EX-99.3 4 ex99-3.htm

 

Exhibit 99.3

 

DIGINEX LIMITED

 

Directors’ statement and FINANCIAL STATEMENTS

 

For the financial year ended 31 March 2021

 

RESTRICTED

 

 
 

 

Table of Contents

 

Directors’ statement and financial statements for the financial year ended 31 March 2021 Page
   
Directors’ Statement 1
Independent Auditor’s Report 3
Consolidated Statement of Profit or Loss 8
Consolidated Statement of Comprehensive (Loss) Income 9
Consolidated Statement of Financial Position 10
Consolidated Statement of Changes in Equity 11-12
Consolidated Statement of Cash Flows 13
Non-consolidated Statement of Financial Position 16
Non-consolidated Statement of Changes in Equity 17
Notes to the Financial Statements 18

 

RESTRICTED

 

 
 

 

DIGINEX LIMITED

DIRECTORS’ STATEMENT

For the financial year ended 31 March 2021

 

The directors present their statement to the members together with the audited financial statements of the Group for the financial year ended 31 March 2021, the statement of financial position of the Company as at 31 March 2021 and the statement of change in equity of the Company for the financial year then ended.

 

In the opinion of the directors,

 

(a) the statement of financial position and the statement of changes in equity of the Company and the consolidated financial statements of the Group as set out on pages 8 to 89 are drawn up so as to give a true and fair view of the financial position of the Company as at 31 March 2021, the financial performance, changes in equity and cash flows of the Group and the changes in equity of the Company for the financial year ended on that date, and
(b) at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due.

 

Directors

 

The directors of the Company in office at the date of this statement are as follows:

 

Chi-Won Yoon   (Appointed on 30 September 2020)
Richard Anthony Byworth   (Appointed on 30 September 2020)
Paul Neil Ewing    
Andrew Watkins   (Appointed on 30 September 2020)
Richard Michael Petty   (Appointed on 30 September 2020)
Theng Siew Lian Lisa   (Appointed on 30 September 2020)
Paul Henry Smith   (Appointed on 30 September 2020)

 

Arrangements to enable directors to acquire shares and debentures

 

Neither at the end of nor at any time during the financial year was the Company a party to any arrangement whose object was to enable the directors of the Company to acquire benefits by means of the acquisition of shares in, or debentures of, the Company or any other body corporate, other than as disclosed under “Share options” in this statement and the following arrangements:

 

Convertible bonds

 

In May 2020 the Group issued a convertible bond. The bond converted in shares of Diginex HK, a subsidiary of the Company, prior to the completion of the Transaction with 8i Enterprises Acquisition Corp which resulted in the Company being listed on Nasdaq. The Transaction completed on 30 September 2020 and shares held in Diginex HK were swapped for shares in the Company. Certain directors of the Company invested in the convertible bond.

 

Salary deferral scheme

 

The Group implemented a salary deferral scheme. Certain directors deferred payment on a portion of their salaries and in return Diginex HK issued a corresponding share-based payment award equal to the deferred value. These shares were swapped into the Company shares on completion of the Transaction.

 

Salary paid in shares

 

A director elected to partial salary payment in shares. The shares entitled were accrued at the year end and were issued post year end.

 

Share awards

 

Non-executive directors were entitled to share awards during the year ended 31 March 2021 as per their service agreement with the Company. The share awards were accrued at the year end and were issued post year end.

 

1
 

 

Directors’ interests in shares or debentures

 

(a) According to the register of directors’ shareholdings, none of the directors holding office at the end of the financial year had any interest in the shares or debentures of the Company or its related corporations, except as follows:

 

  

Holdings registered in

name of director

  

Holdings in which a director is deemed to have an interest

 
  

At

31.3.2021

  

At 1.4.2020

or date of appointment,

if later

  

At

31.3.2021

  

At 1.4.2020

or date of appointment,

if later

 
Diginex Limited
(No. of ordinary shares)
                    
Chi-Won Yoon   1,955,908    1,746,346    -    - 
Richard Anthony Byworth   80,853    72,190    478,925    427,612 
Paul Neil Ewing   48,140    -    -    - 
Richard Michael Petty    -    -    106,792    95,350 
Paul Henry Smith   59,154    52,816    -    - 
Theng Siew Lian Lisa   29,569    26,401    -    - 
Andrew Watkins   -    -    -    - 

 

(b) According to the register of directors’ shareholdings, executive directors holding office at the end of the financial year had interests in options to subscribe for ordinary shares of the Company granted pursuant to the Employee Share Option Scheme as set out below and under “Share Options” below.

