitte. The partnership began in late 2014, with Deloitte providing general accounting services free of charge. Paul Pettit, Private Partner is Creative HQ’s primary Accountant and now attends the Board Meetings as Financial Advisor. Charlotte Johansen has taken over the end of month reporting which has taken significant workload off the finance team. Deloitte’s ever increasing support to both Creative HQ, their programmes and alumni has been invaluable.

"Creative HQ is the leader in helping innovative new businesses and ways of thinking develop. After seeing the great work they do we were excited to be part of it and do our bit to help Wellington thrive. The benefits of our sponsorship are many. Not only do we get to help the CHQ team with their own accounting, tax and business advice we get to meet and help some great businesses and entrepreneurs. It has been great for our young team to get in at ground level with startups and then our specialist partners are able to assist with strategic advice as the businesses grow. The CHQ base has a wonderful buzz and we can’t keep our team away!" - Paul Pettit, Partner, Deloitte Private

22


Chapman Tripp started supporting Creative HQ in 2014. They have helped Creative HQ reach its goals through financial contribution, countless pro bono or discounted legal services and various mentoring, advisory roles. Josh Blackmore, Geof Shirtcliffe and the rest of the Chapman Tripp team have given immeasurable legal support to the teams in the R9 and Lightning Lab programmes.

"Chapman Tripp is dedicated to playing an active role within the communities in which we work, providing funding, legal skills and time to make a difference. We focus on three themes - youth and education, the arts, and “NZ Inc”. Partnering with Creative HQ is a significant part of the third of these - supporting initiatives to grow and develop New Zealand businesses locally and internationally. And it aligns strongly with our five core values: integrity, people, collaborative, astute and dynamic. There are many benefits to Chapman Tripp from our Creative HQ partnership: we get to work with start-ups and entrepreneurs; our people get the opportunity to work in the fast-paced and creative start-up sector; we get to learn more about the attributes that are important to start-up businesses and how we can better achieve our NZ Inc goals; and we get to enjoy developing personal relationships with Creative HQ team members." – Geof Shirtcliffe, Partner, Chapman Tripp

Paul Spence has been a strong contributor in the startup community since the beginning. His company IWMN came on board to support Creative HQ’s Startup Garage Meetup events in May 2015. IWMN financially cover the Startup Garage catering which comes in the form of top quality soda’s & pizza.

"Community building is fundamental to our core values at iwantmyname. Communities share knowledge, make connections and support fellow entrepreneurs. Startup Garage is one of the largest and most diverse of our innovation ommunities in Wellington and we have been privileged to be part of the journey." - Paul Spence, Co-founder/COO iwantmyname

CityLink began providing networking services in terms of fixed line internet & WiFi to Creative HQ in late 2014. CityLink also contribute services to the various programmes on an ad-hoc basis. They most recently made sure our Lightning Lab XX programme participants were connected throughout the duration of the programme.

23 These notes form an integral part of the Financial Statements.


SUPPORTERS

Creative HQ would like to extend a heartfelt thanks to all of the sponsors, partners and supporters across all of the programmes and initiatives we’ve run or been apart of over the course of 2015-16.

24


ANNUAL REPORT

25 These notes form an integral part of the Financial Statements.


CREATIVE HQ LIMITED DIRECTORS’ REPORT The Board of Directors present their annual report including financial statements of the Company for year ended 30 June 2016.

Total comprehensive revenue or expenses Equity at beginning of the year Equity at 30 June 2016

Actual

Actual

2016

2015

$

$

8,504

548,074

1,408,209

860, 135

1,416,713

1,408,209

Nature of Business The business of the Company is economic development of the Wellington region. The nature of the Company’s business has not changed during the year under review. Use of Company Information The Board received no notices during the year from directors requesting to use company information received in their capacity as directors which would not have otherwise been available to them. Share Dealings No director acquired or disposed of any interest in shares in the Company during the year.

Dividends The Directors recommend that no dividend be paid for the year. Transfers It is not proposed to make any transfer to reserves.

Indemnities The Company has entered into indemnity and insurance in respect of any liability that the directors may incur in their capacity as directors.

State of Affairs The state of the Company’s affairs at 30 June 2016:

Assets Totalled

As required by section 211 of the Companies Act 1993, we disclose the following information:

Actual

Actual

2016

2015

$

$

2,096,308

1,987,452

1,416,713

1,408,209

679,595

579,243

2,096,308

1,987,452

Financed By: Total Equity Liabilities

26


STATEMENT OF RESPONSIBILITY We are responsible for the preparation of Creative HQ’s financial statements and statement of performance, and for the judgements made in them. We are responsible for any end-of-year performance information provided by Creative HQ under section 19A of the Public Finance Act 1989. We have the responsibility for establishing and maintaining a system of internal control designed to provide reasonable assurance as to the integrity and reliability of financial reporting. In our opinion, these financial statements and statement of performance fairly reflect the financial position and operation of Creative HQ for the year ended 30 June 2016.

