GUSHCLOUD PTE. LTD.

Registration Number: 201114278R

FINANCIAL STATEMENTS
Year ended 31 December 2013

This document contains no signatures as it is system-generated from the full set of

Financial Statements filed in XBRL by company with ACRA.

Gushcloud Pte. Ltd. and its Subsidiary

(Incorporated in Singapore. Registration Number: 201114278R)

Annual Report
For the financial year ended 31 December 2013
Gushcloud Pte. Ltd. and its Subsidiary
(Incorporated in Singapore)
Annual Report
For the financial year ended 31 December 2013

Contents
Page
Directors Report

Statement by Directors

Independent Auditors Report

Balance Sheets

Consolidated Statement of Comprehensive Income

Consolidated Statement of Changes in Equity

Consolidated Statement of Cash Flows

10

Notes to the Financial Statements

11

GUSHCLOUD PTE. LTD.

The directors present their report to the members together with the audited financial statements of the Group
for the financial year ended 31 December 2013 and the balance sheet of the Company at 31 December 2013.
Directors
The directors of the Company in office at the date of this report are as follows:
Vincent Ha Kwang Yuen
Althea Lim
Arrangements to enable directors to acquire shares and debentures
Neither at the end of nor at any time during the financial year was the Company a party to any arrangement
whose object was to enable the directors of the Company to acquire benefits by means of the acquisition of
shares in, or debentures of, the Company or any other body corporate.
Directors interests in shares or debentures
According to the register of directors shareholdings, none of the directors holding office at the end of the
financial year had any interest in the shares or debentures of the Company or its related corporations, except
as follows:
Holdings registered
in the name of director
At
At
31.12.2013
1.1.2013
The Company
(No. of ordinary shares)
Vincent Ha Kwang Yuen
Althea Lim

13,565
11,570

11,700
11,570

GUSHCLOUD PTE. LTD.

Directors contractual benefits

Since the end of the previous financial year, no director has received or become entitled to receive a benefit
by reason of a contract made by the Company or a related corporation with the director or with a firm of
which he is a member or with a company in which he has a substantial financial interest, except as disclosed
in the accompanying financial statements and in this report, and except that certain directors receive
remuneration as a result of their employment with related corporations.
Share options
There were no options granted during the financial year to subscribe for unissued shares of the Company.
No shares have been issued during the financial year by virtue of the exercise of options to take up unissued
shares of the Company.
There were no unissued shares of the Company under option at the end of the financial year.

Independent auditor
The independent auditor, WSC Partnership, has expressed its willingness to accept re-appointment.
On behalf of the directors

Vincent Ha Kwang Yuen

Director

Althea Lim
Director

20 June 2014

GUSHCLOUD PTE. LTD.

In the opinion of the directors,

(a)

the balance sheet of the Company and the consolidated financial statements of the Group as set out
on pages 7 to 25 are drawn up so as to give a true and fair view of the state of affairs of the
Company and of the Group as at 31 December 2013 and of the results of the business, changes in
equity and cash flows of the Group for the financial year then ended; and

(b)

at the date of this statement, there are reasonable grounds to believe that the Company will be able
to pay its debts as and when they fall due.

On behalf of the directors

Vincent Ha Kwang Yuen

Director

Althea Lim
Director

20 June 2014

GUSHCLOUD PTE. LTD.

Independent Auditors Report to the members of Gushcloud Pte. Ltd.