 

Share options

 

On 30 September 2020, upon completion of the Transaction, a replacement employee share options plan was established whereby the awardees of the Diginex HK share options scheme became entitled to 5,600,000 share options of the Company. Of the total amount, 1,960,000 share options were granted to the directors noted above.

 

The share options vest after 15 months in December 2021. Once the options are vested, they are immediately exercised and convert on a one-to-one basis into ordinary shares of the Company. The exercise price to one option is nil.

 

Accordingly, 5,600,000 ordinary shares were under option as at the year end.

 

The persons to whom the options have been issued have no right to participate by virtue of the options in any share issue of any other company. The Group has no legal or constructive obligation to repurchase or settle the options in cash.

 

On behalf of the directors

 

 
     
Richard Anthony Byworth   Paul Neil Ewing
Director   Director
26 August 2021    

 

2
 

 

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DIGINEX LIMITED

 

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS

 

Opinion

 

We have audited the financial statements of Diginex Limited (the Company) and its subsidiaries (the Group), which comprise the consolidated statement of financial position of the Group and the statement of financial position of the Company as at 31 March 2021, and the consolidated statement of profit or loss, consolidated statement of comprehensive (loss) income, consolidated statement of changes in equity and consolidated statement of cash flows of the Group, and statement of changes in equity of the Company for the year then ended, and a summary of significant accounting policies.

 

In our opinion, the accompanying consolidated financial statements of the Group and the statement of financial position and statement of changes in equity of the Company are properly drawn up in accordance with the provisions of the Singapore Companies Act, Chapter 50 (the Act), Singapore Financial Reporting Standards (International) (SFRS(I)s) so as to give a true and fair view of the consolidated financial position of the Group and the financial position of the Company as at 31 March 2021 and of the consolidated financial performance, consolidated changes in equity and consolidated cash flows of the Group and changes in equity of the Company for the year ended on that date.

 

Basis for opinion

 

We conducted our audit in accordance with Singapore Standards on Auditing (SSAs). Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the Accounting and Corporate Regulatory Authority (ACRA) Code of Professional Conduct and Ethics for Public Accountants and Accounting Entities (ACRA Code) together with the ethical requirements that are relevant to our audit of the financial statements in Singapore, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ACRA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

 

Key audit matters

 

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

 

Deemed reverse acquisition

 

Refer to note 1.1 (Summary of significant transactions), note 2.4 (Significant accounting estimates and judgements – Judgements - Deemed reverse acquisition), note 2.5 (Summary of significant accounting policies - Deemed reverse acquisition, note 6 (Other losses and expenses, net), note 24 (Share capital) and note 36 (acquisitions) to the consolidated financial statements.

 

3
 

 

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DIGINEX LIMITED (continued)

 

Key audit matters (continued)

 

Deemed reverse acquisition (continued)      

       

The key audit matter  

       

During the financial year, on 30 September 2020, the Company completed a share swap transaction (the Transaction) with 8i Enterprises and Diginex HK which led to the issuance of 31,688,392 shares (the Company had previously issued one founding share). Management considers that given the structure of the Transaction it is deemed that Diginex HK, from an accounting perspective, was the accounting acquirer with the previously consolidated Diginex HK results being recapitalized to reflect the shares issued to the former Diginex HK shareholders in relation to the Transaction.  

 

The Transaction resulted in a $43,995,869 non-cash Transaction expense under SFRS(I) 2.  

 

We focused on this area as this transaction significantly affected the financial position and performance of the Group and involves significant judgement in the absence of a SFRS(I) that specifically applies to such a transaction.

  

 
Our response

  

Our audit procedures in relation to management’s accounting for the Transaction included:

 

-holding discussions with senior management and the audit committee to understand the accounting policies applied in accounting for this deemed reverse acquisition.
   
-reviewing the presentation, supporting spreadsheets, memorandums prepared by management.
   
-inspecting supporting documents relevant to the deemed reverse acquisition and verifying the accuracy and relevance of the input data used such as the shares issued to 8i shareholders and service providers in consideration for shares in 8i Enterprises and to satisfy obligations arising from this transaction to the relevant board minutes and agreements.
   
-assessing the appropriateness of fair value of the non-cash consideration including shares and warrants used in determining the deemed consideration and evaluating the reasonableness of the fair value of the net identifiable assets acquired from 8i Enterprises.
   
-recalculating the transaction expense arising from this transaction and the reverse acquisition reserve for prior reporting periods and current period.
   
-considering the appropriateness of disclosures in the financial statements in describing the areas of judgement for the accounting policies applied.

 

Based on our work and evidence obtained, we found management approach towards transaction accounting to be reasonable. We also found the related disclosures in the financial statements to be adequate.