Barry Brook Susan Reynolds Chairman Director 29 September 2016 29 September 2016

27 These notes form an integral part of the Financial Statements.


CREATIVE HQ LIMITED STATEMENT OF COMPREHENSIVE REVENUE AND EXPENSE FOR THE YEAR ENDED 30 JUNE 2016 Notes

Actual

Budget

Actual

2016

2016

$

$

Actual

Budget

Actual

2015

2016

2016

2015

$

$

$

$

(18,097)

-

602,229

Total other comprehensive revenue and expense

8,504

-

548,074

Total comprehensive revenue and expense

8,504

-

548,074

Revenue 211,459

Grant Revenue MBIE Grant Revenue Callaghan Innovation Grant Revenue WREDA Grant Revenue Wellington City Council Service Revenue Sponsorship Other revenue

3

Total revenue

175,000

Notes

155,513

Other comprehensive revenue and expense Fair value movement of investments

471,750

510,000

512,216

665,000

665,000

700,000

-

100,000

75,000

1,062,610

760,000

654,707

379,441

175,000

81,869

543,508

379,100

34,268

3,333,768

2,764,100

2,213,573

Explanations of major variance against budget are provided in note 21.

Expenditure Personnel costs

4

(1,445,502)

(927,020)

Depreciation and amortisation expense

(28,542)

Directors fees and expenses

(17,230)

(15,108)

(1,864,901)

(1,261,689)

Other expenses

5

Total expenditure Surplus/(Deficit) before tax Tax expense/(benefit) Surplus/(Deficit)

6

2,764,100

(16,242)

(3,356,175)

-

(2,220,059)

(22,407)

-

6,486

(49,008)

-

47,669

26,601

-

(54,155)

28 The accompanying notes form part of these financial statements.


CREATIVE HQ LIMITED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2016 Notes

Actual

Budget

Actual

2016

2016

$

$

Notes

Actual

Budget

Actual

2015

2016

2016

2015

$

$

$

$

(1,339)

-

47,669

Assets

Non-current liabilities

Current assets

Deferred tax liability

6

Cash and cash equivalents

7

244,195

237,000

106,328

Borrowings

-

-

-

Receivables

8

258,614

32,00

307,751

Provisions

-

-

-

Resident withholding tax

6

1,181

-

705

Total non-current liabilities

-

-

-

5,041

-

-

679,595

413,459

579,243

509,031

269,000

414,784

Prepayments Total current assets

Total liabilities

1,416,713 1,408,209 1,408,209

Net assets Non-currents assets Property, plant and equipment Investment in incubator and accelerator companies

9 11

Total non-current assets Total assets

159,870

151,676

171,676

1,427,407 1,400,992 1,400,992 1,587,277

1,552,668

1,572,668

2,096,308

1,821,668

1,987,452

184,746

240,000

230,163

85,250

30,000

39,389

67,294

-

20,811

5,394

10,000

3,668

338,250

133,459

237,543

680,934

413,459

531,574

Equity 97,943

71,342

71,342

Fair value reserve

1,318,770

1,336,867

1,336,867

Total equity

1,416,713 1,408,209 1,408,209

Accumulated surplus/(deficit)

Explanations of major variance against budget are provided in note 21.

Liabilities Current Liabilities Payables Employee entitlements

10

GST payables Creative HQ incubatee bonds Deferred revenue Total current liabilities

13

29 The accompanying notes part of these financial These notes form form an integral part of the Financialstatements. Statements.


CREATIVE HQ LIMITED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2016 Notes

Balance at 1 July Total comprehensive revenue and expenses for the year Balance at 30 June

Actual

Budget

Actual

2016

2016

2015

$

$

$

1,408,209 1,408,209

860,135

8,504

-

548,074

1,416,713 1,408,209 1,408,209

Components of Equity Available for sale reserve 1,336,867

1,336,867

734,638

Other comprehensive revenue and expenses for the year

(18,097)

-

602,229

Balance at 30 June

1,318,770

1,336,867

1,336,867

Balance at 01 July

71,342

71,342

125,497

Net surplus/(deficit) for the year Accumulated comprehensive revenue and expense at 30 June

26,601

-

(54,155)

97,943

71,342

71,342

1,416,713

1,408,209

1,408,209

Balance at 01 July

Accumulated comprehensive revenue and expense

Total Equity

30 The accompanying notes form part of these financial statements.


CREATIVE HQ LIMITED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2016 Notes

Actual

Budget

Actual

2016

2016

$

$

Actual

Budget

Actual

2015

2016

2016

2015

$

$

$

$

137,867

130,672

56,663

106,328

106,328

49,665

244,195

237,000

106,328

Cash flows from operating activities Grant revenue

1,867,354

700,000

1,442,730

Receipts from other revenue

1,566,957

1,500,000

802,481

Payments to suppliers

(1,902,803)

-

(1,173,718)

Payments to employees

(1,399,640) (2,069,328)

(890,302)

Interest received GST Net cash flow from operating activities

12

1,702

-

2,516

46,483

-

10,542

180,053

130,672

194,249

Notes

Net (decrease)/increase in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year

7

Cash flows from investing activities Purchase of investments Receipts from sale of property, plant, and equipment Purchase of property, plant, and equipment

(25,451)

(16,735)

-

(137,586)

Net cash flow from investments

(42,186)

-

(137,586)

-

-

31 The accompanying notes form part of part these financial statements. These notes form an integral of the Financial Statements.


