UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549  FORM 20   (Mark One)   ̈
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR  x
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended OR   ̈
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period
from             to OR   ̈
    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of event requiring
this shell company report Commission file number
[        ]   Integrated Media Technology Limited Integrated Media Technology
Limited (Formerly known as China
Integrated Media Corporation Limited) (Exact name of Registrant as
specified in its charter and translation of Registrant's
name into English) Australia (Jurisdiction of incorporation
or organization)  Mr. Con Unerkov, Non-executive
Director Level 7, 420 King William
Street, Adelaide, SA 5000, Australia Phone +61 8 7324 6018
   Fax:+61 8 8312 0248   (Address of principal executive
offices)  Securities registered or to be registered pursuant
to Section 12(b) of the Act.  Title
        of each class
    
    Name of
        each exchange on which registered
        or to be registeredOrdinary Shares
    
    The NASDAQ Capital Market Securities registered or
to be registered pursuant to Section 12(g) of the Act. None Securities for which there
is a reporting obligation pursuant to Section 15(d) of the Act. None Indicate the number of outstanding
shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report. The number of ordinary
shares, as of March 28, 2018 is 2,643,611 Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ̈YesxNo If
this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934. ̈YesxNo Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. ̈Yes ̈No Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ̈Yes ̈No Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated
filer" in Rule 12b-2 of the Exchange Act. (Check one):  Large accelerated filer ̈
    
    Accelerated filer ̈
    
    Non-accelerated filerx Indicate by check mark which
basis of accounting the registrant has used to prepare the financial statements included in this filing:  U.S. GAAP ̈
    
    International Financial Reporting Standards as issuedby the International Accounting Standards Board
    x
    
    
    Other ̈ If
"Other" has been checked in response to the previous question, indicate by check mark which financial statement item
the registrant has elected to follow. ̈Item 17 ̈Item 18 If
this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). ̈YesxNo      TABLE
OF CONTENTS  INTRODUCTION
    1PART
    I
    2Item
    1.
    Identity
    of Directors, Senior Management and Advisers
    2Item
    2.
    Offer
    Statistics and Expected Timetable
    2Item
    3.
    Key
    Information
    2Item
    4.
    Information
    on the Company
    22Item
    4A.
    Unresolved
    Staff Comments
    45Item
    5.
    Operating
    and Financial Review and Prospects
    46Item
    6.
    Directors,
    Senior Management and Employees
    55Item
    7.
    Major
    Shareholders and Related Party Transactions
    63Item
    8.
    Financial
    Information
    65Item
    9.
    The
    Offer and Listing
    66Item
    10.
    Additional
    Information
    67Item
    11.
    Quantitative
    and Qualitative Disclosures About Market Risks
    78Item
    12.
    Description
    of Securities Other than Equity Securities
    78PART
    II
    
    79Item
    13.
    Defaults,
    Dividend Arrearages and Delinquencies
    79Item
    14.
    Material
    Modifications to the Rights of Security Holders and Use of Proceeds
    79Item
    15.
    Controls
    and Procedures
    79Item
    15T
    Controls
    and Procedures
    80Item
    16
    Reserved
    80Item
    16A.
    Audit
    Committee Financial Expert
    80Item
    16B.
    Code
    of Ethics
    80Item
    16C.
    Principal
    Accountant Fees and Services
    80Item
    16D.
    Exemptions
    from the Listing Standards for Audit Committees
    81Item
    16E.
    Purchases
    of Equity Securities by the Issuer and Affiliated Purchasers
    81Item
    16F.
    Change
    in Registrant's Certifying Accountant
    81Item
    16G.
    Corporate
    Governance
    81Item
    16H.
    Mine
    Safety Disclosure
    81PART
    III
    
    82Item
    17.
    Financial
    Statements
    82Item
    18.
    Financial
    Statements
    82Item
    19.
    Exhibits
    83SIGNATURES
    84   i     INTRODUCTION Integrated
Media Technology Limited was incorporated under the laws of the Commonwealth of Australia on August 8, 2008. As used in this annual
report, the terms "we," "us," "our", "IMT", and the "Company" mean
Integrated Media Technology Limited and its subsidiaries, unless otherwise indicated. Our
consolidated financial statements appearing in this annual report on Form 20-F are prepared in Australian dollars and in accordance
with the International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board, or IASB.
Our consolidated financial statements appearing in this annual report on Form 20-F comply with both the IFRS and Australian equivalents
to IFRS, or A-IFRS. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply
with IFRS. In
this annual report, all references to "U.S. dollars" or "US$" are to the currency of the United States
of America, and all references to "Australian dollars" or "A$" are to the currency of Australia. Statements
made in this annual report on Form 20-F concerning the contents of any contract, agreement or other documents are summaries of
such contracts, agreements or documents and are not complete descriptions of all of their terms. If we filed any of these documents
as an exhibit to this annual report or to any annual report that we previously filed, you may read the document itself for a complete
description of its terms. Except
for the historical information contained in this annual report on Form 20-F, the statements contained in this annual report on
Form 20-F are "forward-looking statements" which reflect our current view with respect to future events and financial
results. We urge you to consider that statements which use the terms "anticipate," "believe," "do
not believe," "expect," "plan," "intend," "estimate," and similar expressions
are intended to identify forward-looking statements. We remind investors that forward-looking statements are merely predictions
and therefore inherently subject to uncertainties and other factors and involve known and unknown risks that could cause the actual
results, performance, levels of activity, or our achievements, or industry results, to be materially different from any future
results, performance, levels of activity, or our achievements expressed or implied by such forward-looking statements. Investors
are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Except
as required by applicable law, including the securities laws of the United States, we undertake no obligation to publicly release
any update or revision to any forward-looking statements to reflect new information, future events or circumstances, or otherwise
after the date hereof. Please see the Risk Factors section that appears in "Item 3. Key Information - D. Risk Factors."   1     PART
I   ITEM
    1.
    
    IDENTITY
    OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS  Not
applicable.   ITEM
    2.
    
    OFFER
    STATISTICS AND EXPECTED TIMETABLE  Not
applicable.   ITEM
    3.
    
    KEY
    INFORMATION  A.
    
    Selected
    Financial Data  Our
    consolidated financial statements appearing in this annual report on Form 20-F comply with both the International Financial
    Reporting Standards, or IFRS, as issued by the International Accounting Standards Board and Australian equivalents to IFRS,
    or A-IFRS. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with
    IFRS.  The
    following selected consolidated financial data as of December 31, 2017 and 2016 and for the fiscal years ended December 31,
    2017, 2016 and 2015 have been derived from our audited consolidated financial statements and notes thereto included elsewhere
    in this annual report on Form 20-F, on a post-reverse split basis. This data should be read together with, and is qualified
    in its entirety by reference to, "Item 5. Operating and Financial Review and Prospects" as well as our consolidated
    financial statements and notes thereto appearing in "Item 18. Financial Statements" of this annual report on Form
    20-F.  The
selected financial data are presented in Australian dollars (A$) (except as otherwise noted).  Consolidated
Statement of Profit or Loss and other Comprehensive Income Data:  Year
    Ended December 31,2017
    
    2016
    
    2015
    
    2014
    
    2013(Audited)
    
    (Audited)
    
    (Audited)
    
    (Audited)
    
    (Audited)(in
    A$, except share amounts)Total
    revenue
    
    10,153,636
    
    14,039,248
    
    7,306,699
    
    597,626
    
    1,576,139Cost
    of sales
    
    (2,548,064)
    
    (2,027,743)
    
    (2,984,291)
    
    (263,805)
    
    (1,095,642)Depreciation
    and amortization expenses
    
    (2,021,131)
    
    (2,147,231)
    
    (383,635)
    
    (124,335)
    
    (108,927)Corporate
    administrative expenses
    
    (2,522,927)
    
    (2,447,545)
    
    (1,432,564)
    
    (389,868)
    
    (662,120)Loss
    on financial assets at fair value through profit or loss
    
    -
    
    -
    
    -
    
    (551,787)
    
    -Loss
    on disposal of a subsidiary
    
    -
    
    (872)
    
    -
    
    -
    
    -Other
    operating expenses
    
    (1,448,960)
    
    (1,728,184)
    
    (506,245)
    
    (167,339)
    
    (50,751)Finance
    costs
    
    (107,101)
    
    (73,666)
    
    -
    
    -
    
    -Income
    tax credit / (expense)
    
    187,213
    
    (2,018,939)
    
    356,158
    
    -
    
    -Net
    profit / (loss)
    
    1,692,666
    
    3,595,068
    
    2,356,122
    
    (899,508)
    
    (341,301)Profit / (loss)
    per share - basic and diluted (post-reverse split)
    
    64
    cents
    
    137
    cents
    
    118
    cents
    
    (51
    cents)
    
    (20
    cents)Weighted average
    number of ordinary shares outstanding (post-reverse split)
    - basic and diluted
    
    2,643,611
    
    2,643,611
    
    1,922,143
    
    1,763,762
    
    1,677,122     2     Consolidated
Statement of Financial Position Data:   As
    of December 312017
    
    2016
    
    2015
    
    2014
    
    2013(Audited)
    
    (Audited)
    
    (Audited)
    
    (Audited)
    
    (Audited)Cash
    and cash equivalents
    
    2,860,014
    
    1,820,994
    
    6,883,196
    
    2,227,715
    
    1,422,757Working
    capital
    
    5,478,132
    
    8,263,311
    
    7,642,256
    
    3,030,501
    
    3,383,367Total
    assets
    
    35,859,449
    
    43,481,437
    
    37,271,467
    
    3,392,353
    
    3,878,049Long-term
    debt
    
    16,748,877
    
    22,657,065
    
    24,464,929
    
    -
    
    -Total
    shareholders' equity
    
    15,390,334
    
    14,354,982
    
    11,086,012
    
    3,305,937
    
    3,837,438  (1)
    All
    previously reported share and per share amounts have been restated to reflect the reverse stock split of thirty-to-one effective
    on May 8, 2017.   Exchange
Rate Information: The
Company publishes its consolidated financial statements in Australian dollars. In this annual report and the annual report, references
to dollars, "$" or "A$" are to Australian dollars currency and references to "U.S. dollars"
or "US$" are to U.S. currency. Solely for informational purposes, this annual report and the annual report contains
translations of certain Australian dollars into or from U.S. dollars at specified rates. These translations should not be construed
as representations that the Australian dollars amounts actually represent such U.S. dollar amounts or could be converted into
or from U.S. dollars at the rate indicated or at any other rate. Unless otherwise stated herein, the translations of Australian
dollars into or from U.S. dollars have been made at $1.00 to US$0.7815, the buying rate on December 31, 2017.  The
following tables set forth, for the periods and dates indicated, certain information regarding the rates of exchange of A$1.00
into US$ based on the noon market buying rate in New York City for cable transfers in Australian dollars as certified for customs
purposes by the Federal Reserve Bank of New York, or the noon buying rate. The period average data set forth below is the average
of the last day of each full month during the period. Exchange
rate as of the latest practicable date, March 23, 2018: A$1.00 is US$0.7721  Year
        Ended December 31,
    
    At
    Period End
    
    Average
    Rate
    
    High
    
    LowUS$
    
    US$
    
    US$
    
    US$2013
    
    0.8929
    
    0.9683
    
    1.0579
    
    0.88582014
    
    0.8173
    
    0.9034
    
    0.9488
    
    0.80972015
    
    0.7286
    
    0.7522
    
    0.8212
    
    0.69172016
    
    0.7230
    
    0.7445
    
    0.7817
    
    0.68552017
    
    0.7815
    
    0.7671
    
    0.8071
    
    0.7230  Month
    
    High
    
    LowUS$
    
    US$July
    2017
    
    0.7991
    
    0.7584August
    2017
    
    0.7983
    
    0.7822September
    2017
    
    0.8071
    
    0.7831October
    2017
    
    0.7885
    
    0.7660November
    2017
    
    0.7722
    
    0.7551December
    2017
    
    0.7815
    
    0.7507January
    2018
    
    0.8105
    
    0.7822February
    2018
    
    0.8028
    
    0.7789   B.
    
    Capitalization
    and Indebtedness  Not
applicable.   C.
    
    Reasons
    for the Offer and Use of Proceeds  Not
applicable.    3     D.
    
