101.ASX IAW Sept 27 2010 17.39 Full Year Statutory Accounts

INTEGRATEDLEGALHOLDINGSLIMITED
ACN120394194
(ASX:IAW)
FinancialReport
Fortheyearended30June2010
ACN120394194
ContentstoFinancialReport
CorporateInformation.............................................................................................................1
DirectorsReport......................................................................................................................2
AuditorsIndependenceDeclaration.....................................................................................22
CorporateGovernanceStatement.........................................................................................23
ConsolidatedStatementofFinancialPosition.......................................................................32
ConsolidatedStatementofComprehensiveIncome.............................................................33
ConsolidatedStatementofCashFlows.................................................................................34
ConsolidatedStatementofChangesinEquity.......................................................................35
NotestotheFinancialStatements.........................................................................................36
DirectorsDeclaration............................................................................................................93
IndependentAuditReport.....................................................................................................94
ASXAdditionalInformation...................................................................................................96
ACN120394194
CorporateInformation
ABN20120394194
Directors
TheHonJohnDawkins,Chairman
AnneTregonning,NonexecutiveDirector
GraemeFowler,ManagingDirector/ChiefExecutive
CompanySecretary
JeanMarieRudd
Registeredoffice
Level8,WesfarmersHouse
40TheEsplanade
PerthWA6000
Principalplaceofbusiness
HeadOffice
Level22
1MarketStreet
SydneyNSW2000
Tel:(02)82636600
ShareRegister
ComputershareInvestorServicesPtyLimited
Level2
45StGeorgesTerrace
PerthWA6000
Tel:(08)93232000
IntegratedLegalHoldingsLimitedsharesarelistedontheAustralianStockExchange.
Solicitors
TalbotOlivier
ArgyleLawyers
Level8,WesfarmersHouse
Level22
40TheEsplanade
1MarketStreet
PerthWA6000
SydneyNSW2000
Bankers
NationalAustraliaBankLimited
50StGeorgesTerrace
PerthWA6000
Auditor
Ernst&Young
11MountsBayRoad
PerthWA6000
ACN120394194
DirectorsReport
Yourdirectorssubmittheirreportfortheyearended30June2010.
DIRECTORS
The names and details of the Companys directors in office during the financial year and until the
date of this report are as follows. Directors were in office for this entire period unless otherwise
stated.
Names,qualifications,experienceandspecialresponsibilities
TheHonJohnDawkins,AO,B.Ec(NonexecutiveChairman)
MrDawkinswasChairmanofLawCentralfromitsearlybeginningsinMarch2000untilMarch2006.
His other board appointments include Chair of the Archer Exploration Ltd, TVET Australia Ltd and
Sovereign Gold Ltd and Director of M&C Saatchi Direct Pty Ltd. For over 10 years, until 2005, he
served on the board of Sealcorp Holdings, now Asgard Wealth Solutions, and he is a former
chairmanofEldersRuralBankanddirectorofRetailEnergyMarketCompanyLtd.
MrDawkinshasconsultedtoseverallargeAustralianandoverseascompanies,theWorldBankand
the OECD. Until his retirement from politics in 1994 he served as a Minister in the Federal
Governmentfor10yearsandintheHouseofRepresentativesfor18years.
HeisagraduateinEconomicsfromtheUniversityofWesternAustralia,andhehasbeenawarded
honorary doctorates from The University of South Australia and the Queensland University of
Technology.
Duringthepastthreeyears,MrDawkinsservedasadirectorofthefollowinglistedcompanies:
MGMWirelessLtdappointed17August2009*
GeneticTechnologiesLtdappointed24November2004;resigned19November2009
*denotescurrentdirectorship
AnneTregonning,B.Com,FCA,GAICD(NonexecutiveDirector)
MsTregonninghasextensiveexperienceinfinanceandriskmanagementinbothpublicpracticeand
commerce. Senior positions previously held include General Manager Finance and Risk, Wealth
ManagementDivision,StGeorgeBank,DirectorGroupFinance,SealcorpHoldings(now ASGARD
WealthSolutions),andSeniorManagerCorporateBanking,BankWest.
Ms Tregonning is a nonexecutive director of Retail Energy Market Company Ltd and the Breast
Cancer Research Centre Western Australia. She is a past executive director of ASGARD Capital
ManagementLimited,apastStateChairmanoftheInstituteofCharteredAccountantsandmember
ofitsNationalCouncil,andapastdirectorofotherpubliccompanyandnotforprofit/professional
organisations.
Ms Tregonning is a graduate of The University of Western Australia, a Fellow of The Institute of

CharteredAccountantsandgraduateoftheAustralianInstituteofCompanyDirectors.
MsTregonningdidnothaveanydirectorshipsinotherlistedcompaniesduringthepastthreeyears.
ACN120394194
DirectorsReport(continued)
GraemeFowler,B.Bus,CPA,GAICD(ManagingDirector/ChiefExecutive)
Mr Fowler was previously Chief Executive Officer of listed accounting and financial services
consolidator WHK Group Limited. He brings specific experience in the successful consolidation of
professionalservicesfirms.Hespentover15yearsinseniormanagementroleswiththeBTFinancial
GroupincludingGroupChiefFinancialOfficer,ChiefExecutiveOfficerofBTFundsManagementNZ,
and Chief Executive Officer of BT Portfolio Services (including BT Wrap) and has recently been
appointedaNonExecutiveDirectorofCountplusPtyLtd.
Mr Fowler is a business studies graduate of The University of Technology, Sydney, a Certified

PracticingAccountantandagraduateoftheAustralianInstituteofCompanyDirectors.
MrFowlerdidnothaveanydirectorshipsinotherlistedcompaniesduringthepastthreeyears.
Beneficialinterestsinthesharesofthecompanyandrelatedbodiescorporate
Asatthedateofthisreport,thebeneficialinterestsofthedirectorsinthesharesofIntegratedLegal
HoldingsLimitedwere:
Number
of
Ordinary
Shares
JDawkins
ATregonning
GFowler
2,910,282
406,251
4,810,559
COMPANYSECRETARY
JeanMarieRudd,B.Com,CA
Appointed:28August2009
MrsRuddisalsotheChiefFinancialOfficer(CFO)oftheIntegratedLegalHoldingsLimitedgroupof
companies.
Mrs Rudd was previously the Finance Director in Western Australia of national law firm, Minter
Ellison, bringing industryspecific experience to her roles with Integrated Legal Holdings Limited.
Mrs Rudd has over 19 years experience in CFO/Company Secretary roles including senior
managementroleswiththeHeytesburyGroupandThinkSmartLimited.
MrsRuddisagraduateofCurtinUniversity,Perth,andaCharteredAccountant.
DIVIDENDS
On12August2010,thedirectorsdeclaredafullyfrankedfinaldividendof0.50centsperordinary
sharewitharecorddateof15October2010.
PRINCIPALACTIVITIES
TheprincipalactivityoftheentitiesoftheconsolidatedGroupwastheprovisionoflegalservicesand
onlinelegaldocumentservicesinAustralia.
ACN120394194
OPERATINGANDFINANCIALREVIEW
GroupOverview
AdetailedreviewoftheoperationsoftheGroupduringthefinancialyear,itsfinancialpositionand
businessstrategiesandprospectsforfuturefinancialyearsissetoutbelow.
PerformanceIndicators
Management and the Board monitor the Groups overall performance, from the execution of its
strategic plan through to the performance of the Group against operating plans and financial
budgets.
The Board, together with management have identified key performance indicators (KPIs) that are
used to monitor performance. Directors receive the KPIs for review prior to each monthly Board
meetingallowingalldirectorstoactivelymonitortheGroupsperformance.
OperatingResultsfortheYear
Consolidated operating revenues of $23,874,988 were 41% higher than the previous year which
reported $16,946,221 operating revenues. Revenue from ordinary activities increased due to a
combinationoforganicgrowthandthefullyeareffectofnewmemberfirmacquisitions.
Fortheyearended30June2010,theconsolidatedentitygeneratedanetprofitaftertaxof$853,494
comparedtotheyearended30June2009of$593,875,anincreaseof44%.
Earningspersharefortheyearwere1.18centspershare,comparedto0.89centspershareforthe
yearended30June2009,anincreaseof33%.
TheDirectorsadvisethattheyarepleasedwiththefullyearresultsandwiththecontinuedstrategic
and operational progress that has been made during the period towards developing a robust
business model and in positioning the Group for future growth. Further, the results were an
improvedpositionontheyearended 30June2009,theCompanyhaving commenceditsrecovery
fromtheeffectsoftheGlobalFinancialCrisis(GFC).
AfullcommentaryontheresultsforthereportingperiodiscontainedintheASXreleasedated12
August2010.
ShareholderReturns
TheCompanysreturntoshareholdersisasfollows:
2010
2009
Basicanddilutedprofitpershare(cents)
1.18
0.89
ACN120394194
ReviewofFinancialCondition
LiquidityandCapitalResources
The statement of cash flows illustrates that there was an increase in cash flow from operating
activities.Operatingactivitiesresultedinanetcashinflowof$1,448,161(2009:$1,652,745outflow).
Cash flows used for investing activities amounted to $802,129 (2009: $3,909,689) which related
entirelytothenetacquisitionofplantandequipmentduringtheyear(2009:$178,286).
Totalcashinflowsweresupplementedby$766,027(2009:$476,372)receivedtofinanceequipment
acquisitions and annual professional indemnity insurance premiums and $227,000 (2009:
$1,723,000) additional draw down of bank floating bill facilities early in the financial year. These
floatingbillloanswerereducedby$1,000,000inthesecondhalfofthefinancialyear.
Finally, there was a cash outflow of $131,122 (2009: $1,411,065) for the payment of the 2010
interimdividendandnetreceiptsof$1,559,452fromthecapitalraisinginApril/May2010.
ThenettangibleassetbackingoftheGroupwas6.54centspershare(2009:4.89cents)anincrease
of34%.
Assetandcapitalstructure
Netassets
Less:Cashandcashequivalentsnetofoverdrafts
Totalcapitalemployed
CONSOLIDATED
2010
2009
$
$
16,197,914
(1,948,949)
14,248,965
13,862,406
(465,875)
13,396,531
The level of gearing in the Company is within acceptable limits set by the directors given the
implicationsofthebusinessacquisitionsandpaymentoftaxliabilitiesduringtheyear.
Shareissuesduringtheyear
TheCompanyhasissued17,138,488shares(2009:5,807,858shares)duringtheyear:
40,000sharestoemployeesundertheDeferredEmployeesSharePlan(July2009);
353,488sharestoshareholdersunderthedividendreinvestmentplanforthe2010interim
dividend(April2010);
11,100,000sharestoinvestorsunderTranche1and2oftheSharePlacement(AprilandMay
2010);and
5,645,000sharestoshareholdersundertheSharePlacementPlan(April2010).
ACN120394194
RiskManagement
TheGrouptakesaproactiveapproachtoriskmanagement.TheBoardisresponsibleforensuring
thatrisks,andalsoopportunities,areidentifiedonatimelybasisandthattheGroupsobjectivesand
activitiesarealignedwiththerisksandopportunitiesidentifiedbytheBoard.
TheGroupbelievesthatitiscrucialforallBoardmemberstobepartofthisprocess,andassuchthe
Board has not established a separate risk management committee. Instead subcommittees are
convenedasappropriateinresponsetoissuesandrisksidentifiedbytheBoardasawholeandthe
subcommitteefurtherexaminestheissueandreportsbacktotheBoard.
The Board has a number of mechanisms in place to ensure that managements objectives and
activitiesarealignedwiththerisksidentifiedbytheBoard.Theseincludethefollowing:
Implementation of Board approved budget and Board monitoring of progress against