and its Subsidiary
Report on the financial statements
We have audited the accompanying financial statements of Gushcloud Pte. Ltd. (the Company) and its
subsidiary (the Group) set out on pages 7 to 25, which comprise the consolidated balance sheet of the
Group and the balance sheet of the Company as at 31 December 2013, the consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated statement of
cash flows of the Group for the financial year then ended, and a summary of significant accounting policies
and other explanatory notes.
Managements Responsibility for the Financial Statements
Management is responsible for the preparation of financial statements that give a true and fair view in
accordance with the provisions of the Singapore Companies Act (the Act) and Singapore Financial
Reporting Standards, and for devising and maintaining a system of internal accounting controls sufficient to
provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition,
that transactions are properly authorised and that they are recorded as necessary to permit the preparation of
true and fair profit and loss accounts and balance sheets and to maintain accountability of assets.
Auditors Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted
our audit in accordance with Singapore Standards on Auditing. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain reasonable assurance as to whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditors judgement, including the assessment of
the risks of material misstatement of the financial statements, whether due to fraud or error. In making those
risk assessments, the auditor considers internal control relevant to the entitys preparation and fair
presentation of the financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entitys internal
control. An audit also includes evaluating the appropriateness of accounting policies used and the
reasonableness of accounting estimates made by management as well as evaluating the overall presentation
of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
qualified audit opinion.

Basis for qualified opinion

a.

Prior years operating expenses and subsidiarys records

In the previous financial year, the Groups accounting records do not provide sufficient evidence
supporting operating expenses amounting to US$186,862 (S$233,444) recorded by Gushcloud, Inc
(the Subsidiary). In addition, certain cost of services paid to third party subcontractors do not
have appropriate supporting evidence such as vendor invoices. There were no other satisfactory
audit procedures that we could have performed to obtain reasonable assurance that the expenses
were properly recorded. As a result, we were unable to determine whether any adjustments would
be required in the balance sheet, the income statement of comprehensive income, the statement of
changes in equity and the cash flow statement for the financial year then ended.

b.

Prior years revenue supported only by Paypal statements

GUSHCLOUD PTE. LTD.

Included in the revenue of the Company for the previous year ended 31 December 2012 was an
amount of $12,865 received via Paypal account. This amount was payments received from
customers who chose to pay through the Companys Paypal account. However, there were no other
supporting documents such as revenue invoice which could provide the source or purpose of such
receipt of funds. Accordingly, we were unable to ascertain the accuracy and existence of this
income.
Our audit opinion on the financial statements for the financial year ended 31 December 2012 was
modified accordingly. Our opinion on the current years financial statements is also modified because
of the possible effect of this matter on the comparability of the current years figures and the
corresponding figures.
Qualified opinion
In our opinion, except for the possible effects on the corresponding figures of matters described in paragraph
above, the consolidated financial statements of the Group and the balance sheet of the Company are properly
drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to
give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2013,
and the results, changes in equity and cash flows of the Group for the financial year ended on that date.

Report on Other Legal and Regulatory Requirements

In our opinion, the accounting and other records required by the Act to be kept by the Company have been
properly kept in accordance with the provisions of the Act.

WSC Partnership
Public Accountants and Chartered Accountants
Singapore, 20 June 2014

GUSHCLOUD PTE. LTD.

Group
Note
ASSETS
Cash and cash equivalents
Trade and other receivables
Total current assets
Property, plant and equipment
Total non-current assets

Total assets
LIABILITIES
Trade and other payables
Convertible loan
Redeemable convertible preference shares
Total current liabilities

6
7
8

NET LIABILITIES
EQUITY
Share capital
Currency translation reserve
Accumulated losses
Total equity

2013
$

2012
$

Company
2013
2012
$
$

16,215
388,013
404,228

9,447
125,968
135,415

16,215
388,013
404,228

439,057
439,057

5,359
5,359

11,360
11,360

5,359
5,359

11,360
11,360

409,587

146,775

409,587

450,417

386,855
100,000
615,000
1,101,855

206,831
100,000
615,000
921,831

386,855
100,000
615,000
1,011,855

206,831
100,000
615,000
921,831

(692,268)

(775,056)

(692,268)

(471,414)

260,000
33,455
(985,723)
(692,268)

260,000
6,883
(1,041,939)
(775,056)

260,000
(952,268)
(692,268)

260,000
(731,414)
(471,414)

GUSHCLOUD PTE. LTD.