    Risk
    Factors  The
following risks relate specifically to our business and should be considered carefully. Our business, financial condition and
results of operations could be harmed by any of the following risks. The risks and uncertainties described below are not the only
ones that we face. Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial
may also adversely affect our business. If any of the following risks and uncertainties develops into actual events, our business,
financial condition and results of operations could be materially and adversely affected, and the trading price of our ordinary
shares could decline. As a result of the above factors, the trading price of our ordinary shares could decline and the holders
could lose part or all of their investment. Risks
Related to Our Business We
have a history of operating losses until recently and may not maintain profitability in the future We
are a company at an early stage in the development of its 3D products and our success is uncertain. Unless we are able to generate
sufficient and consistent product revenue, we will incur losses from operations and may not achieve or maintain profitability.
As of December 31, 2017, we had a retained surplus of A$5,285,565. For the year ended December 31, 2017 we recorded profit
of A$1,692,666. The profit was the result of sales of our ASD products and software, technology solutions and 2D to 3D auto conversion
workstations, and the write-down of the fair value of contingent consideration liability in the amount of A$3,953,537 in relation
to the acquisition of Marvel Digital Limited. The Group's business declines as compared to the prior year due to the one-off
sales of our software and technology solutions amounting to approximately $8,390,000 in 2016. Unless we continue to sell these
3D products and services, we may incur losses from operations and we expect the costs of 3D development to increase over the next
years as we continue to innovate our technologies and products. Because of the numerous risks and uncertainties associated with
the development, manufacturing, sales and marketing of 3D products and services, we may experience lesser profits or even losses,
and may never become profitable again. Our current or any future products many not be successfully developed, and if successfully
developed, may not generate sufficient revenue to enable us to maintain profitability. If
we fail to remain profitable, or if we are unable to fund our continuing operations, our business will be harmed and the holders
of our ordinary shares could lose all or part of their investment. There is a substantial risk that we may not be able to complete
the development of our current 3D products or develop other 3D products. We will rely on 2D to 3D auto conversion workstation
and our other 3D products to generate revenues for us in the future. It is possible that none of them will be successfully commercialized,
which would prevent us from maintaining profitability. We
have a limited operating history, and it may be difficult for potential investors to evaluate our business  The
3D display operation commenced in 2013 and our audio division was started in 2015, both with relatively short history. Our limited
operating history makes it difficult for potential investors to evaluate our business or prospective operations with long term
view. We are subject to all the risks inherent in the initial organization, financing, expenditures, complications and delays
inherent in a relatively new business. Both our display and audio businesses faced delays in sales and financing from suppliers
due to our new entry into the market. Our products are new in the market and face challenges in consumer recognition and acceptance,
where more established players and products have better resources to penetrate the markets. Moreover as a new entrant in the competitive
electronics market, we face many questions on our company, organization, finances and product information before electronic distributors
are willing to carry our products into their network. Thus it takes additional time to establish distributor network for our products
and also for these distributors to accept our products into their network. Our products may never be accepted by distributors
and thereby hinder our ability to sell our products in the target markets. Investors should evaluate an investment in us in light
of the uncertainties encountered by such companies in a competitive environment. Our business is dependent upon the implementation
of our business plan, as well as the ability of our continuous innovation of both the 3D products and audio products. There can
be no assurance that our efforts will be successful or that we will be able to attain profitability. We
will require additional financing in the future to sufficiently fund our operations, research and development activities We
have been incurred losses until 2015 and we may incur losses in the future as we continue our 3D development. Our actual cash
requirements may vary from those now planned and will depend upon many factors, including: the continued progress of our research
and development programs; the timing, costs and results of product development; the commercial potential of our products; our
ability to outsource manufacturing capabilities; and the status and timing of competitive developments. We
anticipate that as the development of 3D products and its associated costs increase we will require additional funds to achieve
our long-term goals of commercialization and further development of other 3D products. In addition, we will require funds to defend
intellectual property rights, outsource manufacturing capacity, develop marketing and sales capability and fund operating expenses.
We intend to seek such additional funding through public or private financings and/or through licensing of our intellectual properties
or other arrangements with corporate partners. However, such financing, licensing opportunities or other arrangements may not
be available from any sources on acceptable terms, or at all. Any shortfall in funding could result in our having to curtail or
cease our operations including our research and development activities, which would harm our business, financial condition and
results of operations.   4     We
have limited cash resources and if we cannot raise additional funds or generate more revenues, we will not be able to pay our
vendors and will probably not be able to continue as a going concern  We
will need to raise additional funds to pay outstanding debts, vendor invoices and execute our business plan. Our future cash flows
depend on our ability to enter into, and be paid under, contracts with our distributors for the 3D and consumer electronics business.
There can be no assurance that additional funds will be available when needed from any source or, if available, will be available
on terms that are acceptable to us.  We
may be required to pursue sources of additional capital through various means, including joint venture projects and debt or equity
financings. Future financings through equity investments will be dilutive to existing stockholders. Also, the terms of securities
we may issue in future capital transactions may be more favorable for our new investors. Newly issued securities may include preferences,
superior voting rights, and the issuance of warrants or other convertible securities, which will have additional dilutive effects.
Further, we may incur substantial costs in pursuing future capital and/or financing, including investment banking fees, legal
fees, accounting fees, printing and distribution expenses and other costs. We may also be required to recognize non-cash expenses
in connection with certain securities we may issue, such as convertible notes and warrants, which will adversely impact our financial
condition and results of operations.  Our
ability to obtain needed financing may be impaired by such factors as the weakness of capital markets and the fact that we only
have been profitable in the past 3 years, which could impact the availability or cost of future financings. If the amount of capital
we are able to raise from financing activities, together with our revenues from operations, is not sufficient to satisfy our capital
needs, even to the extent that we reduce our operations accordingly, we may be required to cease operations.  Our
limited operating history and rapidly evolving business makes it difficult for us to accurately forecast revenues and expenses  We
have a limited operating history on which to base an evaluation of our business and prospects. Our operating results may fluctuate
as a result of a number of factors, many of which are outside of our control. For these reasons, comparing our operating results
on a period-to-period basis may not be meaningful, and you should not rely on our past results as an indication of our future
performance. Our prospects must be considered in light of inherent risks, expenses, and difficulties encountered by companies
in their early stages of development, particularly in new and evolving markets.  We
have generated profits for the past few years from our limited success in our ASD products and software, and 2D to 3D auto conversion
workstations and the audio in 2015. However our future prospects are uncertain in light of the risks and uncertainties experienced
by early stage companies in evolving electronic technology industries. Due to our short history, it is difficult for us to predict
future revenues and operating expenses. We based our expense levels, in part, on our expectations of future revenues from anticipated
transactions. If our 3D and audio business develops slower than we expect, our profit may decline or we may incur losses, we may
then have to curtail part of our business plan and the market price of our stock may decline.  Some
of the other risks and uncertainties of our business relate to our ability to:  -
 offer new and innovative 3D products and services to attract and retain customer base; -
 attract customers; -
 increase awareness of our audio brand and continue to develop consumer and customer loyalty; -
 respond to competitive market conditions; -
 respond to changes in our regulatory environment; -
 manage risks associated with intellectual property rights; -
 maintain effective control of our costs and expenses; -
 raise sufficient capital to sustain and expand our business; -
 attract, retain and motivate qualified personnel; and -
 upgrade our technology to support increased traffic and expanded services.  If
we are unsuccessful in addressing any of these risks and uncertainties, our business may be materially and adversely affected.   5     The
development of our business is dependent upon the completion and integration of acquisitions and other transactions that have
only recently closed or incurred in the future  Our
principal focus is on our 3D products and services businesses. Even when we close acquisitions like Marvel Digital Limited ("MDL"),
our business will not be successful if we are unable to successfully operate and integrate the businesses we acquire. Accordingly,
it is difficult to evaluate our business based upon our historical financial results. We expect to continually look for new businesses
to acquire to develop and grow our operations. If we fail to identify such business, or are unable to acquire such businesses
on reasonable terms, or fail to successfully integrate such businesses, our operating results and prospects could be harmed.  Our
audio business depends on a strong brand, and if we are not able to maintain and enhance the brand, our business and operating
results may be harmed  We
believe that recognition of the audio brand will contribute significantly to the success of our business. We also believe that
maintaining and enhancing our brand is critical to expanding our customer base. As our market becomes increasingly competitive,
maintaining and enhancing our brand will depend largely on our ability to fund the advertising and promotion campaigns, which
may be increasingly difficult and expensive.  We
face significant competition and may suffer from a loss of customers as a result  We
expect to face significant competition in our 3D display and audio businesses, particularly from other companies that seek to
provide similar products and services. Many of these competitors have significantly greater financial resources and more personnel
than we do. They may also have longer operating histories and more experience in attracting, retaining and managing customers.
They may use their experience and resources to compete with us in a variety of ways, including by competing more for users, customers,
distributors, media channels and by investing more heavily in research and development and making acquisitions. If we fail to
compete effectively, our business, financial condition and results of operation will be adversely affected.  Our
research and development efforts will be seriously jeopardized if we are unable to attract and retain key personnel and cultivate
key academic and scientific collaborations  We
are a company with 53 employees as of December 31, 2017. Our success is highly dependent on the continued contributions of our
principal management and technology personnel and on our ability to develop and maintain important relationships with leading
academic institutions. Competition among technology companies for qualified employees is intense, and we cannot be certain that
we will be able to continue to attract and retain qualified scientific and management personnel critical to our success. We also
have relationships with leading academic and technology collaborators who conduct research at our request or assist us in formulating
our research and development strategies. These academic and technology collaborators are not our employees and may have commitments
to, or consulting or advisory contracts with, other entities that may limit their availability to us.  We
may need to rely on the marketing and distribution capabilities of third parties for our GOXD picture frame business  We
currently have limited experience in marketing, sales or distribution of consumer electronics products such as our newly developed
GOXD picture frame business. If our newly developed GOXD picture frame enters into the consumer electronics category, we may be
required to enter into marketing arrangements with other parties who have established appropriate marketing, sales and distribution
capabilities. We cannot make any assurances that we will be able to enter into marketing arrangements with any marketing partner
or that if such arrangements are established, our marketing partners will be able to commercialize our products successfully.
Other companies offering similar or substitute products may have well-established and well-funded marketing and sales operations
in place that will allow them to market their products more successfully. Failure to establish sufficient marketing capabilities
may have a material adverse impact on our potential revenues and results of operations. Alternatively, if we decide to perform
our own sales and marketing activities,we will require additional management, will need to hire sales and marketing
personnel, and will require additional capital. We cannot make any assurances that qualified personnel will be available in adequate
numbers or at a reasonable cost, that additional financing will be available on acceptable terms, or at all, or that our sales
staff will achieve success in their marketing efforts.  Exchange
rate fluctuations will continue to affect our reported results of operations  The
functional currency of each of our Group's entities is measured using the currency of the primary economic environment in which
that entity operates. For our operations in Hong Kong and China, the functional currency for the companies operating in these
territories will have a functional currency of Hong Kong dollars and Chinese Renminbi, respectively. Substantially all of our
revenues are realized, and a significant portion of our operating costs are incurred, in Hong Kong dollars and Chinese Renminbi.
Movement in currency exchange rates will affect cash denominated in U.S. dollars and Australian dollars and therefore will affect
our reported results of operations.   6     We
have limited manufacturing experience with our production candidates. Delays in manufacturing sufficient quantities of products
may negatively impact our business and operations  We
have limited manufacturing experience. Our main focus is on pre-mass production manufacturing whilst we subcontract the mass production
manufacturing to qualified manufacturers. Should we obtain test orders, we may not be able to manufacture sufficient quantities
in a cost-effective or timely manner which would hinder the commercialization of the product, and reduce or prevent potential
revenues. We may need to develop additional manufacturing resources, enter into collaborative arrangements with other parties,
or have third parties manufacture our products on a contract basis. We may not have access, on acceptable terms, to the substantial
financing that would be required to scale-up production and develop commercial manufacturing processes. We may not be able to
enter into collaborative or contractual arrangements on acceptable terms with third parties that will meet our requirements for
quality, quantity and timeliness. Such delays and hurdles could harm our business, financial condition and results of operations. To
the extent we rely significantly on contractors, we will be exposed to risks related to the business conditions of our contractors We
are a small company, with few test manufacturing staff and small assembly facilities. We rely on a variety of contractors to manufacture
our products. Adverse events that affect one or more of our contractors could adversely affect us, such as:  •
    a contractor
    is unable to retain key staff that have been working on our manufacturing orders;•
    a contractor produces
    substandard products that are unacceptable to clients;•
    a contractor is
    unable to sustain operations due to financial or other business issues;•
    a contractor loses
    its business permits or licenses that may be required to manufacture our products; or•
    errors, negligence
    or misconduct that occur within a contractor may adversely affect our business concerns although we may not be directly responsible.   To
the extent we are able to enter into collaborative arrangements or strategic alliances, we will be exposed to risks related to
those collaborations and alliances An
important element of our strategy for developing, manufacturing and commercializing our 3D products is entering into partnerships
and strategic alliances with other electronics and distribution companies or other industry participants to advance our development
and distribution capabilities and enable us to maintain our financial and operational capacity. We may not be able to negotiate
alliances on acceptable terms, if at all. Although we are not currently party to any collaborative arrangement or strategic alliance
that we believe is material to our business, in the future we may rely on collaborative arrangements or strategic alliances to
complete the development and commercialization of some of our 3D products. Although we have no specific reason to believe that
we will be at a disadvantage when negotiating such collaborative arrangements or strategic alliances, our negotiating position
will be influenced by our financial capacity at the relevant time to continue the development and commercialization of the relevant
3D products, as well as the timing of any such negotiations and the stage of development of the relevant product candidate. These
arrangements may result in us receiving less revenue than if we sold such products directly, may place the development, sales
and marketing of our products outside our control, may require us to relinquish important rights or may otherwise be on terms
unfavorable to us. Collaborative arrangements or strategic alliances will subject us to a number of risks, including the risk
that:  •
    we may
    not be able to control the amount and timing of resources that our strategic partners/collaborators may devote to the 3D products;•
    our strategic partners/collaborators
    may experience financial difficulties;•
    we may be required
    to relinquish important rights such as marketing and distribution rights;•
    business combinations
    or significant changes in a collaborator's business strategy may also adversely affect a collaborator's willingness
    or ability to complete its obligations under any arrangement;•
    a collaborator could
    independently move forward with a competing product developed either independently or in collaboration with others, including
    our competitors; and•
    collaborative arrangements
    are often terminated or allowed to expire, which would delay the development and may increase the cost of developing our product
    candidates.   7     We
may face intellectual property infringement claims and other related claims that could be time-consuming and costly to defend
and may result in our inability to continue providing certain of our existing services  Technology
and service companies are frequently involved in litigation based on allegations of infringement of intellectual property rights,
unfair competition, and invasion of privacy, defamation and other violations of third-party rights. The validity, enforceability
and scope of protection of intellectual property, particularly in China, are uncertain and still evolving. In addition, many parties
are actively developing and seeking protection for electronics technologies, including seeking patent protection. There may be
patents issued or pending that are held by others that cover significant aspects of our technologies, products, business methods
or services. As we face increasing competition and as litigation becomes more common in China and Hong Kong and elsewhere in Asia
for resolving commercial disputes, we face a higher risk of being the subject of intellectual property infringement claims.  Intellectual
property litigation is expensive and time consuming and could divert resources and management attention from the operations of
our businesses. If there is a successful claim of infringement, we may be required to pay substantial fines and damages or enter
into royalty or license agreements that may not be available on commercially acceptable terms, if at all. Our failure to obtain
a license of the rights on a timely basis could harm our business. Any intellectual property litigation could have a material
adverse effect on our business, financial condition or results of operations.  If
we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report
our financial results or prevent fraud  We
are subject to reporting obligations under the U.S. securities laws. The SEC, as required by Section 404 of the Sarbanes-Oxley
Act of 2002, adopted rules requiring every public company to include in its annual report a management report on such company's
internal controls over financial reporting which contains management's assessment of the effectiveness of the company's internal
controls over financial reporting. In addition, if the Company qualifies under certain revenue or market capitalization test an
independent registered public accounting firm must attest to and report on management's assessment of the effectiveness of the
company's internal controls over financial reporting. In addition, an independent registered public accounting firm must attest
to and report on management's assessment of the effectiveness of the company's internal controls over financial reporting.
These requirements may first apply to our annual report on Form 20-F for the fiscal year ending December 31, 2018. Our management
may conclude that our internal controls over financial reporting are not effective. Moreover, even if our management concludes
that our internal controls over financial reporting are effective, our independent registered public accounting firm may still
decline to attest to our management's assessment or may issue a report that is qualified if they are not satisfied with our controls
or the level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements
differently from us. Our reporting obligations as a public company will place a significant strain on our management, operational
and financial resources and systems for the foreseeable future. We are a company with a small team of accounting personnel and
other resources with which to address our internal financial controls and procedures. If we fail to timely achieve and maintain
the adequacy of our internal financial controls, we may not be able to conclude that we have effective internal controls over
financial reporting at a reasonable assurance level. Moreover, effective internal controls over financial reporting are necessary
for us to produce reliable financial reports and are important to help prevent fraud. As a result, our failure to achieve and
maintain effective internal controls over financial reporting could result in the loss of investor confidence in the reliability
of our financial statements, which in turn could harm our business and negatively impact the market price of our shares.  If
we fail to attract customers for our 3D products or services, our growth prospects could be seriously harmed  Our
distributors will not work with us if our products and services offerings do not sell well or do not have adequate sales margin
for their sales channels. In addition, our customers will not maintain their business relationships with us if we cannot secure
attractive competitive product and service offerings. Failure to retain customers, distributors or channel partners could seriously
harm our business and growth prospects.    8     Because
we primarily rely on distributors in distributing 3D display technology and system, our failure to retain key distributors or
attract additional distributors could materially and adversely affect our business  For
our 3D business, we mainly rely on distributors to sell our products and services. If our distributors do not provide quality
services to its customers, they may lose customers and our results of operations may be materially and adversely affected indirectly.
We will sign distributing agreements with our distributors, although we may not sign any long-term agreements with them, but we
cannot assure that we can maintain favorable relationships with them. Our distribution arrangements will be non-exclusive. Furthermore,
some of our potential distributors may have contracts with our competitors or potential competitors and may not sign distribution
agreements with us. If we fail to retain our key distributors or attract additional distributors on terms that are commercially
reasonable, our business and results of operations could be materially and adversely affected.  The
recent global economic and financial market crisis has had and may continue to have a negative effect on our business and results
of operations  Global
economic conditions could have a negative effect on our business and results of operations like the global economic and stock
market downturn in early 2018 when economic activity in China and throughout much of the world has also undergone an economic
downturn. As a result the global credit and liquidity have tightened in much of the world. Some of our potential customers in
China and Hong Kong may face business downturn and credit issues, and could experience cash flow problems and other financial
hardships, which could affect timeliness of doing business with us.  Changes
in governmental banking, monetary and fiscal policies to restore liquidity and increase credit availability may not be effective
in alleviating the global economic declines. It is difficult to determine the breadth and duration of the economic and financial
market problems and the many ways in which they may affect our customers and our business in general. Nonetheless, continuation
or further worsening of these difficult financial and macroeconomic conditions could have a significant effect on our business
and results of operations.  Capital
markets are currently experiencing a period of dislocation and instability, which has had and could continue to have a negative
impact on the availability and cost of capital  The
general disruption in the U.S. and Australia capital markets has impacted the broader financial and credit markets and reduced
the availability of debt and equity capital for the market as a whole. These conditions could persist for a prolonged period of
time or worsen in the future. Our ability to access the capital markets may be restricted at a time when we would like, or need,
to access such markets, which could have an impact on our flexibility to react to changing economic and business conditions. The
resulting lack of available credit, lack of confidence in the financial sector, increased volatility in the financial markets
and reduced business activity could materially and adversely affect our business, financial condition, results of operations and
our ability to obtain and manage our liquidity. In addition, the cost of debt financing may be materially adversely impacted by
these market conditions.  The
success of our business depends on the continuing contributions of Dr. Herbert Ying Chiu Lee and other key personnel who may terminate
their employment with us at any time, and we will need to hire additional qualified personnel  We
rely heavily on the services of Dr. Herbert Ying Chiu Lee, our director and Chief Executive Officer, as well as a few other management
personnel. Loss of the services of any such individuals would adversely impact our operations. In addition, we believe our technical
personnel represent a significant asset and provide us with a competitive advantage over many of our competitors and that our
future success will depend upon our ability to retain these key employees and our ability to attract and retain other skilled
financial, engineering, technical and managerial personnel. We do not currently maintain any "key man" life insurance
with respect to any of such individuals.   9     Our
success depends on the continuing efforts of our senior management team and other key personnel and our business may be harmed
if we lose their services  Our
future success depends heavily upon the continuing services of the members of our senior management. If one or more of our senior
executives or other key personnel are unable or unwilling to continue in their present positions, we may not be able to replace
them easily or at all, and our business may be disrupted and our financial condition and results of operations may be materially
and adversely affected. Competition for senior management and key personnel is intense, the pool of qualified candidates is very
limited, and we may not be able to retain the services of our senior executives or key personnel, or attract and retain high-quality
senior executives or key personnel in the future.  In
addition, if any member of our senior management team or any of our other key personnel joins a competitor or forms a competing
company, we may lose customers, distributors, know-how and key professionals and staff members. Each of our executive officers
and key employees has entered into an employment agreement with us which contains confidentiality and non-competition provisions.
Legal proceedings to enforce such provisions would be costly in both money and management time and such provisions may not be
enforced or enforceable.  Our
research and development efforts will be jeopardized if we are unable to retain key personnel and cultivate key academic and technology
collaborations  Our
future success depends to a large extent on the continued services of our senior management and key technology personnel. We are
currently in the process of obtaining key man insurance for key management personnel. We are not aware that any member of our
senior management personnel is contemplating ending their relationship with IMT. Competition among technology companies for qualified
employees is intense and we may not be able to attract and retain personnel critical to our success. Our success depends on our
continued ability to attract, retain and motivate highly qualified management, technology personnel, manufacturing personnel,
sales and marketing personnel and on our ability to develop and maintain important relationships with researchers, scientists
and leading academic institutions. If we fail to identify, attract, retain and motivate these highly skilled personnel, we may
be unable to continue our development and commercialization activities.  We
rely on highly skilled personnel and if we are unable to retain or motivate key personnel or hire qualified personnel, we may
not be able to grow effectively  Our
performance and future success depends on the talents and efforts of highly skilled individuals. We will need to continue to identify,
hire, develop, motivate and retain highly skilled personnel for all areas of our organization. Competition in our industry for
qualified employees is intense. Our continued ability to compete effectively depends on our ability to attract new employees and
to retain and motivate our existing employees.  As
competition in our industry intensifies, it may be more difficult for us to hire, motivate and retain highly skilled personnel.
If we do not succeed in doing so, we may be unable to grow effectively.  We
    have no business insurance coverage  We
do not have any business liability or disruption insurance coverage for our operations in China and Hong Kong. Any business disruption,
litigation or natural disaster may result in our incurring substantial costs and the diversion of our resources.  We
are exposed to risks associated with the ongoing financial crisis and weakening global economy, which increase the uncertainty
of consumers purchasing products and/or services  The
recent severe tightening of the credit markets, turmoil in the financial markets, and weakening global economy are contributing
to a decrease in spending by consumers. If these economic conditions are prolonged or deteriorate further, the market
for our products and services will decrease accordingly.   10     Our
Company may experience, and continues to experience, rapid growth in operations, which may place, and may continue to place,
significant demands on its management, operational and financial infrastructure  If
the Company does not effectively manage its growth, the quality of its products and services could suffer, which could negatively
affect the Company's brand and operating results. To effectively manage this growth, the Company will need to continue to improve
its operational, financial and management controls and its reporting systems and procedures. Failure to implement these improvements
could hurt the Company's ability to manage its growth and financial position.  Our
Company's business faces inherent risk in the electronics and digital media industries for 3D products and services  Our
    Group's business is subject to certain risks inherent in the electronics and digital advertising industries for 3D products
    and services. Our Group's revenue and operating results could be adversely affect by many factors which include, amongst others,
    changes in general economic, business and credit conditions, fluctuation in foreign exchange rates, changes in demand for
    and market acceptance of our products and services, our ability to introduce new products and services and enhancements in
    a timely manner, rapid technological changes, increase in operating expenses, lower profit margins due to pricing competition
    and delay in expansion plans.  Our
    Group seeks to limit these business risks through, inter-alia prudent management policies, keeping abreast with new developments
    and technologies in the relevant industries and maintaining good relationship with customers and suppliers. However there
    can be no assurance that any changes in these factors will not have any material adverse effect on our Group's business.  Our
Company's business faces competition from local and foreign competitors  Our
Group faces competition from both local and foreign competitors which offer similar products that of our Group offerings. Increased
competition could result in competitive pricing resulting in lower profit margins. However, our Group believes that we have competitive
edge over our competitors; including amongst others, better quality products, access to R&D capabilities and technological
expertise acquired over the years.  Our
Group seeks to limit the competitive risks through, inter-alia constant review of our development and marketing strategies to
adapt to changes in economic conditions and market demands as well as focusing on certain markets and industries. However, there
can be no assurance that our Group will be able to compete effectively against our competitors and that competitive pressure will
not materially and adversely affect our Group's business, operations and results and or financial condition.   11     Risks
Relating to Our Organization  Public
company compliance may make it more difficult for us to attract and retain officers and directors  The
Sarbanes-Oxley Act and new rules subsequently implemented by the SEC have required changes in corporate governance practices of
public companies. As a public company, we expect these new rules and regulations to increase our compliance costs to an estimate
of about A$250,000 and to make certain activities more time consuming and costly. As a public company, we also expect that these
new rules and regulations may make it more difficult and expensive for us to obtain director and officer liability insurance in
the future and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the
same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our
board of directors or as executive officers. If
we infringe the intellectual property rights of third parties, it may increase our costs or prevent us from the commercialization
our product candidates. There
is a risk that we are or may infringe the proprietary rights of third parties of which we are unaware. There has been substantial
litigation and other proceedings regarding patent and other intellectual property rights in the electronics industries. To date,
we have not been involved in any such third-party claims and we are not aware that our 3D and audio products infringe the intellectual
property rights of third parties. As a result of intellectual property infringement claims, or to avoid potential claims, we might
be:  •
    prohibited
    from selling or licensing any products that we may develop unless the patent holder licenses the patent to us, which it is
    not required to do;  •
    required
    to expend considerable amounts of money in defending the claim;  •
    required
    to pay substantial royalties or grant a cross license to our patents to another patent holder;  •
    required
    to redesign the formulation of a product so that it does not infringe, which may not be possible or could require substantial
    funds and time; or  •
    required
    to pay substantial monetary damages. Future
sales of our products may suffer if they are not accepted in the marketplace by consumers and customers. There
is a risk that our 3D products may not gain market acceptance by consumers and customers. The degree of market acceptance of any
of our 3D and audio products will depend on a variety of factors, including:  •
    timing
    of market introduction; and  •
    price
    and product feature compared to existing and new products.  We
may be exposed to product liability claims which could harm our business.  The
marketing and sale of consumer and electronic products entails an inherent risk of product liability. We face product liability
exposure related to our products. Regardless of merit or eventual outcome, liability claims may result in:  •
    decreased
    demand for our products;  •
    injury
    to our reputation;  •
    costs
    of related litigation;  •
    substantial
    monetary awards to customers and others;  •
    loss
    of revenues; and  •
    the
    inability to commercialize our other products.  If
there is a claim made against us or some other problems that is attributable to our products, our share price may be negatively
affected. Even if we were ultimately successful in product liability litigation, the litigation would consume substantial amounts
of our financial and managerial resources and may create adverse publicity, all of which would impair our ability to generate
sales of our product candidates. We may incur substantial liabilities or be required to limit development or commercialization
of our product candidates if we cannot successfully defend ourselves against product liability claims. Such coverage may not be
available in the future on acceptable terms, or at all. Even if we have adequate insurance coverage, product liability claims
or recalls could result in negative publicity and force us to devote significant managerial and financial resources to those matters,
and the commercialization of our other products may be delayed or severely compromised.   12     Changes
in government legislation and policy may adversely affect us  While
we do not anticipate in the near future any specific material changes in government legislation that may adversely affect us,
any material changes in interest rate, exchange rate, relevant taxation and other legal regimes and government policies may adversely
affect our operations, the use of our financial resources and the market price of our ordinary shares.  Currency
fluctuations may expose us to increased costs and revenue decreases Our
business may in the future be affected by fluctuations in foreign exchange rates. Currency fluctuations could, therefore, cause
our costs to increase and revenues to decline. The majority of our expenses will continue to be denominated in Hong Kong dollars
and Renminbi. In the past two years, the Australian dollars, our reporting currency, has as a general trend, depreciated against
the U.S. currency. We cannot anticipate whether this trend will continue in respect of the U.S. dollars. The exchange rates of
the Australian dollar to the Hong Kong and the Chinese Renminbi have also fluctuated over the same period. In circumstances where
the Australian dollar depreciates against either or both of the U.S. dollar, Hong Kong dollar or Chinese Renminbi, this may have
an adverse effect on our costs incurred in either the U.S. or Hong Kong or China (as applicable) but may have a positive effect
on any revenues which we source from the U.S. or Hong Kong or China (as applicable). The same principles apply in respect of our
costs and revenues in other jurisdictions. In addition, we conduct operations in Hong Kong and China, which exposes us to potential
cost increases resulting from fluctuations in exchange rates. To date, we have been affected negatively on material foreign exchange
losses as a result of currency fluctuations. Australian
takeovers laws may discourage takeover offers being made for us or may discourage the acquisition of large numbers of our shares We
are incorporated in Australia and are subject to the takeovers laws of Australia. Amongst other things, we are subject to the
Corporations Act 2001 (Commonwealth of Australia). Subject to a range of exceptions, the Corporations Act prohibits the acquisition
of a direct or indirect interest in our issued voting shares if the acquisition of that interest will lead to a person's
or someone else's voting power in us increasing from 20% or below to more than 20%, or increasing from a starting point
that is above 20% and below 90%. Exceptions to the general prohibition include circumstances where the person makes a formal takeover
bid for us, if the person obtains shareholder approval for the acquisition or if the person acquires less than 3% of the voting
power of us in any rolling six month period. Australian takeovers laws may discourage takeover offers being made for us or may
discourage the acquisition of large numbers of our shares. Rights
as a holder of ordinary shares are governed by Australian law and our Constitution and differ from the rights of shareholders
under U.S. law. Holders of our ordinary shares may have difficulty in effecting service of process in the United States or enforcing
judgments obtained in the United States We
are a public company incorporated under the laws of Australia. Therefore, the rights of holders of our ordinary shares are governed
by Australian law and our Constitution. These rights differ from the typical rights of shareholders in U.S. corporations. Circumstances
that under U.S. law may entitle a shareholder in a U.S. company to claim damages may also give rise to a cause of action under
Australian law entitling a shareholder in an Australian company to claim damages. However, this will not always be the case. Holders
of our ordinary shares may have difficulties enforcing, in actions brought in courts in jurisdictions located outside the U.S.,
liabilities under U.S. securities laws. In particular, if such a holder sought to bring proceedings in Australia based on U.S.
securities laws, the Australian court might consider:  •
    that
    it did not have jurisdiction; and/or  •
    that
    it was not an appropriate forum for such proceedings; and/or  •
    that,
    applying Australian conflict of laws rule, U.S. law (including U.S. securities laws) did not apply to the relationship between
    holders of our ordinary shares and us or our directors and officers; and/or  •
    that
    the U.S. securities laws were of a public or penal nature and should not be enforced by the Australian court.  Holders
of our ordinary shares may also have difficulties enforcing in courts outside the U.S. judgments obtained in the U.S. courts against
any of our directors and executive officers or us, including actions under the civil liability provisions of the U.S. securities
laws.   13     Our
operations may be materially and adversely affected by changes in the economic, political and social conditions of the PRC  Substantially
all of our non-cash assets are located in, and substantially all of our revenue is sourced from, the PRC. Accordingly, our business,
financial condition, results of operations and prospects may be influenced to a significant degree by political, economic and
social conditions in the PRC generally and by continued economic growth in the PRC as a whole.  The
PRC economy differs from the economies of most developed countries in many respects, including the extent of government involvement,
level of development, growth rate, control of foreign exchange and allocation of resources. While the PRC economy has experienced
significant growth over the past three decades, growth has been uneven across different regions and among various economic sectors.
The PRC government has implemented various measures to encourage economic development and guide the allocation of resources. Some
of these measures benefit the overall PRC economy, but may also have a negative effect on us. For example, our operating results
and financial condition may be adversely affected by government control over capital investments or changes in tax regulations
that are applicable to us. We cannot predict the possible impact of any future economic policies of the PRC government on our
business and operations.  The
PRC is facing a continued slowdown in economic growth. China's annual gross domestic product growth rate 2017 was 6.9% compared
to 6.7% in 2016 and 6.9% in 2015. This slowdown could cause a slowdown or decline in investment in digital advertising display
networks, which, in turn, may result in a reduction of demand for our products and services and thus materially reduce our revenues
and profitability.  Uncertainties
in the interpretation and enforcement of PRC laws, rules and regulations could limit the legal protections available to you and
us.  The
PRC legal system is a civil law system based on written statutes. Unlike common law systems, it is a system in which legal decisions
have limited value as precedents. In 1979, the PRC government began to promulgate a comprehensive system of laws and regulations
governing economic matters in general. The overall effect of legislation over the past three decades has significantly increased
the protections afforded to various forms of foreign or private-sector investment in the PRC. Our operations in the PRC are foreign-invested
enterprise and is subject to laws, rules and regulations applicable to foreign investment in the PRC as well as laws, rules and
regulations applicable to foreign-invested enterprises. These laws, rules and regulations change frequently, and their interpretation
and enforcement involve uncertainties. For example, we may have to resort to administrative and court proceedings to enforce the
legal protections that we enjoy either by law or contract. However, since PRC administrative and court authorities have significant
discretion in interpreting and implementing statutory and contractual terms, it may be more difficult to evaluate the outcome
of administrative and court proceedings and the level of legal protection we enjoy than in more developed legal systems. These
uncertainties may also impede our ability to enforce the contracts we have entered into, and materially impair our business and
operations.  We
may rely on dividends and other distributions on equity paid by our operating subsidiary to fund cash and financing requirements,
and limitations on the ability of our operating subsidiaries to pay dividends to us could materially restrict our ability to conduct
our business.  We,
as a holding company, may rely on dividends and other distributions on equity paid by our operating PRC subsidiaries for our cash
and financing requirements, including the funds necessary to pay dividends and other cash distributions to the parent company,
service any debt we may incur and pay our operating expenses. If these PRC subsidiaries incurs debt on their own behalf in the
future, the instruments governing the debt may restrict their ability to pay dividends or make other distributions to us. Furthermore,
relevant PRC laws, rules and regulations permit payments of dividends by our PRC subsidiaries only out of their retained earnings,
if any, determined in accordance with PRC accounting standards and regulations.  Restrictions
on currency exchange may limit our ability to effectively utilize our revenues as well as the ability of our PRC subsidiaries
to obtain debt or equity financing from financial institutions or investors outside the PRC, including us.  A
significant portion of our operating revenues have been denominated in Renminbi. The Renminbi is currently convertible under the
"current account," which includes dividends, trade and service-related foreign exchange transactions, but not under
the "capital account," which includes foreign direct investment and loans. Currently, each of our PRC subsidiaries may
purchase foreign exchange for settlement of "current account transactions," including purchase of imported components
i.e. display chips and payment of dividends to the overseas parent company, without the approval of the SAFE by complying with
certain procedural requirements. However, the relevant PRC government authorities may limit or eliminate our ability to purchase
foreign currencies in the future for current account transactions. Since a significant amount of our future revenues will likely
be denominated in Renminbi, any existing and future restrictions on currency exchange may limit our ability to utilize revenues
generated in Renminbi to purchase for example computer display chips from suppliers outside the PRC or fund our business activities
outside the PRC denominated in foreign currencies or pay dividends in foreign currencies to our overseas parent company.  In
addition, certain foreign exchange transactions under the capital account are still subject to limitations and require approvals
from, or registration with, the SAFE (or qualified banks designated by it) and other relevant PRC government authorities. In particular,
any loans to our PRC subsidiaries are subject to PRC regulations and approvals. For example, loans by us to Marvel Digital Shenzhen
Limited, a foreign-invested enterprise, cannot exceed statutory limits and must be registered with the SAFE or its local counterpart.  This
could affect the ability of Marvel Digital Shenzhen Limited to obtain foreign exchange through debt or equity financing, including
by means of loans or capital contributions from us.   14     Our independent registered public accounting firm's audit documentation related to its audit reports included in our annual
report may include audit documentation located in China. The Public Company Accounting Oversight Board currently cannot inspect
audit documentation located in China and, as such, you may be deprived of the benefits of such inspection.  Our
independent registered public accounting firm issued an audit opinion on the financial statements included in our annual report
filed with the SEC. As an auditor of companies that are traded publicly in the United States and a firm registered with the Public
Company Accounting Oversight Board, or the PCAOB, our auditor is required by the laws of the United States to undergo regular
inspections by the PCAOB. However, work papers located in China are not currently inspected by the PCAOB because the PCAOB is
currently unable to conduct inspections without the approval of the PRC authorities.  Inspections
of certain other firms that the PCAOB has conducted outside of China have identified deficiencies in those firms' audit
procedures and quality control procedures, which may be addressed as part of the inspection process to improve future audit quality.
However, the PCAOB is currently unable to inspect an auditor's audit work related to a company's operations in China
and where such documentation of the audit work is located in China. As a result, our investors may be deprived of the benefits
of the PCAOB's oversight of auditors that are located in China through such inspections.  The
inability of the PCAOB to conduct inspections of an auditor's work papers in China makes it more difficult to evaluate the
effectiveness of any of our auditor's audit procedures or quality control procedures that may be located in China as compared
with auditors outside of China that are subject to PCAOB inspections. Investors may consequently lose confidence in our reported
financial information and procedures and the quality of our financial statements.  PRC
government may alter its regulations and policies from time to time which may have direct or indirect impact to our Company operations.  Regulations
and policies may be altered or other new regulations and policies may be implemented by PRC government from time to time which
may have direct or indirect impact to our business operations. Some examples of such regulations and policies are:  1
    media
    broadcast regulations over the Internet;   2
    foreign
    media to be distributed in PRC;   3
    operating
    permit for mobile sales and distribution;   4
    copyrighted
    digital media regulations;   5
    educational
    and cultural materials to be sold, distributed, created or transacted in PRC by foreign investment entities;  6
    foreign
    investment entities to operate business in the educational and media industries.  These
are only some of the examples that may have more direct impact to our business. Change of government officials may also affect
changes in regulations and policies, especially within local government. These changes may have impact to the operating strategies
or financial performance of the Company.   15     Risks
Associated with Our Technology and Intellectual Property  Potential
technological changes in our field of business create considerable uncertainty  We
are engaged in the 3D technology field, which is characterized by extensive research efforts and rapid technological progress.
New developments in research are expected to continue at a rapid pace in both industry and academia. Research and discoveries
by others may render some or all of our products uncompetitive or obsolete.  Our
business strategy is based in part upon new technologies to the development of 3D products. Unforeseen problems may develop with
these technologies or applications and it is possible that commercially feasible products will not ultimately be developed by
us.  If
we are unable to keep pace with technological change or with the advances of our competitors our technology and products may become
non-competitive  The
3D display and electronics industries are subject to rapid and significant technological change. Our competitors in Hong Kong,
China and Australia and elsewhere are numerous and include, among others, major technology companies, large electronics companies,
universities and other research institutions. These competitors may develop technologies and products that are more effective
than any that we are developing, or which would render our technology and products obsolete or non-competitive. Many of these
competitors have greater financial and technical resources and manufacturing and marketing capabilities than we do. In addition,
many of our competitors have much more experience than we do in commercializing new technologies of new or improved display products.  We
know that competitors are developing or manufacturing various technologies or products for the 3D display products and services
that we have targeted for product development. Some of these competitive products use alternative approaches that compete directly
with some of our product candidates. Our ability to further develop our products may be adversely affected if any of our competitors
were to succeed in commercializing their products sooner than we do.  Our
success depends upon our ability to protect our intellectual property and our proprietary technology  Our
success will depend in large part on whether we can:  •
    Obtain
    and maintain patents to protect our own products;  •
    Obtain
    licenses to relevant patented technologies of third parties;   •
    Operate
    without infringing on the proprietary rights of third parties;   •
    Protect
    our trade secrets and know-how; and   •
    Retain
    our valuable scientific staff who are experts on the subject matter.  Patent
matters in industrial and consumer electronics are highly uncertain and involve complex legal and factual questions. Accordingly,
the availability and breadth of claims allowed in electronics patents cannot be predicted. Statutory differences in patentable
subject matter may limit the protection we can obtain on some or all of our inventions outside Hong Kong or China or prevent us
from obtaining patent protection outside Hong Kong or China, either of which could have a material adverse effect on our business,
financial condition and results of operations. Moreover, since patent applications in Hong Kong or China are maintained in secrecy
until the patent is issued, and since publication of discoveries in the scientific or patent literature often lags behind actual
discoveries, we cannot be certain that we or any of our licensors were the first creator of inventions covered by pending patent
applications or that we or our licensors were the first to file patent applications for such inventions. Additionally, the enforceability
of a patent depends on a number of factors that may vary amongst jurisdictions. These factors may include the novelty of the invention,
the requirement that the invention not be obvious in light of prior art (including prior use or publication of the invention),
the utility of the invention, and the extent to which the patent clearly describes the best method of working the invention.   16     Our
success depends upon our ability to protect our intellectual property and our proprietary technology (continued)  While
we intend to seek patent protection for some of our 3D products and technologies, we cannot be certain that any of the pending
or future patent applications filed by us or on our behalf will be approved, or that we will develop additional proprietary products
or processes that are patentable or that we will be able to license any other patentable products or processes. We also cannot
be certain that others will not independently develop similar products or processes, duplicate any of the products or processes
developed or being developed by us or licensed to us, or design around the patents owned or licensed by us, or that any patents
owned or licensed by us will provide us with competitive advantages. Furthermore, we cannot be certain that patents held by third
parties will not prevent the commercialization of products incorporating the technology developed by us or licensed to us, or
that third parties will not challenge or seek to narrow, invalidate or circumvent any of the issued, pending or future patents
owned or licensed by us.  We
may have to resort to litigation to enforce any patents issued or licensed to us or to determine the scope and validity of third
party proprietary rights. We may have to defend the validity of our patents in order to protect or enforce our rights against
a third party, or third parties may in the future assert against us infringement claims regarding proprietary rights belonging
to them. Such proceedings could result in the expenditure of significant financial and managerial resources and could negatively
affect our profitability. Adverse determinations in any such proceedings could prevent us from developing and commercializing
our products and could harm our business, financial condition and results of operations.  Our
commercial success will also depend, in part, on our ability to avoid infringement of patents issued to others. If a court determines
that we were infringing any third-party patents, we could be required to pay damages, alter our products or processes, obtain
licenses or cease certain activities. We cannot be certain that the licenses required under patents held by third parties would
be made available on terms acceptable to us or at all. To the extent that we are unable to obtain such licenses, we could be foreclosed
from the development, manufacture or commercialization of the product requiring such license or encounter delays in product introductions
while we attempt to design around such patents, and any of these circumstances could have a material adverse effect on our business,
financial condition and results of operations.  In
addition to patent protection, we rely on unpatented trade secrets and know-how and proprietary technological innovation and expertise
that are protected in part by confidentiality and invention assignment agreements with our employees, advisors and consultants.
We cannot make any assurances that we will have adequate remedies for any breach. In addition, third parties could independently
develop the same or similar technologies.  If
we are not able to protect and control unpatented trade secrets, know-how and other technological innovation, we may suffer competitive
harm  In
addition to patented intellectual property, we also rely on unpatented technology, trade secrets, confidential information and
know-how to protect our technology and maintain our competitive position. Trade secrets are difficult to protect. In order to
protect proprietary technology and processes, we rely in part on confidentiality and intellectual property assignment agreements
with our employees, consultants and others. These agreements may not effectively prevent disclosure of confidential information
or result in the effective assignment to us of intellectual property, and may not provide an adequate remedy in the event of unauthorized
disclosure of confidential information or other breaches of the agreements. In addition, others may independently discover trade
secrets and proprietary information that have been licensed to us or that we own, and in such case we could not assert any trade
secret rights against such party. Enforcing a claim that a party illegally obtained and is using trade secrets that have been
licensed to us or that we own is difficult, expensive and time-consuming, and the outcome is unpredictable. In addition, courts
outside the United States and Australia may be less willing to protect trade secrets. Costly and time-consuming litigation could
be necessary to seek to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret
protection could have a material adverse effect on our business.  We
do not have patent protection in certain countries and we may not be able to effectively enforce our intellectual property rights
in certain countries, which could significantly erode the market for our product candidates  We
intend to seek regulatory approval to market our product candidates in a number of foreign countries. Our product candidates are
not protected by patents in certain countries, which means that competitors may be free to sell products that incorporate the
same technology that is used in our products in those countries. In addition, the laws and practices in some foreign countries
may not protect intellectual property rights to the same extent as in the United States or Australia. We may not be able to effectively
obtain, maintain or enforce rights with respect to the intellectual property relating to our product candidates in those countries.
Our lack of patent protection in one or more countries, or the inability to obtain, maintain or enforce intellectual property
rights in one or more countries, could adversely affect our ability to commercialize our products in those countries and could
otherwise have a material adverse effect on our business.   17     Risks
Relating to Our Securities  Our
stock price may be volatile  The
market price of our Common Stock is likely to be highly volatile and could fluctuate widely in price in response to various factors,
many of which are beyond our control, including the following:  *
    changes in our industry;*
    competitive pricing pressures;*
    our ability to obtain working capital financing;*
    additions or departures of key personnel;*
    limited "public float" in the hands
    of a small number of persons whose sales or lack of sales could result in positive or negative pricing pressure on the market
    price for our Common Stock;*
    sales of our Common Stock;*
    our ability to execute our business plan;*
    operating results that fall below expectations;*
    loss of any strategic relationship;*
    regulatory developments;*
    Developments concerning research and development,
    manufacturing, and marketing alliances or collaborations by us and our competitors;*
    Announcements of technological innovations or
    new commercial products by us and our competitors;*
    regulatory actions in respect of any of our
    products or the products of any of our competitors;*
    determinations regarding our patent applications
    and those of others;*
    market conditions, including market conditions
    in the technology and digital media sectors;*
    increases in our costs or decreases in our revenues
    due to unfavorable movements in foreign currency exchange rates;*
    development or litigation concerning patents,
    licenses and other intellectual property rights;*
    litigation or public concern about the safety
    of our potential products;*
    changes in recommendations or earnings estimates
    by securities analysts;*
    deviations in our operating results from the
    estimates of securities analysts;*
    rumors relating to us or our competitors;*
    developments concerning current or future strategic
    alliances or acquisitions;*
    political, economic and other external factors
    such as interest rate or currency fluctuations; and*
    period-to-period fluctuations in our financial
    results.  In
addition, stock markets have recently experienced extreme price and volume fluctuations. These fluctuations have especially affected
the stock market price of many technology and digital media companies and, in many cases, are unrelated to the operating performance
of the particular companies. We believe that these broad market fluctuations may continue to affect the market price of our ordinary
shares. Our
ordinary shares may be considered a "penny stock" under SEC regulations which could adversely affect the willingness
of investors to hold our Shares The
SEC has adopted regulations which generally define "penny stock" to be an equity security that has a market price
of less than $5.00 per share, subject to specific exemptions. During the fiscal year ended December 31, 2017, our ordinary shares
traded on the ASX at an average of A$5.95 per share and on the Nasdaq of US$6.70 per share. Under ASX listing rules our shares
may not trade below A$0.001 per share. The low trading price of our ordinary shares rules may adversely the willingness of investors
to invest in our common shares in the United States.   18     We
may be deemed a passive foreign investment company (PFIC) which would subject our U.S. investors to adverse tax rules Holders
of our ordinary shares who are U.S. residents face income tax risks. There is a substantial risk that if we are deemed a passive
foreign investment company, or PFIC, which could result in a reduction in the after-tax return to a "U.S. Holder"
of our ordinary shares. For U.S. federal income tax purposes, we will be classified as a PFIC for any taxable year in which (i) 75%
or more of our gross income is passive income, or (ii) at least 50% of the average value of all of our assets for the taxable
year produce or are held for the production of passive income. For this purpose, cash is considered to be an asset that produces
passive income. The
determination of whether we are a PFIC is made on an annual basis and depends on the composition of our income and the value of
our assets. Therefore, it is possible that we could be deemed a PFIC in the current year as well as in future years. If we are
classified as a PFIC in any year that a U.S. Holder owns ordinary shares, the U.S. Holder will generally continue to be treated
as holding ordinary shares of a PFIC in all subsequent years, notwithstanding that we are not classified as a PFIC in a subsequent
year. Dividends received by the U.S. Holder and gains realized from the sale of our ordinary shares would be taxed as ordinary
income and subject to an interest charge. We urge U.S. investors to consult their own tax advisors about the application of the
PFIC rules and certain elections that may help to minimize adverse U.S. federal income tax consequences in their particular circumstances.  As
a foreign private issuer whose shares are listed on the NASDAQ Capital Market, we may follow certain home country corporate governance
practices in lieu of instead of certain NASDAQ requirements As
a foreign private issuer whose shares are listed on the NASDAQ Capital Market, we are permitted to follow certain home country
corporate governance practices instead of certain requirements of The NASDAQ Marketplace Rules. As an Australian company listed
on the NASDAQ Capital Market, we may follow home country practice with regard to, among other things, the composition of the board
of directors, director nomination process, compensation of officers and quorum at shareholders' meetings. In addition, we
may follow Australian law instead of the NASDAQ Marketplace Rules that require that we obtain shareholder approval for certain
dilutive events, such as for the establishment or amendment of certain equity based compensation plans, an issuance that will
result in a change of control of the company, certain transactions other than a public offering involving issuances of a 20% or
more interest in the company and certain acquisitions of the stock or assets of another company. A foreign private issuer that
elects to follow a home country practice instead of NASDAQ requirements, must submit to NASDAQ in advance a written statement
from an independent counsel in such issuer's home country certifying that the issuer's practices are not prohibited
by the home country's laws. In addition, a foreign private issuer must disclose in its annual reports filed with the U.S.
Securities and Exchange Commission each such requirement that it does not follow and describe the home country practice followed
by the issuer instead of any such requirement. Accordingly, our shareholders may not be afforded the same protection as provided
under NASDAQ's corporate governance rules. Please see "Item 6. Directors, Senior Management and Employees –
C. Board Practices" for further information.  U.S.
shareholders may not be able to enforce civil liabilities against us  All
of our directors and executive officers are non-residents of the United States, and all or a substantial portion of the assets
of such persons are located outside the United States. As a result, it may not be possible for investors to affect service of
process within the United States upon such persons or to enforce against them judgments obtained in U.S. courts predicated upon
the civil liability provisions of the federal securities laws of the United States. There is doubt as to the enforceability in
Australia in original actions, or in actions for enforcement of judgments of U.S. courts, of civil liabilities to the extent predicated
upon the federal securities laws of the United States.   19     As
a foreign private issuer we do not have to provide the same information as an issuer of securities based in the U.S  Given
that we are a foreign private issuer within the meaning of the rules under the Exchange Act, we are exempt from certain provisions
of that law that are applicable to U.S. public companies, including (i) the rules under the Exchange Act requiring the filing
with the U.S. Securities and Exchange Commission ("SEC") of quarterly reports on Form 10-Q or current reports on Form
8-K; (ii) the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a
registered security; and (iii) the sections of the Exchange Act requiring insiders to file public reports of their stock ownership
and trading activities and liability for insiders who profit from trades made in a short period of time. Thus, investors are not
afforded the same information which would be ordinarily available were they investing in a domestic board U.S. public corporation.  In
accordance with the requirements of the Australian Securities Exchange and the Corporations Act 2001, we disclose annual and semi-annual
results. Our results are presented in accordance with Australian Accounting Standards and International Financial Reporting Standards
(IFRS). Our annual results are audited, and our semi-annual results undergo a limited review by our independent auditors. We file
annual audited results presented in accordance with Australian Accounting Standards and IFRS as issued by International Accounting
Standards Board with the SEC on Form 20-F. Subject to certain exceptions, we are also required to immediately disclose to the
Australian Securities Exchange any information concerning us that a reasonable person would expect to have a material effect on
the price or value of our shares. This would include matters such as (i) any major new developments relating to our business which
are not public knowledge and may lead to a substantial movement in our share price; (ii) any changes in our board of directors;
(iii) any purchase or redemption by us of our own equity securities; (iv) interests of directors in our shares or debentures;
and (v) changes in our capital structure. We are required to provide our semi-annual results and other material information that
we disclose in Australia in the U.S. under the cover of Form 6-K. Nevertheless, this information is not the same much information
as would be made available to investors were they investing in a domestic U.S. public corporation.  Future
issuances and sales of our stock could dilute your ownership and cause our stock price to decline  We
intend to continue to finance our operations through the issuance of securities, if feasible, including by way of the public equity
markets, private financings and debt. If we raise additional capital through the issuance of equity or securities convertible
into equity, existing holders of our securities may experience dilution. Those securities may have rights, preferences or privileges
senior to those of the holders of our ordinary shares. Additional financing may not be available to us on favorable terms, and
financing available at less favorable terms may lead to more substantial dilution of existing shareholders.  If
we fail to comply with internal controls evaluations and attestation requirements our stock price could be adversely affected  We
are subject to United States securities laws, including the Sarbanes-Oxley Act of 2002 and the rules and regulations adopted by
the SEC pursuant to such Act. As a foreign private issuer, under Section 404 of the Sarbanes-Oxley Act and the related regulations,
we will be required to perform an evaluation of our internal control over financial reporting, including (1) management's
annual report on its assessment of the effectiveness of internal control over financial reporting; and (2) our independent registered
public accounting firm's annual audit of the effectiveness of internal control over financial reporting. In 2010, the enactment
of the Dodd Frank Bill resulted in an exemption from Section 404(b) of the Sarbanes-Oxley Act for fiscal 2010 onwards, meaning
that we did not have to comply with point (2) above. For further information, see "Item 15—Controls and Procedures—Management's
Annual Report on Internal Control over Financial Reporting."  The
requirements of Section 404(a) of the Sarbanes-Oxley Act are ongoing and also apply to future years. We expect that our internal
control over financial reporting will continue to evolve as our business develops. Although we are committed to continue to improve
our internal control processes and we will continue to diligently and vigorously review our internal control over financial reporting
in order to ensure compliance with the Section 404 requirements, any control system, regardless of how well designed, operated
and evaluated, can provide only reasonable, not absolute, assurance that its objectives will be met. Therefore, we cannot be certain
that in the future additional material weaknesses or significant deficiencies will not exist or otherwise be discovered. If our
efforts to remediate weaknesses identified are not successful or if other deficiencies occur, these weaknesses or deficiencies
could result in misstatements of our results of operations, restatements of our financial statements, a decline in our stock price,
or other material effects on our business, reputation, results of operations, financial conditions or liquidity.   20     Our
Constitution and other Australian laws and regulations applicable to us may adversely affect our ability to take actions that
could be deemed beneficial to our shareholders  As
an Australian company we are subject to different corporate requirements than a corporation organized under the laws of the United
States. Our constituent document, or Constitution, as well as the Corporations Act 2001 and the ASX Listing Rules set forth various
rights and obligations that are unique to us as an Australian company. These requirements may limit or otherwise adversely affect
our ability to take actions that could be beneficial to our shareholders. We
have never paid a dividend and we do not intend to pay dividends in the foreseeable future which means that holders of shares
may not receive any return on their investment from dividends To
date, we have not declared or paid any cash dividends on our ordinary shares and currently intend to retain any future earnings
for funding growth. We do not anticipate paying any dividends in the foreseeable future. Dividends may only be paid out of our
profits. Payment of cash dividends, if any, in the future will be at the discretion of our board of directors. Our holders of
shares may not receive any return on their investment from dividends. The success of your investment will likely depend entirely
upon any future appreciation of the market price of our ordinary shares, which is uncertain and unpredictable. There is no guarantee
that our ordinary shares will appreciate in value or even maintain the price at which you purchased your ordinary shares. Currency
fluctuations may adversely affect the price of the ordinary shares traded on ASX and NASDAQ Our
ordinary shares will be quoted on the ASX and NASDAQ in Australian dollar and U.S. dollar, respectively. Movements in the Australian
dollar/U.S. dollar exchange rate may adversely affect the U.S. dollar price of our ordinary shares and the U.S. dollar equivalent
of the price of our ordinary shares. In the last two years, the Australian dollar has as a general trend depreciated against the
U.S. dollar. Any continuation of this trend may negatively affect the U.S. dollar price of our ordinary shares and the U.S. dollar
equivalent of the price of our ordinary shares, even if the price of our ordinary shares in Australian dollars increases or remains
unchanged. However, this trend may not continue and may be reversed. If the Australian dollar strengthens against the U.S. dollar,
the U.S. dollar price of the ordinary shares traded on NASDAQ could appreciate, even if the price of our ordinary shares in Australian
dollars decrease or remains unchanged. As
a result of becoming a SEC registrant, we will be obligated to develop and maintain proper and effective internal controls over
financial reporting. We may not complete our analysis of our internal controls over financial reporting in a timely manner, or
these internal controls may not be determined to be effective, which may adversely affect investor confidence in our company and,
as a result, the value of our common shares We
will be required, pursuant to Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things,
the effectiveness of our internal control over financial reporting for the first fiscal year beginning after the effective date
of this Form 20-F. This assessment will need to include disclosure of any material weaknesses identified by our management in
our internal control over financial reporting, as well as, if we are an accelerated filer or a large accelerated filer as stipulated
in Item 308(b) of Regulations S-K, a statement that our auditors have issued an attestation report on our management's
assessment of our internal controls. We
have not begun the costly and challenging process of compiling the system and processing documentation necessary to perform the
evaluation needed to comply with Section 404. We may not be able to complete our evaluation, testing and any required remediation
in a timely fashion. During the evaluation and testing process, if we identify one or more material weaknesses in our internal
control over financial reporting, we will be unable to assert that our internal controls are effective. If
we are unable to assert that our internal control over financial reporting is effective, or if our independent registered public
accounting firm is unable to express an opinion on the effectiveness of our internal controls, we could lose investor confidence
in the accuracy and completeness of our financial reports, which would cause the price of our common shares to decline.   We
may not be able to attract the attention of major brokerage firms  Securities
analysts of major brokerage firms may not provide coverage of us since there is no incentive to brokerage firms to recommend the
purchase of our Common Stock. No assurance can be given that brokerage firms will, in the future, want to conduct any secondary
offerings on behalf of our Company.    21     ITEM 4.
    
    INFORMATION
    ON THE COMPANY  A.
    
    History
    and Development of the Company We
were incorporated under the laws of the Commonwealth of Australia on August 8, 2008 under the name "China Integrated Media
Corporation Limited." On October 12, 2016, we changed the name to Integrated Media Technology Limited ("IMT").
The registered office is located at Level 7, 420 King William Street, Adelaide, SA 5000, Australia and our telephone number is
+61 8 7324 6018 and our fax number is +61 8 8312 0248. Our principal office is located at 7/F., Siu On Center, 188 Lockhart Road,
Wanchai, Hong Kong and our telephone number is +852 2989 0220 and our fax number is +852 2565 1303. Our address on the Internet
is www.imtechltd.com. The information on, or accessible through, our website is not part of this annual report on Form
20-F. We have included our website address in this annual report on Form 20-F solely as an inactive textual reference. In
2013, IMT was engaged in (i) the development of the digital advertising platform in glasses-free 3D (autostereoscopic), (ii) distribution
of digital displays and (iii) lottery gaming business in China. In 2015, the Company changed its focus of its businesses to concentrate
on 3D autostereoscopic business and took the following corporate actions: (i) terminated the lottery gaming business in China
and (ii) through a series of acquisitions for 3D technology and audio companies as described below. Today, the Company focuses
on the business activities in (i) the development, sale and distribution of autostereoscopic 3D display, 3D conversion equipment
and software, development and sale of 3D autostereoscopic technology and provision of 3D consultancy services, and (ii) sale and
distribution of audio products. IMT
was listed on the Australian Securities Exchange, or ASX, in February 2013 and raised $3,480,000 through the issuance of 17,400,000 new
Common Shares. The subscription proceeds were used as follows: (i) applied to the development of the digital advertising platform
in glasses free 3D (autostereoscopic) and the distribution of digital display, and (ii) working capital. On
February 9, 2015, the Company acquired all of the issued shares of Conco International Co., Ltd. ("CICL"), a company
principally engaged in the design, sales and distribution of audio products. The consideration paid was $61,591 which was the
amount of the net asset value of CICL. The consideration was settled by the Company issuing 307,954 shares at $0.20 per share.
In addition, the Company will pay performance shares to be issued to the vendor contingent on CICL achieving an agreed level of
profit performance. In
May 2015, the Company entered into a cooperation agreement to set up Global Vantage Audio Limited, a 50% subsidiary company, to
distribute and market branded "Syllable" headsets globally except for the markets in China, India and Pakistan. On
September 30, 2015, the Company acquired all of the issued shares of Marvel Digital Limited ("MDL"), a technology
company principally engaged in the development of autostereoscopic 3D display technology and products, 2D to 3D conversion software
and digital content management system. MDL was incorporated in Hong Kong and it holds two wholly-owned subsidiary companies namely
Visumotion International Limited and Marvel Digital (Shenzhen) Limited. The consideration paid was $5,216,213 which was the net
asset value of MDL. The consideration was settled by the Company issuing 26,081,065 shares at $0.20 per share. In addition, the
Company will pay a deferred performance fee calculated at five times of the average annualized consolidated profits of MDL for
the two years' period from the completion date less the initial purchase consideration. As
a result of the above acquisition of MDL, Marvel Finance Limited, a company wholly owned and controlled by our Chairman, Dr. Herbert
Ying Chiu Lee, became the controlling shareholder of IMT holding 44,787,331 shares representing approximately 56.48% of the outstanding
shares of IMT. In
December 2015, the Company terminated the agreement for the gaming and lottery business in China. In
February 2016, Digital Media Technology Limited, a 100% owned subsidiary of IMT, was incorporated in the Labuan, Malaysia. This
subsidiary will be the sales and distribution of products and technology licenses outside of Hong Kong and China.  In
March 2016, the Company disposed Conco International Co., Limited to an independent third party for US$41,235, representing the
net asset value of CICL.  In
April 2016, the Company purchased two Nevada companies namely Yamaga Audio Limited and Zamora Corporation. The Group intends to
use Yamaga Audio Limited as an investment holding company and to use Zamora Corporation as a sales and administration company
for future expansion to the United States. These companies were dormant companies and were purchased at $1.00 each.  On
October 12, 2016, pursuant to an extraordinary general meeting the Shareholders unanimously voted to change the name of the Company
to Integrated Media Technology Limited which was registered with Australian Securities and Investments Commission, and became
effective on the same date.   22     On
May 2, 2017, we effected a 1-for-30 reverse split of our common stock, which was approved at a special meeting of our shareholders
on March 2, 2017. The purpose of the reverse stock split was to enable us to meet the Nasdaq's minimum share price requirement.
The reverse stock split became effective and the common stock began trading on a split-adjusted basis on the Australian Securities
Exchange at the opening of trading on May 8, 2017. When the reverse stock split became effective, every thirty shares of our issued
and outstanding common stock was automatically combined into one issued and outstanding share of common stock. This reduced the
number of outstanding shares of our common stock from 79,301,852 shares on May 5, 2017, to 2,643,611 shares on May 8, 2017, after
adjusting for fractional shares.  In
July 2017, Marvel Digital Limited set up a new wholly-owned subsidiary - GOXD Technology Limited, incorporated in Hong Kong, for
carrying out business activities on sales and distribution of 2D/3D glasses-free 4K digital photo frames to corporate customers
and household consumers. In addition, a cloud platform with smart 2D to 3D photo conversion services, professional photographer
contributed photo eShop, operating mobile APP and user upload photo storage have also been developed to form a complete digital
photo frame ecosystem.  On
August 3, 2017 our shares of Common Stock were admitted for listing on the Nasdaq Capital Markets under the symbol "IMTL".  On
November 23, 2017, our major shareholder, Marvel Finance Limited, informed the Company that it had entered into a conditional
share swap agreement with Vantage Ultimate Limited, a wholly owned subsidiary of Sharing Economy International Inc. (Nasdaq: SEII)
being 1,348,241 fully paid ordinary shares at a price of US$10.00 per IMT share (valuing the parcel of shares at US$13,482,410).
In consideration for the transfer, Vantage Ultimate Limited shall arrange for SEII to issue and allocate a certain number of its
ordinary voting shares, representing 19.5% of the then issued share capital of SEII, and a 5 year interest free promissory note
with a principal amount of US$11,482,410 to MFL. The agreement is subject to various conditions, including entry into a definitive
agreement satisfactory to the parties and legal and financial due diligence on or before February 28, 2018. On March 1, 2018,
MFL has indicated as the timeline has end on February 2018, the conditional share swap agreement has lapsed pursuant to its terms
therein.  On
January 12, 2018, the Group entered into the following agreements in connection with the issue of a HK$23 million (equivalent
to approximately AU$3.8 million) Convertible Bonds (the "Convertible Bonds"): (i) Subscription Agreement between Marvel
Digital Limited, a wholly-owned subsidiary of the Company (the "Issuer" or "MDL") and an independent third
party entity ("Bondholder") for the Convertible Bonds, (ii) Deed of Guarantee between the Company and the Bondholder
to guarantee the payment obligations under the Convertible Bonds and (iii) Put Option Deed between the Company and the Bondholder
to repurchase any converted MDL Shares as described below. On the same date, pursuant to the Subscription Agreement, the Convertible
Bonds were issued by MDL to the Bondholder as all the terms and conditions in respect of the Subscription of the Convertible Bonds
were complied with and fulfilled.  Pursuant
to the terms of the Convertible Bonds, the Convertible Bonds are convertible in the circumstances set out therein into 75,000
ordinary shares of MDL ("MDL Shares") at a conversion price of HK$306.67 per share, which is equivalent to 20% of
the then enlarged issued share capital of MDL. The Bondholder will have the right to convert the whole of their Convertible Bonds
into ordinary shares of MDL at any time during the period from January 3, 2018 to January 2, 2020. The period may be extended
to a further 12 months subject to the mutual agreement among MDL, Company and Bondholder. Unless previously redeemed or converted,
the Convertible Bonds will be redeemed at 100% of their principal amount on the Maturity Date.  In
summary, the Group's business activities are (i) the development, sale and distribution of autostereoscopic 3D display,
3D video wall, 3D conversion equipment and software, sale of developed technology and provision of 3D consultancy services, and
(ii) sale and distribution of audio products.  Breakdown
of total revenues by category for the years ended December 31, 2017, 2016 and 2015:  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Development,
    sales and distribution of 3D autostereoscopic products and conversion equipment
    
    4,365,364
    
    4,726,500
    
    4,705,743Sales
    of software and technology solutions
    
    1,180,491
    
    9,085,792
    
    -Sales
    and distribution of audio products
    
    54,251
    
    111,045
    
    1,563,987Provision
    of consultancy and other services
    
    162,605
    
    6,333
    
    109,306Interest
    income
    
    3,092
    
    2,027
    
    3895,765,803
    
    13,931,697
    
    6,379,425  Breakdown
of total revenues by geographic market for the years ended December 31, 2017, 2016 and 2015:  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Australia
    
    62
    
    154
    
    4,828Hong
    Kong
    
    3,235,912
    
    5,507,701
    
    1,185,271China
    
    2,529,829
    
    8,423,842
    
    5,189,3265,765,803
    
    13,931,697
    
    6,379,425   23     B.
    