budget,includingtheestablishmentandmonitoringoffinancialKPIs;and
Theestablishmentofcommitteestoreportonspecificbusinessrisks.
SIGNIFICANTCHANGESINTHESTATEOFAFFAIRS
Therewerenosignificantchangesinthestateofaffairsduringtheyearended30June2010.
SIGNIFICANTEVENTSAFTERTHEREPORTINGDATE
Afullyfrankedfinaldividendof0.50centspersharewasdeclaredon12August2010witharecord
dateof15October2010andapaymentdateof5November2010.
LIKELYDEVELOPMENTSANDEXPECTEDRESULTS
IntegratedLegalHoldingsLimitedwillcontinuetoseekgrowthinrevenueandearningsthroughthe
acquisitionofadditionallawfirmsthroughoutAustralia.
ENVIRONMENTALREGULATION
The Groups operationsarenotsubjecttoanysignificant environmental,CommonwealthorState,
regulationsorlaws.
INDEMNIFICATIONANDINSURANCEOFDIRECTORSANDOFFICERS
Each of the directors and secretary of the Company has entered into a deed with the Company
wherebytheCompanyhasprovidedcertaincontractualrightsofaccesstobooksandrecordsofthe
Company to those directors and secretary and to effect and maintain insurance in respect of the
directorsandofficersliabilityandprovidecertainindemnitiestoeachofthedirectors,totheextent
permittedbysection199BoftheCorporationsAct2001.
The Company has put in place Prospectus Insurance and Directors and Officers Liability Insurance.
The contract prohibits the disclosure of the nature of the liability and/or the amount of the
premium.
ACN120394194
DIRECTORSMEETINGS
Thenumberofmeetingsofdirectors(includingmeetingsofcommitteesofdirectors)heldduringthe
yearandthenumberofmeetingsattendedbyeachdirectorwasasfollows:
DirectorsMeetings
AuditCommitteeMeetings
JDawkins
ATregonning
GFowler
Eligibleto
attend
11
11
11
Attended
11
11
11
Eligibleto
attend
6
6
6
Attended
4
6
6
Committeemembership
Asatthedateofthisreport,theCompanyhadanAuditCommitteeoftheBoardofDirectors.
The Audit Committee comprises all members of the Board of Directors and is chaired by Ms
Tregonning.
AUDITORINDEPENDENCEANDNONAUDITSERVICES
AcopyoftheauditorsindependencedeclarationreceivedbytheDirectorsinrelationtotheaudit
fortheyearisprovidedwiththisreportonpage22.
NONAUDITSERVICES
Nonauditserviceswereprovidedbytheentitysauditor,Ernst&Young.Thedirectorsaresatisfied
thattheprovisionofnonauditservicesiscompatiblewiththegeneralstandardofindependencefor
auditors imposed by the Corporations Act 2001. The nature and scope of each type of nonaudit
serviceprovidedmeansthatauditorindependencewasnotcompromised.
Ernst&Youngreceivedorareduetoreceivethefollowingamountsfortheprovisionofnonaudit
services:
Taxcompliance
Taxationservices
CONSOLIDATED
2010
2009
$
$
31,453
18,813
5,500
7,737
36,953
26,550
ACN120394194
REMUNERATIONREPORT(audited)
Thisremunerationreportfortheyearended30June2010outlinestheremunerationarrangements
oftheCompanyandtheGroupinaccordancewiththerequirementsoftheCorporationsAct2001
anditsRegulations.Theinformationhasbeenauditedasrequiredbysection308(3C)oftheAct.
The remuneration report details the remuneration arrangements for key management personnel
(KMP) of the Group who are defined as those persons having authority and responsibility for
planning, directing and controlling the major activities of the Company and the Group, directly or
indirectly, including any director (whether executive or otherwise) of the parent company, and
includesthefiveexecutivesintheParentandtheGroupreceivingthehighestremuneration.
For the purposes of this report, the term executive encompasses the Chief Executive, senior
executivesandthesecretaryoftheParentandtheGroup.
Theremunerationreportispresentedunderthefollowingsections:
1. Individualkeymanagementpersonneldisclosures
2. Boardoversightofremuneration
3. Nonexecutivedirectorremunerationarrangements
4. Executiveremunerationarrangements
5. Companyperformanceandthelinktoremuneration
6. Executivecontractualarrangements
7. Equityinstrumentsdisclosures
1. Individualkeymanagementpersonneldisclosures
DetailsofKMPincludingthetopfiveremuneratedexecutivesoftheParentandtheGroupareset
outbelow:
i) Directors
JDawkins
ATregonning
GFowler
ii) Executives
BTaylor
PBobbin
MDouglass
AIreland
BDavies
JMRudd
Chairman(nonexecutive)
NonExecutiveDirector
ManagingDirector/ChiefExecutive
ManagingPrincipal,TalbotOlivier
ManagingPrincipal,ArgyleLawyers
Principal,ArgyleLawyers
Principal,ArgyleLawyers
ManagingPrincipal,BrettDaviesLawyers
ChiefFinancialOfficer/CompanySecretary
TherewerenochangestoKMPafterthereportingdateandbeforethedatethefinancialreportwas
authorisedforissue.
ACN120394194
REMUNERATIONREPORT(audited)(continued)
2. Boardoversightofremuneration
Remunerationassessmentandapprovalprocess
TheBoardofDirectorsoftheCompanyisresponsiblefordeterminingandreviewingremuneration
arrangementsfortheBoardandexecutives.
TheBoardwillassesstheappropriatenessofthenatureandamountofremunerationofexecutives
on a periodic basis by reference to relevant employment market conditions, with the overall
objectiveofensuringmaximumstakeholderbenefitfromtheretentionofahighperformingdirector
andexecutiveteam.
Remunerationstrategy
The performance of the Company depends upon the quality of its directors and executives. To
prosper,theCompanymustattract,motivateandretainhighlyskilleddirectorsandexecutives(refer
GroupPerformanceonpage15).
Tothisend,theCompanyembodiesthefollowingprinciplesinitsremunerationframework:
Providecompetitiverewardstoattracthighcalibreexecutives;
Linkexecutiverewardtoshareholdervalue;
Haveaportionofexecutiveremunerationatrisk;and
Establishappropriate,demandingperformancehurdlesforvariableexecutiveremuneration.
Remunerationstructure
Inaccordancewithbestpracticecorporategovernance,thestructureofnonexecutivedirectorand
executiveremunerationisseparateanddistinct.
3. Nonexecutivedirectorremunerationarrangements
Remunerationpolicy
TheBoardseekstosetaggregateremunerationatalevelthatprovidestheCompanywiththeability
to attract and retain directors of the highest calibre, whilst incurring a cost that is acceptable to
shareholders.
The amount of aggregate remuneration sought to be approved by shareholders and the fee
structure is reviewed annually against fees paid to nonexecutive directors (NEDs) of comparable
companies. The Board may also consider advice from external consultants when undertaking the
annualreviewprocess.
TheGroupsConstitutionandtheASXListingRulesspecifythattheaggregateremunerationofNEDs
shallbedeterminedfromtimetotimebyageneralmeeting.Thecurrentaggregateremuneration
level for nonexecutive directors, as approved by shareholders, is $250,000 (2009: $250,000) per
annum.
TheBoardwillnotseekanyincreasefortheNEDpoolatthe2010AGM.
ACN120394194
Structure
The remuneration of NEDs consists of directors fees and committee fees. NEDs do not receive
retirementbenefits,nordotheyparticipateinanyincentiveprograms.
EachNEDreceivesabasefeeof$45,000forbeingbothaDirectoroftheCompanyandmemberof
theAuditCommittee.Anadditionalfeeof$45,000isalsopaidiftheDirectoristheChairmanofthe
Boardand$18,000iftheDirectorisachairmanoftheAuditCommittee.
TheremunerationofNEDsforthefinancialyearisdetailedintable1onpage19ofthisreport.
4. Executiveremunerationarrangements
Remunerationlevelsandmix
TheGroupaimstorewardexecutiveswithalevelandmixofremunerationcommensuratewiththeir
positionandresponsibilitieswithintheGroupsoasto:
RewardexecutivesforGroup,subsidiaryandindividualperformanceagainst targetssetby
referencetoappropriatebenchmarks;
Aligntheinterestsofexecutiveswiththoseofshareholders;and
Ensuretotalremunerationiscompetitivebymarketstandards.
Structure
In determining the level and makeup of executive remuneration, the Board engages external
consultantsasneededtoprovideindependentadvice.
The Board has entered into a detailed contract of employment with the Managing Director/Chief
Executiveandotherexecutives.Detailsofthesecontractsareprovidedbelow.
Remunerationmayconsistofthefollowingkeyelements:
Fixedremuneration(basesalaryandsuperannuation)
Variableremuneration:
o Shorttermincentives(STI)
o Long term incentives (LTI) in the form of cash payments or share based payments
(equitysettled)
Fixedremuneration
Objective
FixedremunerationisreviewedannuallybytheBoard.TheprocessconsistsofareviewofCompany,
subsidiaryandindividualperformance,relevantcomparativeremunerationexternallyandinternally
and, where appropriate, external advice on policies and practices. As noted above, the Board has
accesstoexternaladviceindependentofmanagement.
10
ACN120394194
Structure
Executives are given the opportunity to receive their fixed (primary) remuneration in a variety of
formsincludingcashandfringebenefitssuchasparking.Itisintendedthatthemannerofpayment
chosenwillbeoptimalfortherecipientwithoutcreatingunduecostfortheGroup.
Thefixedremunerationcomponentofexecutivesisdetailedintable1onpage19.
Variableremunerationshorttermincentives(STI)
Objective
TheobjectiveoftheSTIprogramistolinktheachievementoftheGroupsoperationaltargetswith
the remuneration received by the executives charged with meeting those targets. The total
potentialSTIavailableissetatalevelsoastoprovidesufficientincentivetotheexecutivetoachieve
theoperationaltargetsandsuchthatthecosttotheGroupisreasonableinthecircumstances.
Structure
The Managing Director/Chief Executive is entitled to a maximum performance bonus of $160,000
(payableincash),subjecttotheachievementofspecificperformancetargetsfortheperiodfrom28
April2009to30June2010(26months).Ifachievementofperformancetargetsisnotsuccessfulby
that date, a lesser amount may be payable at the discretion of the Board, taking into account the
individualcircumstancescontributingtothenonachievementofthosetargets.
Performancetargetsareachievedwhen:
Accumulatedrevenueforthegroupis$40morgreater;and
Earningspersharegrowthof15%orgreaterabovetheforecastearningspershareforthe
2008financialyear.
ThesetargetsaremeasuredusingfinancialreportinginformationandreviewedbytheBoard.
Thetermsandconditionspertainingtothebonusareasfollows:
Both performance targets must be achieved at the same time for satisfaction of
performancecriteria,unlessdeterminedotherwisebytheBoard.
The bonus will vest upon achievement of targets on or before 30 June 2010 (providing
targetsachieved).
Anewbonusstructurewillbenegotiatedfromthetimeofpaymentofthisbonus.
Bonustobepaidincashand/orsharesatthediscretionoftheBoard.
Bonus payable within 30 days of satisfaction of performance criteria, as confirmed by the
Board.
11
ACN120394194
MemberFirmPrincipals
Actual STI payments are granted to subsidiary member firms dependent on the extent to which
specific performance hurdles are met. The STI payments are calculated as a percentage of an
amount by which profitability of a subsidiary exceeds a pre determined profit hurdle for that
subsidiary.
ProfithurdlesareapprovedbytheBoardatthetimeofacquisitionofamemberfirm.
TheSTIpaymentforasubsidiaryisthenallocatedbetweenPrincipalsofthatsubsidiarybasedonpre
determinedkeyperformanceindicators,includingfeeincomeattributabletoeachPrincipal.
STIpaymentsmaybeprepaidasacashbonus,uptoamaximumof40%oftheaccruedbonus,at
quarterly intervals during the financial year subject to satisfaction of member firm KPI targets.
Accruedbonusesthatremainunpaidatyearendaredeliveredasacashbonuswithin10daysafter
thereleaseoftheauditedfinancialstatementseachfinancialyear.
ChiefFinancialOfficer
The Chief Financial Officer is entitled to a maximum performance bonus of $10,000 (assessed and
payableinsixmonthlyinstalments),subjecttotheachievementofspecificperformancetargetsfor
the 12 months ended 31 August 2010. If achievement of performance targets is not successful, a
lesseramountmaybe payableatthediscretionoftheManagingDirector,takingintoaccountthe
individualcircumstancescontributingtononachievementofthosetargets.
Performance targets are achieved upon satisfaction of key deliverables involving the realisation of
budgetednetprofitaftertaxandoperatingcashflowsforthe2010financialyear.
Thosekeydeliverablesrepresentkeydriversfortheshorttermsuccessofthebusinessandprovidea
framework for delivering long term value. Targets are measured using financial reporting
information and nonfinancial assessment by the Managing Director of implemented schemes and
processes.
STIawardsfor2010
AfterconsiderationofperformanceagainstKPIs,theBoarddeterminedthattheamounttobepaid
totheManagingDirector/ChiefExecutivewouldbe$64,000,with60%ofSTIawardsbeingforfeited
duetoperformanceconditionsnotfullymet.Paymentwasaccruedat30June2010andpaidincash
duringAugust2010.
TherewerenoalterationstotheManagingDirectorsSTIbonusplanduringtheyear.
12
ACN120394194
TheManagingDirectorassessestheSTIbonuspaymentsforasubsidiaryforsubsequentallocation
between Principals of that subsidiary based on pre determined key performance indicators,
including fee income attributable to each Principal, which is measured using financial reporting
information.
ThemaximumSTIcashbonusiscalculatedasapercentageofanamountbywhichprofitabilityofa
subsidiaryexceedsapredeterminedprofithurdleforthatsubsidiary.TheminimumSTIcashbonus
payableisnil.
Duringthe2010financialyear,thebonusachievedandvestedforMrTaylor,ManagingPrincipalof
TalbotOlivierwas$44,103(2009:nil),forMrDavies,ManagingPrincipalofBrettDaviesLawyerswas
nil(2009:nil),forMrBobbin,ManagingPrincipalofArgyleLawyerswas$300,000(2009:$17,006),
for Mr Douglass, Principal of Argyle Lawyers was $400,000 (2009: $17,006) and for Mr Ireland,
PrincipalofArgyleLawyerswas$50,000(2009:$17,006).
The bonuses achieved and vested during 2010 will be paid within 10 days after the release of the
2010AnnualReport.
TherehavebeennoalterationstotheSTIbonusplanduringtheyear.
The Managing Director will approve the STI bonus payments for the 12 months ended 31 August
2010.ThemaximumSTIcashbonusis$10,000andtheminimumisnil.Asat30June2010,thishad
notyetbeenassessedandassuch,theawardhadnotyetvested.
$5,400(2009:$nil)ofSTIawardsinrespectofthesixmonthperiodended31August2009vested
duringthe2010financialyearwith10%forfeitedduetoperformanceconditionsnotbeingfullymet.
This was paid in October 2009. The maximum STI cash bonus achievable was $6,000 and the
minimumwasnil.
No STI awards (2009: $4,000) in respect of the six month period ended 28 February 2010 vested
during the 2010 financial year with 100% forfeited due to performance conditions not being fully
met.ThemaximumSTIcashbonusachievablewas$5,000andtheminimumwasnil.
13
ACN120394194
Variableremunerationlongtermincentives(LTI)
TheLTIbenefitsaredeliveredonadiscretionarybasisbytheBoardintheformofordinarysharesin
theCompanyundertheDeferredEmployeesSharePlan.Suchgrantsareonlymadetoexecutives
who are able to influence the generation of shareholder wealth and thus have an impact on the
Groupsperformanceagainsttherelevantlongtermperformancehurdle.
40,000sharesweregrantedtotheChiefFinancialOfficeron1July2009withafairvalueof$0.145
per share on grant date and a total fair value of $5,800. The shares will vest in stages during the
threeyearperiodfromissuedate,ended30June2012,followingthesuccessfulachievementofthe
performance criteria specified below, and provided that the Chief Financial Officer remains in the
employment of the Company for each vesting period. Should the Chief Financial Officer cease
employmentpriortothisdate,unvestedshareswillbeforfeited.
Performancecriteriaattachedtothesharesareasfollows:
100%ofshareswillvestifcumulativegrowthintheCompanysearningspershareoverthe
threeyearsended30June2012is45%ormore;and
Shares will commence vesting after achieving 30% growth in the Companys earnings per
share.50%ofshareswillvestat30%growthinearningspershare,withanadditional5%of
sharesvestingforevery1.5%ofearningspersharegrowthabove30%.
Performancecriteriawillbemeasuredusingfinancialreportinginformation.
At30June2010,nosharesundertheLTIplanhavevested(2009:nil)orwereforfeited(2009:nil).
Executivesharetradingpolicy
TheCompanyhasinplaceasharetradingpolicywhichimposestradingrestrictionsonofficersand
employeesoftheCompanyanditsrelatedentitiesthatareconsideredtobeinpossessionofinside
information.
Executives and Directors are prohibited from using derivatives or hedge instruments or otherwise
enteringintotransactions(includingmarginloans)thatoperateorareintendedtooperatetolimit
theeconomicriskofsecurityholdingsovervestedorunvestedsharesintheCompanywithoutthe
writtenpermissionofthe Board.Thisismonitored bytheCompanySecretaryonamonthlybasis
through review of statements from ComputerShare Investor Services Pty Limited. Furthermore,
executivesandDirectorsarerequiredtodeclaretheirintentiontotradeinsharestotheCompany
Secretary,whichisthenpresentedtotheBoard.
14
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5. Companyperformanceandthelinktoremuneration
IntegratedLegalHoldingsLimitedsremunerationpolicyaimstoconnecttheremunerationreceived
byexecutiveswithearningsandthecreationofshareholderwealth.
GroupperformanceisreflectedinthemovementoftheGroupsearningspershare(EPS)overtime.
ThegraphbelowshowsIntegratedLegalHoldingsLimitedsbasicEPShistorysinceincorporationin
June2006:
10.00
0.00
(10.00)
(20.00)
(30.00)
(40.00)
(50.00)
(60.00)
(70.00)
EPS(cents)
(1)
EPS(cents)
Jun2007 Jun2008
(65.50)
2.66
Jun2009
Jun2010
0.89
1.18
Fortheperiodfromincorporationon26June2006to30June2007
The2007EPSresultof65.50wasaffectedbythevaluationofsharesissuedtofoundationpartners
and supporters at a deemed value of 50 cents per share prior to listing of the Company and
acquisitionoflegalpractices.
The EPS improved in the 2008 financial year after listing in August 2007 and the subsequent
acquisitionoffourlegalpracticesandaninformationtechnologybusiness.
Inthe2009financialyearanumberoffactorsinfluencedthereductionofEPS.Corporateexpenses
increased with the full year effect of the costs of a Managing Director and Chief Financial
Officer/Company Secretary, the foundation member firms required additional investment to take
advantage of the growth opportunities available to them, the prevailing economic conditions
negativelyaffectedrevenues,andthedecisiontowriteoffanumberofageddebtorbalanceswhich
hadbecomeunrecoverableasaresultoftheeconomicenvironment.
The increase in EPS during the 2010 financial year represents the full year effect of prior year
businessacquisitionsandnormalisedtradingactivitiesacrosstheGroupandintheCorporateoffice.
The directors believe that the business model remains strong and the company is on target to
achieveitsobjectives.
15
ACN120394194
6. Executivecontractualarrangements
ThereisanemploymentcontractinplacebetweenMrFowlerandIntegratedLegalHoldingsLimited
forMrFowlersappointmentasManagingDirector/ChiefExecutiveoftheCompany.Thecontract
commenced on 28 April 2008 and continues indefinitely unless terminated according to the
provisionsofthecontract.
Mr Fowler receives fixed remuneration of $272,500 (2009: $272,500) per annum (inclusive of
superannuation).
Underthetermsofthecontract,MrFowlersdutiesinclude,butarenotlimitedto:
ImplementingthebusinessplanasdeterminedbytheCompany;
CarryingoutsuchlawfuldirectionsasgivenbytheCompany;and
Expandinganddevelopingthebusiness.
TheagreementmaybeterminatedwithoutnoticebyIntegratedLegalHoldingsLimitedif:
MrFowlercommitsaseriousbreachoftheagreement;
MrFowlercommitsanyactthatamountstoarepudiationoftheagreement;
MrFowlerengagesinseriousorwilfulmisconduct;or
Itispermittedforanyreasonunderrelevantlegislation.
The agreement may also be terminated by either party with 30 days notice in writing of
termination.
BDaviesManagingPrincipal,BrettDaviesLawyers
MrDavieswasemployedunderatwoyearfixedtermcontract,whichexpiredon12August2009.At
expiry of the original contract, an extension was agreed to 30 June 2010 at which point a new
employmentcontractwasnegotiated.
Mr Davies is paid a salary of $200,000 per annum (inclusive of superannuation), from 1 January
2010, and potentially a bonus paid as an additional salary (the bonus payment is calculated at a
percentage of the amount by which the audited net profit before tax of the Principals law firm
exceedsapredeterminedprofithurdle).
The employment contract can be terminated without notice if the employee commits a serious
breach of any provision of their contract, is unable to or is prohibited from holding a license to
practicelaw,commitsanyactthatamountstorepudiationofthecontractorengagesinseriousand
wilful misconduct. Either party may also terminate the employment contract by giving 28 days
notice.
Mr Davies is also subject to strict confidentiality obligations regarding clients of the legal practice,
andisalsosubjecttosolicitationrestraintsforaperiodofuptotwoyearsaftertermination.
16
ACN120394194
BTaylorManagingPrincipal,TalbotOlivier
Mr Taylor is employed under a four year fixed term contract and continuing thereafter until
terminatedbyeitherpartywithsixmonthsnoticeinwritingoftermination(noticemaynotbegiven
before1January2013,beingsixmonthspriortothecompletionoftheinitialfouryearterm).
Mr Taylor is paid a salary of $400,000 per annum (inclusive of superannuation) and potentially a
bonuspaidasanadditionalsalary(thebonuspaymentiscalculatedasashareoftheTalbotOlivier
bonus pool, being a percentage of the amount by which the audited net profit before tax of the
Principalslawfirmexceedsapredeterminedprofithurdle).
The employment contract may be terminated without notice if the employee commits a serious
breach of any provision of their contract, is unable to or is prohibited from holding a license to
wilfulmisconduct.MrTaylorisalsosubjecttostrictconfidentialityobligationsandsolicitationand
competitionrestraintsforaperiodof12monthsfollowingtermination.
PBobbinManagingPrincipal,ArgyleLawyers
AIrelandandMDouglassPrincipals,ArgyleLawyers
Messrs Bobbin, Ireland and Douglass are employed under a four year fixed term contracts and
continuing thereafter until terminated by either party with six months notice in writing of
termination (notice may not be given before 4 August 2012 for Messrs Bobbin and Ireland and
before13December2012forMrDouglass,beingthreemonthspriortothecompletionoftheinitial
fouryearterm).
Messrs Bobbin, Ireland and Douglass are paid a salary of $410,000 per annum (inclusive of
superannuation) and potentially a bonus paid as an additional salary (the bonus payment is
calculatedatashareoftheArgyleLawyersbonuspool,beingapercentageoftheamountbywhich
theauditednetprofitbeforetaxofthePrincipalslawfirmexceedsapredeterminedprofithurdle).
The employment contracts may be terminated without notice if the employees commit a serious
breachofanyprovisionoftheircontract,areunabletoorareprohibitedfromholdingalicenseto
wilful misconduct. Messrs Bobbin, Ireland and Douglass are also subject to strict confidentiality
obligations and solicitation and competition restraints for a period of 12 months following
termination.
17
ACN120394194
ChiefFinancialOfficer/CompanySecretary
The Chief Financial Officer/Company Secretary has a standard contract. Mrs Rudd receives fixed
remunerationof$160,000(2009:$160,000)perannum(inclusiveofsuperannuation).
TheCompanymayterminatetheemploymentagreementbyprovidingonemonthwrittennoticeor
providingpaymentinlieuofthenoticeperiod(basedonthefixedcomponentofremuneration).The
Companymayterminatethecontractatanytimewithoutnoticeifseriousmisconducthasoccurred.
Whereterminationwithcauseoccurs,theexecutiveisonlyentitledtothatportionofremuneration
thatisfixed,andonlyuptothedateoftermination.
MrsRuddscontractcontainsstandardobligationstoperformthedutiesofanemployeewhichone
wouldexpecttofindinastandardemploymentcontract.
7. Equityinstrumentsdisclosures
Unissuedshares
TheCompanyhasnotissuedanyoptionsduringtheyear.
18
ACN120394194
Remunerationofkeymanagementpersonnel(KMP)andthefivehighestpaidexecutivesoftheCompanyandtheGroup
Table1:Remunerationfortheyearended30June2010
Salary&
Fees
$
Nonexecutivedirectors
JDawkinsChairman
ATregonning
Subtotalnonexecutivedirectors
Executivedirectors
GFowlerManagingDirector/Chief
Executive
Subtotalexecutivedirectors
Otherkeymanagementpersonnel
BTaylorManagingPrincipal,Talbot
Olivier(1)
PBobbinManagingPrincipal,Argyle
Lawyers(1)
MDouglassPrincipal,ArgyleLawyers(1)(2)
AIrelandPrincipal,ArgyleLawyers(1)(2)
BDaviesManagingPrincipal,BrettDavies
Lawyers
JMRuddChiefFinancialOfficer/Company
Secretary
SubtotalotherKMP
Total
Shortterm
Cash
Nonmonetary
Bonus
benefits
$
Other
Post
Employment
Super
annuation
67,000
42,376
109,376
30,000
24,999
54,999
270,833
64,000
24,375
270,833
64,000
385,539
44,103
360,000
300,000
370,000
360,000
129,969
Longterm
LongService
Other
(3)
benefits
Benefits
$
$
Sharebased
Payment
Shares
Total
Performance
related
97,000
67,375
164,375
467,702
0.0%
0.0%
13.7%
9.8%
1,372
107,122
24,375
1,372
107,122
14,461
5,353
467,702
449,456
49,999
665
710,664
42.2%
400,000
50,000
49,999
49,999
11,697
640
665
825,127
460,664
141,686
48.5%
10.9%
0.0%
157,030
5,400
14,312
858
4,685
182,285
3.0%
1,767,026
2,147,235
799,503
863,503
190,467
269,841
8,181
9,553
107,122
4,685
4,685
2,769,862
3,401,939
(1)Cashbonusesof$841,440accruedasat30June2010werepaidinthe2011financialyear.
(2)MrDouglassandMrIrelandbecameGroupexecutivesfrom1July2009.
(3)RelatestotheinterestfreecomponentofloanstoKMP(note27(c)).
19
ACN120394194
Remunerationofkeymanagementpersonnel(KMP)andthethreehighestpaidexecutivesoftheCompanyandtheGroup(1)
Table2:Remunerationfortheperiodended30June2009
Post
Employment
Shortterm
Nonexecutivedirectors
JDawkinsChairman
ATregonning
Subtotalnonexecutivedirectors
Executivedirectors
GFowlerManagingDirector/Chief
Executive
Subtotalexecutivedirectors
Otherkeymanagementpersonnel
BTaylorManagingPrincipal,Talbot
Olivier
PBobbinManagingPrincipal,Argyle
Lawyers(2)(3)
BDaviesManagingPrincipal,Brett
DaviesLawyers
JMRuddChiefFinancial
Officer/CompanySecretary
SubtotalotherKMP
Total
Salary&Fees
CashBonus
Non
monetary
benefits
Sharebased
Payment
Longterm
Other
Super
annuation
LongService
benefits
Other
(4)
Benefits
$
Shares
Total
Performance
related
0.0%
0.0%
0.0%
52,667
1,459
54,126
30,000
50,207
80,207
82,667
51,666
134,333
250,000
22,500
370
50,408
323,278
250,000
22,500
370
50,408
323,278
149,083
14,776
290
179,242
8.4%
216,127
17,006
50,540
357
284,030
0.0%
91,743
8,257
308
100,308
0.0%
143,359
7,833
13,370
190
2,753
167,505
4.7%
600,312
904,438
24,839
24,839
86,943
189,650
1,145
1,515
50,408
2,753
715,992
1,173,603
(1)AllexecutivesoftheGroupandCompanyhavebeendisclosed.
(2)MrBobbinwasappointedasManagingPrincipalofArgyleLawyerson1November2008.
(3)Cashbonusesaccruedat30June2009werepaidtoMrBobbininthe2010financialyear.
(4)RelatestotheinterestfreecomponentofloanstoKMP(note27(c)).
20
ACN120394194
Signedinaccordancewitharesolutionofthedirectors.
GFowler
ManagingDirector
Sydney,27September2010
21
Auditor's Independence Declaration to the Directors of Integrated Legal

Holdings Limited
In relation to our audit of the financial report of Integrated Legal Holdings Limited for the financial year
ended 30 June 2010, to the best of my knowledge and belief, there have been no contraventions of the
auditor independence requirements of the Corporations Act 2001 or any applicable code of professional
conduct.
Ernst & Young
G H Meyerowitz
Partner
Perth
27 September 2010
Liability limited by a scheme approved

under Professional Standards Legislation
GHM:NR:ILH:050
ACN120394194
CorporateGovernanceStatement
The Board of Directors of Integrated Legal Holdings Limited is responsible for the corporate
governanceoftheGrouphavingregardtotheASXCorporateGovernanceCouncil(CGC)published
guidelinesaswellasitscorporategovernanceprincipalsandrecommendations.TheBoardguides
and monitors the business and affairs of Integrated Legal Holdings Limited on behalf of the
shareholdersbywhomtheyareelectedandtowhotheyareaccountable.
ThetablebelowsummarisestheCompanyscompliancewiththeCGCsrecommendations:
Recommendation
Principal1Laysolidfoundationsformanagementandoversight
Comply
Yes/No
ASXListing
Reference/
Rule/CGC
explanation recommendations
1.1
Companiesshouldestablishthefunctionsreservedtothe
Boardandthosedelegatedtoseniorexecutivesanddisclose
thosefunctions.
Yes
ASXCGC1.1
1.2
Companiesshoulddisclosetheprocessforevaluatingthe
performanceofseniorexecutives.
Yes
ASXCGC1.2
1.3
Companiesshouldprovidetheinformationindicatedinthe
guidetoreportingonPrincipal1.
Yes
ASXCGC1.3
Principal2StructuretheBoardtoaddvalue
2.1
AmajorityoftheBoardshouldbeindependentDirectors.
Yes
(a)
ASXCGC2.1
2.2
ThechairshouldbeanindependentDirector.
Yes
(a)
ASXCGC2.2
2.3
Therolesofchairandchiefexecutiveofficer(CEO)shouldnot
beexercisedbythesameindividual.
Yes
ASXCGC2.3
2.4
TheBoardshouldestablishanominationcommittee.
No
(b)
ASXCGC2.4
2.5
Companiesshoulddisclosetheprocessforevaluatingthe
performanceoftheBoard,itscommitteesandindividual
Directors.
Yes
ASXCGC2.5
2.6
Yes
ASXCGC2.6
Principal3Promoteethicalandresponsibledecisionmaking
3.1
Companiesshouldestablishacodeofconductanddisclose
thecodeorasummaryofthecodeasto:
Thepracticesnecessarytomaintainconfidencein
theCompanysintegrity.
Thepracticesnecessarytotakeintoaccounttheir
legalobligationsandthereasonableexpectationsof
theirstakeholders.
Theresponsibilityandaccountabilityofindividuals
forreportingandinvestigatingreportsofunethical
practices.
Yes
ASXCGC3.1
3.2
Companiesshouldestablishapolicyconcerningtradingin
CompanysecuritiesbyDirectors,seniorexecutivesand
employees,anddisclosethepolicyorasummaryofthat
policy.
Yes
ASXCGC3.2
3.3
Yes
ASXCGC3.3
23
ACN120394194
CorporateGovernanceStatement(continued)
Recommendation
Principal4Safeguardintegrityinfinancialreporting
Comply
Yes/No
ASXListing
Reference/
Rule/CGC
4.1
TheBoardshouldestablishanauditcommittee.
Yes
ASXCGC4.1
4.2
Theauditcommitteeshouldbestructuredsothatit:
ConsistsonlyofnonexecutiveDirectors
ConsistsofamajorityofindependentDirectors
Ischairedbyanindependentchair,whoisnotchair
oftheBoard
Hasatleastthreemembers
No
(c)
ASXCGC4.2
ASXLR12.7
4.3
Theauditcommitteeshouldhaveaformalcharter.
Yes
ASXCGC4.3
4.4
Yes
ASXCGC4.4
Principal5Maketimelyandbalanceddisclosure
5.1
Companiesshouldestablishwrittenpoliciesdesignedto
ensurecompliancewithASXListingRuledisclosure
requirementsandtoensureaccountabilityatasenior
executivelevelforthatcomplianceanddisclosethose
policiesorasummaryofthosepolicies.
Yes
ASXCGC5.1
5.2
Yes
ASXCGC5.2
Principal6Respecttherightsofshareholders
6.1
Companiesshoulddesignacommunicationspolicyfor
promotingeffectivecommunicationwithshareholdersand
encouragingtheirparticipationatgeneralmeetingsand
disclosetheirpolicyorasummaryofthatpolicy.
Yes
ASXCGC6.1
6.2
Yes
ASXCGC6.2
Principal7Recogniseandmanagerisk
7.1
Companiesshouldestablishpoliciesfortheoversightand
managementofmaterialbusinessrisksanddisclosea
summaryofthosepolicies.
Yes
ASXCGC7.1
7.2
TheBoardshouldrequiremanagementtodesignand
implementtheriskmanagementandinternalcontrolsystem
tomanagetheCompanysmaterialbusinessrisksandreport
toitonwhetherthoserisksarebeingmanagedeffectively.
TheBoardshoulddisclosethatmanagementhasreportedto
itastotheeffectivenessoftheCompanysmanagementof
thismaterialbusinessrisks.
Yes
ASXCGC7.2
7.3
TheBoardshoulddisclosewhetherithasreceivedassurance
fromtheCEO(orequivalent)andthechieffinancialofficer
(CFO)[orequivalent]thatthedeclarationprovidedin
accordancewithsection295AoftheCorporationsActis
foundedonasoundsystemofriskmanagementandinternal
controlandthatthesystemisoperatingeffectivelyinall
materialrespectsinrelationtofinancialreportingrisks.
Yes
ASXCGC7.3
Yes
ASXCGC7.4
7.4
24
ACN120394194
Recommendation
Principal8Remuneratefairlyandresponsibly
Comply
Yes/No
ASXListing
Reference/
Rule/CGC
8.1
TheBoardshouldestablisharemunerationcommittee.
No
(d)
ASXCGC8.1
8.2
Companiesshouldclearlydistinguishthestructureofnon
executiveDirectorsremunerationfromthatofexecutive
Directorsandseniorexecutives.
Yes
ASXCGC8.2
8.3
Yes
ASXCGC8.3
Integrated Legal Holdings Limiteds corporate governance practices were in place throughout the
yearended30June2010.ThefollowingarereferencenotestothePrincipalRecommendationtable:
a) Whilst both nonexecutive Directors of Integrated Legal Holdings Limited own shares in the
Company,theyareconsideredtobeindependentastheyareindependentofmanagementand
free from any business or other relationship that could materially interfere with or could
reasonably be perceived to materially interfere with the exercise of their unfettered and
independentjudgement.
b) No formal nomination committee or procedures have been adopted for the identification,
appointmentandreviewoftheBoardmembership,buttheBoardiscommittedtoaninformal
assessment process, facilitated by the Chair in consultation with the Companys professional
advisors.
c) The audit committee membership includes an executive Director, being the Managing
Director/Chief Executive. Inclusion of the Managing Director/Chief Executive is required to
satisfytherecommendationthatthecommitteemustconsistofatleastthreemembers.
d) No formal remuneration committee has been appointed. The remuneration of an executive