Note
Sales
Cost of services
Gross profit
Other income

10

Expenses
- Administrative
- Other operating cost
- Finance

2013
$

2012
$

965,418
(420,565)
544,853

396,005
(363,776)
32,229

160,071

12,822

(431,374)
(216,100)
(1,234)

(763,926)
(270,806)
(2,078)

Profit/(loss) before income tax

11

56,216

(991,759)

Income tax

13

Profit/(loss) after income tax

56,216

(991,759)

Other comprehensive income/(loss) that may be

subsequently reclassified to profit or loss:
- Currency translation differences arising from
consolidation

26,572

6,883

Total comprehensive profit/(loss) for the year

82,788

(984,876)

GUSHCLOUD PTE. LTD.

Currency
translation
reserve
$

Share
capital
$

Note

Accumulated
losses
$

Total
equity
$

2013
Beginning of financial year

260,000

6,883

(1,041,939)

(775,056)

Total comprehensive profit for the year

26,572

56,216

82,788

End of financial year

260,000

33,455

(985,723)

(692,268)

2012
Beginning of financial year

1,000

(50,180)

(49,180)

259,000

259,000

Total comprehensive loss for the year

6,883

(991,759)

(984,876)

End of financial year

260,000

6,883

(1,041,939)

(775,056)

Issue of shares

GUSHCLOUD PTE. LTD.

10

2013
$
Cash flows from operating activities
Profit/(loss) after income tax
Adjustments for:
- Depreciation of property, plant and equipment

2012
$

56,216

(991,759)

8,490
64,706

6,676
(985,083)

Change in working capital

- Trade and other receivables
- Trade and other payables
Cash used in operations

(262,045)
180,024
(17,315)

(96,371)
97,831
(983,623)

Net cash used in operating activities

(17,315)

(983,623)

Cash flows from investing activities

Purchase of property, plant and equipment
Net cash used in investing activities

(2,489)
(2,489)

(18,036)
(18,036)

Cash flows from financing activities

Issuance of shares
Issuance of redeemable convertible preference shares
Proceeds from convertible loan
Net cash provided by financing activities

259,000
615,000
100,000
974,000

Net decrease in cash and cash equivalents

Cash and cash equivalents at beginning of financial year
Effect of currency translation on cash and cash equivalents
Cash and cash equivalents at end of financial year

(19,804)
9,447
26,572
16,215

(27,659)
37,106
9,447

GUSHCLOUD PTE. LTD.

11

These notes form an integral part of and should be read in conjunction with the accompanying financial
statements.
1.

General information
Gushcloud Pte. Ltd. (the Company) is incorporated in Singapore and has its registered office at
625 Lorong 4 Toa Payoh, #05-01 General Magnetics Building, Singapore 319519.
The principal activities of the Company are those relating to advertising.

2.

Going concern
As at 31 December 2013, the Companys total liabilities exceeded its total assets by $692,268
(2012: $775,056). The financial statements have been prepared on a going concern basis
notwithstanding the deficiency in shareholders funds as the shareholders have undertaken to
provide such financial support as necessary to enable the Company to continue its operations for the
foreseeable future.

3.

Significant accounting policies

3.1

Basis of preparation
The financial statements have been prepared in accordance with Singapore Financial Reporting
Standards (FRS). The financial statements have been prepared under the historical cost
convention, except as disclosed in the accounting policies below.
The preparation of these financial statements in conformity with FRS requires management to
exercise its judgement in the process of applying the Groups accounting policies. There are no
significant areas involving a higher degree of judgement or complexity, or areas where estimates
and assumptions are significant to the financial statements.
Interpretations and amendments to published standards effective during the year
During the year, the Company adopted the new or amended FRS and Interpretations to FRS (INT
FRS) that are mandatory for application from that date. Changes to the Companys accounting
policies have been made as required, in accordance with the transitional provisions in the respective
FRS and INT FRS.
The adoption of these new or amended FRS and INT FRS did not result in substantial changes to
the Companys accounting policies and had no material effect on the amounts reported for the
current or prior financial years.

GUSHCLOUD PTE. LTD.

12

3.