 

 

4
 

 

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DIGINEX LIMITED (continued)

 

Other information

 

Management is responsible for the other information. The other information comprises the information included in the directors’ statement, but does not include the financial statements and our auditor’s report thereon.

 

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

 

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

 

If, based on the work we have performed on the other information that we obtained prior to the date of this auditors’ report, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

 

Responsibilities of Management and directors for the financial statements

 

Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the provisions of the Act and SFRS(I)s, and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair financial statements and to maintain accountability of assets.

 

In preparing the financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

 

The directors’ responsibilities include overseeing the Group’s financial reporting process.

 

Auditors’ responsibilities for the audit of the financial statements

 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

 

As part of an audit in accordance with SSAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

 

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls.

 

5
 

 

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DIGINEX LIMITED (continued)

 

Auditors’ responsibilities for the audit of the financial statements (continued)

 

Obtain an understanding of internal controls relevant to the audit 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 Group’s internal controls.
   
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.
   
Conclude on the appropriateness of Management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.
   
Evaluate the overall presentation, structure and content of the financial statements including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
   
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

 

We communicate with the audit committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal controls that we identify during our audit.

 

We also provide the audit committee with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

 

From the matters communicated with the directors, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless the law or regulations preclude public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

6
 

 

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DIGINEX LIMITED (continued)

 

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

 

In our opinion, the accounting and other records required by the Act to be kept by the Company and by those subsidiary corporations incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act.

 

The engagement partner on the audit resulting in this independent auditor’s report is Xu Shuanghong.

 

 

UHY Lee Seng Chan & Co

 

Public Accountants and

Chartered Accountants

 

Singapore

 

26 August 2021

 

7
 

 

DIGINEX LIMITED

CONSOLIDATED STATEMENT OF PROFIT OR LOSS

For the financial year ended 31 March 2021

 

           

Year ended

31 March 2021

     

Year ended

31 March 2020

     

Year ended

31 March 2019

 
      Notes     USD       USD       USD  
                               
CONTINUING OPERATIONS                              
Revenue     3     287,468       494,622       950,064  
            287,468       494,622       950,064  
General and administrative expenses     4     (64,916,121 )     (42,984,644 )     (18,885,901 )
OPERATING LOSS           (64,628,653 )     (42,490,022 )     (17,935,837 )
                               
Other losses and expenses, net     6     (64,432,715 )     (1,699,067 )     (2,872,909 )
Impairment reversal (losses) on financial assets     7     21,071       (11,237,660 )     (5,589,772 )
Impairment of goodwill     17     -       -       (457,818 )
Finance costs, net     8     (2,271,445 )     (1,851,527 )     (1,139,211 )
Share of loss of an associate     9     -       -       (12,270,686 )
LOSS BEFORE TAX           (131,311,742 )     (57,278,276 )     (40,266,233 )
Income tax credit     10     478,078       -       -  
LOSS FROM CONTINUING OPERATIONS           (130,833,664 )     (57,278,276 )     (40,266,233 )
DISCONTINUED OPERATIONS                              
Profit (loss) from discontinued operations (attributable to the ordinary equity holders of the Company)     37     4,956,408       (857,554 )     56,986,946  
                               
(LOSS) PROFIT FOR THE YEAR           (125,877,256 )     (58,135,830 )     16,720,713  
(Loss) Profit attributable to:                              
Owners of the Company           (125,334,915 )     (57,716,069 )     16,810,157  
Non-controlling interests           (542,341 )     (419,761 )     (89,444 )
            (125,877,256 )     (58,135,830 )     16,720,713  
LOSS PER SHARE FOR LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO THE ORDINARY EQUITY HOLDERS OF THE COMPANY                              
Basic loss per share     11   $ (4.97 )   $ (3.80)     $ (2.90)  
                               
EARNINGS (LOSS) PER SHARE FOR PROFIT (LOSS) FROM DISCONTINUED OPERATIONS ATTRIBUTABLE TO THE ORDINARY EQUITY HOLDERS OF THE COMPANY                              
Basic earnings (loss) per share     11   $ 0.19     $ (0.06)     $ 4.11  
                               
(LOSS) EARNINGS PER SHARE FOR (LOSS) PROFIT ATTRIBUTABLE TO THE ORDINARY EQUITY HOLDERS OF THE COMPANY                              
Basic (loss) earnings per share     11   $ (4.78 )   $ (3.86)     $ 1.21  

 

The above consolidated statement of profit or loss should be read in conjunction with the accompanying notes.