    Business
    Overview Integrated
Media Technology Limited is a technology investment, product development and distribution company. Our businesses involves three
distinct business units (i) core technology development and acquisition, (ii) commercializing these technologies into products
or services and (iii) distribution and branding of these products and services. Today, IMT is a technology driven company that
focuses on technology innovation to drive the Company business. Under
the Technology Business Unit, we intend to own a stable of core technologies through acquisition, in-house development or in collaboration
with research institutes. We can also profit from disposing some of the mature technology to non-competing parties once we have
developed more advance technology that supersedes the mature ones. Our Products and Services Business Unit will commercialize
the technology by integrating or developing innovative products, solutions and services using the technology. This will be the
revenue drivers for the Group. The Brand / Distribution Business Unit is the final phase to set up the distribution network and
channels for our own branded products. These business units are all interwoven and interdependent on the development of the other
business units. For example, products development depends on the success of the technology, and distribution is dependent on the
products being developed. Therefore, the Group's resources allocation is skewed towards technology development today. Currently
our primary focus is in the 3D autostereoscopic (glasses free) technology domain. Our principal activities are (i) research and
development of 3D autostereoscopic (glasses free) technology, (ii) the development, sale and distribution of 3D autostereoscopic
display, 3D video wall, 3D conversion equipment and software, provision of 3D consultancy services, sale of 3D technology solutions,
and (iii) sale and distribution of audio products. Since
2013, we have been involved in the sale of 3D autostereoscopic displays to the advertising industry. Due to the growth in the
demand for 3D autostereoscopic displays across multiple industries i.e. advertising, retail including mobile handheld devices
like tablets and smartphones, and educational sectors to name a few, the Group intends to become a leader in 3D autostereoscopic
market by strategically owning and controlling the core technologies of (i) glasses-free 3D video encoding/decoding; (ii) conversion
hardware for glasses-free 3D which includes FPGA (field-programmable gate array) board & computer workstation; (iii) 2D to
3D and multi-view conversion software (Visumotion); and (iv) content distribution/management system (CMS). In 2015, we acquired
Marvel Digital Limited ("MDL"), a technology company that develops (i) a proprietary digital content management system
for the display of 2D/3D video and text to networked screens over the internet, (ii) 2D to 3D conversion software and workstation,
and (iii) autostereoscopic 3D display technology. These technologies acquired will help in our deployment of 3D advertising platform
and also allows the Group to use the core technologies to develop and customize solutions for our customers, and to enter new
and exciting markets for 3D products and services. To
strengthen the Group's product offering, in February 2015 we started the audio division by first acquiring 100% interest
in Conco International Co., Ltd. ("CICL"), a company principally engaged in the design, sales and distribution of
audio products and then in May 2015, we entered into a cooperation agreement to set up a joint venture to distribute and market
branded "Syllable" headsets globally except for the markets in China, India and Pakistan. In March 2016, we streamlined
and consolidated the operation of speakers and headset business into one operation. Our immediate goal is to be recognized as
a leader in providing end-to-end solutions using the autostereoscopic display ("ASD") technology. Our products range
from commercial platforms to consumer electronics. Commercial platforms include digital signage and video wall with ASD functions
and associated advertising platform. Consumer electronics products include ASD enabled smartphone and tablet and TV. The applications
are endless for consumers to enjoy the exciting glasses-free 3D visual effect across multiple platforms. In
the longer term, we will continue to focus on developing certain core technologies and to strategically position ourselves to
be recognized as a leader in developing technology solutions and innovative products and services using our core technologies.  IMT
Products and Services IMT
has both the hardware and software technologies for products in everyday applications in the autostereoscopic display (ASD) technology
domain. We specialize in providing a range of products incorporating this ASD technology for a whole new visual experience. This
is a disruptive technology affecting how we will see contents in the future. IMT has also developed technology for content creation
and conversion through its "VisuMotion" software and 2D/3D conversion super-workstation hardware. In other words,
IMT has developed a whole ecosystem of technology in the ASD domain. The current products and services we offer are: Hardware:
ASD technology display, and Marvel3DPro Super-workstation; Software:
"Visumotion" content creation and conversion software; Content Management System and Services:
2D to 3D content conversion service and ASD solutions consulting services.   24     IMT
Hardware Products  ASD
Technology Display Products ASD
hardware products are mainly display terminals for presenting glasses-free 3D content which generally include ASD Video Wall,
ASD digital signage, ASD PC Monitors, ASD mobile phones and tablets. ASD
hardware products can be classified into fixed lenticular hardware and switchable lenticular hardware based on the capability
display panel. Switchable technology can display 2D image without affecting its perceived resolution, but the technology is still
immature and limited to small screen size. The following table shows the current application of fixed and switchable technology
on ASD hardware and the products which IMT is supplying today.  Screen
    Size
    Fixed
    Technology
    Switchable
    Technology
    Application
    IMT
    Products35"-100"
    Yes
    No
    Display and video
    wall
    28",
        46", 50", 55", 65", 85"
        1x3,
        3x3, 4x3 configuration25"-34"
    Yes
    No
    PC monitor
    27", 28"15"-24"
    No
    Yes
    Laptop
    N/A7"-14"
    Yes
    Yes
    Tablet
    7", 10"5"-6"
    Yes
    Yes
    Phone
    6"  Autostereoscopic
Display Solution We
provide a full series of ASD digital signage displays with very high quality 3D image. We can provide the following 3D Displays: i)
    A wide range of Glasses-Free 3D displays in ultra-high
definition ranging from 27" to 85";ii)
    Outdoor Glasses-Free 3D digital signage which are waterproof
and visible under sunlight making them suitable for use at bus-stop, stadium and street store-front;iii)
    Indoor Glasses-Free 3D digital signage offer high-brightness
making it suitable for use in shopping malls, hotels and casinos;iv)
    Indoor Glasses-Free 3D video wall using super thin bezel
panels. Total resolution can be up to 8K with outstanding Glasses-Free 3D effect; andv)
    Glasses-Free 3D mobile phones and tables ranging from
5" to 10" using switchable parallax barrier display, allowing users to enjoy high resolution image in normal 2D application
as well as watching 3D video and playing 3D games in 3D mode.    picture
    
    picture   25     ASD
Video Wall  IMT
has developed Glasses-Free 3D video wall comprising 3, 4, 9, 12 or 16 units of ASD displays. The video wall was on display at
the recent 2017 Hong Kong Electronics Show in October 2017 and the 2018 Consumer Electronics Show in Las Vegas in January 2018.  picture3x3 Screen video wall Glasses-Free
3D Mobile Device Solutions We
have developed switchable 2D/3D mobile device solutions based on Android platform. The device can be used as an ordinary Android
device such as mobile phone or tablet and it can be switched automatically from 2D mode to glasses-free 3D mode when the user
plays 3D video content or 3D video game.   picture
    
    picture Content
Management System IMT
provides a proprietary 2D/3D content management and distribution system ("CMS") to complement our 3D digital signage
products to create a networked advertising platform. This CMS can be sold as a standalone product or together with a network of
2D or 3D displays.   26     3D
Super Workstation IMT
has developed auto real-time conversion technology from 2D to 2D+Depth, 3D side-by-side and glasses–free 3D multi-view mode.
This conversion technology is embedded in our 3D super workstation (Marvel3DPro). This 3D super workstation will be used for content
conversion for 2D videos to 3D mode for the TV and movie industry.   picture
    
    picture3D Workstation Studio
    
    3D Workstation Servers   IMT
Software Products  Software
- VisuMotion VisuMotion
is a set of renowned professional software designed for 2D to 3D conversion as well as advanced 3D content creation. This software
can be a standalone product or complementary to Marvel3DPro Workstation. It is a user-friendly software which allows users to
easily create quality 3D images and videos from using the software and plugins. The software is not only catered for commercial
usage by the professionals in content design and production, but also particularly useful for design institutes and schools for
student training on 2D to 3D conversion and 3D content creation. We have enhanced the VisuMotion's functions and features so that
the software can be more widely used by the educational and professional sector. The software and plug-ins we offer are as follows.   VisuMotion
                                       z.l.i.c.e 3D V3.0 is a professional video editing and compositing application especially
                                       designed for multi-view 3D footage. The software features 2D to 3D conversion, complete
                                       2D+Depth workflow including declipse, import/export of native stereo view arrangements
                                       and file formats like StereoEXR (SXR) and MXF, shape/line functions and mathematical image
                                       functions. The application can perform real-time compositing and editing and preview on
                                       attached 3D device. Built-in graph filters allow flexible workflow set up with configuration
                                       nodes.
        VisuMotion
        3D Stereo Camera Plug-ins – This is a plug-in that enhances the 3D animation packages Autodesk 3D Studio Max and
        Maya by mature stereo rendering capabilities. This plug-in features 3D planes concept, simple control of stereo effect,
        real-time 3D preview on secondary 3D displays, rendering of multiple views, support all standard file formats and rendering
        of 2D + depth file format, including occlusion layers.
        VisuMotion
        Stereo Tools for z.l.i.c.e. 3D - This is a plug-in collection of special nodes and a powerful tool to convert two-view
        stereo footage into multi-view content for usage with glasses-free display. This plug-in features a high resolution support
        up to 4K resolution, selectable color space (RGB & YUV), flicker mode with speed value for view comparison inter exploration
        up to 32 views and camera rectification through calibration pattern footage.
    
    picturepicture   27     IMT
Delivers Total Service  IMT
provides total solution to our customers. IMT has all the technology solutions that is needed to support the entire ASD ecosystem.
We have 2D/3D video conversion technology for converting 2D or conventional 3D (SBS) video to ASD format, either in real time
or in high quality offline mode. We have also developed content management system to deliver ASD content to our displays to form
glasses free 3D digital signage networks. IMT also developed a series of ASD displays and video walls with superb video quality.
In the consumer level, IMT provides 3D mobile phones and tablets. In the future and with the core technology that IMT has developed,
we can provide new innovative ASD products so long as there are needs for the market and we try our best to be the first to provide
such products and services. This underlines the value of IMT as a technology and product innovation company.  Audio
Division  Branded
Distribution – Syllable branded products  Our
audio division provides a line of speaker products from wire to wireless in-ear headsets. Our new product lines for 2016 were
well received at the Hong Kong Electronics Show and the 2016 Consumer Electronics Show in Las Vegas. Our strategy is to work through
distribution channels for audio products and in the future these channels could carry some of our 3D phones and tablet products.
Furthermore, we are also looking to develop a line of speaker products to work with our 3D displays. Some of our speaker and headset
products are:   picture
    
    picture
    
    picture   28     Future
Developments  The
focus of the Group is to continue to develop its digital media / advertising in glasses-free 3D (autostereoscopic) platform. The
acquisition of MDL, a technology company that focuses on the development of autostereoscopic 3D technology which includes a proprietary
glasses-free 3D digital content management system, 2D to 3D content conversion system and 3D displays and mobile devices, has
laid the foundation for providing core technologies to enable the Company to expand its business scope from digital media and
advertising to a technology company in the ASD technology domain.  Our
main business focus in the coming years is to continue to develop state-of-the-art digital media related products and solutions
using our core technologies for both the consumer and industrial markets. Our market strategy is to sell our products and or solutions
to product marketing companies or joint venture with them. This will keep our sales and marketing team costs to a minimum and
allow the Company to focus on its core business which is on product and solution development. In the future when the Group has
acquired sufficient capital, we may build our own product sales and marketing team. In the meantime, we will continue to build
our reputation in the market as a technology solution provider. The Company expects our core technologies in glasses free 3D will
transform the Company to be a leader in ASD technology and solution provider.  In
the coming years, the Group will focus its development in the following area: 1)
We are working as an advisor to Guangzhou Marvel Digital Technology Ltd. ("GMDTL"), a related company, on the development
of the China National 3D Standard for the Chinese government. In November 2014, GMDTL had signed a contract with the China government
in a joint development of China National 3D Standard. In February 2016, GMDTL and MDL signed a cooperative agreement for MDL to
provide technical support and autostereoscopic 3D solutions to GMDTL. In return, GMDTL shall compensate MDL for not less than
RMB 10 million, equivalent to approximately US$ 1.5 million when GMDTL has received the related government research grant. 2)
We shall continue to develop the glasses-free 3D advertising networks in China through distributors and joint venture partners.
We shall concentrate to cost down our 3D displays, increase the functionality of our content management system, and develop more
novel business models in relation to this 3D digital media network. 3)
We have completed the development and started selling our state-of-the-art 2D/3D and 2K/4K super-workstations in 2015. The super-workstation
provides a highly efficient application for 2D to 3D content conversion and 2K to 4K intelligent resolution enhancement. We are
now developing an advanced version of our super-workstation so that both the image quality and processing speed can be further
enhanced/increased. 4)
We have started the development of an ASIC chip with 3D functions to provide a very cost effective solution to all our 3D products.
This ASIC 3D chip will be incorporated in most of the future ASD products so as to provide a better pricing strategy and increase
the market share. We plan to build a dedicated ASIC design team in the near future to expand our R&D capability, including
the design of the future chip set for incorporating the China National 3D Standard functions which will have a major impact in
the television industry in China. 5)
We have initiated a R&D development project in virtual reality ("VR") technology to meet the growing demand in
VR products. Our development shall include VR products, application software and VR games. 6)
We will develop specific business models to extend applications of our ASD products and solutions in vertical markets, e.g the
education, entertainment and medical industries. We
expect to continue our growth in revenue in the near future upon successful execution of the above business plans. When
more new technology has been developed, the future revenue stream of the Group may shift more on the sale of mature technology
and product solutions as well as on development and consulting service. With the successful acquisition of MDL, IMT will position
itself as a technology investment company focusing on acquisition of technology related companies or projects that have synergy
with our existing technologies and businesses. The goal is to own and expand the ASD technology ecosystem which the Group is building.
This can enable the Group to have significant influence in the ASD market. The
future business plans depend on adequate capital being available to the Group. The Company will be reviewing potential acquisitions
that can add value to the Group. The future development is dependent on the ability to have sufficient resources in funding, technology
and human capital to execute our business plans. Management will also seek synergistic acquisitions to build revenue and bring
in resources to complement and to supplement our internal capabilities to become a well-managed and fast growing technology company.   29     Analysis
of Auto Stereoscopic Display (ASD) technology market – the ASD ecosystem  3D
displays exhibit images with depth perception by using various technologies such as stereoscopic, multi-view, and 2D-plus-depth
display. Currently, these popular 3D displays need to be viewed with special 3D glasses in order to experience depth perception.
3D displays are used in numerous devices such as 3D TVs, mobile handsets, tablets, gaming devices, and head mount devices ("HMDs").  Since
the commercialization of 3D displays, TV service providers, advertising agencies, and broadcasters have been focusing on airing
more 3D content and displaying advertisements on 3D billboards. As a result, 3D technology has evolved as one of the fastest growing
display formats worldwide. Although the global 3D display market is still in its early phase, the increasing popularity of 3D
display is expected to lead to unprecedented growth during the forecast period. The increased penetration of high-bandwidth internet
is another major driver in this market.  The
increased adoption of 3D displays in the advertisement sector is a major trend witnessed in the market. To increase customer engagement,
vendors in the advertising sector are adopting autostereoscopic displays that enable the 3D effect without requiring the viewer
to wear 3D glasses. Extensive use of 3D projection and display in the healthcare sector is another major trend being witnessed
in the market.  ASD
technology is a disrupting technology as it brings in better viewing experience in 3D mode without the need for special glasses.
This technology can be integrated into any products that uses LCD display panels. As most of the product displays use LCD panels,
ASD technology will potentially replace all products that incorporate LCD panels when ASD technology achieves broad acceptance
and competitive pricing. In addition to the current 3D display market that ASD technology can capture, there are new applications
that ASD technology (3D without glasses) can enhance our lifestyle and productivity in the digital informative society we live
in. New applications will be created by tapping into scenarios like 3D without glasses in education, entertainment, architecture,
and medical industries. We are seeing some of these new applications in the education classrooms and in surgical instruments in
the operating room. The market potential for ASD products and solutions is equal to society demand for 3D imagery in every digital
display.  In
order that ASD technology to be adopted by the consumers, there need to be enough 3D content available for ASD technology adopter
to consume. The buildup of an ASD ecosystem that includes a variety of ASD products and services together with plentiful ASD content
will enable the technology to be adopted in the new market. The sections below will explain different technology needed to build
this ASD ecosystem.  Technology
overview  Auto
Stereoscopy is any method of displaying stereoscopic images (adding binocular perception of 3D depth) without the use of special
headgear or glasses on the part of the viewer. Because headgear is not required, it is also called "glasses-free 3D"
or "glasses less 3D". There are two broad approaches currently used to accommodate motion parallax and wider viewing
angles: eye-tracking, and multiple views so that the display does not need to sense where the viewer's eyes are located.  There
are 3 main autostereoscopic displays technologies, include parallax barrier, lenticular lens and directional backlight displays,
used to create images on ASD.   30     ASD
Technology Analysis  1)
Parallax Barrier  This
method is widely used in modern 3D liquid crystal displays. Parallax barrier is a special device with a series
of precision slits that's placed in front of LCD, serving as a filter for output image perception. The slits allow left and right
eye to see their corresponding image, which is produced by a different set of pixels. That is how the illusion of 3D vision is
created by parallax barriers. To have a clearer understanding of this method see the image in Diagram 4.1. The examples of
parallax barrier employed in consumer products are Nintendo 3DS game console, HTC EVO 3D and LG Optimus 3D smartphones. Also
used in Range Rover's navigation system, the parallax method allows both the driver to view GPS directions and a passenger to
watch movies from the same display simultaneously.  However,
the parallax method is not perfect, because it has some disadvantages. First one is that in order to experience stereoscopic
3D effect the viewer must be positioned at a certain angle to the display. That is actually not a big problem for video game consoles
or smartphones, but not good when it comes to 3D TV sets, laptops etc. Another disadvantage is that the count of horizontal pixels
that work to create a different image for each eye is limited to one half. Another drawback for mobile devices is the barrier
will block a certain percentage of light going through it. In order not keep the display the same brightness, more energy is need
to power the backlight which will decrease the battery power of the device.  2)
Lenticular Lens  The
second mostly used method of glasses free 3D is lenticular lens technique. In general, the lenticular
method is based on the use of magnifying lenses. Those lenses are set in arrays to produce slightly different images
when viewed from different angles.  They
are also constructed in such way that when you see the image from one angle and then move to another angle the image changes as
well and even moves (see Diagram in 4.1).  3)
Directional Backlight  Multi-directional
diffractive backlight technology permits the rendering of high-resolution and full-parallax 3D images in a very wide view zone
(up to 180 degrees in theory at an observation distance of up to a meter). Pixels associated with different views or colors are
spatially multiplexed and can be independently addressed and modulated at video rate with an external shutter plane. The key factor
is that the guided wave illumination technique must be based on light-emitting diodes that produce wide angel multi-view images
in color from a thin planar transparent light guide. Directional backlight technology is still on the way of developing and not
available for mass production.  Diagram
4.1 – Different types of technologies to create ASD images   picture
    
    picture
    
    pictureParallax Barrier
    
    Lenticular Lens
    
    Directional Backlight    31     ASD
Software  ASD
software generally refers to a series of programs applied in converting 2D/3D to ASD content. Typically, for mobile phones or
tablets, such programs may include applications from the app store to convert the 2D/3D content into ASD content. For ASD game
consoles, there are default programs equipped inside to realize 3D effects. Converting 2D/3D to ASD mode can be done in either
real time conversion or offline conversion. Real time conversion involves hardware acceleration and is done using dedicated computer
hardware such as FPGA (field programmable gate array) or ASIC chip. This needs advance development work that few companies have
the resources to tap into this development level. The offline conversion uses dedicated computer program is do the conversion.
We have developed VISUMOTION which is a software program for 2D/3D to ASD content. On the other hand, a number of dedicated real
time conversion solution based on FPGA hardware have been developed in the past two years. We have started to develop an ASIC
chip for such conversion purpose and we consider this ASD conversion technology will form the base technology for the Company
to stay at the technology forefront.  ASD
Content  ASD
content refers to the photos, games, animations and other video content, which can be played in ASD hardware terminals and seen
in the three-dimensional form by naked eyes without any viewing aids.  Currently
the mainstream to create ASD content is the conversion from 2D content. With the continuous development of technology, it is believed
that the ASD content could be directly generated in the near future.  Services  ASD
technology has high technology barrier for new players. Currently, ASD technology B2B service may including consulting service,
which aims to provide customized and integrated ASD solution based on the need from clients; and technology support, which aims
to help clients to fix the technical problems. Content conversion service can also be established. For example, in the digital
advertising sector, almost all advertising content is in 2D mode. In order to display in the ASD digital signage, the 2D video
has to be converted to 3D or ASD mode. In the future, one-stop ASD solution service throughout the process from consulting to
post-maintenance tends to become the trend.  Technology
Analysis of 2D/3D Switchable Display Technology  Fixed
lenticular technology is a prevailing technology used by most ASD displays. However, fixed lenticular has a big drawback as it
does not perform well in display 2D content, especially the display of text. For mobile device such as smart phones, users spend
a lot of time in surfing the Net. Fixed lenticular display provide a bad viewing experience in displaying text. Despite the additional
cost of deploying switchable display technology, mobile phones will adopt 2D/3D switchable display.  Parallax
barrier and lenticular lens are core methods to achieve switchable technology between 2D and 3D. Currently, parallax barrier is
more commonly available in market due to the simple application and lower costs. Meanwhile, application of lenticular lens is
considered as advanced switchable technology with better visual effect and such technology is still under development.  Switchable
technology with parallax barrier is considered as an easy and low cost option, but the main drawback is reduced brightness of
display, hence the method is battery consuming especially for some consumer electronics such as smartphone to maintain the normal
brightness to viewer.  Lenticular
lens is generally regarded as ultimate technology in switchable 2D/3D display. Compared with parallax barrier, switchable lenticular
lens allows the display of 2D image with original resolution and switching to 3D image with equal brightness.  We
have developed our ASD mobile phone using switchable parallax barrier technology. The mobile phone has a well balance design which
presents a very good 3D image effect, while still keeping the cost of the product in an acceptable level. We believe we are one
of the few companies that can develop such ASD mobile phone with outstanding image quality. There are a few ASD mobile producers
in the market which are using fixed lenticular technology. Fixed lenticular display has a big drawback. It is not a good experience
when viewing text, especially for surfing the net in a small screen. With switchable technology, the mobile phone will just act
like an ordinary 2D mobile phone when the ASD function is switched off. When it comes to playing 3D video or 3D game, the 3D mode
will be switched on automatically. We shall only consider applying fixed lenticular technology to mobile phones when the problem
of reading 2D text has been solved.   32     Market
and Industry Analysis  3D
Display Market  Currently,
the 3D display market is in its early stage. Most of the 3D-enabled electronic devices require 3D glasses to experience the 3D
effect. The usage of these 3D glasses is limiting the adoption of 3D displays as the glasses are uncomfortable to wear. For instance,
wearing 3D glasses for a long period sometimes causes headache or eyestrain. Therefore, to eliminate the use of glasses, vendors
in 3D display market are focusing on adopting autostereoscopic technology, which delivers the 3D effect to the naked eye.  However,
autostereoscopic technology currently has limitations because of its high cost and image quality. Therefore, the potential commercialization
of this technology will be seen in the near future as the vendors in the 3D display market are focusing on developing ideal 3D
displays using autostereoscopic technology.  Market
size by revenue  The
global 3D display market is growing at a CAGR of 26.8%. The market is growing at an impressive rate because of the increasing
popularity of 3D technology. Some Hollywood movies such as The Lego Movie and Captain America: The Winter Soldier have been featured
in 3D format and this is indicative of the popularity of this format. The market is also witness increased adoption of 3D displays
in the advertisement sector. The increased popularity of 3D technology has stimulated advertising agencies to exhibit 3D content
on billboards and feature 3D advertisement films.  The
significant increase in the growth rate of the global 3D display market is attributed to the increased penetration of 3D TVs and
the popularity of 3D technology. The increase in 3D content are expected to contribute to the growth of the global 3D display
market. Digitization is one of the major factors driving the demand for 3D LED TVs, which, in turn, contributes to the growth
of the global 3D display market.  Recent
advanced in 3D display technology, along with the improved visual experience, picture clarity, superior performance, and high
resolution of 3D display have led to their increased adoption in numerous markets, industries, and applications. These benefits/features
of 3D displays are expected to contribute to the growth of the global 3D display market. Below is the ASD market overview by product
category in China and Hong Kong.  Diagram
4.2 - Auto Stereoscopic Display (ASD) Market Overview - Overall Market Size and Breakdown by Product Category - the PRC  USD
Million picture  USD
    Million sales
    2011
    2012
    2013
    2014
    2015
    2016E
    2017E
    2018E
    2019E
    2020EHardware
    181.7
    213.1
    257.0
    316.4
    405.6
    530.1
    697.1
    925.1
    1,231.3
    1,656.1Others
    69.5
    77.5
    88.3
    104.6
    128.7
    164.9
    214.7
    284.0
    384.1
    528.1Total
    251.2
    290.6
    345.3
    421.0
    534.3
    695.0
    911.8
    1,209.1
    1,615.4
    2,184.2 Exchange
Rate: 1 USD=6.6 RMB Source:
Frost & Sullivan report commissioned by the Group (Exhibit 15.2)   33     Diagram
4.3 - Auto Stereoscopic Display (ASD) Market Overview - Overall Market Size and Breakdown by Product Category – Hong Kong  USD
Million picture  USD
    Million sales
    2011
    2012
    2013
    2014
    2015
    2016E
    2017E
    2018E
    2019E
    2020EHardware
    38.4
    45.4
    55.7
    68.6
    86.0
    108.5
    138.2
    177.1
    228.8
    300.9Others
    12.3
    14.3
    16.9
    20.2
    24.3
    30.6
    39.1
    50.3
    65.2
    87.1Total
    50.7
    59.7
    72.6
    88.8
    110.3
    139.1
    177.3
    227.4
    294.0
    388.0 Exchange
Rate: 1 USD=7.8 HKD Source:
Frost & Sullivan report commissioned by the Group (Exhibit 15.2)  Market
size by volume  The
volume shipment of 3D displays is growing at a CAGR of 19.9%. Increased adoption of 3D display by 3D TV, smartphone, and portable
display device manufacturers has led to an increase in the volume shipments of 3D displays.  The
increased demand for 3D TVs and the rise in the number of 3D advertisements are the factors driving the increase in the shipments
of 3D displays worldwide. Consumers prefer 3D content because of its unique visual appeal. In addition, with the increase in popularity
of 3D technology, advertising agencies are employing autostereoscopic 3D technology to display advertisements on billboards. The
impact of 3D technology's immersive and unique visual quality has led to a substantial increase in brand recognition, loyalty,
retention, and advertisement recall across the globe.  Market
Segmentation by Application  Global
3D display market is segmented as follows: •  
TVs •  
Smartphones •  
Others - include tablets, portable gaming devices, monitors and HMDs.  The
majority of the revenue in the global 3D display market was generated from the 3D TVs segment in 2014. This was followed by the
smartphones segment, wherein the penetration of 3D displays in smartphones is expected to rise significantly in the coming years.
The others segment, which includes applications such as tablets, portable gaming devices, and HMDs will contribute significantly
to the growth of the global 3D display market.  Consumers
are adopting 3D technology at a significant pace because of the increasing popularity of 3D technology and the increasing 3D content
worldwide. Moreover, numerous Hollywood movies such as Godzilla, 300, Rise of an Empire and animated movies such as Lego and How
to Train Your Dragon. As a result of this consumers are more drawn to the 3D visual experience, and hence the demand for 3D TVs
is increasing. Therefore, the demand for 3D displays form the 3D TVs segment is increasing significantly. Moreover, with the advent
of autostereoscopic technology, the 3D TVs segment will flourish as it eliminates the usage of glasses for 3D content.  However,
there are challenges in the market with regards to the picture clarity when viewed from different angles in a TV. As a result,
3D display manufactures are focusing on eliminating such technical challenges, to deliver superior customer satisfaction. Portable
devices such as gaming devices, smartphones, and tablets will adopt 3D technology at a greater pace because consumers can adjust
the eye angle accordingly as these are handheld devices.  The
3D advertising space and 3D gaming is gaining traction in the market, which will contribute significantly to the growth of the
global 3D display market.  Below
is a market size breakdown by application as of 2015 and 2020 for the China and Hong Kong which shows Gaming & Entertainment
and advertising as the largest market size segment.   34     Diagram
4.4 - Market Size Breakdown by Application - the PRC  picture   Source:
Frost & Sullivan report commissioned by the Group (Exhibit 15.2)  Diagram
4.5 - Market Size Breakdown by Application - the Hong Kong picture   Source:
Frost & Sullivan report commissioned by the Group (Exhibit 15.2)   35     Market
Growth Drivers  Some
of the key growth drivers in the 3D market are as follows:  Growing
Market Demand Up
to now, in Asia, ASD technology has limited customer base with limited application scope. The high research and development cost
of ASD products leads to high price of ASD products, which are hardly affordable by the individuals. Also the immaturity of ASD
technology has restricted its application. Driven by the growing maturity of related technology and increasing demand for three
dimensional experience from the mass market, with the expanding range of application, considerable growth tends to be stimulated
in ASD market.  Continuous
Upgrade of Technology For
any emerging high-tech industry, the technology innovation is widely considered to be the most effective productivity force. ASD
technology, especially 2D/3D conversion technology has kept developing during the recent years, and now the leading ASD players
are still making effort to promote the success of ASD technology upgrading. In Korea, the traditional giant companies prefer to
cooperate with tech innovative companies from overseas so as to accelerate the technology integration and upgrading.  Decrease
in product cost As
the ASD technology progresses, the key production process of ASD panel modules gradually improves by both automating the production
and increasing the yield rate of the products. On the other hand, the production volume gradually ramps up with increasing demand.
This contributes to a significant lowering of the cost of the ASD modules which is a major cost factor in all ASD products.  Support
from Government  -
    In order
    to propel the upgrade of the traditional IT industry, Ministry of Industrial and Information Technology (MIIT) in China organized
    a seminar in 2016 to discuss the innovative technology of color TV, clearly pointing out the significance of promotion the
    development of ASD TV, which likely to stimulate the growth of ASD in China.-
    Korea Communications
    Commission, together with Ministry of Culture, Sports, and Tourism, set funds to support the investment on research, manufacturing
    and talent cultivation of 3D industry, aiming to launch holographic technology in the year 2020.-
    Japan holds a large
    number of ASD patents and plays a leading role in the global ASD market, especially in the field of ASD software. National
    Institute of Information and Communication Technology (NICT) in Japan has published periodicals on ASD, implying great attention
    on ASD industry. Japan government also supports and recommends the use of ASD products in the coming Olympics in 2020.  Dynamic
Venture Capital Since
2013, more venture capital has been invested in ASD industry in China. It is expected that the benefits from these investments
will show the technical and financial results in the coming years. Whereas the investment in ASD industries in Japan and South
Korea occurred much earlier which has placed them as leaders in ASD technology.  Increased
in 3D video content With
the commercialization of 3D displays, the global 3D display market has been witnessing an increase in 3D video content worldwide.
Although the market is still in its early stage, the penetration of 3D technology has been on the rise as 3D display panel are
being used in mobile handsets, tablet PCs, and in digital signage for advertisement. The increased volume of 3D video content
also has a significant impact on its growing popularity, which has led to the emergence of several 3D channels over the past few
years.  Increased
adoption of 3D displays in advertising sector The
high popularity of 3D technology has encouraged advertising agencies to display 3D content on billboards and feature 3D advertisement
films. These agencies have also employed autostereoscopic 3D technology for advertising is expected to foster the growth of the
global 3D display market.  Use
of 3D displays in the healthcare sector The
healthcare sector is expected to increasingly adopt 3D display to help doctors diagnose patients more effectively. 3D projectors
will also help doctors identify and decide on the most effective form of treatment. They can also be used as an alternative to
microscopes during surgical procedures. 3D projectors can accurately display scientific content. They also display flawless images
and, at times, are tailored for clinical reviews. Autostereoscopic displays are much welcome to replace conventional 3D with glasses,
as the doctors no longer need to wear special glasses in surgical procedures and clinical reviews.  Increased
in 3D display applications The
number of applications of 3D projectors and displays has increased over the past few years. 3D displays are presently used in
flat panel TVs, portable gaming devices, and advertisement billboards. They are also expected to be featured extensively in several
devices in the future, including 3D smart displays, mobile handsets, displays used in the healthcare sector, notebooks, monitors,
and large-sized displays. This growing number of 3D display applications will lead to an increased penetration of 3D displays
and improve the growth prospects of the market.   36     Increased
penetration of high-bandwidth internet The
rapid development of infrastructure capable of supporting high-speed internet worldwide will facilitate market growth as it will
lead to increased adoption of 3D displays. Fiber-based, high-capacity broadband connection rollouts are increasingly being witnessed
in developed countries in the Americas and the EMEA. High-bandwidth networks also enable seamless transmission of live, high-quality
content over the internet. Thus, the high penetration of high-speed internet technologies in the market will lead to increased
adoption of small and medium-sized 3D display devices.  Increased
adoption of portable 3D gaming devices Portable
3D game devices have been gaining popularity worldwide, especially after the consumer electronics company Nintendo released its
device Nintendo 3DS in the market. This device, which supports 3D gameplay, does not require glasses as it uses autostereoscopic
3D technology. Because of its popularity, many 3D gaming devices are expected to enter the market. Thus, the entry of several
vendors into the portable 3D gaming devices domain will increase the market size and foster the growth of the global 3D display
market.  Emergence
of 3D tablet PCs A
few tablet PCs with 3D displays are available in the market, and autostereoscopic technology-based 3D tablet PCs are expected
to be commercialized in the near future. The market will see the entry of several tablet PC manufactures, which, in turn, propels
the growth prospects of the global 3D display market.  Need
to replace analog displays with digital displays Several
countries have legislated the switch-over of analog TV broadcasts to digital as this is one of the stringent regulations imposed
by governments for digitalization. This has been a major driving factor for the increased adoption of digital TVs. Digitization
has led to increased demand for 3D displays.  Trends
in ASD Market  The
three developing trends for autostereoscopic display market are i) expanding application fields, ii) higher level of interactivity
and iii) standardization of the industry.  Expanding
Application Fields The
application of ASD is still in the exploratory stage. For now, the application field mainly include gaming & entertainment,
advertising, education and medical fields. In the future, ASD is estimated to further expand its application in existing fields
and explore new land in architecture, military and other industries. With ASD technology getting more mature, manufacturing and
e-commerce are also likely to join the downstream of ASD industry. Therefore, ASD industry is estimated to embrace a great surge
in the future.  Enhance
interactivity Limited
by the technology, content and presentation form of the current ASD, the audience has no choice but to play a passive role to
accept the video information. However, in the long term R&D team will lay more emphasis on humanization design and better
user experience, and consumers are expected to raise higher requirements on the maneuverability of ASD products. As a result,
higher interactivity tends to become a new focus for product development in ASD market.  Standardization
of Industry The
ASD industry is typically of an emerging technology where there is a lack of uniform product standard. There needs to be a push
towards a unified ASD industry standard such as input and output interface standard, media coding and encoding protocol, etc.
Once the standards have been established then the industry can move quickly to bring this technology to the masses. Through our
affiliate, we are now working the unified ASD industrial standard in China with the State Administration of Radio, Film and Television
of the People's Republic of China (SARFT).  Competitors  The
market for glasses-free 3D technology is still in its early stage, and there are very few competitors worldwide. Nonetheless,
there are many established and early stage companies that address the 3D display market in one way or another, including makers
of 3D televisions and mobile phones, such as Panasonic Corporation, Samsung Electronics Corporation, Ltd., Sony Corporation and
X6D Limited. For the most part, these companies do not market 3D autostereoscopic products, and thus do not compete directly with
the products and services we seek to market. However, at this time, we consider them to be competitors generally in the effort
to market stereoscopic display (with glasses) solutions to end user businesses. They have different markets apart from this new
autostereoscopic (glasses-free) 3D market. Philips is the pioneer in autostereoscopic technology. However, Philips does not produce
or sell autostereoscopic 3D products for many years. Other companies operating in this domain such as Magnetic 3D, Alioscopy,
and Dimenco have started operation earlier than us. They do have similar technology that we have, but we believe they do not have
the cost advantage that we have. We have strategically well positioned our base operation in Hong Kong and China where we believe
we have cost effective outsourcing manufacturing strategy. In addition, we have a wider product and solution offerings than most
of our competitors. On the other hand, very few of these competitors are public listed companies. We shall have a better advantage
if we can be listed on NASDAQ such that we can have a better position to raise adequate capital for our product development.   37     The
ASD market in Asia is fragmented with different players involved in research and development, production of lamination services,
production of the autostereoscopic display and production of complete ASD devices. At retail level, there are approximately over
50 brands of ASD devices available in the market. Japan and China are the leading countries in Asia featured with a number of
reputable market players who are capable to supply ASD devices to different countries worldwide.  Market
Concentration The
competition of ASD market at retail level is mainly triggered by selling price, quality and user acceptance. There are a variety
of ASD products available in market such as smartphones, digital signage, TV and tablets, and the number is growing along with
the market expansion and technology advancement. ASEAN and China are the fast growing developing regions in terms of ASD technology
development and product application in Asia. Some market players are capable to offer ASD solution and service to cooperate customers
from, for example, the advertising industry.  Technology
Competition The
majority of ASD devices in markets are based on fixed lenticular and switchable parallax technology. However, leading market players
are putting emphasis on research and commercialization of lenticular-based switchable ASD technology which offers better 3D visual
effect and brightness control than the existing parallax barrier method.  Product
Service Some
ASD solution providers focusing on corporate customers may offer related services such as content conversion for videos and games
apart from ASD hardware. The corporate customers are mainly from advertising and entertainment industries.  Market
Challenges  Some
of the major challenges faced by the vendors in the market are as follows:  •
  Lack of interoperability among stakeholders •
  Lack of standardization of 3D displays •
  Increased selling price of 3D displays •
  Limitations of autostereoscopic 3D display technology  Lack
of interoperability among stakeholders The
adoption of 3D flat panel TVs plays a significant role in the growth of this market as it accounts for more than 80% of the overall
demand for 3D displays. The adoption of these 3D flat panel displays depends on the availability of 3D video content. The more
3D content available, the higher the adoption rate of 3D TVs. However, the lack of interoperability among the players present
in the 3D content delivery value chain works against an increase in 3D video content. These players include content owners, flat
panel manufactures, satellite operators, and platform operators.  Lack
of standardization of 3D displays 3D
displays have been commercialized recently and their development is still in an early stage; hence, 3D display technology is yet
to be standardized. The lack of standards has reduced the adoption rate of 3D displays among consumers. Standardization is essential
to avoid confusion among potential buyers and to avoid burdening them with too many options. It is also essential for smooth interoperability
among players in the value chain.  Increased
Selling Price of 3D displays The
market is expected to witness an increased in the selling price of 3D displays because of the increased cost of raw materials
and development. An increase in selling price would transfer the cost pressure to consumers. Another factor behind the increased
in the selling price is the high cost of producing autostereoscopic 3D displays as the mass production process has not been established.  Limitations
of autostereoscopic 3D display technology All
3D technologies, except autostereoscopic technology, require glasses to experience the 3D projection. But autostereoscopic technology
is expensive and difficult to be integrated with large-sized displays. The technology also has technical limitations pertaining
to the viewing angle. It can also lead to visual fatigue, though this is only for those lower quality ASD display suppliers, when
the user is viewing the display for long periods of time. Due to some of these limitations, the cost of autostereoscopic displays
is expected to remain high, which will result in slow rate of adoption.   38     Market
traction  The
revenue generation of the global 3D display market is rising because of the increase in 3D content worldwide. The increasing popularity
of 3D technology among end-consumers and the rise in the launch of 3D Hollywood movies are the major factors driving the demand
for 3D enabled devices. Currently, the enhanced user experience through 3D technology is driving the market. The 3D display market
is dominated by 3D TVs, and other application areas such as smartphones, tablets, and HMDs will take off in future as 3D because
mainstream format.  With
the increase in the number of gamers worldwide, 3D enabled gaming consoles are gaining market traction. The unique gaming experience
created through these displays is engaging users. As traditional advertising has almost reached saturation, companies are focusing
on 3D display billboards to enhance their respective customer bases. Healthcare is another booming sector, wherein doctors use
3D displays to better analyze 3D images.  Market
attractiveness  The
industry is influenced by many factors that either drive or curtail market growth. An increase in 3D content, rapid advances in
technology, and the increased adoption of 3D displays in the advertising and healthcare sectors are some of the significant trends
fueling market growth.  Rapid
advances in technology have prompted OEMs to upgrade their systems. But this has added to the costs for vendors. Moreover, with
the emergence of autostereoscopic technology, vendors in the global 3D display market are focusing on eliminating the limitations
associated with this technology, as autostereoscopic technology enables a user to see 3D visuals without the use of glasses.  Competition
among vendors is expected to increase because of increased demand for mobile devices such as smartphones and tablets in both developing
and developed regions. Most vendors are adopting new technologies to match global standards. 3D displays are penetrating numerous
markets such as that of smartphones, tablets, gaming devices, monitors, HMDs, healthcare, and advertising. The use of 3D displays
in HMDs, in particular, will find increased acceptance because of the enhanced visual experience it offers.  ASD
Reginal Development  The
ASD market in Asia has experience rapid development during recent years, and it still contains tremendous potential for the future
growth. Japan, South Korea, China and ASEAN are considered to be the major engines to propel the Asian ASD market from the perspective
of technology advancement or market potential, and these four regions represent different competitive advantages. In the coming
decades, with the increasing level of integration of the ASD industry in different regions, the Asian ASD market is estimated
to embrace a brilliant future.  China The
ASD market in China has demonstrated increasing competition. The continuous entry of new players has led to a relatively fragmented
market status. The ASD market in China is still in the period of rapid development, so the number of new entrants tends to keep
increasing. For now, China represents a high efficiency in the process of industrialization and application development of ASD
products.  ASEAN The
ASD market in AEAN has not yet fully established and the local ASD players have not emerged so far. Due to the relatively inexpensive
labor force, many overseas ASD players are transferring their hardware manufacturing facilities to Southeast Asia.  Korea Many
traditional technology giants in Korea have been striving to develop ASD business, such as Samsung, LG, Maxon F-Vision, etc.,
who are leading the development of ASD market in Korea. The technology communication environment in Korea is open and free. Most
of the local players in Korea are willing to receive the cooperation from overseas. It is projected that the competition in the
ASD market of Korea tends to become stiffer in the future with the introduction of new foreign entrants.  Japan The
ASD market in Japan demonstrates that highest market concentration ratio all over Asia. Both the government and relative companies
commit great investment and resources on research development and promotion of ASD. Japan has been among the leading countries
in ASD technology in Asia, especially in software. However, Japan shows a conservative attitude toward technical exchange communication
with overseas companies.   39     Sourcing
and Manufacturing We
will subcontract the production of our hardware products to third party subcontract manufacturers. Such manufacturers produce
these products using OEM parts under specifications and licenses granted, as necessary, by our Company. This would reduce the
capital requirements to maintain and support a manufacturing infrastructure. Marketing,
Distribution and Sales We
are currently exploring further business opportunities with various distributors in China, Asia and the rest of the world for
our audio and ASD products. For our ASD products we have established distributors in major cities in China. We are also in the
process of building our own brand for our ASD and audio products which we intend to launch when we have the necessary resources
available. Sources
and Availability of Raw Materials and Principal Suppliers For
our ASD products we rely on certain critical components in the market place. Our principal suppliers are supplying us with LCD
panels and computer hardware. Inventory,
Operating Capital and Seasonality Our
inventory levels are expected to be modest relative to our sales. Our manufacturing policy is to manufacture to order. Thus we
would not expect to keep much inventory unless under extraneous circumstances such as material shortage or expected prolonged
manufacturing interruption i.e. labor strike. We
will monitor our operating capital to meet our obligations as they come due. We monitor our operating budgets in view of our operating
cash flow requirements. We
do not expect any seasonality to our business other than normally expected in the consumer electronics business where there is
a general let down in the first quarter of each year after the Christmas season. Dependence
on Major Customers In
2016 and 2017, our major sales are our Marvel 3D Pro workstations, CMS, software and technology solutions and ASD displays. These
products are normally sold as a system; therefore, our sales are focused on a few customers. In 2017 and 2016, our largest 5 customers
accounted for 86% and 84% of our revenue, respectively. Going forward, we will appoint distributors to sell our products and services,
and we will maintain a very small sales and marketing team in order to keep our operating costs low. Each of these distributors
will have their own major customers, but consider as a whole, we are not dependent on only a few specific customers in order to
derive sales as we build up our distributor network and customer base.   40     Research
and Developments  We
outsource basic research to local universities and research institutes on research and development of advanced technology in 3D
imaging. The research outcome from these research entities will be either owned by us or under exclusive or non-exclusive licenses
to us. We maintain our own development team to further develop products and solutions which we foresee to have potential markets.
This kind of two-step development will be best suited for small to medium size technology companies in order to keep a balance
in R&D budget. We shall further expand our internal R&D team when we have enough earnings or have acquired enough capital
to grow. Intellectual
Property Pivotal
to the development and commercialization of our ASD products is intellectual property protection for the underlying technology
and the product candidates. The licenses we hold are further described on page 52 under "Patent Portfolio". In
addition to patent protection, we rely on unpatented trade secrets, know-how and other confidential information as well as proprietary
technological innovation and expertise that are protected in part by confidentiality and invention assignment agreements with
our employees, advisors and consultants. Patent
matters in electronics industry are highly uncertain and involve complex legal and factual questions. The availability and breadth
of claims allowed in electronics patents cannot be predicted. Statutory differences in patentable subject matter may limit the
protection IMT can obtain on some or all of its licensed inventions or prevent us from obtaining patent protection either of which
could harm our business, financial condition and results of operations. Since patent applications are not published until at least
18 months from their first filing date and the publication of discoveries in the scientific literature often lags behind actual
discoveries, we cannot be certain that we, or any of our licensors, were the first creator of inventions covered by pending patent
applications, or that we or our licensors, were the first to file patent applications for such inventions. Additionally, the grant
and enforceability of a patent is dependent on a number of factors that may vary between jurisdictions. These factors may include
the novelty of the invention, the requirement that the invention not be obvious in the light of prior art (including prior use
or publication of the invention), the utility of the invention, and the extent to which the patent clearly describes the best
method of working the invention. In short, this means that claims granted in various territories may vary and thereby influence
commercial outcomes. While
we intend to seek patent protection for our 3D products and technologies, we cannot be certain that any of the pending or future
patent applications filed by the company, or licensed to us, will be approved, or that IMT will develop additional proprietary
products or processes that are patentable or that we will be able to license any other patentable products or processes. IMT cannot
be certain that others will not independently develop similar products or processes, duplicate any of the products or processes
developed or being developed by the company or licensed to us, or design around the patents owned or licensed by us, or that any
patents owned or licensed by us will provide us with competitive advantages. Furthermore,
we cannot be certain that patents held by third parties will not prevent the commercialization of products incorporating the technology
developed by us or licensed to us, or that third parties will not challenge or seek to narrow, invalidate or circumvent any of
the issued, pending or future patents owned or licensed by us. Our
commercial success will also depend, in part, on our ability to avoid infringement of patents issued to others. If a court determines
that we were infringing any third party patents, we could be required to pay damages, alter our products or processes, obtain
licenses or cease certain activities. We cannot be certain that the licenses required under patents held by third parties would
be made available on terms acceptable to us or at all. To the extent that we are unable to obtain such licenses, we could be foreclosed
from the development, export, manufacture or commercialization of the product requiring such license or encounter delays in product
introductions while we attempt to design around such patents, and any of these circumstances could have a material adverse effect
on our business, financial condition and results of operations. We may have to resort to litigation to enforce any patents issued
or licensed to us or to determine the scope and validity of third party proprietary rights. Such litigation could result in substantial
costs and diversion of effort by us. We may have to participate in opposition proceedings before the relevant patent office, or
in interference proceedings declared by the United States Patent and Trademark Office, to determine the priority of invention
for patent applications filed by competitors. Any such litigation interference or opposition proceeding, regardless of outcome,
could be expensive and time consuming, and adverse determinations in any such proceedings could prevent us from developing, manufacturing
or commercializing our products and could have a material adverse effect on our business, financial condition and results of operations.   41     Patent
Portfolio The
following table presents our portfolio of patents and patent applications, including their status (as at December 31, 2017) and
a brief description of their respective inventions.  Patent
    Owner
    Title
    Patent
                                         No.
        /Application
        No.
    Status
    ExpiresVisumotion
                                         International Limited
        (A
        wholly owned subsidiary of MDL)
    (i) Method
                                         for processing a spatial image
    EP
    2172032
    Granted
    in Germany
    June
    2028EP
    2172032
    Granted
    in FranceEP
    2172032
    Granted
    in U.K.4988042
    Granted
    in JapanUS
    8,817,013
    Granted
    in U.S.(ii) Method
                                         for stereoscopic illustration
    2010
    80019861.4
    Granted
    in China
    May
    2030US
    8,797,383
    Granted
    in U.S.102010028668
    Granted
    in GermanyIndependent
                                         party - Versitech Limited
        (A
        subsidiary of the University of Hong Kong)
    (i) A
    depth discontinuity-based method for efficient intra coding for depth videos
    62/199,727
    Provisional
    Patent in U.S. These patent rights in relation to 3D video encoding and transmission will be assigned by the owner to Marvel
    Digital Limited in the event of either (1) IPO of MDL shares or (2) the 3D video technologies covered by the Patent Rights
    is approved by PRC authority as an industry standard
    N/A(ii) Global
    and major object motion estimation, compensation and efficient realization for depth compression
    62/199,754(iii) A
    multi-overlay variable support and order kernel-based representation for image deformation and view synthesis
    62/199,702(iv) Auxiliary
    Data for Artifacts-Aware View Synthesis
    62/285,825(v) Shape-adaptive
    model-based codec for loss and lossless compression of binary images
    62/300,502Marvel
                                         Digital (Shenzhen) Limited
        (A
        wholly owned subsidiary of MDL)
    Method
    and apparatus for Chroma interpolation of video image
    200710070313.4
    Granted
    in China
    July
    2027A
    Universal Stereo Image Synthesis Method Based on Lenticular Lens for LCD Stereoscopic Display
    200810062513.X
    June
    2028A
    Method of Virtual View Synthesis Based on Depth and Occlusion Information
    200810062811.9
    July
    2028A
    Method of Extracting Hierarchical Image for 3D TV
    200810062810.4
    July
    2028A
    Multichannel Video Stream Coding Method Based on Depth Information
    200810062864.0
    July
    2028Multichannel
    Video Stream Encoder and Decoder Based on Depth Image Rendering
    200810062865.5
    July
    2028A
    Method of converting 2D video to 3D video in 3D TV system
    200910102114.6
    August
    2029A
    Depth Extraction Method of Fusing Motion Information and Geometric Information
    200910102153.6
    August
    2029    42     Patent
    Owner
    Title
    Patent
    No./Application No.
    Status
    ExpiresMarvel
                                         Digital (Shenzhen) Ltd.
        (A
        wholly owned subsidiary of MDL) (Continued)
    A
    Method of Layered B Predictive Structural Arrangement with High Compressibility
    200910155883.2
    Granted
    in China
    December
    2029A
    Method for Expressing 3D Scene and its TV System
    201010039540.2
    January
    2030A
    Virtual View Method Based on Video Sequence Background Modeling
    201010039539.X
    January
    2030A
    Depth Representation Method Based on Optical Flow and Image Segmentation
    201010101197.X
    January
    2030Extraction
    method of occlusion information in stereoscopic image pairing
    201010141105.0
    April
    2030A
    Method of Generating Virtual Multiview Images Based on Depth Graph Layered
    201010228696.5
    July
    2030A
    3D Augmented Reality Method for Multiview Stereoscopic Display
    201110412061.5
    December
    2031Depth
    image post-processing methods
    201110460155.X
    December
    2031Marvel
                                         Digital Limited
    Method
    for Enhancing Video Resolution and Video Quality, Encoder and Decoder
    16103565.1
    Granted
    in Hong Kong
    October
    2023A
    Method, Apparatus and Device for Acquiring a Spatial Audio Directional vector
    16103566.0
    Granted
    in Hong Kong
    October
    2023A
    Lens For Extended Light Source and Design Method Therefor
    16106705.5
    Granted
    in HK
    June
    2023Method
    For Improving the Quality Of 2D-to-3D Automatic Conversion By Using Machine Learning
    16111899.1
    Granted
    in HK
    October
    2023Exterior
    design for computer
    CN201630079168.6
    Granted
    in CN
    March
    20261601506.3
    Granted
    in HK
    August
    2041   43     Material
Contracts Related to Intellectual Property and Commercialization Rights License
Agreement with Versitech Limited  In
September 2015, Versitech Limited ("Versitech") and Marvel Digital Limited ("MDL") entered into a License
Agreement in respect to the sharing of income arising from the intellectual property rights in the video encoding and transmission
worldwide. The agreement provides MDL and its affiliates for the term an exclusive and royalty-bearing license under the patent
rights owned by Versitech listed in the previous table on page 52 above, to develop, make, have made, use, sell, offer to sell,
lease, import, export or otherwise dispose of licensed product in 3D video encoding and transmission worldwide and with the right
to grant sublicense pursuant to the terms of the agreement. MDL shall pay an upfront payment in the amount of HK$100,000 and a
running royalties of 3% of net sales on licensed product and licensed process by MDL and its affiliates and sublicensee. MDL shall
also pay Versitech a total of 15% of all sublicense income received by MDL or any of its affiliates. In addition, there are milestone
payments payable to Versitech Limited upon the event when cumulative gross revenue arising from the licensed products reaching
certain levels with the maximum cumulative total milestone payments of HK$2,000,000. This project was originally derived from
an earlier agreement entered into among the Government of the Hong Kong Special Administrative Region, MDL and the University
of Hong Kong ("HKU") under the Innovation and Technology Fund University-Industry Collaboration Programme entitled
"Content Generation and Processing Technologies for 3D/Multiview Images and Videos". Versitech is a wholly-owned subsidiary
and the technology transfer arm of HKU.   Technology
License Agreement with Koninklijke Philips N.V.  In
October 2013, a Technology License Agreement between Koninklijke Philips N.V. ("Philips") and MDL for granting MDL
a non-exclusive and non-transferable license under certain intellectual property rights on/over for licensed patents and knowhow
in relation to the 3D lenticular display design, 3D content creation and 3D formats ("the 3D Technology") to develop,
manufacture, sell and / or otherwise dispose of such 3D display modules and sets, and to disclose and make available certain know-how
and information relating to the 3D technology to MDL. The Agreement shall remain in force for a period of 10 years or until the
last to expire Licensed Patent has expired, whichever is later, unless terminated earlier in accordance with the provisions. The
Technology License Agreement involve 700+ patents owned by Philips. Government
Regulations  The
market for 3D technology is affected by a wide range of U.S. and international regulations, including regulations related to taxation
and import-export controls, which could negatively impact the market for these devices we sell or decrease potential profits to
the Company. Pursuant to the Tariff Act of 1930, as amended, the Trade Act of 1974 and regulations promulgated there under, the
United States government charges tariff duties, excess charges, assessments and penalties on many imports. These regulations are
subject to continuous change and revision by government agencies and by action of the United States Trade Representative and may
have the effect of increasing the cost of goods purchased by the Company or limiting quantities of goods available to the Company
from our overseas suppliers. As some of our products are sold in China, we will need to follow the Regulations of the People's
Republic of China on Import and Export Duties which are amended from time to time and may have the effect of increasing the costs
of goods sold by the Company into China.  Costs
and Effects of Compliance with Environmental Laws; Environmental Matters We
are not aware of any material costs or impacts on our business related to compliance with federal, state or local environmental
laws regarding the products we intend to market and sell. Insurance We
do not carry any kind of product liability or other business insurance. Legal
and Administrative Proceedings We
are not part to any material legal or administrative proceedings, and we are not aware of any threatened material legal or administrative
proceedings against us.   44     C.
    