Significant accounting policies (continued)

3.2

Group accounting
Subsidiaries
Subsidiaries are entities (including special purpose entities) over which the Group has power to
govern the financial and operating policies, generally accompanied by a shareholding giving rise to
a majority of the voting rights. The existence and effect of potential voting rights that are currently
exercisable or convertible are considered when assessing whether the Group controls another entity.
The purchase method of accounting is used to account for the acquisition of subsidiaries. The cost
of an acquisition is measured as the fair value of the assets given, equity instruments issued or
liabilities incurred or assumed at the dates of exchange, plus costs directly attributable to the
acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a
business combination are measured initially at their fair value on the date of acquisition, irrespective
of the extent of any minority interest.
Subsidiaries are consolidated from the date on which control is transferred to the Group. They are
de-consolidated from the date on which control ceases.
In preparing the consolidated financial statements, transactions, balances and unrealised gains on
transactions between group entities are eliminated. Unrealised losses are also eliminated but
considered an impairment indicator of the assets transferred. Accounting policies of subsidiaries
have been changed where necessary to ensure consistency with the policies adopted by the Group.
Please refer to the paragraph Investments in subsidiaries for the accounting policy on investments
in subsidiaries in the separate financial statements of the Company.

3.3

Currency translation
Functional and presentation currency
Items included in the financial statements of each entity in the Group are measured using the
currency of the primary economic environment in which the entity operates (functional currency).
The financial statements are presented in Singapore Dollars.
Transactions and balances
Transactions in a currency other than the functional currency (foreign currency) are translated into
the functional currency using the exchange rates at the dates of the transactions. Currency
translation differences from the settlement of such transactions and from the translation of monetary
assets and liabilities denominated in foreign currencies at the closing rates at the balance sheet date
are recognised in profit or loss, unless they arise from borrowings in foreign currencies and other
currency instruments designated and qualifying as net investment hedges and net investment in
foreign operations. Those currency translation differences are recognised in the currency translation
reserve in the consolidated financial statements and transferred to profit or loss as part of the gain or
loss on disposal of the foreign operation.

GUSHCLOUD PTE. LTD.

13

3.

Significant accounting policies (continued)

3.3

Currency translation (continued)

Transactions and balances (continued)
Non-monetary items measured at fair values in foreign currencies are translated using the exchange
rates at the date when the fair values are determined.
Translation of Group entities financial statements
The results and financial position of all the Group entities (none of which has the currency of a
hyperinflationary economy) that have a functional currency different from the presentation currency
are translated into the presentation currency as follows:

3.4

(i)

Assets and liabilities are translated at the closing exchange rates at the reporting date;

(ii)

Income and expenses are translated at average exchange rates (unless the average is not a
reasonable approximation of the cumulative effect of the rates prevailing on the transaction
dates, in which case income and expenses are translated using the exchange rates at the
dates of the transactions); and

(iii)

All resulting currency translation differences are recognised in the currency translation
reserve.

Revenue recognition
Sale comprises the fair value of the consideration received or receivable for services rendered in the
ordinary course of the Companys activities. Sales are presented, net of goods and services tax,
rebates and discounts.
Revenue from advertising is recognised when the services are rendered.
Interest income is recognised using the effective interest method.

3.5

Bank balances
Trade and other receivables
Bank balances and trade and other receivables are initially recognised at their fair values plus
transaction costs and subsequently carried at amortised cost using the effective interest method, less
accumulated impairment losses.

GUSHCLOUD PTE. LTD.

14

3.

Significant accounting policies (continued)

3.5

Bank balances
Trade and other receivables (continued)
The Company assesses at each balance sheet date whether there is objective evidence that these
financial assets are impaired and recognises an allowance for impairment when such evidence
exists. Significant financial difficulties of the debtor, probability that the debtor will enter
bankruptcy and default or significant delay in payments are objective evidence that these financial
assets are impaired.
The carrying amount of these assets is reduced through the use of an impairment allowance account
which is calculated as the difference between the carrying amount and the present value of estimated
future cash flows, discounted at the original effective interest rate.
These assets are presented as current assets except for those that are expected to be realised later
than 12 months after the balance sheet which are presented as non-current assets.