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS 1. REPORTING ENTITY The financial statements presented are for Creative HQ Limited (“the Company”). The Company is a company incorporated in New Zealand under the Companies Act 1993 and is domiciled in New Zealand and operates from Wellington. The Company is wholly owned by Wellington Regional Economic Development Agency (WREDA) and is a Council Controlled Organisation as defined under section 6 of the Local Government Act 2002. The primary objective of the Company is to encourage, promote and support the establishment and growth of business investment and employment opportunities within the region, rather than make a financial return. The registered office of the Company is Level 1, 7 Dixon Street, Te Aro, Wellington New Zealand. The financial statements of the Company are for the year ended 30 June 2016. The financial statements were authorised for issue by the Board on 29 September 2016. 2. STATEMENT OF ACCOUNTING POLICIES 2.1 Basis of preparation The financial statements have been prepared on a going concern basis, and the accounting policies have been applied consistently throughout the period. 2.2 Statement of compliance The financial statements are prepared in accordance with the requirements of the Local Government Act 2002, which includes the requirement to comply with New Zealand Generally Accepted Accounting Practice (NZ GAAP). The financial statements have been prepared in accordance with the requirements of the Companies Act 1993. The financial statements have been prepared in accordance with Tier 2 PBE Standards and disclosure concessions have been applied. Creative HQ meets the requirements for Tier 2 PBE accounting standards as its expenses are less than $30 million, but greater than $2 million and is not defined as publicly accountable in accordance with the new PBE accounting standards.

These financial statements comply with PBE Standards. These financial statements are the first financial statements presented in accordance with the new Public Benefit Entity accounting standards. There are no material adjustments arising on transition to the new PBE accounting standards. 2.3 Basis of measurement The financial statements have been prepared on an historical cost basis, except for certain financial assets and liabilities that have been measured at fair value. Functional and presentation currency The financial statements are presented in New Zealand dollars ($). This is the functional currency. 2.4 Revenue Revenue is measured at the fair value of consideration received. Wellington Regional Economic Development Agency (WREDA) WREDA contributions are recognised as revenue upon entitlement as conditions pertaining to eligible expenditure have been fulfilled. Grants Grant revenue is recognised on entitlement as conditions pertaining to eligible expenditure or milestones are achieved. Sponsorship Revenue is received from third parties to partly cover the costs of running the Company’s programmes and projects. Sponsors were linked to the programme and recognised in all promotions associated with the activity they sponsored. Sponsorship is recognised when measurable and probable of future economic benefits being received.

These notes form an integral part of the Financial Statements.

32


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS Interest Interest revenue is recorded as it is earned during the year. Service revenue Revenue received from services provided is recognised in proportion to the stage of completion at balance date. Donated goods or services not recognised During the year, Creative HQ received professional accounting services from Deloitte and professional legal services from Chapman Tripp and internet from Citylink at no charge. 2.5 Leases Operating Lease Payments An operating lease is a lease that does not transfer substantially all the risks and rewards incidental to ownership of an asset to the lease. Lease payments under an operating lease are recognised as an expense on a straight-line basis over the lease term. Lease incentive received are recognised in the surplus or deficit as a reduction of rental expense over the lease term. 2.6 Finance Revenue & Expenses Finance revenue comprises interest revenue that is recognised in surplus or deficit. Interest revenue is recognised as it accrues, using the effective interest method. 2.7 Foreign currency transactions Transactions in foreign currencies that are settled in the accounting period are translated into New Zealand dollars (the functional currency) using the spot exchange rates at the dates of the transaction. Transactions in foreign currency that are not settled in the accounting period, resulting in monetary assets and liabilities denominated in foreign currencies at the statement of financial position

date are translated to New Zealand dollars at the foreign exchange rate ruling at that date. Foreign exchange differences arising on transaction are recognised in the surplus or deficit. 2.8 Investments in high growth/incubation and accelerator companies The measurement of financial assets depends on their classification based on the purpose for which financial assets were acquired. Management determines the classification of financial assets at initial recognition. Creative HQ Limited, receives shares from clients involved in its high growth/ incubation programme as part consideration for the services and support provided by Creative HQ and the Lightning Lab to the client. The shares received represent a small proportion of the total equity of the client company. These shares are investments in equity instruments that do not have a quoted market price in an active market and are designated as available for sale. Creative HQ recognises the initial investment in the companies according to the programme the company is involved in, high growth/incubator programme or accelerator programme. Companies in the high growth/incubator programme do not have a value on initial recognition as no external investment has yet occurred and therefore the fair value of the initial investment is valued at nil. Companies in the accelerator programme have initial recognition at fair value through other comprehensive revenue and expense. The valuation of these investments is undertaken by Creative HQ using accepted industry guidelines. The International Private Equity and Venture Capital Valuation guidelines (IPEV) have been accepted as the industry standard valuation guidelines and are based on the principle of ‘fair value’ and are reviewed following any relevant changes in accounting standards or market practices. The IPEV guidelines provide a framework for private equity and venture capital investors to arrive at a fair value for their investments. The IPEV are of the view that compliance with PBE accounting standards can be achieved by following the guidelines.