    Organizational
    Structure As
at December 31, 2017, we have a total of 13 subsidiaries and their corporate details and business activities are listed below:  Subsidiary
    Name
    Place
    of Incorporation
    %
    held
    Business
    scopeCIMC
    Marketing Pty Ltd
    Australia
    100%
    Direct
    Management
    services and tradingBinario
    Ltd
    British
    Virgin Islands
    100%
    Direct
    Investment
    holding companyYamaga
    Ltd
    Hong
    Kong
    100%
    Direct
    Advertising
    and media servicesDragon
    Creative Ltd
    Hong
    Kong
    100%
    Direct
    Sales
    and distribution of various 3D related products and provision of 3D consulting servicesGlobal
    Vantage Audio Ltd
    Hong
    Kong
    50%
    Indirect
    Sale
    and distribution of audio productsGOXD
    Technology Limited
    Hong
    Kong
    100%
    Indirect
    Development
    and distribution of 3D digital picture framesMarvel
    Digital Ltd
    Hong
    Kong
    100%
    Indirect
    Development
    of 3D autostereoscopic display technology and investment holdingVisumotion
    International Ltd
    Hong
    Kong
    100%
    Indirect
    Sale
    of software and provision of consultancy servicesMarvel
    Digital (Shenzhen) Ltd
    China,
    PRC
    100%
    Indirect
    Manufacturing
    and distribution of 3D products and provision of 3D consultancy servicesMarvel
    Software (Shenzhen) Ltd
    China,
    PRC
    100%
    Indirect
    DormantDigital
    Media Technology Ltd
    Labuan,
    Malaysia
    100%
    Indirect
    Sale
    and distribution of 3D and audio productsYamaga
    Audio Limited
    Nevada,
    USA
    100%
    Direct
    Investment
    holding companyZamora
    Corporation
    Nevada,
    USA
    100%
    Direct
    Sales
    and administration office in USA   D.
    
    Property,
    Plant and Equipment The
Company has its registered office in Adelaide, Australia, the principal and main operating office located in Hong Kong, and a
test assembly and operating office in Shenzhen, China. In Australia, the Company rents a 100 square feet office on a month to
month basis at a costs of A$1,000 per month. In Hong Kong, the Company's the principal office is approximately 4,700 square
feet which is currently rent free, and rents the operating office which is approximately 4,000 square feet on a three-year lease
at approximately A$13,400 per month until May 31, 2020. In Shenzhen, the Company rents the operating office which is 3,800 square
feet on a three years' lease at approximately A$6,800 per month until January 31, 2019. The
Company's manufacturing plan is for pre-production or test prosecution. The Company intends to outsource the commercial
production to subcontractors. Accordingly, the Company does not intend to build infrastructure to expand its manufacturing capabilities,
capital equipment, headcount, or administrate burden. We believe we will be able to obtain additional office space for our operations,
as needed, on commercially reasonable terms. Our plant and equipment recorded in our financial statements as at December 31, 2017
consisted of A$205,584 for leasehold improvements relating to renovation and decoration costs for our offices and A$304,393 for
Office Furniture and Equipment. We are not aware of any environmental impact on the use of these fixed assets. With adequate funds
raised in the capital market, we may consider to invest in advance manufacturing facility on the most critical production process
of our ASD products.  ITEM 4A.
    
    UNRESOLVED
    STAFF COMMENTS None.   45     ITEM 5.
    
    OPERATING
    AND FINANCIAL REVIEW AND PROSPECTS  The
following discussion and analysis of the financial condition and results of operations of IMT should be read in conjunction with
the audited financial statements as at and for the fiscal year ended December 31, 2017, as at and for the year ended December
31, 2016, and as at and for the year ended December 31 2015, together with the notes thereto included elsewhere in this Annual
report. The financial information contained in this Annual report is derived from the financial statement, which were prepared
in accordance with IFRS.  A.
    
    Operating
    Results IMT
is an Australian company engaged in the development, sale and distribution of autostereoscopic 3D display, 3D video wall, 3D conversion
equipment and software, and provision of 3D technology solutions and consultancy services, and (b) sale and distribution of audio
products. We
were incorporated under the laws of the Commonwealth of Australia on August 8, 2008 under the name "China Integrated
Media Corporation Limited". On October 12, 2016 we changed the company name to Integrated Media Technology Limited. The
principal listing of our ordinary shares is on the Australian Securities Exchange, or ASX. On
May 2, 2017, we effected a 1-for-30 reverse split of our common stock. The purpose of the reverse stock split was to enable us
to meet the Nasdaq's minimum share price requirement. The reverse stock split became effective and the common stock began
trading on a split-adjusted basis on the Australian Securities Exchange at the opening of trading on May 8, 2017. All share and
per share amounts disclosed herein give effect to this reverse stock split retroactively, for all periods presented. On
August 3, 2017 our shares of Common Stock were admitted for listing on the Nasdaq Capital Markets under the symbol "IMTE". For
a description of the milestones that we have achieved since inception and through to the date of this report, see "Item
4. Information on the Company – A. History and Development of the Company." Overview We
are at an early stage in the development of our 3D products and services and audio products. We have incurred net losses since
inception until recently when we recorded a profit for the fiscal year 2015 mainly through the sale of our autostereoscopic 3D
display, 3D conversion equipment and software. In 2017 we recorded profits of A$1,692,666. Going forward in order to maintain
the profitability, the Company needs to continue to develop and sell the 3D products and services. To date, we have funded our
operations primarily through the sale of equity securities, advances from shareholder and from operation profits. For details
of the business overview, see "Item 4. Information on the Company – B. Business Overview." Critical
Accounting Policies We
prepare our financial statements in accordance with IFRS as issued by IASB. As such, we are required to make certain estimates,
judgments, and assumptions that management believes are reasonable based upon the information available. These estimates, judgments
and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the periods presented. The significant accounting policies listed in Note 3 to the consolidated
financial statements that management believes are the most critical to aid in fully understanding and evaluating our financial
condition and results of operations under IFRS are discussed below.  Inventories Finished
goods are stated at the lower of cost and net realizable value on a 'first in first out' basis. Cost comprises direct materials
and delivery costs, import duties and other taxes. Costs of purchased inventories are determined after deducting rebates and discounts
received or receivable. Net realizable value is the estimated selling price in the ordinary course of business less the estimated
costs necessary to make the sale.  Impairment
of Assets At
each reporting date, the Group reviews the carrying values of its tangible and intangible assets to determine whether there is
any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the assets, being
the higher of the asset's fair value less costs to sell and value in use, is compared to the asset's carrying value.
Any excess of the asset's carrying value over its recoverable amount is expensed in profit or loss. Impairment
testing is performed annually for goodwill and intangible assets with indefinite lives. Where
it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the
cash-generating unit to which the asset belong.  46     Goodwill Goodwill
and goodwill on consolidation are initially recorded at the amount by which the purchase price for a business or for an ownership
interest in a subsidiary exceeds the fair value attributed to the identifiable net assets at acquisition date. Goodwill is tested
annually for impairment and carried at cost less accumulated impairment losses.  Intangible
Assets   (i)
    
    Acquired both separately
    and from a business combination Purchased
intangible assets are initially measured at cost. The cost of an intangible asset acquired in a business combination is its fair
value as at the date of acquisition. Following initial recognition, intangible assets are measured at cost less any accumulated
amortization and any accumulated impairment losses. Intangible assets with finite lives are amortized over the useful life and
assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and
the amortization method for an intangible asset with a finite useful life are reviewed at each financial year end. Intangible
assets, excluding development costs, created within the business are not capitalized and expenditure is charged against profits
in the period in which the expenditure is incurred.   (ii)
    
    Autostereoscopic 3D display
    technologies and knowhow The
autostereoscopic 3D display technologies and knowhow acquired in the business combination is measured at fair value as at the
date of acquisition. These costs are amortized over the estimated useful life of 8 years and are tested for impairment where an
indicator of impairment exists. The useful lives are also examined on an annual basis and adjustments, where applicable, are made
on a prospective basis.   (iii)
    
    Research and development
    costs An
intangible asset arising from development expenditure on an internal technology project is recognized only when the Group can
demonstrate the technical feasibility of completing the intangible asset or technology so that it will be available for application
in existing or new products or for sale, its intention to complete and its ability to use or sell the asset, how the asset will
generate future economic benefits, the availability of resources to complete the development, the ability to measure reliably
the expenditure attributable to the intangible asset during its development and the ability to use the tangible asset generated.
For labor costs, all research and development member salaries that are directly attributable to the technology project are capitalized.
Administrative staff and costs are recognized in the profit or loss instead of capitalizing this portion of costs. Following the
initial recognition of the development expenditure, the cost model is applied requiring the asset to be carried at cost less any
accumulated impairment losses. The amortization rate of these intangible assets was determined on the basis of the estimated useful
life from the time that the relevant asset is taken into use.   (iv)
    
    Intellectual property Expenditure
incurred on patents, trademarks or licenses are capitalized from the date of application. They have a definite useful life and
are carried at cost less accumulated amortization. They are amortized, using the straight line method over their estimated useful
lives for a period of 8 to 15 years.   (v)
    
    Computer software Acquired
computer software licenses are capitalized on the basis of the costs incurred to acquire and bring to use the specific software.
These costs are amortized over their estimated useful lives (2-5 years). Costs associated with maintaining computer software programmes
are recognized as an expense when incurred.   47     Plant
and Equipment Items
of plant and equipment are measured at cost less accumulated depreciation and impairment losses. The
carrying amount of plant and equipment is reviewed annually by the directors to ensure it is not in excess of the recoverable
amount from those assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received
from the asset's employment and subsequent disposal. The expected net cash flows have been discounted to their present values
in determining recoverable amounts. The
depreciable amount of all fixed assets are depreciated over their estimated useful lives to the Group commencing from the time
the assets is held ready for use. Depreciation
is calculated on a straight-line basis to write the net cost of each item of plant and equipment over their expected useful lives.
The depreciation rates used for each class of depreciable assets are generally as follows:   Class
of fixed assets
    
    Depreciation
rateLeasehold Improvements
    
    3-5 yearsOffice Furniture and Equipment
    
    3-5 yearsMotor Vehicle
    
    5 years  Gains
and losses on disposal are determined by deducting the net book value of the assets from the proceeds of sale and are booked to
the statement of comprehensive income in the year of disposal.  Revenue Revenue
comprises the fair value for the sale of goods and services, excluding goods and services tax, rebates and discounts. The Company
recognizes revenue when the amount of revenue can be reliably measured when it is probable that future economic benefits will
flow to the entity and when specific criteria have been met for each of the company's activities. Sale
of Goods Revenue
from sale of 3D autostereoscopic displays, conversion equipment, software, technology solutions and related 3D products is recognized
when the significant risks and rewards of ownership have passed to the buyer and can be reliably measured. Risks and rewards are
considered passed to the buyer when goods have been delivered to the customer. For the products which are technically innovative,
highly customized or require complex installation, revenue is recognized when the customer has completed its acceptance procedures. Sale
of Services Sales
of services are recognized in the accounting period in which the services are rendered by reference to completion of the specific
transaction assessed on the basis of the actual service provided as proportion of the total services to be provided. Consultancy
Services Revenue
from provision of consultancy services is recognized when the respective service is rendered. Interest
Income Revenue
is recognized as interest accrues using the effective interest method.   48     Recent
Acquisitions  See
"Item 4. Information on the Company - A. History and Development of the Company."  Results
of Operations  The
following table sets forth our condensed consolidated statements of operations by amount and as a percentage of our total operating
revenues for the periods indicated:  For
    the years ended December 31,2017
    
    2016
    
    2015Amount
        A$
    
    %
    of NetRevenues
    
    Amount
        A$
    
    %
    of NetRevenues
    
    Amount
        A$
    
    %
    of NetRevenuesRevenues:Products
    
    5,600,106
    
    97.2
    
    13,923,337
    
    100.0
    
    6,269,730
    
    98.3Services
    
    162,605
    
    2.8
    
    6,333
    
    0.0
    
    109,306
    
    1.7Total
    operating revenues
    
    5,762,711
    
    100.0
    
    13,929,670
    
    100.0
    
    6,379,036
    
    100.0ExpensesCost
    of sales
    
    2,548,064
    
    44.2
    
    2,027,743
    
    14.6
    
    2,984,291
    
    46.8Employee
    benefit expenses
    
    1,887,692
    
    32.8
    
    1,715,687
    
    12.3
    
    981,621
    
    15.4Depreciation
    and amortization expenses
    
    2,021,131
    
    35.1
    
    2,147,231
    
    15.4
    
    383,635
    
    6.0Professional
    and consulting expenses
    
    301,732
    
    5.2
    
    300,576
    
    2.2
    
    391,444
    
    6.1Loss
    on disposal of a subsidiary
    
    -
    
    0.0
    
    872
    
    0.0
    
    -
    
    0.0Travel
    and accommodation expenses
    
    333,503
    
    5.8
    
    431,282
    
    3.1
    
    59,499
    
    0.9Other
    operating expenses
    
    1,448,960
    
    25.1
    
    1,728,184
    
    12.4
    
    506,245
    
    8.0Financial
    costs
    
    107,101
    
    1.9
    
    73,666
    
    0.5
    
    -
    
    0.0Total
    expenses
    
    8,648,183
    
    150.1
    
    8,425,241
    
    60.5
    
    5,306,735
    
    83.2Operating
    (loss) / profit before income tax
    
    (2,885,472)
    
    (50.1)
    
    5,504,429
    
    39.5
    
    1,072,301
    
    16.8Non-operating
    incomeInterest
    income
    
    3,092
    
    0.1
    
    2,027
    
    0.0
    
    389
    
    0.0Gain
    on disposal of financial assets at fair value through profit or loss
    
    -
    
    0.0
    
    -
    
    0.0
    
    507,694
    
    8.0Fair
    value change in contingent consideration liability
    
    3,953,537
    
    68.6
    
    -
    
    0.0
    
    -
    
    0.0Other
    income
    
    434,296
    
    7.5
    
    107,551
    
    0.8
    
    419,580
    
    6.5Net
    profit before income taxes
    
    1,505,453
    
    26.1
    
    5,614,007
    
    40.3
    
    1,999,964
    
    31.3Income
    tax credit / (expense)
    
    187,213
    
    3.2
    
    (2,018,939)
    
    (14.5)
    
    356,158
    
    5.6Net
    profit
    
    1,692,666
    
    29.3
    
    3,595,068
    
    25.8
    
    2,356,122
    
    36.9   49     Comparison
of Year Ended December 31, 2017 to Year Ended December 31, 2016  Revenue The
following table sets forth revenues by sources and the percentage of our total operating revenues for the period indicated:  For
    the years ended December 31,2017
    
    2016AmountA$
    
    %
    ofTotalRevenues
    
    AmountA$
    
    %
    ofTotalRevenuesProductsDisplays
    2,528,885
    
    43.9
    
    1,252,424
    
    9.0Tablets
    and mobiles
    655,076
    
    11.4
    
    175,021
    
    1.3Super
    workstations
    1,085,416
    
    18.8
    
    3,273,438
    
    23.5Software
    9,383
    
    0.2
    
    693,280
    
    5.0Technology
    solutions
    1,171,108
    
    20.3
    
    8,392,512
    
    60.2Audio
    products
    54,251
    
    0.9
    
    111,045
    
    0.8Other
    products
    95,987
    
    1.7
    
    25,617
    
    0.2Subtotal
    5,600,106
    
    97.2
    
    13,923,337
    
    100.0ServicesConversion
    services
    79,599
    
    1.4
    
    6,126
    
    0.0Other
    services
    83,006
    
    1.4
    
    -
    
    0.0Consulting
    services income
    -
    
    0.0
    
    207
    
    0.0Subtotal
    162,605
    
    2.8
    
    6,333
    
    0.0Total
    operating revenues
    5,762,711
    
    100.0
    
    13,929,670
    
    100.0 Revenues.The revenue from operating activities for the year ended December 31, 2017 was A$5,762,711 as compared to the prior year of
A$13,929,670, a decrease of A$8,166,959 or 59% from the prior year. The revenue for the year ended December 31, 2017 consists
of the sales and distribution of 3D autostereoscopic products and conversion equipment, sales of software and technology solutions,
sales and distribution of audio products, and provision of conversion and other services. The significant decrease in revenue
from operations in the year ended December 31, 2017 is primarily attributable to the one-off sales of our software and technology
solutions amounting to approximately A$8,390,000 in 2016. Cost
of Sales. The following table sets forth cost of sales by sources of revenues by amount and as a percentage of net revenues
for the periods indicated:  Years
    ended December 31,2017
    
    2016AmountA$
    
    %
    of NetRevenues
    
    AmountA$
    
    %
    of NetRevenuesProducts
    2,468,763
    
    42.8
    
    2,024,067
    
    14.6Services
    79,301
    
    1.4
    
    3,676
    
    0.0Total
    cost of sales
    2,548,064
    
    44.2
    
    2,027,743
    
    14.6  Cost
of sales increased by 26% to A$2,548,064 in 2017 from A$2,027,743 in 2016, which primarily due to the change in product mix of
the Group with more software products and technology solutions being sold with less cost of sales than that of the products sold
in the current year. Gross
Profit and Gross Margin. Gross profit decreased by 73% from A$11,901,927 in 2016 to A$3,214,647 in 2017. Our gross margin
significantly decreased from 85% in 2016 to 56% in 2017, primarily due to the change in product mix of the Group with more software
products and technology solutions being sold with comparatively higher profit margin than that of the products sold in the current
year.  Fair
value change in contingent consideration liability  It represented the fair value decrease in contingent consideration liability in relation to the acquisition of Marvel Digital
Limited ("MDL") from Marvel Finance Limited ("MFL"). In accordance to the terms of MDL acquisition, the Company was to pay
a deferred consideration calculated at 5 times of the 2 year average of the consolidated profits of MDL from the completion
date less the initial consideration. The Group included approximately HK$115,980,000, equivalent to A$20,748,035 as contingent
consideration liability as at 31 December 2016. There was no more contingent liability as at 31 December 2017 as the Company
recognized the actual deferred performance fee paid to MFL of A$15,110,749. This resulted in the write back of liabilities
and a gain on fair value change in contingent consideration liability of A$3,953,537 and an credit to foreign exchange reserve
of A$1,683,749.  Other
income  It
represented primarily the government subsidy in respect of our technology development projects received for the years ended December
31, 2017 and 2016.   Expenses  The
operating expenses for the year ended December 31, 2017 was A$8,648,183 as compared to the prior year of A$8,425,241 an increase
of A$222,942 or 3% from the prior year. The increase in total operating expenses was mainly attributable to the increase of A$172,005
in employee related costs as a result of general salary increment.  Employee
benefit expenses increased by 10% to A$1,887,692 in 2017 from A$1,715,687 in 2016, which was primarily due to general salary increment.
As at December 31, 2017, the Group had a total of 53 staff, compared to 74 staff in the Group as at December 31, 2016. The decrease
of staff was primarily due to restructuring of the Group in late 2017.  The
loss on disposal of subsidiary for the year ended December 31, 2016 is related to the Company's shareholding in Conco International
Co., Limited which was disposed in March 2016.  Income
tax  A
deferred tax benefit of A$187,213 was recognized during the year ended December 31, 2017 which were arising primarily from the
recognition of tax effect of temporary differences. While an income tax expenses of A$2,018,939 consisted of A$1,052,266 and A$966,673
of current tax and deferred tax were recognized during the year ended December 31, 2016 which were arising primarily from the
increase of taxable profit and the recognition of tax effect of temporary differences.  Net
Profit  We
recorded a net profit of A$1,692,666 and A$3,595,068 for the years ended December 31, 2017 and 2016 respectively. The decrease
was mainly due to the decrease in our revenue from operating activities and increase in corporate expenses for setting up a new
business stream. Included in the profit for the year ended 31 December 2017 was an amount of A$3,953,537 being the fair value decrease
in contingent consideration liability in relation to the acquisition of MDL.   50     Comparison
of Year Ended December 31, 2016 to Year Ended December 31, 2015  Revenue The
following table sets forth revenues by sources and the percentage of our total operating revenues for the period indicated:  For
    the years ended December 31,2016
    
    2015AmountA$
    
    %
    ofTotalRevenues
    
    AmountA$
    
    %
    ofTotalRevenuesProductsDisplays
    1,252,424
    
    9.0
    
    593,836
    
    9.3Tablets
    and mobiles
    175,021
    
    1.3
    
    268,211
    
    4.2Super
    workstations
    3,273,438
    
    23.5
    
    3,363,078
    
    52.8Software
    693,280
    
    5.0
    
    -
    
    0.0Technology
    solutions
    8,392,512
    
    60.2
    
    -
    
    0.0Audio
    products
    111,045
    
    0.8
    
    1,838,663
    
    28.8Other
    products
    25,617
    
    0.2
    
    205,942
    
    3.2Subtotal
    13,923,337
    
    100.0
    
    6,269,730
    
    98.3ServicesConversion
    services
    6,126
    
    0.0
    
    44,046
    
    0.7Other
    services
    -
    
    0.0
    
    -
    
    0.0Consulting
    services income
    207
    
    0.0
    
    65,260
    
    1.0Subtotal
    6,333
    
    0.0
    
    109,306
    
    1.7Total
    operating revenues
    13,929,670
    
    100.0
    
    6,379,036
    
    100.0 Revenues. The revenue from operating activities for the year ended December 31, 2016 was A$13,929,670 as compared to the prior
year of A$6,379,036, an increase of A$7,550,634 or 118% from the prior year. The revenue for the year ended December 31, 2016
consists of the sales and distribution of 3D autostereoscopic products and conversion equipment, sales of software and technology
solutions, sales and distribution of audio products, provision of consultancy services while in the prior year the sales were
mainly sales and distribution of 3D autostereoscopic products and conversion equipment. The significant increase in revenue from
operations in the year ended December 31, 2016 is primarily attributable to sales of Marvel 3DPro Super Workstations, software
and technology solutions which were new businesses and product lines introduced in late 2015. The revenue from operating activities
in the second half of 2016 amounted to A$7,745,289, as compared to the first half of 2016 of A$6,184,381. The revenue continued
to grow which is attributable to the growth in the demand and applications for 3D autostereoscopic products, and its related software
and technology solutions.  Cost
of Sales . The following table sets forth cost of sales by sources of revenues by amount and as a percentage of net revenues
for the periods indicated:  Years
    ended December 31,2016
    
    2015AmountA$
    
    %
    of NetRevenues
    
    AmountA$
    
    %
    of NetRevenuesProducts
    2,024,067
    
    14.6
    
    2,978,224
    
    46.7Services
    3,676
    
    0.0
    
    6,067
    
    0.1Total
    cost of sales
    2,027,743
    
    14.6
    
    2,984,291
    
    46.8  Cost
of sales decreased by 32% to A$2,027,743 in 2016 from A$2,984,291 in 2015, which primarily due to the change in product mix of
the Group with more software products and technology solutions being sold with less cost of sales than that of the products sold
in the prior year.  Gross
Profit and Gross Margin . Gross profit increased by 251% from A$3,394,745 in 2015 to A$11,901,927 in 2016. Our gross margin
significantly increased from 53% in 2015 to 85% in 2016, primarily due to the change in product mix of the Group with more software
products and technology solutions being sold with comparatively higher profit margin than that of the products sold in the prior
year.   Gain
on disposal of financial assets at fair value  The
gain on disposal of financial assets of A$507,694 for the year ended December 31, 2015 represented the sales of our investment
in the ordinary shares of a company quoted on the OTC Market in the United States.  Other
income  It
represented primarily the government subsidy in respect of our technology development projects received for the year ended December
31, 2016. While it represented mainly the design service income of the audio products in our audio division for the year ended
December 31, 2015.   Expenses  The
operating expenses for the year ended December 31, 2016 was A$8,425,241 as compared to the prior year of A$5,306,735 an increase
of A$3,118,506 or 59% from the prior year. The increase in total operating expenses was mainly attributable to (i) the increase
of A$734,066 in employee related costs as a result of the additional staffing through the acquisition of 3D technology businesses
in late 2015, and (ii) the aggregate increase of about A$3,357,000 in general administration expenses of depreciation and amortization
expenses, travel and accommodation expenses and other expenses due to the increase in operating activities as a result of acquisition
of 3D technology businesses in 2015. In 2016, the other operating expenses included primarily rental expenses of A$370,423, communication
and telephone of A$81,297, exhibition and marketing expenses of A$257,012, exchange loss of A$100,950 and administration and office
expenses of A$872,270. In 2015, the other operating expenses included primarily rental expenses of A$155,365, communication and
telephone of A$25,603, exhibition and marketing expenses of A$38,690, exchange loss of A$16,621 and administration and office
expenses of $196,298. These expenses significantly increased to A$1,728,184 for the year ended December 31, 2016 as compared to
the prior year of A$506,245 was primarily due to the inclusion of full year expenses incurred in MDL in 2016 compared to only
three months in prior year.  Employee
benefit expenses increased significantly by 75% to A$1,715,687 in 2016 from A$981,621 in 2015, which was primarily due to the
additional staffing through the acquisition of 3D technology businesses in late 2015. As at December 31, 2016, the Group had a
total of 74 staff, compared to 44 staff in the Group as at December 31, 2015.  The
loss on disposal of subsidiary for the year ended December 31, 2016 is related to the Company's shareholding in Conco International
Co., Limited which was disposed in March 2016.  Income
tax  An
income tax expenses of A$2,018,939 consisted of A$1,052,266 and A$966,673 of current tax and deferred tax were recognized during
the year ended December 31, 2016 which were arising primarily from the increase of taxable profit and the recognition of tax effect
of temporary differences. While the income tax credit of A$356,158 was recognized during the year ended December 31, 2015 which
was arising primarily from the recognition of tax effect of previously unrecognized tax losses and temporary differences.  Net
Profit  We
recorded a net profit of A$$3,595,068 and A$2,356,122 for the years ended December 31, 2016 and 2015 respectively. This increase
in net profit from the prior year was mainly due to the sale of our 3D conversion equipment, software and technology solutions
which were new businesses and product lines introduced in late 2015.   51     Inflation
and Seasonality Management
believes inflation has not had a material impact on our operations or financial condition and that our operations are not currently
subject to seasonal influences. Recently
Issued International Accounting Standards and Pronouncements Our
consolidated financial statements comply with Australian accounting standards which ensure that they also comply with International
Financial Reporting Standards. Certain
new Australian accounting standards and interpretations have been published that are not mandatory for December 31, 2017
reporting period. New
Accounting Standards and Interpretations Not Yet Mandatory or Early Adopted  A
number of new standards, amendments to standards and interpretations issued by the IASB which are not yet mandatorily application
to the Group have not been applied in preparing these consolidated financial statements. Those which may be relevant to the Group
are set out as below. The Group does not plan to adopt these standards early.  •  
IFRS 9 Financial Instruments and associated Amending Standards (applicable to annual reporting period commencing January 1, 2018).  The
Standard will be applicable retrospectively (subject to the comment on hedge accounting below) and includes revised requirements
for the classification and measurement of financial instruments, revised recognition and derecognition requirements for financial
instruments and simplified requirements for hedge accounting.  Key
changes made to this standard that may affect the Group on initial application include certain simplifications to the classification
of financial assets, simplifications to the accounting of embedded derivatives, and the irrecoverable election to recognize gains
and losses on investments in equity instruments that are not held for trading in other comprehensive income.  Although
the Directors anticipate that the adoption of IFRS 9 may have an impact on the Group's financial instruments it is impractical
at the stage to provide a reasonable estimate of such impact.   52     B.
    