 

8
 

 

DIGINEX LIMITED

CONSOLIDATED STATEMENT OF COMPREHENSIVE (LOSS) INCOME

For the financial year ended 31 March 2021

 

      

Year ended

31 March 2021

  

Year ended

31 March 2020

  

Year ended

31 March 2019

 
   Notes   USD   USD   USD 
                 
(LOSS) PROFIT FOR THE YEAR        (125,877,256)   (58,135,830)   16,720,713 
                     
OTHER COMPREHENSIVE (LOSS) INCOME                    
Exchange (loss) gain on translation of foreign operations        (525,878)   22,903    6,296 
Digital assets revaluation gain   22    429,789    -    - 
TOTAL COMPREHENSIVE (LOSS) INCOME FOR THE YEAR        (125,973,345)   (58,112,927)   16,727,009 
Total comprehensive (loss) income attributable to:                    
Owners of the Company        (125,431,004)   (57,693,166)   16,816,453 
Non-controlling interests        (542,341)   (419,761)   (89,444)
         (125,973,345)   (58,112,927)   16,727,009 
Total comprehensive (loss) income attributable to Owners of the Company arising from:                    
Continuing operations        (130,387,412)   (56,835,612)   (40,170,493)
Discontinued operations        4,956,408    (857,554)   56,986,946 
         (125,431,004)   (57,693,166)   16,816,453 

 

The above consolidated statement of comprehensive (loss) income should be read in conjunction with the accompanying notes.

 

9
 

 

DIGINEX LIMITED

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 March 2021

 

          At 31 March 2021     At 31 March 2020     At 31 March 2019  
      Notes       USD       USD       USD  
ASSETS                                
Intangible assets, net     12       14,845,896       10,669,116       -  
Property, plant and equipment, net     13       473,512       1,219,721       1,929,216  
Right-of-use assets, net     14       906,474       2,879,032       4,830,098  
Loan receivables, net of allowance     15       -       -       8,218,228  
Financial assets at fair value through profit or loss     16       304,053       449,011       2,087,580  
Prepayment, deposits and other receivables, non-current     18       152,988       1,246,947       1,246,947  
Amount due from an associate     19       -       -       1,991,988  
Non-current assets             16,682,923       16,463,827       20,304,057  
Trade receivables     18       12,604       72,652       104,298  
Prepayment, deposits and other receivables     18       3,256,771       1,808,179       192,482  
Amount due from an associate     19       -       977,421       -  
Amounts due from related companies     20       12,296       12,392       11,279  
Amounts due from shareholders     20       36,963       37,726       101,099  
Client assets     21       27,021,925       543,910       -  
Digital assets     22       348,998       36,034       -  
USDC     23       2,034,800       293,793       -  
Cash and cash equivalents             52,118,497       988,836       740,061  
Current assets             84,842,854       4,770,943       1,149,219  
TOTAL ASSETS             101,525,777       21,234,770       21,453,276  
EQUITY (DEFICIT)                                
Share capital     24       312,633,450       139,336,569       34,135,982  
Reverse acquisition reserve     24       (129,036,521 )     (85,180,290 )     (20,753,062 )
Share-based payment reserve     25       63,540,756       10,356,664       634,462  
Revaluation surplus     27       180,260       -       -  
Foreign currency translation reserve     27       (511,830 )     14,048       (8,855 )
Accumulated losses             (184,980,114 )     (68,186,372 )     (10,094,383 )
Shareholders’ equity (deficit) attributable to the owners of the Company             61,826,001       (3,659,381 )     3,914,144  
Non-controlling interests     27       (748,136 )     (205,795 )     (61,954 )
Total equity (deficit)             61,077,865       (3,865,176 )     3,852,190  
LIABILITIES                                
Lease liabilities, non-current     29       134,951       945,374       3,078,331  
Non-current liabilities             134,951       945,374       3,078,331  
Amount due to an associate     19       900,000       -       -  
Amounts due to related parties     20       203,460       -       -  
Amounts due to directors     20       6,785       374,604       356,855  
Loans from shareholders     20       -       10,711,563       10,406,249  
Amounts due to shareholders     20       -       1,686       -  
Client liabilities     21       27,021,925       543,910       -  
Warrant liability     26       5,197,201       -       -  
Lease liabilities, current     29       733,488       2,132,877       1,944,507  
Other payables and accruals     30       6,250,102       9,714,932       1,787,464  
Notes payable     31       -       675,000       27,680  
Current liabilities             40,312,961       24,154,572       14,522,755  
Total liabilities             40,447,912       25,099,946       17,601,086  
TOTAL EQUITY (DEFICIT) AND LIABILITIES             101,525,777       21,234,770       21,453,276  

 

The above consolidated statement of financial position should be read in conjunction with the accompanying notes.