Director will be decided by the Board, without the affected executive Director participating in
that decisionmaking process. The determination of an executive Directors remuneration will
bemadebytheBoardhavingregardtotheinputsandvaluetotheGroupofthecontributionsby
theexecutiveDirectorinconsultantwiththeCompanysprofessionaladvisors.
The total maximum remuneration of nonexecutive Directors is the subject of a shareholder

resolution in accordance with the Companys constitution, the Corporations Act and the ASX
listingrules,asapplicable.ThedeterminationofnonexecutiveDirectorsremunerationwithin
thatmaximumwillbemadebytheBoardhavingregardtotheinputsandvaluetotheGroupof
therespectivecontributionsbyeachnonexecutiveDirector.
Variouscorporategovernancepracticesarediscussedwithinthisstatement.Forfurtherinformation
on corporate governance policies adopted by Integrated Legal Holdings Limited, refer to The
Companyswebsite:
www.ilh.com.au
25
ACN120394194
Boardfunctions
The Board seeks to identify the expectations of the shareholders, as well as other regulatory and
ethical expectations and obligations. In addition, the Board is responsible for identifying areas of
significantbusinessriskandensuringarrangementsareinplacetoadequatelymanagethoserisks.
To ensure that the Board is well equipped to discharge its responsibilities it has established
guidelinesforthenominationandselectionofdirectorsandfortheoperationoftheBoard.
TheresponsibilityfortheoperationandadministrationoftheGroupisdelegatedbytheBoardtothe
Managing Director/Chief Executive and the executive management team. The Board ensures that
this team is appropriately qualified and experienced to discharge their responsibilities and has in
place procedures to assess the performance of the Managing Director/Chief Executive and the
executivemanagementteam.
Whilst at all times the Board retains full responsibility for guiding and monitoring the Group, in
dischargingitsstewardshipitmakesuseofsubcommittees.Specialistcommitteesareabletofocus
onaparticularresponsibilityandprovideinformedfeedbacktotheBoard.
To this end the Board has established an audit committee. The roles and responsibilities of this
committeearediscussedthroughoutthisCorporateGovernanceStatement.
TheBoardisresponsibleforensuringthatmanagementsobjectivesandactivitiesarealignedwith
theexpectationsandriskidentifiedbytheBoard.TheBoardhasanumberofmechanismsinplace
toensurethisisachievedincluding:
Board approval of a strategic plan designed to meet stakeholders needs and manage
businessrisk;
Ongoingdevelopmentofthestrategicplanandapprovinginitiativesandstrategiesdesigned
toensurethecontinuedgrowthandsuccessoftheentity;and
Implementation of budgets by management and monitoring progress against budget via
the establishment and reporting of both financial and nonfinancial key performance
indicators.
OtherfunctionsreservedtotheBoardinclude:
Approvaloftheannualandhalfyearlyfinancialreports;
Approvingandmonitoringtheprogressofmajorcapitalexpenditure,capital management,
andacquisitionsanddivestitures;
Ensuringthatanysignificantrisksthatariseareidentified,assessed,appropriatelymanaged
andmonitored;and
Reportingtoshareholders.
StructureoftheBoard
Theskills,experienceandexpertiserelevanttothepositionofdirectorheldbyeachdirectorinoffice
at the date of the annual report is included in the Directors Report. Directors of Integrated Legal
HoldingsLimitedareconsideredtobeindependentwhentheyareindependentofmanagementand
free from any business or other relationship that could materially interfere with or could
reasonably be perceived to materially interfere with the exercise of their unfettered and
independentjudgement.
26
ACN120394194
In the context of director independence, 'materiality' is considered from both the Group and
individual director perspective. The determination of materiality requires consideration of both
quantitative and qualitative elements. An item is presumed to be quantitatively immaterial if it is
equaltoorlessthan5%oftheappropriatebaseamount.Itispresumedtobematerial(unlessthere
isqualitativeevidencetothecontrary)ifitisequaltoorgreaterthan10%oftheappropriatebase
amount.
Qualitative factors considered include whether a relationship is strategically important, the

competitive landscape, the nature of the relationship and the contractual or other arrangements
governingitandotherfactorsthatpointtotheactualabilityofthedirectorinquestiontoshapethe
directionoftheGroupsloyalty.
In accordance with the definition of independence above, and the materiality thresholds set, the
followingdirectorsofIntegratedLegalHoldingsLimitedareconsideredtobeindependent:
Name
Position
JDawkins
Chairman,NonexecutiveDirector
ATregonning
NonexecutiveDirector
TheBoardrecognisestheCorporateGovernanceCouncilsrecommendationsthattheChairshould
beanindependentDirector.
There are procedures in place, agreed by the Board, to enable Directors in furtherance of their
dutiestoseekindependentprofessionaladviceattheCompanysexpense.
TheterminofficeheldbyeachDirectorinofficeatthedateofthisreportisasfollows:
Name
TerminOffice
JDawkins
3years,11months
ATregonning
3years,11months
GFowler
2years,4months
ForadditionaldetailsregardingBoardappointments,pleaserefertoourwebsite:
www.ilh.com.au
Performance
TheperformanceoftheBoardandkeyexecutivesisreviewedregularlyagainstbothmeasurableand
qualitativeindicators.
TheperformancecriteriaagainstwhichDirectorsandexecutivesareassessedarealignedwiththe
financialandnonfinancialobjectivesofIntegratedLegalHoldingsLimited.
Directorswhoseperformanceisconsistentlyunsatisfactorymaybeaskedtoretire.
27
ACN120394194
Tradingpolicy
UndertheCompanysShareTradingPolicyanexecutiveorDirectormustnottradeinanysecurities
oftheCompanyatanytimewhentheyareinpossessionofunpublished,pricesensitiveinformation
inrelationtothosesecurities.
Beforecommencingtotrade,anexecutivemustfirstobtaintheapprovaloftheCompanySecretary
todosoandaDirectormustfirstobtaintheapprovaloftheChairman.
AdditionalrestrictionsontradingintheCompanyssecuritiesapplytoDirectorsoftheCompany,all
executives reporting directly to the Managing Director and any other employees of the Company
considered appropriate by the Managing Director and Company Secretary from time to time
(RestrictedPersons).
RestrictedPersonsareprohibitedfromtradingintheCompanyssecuritieswithintwomonthsofa
halfyear or full year result announcement, being the end of February and the end of August,
respectively.
RestrictedPersonsarepermittedtobuyorsellCompanyshares:
betweentwoand30daysfollowingthereleaseoftheCompanyshalfyearfinancialresults;
and
fromtwodaysafterthereleaseoftheCompanyspreliminaryfullyearfinancialresultsuntil
30daysaftertheCompanysAnnualGeneralMeeting.
In exceptional circumstances clearance may be given for a Restricted Person to sell (but not to
purchase) securities when they would otherwise be prohibited from doing so but not while there
exists any matter which constitutes unpublished pricesensitive information in relation to the
Companyssecurities.
AsrequiredbytheASXlistingrules,theCompanynotifiestheASXofanytransactionconductedby
DirectorsinthesecuritiesoftheCompany.
Auditcommittee
The Board has established an audit committee, which operates under a charter approved by the
Board. It is the Boards responsibility to ensure that an effective internal control framework exists
withintheentity.Thisincludesinternalcontrolstodealwithboththeeffectivenessandefficiencyof
significant business processes, the safeguarding of assets, the maintenance of proper accounting
records,andthereliabilityoffinancialinformationaswellasnonfinancialconsiderationssuchasthe
benchmarkingofoperationalkeyperformanceindicators.TheBoardhasdelegatedresponsibilityfor
establishing and maintaining a framework of internal control and ethical standards to the audit
committee.
The committee also provides the Board with additional assurance regarding the reliability of
financialinformationforinclusioninthefinancialreports.
Themembersoftheauditcommitteeduringtheyearwere:
ATregonningChairman
JDawkins
GFowler
28
ACN120394194
Qualificationsofauditcommitteemembers
The qualifications and experience of the audit committee members are noted in pages 23 of the
AnnualReport.
Risk
The Board has continued its proactive approach to risk management. The identification and
effective management of risk, including calculated risktaking is viewed as an essential part of the
Companysapproachtocreatinglongtermshareholdervalue.
In recognition of this, the Board determines the Companys risk profile and is responsible for
overseeingandapprovingriskmanagementstrategyandpolicies,internalcomplianceandinternal
control.IndoingsotheBoardhastakentheviewthatitiscrucialforallBoardmemberstobeapart
ofthisprocessandassuch,hasnotestablishedaseparateriskmanagementcommittee.
The Board oversees an annual assessment of the effectiveness of risk management and internal
compliance and control. The tasks of undertaking and assessing risk management and internal
controleffectivenessaredelegatedtomanagementthroughtheManagingDirector/ChiefExecutive,
including responsibility for the day to day design and implementation of the Companys risk
managementandinternalcontrolsystem.ManagementreportstotheBoardontheCompanyskey
risksandtheextenttowhichitbelievestheserisksarebeingadequatelymanaged.
The Board has a number of mechanisms in place to ensure that managements objectives and
activities are aligned with the risks identified by the Board. These include the implementation of
Board approved operating plans and budgets and Board monitoring of progress against these
budgets, including the establishment and monitoring of KPIs of both a financial and nonfinancial
nature.
As part of its duties, the Companys management conducts routine reviews with the objective of
providingassuranceon theadequacyoftheCompanysriskframeworkand the completenessand
accuracyofriskreportingbymanagement.
29
ACN120394194
Tothisend,comprehensivepracticesareinplacethataredirectedtowardsachievingthefollowing
objectivesinrelationtotherequirementsofPrincipal7:
EffectiveandefficientuseoftheCompanysresources
Compliancewithapplicablelawsandregulations
Preparationofreliablepublishedfinancialinformation
ChiefExecutiveandCFOcertification
Inaccordancewithsection295AoftheCorporationsAct,theChiefExecutiveandCFOhaveprovided
awrittenstatementtotheBoardthat:
TheirviewprovidedontheCompanysfinancialreportisfoundedonasoundsystemofrisk
management and internal compliance and control which implements the financial policies
adoptedbytheBoard;and
The Companys risk management and internal compliance and control system is operating
effectivelyinallmaterialrespects.
TheBoardagreeswiththeviewsoftheASXonthismatterandnotesthatduetoitsnature,internal
control assurance from the Chief Executive and CFO can only be reasonable rather than absolute.
This is due to such factors as the need for judgement, the use of testing on a sample basis, the
inherent limitations in internal control and because much of the evidence available is persuasive
rather than conclusive and therefore is not and cannot be designed to detect all weaknesses in
controlprocedures.
Remuneration
ItistheCompanysobjectivetoprovidemaximumstakeholderbenefitfromtheretentionofahigh
quality Board and executive team by remunerating directors and key executives fairly and
appropriatelywithreferencetorelevantemploymentmarketconditions.Toassistinachievingthis
objective,theBoardlinksthenatureandamountofexecutivedirectorsandofficersremuneration
totheCompanysfinancialandoperationalperformance.
Theexpectedoutcomesoftheremunerationstructureare:
Retentionandmotivationofkeyexecutives.
AttractionofhighqualitymanagementtotheCompany.
Performance incentives that allow executives to share in the success of Integrated Legal
HoldingsLimited.
For a full discussion of the Companys remuneration philosophy and framework and the
remuneration received by Directors and executives in the current period please refer to the
RemunerationReport,whichiscontainedwithintheDirectorsReport.
Thereisnoschemetoprovideretirementbenefitstononexecutivedirectors.
The Board is responsible for determining and reviewing compensation arrangements for the
Directorsthemselvesandtheexecutiveteam.
30
ACN120394194
Shareholdercommunicationpolicy
Pursuant to Principal 6, Integrated Legal Holdings Limiteds objective is to promote effective
communicationwithitsshareholdersatalltimes.
IntegratedLegalHoldingsLimitediscommittedto:
Ensuring that shareholders and the financial markets are provided with full and timely
information about Integrated Legal Holdings Limiteds activities in a balanced and
understandableway.
Complying with continuous disclosure obligations contained in applicable ASX listing rules
andtheCorporationsAct2001inAustralia.
Communicating effectively with its shareholders and making it easier for shareholders to
communicatewithIntegratedLegalHoldingsLimited.
To promote effective communication with shareholders and encourage effective participation at

generalmeetings,informationiscommunicatedtoshareholders:
ThroughthereleaseofinformationtothemarketviatheASX
ThroughthedistributionoftheannualreportandNoticesofAnnualGeneralMeeting
Throughshareholdermeetingsandinvestorrelationspresentations
Throughlettersandotherformsofcommunicationsdirectlytoshareholders
By posting relevant information on Integrated Legal Holdings Limiteds website
www.ilh.com.au
TheCompanyswebsitewww.ilh.com.auhasadedicatedsectionforthepurposesofpublishingall
importantCompanyinformationandrelevantannouncementsmadetothemarket.
The external auditors are required to attend the Annual General Meeting and are available to
answer any shareholder questions about the conduct of the audit and preparation of the audit
report.
31
ACN120394194
ConsolidatedStatementofFinancialPosition
ASAT30JUNE2010
ASSETS
CurrentAssets
Cashandcashequivalents
Tradeandotherreceivables
Workinprogress
TotalCurrentAssets
NonCurrentAssets
Plantandequipment
Prepayments
Goodwill
Intangibleassets
Deferredtaxassets
Otherassets
TotalNonCurrentAssets
TOTALASSETS
LIABILITIES
CurrentLiabilities
Tradeandotherpayables
Interestbearingloansandborrowings
Incometaxpayable
Provisions
Otherliabilities
TotalCurrentLiabilities
NonCurrentLiabilities
Provisions
Otherliabilities
TotalNonCurrentLiabilities
TOTALLIABILITIES
NETASSETS
EQUITY
IssuedCapital
AccumulatedLosses
Reserves
TOTALEQUITY
Note
11
12
13
14
15
16
8
17
18
19
8
20
21
18
19
20
21
22
23
24
CONSOLIDATED
2010
2009
$
$
2,151,449
600,694
7,538,870
5,616,233
1,353,354
1,370,212
11,043,673
7,587,139
1,181,314
691,360
29,230
63,016
10,470,600
10,372,263
65,340
100,980
101,089
464,147
2,642
2,677
11,850,215
11,694,443
22,893,888
19,281,582
3,317,157
1,738,222
1,573,325
1,244,330
177,524
157,011
687,057
459,466
279,933
200,000
6,034,996
3,799,029
75,107
260,913
1,064,105
197,350
177,620
127,608
378,422
660,978
1,620,147
6,695,974
5,419,176
16,197,914
13,862,406
32,160,426
(16,688,184)
725,672
30,504,813
(16,641,034)
(1,373)
16,197,914
13,862,406
TheaboveConsolidatedStatementofFinancialPositionshouldbereadinconjunctionwiththe
accompanyingnotes.
32
ACN120394194
ConsolidatedStatementofComprehensiveIncome
FORTHEYEARENDED30JUNE2010
Professionalfees
Interestrevenue
Dividendsreceived
Otherrevenue
Totalrevenue
Occupancyexpenses
Salariesandemployeebenefitsexpenses
Depreciationandamortisationexpenses
Advertisingandmarketingexpenses
Administrativeexpenses
Otherexpenses
Financecosts
Sharebasedpaymentsexpense
Impairmentloss
Totalexpenses
Profitbeforeincometax
Incometaxexpense
Profitafterincometax
Note
7(a)
7(b)
7(c)
7(d)
7(e)
CONSOLIDATED
2010
2009
$
$
23,822,676
16,388,522
39,175
158,585
91
85
13,046
399,029
23,874,988
16,946,221
(2,114,280)
(1,619,855)
(16,149,830)
(10,167,466)
(343,759)
(189,496)
(222,928)
(209,481)
(2,889,908)
(2,602,316)
(742,175)
(534,936)
(160,597)
(57,148)
(19,243)
(14,838)
(450,000)
(22,642,720)
(15,845,536)
1,232,268
1,100,685
(378,774)
(506,810)
853,494
593,875
Netprofitfortheyear
853,494
593,875
Othercomprehensiveincome
Netgains/(losses)onavailableforsalefinancialassets
Othercomprehensiveincome/(losses)fortheyear,netoftax
Totalcomprehensiveincomefortheyear
(68)
(68)
853,426
112
112
593,987
1.18
1.18
0.89
0.89
Basicprofitpershare(cents)
Dilutedprofitpershare(cents)
10
10
TheaboveConsolidatedStatementofComprehensiveIncomeshouldbereadinconjunctionwith
theaccompanyingnotes.
33
ACN120394194
ConsolidatedStatementofCashFlows
Cashflowsfromoperatingactivities
Receiptsfromcustomers
Interestreceived
Dividendsreceived
Otherrevenue
Paymentstosuppliersandemployees
Interestandothercostsoffinancepaid
Incometaxreceived/(paid)
Netcashflowsfrom/(usedin)operatingactivities
Cashflowsfrominvestingactivities
Purchaseofplantandequipment
Proceedsfromthedisposalofplantandequipment
Paymentfortheacquisitionofbusinessesnetofcashacquired
Netcashflowsusedininvestingactivities
Cashflowsfromfinancingactivities
Proceedsfromloansreceived
Repaymentofborrowings
Dividendspaid
Proceedsfromissueofshares
Paymentsforshareissueexpenses
Netcashflowsfromfinancingactivities
Netincrease/(decrease)incashheld
Cashandcashequivalentsatthebeginningofthefinancialyear
Cashandcashequivalentsattheendofthefinancialyear
Note
25(a)
11
CONSOLIDATED
2010
2009
$
$
24,249,661
14,744,556
39,175
159,533
57
44
13,046
399,029
(22,800,109)
(15,623,518)
(92,984)
(23,832)
39,315
(1,308,557)
1,448,161
(1,652,745)
(807,265)
(180,612)
5,136
2,326
(3,731,403)
(802,129)
(3,909,689)
993,027
2,199,372
(1,584,315)
(386,764)
(131,122)
(1,411,065)
1,674,510
(115,058)
837,042
401,543
1,483,074
(5,160,891)
465,875
5,626,766
1,948,949
465,875
TheaboveConsolidatedStatementofCashFlowsshouldbereadinconjunctionwiththe
accompanyingnotes.
34
ACN120394194
ConsolidatedStatementofChangesinEquity
CONSOLIDATED
Balanceasat1July2008
Issued
Capital
Accumulated
Losses
Net
Unrealised
Gains/(Losses)
Reserve
29,729,975
(15,823,844)
13,904,646
593,875
112
112
593,987
Othercomprehensiveincome
Totalcomprehensiveincomeforthe
year
Transactionswithownersintheir
capacityasowners
593,875
112
Dividendspaid
(1,411,065)
Balanceasat30June2009
593,875
30,504,813
774,838
Issueofshares
Total
Equity
(1,485)
Profitfortheyear
General
Reserve
(1,411,065)
774,838
(1,373)
13,862,406
(16,641,034)
CONSOLIDATED
Balanceasat1July2009
Issued
Capital
Accumulated
Losses
Net
Unrealised
Gains/(Losses)
Reserve
30,504,813
(16,641,034)
Total
Equity
13,862,406
853,494
(68)
(68)
853,494
(68)
853,426
Profitfortheyear
Othercomprehensiveloss
Totalcomprehensiveincomeforthe
year
Transactionswithownersintheir
capacityasowners
Transfertogeneralreserve
(727,113)
727,113
Dividendspaid
(173,531)
(173,531)
19,243
19,243
Issueofshares
1,716,910
1,716,910
Transactioncostsonissueofshares
Incometaxonitemstakendirectlytoor
transferredfromequity
(115,058)
(115,058)
34,518
34,518
727,113
16,197,914
Sharebasedpayments
32,160,426
853,494
(1,373)
General
Reserve
(16,688,184)
(1,441)
TheaboveConsolidatedStatementofChangesinEquityshouldbereadinconjunctionwiththe
accompanyingnotes.
35
ACN120394194
NotestotheFinancialStatements
1) CORPORATEINFORMATION
ThefinancialreportofIntegratedLegalHoldingsLimited(theCompany)fortheyearended30June
2010wasauthorisedforissueinaccordancewitharesolutionofdirectorson27September2010.
Integrated Legal Holdings Limited (the parent) is a company limited by shares incorporated in
Australia whose shares are publicly traded on the Australian Stock Exchange. The company was
domiciledinAustralia.
The nature of the operations and principal activities of the Group are described in the Directors'
Report.
2) SUMMARYOFSIGNIFICANTACCOUNTINGPOLICIES
Basisofpreparation
The financial report is a general purpose financial report, which has been prepared in accordance
with the requirements of the Corporations Act 2001, Australian Accounting Standards and other
authoritative pronouncements of the Australian Accounting Standards Board. The financial report
has also been prepared on a historical cost basis, except for availableforsale investments, which
havebeenmeasuredatfairvalue.
ThefinancialreportispresentedinAustraliandollars.
a) CompliancewithIFRS
The financial report complies with Australian Accounting Standards and International Financial
ReportingStandards(IFRS)asissuedbytheInternationalAccountingStandardsBoard.
b) Newaccountingstandardsandinterpretations
From 1 July 2009, the Group has adopted all Australian Accounting Standards and Interpretations,
mandatory for annual reporting periods beginning on or after 1 July 2009. Adoption of these
standardsandinterpretationsdidnothaveaneffectonthefinancialpositionorperformanceofthe
Group,exceptforthefollowing:
AASB8OperatingSegments
ThestandardreplacesAASB114SegmentReportingandrequiresamanagementapproach
tobeusedforsegmentreportingandalsoreplacestherequirementtodetermineprimary
(business) and secondary (geographical) reporting segments of the Group. This approach
identifies operating segments by reference to internal reports that are evaluated regularly
bythechiefoperatingdecisionmakerindecidinghowtoallocateresourcesandinassessing
performance. The Group concluded that operating segments determined in accordance
withAASB8arethesameasthebusinesssegmentsreportedunderAASB114.
AASB101PresentationofFinancialStatements(Revised)
The revised statement separates owner and nonowner changes in equity and requires a
statement of comprehensive income to be prepared which discloses all changes in equity
during a period resulting from nonowner transactions. The Group has elected to present
comprehensiveincomeusingthesinglestatementapproach.
36
ACN120394194
NotestotheFinancialStatements
2)SUMMARYOFSIGNIFICANTACCOUNTINGPOLICIES(continued)
AASB3BusinessCombinations(Revised)
The revised AASB 3 applies the acquisition method to account for business combinations.
Underthismethodallpaymentstopurchaseabusinessaretoberecordedatfairvalueat
theacquisitiondate,withcontingentpaymentsclassifiedasdebtsubsequentlyremeasured
through the statement of comprehensive income. There is a choice on an acquisition by
acquisition basis to measure the noncontrolling interest in the acquiree either at the fair
value or at the noncontrolling interests proportionate share of the acquirees net assets.
Acquisitionrelatedcostsareexpensedasincurred.However,thetransitionalprovisionsof
therevisedAASB3allowforcontingentpaymentsinrespectofacquisitionspriorto1July
2009toberemeasuredthroughgoodwill.TheGroupspolicyhasbeenamendedtoreflect
therevisedstandard.
AASB123(Revised)andAASB20076
TherevisedAASB123requirescapitalisationofborrowingcoststhataredirectlyattributable
to the acquisition, construction or production of a qualifying asset. The Groups previous
policy was to expense borrowing costs as they were incurred. In accordance with the
transitionalprovisionsoftheamendedAASB123,theGrouphasadoptedthestandardona
prospective basis. Therefore borrowing costs are capitalised on qualifying assets with a
commencement date on or after 1 July 2009. The Groups accounting policy has been
amendedtoreflecttherevisedstandard.
IAS 27 Consolidated and Separate Financial Statements Cost of an Investment in a