    Liquidity
    and Capital Resources Since
our inception, our operations have mainly been financed through the issuance of equity securities. Additional funding has come
through shareholder advances and short term investments. We have incurred significant losses since our inception until 2015. We
recorded profit of A$1,692,666, profit of A$3,595,068, and profit of A$2,356,122 for the fiscal years ended December 31, 2017,
2016 and 2015 respectively. Equity
Issuances The
following table summarizes our issuance of ordinary shares for cash. We did not issue shares for share-based payments, executive
and employee compensation in the last 3 fiscal years.  FiscalYear
    
    
    Number
    ofShares*
    
    
    Net
    Proceeds(in A$)Issuance
    of new shares
    
    
    2013
    
    
    
    580,000
    
    
    
    3,480,000Share
    issuance in respect of payment to a consultant
    
    
    2013
    
    
    
    16,666
    
    
    
    100,000Share
    issuance in respect of acquisition of subsidiaries
    
    
    2015
    
    
    
    879,633
    
    
    
    5,277,804 *
On post reverse split of 30 for 1 Capital
Requirements As
of December 31, 2017, we had cash and cash equivalents of A$2,070,072 and trade receivables of A$2,489,235. Our trade receivable
balance significantly decreased as compared to A$8,612,576 as of December 31, 2016, was attributable to receipts from customers
on sale of software and technology solutions during the year ended December 31, 2016. The decrease in trade receivables will not
affect our cashflows since we have adequate cash reserve, bank facilities and cashflows generated from our operations to finance
our ongoing operations. In January 2018, a Group company issued a HK$23 million (or about A$3.8 million) convertible bonds to
fund the development of the 3D business. We anticipate that our current cash and cash equivalents will be sufficient to fund our
operations for the next 12 months based on our budget and forecasted revenue. However, our forecast of the period of time through
which our financial resources will be adequate to support our operations is a forward looking statement that involves risks and
uncertainties, and actual results could vary materially. If we are unable to raise additional capital when required or on acceptable
terms or not realize our anticipated operating and sales plans, we may have to significantly delay, scale back or discontinue
our 3D developments or our operations. We
anticipate that we will require substantial funding of A$5 Million in order to achieve our long-term goals and complete the research
and development of our current 3D products. We expect to generate revenue from our current lineup of 3D products and services,
and audio products but we cannot forecast the level of revenue in the coming year and we are not certain of our results, either
profit or loss. Accordingly, our future capital requirements are difficult to forecast and will depend on many factors, including:  •
    
    the
    costs of establishing sales, marketing and distribution capabilities;  •
    
    the
    scope, results and timing of our new products;  •
    
    the
    revenue generated for the 3D products and services, and the audio products; and  •
    
    the
    cost of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights.  In
additional to the funding required for the research and development of our 3D products, we also have funding requirements to pay
for the performance fee in respect of the acquisition of MDL. As at December 31 2017, the performance fee to be paid is about
A$15 million based on the discounted cash flow valuation method. The Company will prepare to raise the capital of such funding
requirements through the capital or equity markets, in particular we will look at private equity to capitalize on our technologies
through our subsidiaries. We may also consider to raise additional funds from the capital markets in Australia or USA where our
common stocks are traded.   53     Cash
Flows The
following table summarizes our cash flows for the periods presented:  Fiscal
    Year Ended December 31,2017
    
    2016
    
    2015A$
    
    A$
    
    A$Net
    cash inflows / (outflows) in operating activities
    
    4,864,308
    
    (1,209,052)
    
    2,877,195Net
    cash (outflows) / inflows in investing activities
    
    (2,189,991)
    
    (4,045,261)
    
    1,732,593Net
    cash outflows by financing activities
    
    (1,579,552)
    
    (444,707)
    
    (90,464)Net
    increase / (decrease) in cash and cash equivalents
    
    1,094,765
    
    (5,699,020)
    
    4,519,324Effect
    of exchange rate changes on cash and cash equivalents
    
    (61,658)
    
    (147,211)
    
    136,157Cash
    and cash equivalents at beginning of period
    
    1,036,965
    
    6,883,196
    
    2,227,715Cash
    and cash equivalents at end of period
    
    2,070,072
    
    1,036,965
    
    6,883,196  Net
cash inflows / (outflows) in operating activities was A$4,864,308, A$(1,209,052) and A$2,877,195 during the years ended December
31, 2017, 2016 and 2015, respectively. Net cash inflows in operating activities significantly increased during the year ended
December 31, 2017 were attributable to the receipts from customers on sale of software and technology solutions. Net cash outflows
in operating activities increased during the year ended December 31, 2016 were attributable to the expanding business operations
and payments for trade deposits and various business projects. Net
cash (outflows) / inflows in investing activities was A$(2,189,991), A$(4,045,261) and A$1,732,593 during the years ended December
31, 2017, 2016 and 2015, respectively. Net cash outflows in investing activities during the years ended December 31, 2017 and
2016 was primarily attributable to the payments for acquisition of various patents and intangible assets, and development costs
incurred for various on-going technology projects. Net
cash outflows in financing activities was A$1,579,552, A$444,707 and A$90,464 during the years ended December 31, 2017, 2016 and
2015, respectively. Net cash outflows in financing activities during the years ended December 31, 2017 and 2016 are attributable
to the repayment of advances to related parties and bank borrowings. We
had cash and cash equivalents of A$2,070,072, A$1,036,965 and A$6,883,196 as at December 31, 2017, 2016 and 2015 respectively.
Cash and cash equivalents as at December 31, 2017 and 2016 was consisted of A$2,860,014 and A$1,820,994 of cash and bank balances,
and A$(789,942) and A$(784,029) of bank overdraft, respectively.  C.
    
    Research
    and Development, Patents and Licenses In
2015, after the acquisition of the ASD technology business in September 2015, we employed 11 staff in the research and development
of 3D autostereoscopic technology and we incur staffing costs of approximately A$228,000. As at December 31, 2016 we have 19 staff
and incurred staffing costs of approximately A$926,000 during the year. As at December 31, 2017 we had 10 staff and incurred staffing
costs of approximately A$764,000 during the year. We also have company sponsored research with certain universities and research
institutes as discussed in Item 4. Information of the Company under Research and Developments, which also includes a cooperation
agreement with the Hong Kong Applied Science and Technology Institute (ASTRI) to establish the ASTRI-Marvel Digital Joint Research
and Development Center, focusing on research and development of advanced technology in 3D imaging, as announced on June 20, 2016.   D.
    
    Trend
    Information We
are still a young company and it is not possible for us to predict with any degree of accuracy the outcome of our business in
the future. Our operations is mainly dependent on further development and commercialization of our technologies.  E.
    
    Off-Balance
    Sheet Arrangements During
fiscal years ended December 31, 2015, 2016 and 2017, we did not have any relationships with unconsolidated entities or financial
partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established
for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.  F.
    
    Tabular
    Disclosure of Contractual Obligations As
of December 31, 2017 our contractual obligations were as set forth below:  Payments
    Due by PeriodTotal
    
    Less than1 year
    
    1-3
    years
    
    3-5
    years
    
    More
    than 5 yearsA$
    
    A$
    
    A$
    
    A$
    
    A$Contractual ObligationsBank Borrowings
    
    819,450
    
    819,450
    
    -
    
    -
    
    -Contractual Commitments
    
    1,925,797
    
    1,925,797
    
    -
    
    -
    
    -Operating Lease Obligations
    
    559,553
    
    273,784
    
    285,769
    
    -
    
    -Total
    
    3,304,800
    
    3,019,031
    
    285,769
    
    -
    
    -   The
Group had internal capital commitments for the investments in two PRC subsidiaries of approximately A$5,045,000.   54     ITEM 6.
    
    DIRECTORS,
    SENIOR MANAGEMENT AND EMPLOYEES  A.
    
    Directors
    and Senior Management The
following table sets forth our directors and senior management, their age and the positions they held as of the date of this annual
report on Form 20-F. All of our directors and senior management may be contacted at our registered office located at Level 7,
420 King William Street, Adelaide, SA 5000, Australia.  Name
    
    
    
    PositionDr.
    Herbert Ying Chiu LEE (2)
    
    
    
    Executive
    Chairman and Chief Executive OfficerMr.
    Wilton Timothy Carr INGRAM (3)
    
    
    
    Independent
    Non-Executive DirectorDr.
    Man-Chung CHAN (1) (4)
    
    
    
    Independent
    Non-Executive DirectorDr.
    Chang Yuen CHAN (1) (2) (5)
    
    
    
    Independent
    Non-Executive DirectorCon
    UNERKOV
    
    
    
    Non-Executive DirectorGeorge
    YATZIS
    
    
    
    Company
    SecretaryAlson
    Shun Wai LAU
    
    
    
    Chief
    Financial ControllerProfessor
    S. C. CHAN (6)
    
    
    
    Technology
    AdvisorPerry
    Chung Ho WONG
    
    
    
    Product
    DirectorWilliam
    King To NG
    
    
    
    R&D
    Project DirectorLu
    Xia
    
    
    
    Audio
    Division President  (1)
    Member of the Audit Committee(2)
    Member of the Nomination and Remuneration Committee(3)
    Chairman of Audit Committee(4)
    Chairman of the Nomination and Remuneration
    Committee(5)
    Chairman of Technology and Innovation Advisory
    Committee(6)
    Member of the Technology and Innovation Advisory
    Committee Dr. Herbert
Ying Chiu LEE ("Dr. Lee"), aged 65, is a seasoned businessman with significant experience in the Hong Kong and
Chinese digital advertising market sector and technology development. Over the past 17 years, Dr. Lee has extensive working experience
in technology management and 3D autostereoscopy. During these years, he has also invested in many technology startups and incubated
them into successful companies.  Dr.
Lee received his Bachelor of Applied Science in civil engineering in 1977 from the University of British Columbia, B.C., Canada.
He obtained his training in structural design in Hong Kong after his graduation. In 1982, he became a member of the Institute
of Structural Engineers (MIStructE.) and subsequently he obtained his Chartered Engineer title from the Engineering Council of
the United Kingdom. In 2004, Dr. Lee finished his Master of Technology Management degree at the Hong Kong University of Science
and Technology. His major study is technology management. After that, he joined Hong Kong Polytechnic University as an engineering
doctoral student conducting research in knowledge management discipline. His major research is organizing information through
his newly developed semantic search engine. In 2011, Dr. Lee had been conferred the degree of Doctor of Engineering. In 2014,
he was appointed as professor for City College of Vocational Technology in Wuxi, China. In the same year, Dr. Lee was elected
by the Council of the Association to be the Senior Fellowship of Asia College of Knowledge Management.  Dr.
Lee was awarded the Scientific and Technological Innovation Awards by China Radio & TV Equipment Association (CRTA) for outstanding
individuals in 2013 and 2016. In 2015, he was awarded Asian Social Caring Leadership Award by Social Enterprise Research Institution.
In the same year, Enterprise Asia conferred the Asia Pacific Entrepreneurship Award to Dr. Lee for his outstanding and exemplary
achievement in entrepreneurship. Dr. Lee is the Honorary Director of Glasses-free 3D Technology Innovation Industry Alliance.
This is the only official organization in China whose functions are to promote and to set the industrial standard for ASD technology.  Dr.
Lee has extensive business experience, academic background and business network including through his work in the community to
lead the Group to new height in the coming future.   55     Mr.
Wilton Timothy Carr INGRAM (Mr. Ingram), aged 71, has operated his own Company since 1975 engaged in various fields, including
corporate advice and marketing in Australia and Hong Kong. In 1998, Mr. Ingram established, with Australian partners, a venture
capital business, Momentum Ventures Funds Limited in Melbourne Australia. The fund invests in companies such as Engenic Pty Ltd
(Bio Technology business), CRX Pty Ltd (Communication technology business), Bentic Limited (Deep Water Drilling Company in the
US and world-wide), and Paniva Pty Ltd (Corporate Education Business world-wide). Since 1990, Mr. Ingram has invested and developed
resorts in the Philippines such as the Friday's Boracay and Oasis Hotel, as well as commercial buildings in Makati, Manila
in partnership with First Pacific Group which is listed in Hong Kong.  Dr.
Man-Chung CHAN ("Dr. MC Chan"), aged 59, graduated from the Chinese University of Hong Kong in 1980 in Philosophy
and Government & Public Administration. He received his PhD in Computer Science from La Trobe University in Australia. From
1988 till 1994, he taught Computer Science at University of New South Wales.  From 1994, he has worked with the Computing
Department of the Hong Kong Polytechnic University. Dr.
MC Chan was a computational logician and lately he worked in the broad field of knowledge management, artificial intelligence
and intellectual property of computing. He founded the Institute of Systems Management in 2003. He has extensive working relationship
with municipal government of Jiangsu, Hubei and Henan provinces in China. Dr. Chang
Yuen CHAN ("Dr. CY Chan"), aged 52, graduated from the University of Hong Kong with a PhD in computer simulation
and holds a LLB from the Manchester Metropolitan University. Dr.
CY Chan is currently employed as a project manager at the Partner State Key Laboratory in Ultra-precision machining Technology
working as one of the key project investigators. His main research interests are in light–field imaging, bionic vision,
nano-machining mechanics, adaptive control and compensation, and the design of lubricating components for ultra-precision machining.
Dr. CY Chan also has expertise in the areas of optical design and computer simulation and is also proficient in software development.
He joins the Board as an advisor in the areas of technology evaluation and strategic decision making. Mr.
Con UNERKOV ("Mr. Unerkov"), aged 49, is an Australian based businessman with local and international experience
in the Finance, Media, Advertising, and Telecommunications markets. Mr. Unerkov holds a Bachelor of Applied Science in Computer
Studies from the University of South Australia and over his career has worked as an executive for a number of companies both in
the private and public sectors where he has gained significant experience in the commercial, financial and business development
aspects of business and has gained transactional experience in mergers and acquisitions. Mr. George
YATZIS ("Mr. Yatzis"), aged 41, has served as our Company Secretary since November 9, 2015. Mr. Yatzis
has worked and held Company Secretary roles in a number of Public Companies listed on the Australian Securities Exchange ("ASX").
He is currently a partner at global accounting firm BDO, working in the Adelaide office. Mr. Yatzis supports the board of
directors in respect to all administrative and compliance matters relating to the Australian Securities Exchange. Mr. Yatzis
has a Bachelor of Commerce from the University of Adelaide. He is also a member of Chartered Accountants Australia and New Zealand
("CAANZ"). Mr. Alson
Shun Wai LAU ("Mr. Lau"), aged 38, joined the Company in August 2014 as Chief Financial Controller. Mr. Lau is
responsible for overseeing the accounting, finance and treasury functions of the Group as well as investor relations. He is a
member of the Hong Kong Institute of Certified Public Accountants and a fellow member of Association of Chartered Certified Accountants.
He holds a Master Degree in Professional Accounting from Hong Kong Polytechnic University and Bachelor Degree in Business Administration
from the Chinese University of Hong Kong. He has about 10 years of experience in auditing gained from two international accounting
firms and has considerable audit, assurance and advisory experience of all sizes from private clients to sizeable listed companies
in Hong Kong, USA and UK with international operations. Mr. Lau was a partner of an international accounting firm in Hong Kong
prior to joining the Company. Professor
S. C. CHAN ("Prof. Chan") received his B.Sc (Eng) and Ph.D degrees from the University of Hong Kong in 1986 and
1992, respectively. He joined City Polytechnic of Hong Kong in 1990 as an assistant lecturer and later as a university lecturer.
Since 1994, he has been with the department of electrical and electronic engineering at the University of Hong Kong, and is now
a professor in this department. He held visiting positions in Microsoft Corporation (Redmond, USA), Microsoft Research Asia, University
of Texas at Arlington, and Nanyang Technological University. Prof.
Chan's main research area is signal processing and applications. His previous research covers fast transform algorithms,
filter design and realization, multirate and array signal processing, adaptive and communications signal processing, data compression
and image-based rendering, high-speed signal converters, biomedical signal processing and bioinformatics. His research sponsors
include the HK Research Grant Council (RGC) and the innovative technology fund (ITF) of HK. Prof.
Chan has served in a number of professional and administrative committees. He is currently a member of the Digital Signal Processing
Technical Committee of the IEEE Circuits and Systems Society, Associate Editors for IEEE Trans. Circuits and Systems I and Journal
of Signal Processing systems, and was the Chairman of the IEEE HK Chapter of Signal Processing. He was the special session chairman
of ICASSP2003 and is an organizing committee member of the IEEE 2010 ICIP. Prof.
Chan has published more than 200 journal and conference articles and is the co-author of a book: Image-Based Rendering by Springer,
2006.   56     Mr.
Perry Chung Ho WONG ("Mr. Wong") joined the Company in June 2016 as Product Director. Mr. Wong is responsible
for advancing the branding and product strategy development, product marketing and product management operations of the Group's
products and services.  Mr. Wong has extensive experience in product branding and development, product and engineering management,
product marketing and sales in respect of the consumer electronic products and accessories.  Mr. Wong got several international
product design awards, such as iF design GOLD award, iF design award, Red dot design award and Hong Kong Award for industries
– Grand Award. Prior to joining the Group, he held various senior positions in companies of consumer electronics and smartphone
accessories industries, and was entrusted with product line management and sales engineering management.  Mr. Wong holds
a bachelor degree in Computer Engineering and a master degree in Electronic Engineering with Business Management. Dr.
William King To NG ("Dr. Ng") has served as our R&D Project Director since April 2013. He has more than
ten years of experience in the 3D photography, auto-stereoscopic display and 3D TVs.  Starting in 2003, Dr. Ng was a postdoctoral
fellow of the Department of Electrical and Electronic Engineering, The University of Hong Kong. His research interests include
visual communication, image-based rendering, and video transmission. He has published more than 30 papers in international journals
and conferences. Dr. Ng has a Doctor of Philosophy degree and a Master of Philosophy degree in the Electrical and Electronic Engineering
from The University of Hong Kong, and a Bachelor of Engineering degree in Computer Engineering from the City University of Hong
Kong. He is also a member of the Institute of Electrical and Electronics Engineers (MIEEE). Ms.
Lu XIA ("Ms. Xia"), aged 31, is the president of Yamaga Limited, our Group company in the wireless audio division.
Ms. Xia is also the President of Zamora Limited, U.S. Sales, corporate services and administration company. Ms. Xia has worked
for the Group since 2013 initially in the display division and then in business development. She is currently in charge of audio
products division for the Group. Ms. Xia has over 5 years of experience working in the audio and display industry, corporate affairs
and general consulting. Ms. Xia has a Master of Science degree from Northeastern University in 2009 and she received her Bachelor
Degree of Arts from Shenzhen University in China in 2007. There
are no orders, judgments, or decrees of any governmental agency or administrator, or of any court of competent jurisdiction, revoking
or suspending for cause any license, permit or other authority to engage in the securities business or in the sale of a particular
security or temporarily or permanently restraining any of our officers or directors from engaging in or continuing any conduct,
practice or employment in connection with the purchase or sale of securities, or convicting such person of any felony or misdemeanor
involving a security, or any aspect of the securities business or of theft or of any felony. Nor are any of the officers or directors
of any corporation or entity affiliated with us so enjoined. There
are no family relationships among any of our officers and directors.   57     B.
    
    Compensation Remuneration
Principles Remuneration
of all executive and non-executive directors and officers is determined by the Nomination and Remuneration Committee. We
are committed to remunerating senior executives and executive directors in a manner that is market-competitive and consistent
with "Best Practice" including the interests of shareholders. Remuneration packages are based on fixed and variable
components, determined by the executives' position, experience and performance, and may be satisfied via cash or equity. Non-executive
directors are remunerated out of the aggregate amount approved by shareholders and at a level that is consistent with industry
standards. Non-executive directors do not receive performance based bonuses and prior shareholder approval is required to participate
in any issue of equity. No retirement benefits are payable other than statutory superannuation, if applicable. Our
remuneration policy is based on our financial performance and on success of our development and commercializing of our technologies
into products or solutions. We
envisage our performance, in terms of earnings, will indicate the success of our research and development. Shareholder wealth
reflects this speculative and volatile market sector for technology companies. The
purpose of a performance bonus is to reward individual performance in line with our objectives. Consequently, performance based
remuneration is paid to an individual where the individual's performance clearly contributes to a successful outcome. This
is regularly measured in respect of performance against key performance indicators. We
use a variety of key performance indicators to determine achievement, depending on the role of the executive being assessed. These
include:  •
    
    Successful
    in achieving sales targets,•
    
    Successful
    contract negotiations,•
    
    Achievement
    of research project milestones within scheduled time and/or budget, and•
    
    Our
    share price reaching a targeted level on the ASX/NASDAQ over a period of time.  Executive
Compensation The
following table sets forth all of the compensation awarded to, earned by or paid to each individual who served as directors in
fiscal 2017.   Short-term
    Benefits
    
    Post
    Employment
    
    Share-based
    
    TotalBenefits
    
    PaymentsSalary &
    
    Other
    
    Super-
    
    Retirement
    
    Shares
    
    OptionsFees
    
    
    
    annulation
    
    BenefitsA$
    
    A$
    
    A$
    
    A$
    
    A$
    
    A$
    
    A$Dr.
    Herbert Ying Chiu Lee
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/AWilton
    Timothy Carr Ingram
    
    30,000
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    30,000Dr.
    Man-Chung Chan
    
    12,000
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    12,000Dr.
    Chang Yuen Chan
    
    12,000
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    12,000Con
    Unerkov
    
    12,000
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    12,000Total
    
    66,000
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    66,000  Service
Agreements All
the directors have formal letters of appointment in place that have been executed which outline their roles and responsibilities.
The agreements with the Company have no fixed term and the directors' position can be terminated with cause without notice,
and subject to the Company's Constitution and the ASX Listing Rules. The letters of appointment executed do not provide
for any termination payment to directors in the event of being terminated or removed from their positions. Our director, Dr. Herbert
Ying Chiu Lee has employment agreement with the Group. The employment can be terminated immediately for serious misconduct, and
for all other cases, a 3-6 months' notice period. Please refer to the executive compensation table for details on director
individual remuneration. Employee
Share Option Plan The
Company currently does not have an Employee Share Option Plan.  Pension
and Retirement Benefits  There
was no amount set aside or accrued by the Group to provide pension, retirement or similar benefits as at December 31, 2017 as
these amounts were expensed and paid as of this date.   58     C.
    
    Board
    Practices Introduction Our
Board of Directors is elected by and accountable to our shareholders. It currently consists of five directors, the executive Chairman
and four non-executive directors. The Chairman of our Board of Directors is responsible for the management of the Board of Directors
and its functions. Election
of Directors Directors
are elected at our annual general meeting of shareholders. Under our Constitution, a director, other than a managing director,
must not hold office for more than three years or beyond the third annual general meeting following his appointment (whichever
is the longer period) without submitting himself for re-election. Our Board of Directors has the power to appoint any person to
be a director, either to fill a vacancy or as an additional director (provided that the total number of directors does not exceed
the maximum allowed by law), and any director so appointed may hold office only until the next annual general meeting when he
or she shall be eligible for election. Corporate
Governance ASX
Corporate Governance Principles In
Australia there are no defined corporate governance structures and practices that must be observed by a company listed on the
ASX. Instead, the ASX Corporate Governance Council has published the ASX Best Practice Guide, which contains what are called the
Recommendations which articulate eight core principles which are intended to provide a reference point for companies about their
corporate governance structures and practices. Under ASX listing Rule 4.10.3, companies are required to provide a statement in
their annual report to shareholders disclosing the extent to which they have followed the Recommendations in the reporting period
and where they have not followed all the Recommendations, identify the Recommendations that have not been followed and the reasons
for not following them. It is not mandatory to follow the Recommendations. We believe we are in material compliance with the ASX
Corporate Governance Principles. Set forth below are the material provisions of the ASX Corporate Governance Principles together
with the reasons, where applicable, for variations therefrom.  1.
    Lay
    solid foundations for management and oversight. Companies should establish and disclose the respective roles and responsibilities
    of board and management.  2.
    Structure
    the Board to add value. Companies should have a board of an effective composition, size, and commitment to adequately
    discharge its responsibilities and duties. During the year ended December 31, 2017, we varied from the Recommendations in
    the following area:  a)
    No
    formal performance evaluation of the Board was conducted for the year ended December 31, 2017 as the Board believes that we
    are not of a size, nor are our financial affairs of such complexity, to warrant such an exercise. The Board recognizes the
    importance of performance evaluations and will continually assess the necessity and timing of future performance evaluation.  3.
    Act
    ethically and responsibly . Companies should actively promote ethical and responsible decision-making.  4.
    Safeguard
    integrity in financial reporting. Companies should have a structure to independently verify and safeguard the integrity
    of their financial reporting.  5.
    Make
    timely and balanced disclosure. Companies should promote timely and balanced disclosure of all material matters concerning
    the compliance.  a)
    Due
    to the size of our company, we do not have written policies designed to ensure compliance with ASX Listing Rule disclosure
    requirements. Our executive officers and members of our Board of Directors are aware of the obligations for continuous disclosure
    under the ASX Listing Rules, and meet on a regular basis to ensure compliance.  6.
    Respect
    the rights of security holders. Companies should respect the rights of shareholders and facilitate the effective exercise
    of those rights.  7.
    Recognize
    and manage risk. Companies should establish a sound system of risk oversight and management and internal control.  8.
    Remunerate
    fairly and responsibly. Companies should ensure that the level and composition of remuneration is sufficient and reasonable
    and that its relationship to performance is clear.   59     Non-Executive
and Independent Directors Australian
law does not require a company to appoint a certain number of independent directors to its board of directors or audit committee.
However, under the ASX Corporate Governance Principles and Recommendations, the ASX recommends, but does not require, that a ASX-listed
company have a majority of independent directors on its board of directors and that the audit committee be comprised of independent
directors, within the meaning of the rules of the ASX. Our Board of Directors currently have five directors, of which four are
non-executive directors within the meaning of the ASX Corporate Governance Principles and Recommendations, and our audit committee
consists of such three non-executive directors. Accordingly, we currently comply with the Recommendations. Under
NASDAQ Marketplace Rules, in general a majority of our Board of Directors must qualify as independent directors within the meaning
of the NASDAQ Marketplace Rules and our audit committee must have at least three members and be comprised only of independent
directors, each of whom satisfies the respective "independence" requirements of NASDAQ and the U.S. Securities and
Exchange Commission. The
Board of Directors does not have regularly scheduled meetings at which only independent directors are present. The Board of Directors
does meet regularly and independent directors are expected to attend all such meetings. Our practices are consistent with the
Recommendations, in that the Recommendations do not provide that independent directors should meet separately from the Board of
Directors. Our
Board of Directors has determined that each of Mr. Wilton Timothy Carr Ingram, Dr. Chang Yuen Chan, and Dr. Man-Chung Chan qualifies
as an independent director under the requirements of the ASX, NASDAQ Marketplace Rules and U.S. Securities and Exchange Commission. Committees
of the Board of Directors Audit
Committee . NASDAQ Marketplace Rules require us to establish an audit committee comprised of at least three members, each
of whom is financially literate and satisfies the respective "independence" requirements of the U.S. Securities and
Exchange Commission and NASDAQ and one of whom has accounting or related financial management expertise at senior levels within
a company. Our
Audit Committee assists our Board of Directors in overseeing the accounting and financial reporting processes of our company and
audits of our financial statements, including the integrity of our financial statements, compliance with legal and regulatory
requirements, our independent public accountants' qualifications and independence, and independent public accountants, and
such other duties as may be directed by our Board of Directors. The Audit Committee is also required to assess risk management. Our
Audit Committee currently consists of three board members, each of whom satisfies the "independence" requirements
of the U.S. Securities and Exchange Commission, NASDAQ Marketplace Rules and ASX Rules. Our Audit Committee is currently composed
of Mr. Wilton Timothy Carr Ingram, Dr. Man-Chung Chan and Dr. Chang Yuen Chan. Mr. Ingram is the chairman of the audit committee.
The audit committee meets at least two times per year. Nomination
and Remuneration Committee. Our Board of Directors has established a Nomination and Remuneration Committee, which is comprised
by majority of independent directors, within the meaning of NASDAQ Marketplace Rules. The Nomination and Remuneration Committee
is responsible for reviewing the salary, incentives and other benefits of our directors, senior executive officers and employees,
and to make recommendations on such matters for approval by our Board of Directors. The Nomination and Remuneration Committee
is also responsible for overseeing and advising our Board of Directors with regard to the adoption of policies that govern our
compensation programs. Dr. Herbert Ying Chiu Lee, Dr. Man-Chung Chan and Dr. Chang Yuen Chan are the current members of the Nomination
and Remuneration Committee, Dr. Man-Chung Chan and Dr. Chang Yuen Chan each qualifies as an "independent director"
within the meaning of NASDAQ Marketplace Rules. Dr. Man-Chung Chan is the chairman of this committee. Technology
and Innovation Advisory Committee. Our Board of Directors has established a Technology Advisory Committee which is comprised
of at least one independent director who has a technology background and other individuals who have experience in the technology
domain. The TIA Committee supports the Board, the Chairman and CEO in the matters of R&D policy, innovation process, innovation
pipeline, intellectual property and personnel decisions where the scientific component is dominant. Dr. Chang Yuen Chan and Professor
S. C. Chang are current members of the TIA Committee. Dr. Chang Yuen Chan is the chairman of this committee.   60     Corporate
Governance Requirements Arising from Our U.S. Listing — the Sarbanes-Oxley Act of 2002, SEC Rules and the Nasdaq Capital
Market Marketplace Rules Our
shares will be quoted on the Nasdaq Capital Market. The Sarbanes-Oxley Act of 2002, as well as related new rules subsequently
implemented by the SEC, require companies which are considered to be foreign private issuers in the U.S, such as us, to comply
with various corporate governance practices. In addition, Nasdaq has made certain changes to its corporate governance requirements
for companies that are listed on the Nasdaq Capital Market. These changes allow us to follow Australian "home country"
corporate governance practices in lieu of the otherwise applicable Nasdaq corporate governance standards, as long as we disclose
each requirement of Rule 5600 that we do not follow and describe the home country practice we follow in lieu of the relevant Nasdaq
corporate governance standards. We intend to take all actions necessary to maintain compliance with applicable corporate governance
requirements of the Sarbanes-Oxley Act of 2002, rules adopted by the SEC and listing standards of Nasdaq. We follow Australian
corporate governance practices in lieu of the corporate governance requirements of the Nasdaq Marketplace Rules in respect of:  •
    
    Nasdaq
    requirement under Rule 5620(c) that a quorum consist of holders of 33 1/3% of the outstanding ordinary shares — The
    ASX Listing Rules do not have an express requirement that each issuer listed on ASX have a quorum of any particular number
    of the outstanding ordinary shares, but instead allow a listed issuer to establish its own quorum requirements. Our quorum
    is currently two persons who are entitled to vote. We believe this quorum requirement is consistent with the requirements
    of the ASX and is appropriate and typical of generally accepted business practices in Australia.  •
    
    The
    Nasdaq requirements under Rules 5605(b)(1) and (2) relating to director independence, including the requirements that
    a majority of the board of directors must be comprised of independent directors and that independent directors must have regularly
    scheduled meetings at which only independent directors are present - The Nasdaq and ASX definitions of what constitute
    an independent director are not identical and the requirements relating to the roles and obligations of independent directors
    are not identical. The ASX, unlike Nasdaq, permits an issuer to establish its own materiality threshold for determining whether
    a transaction between a director and an issuer affects the director's status as independent and it does not require
    that a majority of the issuer's board of directors be independent, as long as the issuer publicly discloses this fact.
    In addition, the ASX does not require that the independent directors have regularly scheduled meeting at which only independent
    directors are present. We believe that our Board composition is consistent with the requirements of the ASX and that it is
    appropriate and typical of generally accepted business practices in Australia.  •
    
    The
    Nasdaq requirements under Rule 5605(c)(1) and (2) relating to the composition of the audit committee and the audit committee
    charter — The Nasdaq and ASX audit committee requirements are not identical. Moreover, differences in the requirements
    of Nasdaq and ASX also arise because of the differences in the definitions of who constitutes an independent director, as
    discussed above. We have an audit committee and audit committee charter that are consistent with the requirements of the ASX
    Listing Rules and which we believe are appropriate and typical of generally accepted business practices in Australia.  •
    
    The
    Nasdaq requirements under Rules 5605(d) that compensation of an issuer's officers must be determined, or recommended
    to the Board for determination, either by a majority of the independent directors, or a compensation committee comprised solely
    of independent directors, and that director nominees must either be selected, or recommended for the Board's selection,
    either by a majority of the independent directors, or a nomination committee comprised solely of independent directors. The
    Nasdaq compensation committee requirements are not identical to the ASX remuneration and nomination committee requirements.
    Issuers listed on the ASX are recommended under applicable listing standards to establish a remuneration committee consisting
    of a majority of independent directors and an independent chairperson, or publicly disclose that it has not done so. We have
    a Nomination and Remuneration Committee that is consistent with the requirements of the ASX and which we believe is appropriate
    and typical of generally accepted business practices in Australia. Directors'
Service Contracts For
details of directors' service contracts providing for benefits upon termination of employment, see "Item 6. Directors,
Senior Management and Employees – B. Compensation – Service Agreements."   61     Indemnification
of Directors and Officers Our
Constitution provides that, we may indemnify a person who is, or has been, an officer of our company, to the full extent permissible
by law, out of our property against any liability incurred by such person as an officer in defending proceedings, whether civil
or criminal, and whatever their outcome. In
addition, our Constitution provides that to the extent permitted by law, we may pay, or agree to pay, a premium in respect of
a contract insuring a person who is or has been an officer of our company or one of our subsidiaries against any liability:  •
    
    incurred
    by the person in his or her capacity as an officer of our company or a subsidiary of our company, and  •
    
    for
    costs and expenses incurred by that person in defending proceedings relating to that person acting as an officer of IMT, whether
    civil or criminal, and whatever their outcome.  We
maintain a directors' and officers' liability insurance policy. We have established a policy for the indemnification
of our directors and officers against certain liabilities incurred as a director or officer, including costs and expenses associated
in successfully defending legal proceedings.  D.
    
    Employees As
of December 31, 2015, we had 44 employees. Of such employees, 1 was employed in administration located in the Australia, 9 employees
in finance, administration and management located in the Hong Kong and 21 employees in operations located in Hong Kong, 6 employees
in finance, administration and management located in the China and 7 employees in operations located in China. As
of December 31, 2016, we had 74 employees. Of such employees, 3 was employed in administration and management located in the Australia,
12 employees in finance, administration and management located in the Hong Kong and 29 employees in operations located in Hong
Kong, 8 employees in finance, administration and management located in the China and 22 employees in operations located in China. As
of December 31, 2017, we had 53 employees. Of such employees, 3 was employed in administration and management located in the Australia,
11 employees in finance, administration and management located in the Hong Kong and 23 employees in operations located in Hong
Kong, 7 employees in finance, administration and management located in the China and 9 employees in operations located in China. Each
of our full-time employees enters into an employment agreement. We also engage part-time employees from time to time. We may only
terminate the employment of any of our employees in accordance with the relevant employee's contract of employment. Our
standard contract of employment for full time and part-time employees provides that we can terminate the employment of an employee
without notice for serious misconduct or with between one to three months' notice without cause (as set out in the relevant
employee's contract of employment). We can terminate the employment of a casual employee without notice. For a summary of
the key terms of employment of each of our senior management, see "Item 6. Directors, Senior Management and Employees –
B. Compensation – Service Agreements."  E.
    
    Share
    Ownership Beneficial
Ownership of Senior Management and Directors The
beneficial ownership of senior management and directors are set out in Item 7 (A).   62     ITEM 7.
    
    MAJOR
    SHAREHOLDERS AND RELATED PARTY TRANSACTIONS  A.
    
    Major
    Shareholders The
following table sets forth information regarding shares of our common stock beneficially owned as of December 31, 2017 by: (i)
each of our directors; (ii) all the directors as a group; and (iii) each person known by us to beneficially own five percent or
more of the outstanding shares of our common stock, on a post-reverse split basis. Name/Address
    (1)
    
    Common
    Stock
    Common
    Stock
    Options Exercisable Within
    60 Days
    Common
    Stock
    Purchase Warrants/ Convertible
    Note
    Exercisable Within
    60 Days
    Total
    Stock
    and
    Stock Based Holdings (1)
    %
        Ownership
        (2)---------------------------
    
    -------------------
    --------------------
    --------------------
    ------------------
    -----------------Dr.
    Herbert Ying Chiu Lee (3) (7)
    
    1,492,912
    -
    -
    1,492,912
    56.48%Wilton
    Timothy Carr Ingram (5)
    
    -
    -
    -
    -
    -Dr.
    Man-Chung Chan (3)
    
    -
    -
    -
    -
    -Dr.
    Chang Yuen Chan (4)
    
    -
    -
    -
    -
    -Con
    Unerkov (5) (6)
    
    -
    -
    -
    -
    -All
    officers and directors as a Group (5 Persons)
    
    1,492,912
    -
    -
    1,492,912
    56.48%Marvel
    Finance Limited (7)
    
    1,492,912
    -
    -
    1,492,912
    56.48% Notes:(1)
    Except
    as otherwise indicated, based on information furnished by the owners, we believe that the beneficial owners listed above have
    sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them, subject to
    community property laws where applicable and to the information contained in the footnotes to this table. Beneficial ownership
    is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities.
    Unless otherwise indicated, the address of the beneficial owner is c/o Integrated Media Technology Limited at 7/F., Siu On
    Center, 188 Lockhart Road, Wanchai, Hong Kong.(2)
    For
    purposes of computing the percentage of outstanding common stocks held by each person or group of persons named above, any
    shares that such person or group has the right to acquire within 60 days are deemed outstanding but are not deemed to be outstanding
    for purposes of computing the percentage ownership of any other person or group. As of the date of the table above, there
    were 2,643,611 outstanding shares of our common stock (79,301,852 before the reverse stock split) and there was no options,
    warrants, and convertible notes outstanding entitling the holders to purchase any shares of our common stock owned by officers
    and/or directors of the Company.(3)
        (4)
        (5)
    A
                    director of the Company as at December 31, 2015.
        Appointed
        as a director of the Company on March 22, 2016.
        Appointed
        as a director of the Company on April 28, 2016.(6)
    The
    person holds less than one percent of the shares in the Company.(7)
    Marvel
    Finance Limited, a company wholly owned and controlled by Dr. Herbert Ying Chiu Lee, was issued with 869,369 shares (26,081,065
    before the reverse stock split) of the Company in respect of the sale of Marvel Digital Limited to the Company on September
    30, 2015 and purchased 345,677 shares (10,370,000 before the reverse stock split) in the Company from Marvel Digital Limited
    and 277,876 shares (8,336,266 before the reverse stock split) in the Company from Dr. Herbert Ying Chiu Lee on the same date.
    After these purchases, Marvel Finance Limited owned 1,492,912 shares (44,787,331 before the reverse stock split) of the Company.  As
of March 19, 2018 we had 893,216 shares of our Common Stock held by 338 shareholders in our share registrar in Australia, the
host county and we had 1,750,395 shares of our Common Stock held by 8 shareholders in our share registrar in USA.  The
Company is not aware that it is directly owned or controlled by another corporation, any foreign government or any other natural
or legal person(s) severally or jointly. The Company is not aware of any arrangement, the operation of which may result in a change
of control of the Company.   63     B.
    
    Related
    Party Transactions  The
following related party transactions, other than employment matters and indemnification agreements between our directors and executive
officers on the one hand and IMT on the other, occurred during the years ended December 31, 2017, 2016 and 2015 which are highlighted
in the consolidated financial statements.  For
the year ended December 31, 2017  During
the year, the Group had the following related party transactions:  a)  Sales of products of A$2,070,866 to relatedparties b)  Purchase of products of A$85,242 from related parties c)  ServicefeespaidofA$16,895toarelatedparty d)  InterestchargedofA$61,066by the ultimate holding company e)  Company secretarial and service fees paid of A$5,250 to related parties  During
the year, the Group incurred expenditure of A$31,538 (excluding GST) to BDO Administration (SA) Pty Ltd in respect to company
secretarial and taxation services. George Yatzis, Company Secretary of IMT is a director of BDO Administration (SA) Pty Ltd.  During
the year ended 31 December 2017, the unsecured bank overdraft and bank borrowings are personally guaranteed by our director, Dr.
Herbert Ying Chiu LEE. No charge has been requested for this guarantee.    C.
    
    Interests
    of Experts and Counsel Not
applicable.   64     ITEM 8.
    
    FINANCIAL
    INFORMATION  A.
    
    Consolidated
    Statements and Other Financial Information Our
audited financial statements for the fiscal year ending December 31, 2017 are included in Item 18 of this annual report on
Form 20-F. Legal
Proceedings We
are not involved in any significant legal, arbitration or governmental proceedings. We are not aware of any pending significant
legal, arbitration or governmental proceedings with respect to IMT. Dividend
Distribution Policy We
have never paid cash dividends to our shareholders. We intend to retain future earnings for use in our business and do not anticipate
paying cash dividends on our ordinary shares in the foreseeable future. Any future dividend policy will be determined by the Board
of Directors and will be based upon various factors, including our results of operations, financial condition, current and anticipated
cash needs, future prospects, contractual restrictions and other factors as the Board of Directors may deem relevant.  B.
    
    Significant
    Changes  On
November 23, 2017, our major shareholder, Marvel Finance Limited, informed the Company that it had entered into a conditional
share swap agreement with Vantage Ultimate Limited, a wholly owned subsidiary of Sharing Economy International Inc. (Nasdaq: SEII)
being 1,348,241 fully paid ordinary shares at a price of US$10.00 per IMT share (valuing the parcel of shares at US$13,482,410).
In consideration for the transfer, Vantage Ultimate Limited shall arrange for SEII to issue and allocate a certain number of its
ordinary voting shares, representing 19.5% of the then issued share capital of SEII, and a 5 year interest free promissory note
with a principal amount of US$11,482,410 to MFL. The agreement is subject to various conditions, including entry into a definitive
agreement satisfactory to the parties and legal and financial due diligence on or before February 28, 2018. On March 1, 2018,
MFL has indicated as the timeline has end on February 2018, the conditional share swap agreement has lapsed pursuant to its terms
therein.  On
January 12, 2018, the Group entered into the following agreements in connection with the issue of a HK$23 million (equivalent
to approximately AU$3.8 million) Convertible Bonds (the "Convertible Bonds"): (i) Subscription Agreement between Marvel
Digital Limited, a wholly-owned subsidiary of the Company (the "Issuer" or "MDL") and an independent third
party entity ("Bondholder") for the Convertible Bonds, (ii) Deed of Guarantee between the Company and the Bondholder
to guarantee the payment obligations under the Convertible Bonds and (iii) Put Option Deed between the Company and the Bondholder
to repurchase any converted MDL Shares as described below. On the same date, pursuant to the Subscription Agreement, the Convertible
Bonds were issued by MDL to the Bondholder as all the terms and conditions in respect of the Subscription of the Convertible Bonds
were complied with and fulfilled.  Pursuant
to the terms of the Convertible Bonds, the Convertible Bonds are convertible in the circumstances set out therein into 75,000
ordinary shares of MDL ("MDL Shares") at a conversion price of HK$306.67 per share, which is equivalent to 20% of
the then enlarged issued share capital of MDL. The Bondholder will have the right to convert the whole of their Convertible Bonds
into ordinary shares of MDL at any time during the period from January 3, 2018 to January 2, 2020. The period may be extended
to a further 12 months subject to the mutual agreement among MDL, Company and Bondholder. Unless previously redeemed or converted,
the Convertible Bonds will be redeemed at 100% of their principal amount on the Maturity Date.  On
March 19, 2018, the Company announced that it had entered into two sale distribution agreements valued at approximately A$14.8
million (RMB76 million) with two independent customers. The agreements relate to sales of autostereoscopic 3D digital video walls
and standalone digital signage.   65     ITEM 9.
    
    THE
    OFFER AND LISTING  A.
    