 

10
 

 

DIGINEX LIMITED

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the financial year ended 31 March 2021

 

       Attributable to owners of the Group         
       Share capital   Reverse acquisition   Revaluation       Share-based payment   Foreign currency translation   Accumulated       Non-controlling   Total shareholders’ 
       Shares   Amount   reserve   surplus   Warrants   reserve   reserve   Losses   Total   interests   equity 
   Notes       USD   USD   USD   USD   USD   USD   USD   USD   USD   USD 
Balance at 1 April 2018   24    1,020,400    10,572,482    -    -    -    -    (15,151)   (285,077)   10,272,254    -    10,272,254 
Shares issued for cash during the year   24    7,424    2,412,868    -    -    -    -    -    -    2,412,868    -    2,412,868 
Shares issued for consulting services   24    990    242,635    -    -    -    -    -    -    242,635    -    242,635 
Shares issued as consideration for acquisition of a subsidiary   24    816    199,920    -    -    -    -    -    -    199,920    -    199,920 
Expenses related to raise of capital   24    -    (44,985)   -    -    -    -    -    -    (44,985)   -    (44,985)
Shares repurchased   24    (55,727)   -    -    -    -    -    -    (6,619,463)   (6,619,463)   -    (6,619,463)
Total income (loss) for the year        -    -    -    -    -    -    -    16,810,157    16,810,157    (89,444)   16,720,713 
Total other comprehensive income for the year        -    -    -    -    -    -    6,296    -    6,296    -    6,296 
Acquisition of a subsidiary   36    -    -    -    -    -    -    -    -    -    27,490    27,490 
Interim 2019 dividend   28    -    -    -    -    -    -    -    (20,000,000)   (20,000,000)   -    (20,000,000)
Equity-settled share-based payments   25    -    -    -    -    -    634,462    -    -    634,462    -    634,462 
Balance at 31 March 2019        973,903    13,382,920    -    -    -    634,462    (8,855)   (10,094,383)   3,914,144    (61,954)   3,852,190 
Recapitalization of Diginex HK
(1:13.9688 exchange ratio)
   24    12,630,313    20,753,062    (20,753,062)   -    -    -    -    -    -    -    - 
Balance at 31 March 2019        13,604,216    34,135,982    (20,753,062)   -    -    634,462    (8,855)   (10,094,383)   3,914,144    (61,954)   3,852,190 
                                                             
Balance at 1 April 2019   24    973,903    13,382,920    -    -    -    634,462    (8,855)   (10,094,383)   3,914,144    (61,954)   3,852,190 
Shares issued for cash during the year   24    214,753    31,831,174    -    -    -    -    -    -    31,831,174    -    31,831,174 
Shares issued for consulting services   24    17,081    2,709,854    -    -    -    -    -    -    2,709,854    -    2,709,854 
Shares issued for intangible assets   12    35,088    5,400,043                                  5,400,043         5,400,043 
Shares issued to employees   24    10,522    1,745,447    -    -    -    -    -    -    1,745,447    -    1,745,447 
Expenses related to raise of capital   24    -    (913,159)   -    -    -    -    -    -    (913,159)   -    (913,159)
Total loss for the year        -    -    -    -    -    -    -    (57,716,069)   (57,716,069)   (419,761)   (58,135,830)
Total other comprehensive income for the year        -    -    -           -         -    -    22,903    -    22,903    -    22,903 
Acquisition of a subsidiary   36    -    -    -    -    -    -    -    (375,920)   (375,920)   275,920    (100,000)
Equity-settled share-based payments   25    -    -    -    -    -    9,722,202    -    -    9,722,202    -    9,722,202 
Balance at 31 March 2020        1,251,347    54,156,279    -    -    -    10,356,664    14,048    (68,186,372)   (3,659,381)   (205,795)   (3,865,176)
Recapitalization of Diginex HK
(1:13.9688 exchange ratio)
   24    16,228,418    85,180,290    (85,180,290)   -    -    -    -    -    -    -    - 
Balance at 31 March 2020
(Note a)
        17,479,765    139,336,569    (85,180,290)   -    -    10,356,664    14,048    (68,186,372)   (3,659,381)   (205,795)   (3,865,176)
                                                             
Balance at 1 April 2020 (Note a)   24    1,251,347    54,156,279    -    -    -    10,356,664    14,048    (68,186,372)   (3,659,381)   (205,795)   (3,865,176)
Shares issued for cash during the six months to 30 September 2020   24    3,572    285,438    -    -    -    -    -    -    285,438    -    285,438 
Shares issued on conversion of convertible bond   24    318,311    25,436,232    -    -    -    -    -    -    25,436,232    -    25,436,232 
Shares issued for consulting services   24    595    47,546    -    -    -    -    -    -    47,546    -    47,546 
Shares issued for intangible asset purchase   12    3,899    600,056    -    -    -    -    -    -    600,056    -    600,056 
Shares issued to employees   24    9,114    728,300    -    -    -    -    -    -    728,300    -    728,300 
Shares issued to settle shareholder loan   20    9,039    722,306    -    -    -    -    -    -    722,306    -    722,306 
Equity-settled share-based payments   25    448    35,800    -    -    -    -    -    -    35,800    -    35,800 
Equity-settled earn-out awards   25    -    -    -    -    -    32,148,300    -    -    32,148,300    -    32,148,300 