Subsidiary,JointlyControlledEntityorAssociate(Amendments)
ThereareanumberofchangesarisingfromtherevisionofAASB127relatingtochangesin
ownershipinterestinasubsidiarywithoutlossofcontrol,allocationoflossesofasubsidiary
andaccountingforthelossofcontrolofasubsidiary.Specificallyinrelationtoachangein
ownership interest of a subsidiary (that does not result in a loss of control) such a
transaction will be accounted for as an equity transaction. The Group has adopted this
accountingpolicyprospectivelyfrom1July2009.
AASB7FinancialInstruments:Disclosures(revised)
The amended standard requires additional disclosure about fair value measurement and
liquidity risk. Fair value measurements related to all financial instruments recognised and
measuredatfairvaluearetobedisclosedbysourceofinputsusingathreelevelhierarchy,
by class. The amendments also clarify the requirements for liquidity risk disclosures with
respecttoderivativetransactionsandassetsusedforliquiditymanagement.Thefairvalue
measurement disclosures are presented in note 4. The liquidity risk disclosures are not
significantlyimpactedbytheamendmentsandarealsopresentedinnote3.
AustralianAccountingStandardsandInterpretationsthathaverecentlybeenissuedoramendedbut
arenotyeteffectivehavenotbeenadoptedbytheGroupfortheannualreportingperiodended30
June2010.Theseareoutlinedinthefollowingtable.
37
ACN120394194
NotestotheFinancialStatements(continued)
2) SUMMARYOFSIGNIFICANTACCOUNTINGPOLICIES(continued)
b) Newaccountingstandardsandinterpretations(continued)
Reference
AASB20095
Title
FurtherAmendmentsto
AustralianAccountingStandards
arisingfromtheAnnual
ImprovementsProject
[AASB5,8,101,107,117,118,
136&139]
Summary
Application
dateof
standard
ImpactonGroupfinancialreport
Application
datefor
Group
TheamendmentstosomeStandardsresultinaccounting
changesforpresentation,recognitionormeasurement
purposes,whilesomeamendmentsthatrelateto
terminologyandeditorialchangesareexpectedtohaveno
orminimaleffectonaccountingexceptforthefollowing:
1January2010
TheGrouphasnotyetdeterminedtheimpactofthe
amendments,ifany.
1July2010
TheamendmenttoAASB117removesthespecific
guidanceonclassifyinglandasaleasesothatonlythe
generalguidanceremains.Assessinglandleasesbasedon
thegeneralcriteriamayresultinmorelandleasesbeing
classifiedasfinanceleasesandifso,thetypeofassetwhich
istoberecorded(intangiblevs.property,plantand
equipment)needstobedetermined.
TheamendmenttoAASB101stipulatesthatthetermsofa
liabilitythatcouldresult,atanytime,initssettlementby
theissuanceofequityinstrumentsattheoptionofthe
counterpartydonotaffectitsclassification.
TheamendmenttoAASB107explicitlystatesthatonly
expenditurethatresultsinarecognisedassetcanbe
classifiedasacashflowfrominvestingactivities.
TheamendmenttoAASB118providesadditionalguidance
todeterminewhetheranentityisactingasaprincipaloras
anagent.Thefeaturesindicatinganentityisactingasa
principalarewhethertheentity:
hasprimaryresponsibilityforprovidingthe
goodsorservice;
hasinventoryrisk;
hasdiscretioninestablishingprices;
bearsthecreditrisk.
38
ACN120394194
Reference
AASB20095
(cont)
Title
FurtherAmendmentstoAustralian
AccountingStandardsarisingfrom
theAnnualImprovementsProject
[AASB5,8,101,107,117,118,136&
139]
Summary
Application
dateof
standard
TheamendmenttoAASB136clarifiesthatthelargestunit
permittedforallocatinggoodwillacquiredinabusiness
combinationistheoperatingsegment,asdefinedinIFRS8
beforeaggregationforreportingpurposes.
Application
datefor
Group
ThemainchangetoAASB139clarifiesthataprepayment
optionisconsideredcloselyrelatedtothehostcontract
whentheexercisepriceofaprepaymentoption
reimbursesthelenderuptotheapproximatepresentvalue
oflostinterestfortheremainingtermofthehostcontract.
Theotherchangesclarifythescopeexemptionforbusiness
combinationcontractsandprovideclarificationinrelation
toaccountingforcashfl owhedges.
AASB20098
AmendmentstoAustralian
AccountingStandardsGroupCash
settledSharebasedPayment
Transactions[AASB2]
ThisStandardmakesamendmentstoAustralian
AccountingStandardAASB2SharebasedPaymentand
supersedesInterpretation8ScopeofAASB2and
Interpretation11AASB2CroupandTreasuryShare
Transactions.
1January2010
amendments,ifany.
1July2010
Theamendmentsclarifytheaccountingforgroupcash
settledsharebasedpaymenttransactionsintheseparate
orindividualfinancialstatementsoftheentityreceiving
thegoodsorserviceswhentheentityhasnoobligationto
settlethesharebasedpaymenttransaction.
TheamendmentsclarifythescopeofAASB2byrequiring
anentitythatreceivesgoodsorservicesinasharebased
paymentarrangementtoaccountforthosegoodsor
servicesnomatterwhichentityinthegroupsettlesthe
transaction,andnomatterwhetherthetransactionis
settledinsharesorcash.
39
ACN120394194
Reference
AASB200910
Title
AccountingStandardsClassification
ofRightsIssues[AASB132]
Summary
Application
dateof
standard
Application
datefor
Group
Theamendmentprovidesrelieftoentitiesthatissuerights
inacurrencyotherthantheirfunctionalcurrency,from
treatingtherightsasderivativeswithfairvaluechanges
recordedinprofitorloss.Suchrightswillnowbeclassified
asequityinstrumentswhencertainconditionsaremet.
1February2010
amendments,ifany.
1July2010
40
ACN120394194
Reference
AASB9
Title
FinancialInstruments
Summary
AASB9includesrequirementsfortheclassificationand
measurementoffinancialassetsresultingfromthefirst
partofPhase1ofthelASB'sprojecttoreplaceIAS39
FinancialInstruments:RecognitionandMeasurement
(AASB139FinancialInstruments:Recognitionand
Measurement).
Application
dateof
standard
Application
datefor
Group
1January2013
amendments,ifany.
1July2013
Theserequirementsimproveandsimplifytheapproachfor
classificationandmeasurementoffinancialassets
comparedwiththerequirementsofAASB139.Themain
changesfromAASB139aredescribedbelow.
(a)
Financialassetsareclassifiedbasedon(1)the
objectiveoftheentity'sbusinessmodelfor
managingthefinancialassets;(2)thecharacteristics
ofthecontractualcashflows.Thisreplacesthe
numerouscategoriesoffinancialassetsinAASB139,
eachofwhichhaditsownclassificationcriteria.
(b)
AASB9allowsanirrevocableelectiononinitial
recognitiontopresentgainsandlosseson
investmentsinequityinstrumentsthatarenotheld
fortradinginothercomprehensiveincome.
Dividendsinrespectoftheseinvestmentsthatarea
returnoninvestmentcanberecognisedinprofitor
lossandthereisnoimpairmentorrecyclingon
disposaloftheinstrument.
c)
Financialassetscanbedesignatedandmeasuredat
fairvaluethroughprofitorlossatinitialrecognition
ifdoingsoeliminatesorsignificantlyreducesa
measurementorrecognitioninconsistencythat
wouldarisefrommeasuringassetsorliabilities,or
recognisingthegainsandlossesonthem,on
differentbases.
41
ACN120394194
Reference
AASB200911
Title
AASB9
Summary
Application
dateof
standard
Application
datefor
Group
The revised Standard introduces a number of changes to

theaccountingforfinancialassets,themostsignificantof
whichincludes:
1January2013
amendments,ifany.
1July2013
[AASB1,3,4,5,7,101,102,108,112,
118,121,127,128,131,132,136,
139,1023&1038andInterpretations
10&12]
twocategoriesforfinancialassetsbeingamortised
costorfairvalue
removaloftherequirementtoseparate
embeddedderivativesinfinancialassets
strictrequirementstodeterminewhichfinancial
assetscanbeclassifiedasamortisedcostorfair
value.Financialassetscanonlybeclassifiedas
amortisedcostif(a)thecontractualcashflows
fromtheinstrumentrepresentprincipaland
interestand(b)theentity'spurposeforholding
theinstrumentistocollectthecontractualcash
flows
anoptionforinvestmentsinequityinstruments
whicharenotheldfortradingtorecognisefair
valuechangesthroughothercomprehensive
incomewithnoimpairmenttestingandno
recyclingthroughprofitorlossonderecognition
reclassificationsbetweenamortisedcostandfair
valuenolongerpermittedunlesstheentity's
businessmodelforholdingtheassetchanges
changestotheaccountingandadditional
disclosuresforequityinstrumentsclassifiedasfair
valuethroughothercomprehensiveincome
42
ACN120394194
Reference
AASB124
(Revised)
Title
RelatedPartyDisclosures
(December2009)
Summary
TherevisedAASB124simplifiesthedefinitionofarelated
party,clarifyingitsintendedmeaningandeliminating
inconsistenciesfromthedefinition,including:
(a)
thedefinitionnowidentifiesasubsidiaryandan
associatewiththesameinvestorasrelated
partiesofeachother;
(b)
entitiessignificantlyinfluencedbyonepersonand
entitiessignificantlyinfluencedbyaclose
memberofthefamilyofthatpersonareno
longerrelatedpartiesofeachother;and
(c)
thedefinitionnowidentifiesthat,whenevera
personorentityhasbothjointcontrolovera
secondentityandjointcontrolorsignificant
influenceoverathirdparty,thesecondand
thirdentitiesarerelatedtoeachother.
Application
dateof
standard
Application
datefor
Group
1January2011
amendments,ifany.
1July2011
Apartialexemptionisalsoprovidedfromthedisclosure
requirementsforgovernmentrelatedentities.Entities
thatarerelatedbyvirtueofbeingcontrolledbythesame
governmentcanprovidereducedrelatedparty
disclosures.
43
ACN120394194
Reference
AASB200912
AASB20103
Title
Summary
AccountingStandards[AASBs5,8,
108,110,112,119,133,137,139,
1023&1031andInterpretations2,4,
16,1039&1052]
Thisamendmentmakesnumerouseditorialchangestoa
rangeofAustralianAccountingStandardsand
Interpretations.
Limitsthescopeofthemeasurementchoicesofnon
controllinginterestatproportionateshareofnetassetsin
theeventofliquidation.OthercomponentsofNCIare
measuredatfairvalue.
[AASB3,AASB7,AASB121,AASB128,
AASB131,AASB132&AASB139]
Application
dateof
standard
Application
datefor
Group
1January2011
amendments,ifany.
1July2011
1July2010
amendments,ifany.
1July2010
Inparticular,itamendsAASB8OperatingSegmentsto
requireanentitytoexercisejudgementinassessing
whetheragovernmentandentitiesknowntobeunderthe
controlofthatgovernmentareconsideredasingle
customerforthepurposesofcertainoperatingsegment
disclosures.Italsomakesnumerouseditorialamendments
toarangeofAustralianAccountingStandardsand
Interpretations,includingamendmentstoreflectchanges
madetothetextofIFRSsbytheIASB.
Requiresanentity(inabusinesscombination)toaccountfor
thereplacementoftheacquiree'ssharebasedpayment
transactions(whetherobligedorvoluntarily),i.e.,split
betweenconsiderationandpostcombinationexpenses.
Clarifiesthatcontingentconsiderationfromabusiness
combinationthatoccurredbeforetheeffectivedateof
AASB3Revisedisnotrestated.
Eliminatestherequirementtorestatefinancialstatementsfor
areportingperiodwhensignificantinfluenceorjointcontrolis
lostandthereportingentityaccountsfortheremaining
investmentunderAASB139.Thisincludestheeffecton
accumulatedforeignexchangedifferencesonsuch
investments.
44
ACN120394194
Reference
AASB20104
Title
Summary
Application
dateof
standard
Application
datefor
Group
FurtherAmendmentstoAustralian
[AASB1,AASB7,AASB101,AASB134
andInterpretation13]
Emphasisestheinteractionbetweenquantitativeand
qualitativeAASB7disclosuresandthenatureandextentof
risksassociatedwithfinancialinstruments.
1January2011
amendments,ifany.
1July2011
1July2010
amendments,ifany.
1July2010
Clarifiesthatanentitywillpresentananalysisofother
comprehensiveincomeforeachcomponentofequity,
eitherinthestatementofchangesinequityorinthenotes
tothefinancialstatements.
Providesguidancetoillustratehowtoapplydisclosure
principlesinAASB134forsignificanteventsand
transactions
Clarifythatwhenthefairvalueofawardcreditsis
measuredbasedonthevalueoftheawardsforwhichthey
couldberedeemed,theamountofdiscountsorincentives
otherwisegrantedtocustomersnotparticipatinginthe
awardcreditscheme,istobetakenintoaccount.
Interpretation19
Interpretation19
ExtinguishingFinancial
LiabilitieswithEquity
Instruments
Thisinterpretationclarifiesthatequityinstrumentsissued
toacreditortoextinguishafinancialliabilityare
"considerationpaid"inaccordancewithparagraph41of
IAS39.Asaresult,thefinancialliabilityisderecognisedand
theequityinstrumentsissuedaretreatedasconsideration
paidtoextinguishthatfinancialliability.
Theinterpretationstatesthatequityinstrumentsissuedin
adebtforequityswapshouldbemeasuredatthefairvalue
oftheequityinstrumentsissued,ifthiscanbedetermined
reliably.Ifthefairvalueoftheequityinstrumentsissuedis
notreliablydeterminable,theequityinstrumentsshouldbe
measuredbyreferencetothefairvalueofthefinancial
liabilityextinguishedasofthedateofextinguishment.
45
ACN120394194
c) Basisofconsolidation
The consolidated financial statements comprise the financial statements of Integrated Legal
HoldingsLimitedanditssubsidiaries(asoutlinedinnote26(a))asat30Juneeachyear(theGroup).
SubsidiariesareallthoseentitiesoverwhichtheGrouphasthepowertogovernthefinancialand
operatingpoliciessoastoobtainbenefitsfromtheiractivities.Theexistenceandeffectofpotential
votingrightsthatarecurrentlyexercisableorconvertibleareconsideredwhenassessingwhethera
groupcontrolsanotherentity.
The financial statements of the subsidiaries are prepared for the same reporting period as the
parentcompany,usingconsistentaccountingpolicies.
In preparing the consolidated financial statements, all intercompany balances and transactions,
income and expenses and profit and losses resulting from intragroup transactions have been
eliminatedinfull.
Subsidiaries are fully consolidated from the date on which control is obtained by the Group and
ceasetobeconsolidatedfromthedateonwhichcontrolistransferredoutoftheGroup.
The acquisition of subsidiaries prior to 1 July 2009 is accounted for using the purchase method of
accounting. The purchase method of accounting involves allocating the cost of the business
combination to the fair value of the assets acquired and the liabilities and contingent liabilities
assumedatthedateofacquisition.
d) Businesscombinations
Theacquisitionmethodofaccountingisusedtoaccountforallbusinesscombinationsregardlessof
whetherequityinstrumentsorotherassetsareacquired.Costismeasuredasthefairvalueofthe
assetsgiven,sharesissuedorliabilitiesincurredorassumedatthedateofexchange.Costsdirectly
attributable to the combination are recognised as expenses in the statement of comprehensive
income.
Whereequityinstrumentsareissuedinabusinesscombination,thefairvalueoftheinstrumentsis
their published market price as at the date of exchange unless, in rare circumstances, it can be
demonstratedthatthepublishedpriceatthedateofexchangeisanunreliableindicatoroffairvalue
and that other evidence and valuation methods provide a more reliable measure of fair value.
Transactioncostsarisingontheissueofequityinstrumentsarerecogniseddirectlyinequity.
Exceptfornoncurrentassetsordisposalgroupsclassifiedasheldforsale(whicharemeasuredat
fair value less costs to sell), all identifiable assets acquired and liabilities and contingent liabilities
assumedinabusinesscombinationaremeasuredinitiallyattheirfairvaluesattheacquisitiondate,
irrespective of the extent of any noncontrolling interest. The excess of the cost of the business
combination over the net fair value of the Groups share of the identifiable net assets acquired is
recognisedasgoodwill.IfthecostofacquisitionislessthantheGroupsshareofthenetfairvalueof
theidentifiablenetassetsofthesubsidiary,thedifferenceisrecognisedasagaininthestatementof
comprehensiveincome,butonlyafterareassessmentoftheidentificationandmeasurementofthe
netassetsacquired.
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ACN120394194
Where settlement of any part of the consideration is deferred, the amounts payable in the future
are discounted to their present value as at the date of exchange. The discount rate used is the
entitysincrementalborrowingrate,beingtherateatwhichasimilarborrowingcouldbeobtained
fromanindependentfinancierundercomparabletermsandconditions.
e) Operatingsegments
Anoperatingsegmentisacomponentofanentitythatengagesinbusinessactivitiesfromwhichit
may earn revenues and incur expenses (including revenues and expenses relating to transactions
withothercomponentsofthesameentity),whoseoperatingresultsareregularlyreviewedbythe
entitys chief operating decision maker to make decisions about resources to be allocated to the
segmentandassessitsperformanceandforwhichdiscretefinancialinformationisavailable.This
includesstartupoperationswhichareyettoearnrevenues.Managementwillalsoconsiderother
factorsindeterminingoperatingsegmentssuchastheexistenceofalinemanagerandthelevelof
segmentinformationpresentedtotheBoardofDirectors.
Operatingsegmentshavebeenidentifiedbasedontheinformationprovidedtothechiefoperating
decisionmakersbeingtheexecutivemanagementteam.
The Group aggregates two or more operating segments when they have similar economic
characteristics,andthesegmentsaresimilarineachofthefollowingrespects:
Natureoftheproductsandservices;
Natureoftheproductionprocesses;
Typeorclassofcustomerfortheproductsandservices;
Methodsusedtodistributetheproductsorprovidetheservices;and,ifapplicable
Natureoftheregulatoryenvironment.
Operating segments that meet the quantitative criteria as prescribed by AASB 8 are reported
separately. However, an operating segment that does not meet the quantitative criteria is still
reportedseparatelywhereinformationaboutthesegmentwouldbeusefultousersofthefinancial
statements.
Informationaboutotherbusinessactivitiesandoperatingsegmentsthatarebelowthequantitative
criteriaarecombinedanddisclosedinaseparatecategoryforallothersegments.
f) Cashandcashequivalents
Cashandcashequivalentsinthestatementoffinancialpositioncomprisecashatbankandinhand
andshorttermdepositswithanoriginalmaturityofthreemonthsorlessthatarereadilyconvertible
toknownamountsofcashandwhicharesubjecttoaninsignificantriskofchangesinvalue.
Forthepurposesofthestatementofcashflows,cashandcashequivalentsconsistofcashandcash
equivalents as defined above, net of outstanding bank overdrafts. Bank overdrafts are included
within current interestbearing loans and borrowings in current liabilities on the statement of
financialposition.
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ACN120394194
g) Tradeandotherreceivables
Trade receivables are initially recognised at the original fee amount. An estimate is made for
doubtfuldebtswhencollectionofthefullamountisnolongerprobable.Baddebtsareincludedin
the statement of comprehensive income when identified. The Groups standard terms for
settlementfortradereceivablesare30to60days.
Collectabilityoftradereceivablesisreviewedonanongoingbasis.Individualdebtsthatareknown
to be uncollectible are written off when identified. An impairment allowance is recognised when
thereisobjectiveevidencethattheGroupwillnotbeabletocollectthedebt.
Financial difficulties of the debtor, default payments or debts more than 90 days overdue are
consideredobjectiveevidenceofimpairment.Theamountoftheimpairmentlossisthereceivable
carryingamountcomparedtothevalueofestimatedfuturecashflows.
Theabovepolicyappliestointercompanyreceivables.Intercompanyreceivablesarerepayableon
demand.
h) Workinprogress
Work in progress represents costs incurred and includes profit recognised to date on the value of
workcompletedonmattersthatareinprogressatreportingdate.Costsincludebothvariableand
fixedcostsdirectlyrelatedtomatters.
Workinprogressisvaluedatnetrealisablevalueafterprovidingforanyforeseeablelosses.
i) Investmentsandotherfinancialassets
Investments and financial assets in the scope of AASB 139 Financial Instruments: Recognition and
Measurementarecategorisedaseitherfinancialassetsatfairvaluethroughprofitorloss,loansand
receivables, heldtomaturity investments, or availableforsale financial assets. The Group
determines the classification of its financial assets upon initial recognition and, when allowed and
appropriate,reevaluatesthisdesignationateachfinancialyearend.
When financial assets are recognised initially, they are measured at fair value, plus, in the case of
assetsnotatfairvaluethroughprofitorloss,directlyattributabletransactioncosts.
RecognitionandDerecognition
Allregularwaypurchasesandsalesoffinancialassetsarerecognisedonthetradedateiethedate
thattheGroupcommitstopurchasetheasset.Regularwaypurchasesorsalesarepurchasesorsales
offinancialassetsundercontractsthatrequiredeliveryoftheassetswithintheperiodestablished
generallybyregulationorconventioninthemarketplace.
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Availableforsalesecurities
Availableforsaleinvestmentsarethosenonderivativefinancialassets,principallyequitysecurities
thataredesignatedasavailableforsaleorarenotclassifiedasfinancialassetsatfairvaluethrough
profit or loss, loans and receivables, or held to maturity investments. After initial recognition
availableforsalesecuritiesaremeasuredatfairvaluewithgainsorlossesbeingrecognisedasother
comprehensive income/loss until the investment is derecognised or until the investment is
determinedtobeimpaired,atwhichtimethecumulativegainorlosspreviouslyreportedasother
comprehensiveincomeisrecognisedinprofitorloss.
Thefairvaluesofinvestmentsthatareactivelytradedinorganisedfinancialmarketsaredetermined
byreferencetoquotedmarketbidpricesatthecloseofbusinessonthereportingdate.
LoansandReceivables
Loansandreceivablesarenonderivativefinancialassetswithfixedordeterminablepaymentsthat
are not quoted in an active market. Such assets are carried at amortised cost using the effective
interestmethod.Gainsandlossesarerecognisedinthestatementofcomprehensiveincomewhen
theloansandreceivablesarederecognisedorimpaired,aswellasthroughtheamortisationprocess.
j) Plantandequipment
Plantandequipmentisstatedathistoricalcostlessaccumulateddepreciationandanyaccumulated
impairmentlosses.Suchcostincludestheacquisitioncostorcostofreplacingpartsthatareeligible
forcapitalisationwhenthecostofreplacingthepartisincurred.Allotherrepairsandmaintenance
arerecognisedinprofitorlossasincurred.
Depreciationratesusedforeachclassofassetsareasfollows:
Classoffixedasset
Plantandequipment
Leasedequipment
Useful
life
310years
Depreciation
rates
10.0033.33%
Termoflease
Depreciation
method
Straightline
Straightline
The assets residual values, useful lives and amortisation methods are reviewed, and adjusted if
appropriate,ateachreportingdate.
Derecognition
Anitemofplantandequipmentisderecognisedupondisposalorwhennofurtherfutureeconomic
benefitsareexpectedfromitsuseordisposal.
Anygainorlossarisingonderecognitionoftheasset(calculatedasthedifferencebetweenthenet
disposalproceedsandthecarryingamountoftheasset)isincludedinprofitorlossintheyearthe
assetisderecognised.
k) Leases
The determination of whether an arrangement is or contains a lease is based on the substance of
the arrangement and requires an assessment of whether the fulfilment of the arrangement is
dependentontheuseofaspecificassetorassetsandthearrangementconveysarighttousethe
asset.
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Groupasalessee
Finance leases, which transfer to the Group substantially all the risks and benefits incidental to
ownership of the leased item, are capitalised at the inception of the lease at the fair value of the
leasedassetor,iflower,atthepresentvalueoftheminimumleasepayments.Leasepaymentsare
apportioned between the finance charges and reduction of the lease liability so as to achieve a
constantrateofinterestontheremainingbalanceoftheliability.Financechargesarerecognisedas
anexpenseinprofitorloss.
Capitalisedleasedassetsaredepreciatedovertheshorteroftheestimatedusefullifeoftheasset
andtheleasetermifthereisnoreasonablecertaintythattheGroupwillobtainownershipbythe
endoftheleaseterm.
Operatingleasepaymentsarerecognisedasanexpenseinthestatementofcomprehensiveincome
onastraightlinebasisovertheleaseterm.Operatingleaseincentivesarerecognisedasaliability
whenreceivedandsubsequentlyreducedbyallocatingleasepaymentsbetweenrentalexpenseand
reductionoftheliability.
l) Impairmentofnonfinancialassetsotherthangoodwill
Otherassetsaretestedforimpairmentwhenevereventsorchangesincircumstancesindicatethat
thecarryingamountmaynotberecoverable.
The Group conducts an annual internal review of asset values, which is used as a source of
information to assess for any indicators of impairment. External factors, such as changes in
expectedfutureprocessesandeconomicconditions,arealsomonitoredtoassessforindicatorsof
impairment.Ifanyindicationofimpairmentexists,anestimateoftheassetsrecoverableamountis
calculated.
Animpairmentlossisrecognisedfortheamountbywhichtheassetscarryingamountexceedsits
recoverableamount.Recoverableamountisthehigherofanassetsfairvaluelesscoststoselland
valueinuse.Forthepurposesofassessingimpairment,assetsaregroupedatthelowestlevelsfor
whichthereareseparatelyidentifiablecashinflowsthatarelargelyindependentofthecashinflows
from the other assets orgroups of assets (cash generating units). Nonfinancial assets other than
goodwill that suffered impairment are tested for possible reversal of the impairment whenever
eventsorchangesincircumstancesindicatethattheimpairmentmayhavereversed.
m) Goodwillandintangibles
Goodwill
Goodwillacquiredinabusinesscombinationisinitiallymeasuredatcostbeingtheexcessofthecost
of the business combination over the Groups interest in the net fair value of the acquiree's
identifiableassets,liabilitiesandcontingentliabilities.
Followinginitialrecognition,goodwillismeasuredatcostlessanyaccumulatedimpairmentlosses.
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ACN120394194
For the purpose of impairment testing, goodwill acquired in a business combination is, from the
acquisitiondate,allocatedtoeachoftheGroupscashgeneratingunits,orgroupsofcashgenerating
units,thatareexpectedtobenefitfromthesynergiesofthecombination,irrespectiveofwhether
other assets or liabilities of the Group are assigned to those units or groups of units. Each unit or
groupofunitstowhichthegoodwillissoallocated:
representsthelowestlevelwithintheGroupatwhichthegoodwillismonitoredforinternal
managementpurposes;and
is not larger than an operating segment determined in accordance with AASB 8 Operating
Segments.
Impairmentisdeterminedbyassessingtherecoverableamountofthecashgeneratingunit(groupof
cash generating units), to which the goodwill relates. When the recoverable amount of the cash
generatingunit(groupofcashgeneratingunits)islessthanthecarryingamount,animpairmentloss
isrecognised.Whengoodwillformspartofacashgeneratingunit(groupofcashgeneratingunits)
andanoperationwithinthatunitisdisposedof,thegoodwillassociatedwiththeoperationdisposed
ofisincludedinthecarryingamountoftheoperationwhendeterminingthegainorlossondisposal
oftheoperation.Goodwilldisposedofinthismannerismeasuredbasedontherelativevaluesof
theoperationdisposedofandtheportionofthecashgeneratingunitretained.
Impairmentlossesrecognisedforgoodwillarenotsubsequentlyreversed.
Intangibles
Intangibleassetsacquiredseparatelyorinabusinesscombinationareinitiallymeasuredatcost.The
cost of an intangible asset acquired in a business combination is its fair value as at the date of
acquisition.Followinginitialrecognition,intangible assetsarecarriedat cost lessanyaccumulated
amortisationandanyaccumulatedimpairmentlosses.
The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets
withfinitelivesareamortisedovertheusefullifeandtestedforimpairmentwheneverthereisan
indicationthattheintangibleassetmaybeimpaired.Theamortisationperiodandtheamortisation
method for an intangible asset with a finite useful life are reviewed at least at each financial year
end.Changesintheexpectedusefullifeortheexpectedpatternofconsumptionoffutureeconomic
benefitsembodiedintheassetareaccountedforprospectivelybychangingtheamortisationperiod
ormethod,asappropriate,whichisachangeinaccountingestimate.Theamortisationexpenseon
intangible assets with finite lives is recognised in profit or loss in the expense category consistent
withthefunctionoftheintangibleasset.
Gains or losses arising from derecognition of an intangible asset are measured as the difference
betweenthenetdisposalproceedsandthecarryingamountoftheassetandarerecognisedinprofit
orlosswhentheassetisderecognised.
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ACN120394194
n) Tradeandotherpayables
Tradepayablesandotherpayablesarecarriedatamortisedcost.However,duetotheirshortterm
nature, they are not discounted. They represent liabilities for goods and services provided to the
Group prior to the end of the financial year that are unpaid and arise when the Group becomes
obliged to make future payments in respect of the purchase of these goods and services. The
amountsareunsecuredandareusuallypaidwithin30daysofrecognition.
o) Interestbearingloansandborrowings
Allloansandborrowingsareinitiallyrecognisedatthefairvalueoftheconsiderationreceivedless
directlyattributabletransactioncosts.
After initial recognition, interestbearing loans and borrowings are subsequently measured at
amortisedcostusingtheeffectiveinterestmethod.Feespaidontheestablishmentofloanfacilities
thatareyieldrelatedareincludedaspartofthecarryingamountoftheloansandborrowings.
BorrowingsareclassifiedascurrentliabilitiesunlesstheGrouphasanunconditionalrighttodefer
settlementoftheliabilityforatleast12monthsafterthereportingdate.
Borrowingcosts
Borrowing costs directly attributable to the acquisition, construction or production of a qualifying
asset(ieanassetthatnecessarilytakesasubstantialperiodoftimetogetreadyforitsintendeduse
orsale)arecapitalisedaspartofthecostofthatasset.Allotherborrowingcostsareexpensedin
theperiodtheyoccur.
p) Provisions
ProvisionsarerecognisedwhentheGrouphasapresentobligation(legalorconstructive)asaresult
of a past event, it is probable that an outflow of resources embodying economic benefits will be
required to settle the obligation and a reliable estimate can be made of the amount of the
obligation.
When the Group expects some or all of a provision to be reimbursed, for example under an
insurance contract, the reimbursement is recognised as a separate asset but only when the
reimbursement is virtually certain. The expense relating to any provision is presented in the
statementofcomprehensiveincomenetofanyreimbursement.
Provisions are measured at the present value of management's best estimate of the expenditure
required to settle the present obligation at the reporting date. If the effect of the time value of
moneyismaterial,provisionsarediscountedusingacurrentpretaxratethatreflectsthetimevalue
of money and the risks specific to the liability. The increase in the provision resulting from the
passageoftimeisrecognisedinfinancecosts.
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ACN120394194
q) Employeebenefits
i) Wages,salaries,annualleaveandsickleave
Liabilities for wages and salaries, including nonmonetary benefits and annual leave due to be
settledwithin12monthsofthereportingdatearerecognisedinrespectofemployees'servicesup
to the reporting date. They are measured at the amounts due to be paid when the liabilities are
settled. Expenses for nonaccumulating sick leave are recognised when the leave is taken and are
measuredattheratespaidorpayable.
ii) Longserviceleave
The liability for long service leave is recognised and measured as the present value of expected
futurepaymentstobemadeinrespectofservicesprovidedbyemployeesuptothereportingdate.
Consideration is given to expected future wage and salary levels, experience of employee
departures,andperiodsofservice.Expectedfuturepaymentsarediscountedusingmarketyieldsat
thereportingdateonnationalgovernmentbondswithtermstomaturityandcurrenciesthatmatch,
ascloselyaspossible,theestimatedfuturecashoutflows.
r) Sharebasedpaymenttransactions
i) Equitysettledtransactions
TheGroupprovidesbenefitstoitsemployees(includingkeymanagementpersonnel)intheformof
sharebased payments, whereby employees render services in exchange for shares or rights over
shares(equitysettledtransactions).
Therearecurrentlytwoplansinplacetoprovidethesebenefits:
TaxExemptEmployeeSharePlan(TEESP),whichprovidesbenefitstoalleligibleemployees;
and
Deferred Employee Share Plan (DESP), which provides benefits to key employees and
directorsoftheGroup.
The cost of these equitysettled transactions with employees is measured by reference to the fair
valueoftheequityinstrumentsatthedateatwhichtheyaregranted.Thefairvalueisdetermined
byreferencetothemarketpriceofthesharesonthedateofgrant.
In valuing equitysettled transactions, no account is taken of any vesting conditions, other than
conditionslinkedtothepriceofthesharesofIntegratedLegalHoldingsLimited(marketconditions)
ifapplicable.
The cost of equitysettled transactions is recognised, together with a corresponding increase in