33 These notes form an integral part of the Financial Statements.


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS IPEV Guidelines recommend that for early stage investments, where it is difficult to assess the future profitability of the company, fair value is generally determined by the price of the most recent investment. This methodology is appropriate until the circumstances of the company change such that an alternative valuation methodology (such as, but not limited to price/earnings analysis or discounted cash flow) is appropriate or there is evidence that the value of the investment should be adjusted. An adjustment is considered necessary where the performance of the investment is significantly below the expectations on which the investment was based, leading to a diminution in value. The level of adjustment can range from nil to 100% of the value. A significant or prolonged decline in fair value of the investment below its cost is considered to be objective evidence of impairment. Where the asset is disposed of or is determined to be impaired, the cumulative gain or loss previously recognised in the fair value reserve is reclassified from equity to profit or loss as a reclassification or adjustment. Any increase in fair value subsequent to an impairment loss is recognised in other comprehensive revenue and accumulated as a separate component of equity in the fair value reserve. As at 30 June 2016 the valuation of Creative HQ’s investments is based on the price of the most recent investment made by external investors, unless there is evidence that the value of the investment should be adjusted as the performance of the investment is significantly below the expectations on which the investment was based, leading to a diminution in value. Creative HQ is reliant on receiving recent investment information from high growth/incubator and accelerator companies directly through yearly information requests. 2.9 Cash and cash equivalents Cash and cash equivalents includes cash on hand, deposits held on call with banks, and other short-term highly liquid investments with original maturities of three months or less. 2.10 Receivables Short-term receivables are recorded at their face value, less any provision for impairment. A receivable is considered impaired when there is evidence that Creative HQ will not be able to collect the amount due. The amount of the impairment is the difference between the carrying amount of the receivables and the present value

of the amounts expected to be collected. 2.11 Investments Bank term deposits Investments in bank term deposits are initially measured at the amount invested. Deposits with banks are initially recorded at the amount paid. If it appears that the carrying amount of the investment will not be recovered, it is written down to the expected recoverable amount. 2.12 Non-current assets held for sale Non-current assets held for sale are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. Non-current assets held for sale are measured at the lower of their carrying amount and fair value less costs to sell. Any impairment losses for write-down of non-current assets held for sale are recognised in the surplus or deficit. Any increases in fair value (less costs to sell) are recognised up to the level of any impairment losses that have been previously recognised. Non-current assets held for sale are not depreciated or amortised while they are classified as held for sale. 2.13 Property, plant and equipment Property, plant and equipment consists of the following asset classes: leasehold improvements, furniture, and office equipment. Assets classes are measured at cost, less accumulated depreciation and impairment losses. Additions The cost of an item of property, plant, and equipment is recognised as an asset only when it is probable that future economic benefits or service potential associated with the item will flow to Creative HQ and the cost of the item can be measured reliably. In most instances, an item of property, plant, and equipment is initially recognised These notes form an integral part of the Financial Statements.

34


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS at its cost. Where an asset is acquired through non-exchange transaction, it is recognised at its fair value as at the date of acquisition. Disposals Gains and losses on disposals are determined by comparing the proceeds with the carrying amount of the asset. Gains and losses on disposals are reported net in the surplus or deficit. When revalued assets are sold, the amounts included in revaluations reserves in respect of those assets are transformed to general funds. Subsequent costs Costs incurred subsequent to initial acquisition are capitalised only when it is probable that future economic benefits or service potential associated with the item will flow to Creative HQ and the cost of the item can be measured reliably. The costs of day-to-day servicing of property, plant, and equipment are recognised in the surplus or deficit as they are incurred. Depreciation Depreciation is provided on a straight-line basis on all property, plant, and equipment other than land, at rates that will write-off the cost (or valuation) of the assets to their estimated residual values over their useful lives. The useful lives and associated depreciation rates of major property, plant, and equipment have been estimated as follows: Computer Hardware 2-3 years Equipment 2-8 years Furniture 4-10 years Office fit out, Leasehold improvements 10 years Leasehold improvements are depreciated over the unexpired period of the lease or the estimated remaining useful lives of the improvements, whichever is the shorter.

2.14 Intangible assets Software acquisition and development Acquired computer software licenses are capitalised on the basis of the costs incurred to acquire and bring to use the specific software. Costs that are directly associated with the development of software for internal use are recognised as an intangible asset. Direct costs include software development, employee costs and an appropriate portion of relevant overheads. Staff training costs are recognised as an expense when incurred. Costs associated with maintaining computer software are recognised as an expense when incurred. Amortisation The carrying value of an intangible asset with a finite life is amortised on a straightline basis over its useful life. Amortisation begins when the asset is available for use and ceases at the date that the asset is derecognised. The amortisation charges for each financial year are recognised in the surplus or deficit. The useful lives and associated amortisation rates of major classes of intangible assets have been estimated as follows:

Acquired computer software

3 years

33.3%

Website Maintenance Costs associated with developing and maintaining the Company’s website are recognised as an expense when incurred. 2.15 Impairment of property, plant, and equipment and intangible assets Creative HQ does not hold any cash-generating assets. Assets are considered cash-generating where their primary objective is to generate a commercial return.