 

11
 

 

       Attributable to owners of the Group         
       Share capital   Reverse acquisition   Revaluation       Share-based payment   Foreign currency translation   Accumulated       Non-controlling   Total shareholders’ 
       Shares   Amount   reserve   surplus   Warrants   reserve   reserve   Losses   Total   interests   equity 
   Notes       USD   USD   USD   USD   USD   USD   USD   USD   USD   USD 
Anti-dilutive share issuance   24    187,001    -    -    -    -    -    -    -    -    -    - 
Expenses related to raise of capital   24    6,382    (152,044)   -    -    -    -    -    -    (152,044)   -    (152,044)
Subtotal        1,789,708    81,859,913    -    -    -    42,504,964    14,048    (68,186,372)   56,192,553    (205,795)   55,986,758 
Recapitalization of Diginex HK
(1:13.9688 exchange ratio)
   24    23,210,292    129,019,911    (129,019,911)   -    -    -    -    -    -    -    - 
Subtotal        25,000,000    210,879,824    (129,019,911)   -    -    42,504,964    14,048    (68,186,372)   56,192,553    (205,795)   55,986,758 
Recapitalized with founding share of the Company   36    1    1    (16,610)   -    -    -    -    -    (16,609)   -    (16,609)
Acquisition of 8i Enterprises   36    6,688,392    56,851,332    -    -    8,324,147    -    -    -    65,175,479    -    65,175,479 
Subtotal        31,688,393    267,731,157    (129,036,521)   -    8,324,147    42,504,964    14,048    (68,186,372)   121,351,423    (205,795)   121,145,628 
Shares issued for services   24    27,334    285,160    -    -    -    -    -    -    285,160    -    285,160 
Shares issued for cash during the six months to 31 March 2021   24    2,571,669    21,980,647    -    -    -    -    -    -    21,980,647    -    21,980,647 
Expenses related to raise of capital   24    -    (1,636,312)   -    -    -    -    -    -    (1,636,312)   -    (1,636,312)
Shares issued in settlement of earn-out awards   25    3,030,000    7,241,700    -    -    -    (7,241,700)   -    -    -    -    - 
Shares issued for warrants exercised and warrants repurchased   26    1,480,965    17,031,098    -    -    (8,324,147)   -    -    8,291,644    16,998,595    -    16,998,595 
Equity-settled share-based payments   25    -    -    -    -    -    28,277,492    -    -    28,277,492    -    28,277,492 
Total loss for the year         -    -    -    -    -    -    -    (125,334,915)   (125,334,915)   (542,341)   (125,877,256)
Total other comprehensive loss for the year        -    -    -    180,260    -    -    (525,878)   249,529    (96,089)   -    (96,089)
Balance at 31 March 2021        38,798,361    312,633,450    (129,036,521)   180,260    -    63,540,756    (511,830)   (184,980,114)   61,826,001    (748,136)   61,077,865 

 

Note a – The balance of share capital as at 31 March 2020 has been recapitalized and reflected as such in the consolidated statement of financial position.

 

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

 

12
 

 

DIGINEX LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS
For the financial year ended 31 March 2021

 

      

Year ended

31 March

2021

  

Year ended

31 March

2020

  