equity,overtheperiodinwhichtheperformanceand/orserviceconditionsarefulfilled(thevesting
period),endedonthedateonwhichtherelevantemployeesbecomefullyentitledtotheaward(the
vestingdate).
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ACN120394194
At each subsequent reporting date until vesting, the cumulative charge to the statement of
comprehensiveincomeistheproductof:
i.
Thegrantdatefairvalueoftheaward;
ii.
Thecurrentbestestimateofthenumberofawardsthatwillvest,takingintoaccountsuch
factorsasthelikelihoodofemployeeturnoverduringthevestingperiodandthelikelihood
ofnonmarketperformanceconditionsbeingmet;and
iii.
Theexpiredportionofthevestingperiod.
Thechargetothestatementofcomprehensiveincomefortheperiodisthecumulativeamountas
calculated above less the amounts already charged in previous periods. There is a corresponding
entrytoequity.
EquitysettledawardsgrantedbyIntegratedLegalHoldingsLimitedtoemployeesofsubsidiariesare
recognised in the parents separate financial statements as an additional investment in the
subsidiarywithacorrespondingcredittoequity.Asaresult,theexpenserecognisedbyIntegrated
LegalHoldingsLimited inrelationtoequitysettledawardsonlyrepresentstheexpenseassociated
withgrantstoemployeesoftheparent.TheexpenserecognisedbytheGroupisthetotalexpense
associatedwithallsuchawards.
Until an award has vested, any amounts recorded are contingent and will be adjusted if more or
fewer awards vest than were originally anticipated to do so. Any award subject to a market
condition is considered to vest irrespective of whether or not that market condition is fulfilled,
providedthatallotherconditionsaresatisfied.
Ifthetermsofanequitysettledawardaremodified,asaminimumanexpenseisrecognisedasif
the terms had not been modified. An additional expense is recognised for any modification that
increasesthetotalfairvalueofthesharebasedpaymentarrangement,orisotherwisebeneficialto
theemployee,asmeasuredatthedateofmodification.
Ifanequitysettledawardiscancelled,itistreatedasifithadvestedonthedateofcancellation,and
anyexpensenotyetrecognisedfortheawardisrecognisedimmediately.However,ifanewaward
issubstitutedforthecancelledawardanddesignatedasareplacementawardonthedatethatitis
granted, the cancelled and new award are treated as if they were a modification of the original
award,asdescribedinthepreviousparagraph.
s) Contributedequity
Ordinarysharesareclassifiedasequity.Incrementalcostsdirectlyattributabletotheissueofnew
sharesoroptionsareshowninequityasadeduction,netoftax,fromtheproceeds.
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ACN120394194
t) Revenuerecognition
Revenueisrecognisedandmeasuredatthefairvalueoftheconsiderationreceivedorreceivableto
theextentitisprobablethattheeconomicbenefitswillflowtotheGroupandtherevenuecanbe
reliably measured. The following specific recognition criteria must also be met before revenue is
recognised:
i) Renderingofservices
Revenuefromtheprovisionoflegalservicesisrecognisedonanaccrualbasisintheperiodinwhich
thelegalserviceisprovidedandiscalculatedwithreferencetotheprofessionalstaffhoursincurred
oneachmatter.
ii) Onlinelegalandnonlegaldocumentsandpublications
Revenuefromtheprovisionofonlinelegalandnonlegaldocumentsandpublicationsisrecognised
onanaccrualsbasisatthetimeofdeliveryofthedocumentstocustomers.
iii) Subscriptionincome
Revenue from memberships granting the subscriber access to the knowledge base of weekly legal
bulletins,onlinetools,calculatorsandservicesisrecognisedonastraightlinebasiswhichreflects
thetiming,natureandbenefitprovided.Allmembershipshaveasubscriptionperiodofeitherthree
ortwelvemonths.
iv) Interestrevenue
Revenueisrecognisedasinterestaccruesusingtheeffectiveinterestmethod.Thisisamethodof
calculating the amortised cost of a financial asset and allocating the interest revenue over the
relevantperiodusingtheeffectiveinterestrate,whichistheratethatexactlydiscountsestimated
futurecashreceiptsthroughtheexpectedlifeofthefinancialassettothenetcarryingamountofthe
financialasset.
v) Dividends
RevenueisrecognisedwhentheGroupsrighttoreceivethepaymentisestablished.
vi) Rentalrevenue
Rentalrevenuefrominvestment propertiesisaccountedforonastraightlinebasisoverthelease
term.Contingentrentalincomeisrecognisedasincomeintheperiodsinwhichitisearned.Lease
incentivesgrantedarerecognisedasanintegralpartofthetotalrentalincome.
u) Incomeandothertaxes
Current tax assets and liabilities for the current and prior periods are measured at the amount
expected to be recovered from or paid to the taxation authorities based on the current period's
taxableincome.Thetaxratesandtaxlawsusedtocomputetheamountarethosethatareenacted
orsubstantivelyenactedbythereportingdate.
Deferredincometaxisprovidedonalltemporarydifferencesatthereportingdatebetweenthetax
basesofassetsandliabilitiesandtheircarryingamountsforfinancialreportingpurposes.
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ACN120394194
Deferredincometaxliabilitiesarerecognisedforalltaxabletemporarydifferencesexcept:
whenthedeferredincometaxliabilityarisesfromtheinitialrecognitionofgoodwillorofan
assetorliabilityinatransactionthatisnotabusinesscombinationandthat,atthetimeof
thetransaction,affectsneithertheaccountingprofitnortaxableprofitorloss;or
when the taxable temporary difference is associated with investments in subsidiaries,

associates or interests in joint ventures, and the timing of the reversal of the temporary
differencecanbecontrolledanditisprobablethatthetemporarydifferencewillnotreverse
intheforeseeablefuture.
Deferredincometaxassetsarerecognisedforalldeductibletemporarydifferences,carryforwardof
unusedtaxcreditsandunusedtaxlosses,totheextentthatitisprobablethattaxableprofitwillbe
available against which the deductible temporary differences and the carryforward of unused tax
creditsandunusedtaxlossescanbeutilised,except:
whenthedeferredincometaxassetrelatingtothedeductibletemporarydifferencearises
from the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting profit nor
taxableprofitorloss;or
when the deductible temporary difference is associated with investments in subsidiaries,