The residual value and useful life of an asset is reviewed, and adjusted if applicable, at each financial year end.

35 These notes form an integral part of the Financial Statements.


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS Non-cash-generating assets

Presentation of employee entitlements

Property, plant, and equipment and intangible assets held as cost that have a finite useful life are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable service amount. The recoverable service amount is the higher of an asset’s fair value less costs to sell and value in use.

Annual leave is classified as a current liability. Non-vested long service leave and retirement gratuities expected to be settled within 12 months of balance date are classified as a current liability. All other employment entitlements are classified as a non-current liability.

Value in use is determined using an approach based on either a depreciated replacement cost approach, restoration cost approach, or a service units approach. The most appropriate approach used to measure value is use depends on the nature of the impairment and availability of information.

Defined contribution schemes

If an asset’s carrying amount exceeds its own recoverable service amount, the asset is regarded as impaired and the carrying amount is written-down to the recoverable amount. The total impairment loss is recognised in the surplus or deficit. The reversal of an impairment loss is recognised in the surplus or deficit. 2.16 Payables Short-term payables are recorded at their face value. 2.17 Employee entitlements Short-term employee entitlements Employee benefits that are due to be settled within 12 months after the end of the period in which the employee renders the related service are measured based on accrued entitlements at current rates of pay. These include salaries and wages accrued up to balance date, annual leave earned but not yet taken at balance date and sick leave. A liability and an expense are recognised for bonuses where there is a contractual obligation or where there is a past practice that has created a constructive obligation and a reliable estimate of the obligation can be made.

2.18 Superannuation schemes

Obligations for contributions to KiwiSaver are accounted for as defined contribution superannuation schemes and are recognised as an expense in the surplus or deficit as incurred. 2.19 Provisions A provision is recognised for future expenditure of uncertain amount or timing when there is a present obligation (either legal or constructive) as a result of a past event, it is probable that an outflow of future economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. 2.20 Equity Equity is measured as the difference between total assets and total liabilities. Equity is disaggregated and classified into the following components, • •

accumulated surplus/(deficit) fair value through other comprehensive revenue and expense reserves.

Fair value through other comprehensive revenue and expense reserves This reserves comprises the cumulative net change of financial assets classified as fair value through other comprehensive revenue and expense. 2.21 Income tax Current Tax Current tax is calculated by reference to the amount of income taxes payable These notes form an integral part of the Financial Statements.

36


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS or receivable in respect of the taxable profit or tax loss for the period, adjusted to any difference between the estimated and actual revenue tax payable in prior periods. It is calculated using tax rates (and tax laws) that have been enacted or substantively enacted at balance date. Current tax for current and prior periods is recognised as a liability or (asset) to the extent that it is unpaid (or refundable). Tax assets and liabilities are offset only when Creative HQ has a legally enforceable right to set off the recognised amounts, and intends to settle on a net basis. Deferred Tax Deferred tax is accounted for using the comprehensive balance sheet liability method in respect of temporary differences arising from the difference between the carrying amounts for assets and liabilities in the financial statements and the corresponding tax base of those items. In principle, deferred tax liabilities are recognised for all tax temporary differences. Deferred tax assets are recognised to the extent that it is probable that sufficient 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 the result of a business combination) which affects neither taxable income not accounting profit. 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 the tax rates (and tax laws) that have been enacted or substantively enacted by reporting date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which Creative HQ 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 there is a legally enforceable right to set off income taxes levied by the same taxation authority and Creative HQ intends to settle its current tax assets and liabilities on a net basis. 2.22 Goods and services tax All items in the financial statements are presented exclusive of GST, except for

receivables and payables, which are presented on a GST-inclusive basis. Where GST is not recoverable as input tax, it is recognised as part of the related asset or expense. The net amount of GST recoverable from, or payable to, the IRD is included as part of receivables or payables in the statement of financial position. The net GST paid to, or received from, the IRD, including the GST relating to investing and financing activities, is classified as a net operating cash flow in the statement of cash flows. Commitments and contingencies are disclosed exclusive of GST. 2.23 Budget figures The budget figures are derived from the statement of performance expectations as approved by the Board at the beginning of the financial year. The budget figures have been prepared in accordance with NZ GAAP, using accounting policies that are consistent with those adopted by the Board in preparing these financial statements 2.24 Critical accounting estimates and assumptions The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an on going basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected. Assumptions on investments are disclosed in note 2.8. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions are continually evaluated and are based on historical experience and other factors including expectations of future events that are believed to be reasonable under the circumstances. In particular, information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amount recognised in the financial statements are described below.

37

These notes form an integral part of the Financial Statements.