Year ended

31 March

2019

 
   Notes   USD   USD   USD 
CASH FLOWS FROM OPERATING ACTIVITIES                    
Profit (Loss) before tax from:                    
Continuing operations        (131,311,742)   (57,278,276)   (40,266,233)
Discontinued operations        4,956,408    (857,554)   56,986,946 
PROFIT (LOSS) INCLUDING DISCONTINUED OPERATIONS        (126,355,334)   (58,135,830)   16,720,713 
Adjustments for:                    
Gain on bargain purchase of a subsidiary        -    -    (82,470)
Net gain on fair value on equity method investment   6    -    -    (11,030,339)
Impairment of goodwill   17    -    -    457,818 
Impairment (reversal) losses   7    (21,071)   11,237,660    5,589,772 
Finance costs   8    1,036,104    1,851,527    1,139,285 
Transaction cost associated with private warrants   8    1,235,341    -    - 
Net gain from change in fair value on financial liabilities through profit or loss   26    (11,397,187)   -    - 
Revaluation loss on Digital assets through profit or loss   22    68,360    -    - 
Net fair value losses on financial assets at fair value through profit or loss   6    144,109    1,527,158    2,590,853 
Net loss on sale of financial assets at fair value through profit or loss   6    -    221,626    11,665,824 
Depreciation – property, plant and equipment   13    817,597    791,714    575,109 
Loss on disposal – property, plant and equipment   13    36,300    -    - 
Depreciation – right-of-use assets   14    1,963,787    1,965,711    1,387,004 
Share of loss of an associate   9    -    -    12,270,686 
Impact on reclassification to short term lease        (32,588)   -    - 
Amortization – Intangible assets   12    2,021,722    -    - 
Shares issued for consulting services   24    332,706    2,709,854    242,635 
Shares issued to employees   24    715,834    -    - 
Equity-settled share-based payments   24    35,800    -    - 
Equity settled share-based payments – employee share option scheme and accrued share awards   5    28,901,004    11,397,317    634,462 
Earn-out share awards   6    32,148,300    -    - 
Transaction expense   36    43,995,869    -    - 
Discontinued operations   37    (5,987,534)   70,331    (58,824,071)
         (30,340,881)   (26,362,932)   (16,662,719)
Changes in:                    
Trade receivables        60,048    (81,735)   (212,298)
Prepayment, deposits and other receivables        (1,285,134)   (1,615,696)   (1,275,075)
Income tax payable        -    (27,680)   - 
Client assets        (26,478,015)   (543,910)   - 
Client liabilities        26,478,015    543,910    - 
Amounts due from related companies        -    (1,113)   (9,856)
Amounts due to related companies        203,460    -    - 
Other payables and accruals        (6,066,606)   7,846,029    1,379,759 
Amounts due to directors        (367,819)   17,749    334,374 
Advance to an associate company        -    (226,308)   (1,991,988)

 

13
 

 

      

Year ended

31 March

2021

  

Year ended

31 March

2020

  

Year ended

31 March

2019

 
   Notes   USD   USD   USD 
Amounts due to shareholders        (1,686)   1,686    (510,349)
Amounts due from shareholders        765    63,372    520,315 
Digital assets   22    48,465    (36,034)   - 
USDC   23    (1,741,007)   (293,793)   - 
Discontinued operations        -    -    (607,741)
Cash used in operating activities        (39,490,395)   (20,716,455)   (19,035,578)
Finance costs paid        (387,366)   (1,561,094)   (419,536)
Income tax credit received   10    478,078    -    - 
Net cash used in operating activities        (39,399,683)   (22,277,549)   (19,455,114)
CASH FLOWS FROM INVESTING ACTIVITIES                    
Purchase of property, plant and equipment   13    (49,743)   (69,875)   (2,373,518)
Acquisition of subsidiaries, net of cash acquired   36    (75,000)   (25,000)   (123,609)
Cash received on completion of Transaction   36    24,149,575    -    - 
Sales of financial assets through profit or loss        -    155,951    33,992,480 
Investment in financial assets through profit or loss   16    -    (267,773)   (3,811,256)
Acquired software and capitalized software development   12    (5,652,943)   (5,269,116)   - 
Discontinued operations        -    -    (15,550,618)
Net cash generated from (used in) investing activities        18,371,889    (5,475,813)   12,133,479 
CASH FLOWS FROM FINANCING ACTIVITIES                    
Loan receivables   15    -    (479,749)   (15,700,000)
Repayment of loan receivables        -    -    2,000,000 
Loan to an associate   19    -    (2,000,000)   - 
Repayment of amounts due from an associate   19    951,781    814,572    - 
Advance from an associate   19    900,000    -    - 
Advance to a director        -    -    (1,000,000)
Repayment of advance of a director        -    -    1,000,000 
Payment of lease liabilities   29    (2,399,147)   (2,390,366)   (1,645,620)
Proceeds from issues of share capital, net   24    255,438    30,918,015    2,367,883 
Proceeds from issues of private placement shares, net of expenses   24    20,626,394    -    - 
Proceeds from issues of private placement warrants, net of expenses   26    15,571,989    -    - 
Proceeds from issues of public warrant shares   26    17,031,098    -    - 
Proceeds from loans from shareholders   20    100,000    5,332,303    14,625,561 
Repayment of loans from shareholders   20    (3,949,050)   (4,850,000)   (4,508,829)
Payments for shares repurchase   24    -    -    (3,144,943)
Proceeds from notes payable   31    -    675,000    - 
Repayment of notes payable   31    (675,000)   -    - 
Proceeds from convertible bond, net of expenses   32    24,272,539    -    - 
Proceeds from third-party loan        -    -    10,000,000 
Repayment of third-party loan        -    -    (10,000,000)
Dividend Paid   28    -    -    (20,000,000)
Discontinued operations   37    -    -    27,949,691 
Net cash generated from financing activities        72,686,042    28,019,775    1,943,743 
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS        51,658,248    266,413    (5,377,892)
Cash and cash equivalents at the beginning of the period        988,836    740,061    6,111,657 
Effect of foreign exchange rate changes        (528,587)   (17,638)   6,296 
CASH AND CASH EQUIVALENTS AT 31 MARCH        52,118,497    988,836    740,061 