associatesorinterestsinjointventures,inwhichcaseadeferredtaxassetisonlyrecognised
totheextentthatitisprobablethatthetemporarydifferencewillreverseintheforeseeable
future and taxable profit will be available against which the temporary difference can be
utilised.
Thecarryingamountofdeferredincometaxassetsisreviewedateachreportingdateandreduced
totheextentthatitisnolongerprobablethatsufficienttaxableprofitwillbeavailabletoallowallor
partofthedeferredincometaxassettobeutilised.
Deferredincometaxassetsandliabilitiesaremeasuredatthetaxratesthatareexpectedtoapplyto
theyearwhentheassetisrealisedortheliabilityissettled,basedontaxrates(andtaxlaws)that
havebeenenactedorsubstantivelyenactedatthereportingdate.
Deferredtaxassetsanddeferredtaxliabilitiesareoffsetonlyifalegallyenforceablerightexiststo
set off current tax assets against current tax liabilities and the deferred tax assets and liabilities
relatetothesametaxableentityandthesametaxationauthority.
Incometaxesrelatingtoitemsrecogniseddirectlyinequityarerecognisedinequityandnotinprofit
orloss.
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ACN120394194
Taxconsolidationlegislation
Integrated Legal Holdings Limited and its whollyowned Australian controlled entities have
implementedthetaxconsolidationlegislation.
Theheadentity,IntegratedLegalHoldingsLimitedandthecontrolledentitiesinthetaxconsolidated
groupcontinuetoaccountfortheirowncurrentanddeferredtaxamounts.TheGrouphasapplied
thegroupallocationapproachindeterminingtheappropriateamountofcurrenttaxesanddeferred
taxestoallocatetomembersofthetaxconsolidatedgroup.
In addition to its own current and deferred tax amounts, Integrated Legal Holdings Limited also
recognisesthecurrenttaxliabilities(orassets)andthedeferredtaxassetsarisingfromunusedtax
lossesandunusedtaxcreditsassumedfromcontrolledentitiesinthetaxconsolidatedgroup.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are
recognisedasamountsreceivablefromorpayabletootherentitiesintheGroup.Detailsofthetax
fundingagreementaredisclosedinnote6(b)(i).
Any difference between the amounts assumed and amounts receivable or payable under the tax
funding agreement are recognised as a contribution to (or distribution form) whollyowned tax
consolidatedentities.
Othertaxes
Revenues,expensesandassetsarerecognisednetoftheamountofGSTexcept:
when the GST incurred on a purchase of goods and services is not recoverable from the
taxationauthority,inwhichcasetheGSTisrecognisedaspartofthecostofacquisitionof
theassetoraspartoftheexpenseitemasapplicable;and
receivablesandpayables,whicharestatedwiththeamountofGSTincluded.
ThenetamountofGSTrecoverablefrom,orpayableto,thetaxationauthorityisincludedaspartof
receivablesorpayablesinthestatementoffinancialposition.
CashflowsareincludedinthestatementofcashflowsonagrossbasisandtheGSTcomponentof
cashflowsarisingfrominvestingandfinancingactivities,whichisrecoverablefrom,orpayableto,
thetaxationauthorityisclassifiedaspartofoperatingcashflows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or
payableto,thetaxationauthority.
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ACN120394194
v) Earningspershare
Basicearningspershareiscalculatedasnetprofitattributabletomembersoftheparent,adjusted
to exclude any costs of servicing equity (other than dividends), divided by the weighted average
numberofordinaryshares,adjustedforanybonuselement.
Diluted earnings per share is calculated as net profit attributable to members of the company,
adjusted for costs of servicing equity (other than dividends) divided by the weighted average
numberofordinarysharesanddilutivepotentialordinaryshares,adjustedforanybonuselement.
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ACN120394194
3) FINANCIALRISKMANAGEMENTOBJECTIVESANDPOLICIES
The Groups principal financial instruments comprise receivables, payables, bank loans and
overdrafts,financeleasesandcash.
TheGroupmanagesitsexposuretokeyfinancialrisks,includinginterestrateriskinaccordancewith
theGroupsfinancialriskmanagementpolicy.Theobjectiveofthepolicyistosupportthedelivery
oftheGroupsfinancialtargetswhilstprotectingfuturefinancialsecurity.
The main risks arising from the Groups financial instruments are interest rate risk, credit risk and
liquidityrisk.TheGroupusesdifferentmethodstomeasureandmanagedifferenttypesofrisksto
which it is exposed. These include monitoring levels of exposure to interest rate risk and
assessmentsofmarketforecastsforinterestrates.Ageinganalysesandmonitoringofspecificcredit
allowances are undertaken to manage credit risk, and liquidity risk is monitored through the
developmentoffuturerollingcashflowforecasts.
TheBoardreviewsandagreespoliciesformanagingeachoftheserisksassummarisedbelow.
RiskExposuresandResponses
Interestraterisk
TheGroupsexposuretomarketinterestratesrelatesprimarilytotheGroupscashandshortand
longtermdebtobligations,withafloatinginterestrate.Thelevelofdebtisdisclosedinnote19.
At reporting date, the Group had the following mix of financial assets and liabilities exposed to
Australianvariableinterestraterisk:
Financialassets
Financialliabilities
Bankoverdrafts
Bankloans
Netexposure
CONSOLIDATED
2010
2009
$
$
2,151,449
600,694
(202,500)
(134,819)
(950,000)
(1,723,000)
(1,152,500)
(1,857,819)
998,949
(1,257,125)
TheGroupregularlyanalysesitsinterestrateexposuretoensurethatthebestreturnsareachieved
while balancing the long term and short term cash flow requirements for the Groups business
strategies. Within this analysis, consideration is given to the Groups future cash requirements,
alternativecashdepositinganddebtfundingfacilitiesandthemixoffixedandvariableinterestrates
onbankbalances.TheBoardofDirectorsoverseethemanagementofcashfundsbymanagement
andinvestmentopportunitiesthroughtheacquisitionoflawfirms.
The following sensitivity analysis is based on the interest rate risk exposures in existence at the
reportingdate.
59
ACN120394194
3) FINANCIALRISKMANAGEMENTOBJECTIVESANDPOLICIES(continued)
At30June2010and30June2009,ifinterestrateshadmoved,asillustratedinthetablebelow,with
allothervariablesheldconstant,posttaxprofitandothercomprehensiveincomewouldhavebeen
affectedasfollows:
Judgementsofreasonablypossible
movements:
Consolidated
+0.5%(2009:+0.5%)
0.25%(2009:0.25%)
PostTaxProfit
Higher/(Lower)
2010
2009
$
$
645
12,450
(323)
(6,225)
OtherComprehensiveIncome
Higher/(Lower)
2010
2009
$
$
The movements in profit are due to higher/lower interest costs from variable rate debt and cash
balances.Thesensitivityislowerin2010duetoalowerexposuretointerestraterisk.
Managementconsiders+50basispointsand25basispointsasreasonablypossiblemovementfor
thenexttwelvemonthsbasedonmanagementsexpectationsoffutureinterestratemovements.
Creditrisk
CreditriskarisesfromthefinancialassetsoftheGroup,whichcomprisecashandcashequivalents,
tradeandotherreceivablesandworkinprogress.TheGroupsexposuretocreditriskarisesfrom
potentialdefaultofthecounterparty,withamaximumexposureequaltothecarryingamountof
theseinstruments.Exposureatreportingdateisaddressedineachapplicablenote.
TheGroupdoesnotholdanycreditderivativestooffsetitscreditexposure.
The Group manages its credit risk by trading with recognised, trustworthy third parties. In some
instancessecurityovertradereceivableshasbeenrequestedfromspecificclients(egmoniesheldin
trust,securityoverpropertyorbankguarantee),usuallydependentonthetypeoflegalworkbeing
undertaken, as an added measure to guarantee payment in the event of an unsuccessful legal
outcomeoraprotractedmatter.
It is the Groups policy that all clients who wish to trade on credit terms are subject to credit
verificationproceduresincludinganassessmentoftheirindependentcreditrating,financialposition
andpastexperienceonacasebycasebasis.
Inaddition,receivablebalancesaremonitoredonanongoingbasiswiththeresultthattheGroups
exposuretobaddebtsisnotsignificant.
There are no significant concentrations of credit risk within the Group and financial instruments
includingcashandcashequivalentsarespreadbetweenreputablefinancialinstitutionstominimise
theriskofdefaultofcounterparties.
AnanalysisoftheGroupstradereceivablesisincludedinnote12.
60
ACN120394194
3) FINANCIALRISKMANAGEMENTOBJECTIVESANDPOLICIES(continued)
Liquidityrisk
TheGroupsobjectiveistomaintainadequateliquiditytomeettheoperatingrequirementsofthe
businessandtofacilitatetheGroupsongoingacquisitionplans.
The table below reflects all contractually fixed amounts for settlement, repayments and interest
resultingfromrecognisedfinancialliabilities.Undiscountedcashflowsfortherespectiveupcoming
fiscal years are presented. Cash flows for financial liabilities without fixed amount or timing are
basedontheconditionsexistingat30June2010.
TheremainingcontractualmaturitiesoftheGroupsfinancialliabilitiesare:
CONSOLIDATED
30June2010
Financeleases/HPagreements(gross)
Insurancepremiumfundingfacilities
Bankloans(secured)
Interestexpensebankloans
Total
30June2009
Financeleases/HPagreements(gross)
Insurancepremiumfundingfacilities
Bankloans(secured)
Interestexpensebankloans
Total
At
Call
$
6
months
$
612
months
$
3,317,157
106,331
236,113
950,000
14,433
4,624,035
1,738,222
39,264
289,598
100,000
34,239
2,201,323
15
years
$
105,807
7,901
113,707
39,264
24,179
623,000
21,722
708,165
Total
$
75,107
268,186
343,293
78,212
1,000,000
30,070
1,108,282
3,392,264
480,324
244,014
950,000
14,433
5,081,036
1,738,222
156,740
313,777
1,723,000
86,031
4,017,770
Liquidity risk is managed on the basis of the businesses needs and is overseen by senior
management.TheGroupmakesuseofdailyandmonthlycashflowanalysistoconsidertheGroups
overall liquidity risk and to monitor existing financial liabilities as well as effective controlling of
futurerisks.
61
ACN120394194
4) SIGNIFICANTACCOUNTINGJUDGEMENTS,ESTIMATESANDASSUMPTIONS
The preparation of the financial statements requires management to make judgements, estimates
and assumptions that affect the reported amounts in the financial statements. Management
continually evaluates its judgements and estimates in relation to assets, liabilities, contingent
liabilities, revenue and expenses. Management bases its judgements and estimates on historical
experienceandonother variousfactorsitbelievestobereasonableunder the circumstances,the
result of which forms the basis of the carrying values of assets and liabilities that are not readily
apparent from other sources. Actual results may differ from these estimates under different
assumptionsandconditions.
Management has identified the following critical accounting policies for which significant
judgements,estimatesandassumptionsaremade.Actualresultsmaydifferfromtheseestimates
under different assumptions and conditions and may materially affect financial results or the
financialpositionreportedinfutureperiods.
Further details of the nature of these assumptions and conditions may be found in the relevant
notestothefinancialstatements.
i) Significantaccountingjudgements
Recoveryofdeferredtaxassets
Deferredtaxassetsarerecognisedfordeductibletemporarydifferencesasmanagementconsiders
thatitisprobablethatfuturetaxableprofitswillbeavailabletoutilisethosetemporarydifferences.
Taxation
The Groups accounting policy for taxation requires managements judgement as to the types of
arrangementsconsideredtobeataxonincomeincontrasttoanoperatingcost.Judgementisalso
requiredinassessingwhetherdeferredtaxassetsandcertaindeferredtaxliabilitiesarerecognised
onthestatementoffinancialposition.Deferredtaxassets,includingthosearisingfromunrecouped
taxlosses,capitallossesandtemporarydifferences,arerecognisedonlywhereitisconsideredmore
likelythannotthattheywillberecovered,whichisdependentonthegenerationofsufficientfuture
taxableprofits.
Assumptionsaboutthegenerationoffuturetaxableprofitsdependonmanagementsestimatesof
future cash flows. These depend on estimates of future operating revenue, operating costs,
restoration costs, capital expenditure, dividends and other capital management transactions.
Judgementsarealsorequiredabouttheapplicationofincometaxlegislation.Thesejudgementsand
assumptions are subject to risk and uncertainty, hence there is a possibility that changes in
circumstances will alter expectations, which may impact the amount of deferred tax assets and
deferredtaxliabilitiesnotrecognisedonthestatementoffinancialpositionandtheamountofother
taxlossesandtemporarydifferencesnotyetrecognised.Insuchcircumstances,someorallofthe
carryingamountsofrecogniseddeferredtaxassetsandliabilitiesmayrequireadjustment,resulting
inacorrespondingcreditorchargetothestatementofcomprehensiveincome.
62
ACN120394194
4) SIGNIFICANTACCOUNTINGJUDGEMENTS,ESTIMATESANDASSUMPTIONS(continued)
ii) Significantaccountingestimatesandassumptions
Impairmentofgoodwill
The Group determines whether goodwill is impaired at least on an annual basis. This requires an
estimation of the recoverable amount of the cash generating units, using a value in use or fair
valuelesscoststoselldiscountedcashflowmethodology,towhichthegoodwillisallocated.No
impairmentloss(2009:$450,000)wasrecognisedinthecurrentyear.Theassumptionsusedinthe
estimation of recoverable amount and the carrying amount of goodwill including a sensitivity
analysisarediscussedinnote15.
Sharebasedpaymenttransactions
TheGroupmeasuresthecostofequitysettledtransactionswithemployeesbyreferencetothefair
valueoftheequityinstrumentsatthedateatwhichtheyaregranted.Thefairvalueisdetermined
basedonthemarketpriceofanIntegratedLegalHoldingsLimitedshareatthegrantdate.
5) SEGMENTINFORMATION
TheGrouphasidentifieditsoperatingsegmentsbasedontheinternalmanagementreportingthatis
used by the executive management team (the chief operating decision maker) in assessing
performanceandallocatingresources.IntegratedLegalHoldingsLimitedsoperatingsegmentshave
been identified based on how the financial and operating results of the Group are monitored and
presentedinternallytotheexecutivemanagementteam.
TheGroupsreportablesegmentsareidentifiedbymanagementbasedonthenatureofthebusiness
andthesimilaritiesofservicesprovided,methodofdeliveryandtypeofclientsastheGroupsrisks
andreturnsareaffectedpredominantlybydifferencesinlegalproductsandservicesperformed.
Theoperatingbusinessesareorganisedandmanagedseparatelyaccordingtothenatureofthelegal
productsandservicesprovided,witheachsegmentrepresentingastrategicbusinessunitthatoffers
differentlegalproductsandservesdifferentmarkets.
Thefollowingreportablesegmentshavebeenidentifiedbymanagement:
LegalServicesDivision
OperatoroflegalpracticesthroughoutAustralia
InformationTechnologyDivision
Provides an internet portal designed to provide easy access to a range of legal and other
documentstothelegalprofessionandpublicalikeandinformationaboutvariousareasoflaw.
63
ACN120394194
5) SEGMENTINFORMATION(continued)
Theaccountingpoliciesusedbythe Groupinreportingsegmentsinternallyarethesame asthose