3.6

Property, plant and equipment

Property, plant and equipment are recognised at cost less accumulated depreciation and
accumulated impairment losses.
Depreciation is calculated using the straight line method to allocate depreciable amounts over their
estimated useful lives. The estimated useful lives are as follows:
Computer
Renovations
Furniture and fittings

Useful lives
3 years
3 years
3 years

The residual values, estimated useful lives and depreciation method of property, plant and
equipment are reviewed, and adjusted as appropriate, at the end of each reporting period. The
effects of any revision are recognised in profit or loss when the changes arise.
Subsequent expenditure relating to property, plant and equipment that has already been recognised
is added to the carrying amount of the asset only when it is probable that future economic benefits
associated with the item will flow to the Group and the cost of the item can be measured reliably.
All other repair and maintenance expenses are recognised in profit or loss when incurred.
On disposal of an item of property, plant and equipment, the difference between the disposal
proceeds and its carrying amount is recognised in profit or loss. Any amount in revaluation reserve
relating to that asset is transferred to retained profits directly.

GUSHCLOUD PTE. LTD.

15

3.

Significant accounting policies (continued)

3.7

Impairment of non-financial assets

Property, plant and equipment
Investments in subsidiary
Property, plant and equipment and investments in subsidiary are tested for impairment whenever
there is any objective evidence or indication that these assets may be impaired.
For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less
cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not
generate cash inflows that are largely independent of those from other assets. If this is the case, the
recoverable amount is determined for the CGU to which the asset belongs.
If the recoverable amount of the asset (or CGU) is estimated to be less than its carrying amount, the
carrying amount of the asset (or CGU) is reduced to its recoverable amount.
The difference between the carrying amount and recoverable amount is recognised as an impairment
loss profit or loss, unless the asset is carried at revalued amount, in which case, such impairment
loss is treated as a revaluation decrease.
An impairment loss for an asset other than goodwill is reversed if, and only if, there has been a
change in the estimates used to determine the assets recoverable amount since the last impairment
loss was recognised. The carrying amount of this asset is increased to its revised recoverable
amount, provided that this amount does not exceed the carrying amount that would have been
determined (net of any accumulated amortisation or depreciation) had no impairment loss been
recognised for the asset in prior years.
A reversal of impairment loss for an asset other than goodwill is recognised in profit or loss, unless
the asset is carried at revalued amount, in which case, such reversal is treated as a revaluation
increase. However, to the extent that an impairment loss on the same revalued asset was previously
recognised as an expense, a reversal of that impairment is also credited to profit or loss.

GUSHCLOUD PTE. LTD.

16

3.

Significant accounting policies (continued)

3.8

Investments in subsidiary
Investments in subsidiary are carried at cost less accumulated impairment losses in the Companys
balance sheet. On disposal of investments in subsidiary, the difference between disposal proceeds
and the carrying amounts of the investments are recognised in profit or loss.

3.9

Trade and other payables

Trade and other payables are initially recognised at fair value, and subsequently carried at amortised
cost using the effective interest method.

3.10

Cash and cash equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents include
cash on hand, deposits with financial institutions which are subject to an insignificant risk of change
in value, and bank overdrafts. Bank overdrafts are presented as current borrowings on the balance
sheet.

3.11

Operating lease payments

Payments made under operating leases (net of any incentives received from the lessors) are
recognised in profit or loss on a straight-line basis over the period of the lease.
Contingent rents are recognised as an expense in profit or loss when incurred.

3.12

Income taxes
Current income tax is recognised at the amount expected to be paid to or recovered from the tax
authorities.
Deferred income tax is recognised for all temporary differences except when the deferred income
tax arises from the initial recognition of an asset or liability that affects neither accounting nor
taxable profit or loss at the time of the transaction.
Current and deferred income tax is measured using the tax rates and tax laws that have been enacted
or substantively enacted by the balance sheet date, and are recognised as income or expenses in
profit or loss, except to the extent that the tax arises from a transaction which is recognised directly
in equity.