 

14
 

 

Non-cash investing and financing activities

 

Non-cash investing and financing activities for the year ended 31 March 2021, as disclosed in the notes, are:

 

  Acquisition of intangible assets through the issuance of Diginex HK shares valued at $600,056 (note 12)
  Addition to right-of-use assets and lease liabilities of $406,333 (notes 14 and 29)
  Settlement of loans from shareholders of $722,306 via issuance of shares in Diginex HK (note 20.6)
  Settlement of loans from shareholders of $100,000 via issuance of a convertible bond (note 20.6)
  Settlement of deferred compensation from the salary deferral scheme of $485,000 via issuance of convertible bonds (note 32)
  Conversion of convertible bonds and accrued interest into shares in Diginex HK of $25,436,232 (note 24)
  Issue of earn-out shares of 3,030,000 from the earn-out share based payment reserve of $7,241,700 (note 25)
  Accrual of transaction costs of $495,000 payable to a service provider associated with the private placement (note 26.2)

 

Non-cash investing and financing activities for the year ended 31 March 2020, as disclosed in the notes, are:

 

  Loan novation of $4,323,530 from a loan receivable to an amount due from an associate (notes 15 and 19)
  Acquisition of intangible assets amounting to $5,400,043 through the issuance of Diginex HK shares (note 12), and
  Outstanding payable of $75,000 on acquisition of remaining interest in Bletchley Park Asset Management Jersey Limited (note 36).

 

Non-cash investing and financing activities during the year ended 31 March 2019, are:

 

  Adoption of SFRS(I) 16, Leases, resulting in the recognition of right-of-use assets and lease liabilities of $5,768,624,
  Diginex HK shares repurchased through allocation of Madison Group Holdings Limited stock which Diginex HK took ownership of as consideration of the partial divestment of DHPC valued at $3,474,520, and
  Purchase of DHPC property, plant and equipment through financing (discontinued operations) $25,549,556.

 

The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.

 

15
 

 

DIGINEX LIMITED

Non-CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 March 2021

 

       At 31 March   At 31 March 
       2021   2020 
   Notes   USD   USD 
ASSETS               
Non-current assets               
Investment in subsidiaries   35    277,675,480    1 
                
Total non-current assets        277,675,480    1 
                
Current assets               
Prepayment, deposits and other receivables   18    192,479    2,193 
Amount due from a shareholder   38    1    1 
Amounts due from subsidiaries   38    21,886,063    - 
Cash and cash equivalents        51,271,019    - 
                
Total current assets        73,349,562    2,194 
                
TOTAL ASSETS        351,025,042    2,195 
                
EQUITY AND LIABILITIES               
EQUITY               
Equity attributable to owners of the Company               
Share capital (a)        314,253,626    1 
Share-based payment reserve   25    44,614,503    - 
Accumulated losses        (14,953,265)   (15,127)
Total equity        343,914,864    (15,126)
                
LIABILITIES               
                
Current liabilities               
Other payables and accruals   30    768,418    11,000 
Amounts due to subsidiaries   38    1,144,559    6,321 
Warrant liability   26    5,197,201    - 
                
Total current liabilities        7,110,178    17,321 
                
Total liabilities        7,110,178    17,321 
                
TOTAL EQUITY AND LIABILITIES        351,025,042    2,195 

 

Note a – Share capital in the non-consolidated statement of financial position is greater than the share capital in the consolidated statement of financial position as a result of the deemed reverse acquisition method of accounting. The share capital in the consolidated statement of financial position includes $1,620,176 of capitalized expenses related to the raise of capital within Diginex HK. Capital raise expenses are not deemed as part of legal share capital of the Company and remain in equity as part of the continuation of the accounting acquirer, Diginex HK. See note 2.5 for details for deemed reverse acquisition accounting policy.

 

16
 

 

DIGINEX LIMITED

Non-CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the financial year ended 31 March 2021

 

   Share capital   Warrants   Share-based payment reserve   Accumulated losses   Total 
   USD  </