containedinnote1totheaccounts,exceptforthefollowing:
Intersegmentsales
Intersegmentsalesarerecognisedatcostwithnomarginbuiltintotheintersegmenttransactions,
andaimstoencourageintersegmentworkreferrals.
Unallocatedrevenueandassets
Corporateitemsarenotallocatedtooperatingsegmentsastheyarenotconsideredpartofthecore
operationsofanysegments.
The following tables present revenue and profit information for operating segments for the years
ended30June2010and30June2009.
Yearended30June2010
Revenue
Professionalfees
Interestrevenue
Otherrevenue:
Advertisingrevenue
Sundryrevenue
Totalsegmentrevenue
Unallocatedrevenue:
Interestreceived
Dividendsreceived
Totalunallocatedrevenue
Intersegmentelimination
Totalrevenueperstatementofcomprehensive
income
Result
Segmentprofit
Unallocateditems:
Interestrevenue
Otherunallocateditems
Totalunallocateditems
Profitbeforetaxandfinancecosts
Financecosts
Incometaxexpense
Netprofitafterincometax
Legal
Services
$
Information
Technology
$
22,980,838
11,890
3,699
22,996,427
841,838
7,372
1,975
851,185
2,427,771
290,200
Total
$
23,822,676
11,890
7,372
5,674
23,847,612
27,285
91
27,376
23,874,988
2,717,971
27,285
(860,664)
(407,209)
(84,518)
(1,325,106)
1,392,865
(160,597)
1,232,268
(378,774)
853,494
64
ACN120394194
Yearended30June2009
Revenue
Professionalfees
Interestrevenue
Otherrevenue:
Rentalrevenue
Compensationreceivable
Advertisingrevenue
Sundryrevenue
Intersegmentrevenue
Totalsegmentrevenue
Unallocatedrevenue:
Interestreceived
Dividendsreceived
Totalunallocatedrevenue
Intersegmentelimination
Totalrevenueperstatementofcomprehensive
income
Result
Segmentprofit
Unallocateditems:
Interestrevenue
Impairmentloss
Otherunallocateditems
Totalunallocateditems
Profitbeforetaxandfinancecosts
Financecosts
Incometaxexpense
Netprofitafterincometax
Legal
Services
$
Information
Technology
$
15,604,767
3,801
251,931
139,000
1,497
14,110
16,015,106
783,755
3,182
5,342
1,259
793,538
2,533,798
223,979
Total
$
16,388,522
6,983
251,931
139,000
5,342
2,756
14,110
16,808,644
151,602
85
151,687
(14,110)
16,946,221
2,757,777
151,602
(663,216)
(379,498)
(450,000)
(258,832)
(1,599,944)
1,157,833
(57,148)
1,100,685
(506,810)
593,875
65
ACN120394194
Totalassetshaveincreasedby19%sincethelastannualreport.Segmentassetsfortheyearsended
30June2010and30June2009areasfollows:
Asat30June2010
Segmentassets
Segmentoperatingassets
Unallocatedassets:
Deferredtaxassets
Prepayments
Investmentinassociates
Availableforsalefinancialassets
Plantandequipment
Totalunallocatedassets
Intersegmenteliminations
Totalassetsperstatementoffinancialposition
Legal
Services
$
Information
Technology
$
18,476,679
Total
$
2,157,378
20,634,057
2,134,217
214,582
42,523
712,888
2,642
3,735
3,110,587
(850,756)
22,893,888
Asat30June2009
Segmentassets
Segmentoperatingassets
Unallocatedassets:
Deferredtaxassets
Prepayments
Investmentinassociates
Plantandequipment
Totalunallocatedassets
Totalassetsperstatementoffinancialposition
Legal
Services
$
Information
Technology
$
16,108,199
Total
$
2,166,143
18,274,342
547,437
297,357
170,386
712,888
2,677
5,023
1,735,768
(728,528)
19,281,582
66
ACN120394194
Segmentliabilitiesfortheyearsended30June2010and30June2009areasfollows:
Asat30June2010
Segmentliabilities
Segmentoperatingliabilities
Unallocatedliabilities:
Incometaxpayable
Provisions
Totalunallocatedliabilities
Totalliabilitiesperstatementoffinancialposition
Legal
Services
$
Information
Technology
$
16,806,395
Total
$
137,679
16,944,074
131,386
1,921,081
177,524
10,964
2,240,955
(12,489,055)
6,695,974
Asat30June2009
Segmentliabilities
Segmentoperatingliabilities
Unallocatedliabilities:
Incometaxpayable
Provisions
Totalunallocatedliabilities
Totalliabilitiesperstatementoffinancialposition
Legal
Services
$
Information
Technology
$
14,412,321
Total
$
150,192
14,562,513
222,161
2,646,591
157,011
24,229
3,049,992
(12,193,329)
5,419,176
67
ACN120394194
6) PARENTENTITYINFORMATION
a) InformationrelatingtoIntegratedLegalHoldingsLimited:
2010
$
Currentassets
Totalassets
Currentliabilities
Totalliabilities
Issuedcapital
Accumulatedlosses
Generalreserve
Netlossesonavailableforsaleassets
Totalshareholdersequity
Profitoftheparententity
Totalcomprehensiveincomeoftheparententity
2,187,052
16,575,762
1,281,884
2,251,267
32,160,426
(18,561,603)
727,113
(1,441)
14,324,495
832,598
832,530
2009
$
654,807
14,136,285
1,125,582
2,126,401
30,504,813
(18,493,556)
(1,373)
12,009,884
1,034,986
1,035,098
b) Guaranteesenteredintobytheparententityinrelationtothedebtsofitssubsidiaries:
i) Membersofthetaxconsolidatedgroupandthetaxsharingarrangement
Integrated Legal Holdings Limited and its subsidiaries have formed a tax consolidated Group.
IntegratedLegalHoldingsLimitedistheheadentityofthetaxconsolidatedGroup.Membersofthe
Group have entered into a tax funding agreement that provides for the allocation of income tax
liabilities between the entities should the head entity default on its tax payment obligations. No
amountshavebeenrecognisedinthefinancialstatementsinrespectofthisagreementonthebasis
thatthepossibilityofdefaultisremote.
ii) Taxeffectaccountingbymembersofthetaxconsolidatedgroup
MeasurementmethodadoptedunderUIG1052TaxConsolidationAccounting
The head entity and the controlled entities in the tax consolidated Group continue to account for
theirowncurrentanddeferredtaxamounts.TheGrouphasappliedthegroupallocationapproach
indeterminingtheappropriateamountofcurrenttaxesanddeferredtaxestoallocatetomembers
of the tax consolidated Group. The current and deferred tax amounts of the members of the
consolidatedGrouparerecognisedbytheCompany(asheadentityinthetaxconsolidatedGroup).
Natureofthetaxfundingagreement
MembersofthetaxconsolidatedGrouphaveenteredintoataxfundingagreement.Amountsare
recognisedaspayable to orreceivableby theCompanyandeachmemberofthetaxconsolidated
Groupinrelationtothetaxcontributionamountspaidorpayablebetweentheparententityandthe
other members of the tax consolidated Group in accordance with this agreement. Where the tax
contribution amount recognised by each member of the tax consolidated Group for a particular
period is different to the aggregate of the current tax liability or asset and any deferred tax asset
arisingfromunusedtaxlossesandtaxcreditsinrespectofthatperiod,thedistributionisrecognised
asacontributionfrom(ordistributedto)equityparticipants.
68
ACN120394194
6)PARENTENTITYINFORMATION(continued)
Taxconsolidationcontributions/(distributions)
Integrated Legal Holdings Limited has recognised the following amounts as taxconsolidation
contributionadjustments.
PARENT
2010
$
2009
$
TotalincreasetotaxpayableofIntegratedLegalHoldingsLimited
902,133
893,780
TotalincreasetointercompanyassetsofIntegratedLegalHoldingsLimited
902,133
893,780
7) REVENUEANDEXPENSES
a)
CONSOLIDATED
2010
2009
$
$
251,931
13,046
147,098
13,046
399,029
14,848,185
1,301,645
16,149,830
8,840,917
1,326,549
10,167,466
305,209
2,910
35,640
343,759
151,427
2,429
35,640
189,496
Otherexpenses
Authorroyaltyfees
Donations
Consultingfees
Badanddoubtfuldebts
Bankfees
Otherexpenses
81,773
242,591
274,365
137,687
5,759
742,175
76,816
9,220
2,139
359,678
65,225
21,858
534,936
Financecosts
Interestotherentities
Interestaccretion
146,458
14,139
160,597
48,839
8,309
57,148
Otherrevenue
Rentreceived
Sundryincome
b)
Salariesandemployeebenefitsexpense
Salariesandwagesexpense
Superannuationexpense
c)
Depreciationofplantandequipment
Amortisationof:
Equipmentunderfinancelease
Identifiedintangibles
d)
e)
69
ACN120394194
8) INCOMETAX
a)
Incometaxexpense
Themajorcomponentsofincometaxexpenseare:
Statementofcomprehensiveincome
Currentincometax
Currentincometaxcharge
Adjustmentinrespectofcurrentincometaxofpreviousyears
Deferredincometax
Relatingtooriginationandreversaloftemporarydifferences
Adjustmentinrespectofdeferredincometaxofpreviousyears
Incometaxexpensereportedinthestatementofcomprehensiveincome
CONSOLIDATED
2010
2009
$
$
364,220
503,409
(383,022)
(6,112)
(9,237)
3,401
406,813
6,112
378,774
506,810
b)
c)
Amountschargedorcrediteddirectlytoequity
Deferredincometaxrelatedtoitemscharged/(credited)directlytoequity
Capitalraisingcosts
Numericalreconciliationbetweenaggregatetaxexpenserecognisedin
thestatementofcomprehensiveincomeandtaxexpensecalculatedper
thestatutoryincometaxrate
Areconciliationbetweentaxexpenseandtheproductofaccountingprofit
beforeincometaxmultipliedbytheGroupsapplicableincometaxrateisas
follows:
Accountingprofitbeforetax
Totalaccountingprofitbeforeincometax
AttheParentEntitysstatutoryincometaxrateof30%(2009:30%)
Adjustmentsinrespectofincometaxofpreviousyears
Entertainment
Impairmentloss
Interestaccretion
Investmentallowance
Borrowingcosts
Other
Aggregateincometaxexpense
(34,518)
(34,518)
1,232,268
1,232,268
1,100,685
1,100,685
369,680
23,791
21,251
4,242
5,773
(43,656)
(2,307)
378,774
330,206
38,770
135,000
4,451
(1,368)
(249)
506,810
70
ACN120394194
8)INCOMETAX(continued)
CONSOLIDATED
Recogniseddeferredtaxassetsandliabilities
Openingbalance
Acquisitions
(Charged)/creditedtoincome
Chargedtoequity
Otherpayments/(receipts)
ClosingBalance
d)
2010
2010
2009
2009
$
Current
Income
Tax
$
Current
Income
Tax
Deferred
IncomeTax
Deferred
IncomeTax
(157,011)
464,147
(968,272)
410,647
18,802
(397,576)
34,518
63,013
(497,297)
(9,513)
1,308,558
(177,524)
101,089
(157,011)
464,147
378,774
506,810
628,799
611,125
(527,710)
(146,978)
101,089
464,147
(39,315)
Taxexpense/(benefit)instatementof
comprehensiveincome
Amountsrecognisedinthestatementof
financialposition:
Deferredtaxasset
Deferredtaxliability
Deferredincometaxasat30June2010relatestothefollowing:
CONSOLIDATED
i) Deferredtaxassets
Employeeprovisions:
Annualleave
Longserviceleave
Doubtfuldebts
Prepayments
Amortisationintangibleassets
Leaseliabilities
Accruedauditfees
Unpaidsuperannuation
Leaseincentive
Capitalraisingcosts
Grossdeferredtaxassets
Setoffofdeferredtaxliabilities
Netdeferredtaxassets
ii)
Deferredtaxliabilities
Workinprogress
Plantandequipment
Deferredconsiderationprovisions
Identifiedintangibleatacquisition
Leasedassets
Prepayments
Grossdeferredtaxliabilities
Setoffofdeferredtaxassets
Netdeferredtaxliabilities
STATEMENTOF
FINANCIALPOSITION
2010
2009
$
$
162,451
106,632
102,871
84,494
39,902
31,452
3,783
18,682
1,218
2,394
70,737
32,755
5,857
4,728
63,029
87,776
178,951
242,212
628,799
611,125
(527,710)
101,089
406,006
1,088
19,604
1,670
99,342
527,710
(146,978)
464,147
1,088
4,249
48,976
2,543
90,122
146,978
(527,710)
(146,978)
At30June2010,therearenounrecognisedtemporarydifferences.
71
ACN120394194
9) DIVIDENDSDECLARED
a) Unrecognisedamounts
Dividendsonordinaryshares:
Finalfrankeddividendfor2010:0.5centspershare
(2009:nil)
CONSOLIDATED
2010
$
2009
$
432,423
b) Frankingcreditbalance
Theamountoffrankingcreditsavailableforthesubsequentfinancialyear
are:
Frankingaccountbalanceasattheendofthefinancialyearat30%(2009:
30%)
Netfrankingcreditsthatarosefromthepaymentofincometaxpayable
andrefundsreceivedduringthefinancialyear
Franking credits that will arise from the payment of dividends as at the
endofthefinancialyear
Franking credits that will arise from the receipt of dividends recognised
receivablesatthereportingdate
Theamountoffrankingcreditsavailableforfuturereportingperiods
Impactonthefrankingaccountofdividendsproposedordeclaredbefore
the financial report was authorised for issued but not recognised as a
distributiontoequityholdersduringtheperiod
PARENT
2010
$
2009
$
590,224
703,870
177,524
157,011
767,748
860,881
(185,324)
582,424
860,881
c) Taxrates
Thetaxrateatwhichpaiddividendshavebeenfrankedis30%(2009:30%).
Dividendsproposedwillbefrankedattherateof30%(2009:30%).
72
ACN120394194
10) EARNINGSPERSHARE
Thefollowingreflectstheincomeusedinthebasicanddilutedearningspersharecomputations:
a) Earningsusedincalculatingearningspershare
Forbasicanddilutedearningspershare:
Netprofitattributabletoordinaryequityholdersoftheparent
b) Weightedaveragenumberofshares
Weightedaveragenumberofordinarysharesforbasicanddilutedearningspershare
CONSOLIDATED
2010
2009
$
$
853,494
593,875
2010
2009
No.
No.
72,253,529
66,860,219
No instruments (eg share options) existed at reporting date which could potentially dilute basic
earningspershareineitheroftheperiodspresented.
Therehavebeennotransactionsinvolvingordinarysharesorpotentialordinarysharesthatwould
significantly change the number of ordinary shares or potential ordinary shares outstanding
betweenthereportingdateandthedateofcompletionofthesefinancialstatements.
11) CASHANDCASHEQUIVALENTS
Cashatbankandinhand
CONSOLIDATED
2010
2009
$
$
2,151,449
600,694
Cashatbankearnsinterestatfloatingratesbasedondailybankdepositrates.Thecarryingamounts
ofcashandcashequivalentsapproximatesfairvalue.
Reconciliationtostatementofcashflows
Forthepurposesofthestatementofcashflows,cashandcashequivalents
comprisethefollowingat30June:
Cashatbankandinhand
Shorttermdeposits
Bankoverdrafts(note20)
CONSOLIDATED
2010
2009
$
$
2,151,449
(202,500)
1,948,949
600,694
(134,819)
465,875
73
ACN120394194
12) TRADEANDOTHERRECEIVABLES
Tradereceivables
Allowanceforimpairmentloss(a)
Unbilledclientdisbursements
Prepayments
Otherreceivables
Carryingamountoftradeandotherreceivables
CONSOLIDATED
2010
2009
$
$
6,854,442
4,862,586
(133,006)
(104,839)
6,721,436
4,757,747
190,847
139,019
589,361
651,276
37,226
68,191
7,538,870
5,616,233
a) Allowanceforimpairmentloss
Tradereceivablesarenoninterestbearingandaregenerallyon3060dayterms.Anallowancefor
impairmentlossisrecognisedwhenthereisobjectiveevidencethatanindividualtradereceivableis
impaired. An impairment lossof $274,365 (2009:$359,678) has been recognised by the Group in
thecurrentyearwhichincludesbaddebtsexpenserecognisedof$246,197(2009:$267,796).These
amountshavebeenincludedinotherexpenses.
Movementsintheallowanceforimpairmentlosswereasfollows:
Openingbalanceatthebeginningoftheyear
Chargefortheyear
Closingbalanceattheendoftheyear
CONSOLIDATED
2010
2009
$
$
104,839
12,957
28,167
91,882
133,006
104,839
Asat30June2010,theaginganalysisoftradereceivablesisasfollows:
2010
Consolidated
2009
Consolidated
*PDNIpastduenotimpaired
Total
6,854,442
4,862,586
030
days
3160
days
6190
Days
PDNI*
3,424,020
932,785
399,106
2,245,394
739,220
389,147
6190
Days
CI*
+91
Days
PDNI*
+91
Days
CI*
1,965,525
133,006
1,383,986
104,839
CIconsideredimpaired
Receivables past due but not considered impaired are $2,364,631 (2009: $1,786,090). Each
operatingunithasbeenindirectcontactwiththerelevantdebtorandissatisfiedthatpaymentwill
bereceivedinfull.
Otherbalanceswithintradeandotherreceivablesdonotcontainimpairedassetsandarenotpast
due.Itisexpectedthattheseotherbalanceswillbereceivedwhendue.
Unbilled client disbursements are incurred only where sufficient assets are in trust or subject to
recovery.Assuch,noimpairmentissuesarenoted.
b) Fairvalueandcreditrisk
Duetotheshorttermnatureofthesereceivables,theircarryingvalueisassumedtoapproximate
theirfairvalue.
Themaximumexposuretocreditriskisthecarryingvalueofreceivables.
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ACN120394194
13) WORKINPROGRESS
Workinprogress
CONSOLIDATED
2010
2009
$
$
1,353,354
1,370,212
Allowanceforrecoverableamount
Workinprogressisvaluedatitsnetrealisablevalueafterprovidingforanyforeseeablelossesthat
havebeencalculatedusinghistoricaldata.
14) PLANTANDEQUIPMENT
Reconciliationofcarryingamountsatthebeginningandendoftheperiod
Plantand
equipment
$
CONSOLIDATED
Leased
equipment
$
Yearended30June2010
Balanceasat1July2009netofaccumulateddepreciation
Additions
Disposals
Depreciationchargefortheyear
Balanceasat30June2010netofaccumulateddepreciation
Total
$
682,882
807,265
(9,192)
(305,209)
1,175,746
8,478
(2,910)
5,568
691,360
807,265
(9,192)
(308,119)
1,181,314
Asat30June2010
Cost
Accumulateddepreciation
Netcarryingamount
1,709,621
(533,875)
1,175,746
10,907
(5,339)
5,568
1,720,528
(539,214)
1,181,314
Plantand
equipment
$
CONSOLIDATED
Leased
equipment
$
Yearended30June2009
Balanceasat1July2008netofaccumulateddepreciation
Additions
Acquisitionofsubsidiary
Disposals
Depreciationchargefortheyear
Balanceasat30June2009netofaccumulateddepreciation
Total
$
182,891
180,612
474,665
(3,859)
(151,427)
682,882
9,945
962
(2,429)
8,478
192,836
181,574
474,665
(3,859)
(153,856)
691,360
Asat30June2009
Cost
Accumulateddepreciation
Netcarryingamount
911,224
(228,342)
682,882
10,907
(2,429)
8,478
922,131
(230,771)
691,360
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ACN120394194
15) GOODWILL
a) Reconciliationofcarryingamountsatthebeginningandendoftheperiod
Yearended30June2010
Balanceasat1July2009netofaccumulatedimpairment
Acquisitionofsubsidiary
Deferredconsiderationachieved(note29)
Impairment
Balanceasat30June2010netofaccumulatedimpairment
CONSOLIDATED
2010
2009
$
$
10,372,263
6,330,233
4,492,030
98,337
(450,000)
10,470,600
10,372,263
Asat30June2010
Cost(grosscarryingamount)
Accumulatedimpairment
Netcarryingamount
11,136,426
(665,826)
10,470,600
11,038,089
(665,826)
10,372,263
(b)DescriptionoftheGroupsgoodwill
After initial recognition, goodwill acquired in a business combination is measured at cost less any
accumulatedimpairmentlosses.Goodwillisnotamortisedbutissubjecttoimpairmenttestingon
anannualbasisorwheneverthereisanindicationofimpairment(refertosection(c)ofthisnote).
(c)Impairmenttestsforgoodwillwithindefiniteusefullives
(i)Descriptionofthecashgeneratingunitsandotherrelevantinformation
Goodwill acquired through business combinations has been allocated to four individual cash
generatingunitsforimpairmenttestingasfollows:
TalbotOliviercashgeneratingunit(legalservicesreportablesegmentrefernote5);
BrettDaviesLawyerscashgeneratingunit(legalservicesreportablesegmentrefernote5);
LawCentralcashgeneratingunit (informationtechnologyreportablesegmentrefernote
5);and
ArgyleLawyerscashgeneratingunit(legalservicesreportablesegmentrefernote5).
Therecoverableamountsofthecashgeneratingunits,excludingLawCentral,havebeendetermined
based on a value in use calculation using cash flow projections as at 30 June that is based on a
discountedcashflowmethodology.
TherecoverableamountoftheLawCentralcashgeneratingunithasbeendeterminedbasedonthe
fairvaluelesscoststosellcalculationusingcashflowprojectionsasat30June2010thatisbasedon
financial budgets approved by the Board covering a fiveyear period. This method calculates the
bestestimatethatanindependentthirdpartywouldpaytopurchasethecashgeneratingunitless
applicablesellingcostsatthereportingdate.Thevaluationisbasedoncashflowprojectionsusing
assumptions that represent managements best estimate of the range of business and economic
conditionsatthistime.
ThevaluationshavebeenreviewedandapprovedbytheBoard.
76
ACN120394194
Thevalueinuseandfairvaluelesscoststosellvaluationsarecomparedtothenetcarryingamount
of goodwill recognised in the accounts. If the calculated recoverable amount exceeds the net
carryingamount,noimpairmentlossisrecorded.
(ii)Keyassumptionsusedinrecoverablevaluecalculations
Thekeyassumptionsmadebymanagementindeterminingtherecoverablevalueinclude:
Yearended30June2010
Goodwillrecognised
Argyle
Lawyers
Brett
Davies
Lawyers
Talbot
Oliver
Law
Central
$4,590,367
$704,000
$3,106,233
$2,070,000
Pretaxnominaldiscountrate
Growthinfees2011
Growthinfees20122015
Yearended30June2009
Goodwillrecognised
17.0%
18.0%
5.0%
$4,492,030
17.0%
16.0%
5.0%
$704,000
17.0%
21.0%
5.0%
$3,106,233
17.0%
16.0%
5.0%
$2,070,000
Pretaxnominaldiscountrate
Growthinfees2010
Growthinfees20112014
17.5%
20.6%
5.0%
17.5%
25.0%
5.0%
17.5%
20.5%
5.0%
17.5%
18.0%
5.4%
Discountrate
The discountrateappliedof17.0%(2009:17.5%)iscalculated usingtheweightedaveragecostof
capitalmethodandreflectsmanagement'sestimateofthetimevalueofmoneyandrisksspecificto
the cash generating units. This is the benchmark used by management to assess operating
performanceandtoevaluatefutureinvestmentproposals.
Growthinfees
The forecast growth in fees is calculated on historical fees adjusted for budgeted fee increases,
anticipatedinflationandfeegrowthtobegeneratedfromtheclientbaseinlinewithmarkettrends.
(iii)Sensitivitytochangesinassumptions
WithregardstotheassessmentofthevalueinuseoftheArgyleLawyers,BrettDaviesLawyersand
Talbot Olivier and the fair value less costs to sell of the Law Central cash generating units,
managementconsiderthatnoreasonablypossiblechangeinanyofthekeyassumptionsin(ii)above
would significantly erode the headroom calculated and cause the carrying value of the cash
generating units to exceed its recoverable amount. This assurance has been obtained by the
analysisperformedintherecoverablevaluecalculationswherebymanagementassessedtheresults
oftheGroupnotmeetingfeerevenuegrowthtargetsandapplyingthehighestreasonablypossible
discountrates.
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ACN120394194
16) INTANGIBLEASSETS
a) Reconciliationofcarryingamountsatthebeginningandendoftheperiod
Openingbalanceasnetofaccumulatedamortisation
Amortisation
Closingbalancenetofaccumulatedamortisation
Cost(grosscarryingamount)
Accumulatedamortisation
Netcarryingamountattheendofthefinancialyear
CONSOLIDATED
2010
2009
$
$
100,980
136,620
(35,640)
(35,640)
65,340
100,980
163,254
(97,914)
65,340
163,254
(62,274)
100,980
b) DescriptionoftheGroupsidentifiedintangibleassets
Intangibleassetsrepresentthevalueofleasedpremisesacquiredupontheacquisitionofthelegal
practice of Peter Marks in the 30 June 2008 financial year and is carried at cost less accumulated
amortisation.Thisintangibleassethasbeenassessedashavingafinitelifeandisamortisedusing
the straight line method over the remaining term of the lease. The amortisation has been
recognised in the statement of comprehensive income in the line item depreciation and
amortisationexpense.
17) OTHERNONCURRENTASSETS
Sharesinlistedsecuritiesatfairvalue
CONSOLIDATED
2010
2009
$
$
2,642
2,677
2,642
2,677
Availableforsale investments consist of investments in ordinary shares. The fair value of listed
availableforsale investments has been determined directly by reference to published price
quotationsinanactivemarket.
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ACN120394194
18) TRADEANDOTHERPAYABLES
Current
Tradepayables
Otherpayablesandaccruals
NonCurrent
Tradepayables
CONSOLIDATED
2010
2009
$
$
719,856
279,882
2,597,301
1,458,340
3,317,157
1,738,222
75,107
75,107
a) Fairvalue
Duetotheshorttermnatureofthesepayables,theircarryingvalueisassumedtoapproximatetheir
fairvalue.
b) Interestrateandliquidityrisk
Informationregardinginterestrateandliquidityriskexposureissetoutinnote3.
19) INTERESTBEARINGLOANSANDBORROWINGS
Current
Bankoverdraft
Obligationsunderfinanceleasesandhirepurchasecontracts(note30(i))
Insurancepremiumfunding(unsecured)
Bankloan(secured)
NonCurrent
Obligationsunderfinanceleasesandhirepurchasecontracts(note30(i))
Loanrelatedparty(unsecured)
Bankloan(secured)
CONSOLIDATED
2010
2009
$
$
202,500
134,819
176,811
72,734
244,014
313,777
950,000
723,000
1,573,325
1,244,330
260,913
260,913
63,555
550
1,000,000
1,064,105
The carrying amount of the Groups current and noncurrent borrowings approximate their fair
value.Detailsregardingliquidityriskaredisclosedinnote3.
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ACN120394194
19)INTERESTBEARINGLOANSANDBORROWINGS(continued)
a) Assetspledgedassecurity
The carrying amounts of assets pledged as security for current and noncurrent interest bearing
liabilitiesare:
Financelease
Leasedofficeequipment(note30(i))
Totalassetspledgedassecurity
CONSOLIDATED
2010
2009
$
$
5,568
8,478
5,568
8,478
Inaddition,the$950,000bankloanissecuredbyafixedandfloatingchargeoverthetotalassetsof
thegroup.
b) Defaultsandbreaches
Duringtheyeartherewerenodefaultsorbreachesonanyoftheloans.
20) PROVISIONS
Current
Longserviceleave
Annualleave
NonCurrent
Longserviceleave
CONSOLIDATED
2010
2009
$
$
145,554
104,027
541,503
355,439
687,057
459,466
197,350
197,350
177,620
177,620
21) OTHERLIABILITIES
Current
Deferredconsiderationpayable(1)
Leaseincentiveobligation(2)
NonCurrent
(1)
Deferredconsiderationpayable
(2)
Leaseincentiveobligation
CONSOLIDATED
2010
2009
$
$
197,444
200,000
82,489
279,933
200,000
127,608
127,608
85,837
292,585
378,422
(1)DeferredconsiderationpayableontheacquisitionofTheArgylePartnership(seenote29)
(2) Operating lease incentives are recognised as a liability when received and subsequently reduced by allocating lease
paymentsbetweenrentalexpenseandreductionoftheliabilitytoensurerentalexpenseisrecognisedonastraight
linebasisovertheleaseterm.
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ACN120394194
22) ISSUEDCAPITAL
Consolidated
Consolidated
Consolidated
2010
2009
2010
Shares
Shares
$
Fullypaidshares
86,139,666
69,081,178
32,126,345
Partlypaidshares(1)
371,667
331,667
34,081
(2)
(26,667)
(66,667)
Forfeitedsharesheldintrust
86,484,666
69,346,178
32,160,426
(1)SharesissuedundertheDeferredEmployeeSharePlanthatvestoverthreeyears(note28).
(2)SharesissuedbutforfeitedundertheDeferredEmployeeSharePlan,heldintrust(note28).
Consolidated
2009
$
30,489,975
14,838
30,504,813
Fullypaidordinarysharescarryonevotepershareandcarrytherighttodividends.Theshareshave
noparvalue.
Movementinordinarysharesonissue:
Shares
Openingbalanceasat1July2008
63,538,320
29,729,975
4,142,857
580,000
IssueofsharesundertheDeferredEmployeeSharePlan
398,334
17,666
SharesforfeitedundertheDeferredEmployeeSharePlan
(66,667)
(2,828)
1,333,334
180,000
69,346,178
30,504,813
Shares
69,346,178
30,504,813
7,000,000
700,000
353,488
42,410
IssuesofsharesunderSharePlacement(Tranche2)on12May2010
4,100,000
410,000
IssuesofsharesunderSharePurchasePlanon26May2010
5,645,000
564,500
(80,540)
40,000
19,243
86,484,666
32,160,426
Issueofsharesat14centspersharetovendorsofTheArgylePartnershipLawyers
on4November2009
Issueofsharesat13.5centspersharetovendorofmdalawyerson13March2010
IssueofsharesunderSharePlacement(Tranche1)on8April2010
IssuesofsharesunderDividendReinvestmentPlanon9April2010
Costsassociatedwiththecapitalraising,netoftax
IssueofsharesundertheDeferredEmployeeSharePlan
a) Capitalmanagement
TheGroupsobjectiveswhenmanagingcapitalaretosafeguardtheGroupsabilitytocontinueasa
going concern, in order to provide returns to shareholders, and to maintain an optimal capital
structure to allow the Group to pursue its future acquisition activities. Capital is comprised of
shareholdersequityasdisclosedinthestatementoffinancialposition.
Inordertomaintainoradjustthecapitalstructure,theGroupmayadjusttheamountofdividends
paidtoshareholdersandincreaseordecreasetheGroupsdebt,subjecttothecapitalrequirements
oftheGroupsoperationsatthetime.
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ACN120394194
22)ISSUEDCAPITAL(continued)
During the year, the Directors paid an interim dividend of $173,532 (2009: nil) of which $131,113
was paid in cash and the balance of $42,419 was issued as ordinary shares under the Companys
dividend reinvestment plan. The Directors have declared a final dividend of 0.50 cents per share
($432,423)forthe2010financialyear(2009:nil).Thedividendreinvestmentplanwillnotbeoffered
forthisdividend.
TheGroupmonitorscapitalonthebasisofthegearingratio.ThelevelofgearingintheCompanyis
withintheacceptablelimitssetbytheDirectorsgiventheimplicationsofthebusinessacquisitions
andpaymentoftaxliabilitiesduringtheyear.
23) ACCUMULATEDLOSSES
Accumulatedlosses
Balanceatbeginningofyear
Netprofitfortheyear
Dividendspaid
Transfertogeneralreserve(note24)
Balanceatendoftheyear
Consolidated
2010
2009
$
$
(16,688,184)
(16,641,034)
853,494
(173,531)
(727,113)
(16,688,184)
(16,641,034)
(15,823,844)
593,875
(1,411,065)
(16,641,034)
24) RESERVES
Netgains/(losses)onavailableforsalefinancialassets
Generalreserve
Balanceatendoftheyear
Consolidated
2010
2009
$
$
(1,441)
(1,373)
727,113
725,672
(1,373)
Netunrealisedgainsreserve
Thisreserverecordsmovementsinthefairvalueofavailableforsalefinancialassets.
Generalreserve
Due to accumulated losses incurred prior to the listing of the company on 17 August 2007, the
Directors resolved to isolate profits derived from trading activities since listing through the
establishmentofaGeneralReserve.
Duringtheperiod,$727,113,representingtradingprofitsto30June2009lessdividendspaid,was
transferredtotheGeneralReservefromAccumulatedLosses.
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ACN120394194
24)RESERVES(continued)
AccumulatedlossesincurredpriortolistingoftheCompanyandcommencementoftradingactivities
arosefromthefollowingtransactions:
(a) impairmentlossesincurredonsharesissuedtovendorsofTalbotOlivierBusinessAssets,Brett
DaviesLawyersBusinessAssetsandLawCentralCoPtyLtdshareholderson29August2006;and
(b) Share based payments expenses for shares issued at a deemed value of 50 cents per share to
directorsandsupporterson29August2006and28February2007.
83
ACN120394194
25) CASHFLOWRECONCILIATION
a) Reconciliationofnetprofitaftertaxtonetcashflowsfromoperations
Netprofit
Adjustmentsfor:
Dividendsreceivedasshares(DRP)
Impairmentlosses
Changesinassetsandliabilities:
(Increase)/decreaseintradeandotherreceivables
(Increase)/decreaseinworkinprogress
(Increase)/decreaseinnetdeferredtaxassets
(Increase)/decreaseinprepayments
(Increase)/decreaseinavailableforsaleassets
Increase/(decrease)intradeandotherpayables
Increase/(decrease)inincometaxpayable
Increase/(decrease)inprovisions
Netcashfrom/(usedin)operatingactivities
b)
CONSOLIDATED
2010
2009
$
$
853,494
593,875
(34)
(41)
343,759
189,496
450,000
19,243
14,838
(1,860,722)
(2,245,095)
16,858
(285,860)
363,058
17,313
95,701
(334,753)
35
(153)
1,348,935
650,950
20,513
(811,261)
247,321
107,946
1,448,161
(1,652,745)
Noncashfinancingandinvestingactivities
Settlementofsubsidiarypurchasewithshares
760,000
26) RELATEDPARTIES
a) Subsidiaries
TheconsolidatedfinancialstatementsincludethefinancialstatementsofIntegratedLegalHoldings
Limitedandthesubsidiarieslistedinthefollowingtable:
Name
ArgyleLawyersPtyLtd
TaxLawyersAustraliaPtyLtd
TalbotOlivierPtyLtd
LawCentralCoPtyLtd
Countryof
Incorporation
Australia
Australia
Australia
Australia
%EQUITYINTEREST
2010
2009
100%
100%
100%
100%
100%
100%
100%
100%
INVESTMENT
2010
2009
2
2
1
1
1
1
712,884
712,884
712,888
712,888
b) Ultimateparent
IntegratedLegalHoldingsLimitedistheultimateAustralianparententityandtheultimateparentof
theGroup.
84
ACN120394194
c) Keymanagementpersonnel
DetailsrelatingtoKMP,includingremunerationpaid,areincludedinnote27.
d) Transactionswithrelatedparties
The following table provides the total amount of transactions that were entered into with related
partiesfortherelevantfinancialyear:
RelatedParty
CONSOLIDATED
Associates:
BrettDaviestradingasBrettDaviesLawyers
Reimbursementowingtopreacquisitionbusiness
DaviesServiceTrust
operatingleaserelatingtopremisesoccupiedby
BrettDaviesLawyersandLawCentral
MarkDouglasstradingasmdalawyers
Deferredconsiderationonacquisitionofbusiness(1)
PeterBobbinandAndrewIreland
Deferredconsiderationpayableonacquisitionof
TheArgylePartnershipLawyers(2)
2010
2009
Other
Transactions
withRelated
Parties
$
Purchases
from
Related
Parties
$
Salesto
Related
Parties
$
550
170,635
116,282
200,000
111,607
2009
(1)Deferredconsiderationaccruedinthe2009financialyearwaspaidinthe2010financialyear.
(2)Deferredconsiderationwasaccruedateachreportingdateandispayableinthe2011financialyear.
85,837
2010
2009
2010
2009
2010
Termsandconditionsoftransactionswithrelatedparties
Sales to and purchases from related parties are made in arms length transactions both at normal
marketpricesandonnormalcommercialterms.
Outstandingbalancesatyearendareunsecured,interestfreeandsettlementoccursincash.
27) KEYMANAGEMENTPERSONNEL
a) CompensationofKeyManagementPersonnel
Shorttermemployeebenefits
Postemploymentbenefits
Otherlongtermbenefits
Sharebasedpayment
2010
$
3,010,738
269,841
116,675
4,685
3,401,939
2009
$
929,277
189,650
51,923
2,753
1,173,603
85
ACN120394194
27)KEYMANAGEMENTPERSONNEL(continued)
b) ShareholdingsofKeyManagementPersonnel
OrdinarysharesheldinIntegratedLegalHoldingsLimited:
Balance
1July2009
New
KMP(7)
Grantedas
Remuneration(6)
Balance
30June
2010
NetChange
Other
Directors
JDawkins
1,626,398
33,884
1,000,000
250,000
2,910,282
300,000
6,251
100,000
2,710,200
57,359
ATregonning
GFowler
Share
Placement&
SharePurchase
Plan
Dividend
Reinvestment
Plan
406,251
2,000,000
43,000
4,810,559
Executives
6,341
3,074,681
1,300,000
391,357
3,544,768
(1)
BTaylor
3,068,340
1,807,727
MDouglass
1,333,334
1,333,334
(4)
AIreland
1,696,428
40,000
1,736,428
157,562
100,000
7,820,478
293,073
690,698
25,929,854
(2)
PBobbin
(3)
(5)
BDavies
7,562,916
JMRudd
Total
45,684
102,500
40,000
573
150,000
17,178,081
3,029,762
40,000
301,313
4,690,000
(1)1,022,780sharesaresubjecttovoluntaryescrowrestrictionuntil16August2011.
(2)565,477sharesaresubjecttovoluntaryescrowrestrictionuntil4November2010and565,476sharesaresubjecttovoluntaryescrow
restrictionuntil4November2011.
(3)888,889sharesaresubjecttovoluntaryescrowrestrictionuntil4November2010
(4)565,476sharesaresubjecttovoluntaryescrowrestrictionuntil4November2010and565,476sharesaresubjecttovoluntaryescrow
restrictionuntil4November2011.
(5)2,518,472sharesaresubjecttovoluntaryescrowrestrictionuntil16August2011.
(6)AcquiredundertheDeferredEmployeeSharePlan(note28).
(7)MDouglassandAIrelandbecomeKMPsfrom1July2009.
Balance
1July2008
Directors
JDawkins
ATregonning
GFowler
PBobbin
(4)
JMRudd
1,626,398
300,000
2,710,200
2,710,200
(1)(2)(3)
Executives
BDavies
Balance
30June2009
300,000
BTaylor
NetChange
Other
1,626,398
Total
Grantedas
Remuneration
3,068,340
3,068,340
7,562,916
7,562,916
1,807,727
1,807,727
27,500
75,000
102,500
15,295,354
75,000
1,807,727
17,178,081
(1)MrBobbinwasappointedasManagingprincipalofArgyleLawyerson1November2008.
(2) 1,696,429 shares were acquired as vendor of The Argyle Partnership Lawyers; the remaining 111,298 shares were acquired on
marketbyMrBobbin.
(3)1,696,429sharesaresubjectto36monthvoluntaryescrowrestrictionfrom4November2008.
(4)AcquiredundertheDeferredEmployeeSharePlan(note28).
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ACN120394194
27)KEYMANAGEMENTPERSONNEL(continued)
c) OthertransactionswithKeyManagementPersonnelandtheirrelatedparties
LeaseofBusinessPremises
BrettDaviesLawyersandLawCentralCoPtyLtdsharebusinesspremisesat201AdelaideTerrace,
Perth.ThesepremisesareleasedfromTheDaviesServiceTrust,anentitythatiscontrolledbyMr
Davies,ManagingPrincipalofBrettDaviesLawyers.Monthlyleaserentalsforeachoftheseentities
havebeencalculatedatcommercialmarketrates.
AmountsrecognisedatthereportingdateinrelationtoothertransactionswithKMP:
Revenueandexpenses
Rentpaid
2010
$
170,635
170,635
2009
$
116,282
116,282
LoanstoKeyManagementPersonnel
Underthetermsofhisemploymentcontract,MrFowler(ManagingDirector)wasprovidedwithan
interestfreeloanof$189,036pertainingtothetaxliabilityofsharesintheCompanyissuedonhis
appointmentinApril2008.Thetermsoftheloanareasfollows:
theloanwillbeforgivenifMrFowlerremainsemployedbytheCompanyforatleast3
yearsfromthedateofcommencementofemployment;
50%oftheloanwillbewaivedifMrFowlerterminateshisemploymentwithin23years;
and
0%oftheloanwillbewaivedifMrFowlerterminateshisemploymentwithin2years.
TheCompanywillmeetanyFBTobligationsarisingfromthistransaction.
ThisloanhasbeenassessedasprepaidemployeebenefitsinaccordancewithAASB119Employee
Benefits.Amortisationexpenseof$107,122(2009:$50,408)hasbeenrecognisedinthestatement
ofcomprehensiveincomeinthelineitemsalariesandemployeebenefitsexpenses.
87
ACN120394194
28) SHAREBASEDPAYMENTPLANS
a) Recognisedsharebasedpaymentexpenses
Theexpenserecognisedforemployeeservicesreceivedduringtheyearisshowninthetablebelow:
Expensearisingfromequitysettledsharebasedpaymenttransactions
CONSOLIDATED
2010
2009
$
$
19,243
14,838
The sharebased payment plans are described below. There have been no cancellations or
modificationstoanyoftheplansduringtheyear.
c) Typesofsharebasedpaymentplans
Taxexemptemployeeshareplan(TEESP)
AllemployeesareeligibletoparticipateintheTEESPiftheymeetthefollowingcriteria:
i.
TheyareapermanentfulltimeorpermanentparttimeemployeeoftheGroup;
ii.
Theyhavemettheprobationperiodunderthetermsoftheiremploymentcontract;
iii.
Theyareatleast18yearsofage;and
iv.
TheyareanAustralianresidentfortaxpurposes.
EmployeeswhoparticipateintheTEESPcannominatetocontributeupto$1,000perannumfrom
their pretax wages or salary by way of an effective salary sacrifice towards acquiring fully paid
ordinarysharesintheCompany.
InaccordancewiththerulesoftheTEESP,sharesacquiredundertheplanmustnotbewithdrawnor
otherwise dealt with, commencing from the date the employee acquires a beneficial interest in
thosesharesuntiltheearliestofthedatethat:
i.
Isthreeyearsaftertheacquisitiondate;or
ii.
TheemployeeceasestobeanemployeeoftheGroup.
The rules of the TEESP do not contain any provisions that could result in an employee forfeiting
ownershipofsharesundertheplan.
Deferredemployeeshareplan(DESP)
Shares are granted to key employees and directors of the Group. The DESP is designed to align
participantsinterestswiththoseofshareholdersbyincreasingthevalueoftheCompanysshares.
EmployeesareeligibletoparticipateintheDESPiftheymeetthefollowingcriteria:
i.
TheyareapermanentfulltimeorpermanentparttimeemployeeoftheGroup;
ii.
Theyhavemettheprobationperiodunderthetermsoftheiremploymentcontract;
iii.
Theyareatleast18yearsofage;and
iv.
TheyareanAustralianresidentfortaxpurposes.
88
ACN120394194
28)SHAREBASEDPAYMENTPLANS(continued)
UndertheDESP,thefairvalueofthesharesissetatthemarketpriceofthesharesonthedateof
grant.
Whenaparticipantceasesemploymentpriortothevestingoftheirshares,thesharesareforfeited
in full or in part, depended on the terms of award of those shares. In the event of a change of
control, the performance period end date will be brought forward to the date of the change of
controlandawardswillvestsubjecttoperformanceoverthisshortenedperiod.
Thevestingperiodofeachshareisthreeyears.Therearenocashsettlementalternatives.
d) SummaryofsharesgrantedunderTEESPandDESParrangements
The following table illustrates the number of and movements in shares granted during the period
undertheTEESPandtheDESP:
TEESP:
Grantedduringtheyear(1)
Transferredtodepartedemployeesduringtheyear(2)
Closingbalanceasat30June2010
DESP:
Grantedduringtheyear
Forfeitedduringtheyear(3)
Closingbalanceasat30June2010
CONSOLIDATED
2010
2009
No
No
255,842
(3,170)
252,672
255,842
255,842
331,667
40,000
371,667
398,334
(66,667)
331,667
(1)SharesgrantedundertheTEESParepurchasedonmarketatgrantdateandimmediatelytransferredtotheemployee.
(2)Sharesaretransferredoutofanemployeetrustintotheemployeesnameonterminationofemployment.
(3)SharesforfeitedareheldintrustwithnilvaluerecognisedbytheGroup.
e) Weightedaverageremainingcontractuallife
Theweightedaverageremainingcontractuallifeasat30June2010forthesharesissuedunderthe
DESPis1.23years(2009:2.13years).
f) Weightedaveragefairvalue
Asat30June2010,theweightedaveragefairvalueofsharesgrantedundertheDESPwas15.5cents
(2009:15.8cents).
89
ACN120394194
29) BUSINESSCOMBINATIONS
AcquisitionofArgyleLawyers
On4November2008,IntegratedLegalHoldingsLimited,throughitswhollyownedsubsidiary,Argyle
LawyersPtyLtd,acquiredthelegalpracticeofTheArgylePartnership.Thetransactioniseffective
from1November2008.
Sincetheendofthepreviousfinancialyear,thefinancialperformanceoftheacquiredbusinesshas
exceededexpectationsandtheamountpayableasdeferredconsiderationinrelationtothebusiness
combinationhasincreasedby$98,337.Thischangeinestimatehasincreasedthetotalacquisition
cost,resultinginacorrespondingincreaseingoodwill.
Forfulldetailsofthebusinesscombinationaffected,pleaserefertotheannualreportfortheyear
ended30June2009.
30) EXPENDITURECOMMITMENTS
i) Leasingcommitments
OperatingleasecommitmentsGroupaslessee
TheGrouphasenteredintooperatingleasesfortherentalofofficespaceatitsvariouscommercial
premises.Thesenoncancellableleaseshaveremainingtermsofbetween2to8years.Theleases
haverenewaloptions.Renewalsareattheoptionofthespecificentitythatholdsthelease.
Futureminimumrentalspayableundernoncancellableoperatingleasesasat30June2010areas
follows:
Withinoneyear
Afteroneyearbutnotmorethanfiveyears
Aftermorethanfiveyears
Totalminimumleasepayments
CONSOLIDATED
2010
2009
$
$
1,973,067
1,924,734
5,791,879
6,537,841
3,133,815
4,254,879
10,898,761
12,717,454
FinanceleaseandhirepurchasecommitmentsGroupaslessee
TheGrouphasfinanceleasesandhirepurchasecontractsforvariousitemsofplantandequipment
withacarryingamountof$458,625(2009:$97,367).Thesecontractsexpirewithin1to4years.The
leaseshavetermsofrenewalandpurchaseoptions.Renewalsareattheoptionofthespecificentity
thatholdsthelease.
Withinoneyear
Totalminimumleasepayments
Lessamountsrepresentingfinancecharges
Presentvalueofminimumleasepayments
CONSOLIDATED
2010
2009
$
$
215,919
78,528
268,187
78,212
484,106
156,740
(46,382)
(20,451)
437,724
136,289
90
ACN120394194
30)EXPENDITURECOMMITMENTS(continued)
Includedinthefinancialstatementsas:
Currentinterestbearingloansandborrowings(note19)
Noncurrentinterestbearingloansandborrowings(note19)
Totalinterestbearingloansandborrowings
CONSOLIDATED
2010
2009
$
$
176,811
72,734
260,913
63,555
437,724
136,289
ii) Plantandequipmentrentalcommitments
TheGrouphascontractualobligationsfortherentalofplantandequipment.Therentalagreements
expirewithin1and3yearsandhavepurchaseoptionsonexpiry.Rentalcommitmentscontracted
foratreportingdatebutnotrecognisedasliabilitiesareasfollows:
Withinoneyear
Totalminimumrentalpayments
CONSOLIDATED
2010
2009
$
$
63,142
107,345
11,138
74,280
74,280
181,625
CONSOLIDATED
2010
2009
$
$
4,315,079
6,694,457
11,009,536
iii) Remunerationcommitments
Commitmentsforthepaymentofsalariesandotherremunerationunderlong
termemploymentcontractsinexistenceatthereportingdatebutnot
recognisedasliabilities,payable:
Withinoneyear
4,440,335
10,442,163
14,882,498
Amounts disclosed as remuneration commitments include commitments arising from the service
contractsofdirectorsandexecutivesreferredtointheRemunerationReportoftheDirectorsReport
that are not recognised as liabilities and are not included in the compensation of KMP for the
currentperiod.
91
ACN120394194
31) CONTINGENCIES
Crossguarantees
Pursuant to Class Order 98/1418, relief has been granted to Talbot Olivier Pty Ltd, Tax Lawyers
AustraliaPtyLtd,ArgyleLawyersPtyLtdandLawCentralCoPtyLtdfromtheCorporationsAct2001
requirementsforpreparation,auditandlodgementoftheirfinancialreports.
As a condition of the Class Order, Integrated Legal Holdings Limited, Talbot Olivier Pty Ltd, Tax
LawyersAustraliaPtyLtd,ArgyleLawyersPtyLtdandLawCentralCoPtyLtdenteredintoaDeedof
CrossGuarantee.TheeffectofthedeedisthatIntegratedLegalHoldingsLimitedhasguaranteedto
payanydeficiencyintheeventofwindingupofeithercontrolledentityoriftheydonotmeettheir
obligationsunderthetermsofoverdrafts,loans,leasesorotherliabilitiessubjecttotheguarantee.
The controlled entities have also given a similar guarantee in the event that Integrated Legal
Holdings Limited is wound up or if it does not meet its obligations under the terms of overdrafts,
loans,leasesorotherliabilitiessubjecttotheguarantee.
ThestatementofcomprehensiveincomeandstatementoffinancialpositionoftheGrouprepresent
thefinancialperformanceandpositionoftheentitiesthataremembersoftheClosedGroup.
32) AUDITORSREMUNERATION
TheauditorofIntegratedLegalHoldingsLimitedisErnst&Young.
AmountsreceivedordueandreceivablebyErnst&Young(Australia)for:
anauditorreviewofthefinancialreportofthecompany
otherservicesinrelationtothecompany
o Taxcompliance
o Taxationservices
AmountsreceivedordueandreceivablebynonErnst&Young(Australia)firmsfor:
otherservicesinrelationtothecompany
o Specialauditsrequiredbyregulators
o Taxationservices
CONSOLIDATED
2010
2009
$
$
136,397
243,161
31,453
18,813
5,500
7,737
173,350
269,711
22,727
17,838
1,366
22,727
19,204
196,077
288,915
33) EVENTSAFTERREPORTINGDATE
On 12 August 2010, the Directors declared a fully franked final dividend with respect to the year
ended30June2010of0.50centspershare,witharecorddateof15October2010andapayment
dateof5November2010.Thetotalamountofthedividendis$432,423.
92
ACN120394194
DirectorsDeclaration
InaccordancewitharesolutionofthedirectorsofIntegratedLegalHoldingsLimited,Istatethat:
1. Intheopinionofthedirectors:
a. Thefinancialstatements,notesandtheadditionaldisclosuresincludedinthedirectors
report designated as audited, of the consolidated entity are in accordance with the
CorporationsAct2001,including:
i. givingatrueandfairviewoftheconsolidatedentitysfinancialpositionasat30
June2010andofitsperformancefortheyearendedonthatdate;and
ii. complyingwithAccountingStandardsandCorporationsRegulations2001;and
b. the financial statements and notes also comply with International Financial Reporting
Standardsasdisclosedinnote2(a).
c. therearereasonablegroundstobelievethattheconsolidatedentitywillbeabletopay
itsdebtsasandwhentheybecomedueandpayable.
2. This declaration has been made after receiving the declarations required to be made to the
directors in accordance with section 295A of the Corporations Act 2001 for the financial year
ended30June2010.
Intheopinionofthe directors,asatthedateofthisdeclaration,therearereasonablegroundsto
believe that the members of the closed group comprising the Company and its controlled entities
will be able to meet any obligations or liabilities to which they are or may become subject to by
virtueofthedeedofcrossguaranteereferredtoinnote32.
OnbehalfoftheBoard.
GFowler
ManagingDirector
Sydney,27September2010
93
Independent audit report to members of Integrated Legal Holdings