    Offer
    and Listing Details Australian
Securities Exchange Our
ordinary shares have traded on the ASX since our initial public offering on February 22, 2013. The following table sets forth,
for the periods indicated the five most recent full financial years, the high and low market quotations for our ordinary shares
as quoted on the ASX as adjusted for the 30-for-1 reverse stock split effective May 8, 2017.  Per Ordinary
    Share (A$)High
    
    LowFiscal
        Year Ended December 31,
    
    A$
    
    A$2013
    
    6.00
    
    6.002014
    
    6.00
    
    6.002015
    
    6.00
    
    5.702016
    
    5.70
    
    5.102017
    
    6.80
    
    5.10Fiscal
        Year Ended December 31, 2016:First
    Quarter
    
    5.70
    
    5.70Second
    Quarter
    
    5.70
    
    5.40Third
    Quarter
    
    5.40
    
    5.10Fourth
    Quarter
    
    5.10
    
    5.10Fiscal
    Year Ended December 31, 2017:First
    Quarter
    
    5.10
    
    5.10Second
    Quarter
    
    6.12
    
    5.10Third
    Quarter
    
    6.75
    
    6.00Fourth
    Quarter
    
    6.80
    
    6.50Month
    Ended:July
    2017
    
    6.00
    
    6.00August
    2017
    
    6.27
    
    6.00September
    2017
    
    6.75
    
    6.27October
    2017
    
    6.75
    
    6.75November
    2017
    
    6.80
    
    6.50December
    2017
    
    6.75
    
    6.74January
    2018
    
    6.74
    
    6.74February
    2018
    
    6.74
    
    5.10  Nasdaq
Capital Markets Our
ordinary shares have traded on the Nasdaq Capital Markets since August 4, 2017. The following table sets forth, for the periods
indicated, the high and low market quotations for our ordinary shares as quoted on the Nasdaq since being listed on the Nasdaq
Capital Markets.  Per Ordinary
    Share (US$)High
    
    LowMonth
    
    US$
    
    US$August
    2017
    
    7.20
    
    6.00September
    2017
    
    8.03
    
    7.34October
    2017
    
    7.50
    
    7.12November
    2017
    
    10.00
    
    6.00December
    2017
    
    7.24
    
    5.60January
    2018
    
    6.25
    
    5.04February
    2018
    
    6.00
    
    4.03   B.
    
    Plan
    of Distribution Not
applicable.  C.
    
    Markets Our
ordinary shares are listed and traded on both the Australian Securities Exchange Ltd., or ASX and the NASDAQ Capital Market.  D.
    
    Selling
    Shareholders Not
applicable.  E.
    
    Dilution Not
applicable.  F.
    
    Expenses
    of the Issue Not
applicable.   66     ITEM 10.
    
    ADDITIONAL
    INFORMATION  A.
    
    Share
    Capital As
at the date of this Annual report, there is no concept of authorized share capital and par value for companies incorporated in
Australia. The Company can issue unlimited number of Common Stock without par value. The Company only has one class of Common
Stock. As
at December 31, 2016, we had 2,643,611 Common Stock issued, outstanding and fully paid (79,301,852 before the reverse stock split). On
3 March 2017, the Company announced that the shareholders approved the resolution for share consolidation of the Company's ordinary
shares with a range between one (1) ordinary share for every twenty (20) ordinary shares to one (1) ordinary share for every forty
(40) ordinary shares so as to satisfy the NASDAQ's minimum price per share listing requirement at the Company's Extraordinary
General Meeting held on 2 March 2017. On
May 2, 2017, we effected a 1-for-30 reverse split of our common stock. The reverse stock split became effective and the common
stock began trading on a split-adjusted basis on the Australian Securities Exchange at the opening of trading on May 8, 2017.
All share and per share amounts disclosed herein give effect to this reverse stock split retroactively, for all periods presented.  As
at December 31, 2017, we had 2,643,611 Common Stock issued, outstanding and fully paid.  Common
Stock Each
Common Stock entitles the holder thereof to one vote at any meeting of IMT's shareholders. The holder of Common Shares are
entitled to receive if, as and when declared by the Board, dividends in such amount as shall be determined by the Board. The holders
of Common Shares have the right to receive the Company's remaining property in the event of a liquidation, dissolution or
winding up, whether voluntary or involuntary.  Options The
Company has no share options outstanding at the date of this Annual report.   B.
    
    Memorandum
    and Articles of Association  Incorporated
by reference to our registration statement on Form 20-F filed on July 21, 2017.    67     C.
    
    Material
    Contracts Except
for contracts entered into in the ordinary course of business, the only contracts entered into by IMT within two years immediately
preceding this Annual report that are still in effect, which may be regarded as material are as follows:    Material
    Contracts
    Major
    Terms and Consideration1
    Agreement
    for Sale and Purchase of 100% of the Issued Shares of Marvel Digital Limited on May 14, 2015
    The
    Company is required to pay an initial consideration of AU$5,216,213 settled by the issue of 26,081,065 shares of the Company
    at AU$0.2 each with a deferred performance fee at five times of the average annualized consolidated profits of the acquiree
    for the two years' period from the completion date less the initial purchase consideration.2
    Patent
    License Agreement with Versitech Limited on September 14, 2015
    The
    Company is required to pay an upfront patent license payment of HK$100,000 plus royalty payment of 3% of net sales of licensed
    products and process, Upfront patent license payment of HK$100,000 plus royalty payment of 3% of net sales of licensed products
    and process, and sharing of 15% of all sublicense income received by the Company.3
    Master
    Agreement for Sales of Glasses Free 3D Panels with a customer on February 26, 2016
    The
    total amount of the Sales Agreement payable by the customer is RMB30,000,000 excluding applicable VAT or sales tax.4
    Sales
    Agreement for Content Management System with a customer on February 26, 2016
    The
    total amount of the Sales Agreement payable by the customer is HK$8,300,0005
    Agreement
    with the Government of the Hong Kong Special Administrative Region and the University of Hong Kong on Development Project
    – "Auxiliary Data Compression and View Synthesis Technologies for 3D/Multiview Videos" on March 14, 2016
    Estimated
    costs of the Project are approximately HK$5,030,000, the Company undertakes to contribute half of the costs amounted to HK$2,515,0006
    Service
    Agreement with Hong Kong Applied Science and Technology Research Institute in respect of the ITF platform project titled "Panoramic
    Video Processor" dated March 31, 2016
    The
    total amount of the Service Agreement payable by the Company is HK$2,800,0007
    Preliminary
    Cooperation Agreement with Hong Kong Applied Science and Technology Research Institute for Establishment of Joint Research
    and Development Centre in research of 3D imaging technology and other innovations on June 20, 2016
    A
    total sum of HK$10,000,000 will be payable by the Company for a period of three years effective from June 20, 20168
    Service
    Agreement with Hong Kong Applied Science and Technology Research Institute in respect of specifications of "Customized
    PCIe structured ASIC board with implementation of intelligent video enhancement" dated October 31, 2016
    The
    total amount of the Service Agreement payable by the Company is HK$4,800,0009
    Service
    Agreement with Hong Kong Applied Science and Technology Research Institute in respect of specifications of structured ASIC
    for 3D 360-degree HMD device dated in January 2017
    The
    total amount of the Service Agreement payable by the Company is HK$4,800,00010
    Sale
    Distribution Agreement with a customer in respect of sales of autostereoscopic 3D digital video walls on January 29, 2018
    The
    total amount of the Sales Distribution Agreement payable by the customer is RMB36,900,00011
    Sale
    Distribution Agreement with a customer in respect of sales of standalone digital signage on January 29, 2018
    The
    total amount of the Sales Distribution Agreement payable by the customer is RMB39,100,000    68     D.
    
    Exchange
    Controls Australia
has largely abolished exchange controls on investment transactions. The Australian dollar is freely convertible into U.S. dollars.
In addition, there are currently no specific rules or limitations regarding the export from Australia of profits, dividends, capital
or similar funds belonging to foreign investors, except that certain payments to non-residents must be reported to the Australian
Transaction Reports and Analysis Centre, which monitors such transaction, and amounts on account of potential Australian tax liabilities
which may be required to be withheld unless a relevant taxation treaty can be shown to apply. Article 11.8 of the free trade agreement
between Australia and the US provides that all transfers relating to a covered investment is to be made freely and without delay
into and out of each territory. Such transfers include inter alia contributions to capital, including the initial contribution;
profits, dividends, capital gains and proceeds from the sale of all or any part of the covered investment or from the partial
or complete liquidation of the covered investment.  The
Foreign Acquisitions and Takeovers Act 1975 Under
Australian law, in certain circumstances foreign persons are prohibited from acquiring more than a limited percentage of the shares
in an Australian company without approval from the Australian Treasurer. These limitations are set forth in the Australian Foreign
Acquisitions and Takeovers Act, or the Takeovers Act. Under
the Takeovers Act, as currently in effect, any foreign person, together with associates, or parties acting in concert, is prohibited
(without approval) from acquiring 20% or more of the shares in any company having total assets of A$252 million or more (or A$1,094
million or more in case of private (non-government) U.S. investors). "Associates" is a broadly defined term under
the Takeovers Act and includes:  •
    
    spouses,
    lineal ancestors and descendants, and siblings;•
    
    any person with
    whom the person is acting, or proposes to act, in concert;  •
    
    partners,
    officers of companies, the company, employers and employees, and corporations;  •
    
    their
    shareholders related through substantial shareholdings or voting power;  •
    
    corporations
    whose directors are controlled by the person, or who control a person; and  •
    
    associations
    between trustees and substantial beneficiaries of trust estates. In
addition, a foreign person may not acquire shares in a company having total assets of A$252 million or more (or A$1,094 million
or more in case of private (non-government) U.S. investors) if, as a result of that acquisition, the total holdings of all foreign
persons and their associates will exceed 40% in aggregate without the approval of the Australian Treasurer. If the necessary approvals
are not obtained, the Treasurer may make an order requiring the acquirer to dispose of the shares it has acquired within a specified
period of time. At present, we do not have total assets of A$252million or more. At this time, our total assets do not exceed
any of the above thresholds and therefore no approval would be required from the Australian Treasurer. Nonetheless, should our
total assets exceed the threshold in the future, we will be mindful to monitor the holdings for foreign persons (together with
the associates) to ensure that the thresholds will not be exceeded without the Australian Treasurer's approval. Each
foreign person seeking to acquire holdings in excess of the above caps (including their associates, as the case may be) would
need to complete an application form setting out the proposal and relevant particulars of the acquisition/shareholding. The Australian
Treasurer then has 30 days to consider the application and make a decision. However, the Australian Treasurer may extend the period
by up to a further 90 days by publishing an interim order. The Australian Treasurer has issued a guideline titled Australia's
Foreign Investment Policy which provides an outline of the policy. As for the risk associated with seeking approval, the policy
provides that the Treasurer will reject an application if it is contrary to the national interest. If
the level of foreign ownership exceeds 40% at any time (or if one individual not ordinarily resident in Australia, a foreign corporation
or a foreign government holds at least 20%), we would be considered a foreign person under the Takeovers Act. In such event, we
would be required to obtain the approval of the Australian Treasurer for our company, together with our associates, to acquire
(i) more than 20% of an Australian company or business with assets totaling over A$252 million (or A$1,094 million if we
were considered a private US investor); or (ii) any direct or indirect ownership in certain real estate interests. The
percentage of foreign ownership in our company would also be included in determining the foreign ownership of any Australian company
or business in which we may choose to invest. Since we have no current plans for any such investments or acquisitions and do not
currently own any relevant real estate interests, any such approvals required to be obtained by us as a foreign person under the
Takeovers Act will not affect our current or future ownership or lease of real estate interests in Australia. Our
Constitution does not contain any additional limitations on a non-resident's right to hold or vote our securities. Australian
law requires the transfer of shares in our company to be made in writing. No stamp duty will be payable in Australia on the transfer
of ordinary shares quoted on the NASDAQ.   69     The
Financial Transactions Reports Act 1988  The
Financial Transactions Reports Act 1988 (Cth) is an act of the Parliament of the Commonwealth of Australia, designed to
facilitate the administration and enforcement of Australia's taxation laws. It provides for the reporting of certain financial
transactions and transfers, including the export or import of currency exceeding $10,000 to Australian Transaction Reports and
Analysis Centre.  The
Income Tax Assessment Act of 1936 and the Income Tax Assessment Act of 1997 (collectively, the "Tax Act")  The
Income Tax Assessment Act 1936 (Cth) and the Income Tax Assessment Act 1997 (Cth) (collectively, the " Tax
Act ") is the principal law governing the imposition of Federal taxes in Australia (except goods and services tax and
a number of specific taxes such as fringe benefits tax).  Under
the Tax Act, in some circumstances overseas residents are obliged to pay income tax in Australia on income derived from Australian
sources or property.  E.
    
    Taxation  The
following is a summary of the current tax laws of the U.S. (including the Internal Revenue Code of 1986, as amended, its legislative
history, existing and proposed regulations thereunder, published rulings and court decisions) and Australia as they relate to
us and our shareholders, including United States and other non-Australian shareholders. The summary is based upon laws and relevant
interpretations thereof in effect as of the date of this annual report, all of which are subject to change, possibly on a retroactive
basis. The discussion does not address any aspects of U.S. taxation other than federal income taxation or any aspects of Australian
taxation other than federal income taxation, inheritance taxation, stamp duty and goods and services tax. Existing
and prospective holders of ordinary shares are advised to consult their own tax advisors with respect to the specific tax consequences
to them of the purchase, ownership and disposition of ordinary shares, including, in particular, the effect of any foreign, state
or local taxes.  Australian
Tax Consequences  Non-Australian
residents may be liable to pay Australian tax on income derived from Australian sources. One mechanism by which that tax is paid
(for non-residents who have no permanent establishment or fixed base in Australia or where the income is not connected with a
permanent establishment or fixed base) is known as withholding tax. Dividends paid by a resident Australian company to a resident
of the United States of America who is entitled to the benefits of the Australia/US double tax treaty and is beneficially entitled
to the dividends are subject to withholding tax at the rate of 15% to the extent the dividends are ‘unfranked'. The
rate of withholding tax on dividends is normally 30%, but since the United States has concluded a double tax treaty agreement
with Australia, the rate is reduced to 15% where the benefits of the treaty apply. It should be noted, however, that under Section
128B(3) of the Income Tax Assessment Act 1936 (Cth), to the extent that dividends paid to non-residents have been franked (generally
where a company pays tax itself), such dividends are exempt from withholding tax. "Franked dividends" is the expression
given to dividends when the profits out of which those dividends are paid have been taxed at company level and such tax is allocated
to the dividend. Accordingly, an Australian company paying fully franked dividends to a non-resident is not required to deduct
any withholding tax. Dividends on which withholding tax has been paid are generally not subject to any further Australian tax.
In other words, the withholding tax should represent the final Australian tax liability in relation to those dividends. The
pertinent provisions of the double tax treaty between Australia and the United States provide that dividends are primarily liable
for tax in the country of residence of the beneficial owner of the dividends. However, the source country, in this case Australia,
may also tax them, but in such case the tax will be limited to 15% if the benefits of the treaty apply. Where the beneficial owner
is a United States resident corporation that directly holds at least 10% of the voting power in us, the tax will be limited to
5%. The 15% limit does not apply to dividends derived by a resident of the United States of America who has a permanent establishment
or fixed base in Australia, if the holding giving rise to the dividends is effectively connected with that establishment or base.
Such dividends are taxed on a net assessment basis as business income or independent personal services income as the case may
be. We
have not paid any cash dividends since our inception and we do not anticipate the payment of cash dividends in the foreseeable
future. See "Item 8.A. Financial Statements and Other Financial Information–Dividend Policy." Capital
gains tax in Australia is payable on net assessable ‘real gains' over the period in which the shares have been held,
that is, the difference between the selling price and the total cost price calculated under Australian tax law. In some cases
the cost price may be indexed for inflation, or, if the shares have been held for more than one year, certain taxpayers can, with
respect to shares held for more than one year, be eligible for a discount of up to 50% of the gross gain. Capital losses may be
available to offset capital gains.   70     Stamp
Duty  Any
transfer of shares through trading on the ASX and NASDAQ, whether by Australian residents or foreign residents, should not be
subject to stamp duty.  Australian
Death Duty  Australia
does not have estate or death duties. Generally no capital gains tax liability is realized upon the inheritance of a deceased
person's shares. The disposal of inherited shares by beneficiaries, may, however, give rise to a capital gains tax liability.  Goods
and Services Tax  The
issue or transfer of shares will not incur Australian goods and services tax and does not require a stockholder to register for
Australian goods and services tax purposes.  U.S.
Federal Income Tax Considerations  The
following discussion summarizes the principal U.S. federal income tax considerations relating to the purchase, ownership and disposition
of our ordinary shares by a U.S. holder (as defined below) holding such shares as capital assets (generally, property held for
investment). This summary is based on the Internal Revenue Code of 1986, as amended (the "Code"), Treasury regulations,
administrative pronouncements of the U.S. Internal Revenue Service (the "IRS") and judicial decisions, all as in effect
on the date hereof, and all of which are subject to change (possibly with retroactive effect) and to differing interpretations.
This summary does not describe any state, local or non-U.S. tax law considerations, or any aspect of U.S. federal tax law other
than income taxation; U.S. holders are urged to consult their own tax advisors regarding such matters. This
summary does not purport to address all material federal income tax consequences that may be relevant to a holder of ordinary
shares or warrants. This summary does not take into account the specific circumstances of any particular investors, some of which
(such as tax-exempt entities, banks or other financial institutions, insurance companies, broker-dealers, traders in securities
that elect to use a mark-to-market method of accounting for their securities holdings, regulated investment companies, real estate
investment trusts, U.S. expatriates, investors liable for the alternative minimum tax, partnerships and other pass-through entities,
investors that own or are treated as owning 10% or more of our voting stock, investors that hold the ordinary shares as part of
a straddle, hedge, conversion or constructive sale transaction or other integrated transaction, and U.S. holders whose functional
currency is not the U.S. dollar) may be subject to special tax rules  . This discussion does not address U.S.
federal tax laws other than those pertaining to U.S. federal income taxation (such as estate or gift tax laws or the Medicare
tax on investment income), nor does it address any aspects of U.S. state or local or non-U.S. taxation. As
used below, a "U.S. Holder" is a beneficial owner of an ordinary share that is, for U.S. federal income tax purposes,
(i) a citizen or resident alien individual of the United States, (ii) a corporation (or an entity taxable as a corporation)
created or organized under the law of the United States, any State thereof or the District of Columbia, (iii) an estate,
the income of which is subject to U.S. federal income tax without regard to its source, or (iv) a trust if (1) a court
within the United States is able to exercise primary supervision over the administration of the trust, and one or more U.S. persons
have the authority to control all substantial decisions of the trust, or (2) the trust has a valid election in effect under
applicable U.S. Treasury Regulations to be treated as a U.S. person. For purposes of this discussion, a "Non-U.S. Holder"
is a beneficial owner of an ordinary share or warrant that is (i) a non-resident alien individual, (ii) a corporation
(or an entity taxable as a corporation) created or organized in or under the law of a country other than the United States or
a political subdivision thereof or (iii) an estate or trust that is not a U.S. holder. This discussion does not address any
aspect of U.S. federal gift or estate tax, or state, local or non-U.S. tax laws. Additionally, the discussion does not consider
the tax treatment of partnerships or other pass-through entities or persons who hold ordinary shares through such entities. If
a partnership (including for this purpose any entity treated as a partnership for U.S. federal tax purposes) is a beneficial owner
of ordinary shares or warrants, the U.S. federal tax treatment of a partner in the partnership generally will depend on the status
of the partner and the activities of the partnership. A holder of ordinary shares or warrants that is a partnership and partners
in that partnership are urged to consult their own tax advisers regarding the U.S. federal income tax consequences of purchasing,
holding and disposing of ordinary shares or warrants. We
have not sought a ruling from the IRS or an opinion of counsel as to any U.S. federal income tax consequence described herein.
The IRS may disagree with the description herein, and its determination may be upheld by a court.   71     GIVEN
THE COMPLEXITY OF THE TAX LAWS AND BECAUSE THE TAX CONSEQUENCES TO ANY PARTICULAR INVESTOR MAY BE AFFECTED BY MATTERS NOT
DISCUSSED HEREIN, PROSPECTIVE INVESTORS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE SPECIFIC TAX CONSEQUENCES
OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF ORDINARY SHARES, INCLUDING THE APPLICABILITY AND EFFECT OF STATE, LOCAL AND NON-U.S.
TAX LAWS, AS WELL AS U.S. FEDERAL TAX LAWS.  TO
ENSURE COMPLIANCE WITH REQUIREMENTS IMPOSED BY THE IRS UNDER TREASURY CIRCULAR 230, WE INFORM YOU THAT (1) ANY DISCUSSION
OF U.S. FEDERAL INCOME TAX ISSUES CONTAINED HEREIN (INCLUDING ANY ATTACHMENTS), UNLESS OTHERWISE SPECIFICALLY STATED, WAS NOT
INTENDED OR WRITTEN TO BE USED, AND CANNOT BE USED, FOR THE PURPOSE OF AVOIDING PENALTIES UNDER THE UNITED STATES INTERNAL REVENUE
CODE, AND (2) EACH U.S. HOLDER SHOULD SEEK ADVICE BASED UPON THEIR PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR.  Taxation
of Distributions U.S.
Holders.  In general, subject to the passive foreign investment company ("PFIC") rules discussed below,
a distribution on an ordinary share will constitute a dividend for U.S. federal income tax purposes to the extent that it is made
from our current or accumulated earnings and profits as determined under U.S. federal income tax principles. If a distribution
exceeds the amount of our current and accumulated earnings and profits, it will be treated as a non-taxable reduction of basis
to the extent of the U.S. Holder's tax basis in the ordinary share on which it is paid, and to the extent it exceeds that
basis it will be treated as a capital gain. For purposes of this discussion, the term "dividend" means a distribution
that constitutes a dividend for U.S. federal income tax purposes. The
gross amount of any dividend on an ordinary share (which will include the amount of any Australian taxes withheld) generally will
be subject to U.S. federal income tax as foreign source dividend income and will not be eligible for the corporate dividends received
deduction. The amount of a dividend paid in Australian currency will be its value in U.S. dollars based on the prevailing spot
market exchange rate in effect on the day that the U.S. Holder receives the dividend, whether or not the dividend is converted
into U.S. dollars. A U.S. holder will have a tax basis in any distributed Australian currency equal to its U.S. dollar amount
on the date of receipt, and any gain or loss realized on a subsequent conversion or other disposition of the Australian currency
generally will be treated as U.S. source ordinary income or loss. If dividends paid in Australian currency are converted into
U.S. dollars on the date they are received by a U.S. Holder, the U.S. Holder generally should not be required to recognize foreign
currency gain or loss in respect of the dividend income. U.S. Holders are urged to consult their own tax advisers regarding the
treatment of any foreign currency gain or loss if any Australian currency received by the U.S. Holder is not converted into U.S.
dollars on the date of receipt. Subject
to certain exceptions for short-term and hedged positions, any dividend that a non-corporate holder receives on an ordinary share
will be subject to tax rate of 20% if the dividend is a "qualified dividend". A dividend on an ordinary share will
be a qualified dividend if (i) either (a) the ordinary shares are readily tradable on an established securities market
in the U.S. or (b) we are eligible for the benefits of a comprehensive income tax treaty with the U.S. that the U.S. Secretary
of the Treasury determines is satisfactory for purposes of these rules and that includes an exchange of information program,
and (ii) we were not, in the year prior to the year the dividend was paid, and are not, in the year the dividend is paid,
a PFIC. The ordinary shares is expected to be listed on the Nasdaq Capital Market in 2016, which should then qualify them as readily
tradable on an established securities market in the United States. In any event, the double tax treaty between Australia and the
U.S. (the "Treaty") satisfies the requirements of clause (i)(b), and, although the matter is not free from doubt,
we believe that we should be a resident of Australia entitled to the benefits of the Treaty. However, because the facts relating
to our entitlement to the benefits of the Treaty can change over time, there can be no assurance that we will be entitled to the
benefits of the Treaty for any taxable year. As discussed above, qualified dividends do not include dividends paid by a company
which was a PFIC in the year prior to the year the dividend was paid, or in the year the dividend is paid. Based on our audited
financial statements and relevant market and shareholder data, we believe we were not a PFIC for U.S. federal income tax purposes
for our December 31, 2016 taxable year. Based on our audited financial statements and our current expectations regarding the value
and nature of our assets, the sources and nature of our income, and relevant market and shareholder data, we do not expect that
we could be classified as a PFIC for our December 31, 2016 taxable year. Given that the determination of PFIC status involves
the application of complex tax rules, and that it is based on the nature of our income and assets from time to time, no assurances
can be provided that we will not be considered a PFIC for any past or future taxable year. Moreover, as described in the section
below entitled "Passive Foreign Investment Company Rules," if we were a PFIC in a year while a U.S. Holder held an
ordinary share, and if the U.S. Holder has not made a qualified electing fund election effective for the first year the U.S. Holder
held the ordinary share, the ordinary share remains an interest in a PFIC for all future years or until such an election is made.
The IRS takes the position that that rule will apply for purposes of determining whether an ordinary share is an interest
in a PFIC in the year a dividend is paid or in the prior year, even if the Company does not satisfy the tests to be a PFIC in
either of those years.   72     Even
if dividends on the ordinary shares would otherwise be eligible for qualified dividend treatment, in order to qualify for the
reduced qualified dividend tax rates, a non-corporate holder must hold the ordinary share on which a dividend is paid for more
than 60 days during the 120-day period beginning 60 days before the ex-dividend date, disregarding for this purpose any period
during which the non-corporate holder has an option to sell, is under a contractual obligation to sell or has made (and not closed)
a short sale of substantially identical stock or securities, is the grantor of an option to buy substantially identical stock
or securities or, pursuant to Treasury regulations, has diminished their risk of loss by holding one or more other positions with
respect to substantially similar or related property. In addition, to qualify for the reduced qualified dividend tax rates, the
non-corporate holder must not be obligated to make related payments with respect to positions in substantially similar or related
property. Payments in lieu of dividends from short sales or other similar transactions will not qualify for the reduced qualified
dividend tax rates. A non-corporate holder that receives an extraordinary dividend eligible for the reduced qualified dividend
rates must treat any loss on the sale of the stock as a long-term capital loss to the extent of the dividend. For purposes of
determining the amount of a non-corporate holder's deductible investment interest expense, a dividend is treated as investment
income only if the non-corporate holder elects to treat the dividend as not eligible for the reduced qualified dividend tax rates.
Special limitations on foreign tax credits with respect to dividends subject to the reduced qualified dividend tax rates apply
to reflect the reduced rates of tax. The
U.S. Treasury has announced its intention to promulgate rules pursuant to which non-corporate holders of stock of non-U.S.
corporations, and intermediaries though whom the stock is held, will be permitted to rely on certifications from issuers to establish
that dividends are treated as qualified dividends. Because those procedures have not yet been issued, it is not clear whether
we will be able to comply with them. Non-corporate
holders of ordinary shares are urged to consult their own tax advisers regarding the availability of the reduced qualified dividend
tax rates in the light of their own particular circumstances. Any
Australian withholding tax will be treated as a foreign income tax eligible for credit against a U.S. Holder's U.S. federal
income tax liability, subject to generally applicable limitations under U.S. federal income tax law. For purposes of computing
those limitations separately under current law for specific categories of income, a dividend generally will constitute foreign
source "passive category income" or, in the case of certain holders, "general category income". A U.S.
Holder will be denied a foreign tax credit with respect to Australian income tax withheld from dividends received with respect
to the ordinary shares to the extent the U.S. Holder has not held the ordinary shares for at least 16 days of the 30-day period
beginning on the date which is 15 days before the ex-dividend date or to the extent the U.S. Holder is under an obligation to
make related payments with respect to substantially similar or related property. Any days during which a U.S. Holder has substantially
diminished its risk of loss on the ordinary shares are not counted toward meeting the 16-day holding period required by the statute.
The rules relating to the determination of the foreign tax credit are complex, and U.S. Holders are urged to consult with
their own tax advisers to determine whether and to what extent they will be entitled to foreign tax credits as well as with respect
to the determination of the foreign tax credit limitation. Alternatively, any Australian withholding tax may be taken as a deduction
against taxable income, provided the U.S. Holder takes a deduction and not a credit for all foreign income taxes paid or accrued
in the same taxable year. In general, special rules will apply to the calculation of foreign tax credits in respect of dividend
income that is subject to preferential rates of U.S. federal income tax. Non-U.S.
Holders.  A dividend paid to a Non-U.S. Holder on an ordinary share will not be subject to U.S. federal income tax unless
the dividend is effectively connected with the conduct of trade or business by the non-U.S. Holder within the United States (and
is attributable to a permanent establishment or fixed base the Non-U.S. Holder maintains in the United States if an applicable
income tax treaty so requires as a condition for the Non-U.S. Holder to be subject to U.S. taxation on a net income basis on income
from the ordinary share). A Non-U.S. Holder generally will be subject to tax on an effectively connected dividend in the same
manner as a U.S. Holder. A corporate Non-U.S. Holder may also be subject under certain circumstances to an additional "branch
profits tax," the rate of which may be reduced pursuant to an applicable income tax treaty.  Taxation
of Capital Gains  U.S.
Holders.  Subject to the passive foreign investment company rules discussed below, on a sale or other taxable disposition
of an ordinary share, a U.S. Holder will recognize capital gain or loss in an amount equal to the difference between the U.S.
Holder's adjusted basis in the ordinary share and the amount realized on the sale or other disposition, each determined
in U.S. dollars. Such
capital gain or loss will be long-term capital gain or loss if at the time of the sale or other taxable disposition the ordinary
share has been held for more than one year. In general, any adjusted net capital gain of an individual is subject to a federal
income tax rate of 20%. Capital gains recognized by corporate U.S. Holders generally are subject to U.S. federal income tax at
the same rate as ordinary income. The deductibility of capital losses is subject to various limitations.   73     Any
gain a U.S. Holder recognizes generally will be U.S. source income for U.S. foreign tax credit purposes, and, subject to certain
exceptions, any loss will generally be a U.S. source loss. If an Australian tax is withheld on a sale or other disposition of
an ordinary share, the amount realized will include the gross amount of the proceeds of that sale or disposition before deduction
of the Australian tax. The generally applicable limitations under U.S. federal income tax law on crediting foreign income taxes
may preclude a U.S. Holder from obtaining a foreign tax credit for any Australian tax withheld on a sale of an ordinary share.
The rules relating to the determination of the foreign tax credit are complex, and U.S. Holders are urged to consult with
their own tax advisers regarding the application of such rules. Alternatively, any Australian withholding tax may be taken as
a deduction against taxable income, provided the U.S. Holder takes a deduction and not a credit for all foreign income taxes paid
or accrued in the same taxable year. Non-U.S.
Holders.  A Non-U.S. Holder will not be subject to U.S. federal income tax on a gain recognized on a sale or other disposition
of an ordinary share unless (i) the gain is effectively connected with the conduct of a trade or business by the Non-U.S.
Holder within the United States (and is attributable to a permanent establishment or fixed base that the Non-U.S. Holder maintains
in the United States if an applicable income tax treaty so requires as a condition for the Non-U.S. Holder to be subject to U.S.
taxation on a net income basis on income from the ordinary share), or (ii) in the case of a Non-U.S. Holder who is an individual,
the Non-U.S. Holder is present in the United States for 183 or more days in the taxable year of the sale or other disposition
and certain other conditions apply. Any effectively connected gain of a corporate Non-U.S. Holder may also be subject under certain
circumstances to an additional "branch profits tax", the rate of which may be reduced pursuant to an applicable income
tax treaty.  Passive
Foreign Investment Company Rules A
special set of U.S. federal income tax rules applies to a foreign corporation that is a PFIC for U.S. federal income tax purposes.
As noted above, based on our audited financial statements and relevant market and shareholder data, we believe we were not a PFIC
for U.S. federal income tax purposes for our December 31, 2015 taxable year. Moreover, given that the determination of PFIC status
involves the application of complex tax rules, and that it is based on the nature of our income and assets from time to time,
no assurances can be provided that we will be considered a PFIC for any future taxable year. In
general, a foreign corporation is a PFIC if at least 75% of its gross income for the taxable year is passive income or if at least
50% of its assets for the taxable year produce passive income or are held for the production of passive income. In general, passive
income for this purpose means, with certain designated exceptions, dividends, interest, rents, royalties (other than certain rents
and royalties derived in the active conduct of trade or business), annuities, net gains from dispositions of certain assets, net
foreign currency gains, income equivalent to interest, income from notional principal contracts and payments in lieu of dividends.
The determination of whether a foreign corporation is a PFIC is a factual determination made annually and is therefore subject
to change. Subject to exceptions pursuant to certain elections that generally require the payment of tax, once stock in a foreign
corporation is classified as stock in a PFIC in the hands of a particular shareholder that is a U.S. person, it remains stock
in a PFIC in the hands of that shareholder. Unfavorable
tax consequences for a U.S. Holder can occur if we are treated as a PFIC for any year while a U.S. Holder owns ordinary shares.
Certain of these tax consequences can be mitigated with respect to a U.S. Holder's ordinary shares (but not a U.S. Holder's
warrants) if the U.S. Holder makes, or has made, a timely qualified electing fund election or election to mark to market the holder's
ordinary shares, and such election is in effect for the first taxable year during which the U.S. Holder owns ordinary shares that
we are a PFIC. If we are treated as a PFIC, and neither election is made, then contrary to the tax consequences described in "U.S.
Federal Income Tax Considerations-Taxation of Distributions" and "U.S. Federal Income Tax Considerations-Taxation
of Capital Gains" above, in any year in which the U.S. Holder either disposes of an ordinary share at a gain or receives
one or more "excess distributions" in respect of our ordinary shares, special rules apply to the taxation of
the gain or the excess distributions. For purposes of these rules, a U.S. Holder will be treated as receiving an "excess
distribution" to the extent that actual or constructive distributions received in the current taxable year exceed 125% of
the average distributions (whether actual or constructive and whether or not out of earnings and profits) received by such U.S.
Holder in respect of our ordinary shares during the three preceding years or, if shorter, the U.S. Holder's holding period.
A disposition of an ordinary share, for purposes of these rules, includes many transactions on which gain or loss is not realized
under general U.S. federal income tax rules (but generally should not include the exercise of a warrant, as discussed below).
The gain or the excess distributions must be allocated ratably to each day the U.S. Holder has held the ordinary share, as the
case may be. Amounts allocated to each year are taxable as ordinary income in their entirety (and are not eligible for the reduced
qualified dividend rates) and not as capital gain, and amounts allocable to prior years may not be offset by any deductions or
losses. Amounts allocated to each such prior year are taxable at the highest rate in effect for that year and are subject to an
interest charge at the rates applicable to deficiencies for income tax for those periods. In addition, a U.S. Holder's tax
basis in an ordinary share that is acquired from a decedent would not receive a step-up to fair market value as of the date of
the decedent's death but instead would be equal to the decedent's basis, if lower.   74     The
special PFIC rules described above will not apply to a U.S. Holder's ordinary shares if the U.S. Holder makes a timely
election, which remains in effect, to treat us as a qualified electing fund, or QEF, for the first taxable year in which the U.S.
Holder owns an ordinary share and in which we are classified as a PFIC, provided that we comply with certain reporting requirements.
Instead, a U.S. Holder that has made a QEF election is required for each taxable year to include in income a pro rata share of
our ordinary earnings as ordinary income and a pro rata share of its net capital gain as long-term capital gain, subject to a
separate election to defer payment of taxes, which deferral is subject to an interest charge. In order for such a QEF election
to be valid, we must provide U.S. Holders either (1) a statement showing such U.S. Holder's pro rata share of our ordinary
earnings and net capital gain (calculated for U.S. tax purposes) for the Company's taxable year, (2) sufficient information
to enable the U.S. Holder to calculate its pro rata share for such year, or (3) a statement that the Company has permitted
the U.S. Holder to inspect and copy its permanent books of account, records, and such other documents as may be maintained by
us that are necessary to establish that PFIC ordinary earnings and net capital gain are computed in accordance with U.S. income
tax principles. We have not yet determined whether, in years in which we are classified as a PFIC, we will make the computations
necessary to supply U.S. Holders with the information needed to report income and gain pursuant to a QEF election. It is, therefore,
possible that U.S. Holders would not be able to make or retain that election in any year we are a PFIC. The QEF election is made
on a shareholder-by-shareholder basis and once made, can only be revoked with the consent of the IRS. A U.S. Holder generally
makes a QEF election by attaching a completed IRS Form 8621 (Return by a Shareholder of a Passive Foreign Investment Company
or Qualified Electing Fund), including the information provided in a PFIC annual information statement, to a timely filed U.S.
federal income tax return for the tax year to which the election relates. Retroactive QEF elections may only be made by filing
a protective statement with such return or with the consent of the IRS. A U.S. Holder may make a separate election to defer the
payment of taxes on undistributed income inclusions under the QEF rules, but if deferred, any such taxes will be subject to an
interest charge. If
a U.S. Holder has elected the application of the QEF rules to the U.S. Holder's ordinary shares, and the special tax
and interest charge rules described in the second preceding paragraph do not apply to such shares (because of a timely QEF
election for the first tax year of the U.S. Holder's holding period for such shares, or, as described below, a purge of
the PFIC taint pursuant to a special purging election), any gain realized on the disposition of an ordinary share generally will
be taxable as capital gain and no interest charge will be imposed. As discussed above, U.S. Holders of a QEF are currently taxed
on their pro rata shares of the QEF's earnings and profits, whether or not distributed. In such case, a subsequent distribution
of such earnings and profits that were previously included in income generally will not be taxable as a dividend. The tax basis
of a U.S. Holder's shares in a QEF will be increased by amounts that are included in income, and decreased by amounts distributed
but not taxed as dividends, under the above rules. Similar basis adjustments apply to property if by reason of holding such property
the U.S. Holder is treated under applicable attribution rules as owning shares in a QEF. If
a QEF election is not made for the first taxable year in which the U.S. Holder owns an ordinary share and in which we are a PFIC,
certain elections can be made while we continue to satisfy the definition of a PFIC that, combined with a QEF election, can cause
the QEF election to be treated as having been made for that first taxable year. Those elections may require the electing shareholder
to recognize gain on a constructive sale or to be taxable on the shareholder's share of certain undistributed profits of
the foreign corporation. If gain or income is recognized pursuant to one of those elections, the special PFIC rules set forth
in the fourth preceding paragraph would apply to that gain or income. Even if a QEF election ceases to apply because in a later
taxable year we cease to satisfy the tests to be a PFIC, the QEF election will apply again in any subsequent year in which the
Company again satisfies the tests to be a PFIC. Moreover, if a U.S. Holder sells all of the ordinary shares they own and later
reacquires other ordinary shares, any QEF election the U.S. Holder has made that remains in effect will apply to the ordinary
shares acquired later. The applicable Treasury regulations provide that the Commissioner of the IRS has the discretion to invalidate
or terminate a QEF election if the U.S. Holder or we, or an intermediary, fails to satisfy the requirements for the QEF election.   75     The
special PFIC rules described in the fourth preceding paragraph will not apply to a U.S. Holder's ordinary shares if
the U.S. Holder elects to mark the U.S. Holder's ordinary shares to market each year, provided that the ordinary shares
are considered "marketable stock" within the meaning of the applicable Treasury regulations. A U.S. Holder that makes
this election will recognize as ordinary income or loss each year an amount equal to the difference, if any, as of the close of
the taxable year between the fair market value of the U.S. Holder's ordinary shares and the U.S. Holder's adjusted
tax basis in the ordinary shares. Losses would be allowed only to the extent of net mark-to-market gain previously included in
income by the U.S. Holder under the election for prior taxable years, reduced by losses allowed in prior taxable years. If the
mark-to-market election were made, then the special PFIC rules set forth in the fourth preceding paragraph would not apply
for periods covered by the election. In general, the ordinary shares will be marketable stock within the meaning of the applicable
Treasury regulations if they are traded, other than in de minimis quantities, on at least 15 days during each calendar quarter
on a "qualified exchange or other market" within the meaning of the applicable Treasury regulations and certain other
requirements are met. The Australian Securities Exchange is a qualified exchange within the meaning of the applicable Treasury
regulations. Thus, the ordinary shares should be "marketable stock" within the meaning of the applicable Treasury
regulations. If a U.S. Holder makes a mark-to-market election, but does not make that election for the first taxable year in which
the U.S. Holder owns an ordinary share and in which the Company is classified as a PFIC, and if the U.S. Holder had not made a
QEF election for that first such taxable year, the rules set forth in the fourth preceding paragraph will apply to any distributions
on an ordinary share in the year of the mark-to-market election, to any gain recognized on an actual sale of an ordinary share
in that year, and to any gain recognized in that year pursuant to the mark-to-market election. The mark-to-market rules generally
continue to apply to a U.S. Holder who makes the mark-to-market election, even in years we do not satisfy the tests to be a PFIC. A
U.S. Holder who owns ordinary shares during a year in which we are classified as a PFIC generally will remain subject to the rules set
forth in the fifth preceding paragraph for all taxable years if the U.S. Holder has not made a QEF election or a mark-to-market
election for the first taxable year in which the U.S. Holder owns an ordinary share and in which we are classified as a PFIC.
In that event, those rules will apply to any gains on dispositions of ordinary shares and to any "excess distributions." 
It is, however, possible for a U.S. Holder to avoid this "once a PFIC, always a PFIC" result by electing to treat
all of the U.S. Holder's ordinary shares as sold for their fair market value as of the last day of the last taxable year
we satisfy the tests to be a PFIC, provided the statute of limitations has not run for that year. If a gain is recognized on that
constructive sale, the rules set forth in the fifth preceding paragraph would apply to that gain. If
we are classified as a PFIC for a taxable year, and, at any time during such taxable year, have a non-U.S. subsidiary that is
classified as a PFIC, U.S. Holders generally would be deemed to own a portion of the shares of such lower-tier PFIC, and generally
could incur liability for the deferred tax and interest charge described in the sixth preceding paragraph, if we receive a distribution
from, or dispose of all or part of its interest in, the lower-tier PFIC. We have not yet determined whether, if we are classified
as a PFIC, we would make the computations necessary to supply U.S. Holders with the information needed to make or maintain a QEF
election with respect to the lower-tier PFIC. It is, therefore, possible that U.S. Holders would not be able to make or retain
that election in any taxable year that we are classified as a PFIC and has a non-U.S. subsidiary that is also classified as a
PFIC. U.S. Holders are urged to consult their own tax advisors regarding the tax issues raised by lower-tier PFICs. A
dividend from a foreign corporation that otherwise would qualify for reduced qualified dividend rates does not qualify for that
rate if the foreign corporation is a PFIC in either the taxable year of the dividend or the preceding taxable year. A
U.S. Holder who owns (or is deemed to own) shares in a PFIC during any taxable year, such U.S. Holder may have to file an IRS
Form 8621 (whether or not a QEF or mark-to-market election is made).  GIVEN
THE COMPLEXITIES OF THE PFIC RULES AND THEIR POTENTIALLY ADVERSE TAX CONSEQUENCES, U.S. HOLDERS OF ORDINARY SHARES ARE URGED TO
CONSULT THEIR TAX ADVISERS ABOUT THE PFIC RULES, INCLUDING THE CONSEQUENCES TO THEM OF MAKING A QEF ELECTION OR A MARK-TO-MARKET
ELECTION WITH RESPECT TO THE ORDINARY SHARES IN THE EVENT THAT THE COMPANY QUALIFIES AS A PFIC FOR ANY TAXABLE YEAR.   76     Information
Reporting and Backup Withholding  U.S.
Holders. Dividends paid on, and proceeds from the sale or other disposition of, an ordinary share generally may be subject
to information reporting requirements and may be subject to backup withholding at the rate of 28% unless a U.S. Holder provides
an accurate taxpayer identification number or otherwise demonstrates that they are exempt. The amount of any backup withholding
collected from a payment to a U.S. Holder will be allowed as a credit against the U.S. Holder's U.S. federal income tax
liability and may entitle the U.S. Holder to a refund, provided that certain required information is submitted to the Internal
Revenue Service. Under U.S. federal income tax law and U.S. Treasury Regulations, certain categories of U.S. holders must file
information returns with respect to their investment in, or involvement in, a foreign corporation. U.S. holders are urged to consult
with their own tax advisors concerning such reporting requirements. Non-U.S.
Holders. Non-U.S. Holders generally will be exempt from these information reporting requirements and backup withholding
tax but may be required to comply with certain certification and identification procedures in order to establish their eligibility
for exemption.  THE
DISCUSSION ABOVE IS NOT INTENDED TO CONSTITUTE A COMPLETE ANALYSIS OF ALL TAX CONSIDERATIONS APPLICABLE TO AN INVESTMENT IN ORDINARY
SHARES. HOLDERS AND POTENTIAL HOLDERS ARE URGED TO CONSULT THEIR TAX ADVISER(S) CONCERNING THE TAX CONSEQUENCES RELEVANT
TO THEM IN THEIR PARTICULAR SITUATION.   F.
    