GUSHCLOUD PTE. LTD.

17

3.

Significant accounting policies (continued)

3.13

Fair value estimation of financial assets and liabilities

The fair values of current financial assets and liabilities carried at amortised cost approximate their
carrying amounts.

3.14

Employee compensation
Defined contribution plans
The Groups contributions to defined contribution plans are recognised as employee compensation
expense when the contributions are due, unless they can be capitalised as an asset.

3.15

Borrowings
Convertible loans and redeemable convertible preference shares
Convertible loans and redeemable convertible preference shares which are mandatorily redeemable
on a specific date are classified as liabilities.
The total proceeds from the loans and shares are allocated to the liability component and the equity
component, which are separately presented on the balance sheet.
The liability component is recognised initially at its fair value, determined using a market interest
rate for equivalent non-convertible shares. It is subsequently carried at amortised cost using the
effective interest method until the liability is extinguished on conversion or redemption of the
shares.
The difference between the total proceeds and the liability component is allocated to the conversion
option (equity component), which is presented in equity net of any deferred tax effect. The carrying
amount of the conversion option is not adjusted in subsequent periods. When the conversion option
is exercised, its carrying amount is transferred to the share capital. When the conversion option
lapses, its carrying amount is transferred to retained profits.

3.16

Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of
new ordinary shares are deducted against the share capital account.

GUSHCLOUD PTE. LTD.

18

4.

Trade and other receivables

Group
2013
$
Trade receivables
Non trade amount due from
subsidiary
Deposits

Company
2012
$

2013
$

2012
$

376,853

109,254

376,853

107,991

11,160
388,013

16,714
125,968

11,160
388,013

314,352
16,714
439,057

The non-trade amounts due from subsidiary were unsecured, interest free and repayable on demand.
5.

Property, plant and equipment Group and company

Computers
$

Furniture and
fittings
$

Renovations
$

Total
$

2013
Cost
Beginning of financial year
Additions
End of financial year

1,382
2,489
3,871

11,154
11,154

5,500
5,500

18,036
2,489
20,525

Accumulated depreciation
Beginning of financial year
Depreciation
End of financial year

991
392
1,383

4,081
5,348
9,429

1,604
2,750
4,354

6,676
8,490
15,166

Net book value

End of financial year

2,488

1,725

1,146

5,359

2012
Cost
Beginning of financial year
Additions
End of financial year

1,382
1,382

11,154
11,154

5,500
5,500

18,036
18,036

Accumulated depreciation
Beginning of financial year
Depreciation
End of financial year

991
991

4,081
4,081

1,604
1,604

6,676
6,676

Net book value

End of financial year

391

7,073

3,896

11,360

GUSHCLOUD PTE. LTD.

19

6.

Trade and other payables

Group
2013
$
Trade payables
Accrual of GushAd fees
Accrued operating expenses
Amount due to a related party
Amount due to a former staff

219,822
131,539
5,494
10,000
20,000
386,855

Company
2012
$

26,390
144,842
11,099
4,500
20,000
206,831

2013
$
219,822
131,539
5,494
10,000
20,000
386,855

2012
$
26,390
144,842
11,099
4,500
20,000
206,831

The amounts due to a related party and a former staff are non-trade in nature, unsecured, interest
free, denominated in Singapore Dollar and repayable on demand.
7.

Convertible loan
On 31 October 2012, the Company issued 6% convertible loan denominated in Singapore Dollars
with a nominal value of $100,000. The loan is due for repayment three years from the issue date at
their nominal value of $100,000 or conversion into shares of the Company at the holders option to
US$3 million shares or at a 30% discount to the pre-monies valuation of the next round of financing
to be raised by the Company.
The fair value of the liability component, included in current borrowings, is calculated using a
market interest rate for an equivalent non-convertible bond at the date of issue. The residual amount
representing the value of the equity conversion component, if any, is included in shareholders
equity in other reserves.