Limited
Report on the Financial Report
We have audited the accompanying financial report of Integrated Legal Holdings Limited, which comprises
the statement of financial position as at 30 June 2010, and the statement of comprehensive income,
statement of changes in equity and statement of cash flows for the year ended on that date, a summary of
significant accounting policies, other explanatory notes and the directors declaration of the consolidated
entity comprising the company and the entities it controlled at the years end or from time to time during
the financial year.
Directors Responsibility for the Financial Report

The directors of the company are responsible for the preparation and fair presentation of the financial
report in accordance with the Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Act 2001. This responsibility includes establishing and maintaining
internal controls relevant to the preparation and fair presentation of the financial report that is free from
material misstatement, whether due to fraud or error; selecting and applying appropriate accounting
policies; and making accounting estimates that are reasonable in the circumstances. In Note 2, the
directors also state that the financial report, comprising the financial statements and notes, complies with
International Financial Reporting Standards as issued by the International Accounting Standards Board.
Auditors Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. These Auditing Standards require that we comply
with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial report. The procedures selected depend on our judgment, including the assessment of the risks of
material misstatement of the financial report, whether due to fraud or error. In making those risk
assessments, we consider internal controls relevant to the entitys preparation and fair presentation of the
financial report in order to design audit procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the entitys internal controls. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by the directors, as well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Independence
In conducting our audit we have met the independence requirements of the Corporations Act 2001. We
have given to the directors of the company a written Auditors Independence Declaration, a copy of which
is included in the directors report. In addition to our audit of the financial report, we were engaged to
undertake the services disclosed in the notes to the financial statements. The provision of these services
has not impaired our independence.
Liability limited by a scheme approved

under Professional Standards Legislation
GHM:NR:ILH:049
Auditors Opinion
In our opinion:
1.
2.
the financial report of Integrated Legal Holdings Limited is in accordance with the Corporations Act
2001, including:
i
giving a true and fair view of the financial position of the consolidated entity at 30 June
2010 and of their performance for the year ended on that date; and
ii
complying with Australian Accounting Standards (including the Australian Accounting

Interpretations) and the Corporations Regulations 2001.
the financial report also complies with International Financial Reporting Standards as issued by the
International Accounting Standards Board.
Report on the Remuneration Report

We have audited the Remuneration Report included in pages 8 to 20 of the directors report for the year
ended 30 June 2010. The directors of the company are responsible for the preparation and presentation
of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
Auditors Opinion
In our opinion the Remuneration Report of Integrated Legal Holdings Limited for the year ended 30 June
2010, complies with section 300A of the Corporations Act 2001.
Ernst & Young
G H Meyerowitz
Partner
Perth
27 September 2010
GHM:NR:ILH:049
ACN120394194
ASXAdditionalInformation
AdditionalinformationrequiredbytheAustralianStockExchangeLimitedandnotshownelsewhere
inthisreportisasfollows.Theinformationiscurrentasat31August2010.
a) Distributionofequitysecurities
Ordinarysharecapital
86,511,333fullypaidordinarysharesareheldby866individualshareholders.
Allissuedordinarysharescarryonevotepershareandcarrytherightstodividends.
Thenumbersofshareholdersbysizeofholdingare:
11,000
9
1,0015000
123
5,00110,000
187
10,001100,000
455
100,001andover
92
866
Holdinglessthanamarketableparcel
0
b) Substantialshareholders
Ordinaryshareholders
FullyPaid
Number
Percentage
BKDavies
7,820,478
9.07
BJMaguire
5,820,552
6.75
GHGFowler
4,810,559
5.58
18,451,589
21.40
c) 20largestholdersofquotedequitysecurities
Ordinaryshareholders
LegalAustraliaPtyLtd<DaviesSuperFundA/c>
BJMaguire
JPOlivier
BobbinEdPtyLtd
GHGFowler
YearsPtyLtd<KordicFamilyNo1A/c>
RBCDexiaInvestorServicesAustraliaNomineesPtyLimited<BKCUSTA/c>
DR&GSands<SandsFamilyA/cNo2>
ACatelli&GPorter<Catelli/PorterSuperfundA/c>
GH&LPFowler<FowlerSuperFundA/c>
SP&EMSkinner<SkinnerSuperFundA/c>
AnglerfishPtyLtd<TheHemeryFamilyA/c>
BrendalisPtyLtd<TaylorFamilyA/c>
AloaPtyLimited
ABNAmroClearingSydneyNomineesPtyLtd<CustodianA/c>
JSDawkins
BBWhitford
MC&AJDouglass<DouglassSuperFundA/c>
JS&MADawkins<DawkinsSuperfundA/c>
AustralianShareFinancePtyLtd<BradleyMaguireSuperFundA/c>
FullyPaid
Number
7,812,821
4,670,552
3,068,340
2,881,772
2,724,996
2,645,465
2,500,000
2,268,340
2,191,672
2,070,250
2,055,000
2,000,349
2,000,349
1,736,428
1,677,310
1,660,282
1,500,000
1,333,334
1,250,000
1,150,000
Percentage
9.06
5.42
3.56
3.34
3.16
3.07
2.90
2.63
2.54
2.40
2.38
2.32
2.32
2.01
1.94
1.92
1.74
1.55
1.45
1.33
49,197,260
57.04
96

101.ASX IAW Sept 27 2010 17.39 Full Year Statutory Accounts

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101.ASX IAW Sept 27 2010 17.39 Full Year Statutory Accounts

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INTEGRATEDLEGALHOLDINGSLIMITED

Ms Tregonning is a graduate of The University of Western Australia, a Fellow of The Institute of

Mr Fowler is a business studies graduate of The University of Technology, Sydney, a Certified

Implementation of Board approved budget and Board monitoring of progress against

Auditor's Independence Declaration to the Directors of Integrated Legal

Ernst & Young

Liability limited by a scheme approved

d) No formal remuneration committee has been appointed. The remuneration of an executive

The total maximum remuneration of nonexecutive Directors is the subject of a shareholder

Qualitative factors considered include whether a relationship is strategically important, the

To promote effective communication with shareholders and encourage effective participation at

IAS 27 Consolidated and Separate Financial Statements Cost of an Investment in a

The revised Standard introduces a number of changes to

The cost of equitysettled transactions is recognised, together with a corresponding increase in

when the taxable temporary difference is associated with investments in subsidiaries,

when the deductible temporary difference is associated with investments in subsidiaries,

Theaccountingpoliciesusedbythe Groupinreportingsegmentsinternallyarethesame asthose

Independent audit report to members of Integrated Legal Holdings

Directors Responsibility for the Financial Report

Liability limited by a scheme approved

complying with Australian Accounting Standards (including the Australian Accounting

Report on the Remuneration Report

Ernst & Young

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