    Dividends
    and Paying Agents Not
applicable.  G.
    
    Statement
    by Experts Not
applicable.  H.
    
    Documents
    on Display We
are subject to the reporting requirements of the United States Securities and Exchange Act of 1934, as amended, or the Exchange
Act, as applicable to "foreign private issuers" as defined in Rule 3b-4 under the Exchange Act. As a foreign private
issuer, we are exempt from certain provisions of the Exchange Act. Accordingly, our proxy solicitations are not subject to the
disclosure and procedural requirements of regulation 14A under the Exchange Act, and transactions in our equity securities by
our officers and directors are exempt from reporting and the "short-swing" profit recovery provisions contained in
Section 16 of the Exchange Act. In addition, we are not required under the Exchange Act to file periodic reports and financial
statements as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act. However, we
will file with the U.S. Securities and Exchange Commission an annual report on Form 20-F containing financial statements that
have been examined and reported on, with and opinion expressed by an independent registered public accounting firm, and we will
submit reports to the U.S. Securities and Exchange Commission on Form 6-K containing (among other things) press releases and unaudited
financial information for the first six months of each fiscal year. We post our annual report on Form 20-F on our website promptly
following the filing of our annual report with the U.S. Securities and Exchange Commission. The information on our website is
not incorporated by reference into this annual report. This
document and the exhibits thereto and any other document we file pursuant to the Exchange Act may be inspected without charge
and copied at prescribed rates at the U.S. Securities and Exchange Commission public reference room at 100 F Street, N.E., Room
1580, Washington D.C. 20549. You may obtain information on the operation of the Securities and Exchange Commission's public
reference room in Washington, D.C. by calling the U.S. Securities and Exchange Commission at 1-800-SEC-0330. The
U.S. Securities and Exchange Commission maintains a website at www.sec.gov that contains reports, proxy and information
statements and other information regarding registrants that make electronic filings with the U.S. Securities and Exchange Commission
using its EDGAR (Electronic Data Gathering, Analysis, and Retrieval) system. The
documents concerning our Company which are referred to in this document may also be inspected at the offices of our registered
office located at Level 7, 420 King William Street, Adelaide SA 5000, Australia.   77     I.
    
    Subsidiary
    Information At
the date of this report, we have 13 subsidiaries as follows:  Subsidiary
    Name
    Place
    of Incorporation
    %
    held
    Business
    scopeCIMC
    Marketing Pty Ltd
    Australia
    100%
    Direct
    Management services
    and tradingBinario
    Ltd
    British
    Virgin Islands
    100%
    Direct
    Investment holding
    companyYamaga
    Ltd.
    Hong
    Kong
    100%
    Direct
    Advertising and
    media servicesDragon
    Creative Ltd
    Hong
    Kong
    100%
    Direct
    Sales and distribution
    of various 3D related products and provision of 3D consulting servicesGlobal
    Vantage Audio Ltd
    Hong
    Kong
    50%
    Indirect
    Sale and distribution
    of audio productsGOXD
    Technology Limited
    Hong
    Kong
    100%
    Indirect
    Development and
    distribution of 3D digital picture framesMarvel
    Digital Ltd
    Hong
    Kong
    100%
    Indirect
    Development of 3D
    autostereoscopic display technology and investment holdingVisumotion
    International Ltd
    Hong
    Kong
    100%
    Indirect
    Sale of software
    and provision of consultancy servicesMarvel
    Digital (Shenzhen) Ltd
    China,
    PRC
    100%
    Indirect
    Manufacturing and
    distribution of 3D products and provision of 3D consultancy servicesMarvel
    Software (Shenzhen) Ltd
    China,
    PRC
    100%
    Indirect
    DormantDigital
    Media Technology Ltd
    Labuan,
    Malaysia
    100%
    Indirect
    Sale and distribution
    of 3D and audio productsYamaga
    Audio Limited
    Nevada,
    USA
    100%
    Direct
    Investment holding
    companyZamora
    Corporation
    Nevada,
    USA
    100%
    Direct
    Sales and administration
    office in USA   ITEM 11.
    
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Our
cash and cash equivalents consist primarily of cash and money market funds in Australia and Hong Kong currency. We invest our
excess cash and cash equivalents in interest-bearing accounts and term deposits with banks in Australia or Hong Kong. Our primary
exposure to market risk is interest income sensitivity, which is affected by changes in the general level of Australian and
or Hong Kong interest rates. However, because of the short-term nature of the instruments in our portfolio, a sudden change in
market interest rates would not be expected to have a material impact on our financial condition and/or results of operation. We
are exposed to foreign currency risk via our operation in Hong Kong and China and trade and other payables we hold. We are required
to make certain payments in U.S. dollars, Hong Kong dollars and Chinese Renminbi and other currencies. An adverse movement in
end-of-period exchange rates would have a material impact on our operating results.  ITEM 12.
    
    DESCRIPTION
    OF SECURITIES OTHER THAN EQUITY SECURITIES  A.
    
    Debt
    Securities Not
applicable.  B.
    
    Warrants
    and Rights Not
applicable.  C.
    
    Other
    Securities Not
applicable.   78     PART
II  ITEM 13.
    
    DEFAULTS,
    DIVIDEND ARREARAGES AND DELINQUENCIES Not
applicable.  ITEM 14.
    
    MATERIAL
    MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS Not
applicable.  ITEM 15.
    
    CONTROLS
    AND PROCEDURES Disclosure Controls and Procedures  Management
of the Company maintain disclosure controls and procedures as such term is defined in Rules 13 a-15 (e) and 15d-15(e) under the
Securities Exchange Act of 1934 as amended (the "Exchange Act"), as amended, that are designed to ensure that information
required to be disclosed in the reports that are filed or submitted under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. Disclosure controls
and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed
in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including the Executive
Chairman and the Group Financial Accountant, as appropriate, to allow timely decisions regarding required disclosure. Disclosure
controls and procedures, no matter how well designed and operated, can only provide reasonable assurance of achieving the desired
control objectives. Management
has carried out an evaluation, under the supervision and with the participation of the Executive Chairman and the Group Financial
Accountant, of the effectiveness of the disclosure controls and procedures as of December 31, 2017. Based on that evaluation,
the Executive Chairman and Group Financial Accountant concluded that the Company's disclosure controls and procedures were
effective as of December 31, 2017.  Management's
Annual Report on Internal Control over Financial Reporting  Management
of the Company is responsible for establishing and maintaining adequate internal control over financial reporting for the Company,
as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The Company's internal control over financial reporting
is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with international financial reporting standards (IFRS) as issued by the International
Accounting Standards Board. A company's internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit
the preparation of financial statements in accordance with international financial reporting standards (IFRS) as issued by the
International Accounting Standards Board and that receipts and expenditures of the company are being made only in accordance with
authorizations of our Board of Directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the company's assets that could have a material effect on the financial statements. A
control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives
of the control system are met. In particular, the design of a control system must be considered relative to their costs. Additionally,
the design of a control system is based in part upon certain assumptions about the likelihood of future events, and there can
be no assurance that any design will succeed in achieving its stated objectives under all potential future conditions. Due to
its inherent limitations, internal control over financial reporting may not prevent or detect all misstatements to the financial
statements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management
assessed the effectiveness of the Company's internal control over financial reporting as of December 31, 2017 based on the
criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") (2013 Framework)
Internal Control-Integrated Framework. Based on this assessment, management concluded that the Company's internal control
over financial reporting is effective as of December 31, 2017 under the COSO 2013 Framework. This
Annual Report does not include an attestation report of the Company's registered public accounting firm regarding internal
control over financial reporting. Management's report was not subject to attestation by the Company's registered public
accounting firm pursuant to amendments made by the enactment of the Dodd-Frank bill that permit the Company to provide only management's
annual report on internal control over financial reporting in this Annual Report due to a transition period established by rules
of the Securities Exchange Commission for newly public companies.   79     Changes
in Internal Control over Financial Reporting  There
have been no significant changes in the Company's internal control over financial reporting that have materially affected,
or are reasonably likely to materially affect internal control over financial reporting during the period covered by this Annual
Report.  ITEM 15T.
    
    CONTROLS
    AND PROCEDURES Not
applicable.  ITEM 16.
    
    RESERVED Not
applicable.  ITEM 16A.
    
    AUDIT
    COMMITTEE FINANCIAL EXPERT Not
applicable.  ITEM 16B.
    
    CODE
    OF ETHICS We
have adopted a code of ethics that applies to our executive directors and chief financial officer. A copy of this Code of Ethics
is available on the Company's website at www.imtechltd.com . No
waivers to this Code of Ethics were granted to our executive directors or chief financial officer during the fiscal year ended
December 31, 2017.  ITEM 16C.
    
    PRINCIPAL
ACCOUNTANT FEES AND SERVICES  HKCMCPA
Limited is our Principal Independent Registered Public Accountants engaged to audit our financial statements for the fiscal years
ended December 31, 2017 and 2016. The following table shows the fees that we paid or accrued for the audit and other services
provided by HKCMCPA Company Limited, for the fiscal years ended December 31, 2017 and 2016.  Fee
    Category
    
    2017
    
    
    2016Audit
    Fees
    
    US$
    36,000
    
    
    US$
    33,000Audit-Related
    Fees
    
    US$
    --
    
    
    US$
    --Tax
    Fees
    
    US$
    --
    
    
    US$
    --All
    Other Fees
    
    US$
    --
    
    
    US$
    --  Audit
Fees  This
category consists of fees for professional services rendered by our principal independent registered public accountant for the
audit of our annual financial statements, review of financial statements included in our interim reports and services that are
normally provided by the independent registered public accounting firms in connection with statutory and regulatory filings or
engagements for those fiscal years.  80     Audit-Related
Fees  This
category consists of fees for assurance and related services by our principal independent registered public accountant that are
reasonably related to the performance of the audit or review of our financial statements and are not reported above under "Audit
Fees". The services for the fees disclosed under this category include consultations concerning financial accounting and
reporting standards.  Tax
Fees  This
category consists of fees for professional services rendered by our principal independent registered public accountant for tax
compliance, tax advice, and tax planning.  All
Other Fees  This
category consists of fees for services provided by our principal independent registered public accountant other than the services
described above.  Policy
on Pre-Approval of Audit Services  The
Audit Committee pre-approves all services, including both audit and non-audit services, provided by our independent registered
public accounting firm. All audit services (including statutory audit engagements as required under local country laws) must be
accepted by the Audit Committee before the audit commences.  Each
year, management and the independent registered public accounting firm will jointly submit a pre-approval request, which will
list each known and/or anticipated audit and non-audit service for the upcoming calendar year and which will include associated
budgeted fees. The Audit Committee will review the requests and approve a list of annual pre-approved non-audit services.   ITEM 16D.
    
    EXEMPTIONS
    FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES Not
applicable.  ITEM 16E.
    
    PURCHASES
    OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS Not
applicable.  ITEM 16F.
    
    CHANGE
    IN REGISTRANT'S CERTIFYING ACCOUNTANT On
December 2, 2015 HKCMCPA Company Limited was appointed as our independent PCAOB audit firm for U.S. reporting purposes. Neither
we, nor anyone on our behalf, consulted HKCMCPA Company Limited ("HKCMCPA") during the two most recent fiscal years
and any subsequent interim period prior the engagement of HKCMCPA regarding any of the matters set forth in Item 16F(a)(2)(i)
and (ii).  ITEM 16G.
    
    CORPORATE
    GOVERNANCE  Not
applicable.  ITEM 16H.
    
    MINE
    SAFETY DISCLOSURES Not
applicable.   81     PART
III  ITEM 17.
    FINANCIAL
    STATEMENTS We
have elected to furnish financial statements and related information specified in Item 18.  ITEM 18.
    FINANCIAL
    STATEMENTS    Integrated Media Technology Limited Integrated
Media Technology Limited Financial
Statements - Index to Consolidated Financial Statements  Report
    of Independent Registered Public Accounting Firm
    F-1Consolidated
    Statements of Profit or Loss and Other Comprehensive (Loss) / Income for the years ended December 31, 2015, 2016 and 2017
    F-2Consolidated
    Statements of Financial Position as of December 31, 2016 and 2017
    F-3Consolidated
    Statements of Changes in Equity for the years ended December 31, 2015, 2016 and 2017
    F-4Consolidated
    Statements of Cash Flows for the years ended December 31, 2015, 2016 and 2017
    F-5Notes
    to the Consolidated Financial Statements
    F-6
    through F-38     82       HKCMCPA Company Limited   REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM  To
                            the Board of Directors and Stockholders of
        Integrated
        Media Technology Limited  Opinion
                            on the Financial Statements
        
        We
        have audited the accompanying consolidated statements of financial position of Integrated Media Technology Limited (the
        "Company") and its subsidiaries (collectively, the "Group") as of December 31, 2017 and 2016,
        and the related consolidated statements of profit or loss and other comprehensive (loss) / income, changes in equity,
        and cash flows for each of the three years in the period ended December 31, 2017, and the related notes (collectively
        referred to as the "consolidated financial statements"). In our opinion, such consolidated financial statements
        present fairly, in all material respects, the financial position of the Group as of December 31, 2017 and 2016, and the
        results of their operations, and their cash flows for each of the three years in the period ended December 31, 2017, in
        conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.  Basis
                            for Opinion
        
        These
        consolidated financial statements are the responsibility of the Group's management. Our responsibility is to express
        an opinion on the Group's consolidated financial statements based on our audits. We are a public accounting firm registered
        with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect
        to the Group in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities
        and Exchange Commission and the PCAOB.
        
        We
        conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
        audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement,
        whether due to error or fraud. The Group is not required to have, nor were we engaged to perform, an audit of its internal
        control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control
        over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Group's internal
        control over financial reporting. Accordingly, we express no such opinion.
        
        Our
        audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements,
        whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining,
        on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also
        included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
        the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis
        for our opinion.   /s/
    HKCMCPA Company LimitedWe
        have served as the Company's auditor since 2016.Hong
    Kong, ChinaMarch
    31, 2018     15/F,
    Aubin House, 171 &172 Gloucester Road, Wanchai, Hong KongTel:
    (852) 2573 2296  Fax: (852) 3015 3860
    http://www.hkcmcpa.us   F-1     INTEGRATED
MEDIA TECHNOLOGY LIMITED CONSOLIDATED
STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE (LOSS) / INCOME (in
Australian dollars, except number of shares)  Years
    ended December 31,Note
    
    2017A$
    
    2016A$
    
    2015A$Revenue,
    net
    
    4
    
    5,762,711
    
    13,929,670
    
    6,379,036Interest
    income
    
    
    
    3,092
    
    2,027
    
    3895,765,803
    
    13,931,697
    
    6,379,425Fair
    value change in contingent consideration liability
    
    28
    
    3,953,537
    
    -
    
    -Gain
    on disposal of financial assets at fair value through profit or loss
    
    5
    
    -
    
    -
    
    507,694Other
    income
    
    6
    
    434,296
    
    107,551
    
    419,58010,153,636
    
    14,039,248
    
    7,306,699ExpensesCost
    of sales
    
    
    
    (2,548,064)
    
    (2,027,743)
    
    (2,984,291)Employee
    benefit expenses
    
    8
    
    (1,887,692)
    
    (1,715,687)
    
    (981,621)Depreciation
    and amortization expenses
    
    8
    
    (2,021,131)
    
    (2,147,231)
    
    (383,635)Loss
    on disposal of a subsidiary
    
    24(d)
    
    -
    
    (872)
    
    -Professional
    and consulting expenses
    
    
    
    (301,732)
    
    (300,576)
    
    (391,444)Travel
    and accommodation expenses
    
    
    
    (333,503)
    
    (431,282)
    
    (59,499)Other
    operating expenses
    
    
    
    (1,448,960)
    
    (1,728,184)
    
    (506,245)Finance
    costs
    
    7
    
    (107,101)
    
    (73,666)
    
    -Total
    expenses
    
    
    
    (8,648,183)
    
    (8,425,241)
    
    (5,306,735)Profit
    before income tax
    
    8
    
    1,505,453
    
    5,614,007
    
    1,999,964Income
    tax credit / (expense)
    
    9
    
    187,213
    
    (2,018,939)
    
    356,158Profit
    for the year
    
    
    
    1,692,666
    
    3,595,068
    
    2,356,122Other
    comprehensive (loss) / incomeItems
    that may be re-classified subsequently to profit or loss:Exchange
    differences on translation of financial statements of overseas subsidiaries
    
    
    
    (657,314)
    
    (326,098)
    
    146,149Other
    comprehensive (loss) / income for the year, net of tax
    
    
    
    (657,314)
    
    (326,098)
    
    146,149Total
    comprehensive income for the year
    
    
    
    1,035,352
    
    3,268,970
    
    2,502,271Profit
    / (loss) for the year attributable to:Equity
    shareholders of Integrated Media Technology Limited
    
    
    
    1,695,567
    
    3,627,757
    
    2,378,276Non-controlling
    interests
    
    
    
    (2,901)
    
    (32,689)
    
    (22,154)1,692,666
    
    3,595,068
    
    2,356,122Total
                                    comprehensive (loss) / income for the year attributable to:Equity
    shareholders of Integrated Media Technology Limited
    
    
    
    1,033,582
    
    3,302,453
    
    2,524,409Non-controlling
    interests
    
    
    
    1,770
    
    (33,483)
    
    (22,138)1,035,352
    
    3,268,970
    
    2,502,271Earnings
    per share
    
    
    
    A$
    
    A$
    
    A$- 
    Basic and Diluted
    
    11
    
    0.64
    
    1.37
    
    1.18  The
above consolidated statements of profit or loss and comprehensive income should be read in conjunction with the accompanying notes.   F-2     INTEGRATED
MEDIA TECHNOLOGY LIMITED CONSOLIDATED
STATEMENTS OF FINANCIAL POSITION (in
Australian dollars, except number of shares)  December
    31,2017
    
    2016A$
    
    A$NoteASSETSCurrent
    AssetsCash
    and bank balances
    
    
    
    2,860,014
    
    1,820,994Inventories
    
    12
    
    1,768,232
    
    1,857,051Trade
    and other receivables
    
    13
    
    3,379,829
    
    8,800,741Other
    assets
    
    14
    
    1,190,295
    
    2,253,915Total
    Current Assets
    
    
    
    9,198,370
    
    14,732,701Non-Current
    AssetsPlant
    and equipment
    
    15
    
    581,317
    
    1,065,635Intangible
    assets and goodwill
    
    16
    
    22,052,310
    
    24,803,096Development
    projects
    
    17
    
    4,027,452
    
    2,880,005Total
    Non-Current Assets
    
    
    
    26,661,079
    
    28,748,736TOTAL
    ASSETS
    
    
    
    35,859,449
    
    43,481,437LIABILITIESCurrent
    LiabilitiesTrade
    and other liabilities
    
    18
    
    830,444
    
    1,654,843Trade
    deposits received
    
    
    
    11,872
    
    99,866Provisions
    
    19
    
    49,166
    
    31,331Amount
    due to ultimate holding company
    
    20
    
    157,492
    
    2,382,707Income
    tax payable
    
    9
    
    1,046,219
    
    1,069,364Borrowings
    
    21
    
    1,609,392
    
    1,231,279Obligation
    under finance lease
    
    22
    
    15,653
    
    -Total
    Current Liabilities
    
    
    
    3,720,238
    
    6,469,390Non-current
    LiabilitiesObligation
    under finance lease
    
    22
    
    51,819
    
    -Deferred
    tax liabilities
    
    9
    
    1,586,309
    
    1,909,030Amount
    due to ultimate holding company
    
    20
    
    15,110,749
    
    -Contingent
    consideration liability
    
    28
    
    -
    
    20,748,035Total
    Non-Current Liabilities
    
    
    
    16,748,877
    
    22,657,065TOTAL
    LIABILITIES
    
    
    
    20,469,115
    
    29,126,455NET
    CURRENT ASSETS
    
    
    
    5,478,132
    
    8,263,311NET
    ASSETS
    
    
    
    15,390,334
    
    14,354,982CAPITAL
    AND RESERVESIssued
    capital (no par value, 2,643,611 ordinary shares issued and outstanding as of December 31, 2017 and 2016)
    
    25
    
    10,410,279
    
    10,410,279Foreign
    currency translation reserve
    
    26
    
    (251,659)
    
    410,326Retained
    earnings
    
    
    
    5,285,565
    
    3,589,998Total
    equity attributable to equity shareholders of Integrated Media Technology Limited
    
    
    
    15,444,185
    
    14,410,603Non-controlling
    interests
    
    
    
    (53,851)
    
    (55,621)TOTAL
    EQUITY
    
    
    
    15,390,334
    
    14,354,982 The
above consolidated statements of financial position should be read in conjunction with the accompanying notes.   F-3     INTEGRATED
MEDIA TECHNOLOGY LIMITED CONSOLIDATED
STATEMENTS OF CHANGES IN EQUITY (in
Australian dollars, except number of shares)  Attributable
    to equity shareholders of the CompanyIssued
    Capital
    
    Accumulated
    Losses
    
    Foreign
    Currency TranslationReserve
    
    Non-controllingInterests
    
    TotalA$
    
    A$
    
    A$
    
    A$
    
    A$Balance
    at January 1, 2015
    
    5,132,475
    
    (2,416,035)
    
    589,497
    
    -
    
    3,305,937Changes
    in equity for 2015:Profit/
    (loss) for the year
    
    -
    
    2,378,276
    
    -
    
    (22,154)
    
    2,356,122Other
    comprehensive income for the year, net of tax
    
    -
    
    -
    
    146,133
    
    16
    
    146,149Total
    comprehensive (loss) / income for the year
    
    -
    
    2,378,276
    
    146,133
    
    (22,138)
    
    2,502,271Issuance
    of new ordinary shares (Note 25(b))
    
    5,277,804
    
    -
    
    -
    
    -
    
    5,277,804Balance
    at December 31, 2015
    
    10,410,279
    
    (37,759)
    
    735,630
    
    (22,138)
    
    11,086,012  Attributable
    to equity shareholders of the CompanyIssued
    Capital
    
    (AccumulatedLosses) / Retained Earnings
    
    Foreign
        Currency
        TranslationReserve
    
    Non-controllingInterests
    
    TotalA$
    
    A$
    
    A$
    
    A$
    
    A$Balance
    at January 1, 2016
    
    10,410,279
    
    (37,759)
    
    735,630
    
    (22,138)
    
    11,086,012Changes
    in equity for 2016:Profit/
    (loss) for the year
    
    -
    
    3,627,757
    
    -
    
    (32,689)
    
    3,595,068Other
    comprehensive loss for the year, net of tax
    
    -
    
    -
    
    (325,304)
    
    (794)
    
    (326,098)Total
    comprehensive (loss) / income for the year
    
    -
    
    3,627,757
    
    (325,304)
    
    (33,483)
    
    3,268,970Balance
    at December 31, 2016
    
    10,410,279
    
    3,589,998
    
    410,326
    
    (55,621)
    
    14,354,982Attributable
    to equity shareholders of the CompanyIssued
    Capital
    
    Retained
    Earnings
    
    Foreign
        Currency
        TranslationReserve
    
    Non-controllingInterests
    
    TotalA$
    
    A$
    
    A$
    
    A$
    
    A$Balance
    at January 1, 2017
    
    10,410,279
    
    3,589,998
    
    410,326
    
    (55,621)
    
    14,354,982Changes
    in equity for 2017:Profit/
    (loss) for the year
    
    -
    
    1,695,567
    
    -
    
    (2,901)
    
    1,692,666Other
    comprehensive loss for the year, net of tax
    
    -
    
    -
    
    (661,985)
    
    4,671
    
    (657,314)Total
    comprehensive (loss) / income for the year
    
    -
    
    1,695,567
    
    (661,985)
    
    1,770
    
    1,035,352Balance
    at December 31, 2017
    
    10,410,279
    
    5,285,565
    
    (251,659)
    
    (53,851)
    
    15,390,334  The
above consolidated statements of changes in equity should be read in conjunction with the accompanying notes.   F-4     INTEGRATED
MEDIA TECHNOLOGY LIMITED CONSOLIDATED
STATEMENTS OF CASH FLOWS (in
Australian dollars, except number of shares)  Years
    Ended December 31,2017
    
    2016
    
    2015Note
    
    A$
    
    A$
    
    A$Cash
    flows from operating activitiesProfit
    before income tax
    
    
    
    1,505,453
    
    5,614,007
    
    1,999,964Adjustments
    to reconcile profit before income tax to net cash provided by / (used in) operating activities:Depreciation
    and amortization
    
    
    
    2,021,131
    
    2,147,231
    
    383,635Fair
    value change in contingent consideration liability
    
    
    
    (3,953,537)
    
    -
    
    -Gain
                                    on disposal of financial assets at fair value through profit or loss
    
    
    
    -
    
    -
    
    (507,694)Net
    cash inflows / (outflows) from changes in working capital
    
    31
    
    5,291,261
    
    (8,970,290)
    
    1,001,290Net
    cash provided by / (used in) operating activities
    
    
    
    4,864,308
    
    (1,209,052)
    
    2,877,195Cash
    flows from investing activitiesProceeds
    from disposal of plant and equipment
    
    
    
    -
    
    -
    
    52,341Proceeds
    from disposal of financial assets at fair value through profit or loss
    
    
    
    -
    
    -
    
    1,121,827Net
    cash acquired from acquisition of subsidiaries
    
    
    
    -
    
    -
    
    871,070Acquisition
    of plant and equipment
    
    
    
    (47,513)
    
    (427,596)
    
    (77,377)Payments
    for intangible assets
    
    
    
    (181,287)
    
    (1,089,357)
    
    -Development
    expenditure
    
    
    
    (1,961,191)
    
    (2,528,308)
    
    (235,268)Net
    cash (used in) / provided by investing activities
    
    
    
    (2,189,991)
    
    (4,045,261)
    
    1,732,593Cash
    flows from financing activitiesRepayment
    of advances to related parties
    
    
    
    (2,003,277)
    
    (891,957)
    
    (90,464)Proceeds
    from bank borrowings
    
    
    
    1,244,925
    
    447,250
    
    -Repayment
    of bank borrowings
    
    
    
    (821,200)
    
    -
    
    -Net
    cash used in financing activities
    
    
    
    (1,579,552)
    
    (444,707)
    
    (90,464)Net
    increase / (decrease) in cash and cash equivalents
    
    
    
    1,094,765
    
    (5,699,020)
    
    4,519,324Effect
    of exchange rate changes on cash and cash equivalents
    
    
    
    (61,658)
    
    (147,211)
    
    136,157Cash
    and cash equivalents at the beginning of financial year
    
    
    
    1,036,965
    
    6,883,196
    
    2,227,715Cash
    and cash equivalents at the end of financial year
    
    
    
    2,070,072
    
    1,036,965
    
    6,883,196Analysis
    of cash and cash equivalents:Cash
    and bank balances
    
    
    
    2,860,014
    
    1,820,994
    
    6,883,196Bank
    overdraft
    
    
    
    (789,942)
    
    (784,029)
    
    -Cash
    and cash equivalents
    
    
    