8.

Redeemable convertible preference shares

On 2 March 2012, the Company issued 5,000 redeemable convertible preference shares amounting
to US$500,000 (S$615,000) to a third party investor. The shares are redeemable at US$100 per
share or could be converted into ordinary shares amounting to 14.29% of the enlarged issued and
paid share capital of the Company on conversion date. The shares are classified as current
borrowings.

9.

Share capital
The Companys share capital comprises fully paid-up 30,000 (2012: 30,000) ordinary shares with
no par value, amounting to a total of $260,000 (2012: $260,000). Fully paid ordinary shares carry
one vote per share and carry a right to dividends as and when declared by the Company.

10.

Other income
Group
2013
$
Other miscellaneous income
Other Service income
Lisencing Fee
Currency translation gain

25,472
105,800
28,799
160,071

2012
$
7,256
5,566
12,822

GUSHCLOUD PTE. LTD.

20

11.

Expenses by nature
Group
2013
$
Depreciation expenses
Staff cost
Sub-contractor charges
Rental on operating lease

12.

8,490
349,165
110,519
43,124

2012
$
6,676
490,929
100,067

Staff cost
Group
2013
$
Salaries and bonuses
Directors remuneration
Employers contribution to Central Provident Fund
Other

13.

294,046
15,000
39,288
831
349,165

2012
$
390,325
48,970
51,582
52
490,929

Income tax
Income tax expense
Group
2013
$
Tax expense attributable to profit is made up of:
- Current income tax

13.

2012
$
-

Income tax (continued)

The tax expense on profit differs from the theoretical amount that would arise using the Singapore
standard rate of income tax as follows:
Group
2013
$

2012
$

Profit/(loss) before income tax

56,216

(991,759)

Tax calculated at a tax rate of 17%

Effects of:
- Expenses not deductible for tax purposes
- Tax incentive
- Utilisation of previously unrecognised tax losses
- Deferred tax asset not recognised
- Tax losses not recognised
Tax charge

9,557

(168,599)

6,197
(1,552)
(19,704)
155
5,347
-

45,275
123,324
-

GUSHCLOUD PTE. LTD.

21

Deferred income tax assets are recognised to the extent that realisation of the related tax benefits
through future taxable a profit is probable. The Company has unrecognised tax losses of
approximately $193,774 (2012: $700,000) at the balance sheet date which can be carried forward
and used to offset against future taxable income subject to meeting certain statutory requirements.
14.

Operating lease commitments

The Group lease office premise from non-related parties under non-cancellable operating leases.
The future minimum lease payables under non-cancellable operating leases contracted for at the
balance sheet date but not recognised as payables, are as follows:
Group and company
2013
2012
$
$
Not later than one year
Between one and five years

15.

35,000
35,000

60,000
35,000
95,000

Financial risk management

Financial risk factors
The Group is exposed to credit, interest rate and other market risk arising in the normal course of
the Groups business. The Board of Directors is responsible for setting the objectives and
underlying principles of financial risk management for the Group. The management team then
establishes detailed policies such as risk identification and measurement, exposure limits and
hedging strategies.
The Group does not have written risk management policies and guidelines. However, the board of
directors meets periodically to analyse and formulate measures to manage the Groups risks.
Generally, management continually monitors the Groups risk management process to ensure that an
appropriate balance between risk and control is achieved.

(a)

Market risk
(i)

Currency risk
The Companys business operations are not exposed to significant foreign currency risks as
its monetary assets and liabilities are mostly denominated in Singapore dollars.

(ii)

Interest rate risk

The Company does not have significant financial assets or liabilities that are exposed to
interest rate risk.