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS Estimating useful lives and residual values of property, plants, and equipment At each balance date, the useful lives and residual values of property, plant, and equipment are reviewed. Assessing the appropriateness of useful life and residual estimates of property, plant, and equipment requires a number of factors to be considered such as the physical condition of the asset, expected period of use of the asset by Creative HQ, and expected disposal proceeds from the future sale of asset. An incorrect estimate of the useful life or residual value will affect the depreciation expense recognised in the surplus or deficit, and carrying amount of the asset in the statement of financial position. Creative HQ minimises the risk of this estimation uncertainty by: • • • •

physical inspection of assets asset replacement programs review of second hand market prices for similar assets analysis of prior assets sales

Creative HQ has not made significant changes to past assumptions concerning useful lives and residual values.

Creative HQ has exercised its judgement on the appropriate classification of equipment leases, and has determined a number of lease arrangements are finance leases. Grants received Creative HQ must exercise judgement when recognising grant revenue to determine if conditions of the grant contract have been satisfied. This judgment will be based on the facts and circumstances that are evident for each contract. 3. OTHER REVENUE Actual

Actual

2016

2015

494,145

-

47,600

-

Other revenue

1,763

34,268

Total revenue

543,508

34,268

Funding - Other Sale of incubator shares

2.25 Critical judgments in applying accounting policies Management has exercised the following critical judgements in applying accounting policies: Lease classification Determining whether a lease agreement is a financial lease or an operating lease requires judgement as to whether the agreement transfers substantially all the risks and rewards of ownership to Creative HQ. Judgement is required on various aspects that include, but are not limited to, the fair value of the leased asset, the economic life of the leased asset, whether or not to include renewal options in the lease term, and determining an appropriate discount rate to calculate the present value of the minimum lease payments. Classification as a finance lease means the asset is recognised in the statement of financial position as property, plant, and equipment, whereas for an operating lease no such asset is recognised. These notes form an integral part of the Financial Statements.

38


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS 4. PERSONNEL COSTS Actual

Actual

2016

2015

1,376,826

851,369

Other personnel costs

38,972

55,016

Defined contributions plan employer contributions

29,704

20,635

1,445,502

927,020

Salaries and wages

Total personnel costs

Employee contributions to defined contribution plans are contributions to Kiwisaver.

5. OTHER EXPENSES Actual

Actual

2016

2015

Consultancy

526,805

482,807

Other expenses

545,193

286,034

Premises rental

161,100

141,354

Marketing

62,650

98,149

Technology

280,023

88,350

Staff travel

132,773

54,022

81,187

49,302

Office expenses

14,752

30,340

24,500

16,286

-

-

Impairment to investments

20,413

5,625

Operating lease expense

15,505

9,200

Grants and Business assistance

-

220

Communications

-

-

1,864,901

1,261,689

Occupancy Fees to auditor for financial statement audit Fees to auditor for recovery of overrun

Total other expenses

39 These notes form an integral part of the Financial Statements.


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS 6. INCOME TAX EXPENSE Actual

Actual

2016

2015

(a) Tax expense/(benefit) comprises:

Actual

Actual

2016

2015

-

-

(49,008)

47,669

Resident withholding tax

1,181

705

Income tax refund/(payable)

1,181

705

(Over)/under provision of income tax in previous period Income tax expense

Current tax expense/(income)

-

-

(Over)/under provision of income tax in previous period

-

-

Deferred tax expense/(income) relating to the origination and reversal of temporary differences

(49,008)

47,669

Total income tax expense/(benefit)

(49,008)

47,669

(49,008)

47,669

(49,008)

47,669

(22,407)

(6,486)

(6,274)

(1,816)

(41,453)

(33,246)

-

5,062

(49,008)

-

Current tax

Tax expense/(benefit) is attributable to: Continuing operations

(b) The prima facie income tax expense on pre tax accounting profit from operations reconciles to the income tax expense in the financial statements as follows: Net surplus/(deficit) before tax Income tax expense/(benefit) calculated at 28% Tax effect of: Permanent differences Tax losses not recognised

Previously unrecognised tax losses now recognised or utilised Temporary differences

47,669 -

These notes form an integral part of the Financial Statements.

40


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS 7. CASH AND CASH EQUIVALENTS

6.1 DEFERRED TAX Actual

Actual

Actual

Actual

2016

2015

2016

2015

Cash at bank and on hand

244,195

106,328

Total cash and cash equivalents

244,195

106,328

The balance comprises temporary difference attributable to: 46,103

-

(44,764)

(47,669)

Actual

Actual

(1,339)

(47,669)

2016

2015

Property, plant and equipment

Tax losses

Total

258,614

307,751

-

-

-

-

-

Charged to income

(47,669)

-

(47,669)

Total receivables

258,614

307,751

At 30 June 2015

(47,669)

-

(47,669)

Total receivables comprises: Receivables from the sale of goods and services (exchange transactions) Receivables from grants (non-exchange transactions)

120,581

57,751

138,033

250,000

Actual

Actual

2016

2015

Balance as at 1 July

-

68

Additional provisions made during the year

-

-

Receivables written off during the year

-

(68)

Balance at 30 June

-

-

Tax losses Temporary differences

Movements At 1 July 2014

Movements At 1 July 2015 Charged to income At 30 June 2016

Property, plant and equipment

Tax losses

Total

(47,669)

-

(47,669)

2,905

46,103

49,008

(44,764)

46,103

1,339

Actual

Actual

2016

2015

Unrecognised deferred tax balances

-

-

Tax losses

-

-

Temporary differences

-

-

8. RECEIVABLES

Receivables prior to impairment Less: provision for impairment

Movements in the provision for impairment of receivables are as follows:

41 These notes form an integral part of the Financial Statements.


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS 9. PROPERTY, PLANT AND EQUIPMENT

2016

Cost or Accumulated Net carrying Current year Current year Current year deemed cost depreciation value additions disposals depreciation 01 Jul 2015 01 Jul 2015 01 Jul 2015

Elimination on disposal

Cost or Accumulated deemed cost depreciation 30 Jun 2016 30 Jun 2016

Net carrying value 30 Jun 2016

$

$

$

$

$

$

$

$

$

$

4,747

1,489

3,258

-

-

603

-

4,747

2,092

2,655

165,512

11,808

153,704

3,433

-

16,620

-

168,944

28,428

140,516

27,019

12,305

14,714

13,444

141

11,319

-

38,771

22,072

16,699

197,278

25,602

171,676

16,877

141

28,542

-

212,463

52,593

159,870

Cost or Accumulated Net carrying Current year Current year Current year deemed cost depreciation value additions disposals depreciation 01 Jul 2014 01 Jul 2014 01 Jul 2014

Elimination on disposal

Cost or Accumulated deemed cost depreciation 30 Jun 2015 30 Jun 2015

Net carrying value 30 Jun 2015

Operating assets Equipment Office furniture and fittings Computer hardware Total operating assets

2015

$

$

$

$

$

$

$

$

$

$

1,823

861

962

2,924

-

628

-

4,747

1,489

3,258

41,189

4,013

37,176

124,823

500

7,870

75

165,512

11,808

153,704

16,903

4,711

12,192

10,414

298

7,743

149

27,019

12,304

14,714

59,915

9,585

50,330

138,161

798

16,241

224

197,278

25,602

171,676

Operating assets Equipment Office furniture and fittings Computer hardware Total operating assets

These notes form an integral part of the Financial Statements.

42


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS 10. EMPLOYEE ENTITLEMENTS Actual

Actual

2016

2015

Accrued salaries and wages

41,333

11,027

Annual leave

43,918

28,362

Total current portion

85,251

39,389

Non-current portion

-

-

Total non-current portion

-

-

Current portion

Total employee entitlements

85,251

39,389

11. INVESTMENTS IN INCUBATOR AND ACCELERATOR COMPANIES Actual

Actual

2016

2015

1,400,992

804,388

64,925

-

(20,413)

(5,625)

(18,097)

602,229

1,427,407

1,400,992

Creative HQ invests in unlisted early stage companies. Unlisted investments are generally not publicly traded. As there may be no open market to establish an independent value for certain unlisted investments, there can be no assurance that a determination of fair value for an unlisted investment will be obtainable in the market, or that there will be a market for the unlisted investment. The accounting policy is to recognise such investments both initially and subsequently at fair value following accounting standards. This will be based on information provided by each company using the approach set out in note 2.8. At year end the fair value of its investments has been determined at $1,427,407 (2015: $1,400,992). Notwithstanding the uncertainty of the valuation of the investment, the Board is of the view that the fair values of the unlisted investments in these financial statements represent the best available information. Creative HQ’s exposure to changes in investment value could be material to the financial statements. As Creative HQ is not reliant on the cash flows from the investments, changes in value do not impact the underlying viability of Creative HQ. The Board reviews regular reports from the companies. In the event that an investment will be considered to be impaired it will have a non cash effect on the surplus / (deficit) of Creative HQ.

Non-current assets held for sale Investment in incubator and accelerator companies Opening balance Additions Impairments to investments Movement in fair value of accelerator and incubator companies Total investment in incubator and accelerator companies

43 These notes form an integral part of the Financial Statements.


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS

12. RECONCILIATION OF NET SURPLUS/(DEFICIT) TO NET CASH FLOW FROM OPERATING ACTIVITIES Actual

Actual

2016

2015

26,601

(54,155)

-

-

20,413

5,625

8,126

-

Shares in investments

(47,600)

-

Deferred taxation

(49,008)

47,669

28,542

16,242

(39,527)

69,536

Net Surplus/(deficit) Add/(less) non-cash items Impairment of investments Loss on disposal

Depreciation and amortisation expense Total non-cash items

13. DEFERRED REVENUE

Deferred revenue

Actual

Actual

2016

2015

338,250

237,543

Revenue that spans balance date has been recognised as conditions pertaining to eligible expenditure or milestones have been fulfilled. The balance has been recorded as deferred revenue. 14. CAPITAL COMMITMENTS There were no capital commitments at balance date (2015: Nil) 15. CONTINGENT LIABILITIES

Add/(less) working capital movements (Increase)/decrease in receivables

49,138

121,534

(Increase)/decrease in prepayments

(5,041)

2,000

(43,691)

88,402

(Decrease)/increase in tax

(477)

(704)

(Decrease)/increase in tax

46,483

-

100,707

173,986

Actual

Actual

45,862

36,718

2016

2015

192,979

178,868 158,750

155,156

99,975

228,532

258,725

383,688

(Decrease)/increase in payables

(Decrease)/increase in revenue in advance (Decrease)/increase in employee entitlements Total working capital movements

There were no contingent liabilities at balance date (2015: Nil). 16. OPERATING LEASES AS LESSEE Non-cancellable operating leases

Not later than one year Net cash inflow (outflow) from operating activities

180,053

194,249

Later than one year and not later than five years Total non-cancellable operating leases

These notes form an integral part of the Financial Statements.