(b)

Credit risk
Credit risk is the risk of loss that may arise from outstanding financial instruments should a
counterparty defaults its obligations. The Groups exposure toGUSHCLOUD
credit risk arises primarily
from trade
PTE. LTD.
22

and other receivables. For cash at banks, the Group minimise credit risk by dealing exclusively with
financial institutions with high credit ratings.
The Group monitors and manage its credit risk by collecting deposits from customers where
possible. In addition, the Group does not have any concentration of credit risk since its customer
base is much diversified and that there is no singular major debtor who makes up a large percentage
of the Groups receivable at year end.
The maximum exposure to credit risk for each class of financial instruments is the carrying amount
of that class of financial instruments presented on the balance sheet.

15.

Financial risk management (continued)

The Groups major classes of financial assets are bank deposits and trade receivables.
(i)

Financial assets that are neither past due nor impaired

Bank deposits that are neither past due nor impaired are mainly deposits with banks which
have high credit-ratings as determined by international credit-rating agencies. Trade and
other receivables that are neither past due nor impaired are substantially companies with
good collection track records with the Group.

(ii)

Financial assets that are past due and/or impaired

There is no other class of financial assets that is past due and/or impaired.

(c)

Liquidity risk
The table below analyses the Companys financial liabilities grouped into relevant maturity
groupings based on the remaining period from the balance sheet date to the contractual maturity
date. The amounts disclosed in the table are the contractual undiscounted cash flows.
Less than
one year
$

(d)

Group
More than
one year
$

At 31 December 2013
Trade and other payables
Convertible loans
Redeemable convertible preference shares

386,855
100,000
615,000

At 31 December 2012
Trade and other payables
Convertible loans
Redeemable convertible preference shares

206,831
100,000
615,000

Capital risk
Management ensures that the Group is adequately capitalised and maintains an optimal capital
structure by issuing additional debt instruments when necessary.
The Group actively and regularly reviews and manages its capital structure to ensure optimal capital
PTE. LTD. of the
23
structure and shareholders returns, taking into considerationGUSHCLOUD
the future capital requirements

Group and capital efficiency, prevailing and projected profitability, projected operating cash flows,
projected capital expenditures and projected strategic investment opportunities.
The Groups composition of capital is represented by total equity as disclosed on the balance sheet.
The Company is not subject to any externally imposed capital requirements.
15.

Financial risk management (continued)

(e)

Fair value measurements

The Group presents assets and liabilities measured at fair value and classified by level of the
following fair value measurement hierarchy:
(i)
(ii)
(iii)

quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);
inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly (ie as prices) or indirectly (ie derived from prices) (Level 2); and
inputs for the asset or liability that are not based on observable market data (unobservable
inputs) (Level 3).

The carrying value less impairment provision of current financial assets and liabilities approximate
their fair values. There are no other financial assets or liabilities as at 31 December 2013 which
applied fair value measurement.
(f)

Financial instruments by category

The aggregate carrying amounts of loans and receivables and financial liabilities at amortised cost
are as follows:
Group
2013
$
Loans and receivables
Financial liabilities at amortised cost

16.

404,228
1,101,855

2012
$
135,415
921,831

Related party transactions

Key management personnel remuneration is as follows:
Group
2013
$
Directors remuneration
Employers contributions to Central Provident Fund

15,000
5,760
20,760

2012
$
7,800
6,240
14,040

GUSHCLOUD PTE. LTD.

24

17.

New or revised accounting Standards and Interpretations

Below are the mandatory standards, amendments and interpretations to existing standards that have
been published, and are relevant for the Companys accounting periods beginning on or after 1
January 2014 or later periods and which the Company has not early adopted:

Amendments to FRS 110 Consolidated Financial Statements (effective for annual periods
beginning on or after 1 January 2014)

Amendments to FRS 112 Disclosures of Interests in Other Entities (effective for annual
periods beginning on or after 1 January 2014)

The management anticipates that the adoption of the above FRSs, INT FRSs and amendments to
FRS in the future periods will not have a material impact on the financial statements of the
Company in the period of their initial adoption.
18.

Authorisation of financial statements

These financial statements were authorised for issue in accordance with a resolution of the Board of
Directors of Gushcloud Pte. Ltd. and its Subsidiary on 20 June 2014.

GUSHCLOUD PTE. LTD.

25