44


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS 17. CAPITAL MANAGEMENT

Employee remuneration Actual

Actual

2016

2015

$100,000-$109,999

-

1

$110,000-$119,999

2

1

$120,000-$129,999

1

-

$130,000-$139,999

1

1

$140,000-$149,999

1

-

Board member remuneration

$150,000-$159,999

-

-

$180,000-$189,999

1

The total value of remuneration paid or payable to each Board member during the year was:

-

$190,000-$199,999

1

-

Total employees

6

4

Actual

Actual

2016

2015

13,000

14,000

Full-time equivalent members

3

4.5

Leadership team

-

-

838,378

535,160

4

4

838,048

549,160

The Company’s capital is its equity, which comprises share capital and accumulated comprehensive revenue and expense. Equity is represented by net assets. Total remuneration paid or payable:

18. RELATED PARTY TRANSACTIONS Related party disclosures have not been made for transactions with related parties that are within a normal supplier or client/recipient relationship on terms and conditions no more or less favourable than those that it is reasonable to expect Creative HQ would have adopted in dealing with the party at arm’s length in the same circumstances.

Actual

Actual

2016

2015

-

-

1,000

4,000

-

2,000

Barry Brook

4,000

4,000

Victoria Crone

4,000

2,000

Susan Reynolds

4,000

2,000

13,000

14,000

Gerard Quinn (Chair) Brett Holland Nicholas Lewis (resigned)

Total Board member remuneration

Key management personnel compensation

Directors Remuneration

Remuneration Full-time equivalent members Total key management personnel remuneration

45 These notes form an integral part of the Financial Statements.


CREATIVE HQ LIMITED NOTES TO THE FINANCIAL STATEMENTS 19. FINANCIAL ASSETS AND LIABILITIES

21. EXPLANATION OF MAJOR VARIANCE AGAINST BUDGET Actual

Actual

2016

2015

Statement of comprehensive revenue and expense

Financial Assets Loans and receivables Cash and cash equivalents

244,195

106,328

Trade and other receivables

258,614

307,751

1,181

705

5,041

-

509,031

414,784

Resident withholding tax Prepayments Total loans and receivables Investments held for sale

1,400,992

804,388

64,925

-

Impairments to investments

(20,413)

(5,625)

Movements in fair value of investments

(18,097)

602,299

1,427,407

1,400,992

Trade and other payables

184,746

230,163

Total financial liabilities measured at amortised cost

184,746

230,163

Opening balance Additions – Lightning Lab participants

Total investments

Explanations for major variances from Creative HQ’s budgeted figures in the statement of intent are as follow:

Revenue Creative HQ has increased its core service offerings, Exponential and Lean programmes. As a result of this Creative HQ has sold a significant amount more than what was budgeted for. Expenses Expenses are higher than budgeted due to the increase in services sold, Exponential and Lean programmes. Statement of financial position Receivables were higher than budgeted due to many services being sold in May and June 2016. Programmes were funded prior to year end, with activity spanning two financial periods, increasing deferred revenue compared to budget.

Financial liabilities Financial liabilities measured at amortised cost

20. EVENTS AFTER THE BALANCE DATE There were no significant events after the balance date.

These notes form an integral part of the Financial Statements.

46


INDEPENDENT AUDITORS REPORT

47 These notes form an integral part of the Financial Statements.


48


COMPANY INFORMATION The Company is wholly owned by Wellington Regional Economic Development Agency and is a Council Controlled Organisation as defined under section 6 of the Local Government Act 2002, by virtue of Wellington Regional Economic Development Agency Limited’s right to appoint the Board of Directors. The Register office of the Company is Level 1, 7 Dixon Street, Te Aro, Wellington

ACCOUNTANTS Deloitte Private, Chartered Accountants, Wellington SOLICITORS Chapman Tripp, Wellington

ADDRESS Level 1, 7 Dixon Street PO Box 10 347 Wellington, 6143 New Zealand +64 4 381 4440

AUDITORS Audit New Zealand, Wellington On behalf of the Auditor-General BANKERS ANZ Bank Corporate Banking Division 1 Victoria Street Wellington INSURANCE BROKER AON New Zealand Limited

INCORPORATION Incorporated under the Companies Act 1993. On 21 December 2009 at Wellington, New Zealand Incorporation Number 2376228 IRD Number 103-792-029

49 These notes form an integral part of the Financial Statements.


50

Creative HQ Annual Report - Year Ended June 30, 2016  

Creative HQ Annual Report - Year Ended June 30, 2016

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