    2,070,072
    
    1,036,965
    
    6,883,196 The
above consolidated statements of cash flows should be read in conjunction with the accompanying notes.   F-5     INTEGRATED
MEDIA TECHNOLOGY LIMITED NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS (in
Australian dollars, unless otherwise noted)  NOTE
1. REPORTING ENTITY  The
consolidated financial report covers the entity of Integrated Media Technology Limited ("IMT") and its controlled
entities for the years ended December 31, 2017, 2016 and 2015 which were authorized for issue by the Board of Directors on March
31, 2018. IMT is a for-profit public company limited by shares, incorporated and domiciled in Australia whose shares are publicly
traded on the Australian Securities Exchange and Nasdaq. IMT is an investment holding company and its subsidiaries carry out the
business of the Group in Australia, Hong Kong and China.  The
Company and its subsidiaries are referred to as the "Group".  On
May 2, 2017, the Company effected a 1-for-30 reverse split of the ordinary shares, which was approved at a special meeting of
the shareholders on March 2, 2017 and have been retrospectively restated in these financial statements.  On
October 18, 2016, the Company approved to change its name to "Integrated Media Technology Limited".  The
consolidated financial statements of the Group are presented in Australian Dollars ("A$"), unless otherwise stated.  NOTE
2. BASIS OF ACCOUNTING  The
consolidated financial statements are general purpose financial report that have been prepared in accordance with Australian Accounting
Standards ("AASBs"), including Australian Accounting Interpretations, other authoritative pronouncements of the Australian
Accounting Standards Board and the Corporations Act 2001 as appropriate for for-profit entities. The consolidated financial statements
also comply with International Financial Reporting Standards ("IFRSs") as adopted by the International Accounting
Standards Board.  NOTE
3. SIGNIFICANT ACCOUNTING POLICIES  The
following is a summary of the material accounting policies adopted by the Group in the preparation of the consolidated financial
statements. The accounting policies have been consistently applied, unless otherwise stated. (a)Basis of Preparation The
consolidated financial statements have been prepared on the accrual basis and are based on historical costs modified by the revaluation
of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been
applied. (b)Principles
of Consolidation The
consolidated financial statements comprise the financial statements of IMT and its subsidiaries as at December 31, 2017 (the "Group").
Subsidiaries are consolidated from the date on which control is transferred to the Group and are deconsolidated from the date
that control ceases. A list of the controlled entities as at December 31, 2017 is disclosed in Note 23 to the consolidated financial
statements. Other than Marvel Digital Limited, Visumotion International Limited and GOXD Technology Limited, all other controlled
entities have a December 31 statutory financial year end. All
inter-company balances and transactions between entities within the Group, including any unrealized profits or losses, have been
eliminated upon consolidation.  Non-controlling
interest in the results and equity of subsidiaries are shown separately in the consolidated statement of profit or loss and other
comprehensive income and consolidated statement of financial position of the Group. Losses incurred by the Group are attributed
to the non-controlling interest in full, even if that results in a deficit balance. (c)Business
Combination The
Group accounts for business combinations using the acquisition method when control is transferred to the Group. The consideration
transferred by the Company to obtain control of a subsidiary is calculated as the sum of the acquisition-date fair values of assets
transferred, liabilities incurred and the equity interests issued by the Company, which includes the fair value of any asset or
liability arising from a contingent consideration arrangement. Acquisition costs are expensed as incurred, except if related to
the issue of debt or equity securities.   F-6     NOTE
3. SIGNIFICANT ACCOUNTING POLICIES (Continued) (c)Business
Combination (Continued) The
Company recognizes identifiable assets acquired and liabilities assumed in a business combination regardless of whether they have
been previously recognized in the acquiree's financial statements prior to the acquisition. Assets acquired and liabilities
assumed are generally measured at their acquisition-date fair values. Goodwill
is stated after separate recognition of identifiable intangible assets. It is calculated as the excess of the sum of: (a) fair
value of consideration transferred, (b) the recognized amount of any non-controlling interest in the acquire, and (c) acquisition-date
fair value of any existing equity interest in the acquiree, over the acquisition-date fair values of identifiable net assets. Any
contingent consideration to be transferred by the acquirer is recognized at acquisition-date fair value. Subsequent adjustments
to consideration are recognized against goodwill only to the extent that they arise from new information obtained within the measurement
period (a maximum of 12 months from the acquisition date) about the fair value at the acquisition date. All other subsequent adjustments
to contingent consideration classified as an asset or a liability are recognized in profit or loss. (d)Current and deferred income tax Income
tax for the year comprises current tax and movements in deferred tax assets and liabilities. Current tax and movements in deferred
tax assets and liabilities are recognised in profit or loss except to the extent that they relate to items recognised in other
comprehensive income or directly in equity, in which case the relevant amounts of tax are recognised in other comprehensive income
or directly in equity, respectively. Current
tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the end
of the reporting period, and any adjustment to tax payable in respect of previous years. Deferred
tax assets and liabilities arise from deductible and taxable temporary differences respectively, being the differences between
the carrying amounts of assets and liabilities for financial reporting purposes and their tax bases. Deferred tax assets also
arise from unused tax losses and unused tax credits. Apart
from certain limited exceptions, all deferred tax liabilities, and all deferred tax assets to the extent that it is probable that
future taxable profits will be available against which the asset can be utilised, are recognised. Future taxable profits that
may support the recognition of deferred tax assets arising from deductible temporary differences include those that will arise
from the reversal of existing taxable temporary differences, provided those differences relate to the same taxation authority
and the same taxable entity, and are expected to reverse either in the same period as the expected reversal of the deductible
temporary difference or in periods into which a tax loss arising from the deferred tax asset can be carried back or forward. The
same criteria are adopted when determining whether existing taxable temporary differences support the recognition of deferred
tax assets arising from unused tax losses and credits, that is, those differences are taken into account if they relate to the
same taxation authority and the same taxable entity, and are expected to reverse in a period, or periods, in which the tax loss
or credit can be utilised. The
limited exceptions to recognition of deferred tax assets and liabilities are those temporary differences arising from goodwill
not deductible for tax purposes, the initial recognition of assets or liabilities that affect neither accounting nor taxable profit
(provided they are not part of a business combination), and temporary differences relating to investments in subsidiaries to the
extent that, in the case of taxable differences, the Group controls the timing of the reversal and it is probable that the differences
will not reverse in the foreseeable future, or in the case of deductible differences, unless it is probable that they will reverse
in the future. The
carrying amount of a deferred tax asset is reviewed at the end of each reporting period and is reduced to the extent that it is
no longer probable that sufficient taxable profits will be available to allow the related tax benefit to be utilised. Any such
reduction is reversed to the extent that it becomes probable that sufficient taxable profits will be available. Current
tax balances and deferred tax balances, and movements therein, are presented separately from each other and are not offset. Current
tax assets are offset against current tax liabilities, and deferred tax assets against deferred tax liabilities, if the company
or the Group has the legally enforceable right to set off current tax assets against current tax liabilities and the following
additional conditions are met:  (i)in
                                         the case of current tax assets and liabilities, the Group intends either to settle on
                                         a net basis, or to realise the asset and settle the liability simultaneously; or  (ii)in
                                         the case of deferred tax assets and liabilities, if they relate to income taxes levied
                                         by the same taxation authority on either:  -the
                                         same taxable entity; or -different
                                         taxable entities, which, in each future period in which significant amounts of deferred
                                         tax liabilities or assets are expected to be settled or recovered, intend to realize
                                         the current tax assets and settle the current tax liabilities on a net basis or realized
                                         and settle simultaneously.   F-7     NOTE
3. SIGNIFICANT ACCOUNTING POLICIES (Continued) (e)Intangible Assets (i)Acquired
                                         both separately and from a business combination Purchased
intangible assets are initially measured at cost. The cost of an intangible asset acquired in a business combination is its fair
value as at the date of acquisition. Following initial recognition, intangible assets are measured at cost less any accumulated
amortization and any accumulated impairment losses. Intangible assets with finite lives are amortized over the useful life and
assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and
the amortization method for an intangible asset with a finite useful life are reviewed at each financial year end. Intangible
assets, excluding development costs, created within the business are not capitalized and expenditure is charged against profits
in the period in which the expenditure is incurred. (ii)Autostereoscopic
                                         3D display technologies and knowhow The
autostereoscopic 3D display technologies and knowhow acquired in the business combination is measured at fair value as at the
date of acquisition. These costs are amortized over the estimated useful life of 8 years and are tested for impairment where an
indicator of impairment exists. The useful lives are also examined on an annual basis and adjustments, where applicable, are made
on a prospective basis. Please refer to Note 16 for impairment review of these autostereoscopic 3D display technologies and knowhow. (iii)Research
                                         and development costs Development
projects in the consolidated statement of financial position represent the development costs directly attributable to and incurred
for internal technology projects of the Group. An intangible asset arising from development expenditure on an internal technology
project is recognized and included in development projects only when the Group can demonstrate the technical feasibility of completing
the intangible asset or technology so that it will be available for application in existing or new products or for sale, its intention
to complete and its ability to use or sell the asset, how the asset will generate future economic benefits, the availability of
resources to complete the development, the ability to measure reliably the expenditure attributable to the intangible asset during
its development and the ability to use the tangible asset generated. For labor costs, all research and development member salaries
that are directly attributable to the technology project are capitalized. Administrative staff and costs are recognized in the
profit or loss instead of capitalizing this portion of costs. Following the initial recognition of the development expenditure,
the cost model is applied requiring the asset to be carried at cost less any accumulated impairment losses. The amortization rate
of these intangible assets was determined on the basis of the estimated useful life from the time that the relevant asset is taken
into use. (iv)Intellectual
                                         property Expenditure
incurred on patents, trademarks or licenses are capitalized from the date of application. They have a definite useful life and
are carried at cost less accumulated amortization. They are amortized using the straight line method over their estimated useful
lives for a period of 8 to 15 years. (v)Computer
                                         software Acquired
computer software licenses are capitalized on the basis of the costs incurred to acquire and bring to use the specific software.
These costs are amortized over their estimated useful lives ranging (2-5 years). Costs associated with maintaining computer software
programmes are recognized as an expense when incurred. (f)Inventories Finished
goods are stated at the lower of cost and net realizable value on a "first in first out" basis. Cost comprises direct
materials and delivery costs, import duties and other taxes. Costs of purchased inventories are determined after deducting rebates
and discounts received or receivable. Net realizable value is the estimated selling price in the ordinary course of business less
the estimated costs necessary to make the sale. (g)Leases Where
the Group acquires the use of assets under finance leases, the amounts representing the fair value of the leased asset, or, if
lower, the present value of the minimum lease payments, of such assets are recognized as plant and equipment and the corresponding
liabilities, net of finance charges, are recorded as obligations under finance leases. Depreciation is provided at rates which
write off the cost or valuation of the assets over the term of the relevant lease or, where it is likely the Group will obtain
ownership of the asset, the life of the asset, as set out in note 3(k). Impairment losses are accounted for in accordance with
an accounting policy as set out in note 3(h). Finance charges implicit in the lease payments are charged to profit or loss over
the period of the leases so as to produce an approximately constant periodic rate of charge on the remaining balance of the obligations
for each accounting period. Contingent rentals are charged to profit or loss in the accounting period in which they are incurred. Lease
payments for operating lease, where substantially all the risks and benefits remain with the lessor, are charged as expenses on
a straight line basis unless another method is more representative of the pattern to the users benefit.   F-8     NOTE
3. SIGNIFICANT ACCOUNTING POLICIES (Continued) (h)Impairment
of Assets Internal
and external sources of information are reviewed at the end of each reporting period to identify indications that the following
assets may be impaired or, except in the case of goodwill, an impairment loss previously recognised no longer exists or may have
decreased:  -property,
                                         plant and equipment (other than properties carried at revalued amounts); -intangible
                                         assets; and -goodwill. If
any such indication exists, the asset's recoverable amount is estimated. In addition, for goodwill, intangible assets that
are not yet available for use and intangible assets that have indefinite useful lives, the recoverable amount is estimated annually
whether or not there is any indication of impairment. (i)Calculation
                                         of recoverable amount The
recoverable amount of an asset is the greater of its fair value less costs of disposal and value in use. In assessing value in
use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset. Where an asset does not generate cash inflows
largely independent of those from other assets, the recoverable amount is determined for the smallest group of assets that generates
cash inflows independently (i.e. a cash-generating unit). (ii)Recognition
                                         of impairment losses An
impairment loss is recognized in profit or loss if the carrying amount of an asset, or the cash-generating unit to which it belongs,
exceeds its recoverable amount. Impairment losses recognized in respect of cash-generating units are allocated first to reduce
the carrying amount of any goodwill allocated to the cash-generating unit (or group of units) and then, to reduce the carrying
amount of the other assets in the unit (or group of units) on a pro rata basis, except that the carrying value of an asset will
not be reduced below its individual fair value less costs of disposal (if measurable) or value in use (if determinable). (iii)Reversals
                                         of impairment losses In
respect of assets other than goodwill, an impairment loss is reversed if there has been a favorable change in the estimates used
to determine the recoverable amount. An impairment loss in respect of goodwill is not reversed. A
reversal of an impairment loss is limited to the asset's carrying amount that would have been determined had no impairment
loss been recognized in prior years. Reversals of impairment losses are credited to profit or loss in the year in which the reversals
are recognized. (i)Investments
and Other Financial Assets (i)Recognition Financial
instruments are initially measured at costs on trade date, which includes transaction costs, when the related contractual rights
or obligations exist. Subsequent to initial recognition these instruments are measured as set out below. (ii)Financial
                                         assets at fair value through profit and loss A
financial asset is classified in this category if acquired principally for the purpose of selling in the short term or if so designed
by management and within the requirements of IFRS 39: Recognition and Measurement of Financial Instruments. Derivatives are also
categorized as held for trading unless they are designated as hedges. Realized and unrealized gains and losses arising from changes
in the fair value of these assets are recognized in profit or loss in the period in which they arise. (iii)Loans
                                         and receivables Loans
and receivables are non-derivative financial assets with fixed or determined payments that are not quoted in an active market
and are stated at amortized costs using the effective interest rate methods. (iv)Financial
                                         liabilities Non-derivative
financial liabilities are recognized at amortized costs, comprising original debt less principal payments and amortization. (v)Fair
                                         value Fair
value is determined based on current bid prices for all quoted investments. (vi)Impairment At
each reporting date the Group assesses whether there is any objective evidence that a financial instrument has been impaired.
Impairment losses are recognized in profit or loss.   F-9     NOTE
3. SIGNIFICANT ACCOUNTING POLICIES (Continued) (j)Trade
deposits Trade
deposits are payments in advance to suppliers of equipment, products and services, which are initially recognized at fair value
and thereafter stated at amortized cost using the effective interest method less impairment losses, except where the effect of
discounting would be immaterial. (k)Plant
and Equipment Items
of plant and equipment are measured at cost less accumulated depreciation and impairment losses. The
carrying amount of plant and equipment is reviewed annually by the directors to ensure it is not in excess of the recoverable
amount from those assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received
from the asset's employment and subsequent disposal. The expected net cash flows have been discounted to their present values
in determining recoverable amounts. The
depreciable amount of all fixed assets are depreciated over their estimated useful lives to the Group commencing from the time
the assets is held ready for use. Depreciation
is calculated on a straight-line basis to write the net cost of each item of plant and equipment over their expected useful lives.
The depreciation rates used for each class of depreciable assets are generally as follows: Class
                            of fixed assets
Depreciation
rateLeasehold
                                         Improvements
3-5 yearsOffice
                                         Furniture and Equipment
3-5 yearsMotor
                                         Vehicle
5 years Gains
and losses on disposal are determined by deducting the net book value of the assets from the proceeds of sale and are booked to
the profit or loss in the year of disposal. (l)Foreign
Currency Translation (i)Functional
                                         and presentation currency Items
included in the financial statements of each of the Group's entities are measured using the currency of the primary economic
environment in which the entity operates (the "functional currency"). The consolidated financial statements are presented
in Australian Dollars ("A$"), which is the Group's presentation currency. (ii)Transactions
                                         and balances Foreign
currency transactions during the year are translated at the foreign exchange rates ruling at the transaction dates. Monetary assets
and liabilities denominated in foreign currencies are translated at the foreign exchange rates ruling at the end of the reporting
period. Exchange gains and losses are recognized in profit or loss, except those arising from foreign currency borrowings used
to hedge a net investment in a foreign operation which are recognized in other comprehensive income. Non-monetary
assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the foreign exchange
rates ruling at the transaction dates. Non-monetary assets and liabilities denominated in foreign currencies that are stated at
fair value are translated using the foreign exchange rates ruling at the dates the fair value was measured. (iii)Group
                                         companies The
results of foreign operations are translated into Australian Dollars at the exchange rates approximating the foreign exchange
rates ruling at the dates of the transactions. Statement of financial position items, are translated into Australian Dollars at
the closing foreign exchange rates at the end of the reporting period. The resulting exchange differences are recognized in other
comprehensive income and accumulated separately in equity in the exchange reserve. On
disposal of a foreign operation, the cumulative amount of the exchange differences relating to that foreign operation is reclassified
from equity to profit or loss when the profit or loss on disposal is recognized. (m)Trade
and Other Receivables Trade
receivables are recognized at original invoice amounts less an allowance for uncollectible amounts and have repayment terms between
30 and 90 days. Collectability of trade receivables is assessed on an ongoing basis. Debts which are known to be uncollectible
are written off. An allowance is made for doubtful debts where there is objective evidence that the Group will not be able to
collect all amounts due according to the original terms. Objective evidence of impairment includes financial difficulties of the
debtor, default payments or debts more than 30 days overdue. On confirmation that the trade receivable will not be collectible
the gross carrying value of the asset is written off against the associated provision.   F-10     NOTE
3. SIGNIFICANT ACCOUNTING POLICIES (Continued) (n)Trade and Other Payables These
amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year which are unpaid.
The amounts are unsecured and are paid on normal commercial terms. (o)Provisions and contingent liabilities Provisions
are recognized for other liabilities of uncertain timing or amount when the Group has a legal or constructive obligation arising
as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation and
a reliable estimate can be made. Where the time value of money is material, provisions are stated at the present value of the
expenditure expected to settle the obligation. Where
it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation
is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote. Possible obligations,
whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events are also disclosed as
contingent liabilities unless the probability of outflow of economic benefits is remote. (p)Borrowings Borrowings
are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortized cost.
Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over
the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities, which are
not an incremental cost relating to the actual draw-down of the facility, are recognized as prepayments and amortized on a straight-line
basis over the term of the facility. Borrowings
are removed from the statement of financial position when the obligation specified in the contract is discharged, cancelled or
expired. The difference between the carrying amount of the financial liability that has been extinguished or transferred to another
party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in other income
or other expenses. Borrowings
are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at
least 12 months after the end of the reporting period. (q)Borrowing Costs Borrowing
costs that are directly attributable to the acquisition, construction or production of an asset which necessarily takes a substantial
period of time to get ready for its intended use or sale are capitalised as part of the cost of that asset. Other borrowing costs
are expensed in the period in which they are incurred. The
capitalization of borrowing costs as part of the cost of a qualifying asset commences when expenditure for the asset is being
incurred, borrowing costs are being incurred and activities that are necessary to prepare the asset for its intended use or sale
are in progress. Capitalisation of borrowing costs is suspended or ceases when substantially all the activities necessary to prepare
the qualifying asset for its intended use or sale are interrupted or complete. (r)Employee
Benefits (i)Employee
                                         leave entitlements Employee
entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for
annual leave as a result of services rendered by employees up to the date of the statement of financial position. Employee
entitlements to sick leave and maternity leave are not recognised until the time of leave. (ii)Pension
                                         obligations Short
term employee benefits and contributions to defined contribution retirement plans Salaries,
annual bonuses, paid annual leave, contributions to defined contribution retirement plans and the cost of non-monetary benefits
are accrued in the year in which the associated services are rendered by employees. Where payment or settlement is deferred and
the effect would be material, these amounts are stated at their present values. (iii)Termination
                                         benefits Termination
benefits are recognised at the earlier of when the Group can no longer withdraw the offer of those benefits and when it recognises
restructuring costs involving the payment of termination benefits. (s)Cash
and Cash Equivalents Cash
and cash equivalents include cash on hand and call deposits with banks or financial institutions and net of bank overdrafts.   F-11     NOTE
3. SIGNIFICANT ACCOUNTING POLICIES (Continued) (t)Revenue Revenue
comprises the fair value for the sale of products and services, excluding goods and services tax, rebates and discounts. The Company
recognizes revenue when the amount of revenue can be reliably measured when it is probable that future economic benefits will
flow to the entity and when specific criteria have been met for each of the entity's activities. Sale
of products Revenue
from sale of 3D autostereoscopic displays, conversion equipment, software, technology solutions and related 3D products is recognised
when the significant risks and rewards of ownership have passed to the buyer and can be reliably measured. Risks and rewards are
considered passed to the buyer when goods have been delivered to the customer. For the products which are technically innovative,
highly customised or require complex installation, revenue is recognised when the customer has completed its acceptance procedures. Sale
of Services Sales
of services are recognized in the accounting period in which the services are rendered by reference to completion of the specific
transaction assessed on the basis of the actual service provided as proportion of the total services to be provided. Interest
Income Revenue
is recognized as interest accrues using the effective interest method. (u)Sales
Taxes Revenues,
expenses and assets are recognized net of the amount of goods and services tax ("GST") or valued-added tax ("VAT"),
except where the amount of GST or VAT incurred is not recoverable from the Australian Taxation Office or taxation authorities
in other jurisdictions. In these circumstances, the GST or VAT is recognized as part of the cost of acquisition of the assets
or as part of an item of expense. Receivables and payables in the consolidated statement of financial position are shown inclusive
of GST or VAT. Cash
flows are included in the consolidated statement of cash flows on a gross basis and the GST or VAT component of cash flows arising
from investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating
cash flows. (v)Earnings Per Share (i)Basic
earnings per share Basic
earnings per share is calculated by dividing the profit attributable to equity holders of the Company, excluding any costs of
servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial
year, adjusted for bonus elements in ordinary shares issued during the year. (ii)Diluted
earnings per share Diluted
earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income
tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number
of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares. (w)Issued Capital Ordinary
shares are classified as equity. Incremental
costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
Incremental costs directly attributable to the issue of new shares or options for the acquisition of a business are not included
in the cost of the acquisition as part of the purchase consideration.   F-12     NOTE
3. SIGNIFICANT ACCOUNTING POLICIES (Continued) (x)Related
parties For
the purpose of these consolidated financial statements, related party includes a person and entity as defined below: (i)A
                                         person, or a close member of that person's family, is related to the Group if that
                                         person: (i)has
                                         control or joint control over the Group; (ii)has
                                         significant influence over the Group; or (iii)is
                                         a member of the key management personnel of the Group or the Group's parent. (ii)An
                                         entity is related to the Group if any of the following conditions applies: (i)the
                                         entity and the Group are members of the same group (which means that each parent, subsidiary
                                         and fellow subsidiary is related to the others). (ii)one
                                         entity is an associate or joint venture of the other entity (or an associate or joint
                                         venture of a member of a group of which the other entity is a member). (iii)both
                                         entities are joint ventures of the same third party. (iv)one
                                         entity is a joint venture of a third entity and the other entity is an associate of the
                                         third entity. (v)the
                                         entity is a post-employment benefit plan for the benefit of employees of either the Group
                                         or an entity related to the Group. (vi)the
                                         entity is controlled or jointly controlled by a person identified in (i). (y)Fair
Value Fair
values may be used for financial asset and liability measurement and for sundry disclosures. Fair
value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. It is based on the presumption that the transaction takes place either in the principal
market for the asset or liability or, in the absence of a principal market, in the most advantageous market. The principal or
most advantageous market must be accessible to, or by, the Group. Fair
value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that
market participants act in their best economic interest. The
fair value measurement of a non-financial asset takes into account the market participant's ability to generate economic benefits
by using the asset at its highest and best use or by selling it to another market participant that would use the asset at its
highest and best use. In
measuring fair value, the Group uses valuation techniques that maximize the use of observable inputs and minimize the use of unobservable
inputs. (z)New,
Revised or Amending Accounting Standards and Interpretations (i)New
                                         and revised IFRSs that have been issued and effective The
following standards have been adopted by the Group for the first time for the year ended 31 December 2017:  ·Amendments
                                         to IAS 7 "Disclosure initiative" ·Amendments
                                         to IAS 12 "Recognition of deferred tax assets for unrealized losses" ·Annual
                                         improvements to IFRS 2014-2016 cycle "Amendments to IFRS 12" The
application of the above amendments to IFRSs and IAS in the current year has had no material impact on the Group's financial
performance and positions for the current and prior years and/or on the disclosures set out in these consolidated financial statements.   F-13     NOTE
3. SIGNIFICANT ACCOUNTING POLICIES (Continued) (z)New,
Revised or Amending Accounting Standards and Interpretations (Continued) (ii)New
                                         and revised IFRSs that have been issued but are not yet effective The
following new and revised IFRSs, potentially relevant to the Group's operations, have been issued and are mandatory for
adoption by the Group for accounting periods beginning on or after 1 January 2018 or later periods. However, the Group has not
early adopted them.  ·Amendments
                                         to IFRS 2 "Classification and measurement of share-based payment transactions"
                                         1·Amendments
                                         to IFRS 4 "Applying IFRS 9 Financial Instruments with IFRS 4 Insurance Contracts"
                                         1·IFRS
                                         9 "Financial instruments"1·Amendments
                                         to IFRS 9 "Prepayment features with negative compensation"2·Amendment
                                         to IFRS 10 and IAS 28 (2011) "Sale or contribution of assets between and investor
                                         and its associateor joint venture"4·IFRS
                                         15 "Revenue from contracts with customers"1·Amendments
                                         to IFRS 15 "Clarification to IFRS 15 Revenue from contracts with customers"
                                         1·IFRS
                                         16 "Leases"2·IFRS
                                         17 "Insurance contracts"3·Amendments
                                         to IAS 40 "Transfers of investment property"1·IFRIC
                                         22 "Foreign currency transactions and advance consideration"1·IFRIC
                                         23 "Uncertainty over income tax treatments"2·Annual
                                         improvements 2014-2016 cycle " Amendments to IFRS 1 and IAS 28"1·Annual
                                         improvements to IFRS 2015-2017 cycle 2 The
Group has not applied any new or revised IFRSs that are not yet effective for the year ended 31 December 2017.  1Effective for annual periods beginning on or after 1 January 2018 2Effective for annual periods beginning on or after 1 January 2019 (aa)Critical
Accounting Judgments, Estimates and Assumptions The
preparation of the consolidated financial statements requires management to make judgments, estimates and assumptions that affect
the reported amounts in the consolidated financial statements. Management continually evaluates its judgments and estimates in
relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgments, estimates and assumptions
on historical experience and on other various factors, including expectations of future events, management believes to be reasonable
under the circumstances. The resulting accounting judgments and estimates will seldom equal the related actual results. The judgments,
estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below: (i)Goodwill
                                         and other intangible assets The
goodwill included in the consolidated financial statements was arised from the acquisition of Marvel Digital Limited. Determining
whether goodwill is impaired requires as estimation of the value in use of the cash generating unit ("CGU") to which
goodwill have been allocated. The value in use calculation requires the Group to estimate the future cash flows expected to arise
from the CGU and a suitable discount rate in order to calculate the present value. Where the actual future cash flows are less
than expected, a material impairment loss may arise. At the end of the reporting year, the carrying amount of goodwill is A$13,061,371
(2016: A$14,256,751). Details of the recoverable amount calculations are disclosed in Note 16 . (ii)Valuation
                                         of contingent consideration The
contingent consideration to be transferred by the acquirer is recognized at acquisition-date fair value. The fair value of contingent
consideration was based on an independent valuation which is determined by using the discounted cash flow method on the probability-weighted
financial projection of MDL for the period from October 1, 2015 to September 30, 2017 and is under level 3 fair value adjustment
which involve significant estimates and judgements from the management. There was no more contingent consideration as at December
31, 2017 as the Company recognized the actual deferred performance fee to be paid to MFL of A$15,110,749.   F-14     NOTE
3. SIGNIFICANT ACCOUNTING POLICIES (Continued) (aa)Critical
Accounting Judgments, Estimates and Assumptions (continued) (iii)Provision
                                         for impairment of receivables The
provision for impairment of receivables assessment requires a degree of estimation and judgment. The level of provision is assessed
by taking into account the recent sales experience, the ageing of receivables, historical collection rates and specific knowledge
of the individual debtor's financial position. Refer to Note 13 for further details. (iv)Estimation
                                         of useful lives of assets The
Group determines the estimated useful lives and related depreciation and amortization charges for its plant and equipment and
finite life intangible assets. The useful lives could change significantly as a result of technical innovations or some other
events. The depreciation and amortization charge will increase where the useful lives are less than previously estimated lives,
or technically obsolete or non-strategic assets that have been abandoned or sold will be written off or written down. Please refer
to Note 3(e) and 3(k) for further details. (v)Income
                                         tax The
Group is subject to income taxes in the jurisdictions in which it operates. Significant judgment is required in determining the
provision for income tax and in assessing whether deferred tax assets and certain deferred tax liabilities are recognized in the
consolidated statement of financial position. Deferred tax assets, including those arising from unrecouped tax losses, capital
losses and temporary differences, are recognized only where it is considered more likely than not that they will be recovered,
which is dependent on the generation of sufficient future taxable profits. Assumptions about the generation of future taxable
profits depend on management's estimates of future cash flows. In addition, there are many transactions and calculations
undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Group recognizes
liabilities for anticipated tax audit issues based on the Group's current understanding of the tax law. Where the final
tax outcome of these matters is different from the carrying amounts, such differences will impact the current and deferred tax
provisions in the period in which such determination is made. Judgements
are also required about the application of income tax legislation. These judgements and 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 deferred tax liabilities recognized in the statement of financial position and the amount of other tax losses and temporary
differences not yet recognized. In such circumstances, some or all of the carrying amounts of recognized deferred tax assets and
liabilities may require adjustments, resulting in a corresponding credit or charge to the statement of comprehensive income. (vi)Capitalized
                                         technology development expenditure in intangibles In
determining which technology development expenditure may be capitalized the Group applies judgement to distinguish those costs
which have a direct relationship to the criteria for capitalization described in accounting policy Note 3(e), from those which
should be expensed in the period incurred. This involves evaluating the nature of work performed by staff as well as universities,
educational and professional institutions, third party consultants and contractors, and in many cases includes a judgemental apportionment
of costs. (vii)Impairment
                                         of non-financial assets The
Group assesses impairment of all assets (including intangible assets) at each reporting date by evaluating conditions specific
to the Group and to the particular asset that may lead to impairment. These include product, technology, economic and political
environments and future product expectations. If an impairment trigger exists the recoverable amount of the asset is determined.
Given the current uncertain economic environment management considered that the indicators of impairment were significant enough
and as such these assets have been tested for impairment in this financial period. Refer to Note 3(h) for details regarding the
method and assumptions used.   F-15     NOTE
4. REVENUE AND SEGMENT INFORMATION  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Development,
    sales and distribution of 3D autostereoscopic products and conversion equipment
    
    4,365,364
    
    4,726,500
    
    4,705,743Sales
    of software and technology solutions
    
    1,180,491
    
    9,085,792
    
    -Sales
    and distribution of audio products
    
    54,251
    
    111,045
    
    1,563,987Provision
    of consultancy and other services
    
    162,605
    
    6,333
    
    109,3065,762,711
    
    13,929,670
    
    6,379,036 Operating
segments have been determined on the basis of reports reviewed by the executive director. The executive director is considered
to be the chief operating decision maker of the Group. The executive director considers that the Group has assessed and allocated
resources on this basis. The executive director considers that the Group has four operating segments for the year ended December
31, 2017 (2016: four and 2015: four), being (1) the development, sale and distribution of autostereoscopic 3D displays, conversion
equipment, software and others, (2) sale and distribution of audio products, (3) provision of consultancy services and (4) corporate. Segment
information for the reporting period is as follows:  For
    the year ended December 31, 2017
    
    Development,
    sale and distribution of 3D displays, conversion equipment, software and othersA$
    
    Sales
    and distribution of audio productsA$
    
    Consultancy
    servicesA$
    
    CorporateA$
    
    TotalA$RevenueRevenue,
    net
    
    5,708,460
    
    54,251
    
    -
    
    -
    
    5,762,711Interest
    income
    
    3,030
    
    -
    
    -
    
    62
    
    3,092Fair
    value change in contingent consideration liability
    
    -
    
    -
    
    -
    
    3,953,537
    
    3,953,537Other
    income
    
    434,296
    
    -
    
    -
    
    -
    
    434,296Segment
    Revenue
    
    6,145,786
    
    54,251
    
    -
    
    3,953,599
    
    10,153,636Cost
    of sales
    
    2,506,037
    
    42,027
    
    -
    
    -
    
    2,548,064Employee
    benefit expenses
    
    1,681,123
    
    5,831
    
    134,415
    
    66,323
    
    1,887,692Depreciation
    and amortization expenses
    
    1,937,133
    
    1,001
    
    79,930
    
    3,067
    
    2,021,131Professional
    and consulting expenses
    
    36,482
    
    1,913
    
    11,808
    
    251,529
    
    301,732Travel
    and accommodation expenses
    
    285,693
    
    6,376
    
    1,508
    
    39,926
    
    333,503Other
    operating expenses
    
    1,184,595
    
    18,626
    
    17,768
    
    227,971
    
    1,448,960Finance
    costs
    
    107,101
    
    -
    
    -
    
    -
    
    107,101Segment
    expenses
    
    7,738,164
    
    75,774
    
    245,429
    
    588,816
    
    8,648,183Segment
    operating (loss) / profit
    
    (1,592,378)
    
    (21,523)
    
    (245,429)
    
    3,364,783
    
    1,505,453Segment
    assets 2017
    
    16,868,789
    
    73,130
    
    57,923
    
    18,859,607
    
    35,859,449Segment
    liabilities 2017
    
    4,615,366
    
    76,731
    
    (587,484)
    
    16,364,502
    
    20,469,115   F-16     NOTE
4. REVENUE AND SEGMENT INFORMATION (Continued)  For
    the year ended December 31, 2016
    
    Development,
    sale and distribution of 3D displays, conversion equipment, software and othersA$
    
    Sales
    and distribution of audio productsA$
    
    Consultancy
    servicesA$
    
    CorporateA$
    
    TotalA$RevenueRevenue,
    net
    
    13,818,418
    
    111,045
    
    207
    
    -
    
    13,929,670Interest
    income
    
    1,856
    
    11
    
    6
    
    154
    
    2,027Other
    income
    
    100,374
    
    7,177
    
    -
    
    -
    
    107,551Segment
    Revenue
    
    13,920,648
    
    118,233
    
    213
    
    154
    
    14,039,248Cost
    of sales
    
    1,928,904
    
    97,504
    
    1,335
    
    -
    
    2,027,743Employee
    benefit expenses
    
    1,002,040
    
    44,822
    
    611,825
    
    57,000
    
    1,715,687Depreciation
    and amortization expenses
    
    2,035,365
    
    14,322
    
    97,544
    
    -
    
    2,147,231Loss
    on disposal of a subsidiary
    
    -
    
    -
    
    -
    
    872
    
    872Professional
    and consulting expenses
    
    129,636
    
    1,813
    
    56,653
    
    112,474
    
    300,576Travel
    and accommodation expenses
    
    352,926
    
    5,924
    
    39,470
    
    32,962
    
    431,282Other
    operating expenses
    
    1,414,558
    
    112,449
    
    87,152
    
    114,025
    
    1,728,184Finance
    costs
    
    73,666
    
    -
    
    -
    
    -
    
    73,666Segment
    expenses
    
    6,937,095
    
    276,834
    
    893,979
    
    317,333
    
    8,425,241Segment
    operating profit / (loss)
    
    6,983,553
    
    (158,601)
    
    (893,766)
    
    (317,179)
    
    5,614,007Segment
    assets 2016
    
    21,117,152
    
    73,108
    
    297,280
    
    21,993,897
    
    43,481,437Segment
    liabilities 2016
    
    6,811,574
    
    17,453
    
    174,182
    
    22,123,246
    
    29,126,455  For
    the year ended December 31, 2015
    
    Development,
    sale and distribution of 3D displays, conversion equipment, software and othersA$
    
    Sales
    and distribution of audio productsA$
    
    Consultancy
    and other servicesA$
    
    CorporateA$
    
    TotalA$RevenueRevenue
    from operating activities
    
    4,749,789
    
    1,559,199
    
    65,260
    
    4,788
    
    6,379,036Interest
    income
    
    -
    
    -
    
    349
    
    40
    
    389Gain
    on disposal of financial assets
    
    -
    
    -
    
    -
    
    507,694
    
    507,694Other
    income
    
    260,336
    
    159,244
    
    -
    
    -
    
    419,580Segment
    Revenue
    
    5,010,125
    
    1,718,443
    
    65,609
    
    512,522
    
    7,306,699Cost
    of sales
    
    1,716,370
    
    1,263,707
    
    -
    
    4,214
    
    2,984,291Employee
    benefit expenses
    
    161,521
    
    266,826
    
    547,600
    
    5,674
    
    981,621Depreciation
    and amortization expenses
    
    187,236
    
    76,771
    
    119,628
    
    -
    
    383,635Professional
    and consulting expenses
    
    -
    
    52,804
    
    287,640
    
    51,000
    
    391,444Travel
    and accommodation expenses
    
    27,799
    
    4,933
    
    17,920
    
    8,847
    
    59,499Other
    operating expenses
    
    287,788
    
    10,950
    
    62,852
    
    144,655
    
    506,245Segment
    expenses
    
    2,380,714
    
    1,675,991
    
    1,035,640
    
    214,390
    
    5,306,735Segment
    operating profit / (loss)
    
    2,629,411
    
    42,452
    
    (970,031)
    
    298,132
    
    1,999,964Segment
    assets 2015
    
    20,674,571
    
    166,863
    
    2,080,392
    
    14,349,641
    
    37,271,467Segment
    liabilities 2015
    
    5,214,794
    
    2,740
    
    78,583
    
    20,889,338
    
    26,185,455 The
geographic information analyses the Group's revenue and non-current assets by the Company's country of domicile and
other countries. In presenting the geographic information, segment revenue has been based on the geographic location of customers
and segment assets were based on the geographic location of the assets.   F-17     NOTE
4. REVENUE AND SEGMENT INFORMATION (Continued) Revenue
by geographic location The
Group's operations are located in the PRC and Hong Kong. The following table provides an analysis of the Group's sales
by geographical markets based on locations of customers: ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Australia
    
    -
    
    -
    
    4,788Hong
    Kong
    
    3,235,872
    
    5,507,684
    
    1,184,922China
    
    2,526,839
    
    8,421,986
    
    5,189,3265,762,711
    
    13,929,670
    
    6,379,036  Non-current
assets by geographic location ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Australia
    
    13,062,904
    
    14,256,752
    
    14,307,935Hong
    Kong
    
    12,384,224
    
    13,026,972
    
    13,060,229China
    
    1,213,951
    
    1,465,012
    
    540,52126,661,079
    
    28,748,736
    
    27,908,685 Major
customers For
the year ended December 31, 2017, the Group has five individual customers (2016 and 2015: 5 and 4 respectively) with revenues
comprising more than 10% of Group's revenues and their respective receivables due from these customers are disclosed below:  31
    December 2017
    
    31
    December 2016
    
    31
    December 2015Percentage
    of Revenue
    
    Balance
                           due
        A$
    
    Percentage
    of Revenue
    
    Balance
                           due
        A$
    
    Percentage
    of Revenue
    
    Balance
                           due
        A$Customer
    A
    
    20%
    
    -
    
    -
    
    -
    
    -
    
    -Customer
    B
    
    14%
    
    521,334
    
    -
    
    -
    
    -
    
    -Customer
    C
    
    13%
    
    802,009
    
    -
    
    -
    
    -
    
    -Customer
    D
    
    11%
    
    9,029
    
    12%
    
    378,673
    
    -
    
    -Customer
    E
    
    10%
    
    50,717
    
    -
    
    -
    
    -
    
    -Customer
    F
    
    -
    
    -
    
    37%
    
    5,309,526
    
    -
    
    -Customer
    G
    
    -
    
    -
    
    15%
    
    -
    
    -
    
    -Customer
    H
    
    -
    
    -
    
    12%
    
    1,301,381
    
    -
    
    -Customer
    I
    
    -
    
    -
    
    10%
    
    299,046
    
    -
    
    -Customer
    J
    
    -
    
    -
    
    
    
    
    
    26%
    
    138,147Customer
    K
    
    -
    
    -
    
    -
    
    -
    
    21%
    
    182,744Customer
    L
    
    -
    
    -
    
    -
    
    -
    
    20%
    
    -Customer
    M
    
    -
    
    -
    
    -
    
    -
    
    10%
    
    -   F-18     NOTE
5. GAIN ON DISPOSAL OF FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS  The
gain on disposal of financial assets for the year ended December 31, 2015 represented the sales of our investment in the ordinary
shares of a company quoted on the OTC Market in the United States. As at December 31, 2016 and 2017, the Group did not hold any
financial assets at fair value through profit or loss.   NOTE
6. OTHER INCOME  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Design
    services income
    
    -
    
    -
    
    159,244Government
    grant
    
    426,281
    
    88,387
    
    -Sundry
    income
    
    8,015
    
    19,164
    
    260,336434,296
    
    107,551
    
    419,580   NOTE
7. FINANCE COSTS  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Bank
    overdraft and borrowing interest
    
    42,285
    
    1,245
    
    -Interest
    on finance lease liability
    
    3,750
    
    -
    
    -Interest
    charged by the ultimate holding company
    
    61,066
    
    72,421
    
    -107,101
    
    73,666
    
    -   NOTE
8. PROFIT BEFORE INCOME TAX  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Employee
    benefit expenses:-
    Wages and salaries
    
    2,479,754
    
    2,505,964
    
    1,061,471-
    Defined contribution superannuation plan expenses
    
    106,414
    
    86,515
    
    20,641-
    Less: Labor cost allocated to development projects
    
    (764,476)
    
    (925,792)
    
    (132,947)-
    Non-executive directors' remuneration
    
    66,000
    
    49,000
    
    32,456Total
    employee benefit expenses
    
    1,887,692
    
    1,715,687
    
    981,621Depreciation
    and amortization of non-current assets:-
    Office furniture and equipment
    
    304,262
    
    382,789
    
    207,891-
    Leasehold improvements
    
    222,015
    
    360,778
    
    170,220-
    Motor vehicle
    
    11,087
    
    -
    
    --
    Intangible assets
    
    1,483,767
    
    1,403,664
    
    5,524Total
    depreciation and amortization
    
    2,021,131
    
    2,147,231
    
    383,635   F-19     NOTE
8. PROFIT BEFORE INCOME TAX (Continued)  ConsolidatedDecember 31,
    2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Rental
    expense on operating lease
    
    407,184
    
    370,423
    
    155,365-
    Auditors'     remuneration for:-
    Audit     and review of financial statements:-
    statutory auditor of the Group in Australia
    
    64,000
    
    37,500
    
    29,499-
    auditors of the subsidiaries in Hong Kong and China
    
    4,097
    
    1,627
    
    2,077-
    auditor of the Group for PCAOB audit
    
    123,638
    
    7,105
    
    42,092191,735
    
    46,232
    
    73,668 NOTE
9. INCOME TAX CREDIT / (EXPENSE)  ConsolidatedDecember 31,
    2017A$
    
    December 31,
    2016A$
    
    December 31,
    2015A$Current
    tax expense
    
    -
    
    (1,052,266)
    
    -Deferred
    tax benefit / (expense)
    
    187,213
    
    (966,673)
    
    356,158Income
    tax credit / (expense)
    
    187,213
    
    (2,018,939)
    
    356,158  (a)The
                                         prima-facie tax on profit before income tax is reconciled to the income tax credit /
                                         (expense) as follows:  ConsolidatedDecember 31,
    2017A$
    
    December
    31, 2016A$
    
    December 31,
    2015A$Numerical
    reconciliation of income tax expense to prima facie tax payableProfit
    before income tax
    
    1,505,453
    
    5,614,007
    
    1,999,964Income
    tax expense on profit before income tax at 30%
    
    (451,636)
    
    (1,684,202)
    
    (599,989)Difference
    in overseas tax rates
    
    27,266
    
    312,313
    
    119,654Add
    / (less) the tax effect of:Recognition
    of tax effect of previously unrecognized tax losses and temporary differences
    
    -
    
    -
    
    1,059,090Utilization
    of previously unrecognized tax losses
    
    -
    
    -
    
    594,049Utilization
    of tax losses during the year
    
    -
    
    (500,971)
    
    -Tax
                                    losses and temporary differences for the year for which no
        deferred
        tax is recognized
    
    611,583
    
    (146,079)
    
    (816,646)Income
    tax credit / (expense)
    
    187,213
    
    (2,018,939)
    
    356,158 (b)Deferred
                                         tax assets / (liabilities) arising from temporary differences and unused tax losses can
                                         be summarized as follows: ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Balance
    brought forward
    
    (1,909,030)
    
    (933,853)Accelerated
    depreciation allowances
    
    (46,621)
    
    (501,510)Temporary
    differences on disposed intangible assets
    
    -
    
    35,808Future
    benefit of tax losses
    
    233,426
    
    (500,971)Exchange
    difference
    
    135,916
    
    (8,504)Total
    
    (1,586,309)
    
    (1,909,030)  F-20     NOTE
9. INCOME TAX CREDIT / (EXPENSE) (Continued) (c)Income
                                         tax payable in the consolidated statement of financial position represents: ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Balance
    brought forward
    
    (1,069,364)
    
    -Provision
    for income tax for the year
    
    -
    
    (1,052,266)Exchange
    difference
    
    23,145
    
    (17,098)Total
    
    (1,046,219)
    
    (1,069,364)  NOTE
10. DIVIDENDS  No
dividends were declared and paid during the financial year (2016 and 2015: Nil).  NOTE
11. EARNINGS PER SHARE  ConsolidatedDecember 31,
    2017A$
    
    December 31,
    2016A$
    
    December 31,
    2015A$Profit
    after income tax attributable to shareholders
    
    1,695,567
    
    3,627,757
    
    2,378,276Number
    of ordinary shares
    
    2,643,611
    
    2,643,611
    
    2,643,611Weighted
    average number of ordinary shares on issue
    
    2,643,611
    
    2,643,611
    
    1,922,143Basic
    and diluted earnings per share
    
    64
    cents
    
    137
    cents
    
    118
    cents The above number of shares and earnings per share in 2016 and 2015 have been adjusted for the
30-for-1 reverse stock split effective on May 8, 2017. NOTE
12. INVENTORIES Inventories
consist of the following:  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Raw
    materials
    
    
    
    1,019,954
    
    948,491Finished
    goods – displays and other products
    
    
    
    748,278
    
    996,746Provision
    for inventories obsolescence
    
    
    
    -
    
    (88,186)Total,
    net of allowance for inventories
    
    
    
    1,768,232
    
    1,857,051   NOTE
13. TRADE AND OTHER RECEIVABLES  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Trade
    receivables
    
    
    
    2,489,235
    
    8,612,576Other
    receivables
    
    
    
    134,009
    
    5,787Amounts
    due from related companies
    
    
    
    756,585
    
    182,3783,379,829
    
    8,800,741Less:
    Allowances for doubtful debts
    
    
    
    -
    
    -3,379,829
    
    8,800,741   F-21     NOTE
13. TRADE AND OTHER RECEIVABLES (Continued) (a)	Ageing
Analysis The
ageing analysis of trade receivables is as follows:  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016,A$Current
    
    
    
    617,346
    
    7,897,623Past
    due<
    31 days
    
    
    
    244,004
    
    -31
    -90 days
    
    
    
    95,277
    
    ->
    91 days
    
    
    
    1,532,608
    
    714,9531,871,889
    
    714,9532,489,235
    
    8,612,576  (b)
	Trade receivables which are past due but not impaired Included
in the Group's trade receivable balance are debtors with an aggregate carrying amount of A$1,871,889 (2016: A$714,953) which
are past due at the end of the reporting period for which the Group has not made provision for impairment loss.  The
carrying value of trade receivables is considered reasonable approximation of fair value to the short term nature of the balance. The
maximum exposure to credit risk at the reporting date is the fair value of each class of receivables in the consolidated financial
statements. Refer to Note 29(e) for further details of credit risk management. NOTE
14. OTHER ASSETS ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Prepayments
    
    
    
    106,815
    
    280,325Trade
    deposits
    
    
    
    850,845
    
    1,819,648Other
    deposits
    
    
    
    228,753
    
    151,869GST
    receivable
    
    
    
    3,882
    
    2,0731,190,295
    
    2,253,915  F-22     NOTE
15. PLANT AND EQUIPMENT ConsolidatedLeasehold
    ImprovementsA$
    
    Office
    Furniture and EquipmentA$
    
    Motor
    VehicleA$
    
    TotalA$At
    January 1, 2016Cost
    
    
    
    1,431,503
    
    1,820,788
    
    -
    
    3,252,291Accumulated
    depreciation
    
    
    
    (464,807)
    
    (1,114,782)
    
    -
    
    (1,579,589)Net
    book amount
    
    
    
    966,696
    
    706,006
    
    -
    
    1,672,702Year
    ended December 31, 2016Opening
    net book amount
    
    
    
    966,696
    
    706,006
    
    -
    
    1,672,702Additions
    
    
    
    963
    
    426,633
    
    -
    
    427,596Disposals
    
    
    
    (125,322)
    
    (53,065)
    
    -
    
    (178,387)Depreciation
    expense
    
    
    
    (360,778)
    
    (382,789)
    
    -
    
    (743,567)Written
    off
    
    
    
    -
    
    (67,089)
    
    -
    
    (67,089)Exchange
    difference
    
    
    
    (20,406)
    
    (25,214)
    
    -
    
    (45,620)Closing
    Net book amount
    
    
    
    461,153
    
    604,482
    
    -
    
    1,065,635At
    December 31, 2016Cost
    
    
    
    1,239,520
    
    2,003,660
    
    -
    
    3,243,180Accumulated
    depreciation
    
    
    
    (778,367)
    
    (1,399,178)
    
    -
    
    (2,177,545)Net
    book amount
    
    
    
    461,153
    
    604,482
    
    -
    
    1,065,635Year
    ended December 31, 2017Opening
    net book amount
    
    
    
    461,153
    
    604,482
    
    -
    
    1,065,635Additions
    
    
    
    -
    
    32,403
    
    85,129
    
    117,532Depreciation
    expense
    
    
    
    (222,015)
    
    (304,262)
    
    (11,087)
    
    (537,364)Exchange
    difference
    
    
    
    (33,554)
    
    (28,230)
    
    (2,702)
    
    (64,486)Closing
    net book amount
    
    
    
    205,584
    
    304,393
    
    71,340
    
    581,317  At
    December 31, 2017Cost
    
    
    
    1,143,329
    
    1,905,962
    
    82,315
    
    3,131,606Accumulated
    depreciation
    
    
    
    (937,745)
    
    (1,601,569)
    
    (10,975)
    
    (2,550,289)Net
    book amount
    
    
    
    205,584
    
    304,393
    
    71,340
    
    581,317   F-23     NOTE
16. INTANGIBLE ASSETS AND GOODWILL GoodwillA$
    
    Autostereoscopic
    3D Display Technologies and KnowhowA$
    
    Patents
    and TrademarkA$
    
    Software
    and LicenceA$
    
    TotalA$CostAt
    January 1, 2016
    
    14,307,935
    
    11,164,603
    
    41,545
    
    36,968
    
    25,551,051Additions
    
    -
    
    89,528
    
    999,829
    
    -
    
    1,089,357Disposal
    
    -
    
    (302,966)
    
    -
    
    -
    
    (302,966)Exchange
    difference
    
    (51,184)
    
    (57,184)
    
    13,800
    
    (2,583)
    
    (97,151)At
    December 31, 2016
    
    14,256,751
    
    10,893,981
    
    1,055,174
    
    34,385
    
    26,240,291At
    January 1, 2017
    
    14,256,751
    
    10,893,981
    
    1,055,174
    
    34,385
    
    26,240,291Additions
    
    -
    
    -
    
    181,287
    
    -
    
    181,287Reclassification
    
    -
    
    487,555
    
    -
    
    -
    
    487,555Exchange
    difference
    
    (1,195,380)
    
    (928,032)
    
    (19,834)
    
    (1,008)
    
    (2,144,254)At
    31 December 31, 2017
    
    13,061,371
    
    10,453,504
    
    1,216,627
    
    33,377
    
    24,764,879Accumulated
    Amortization and Impairment LossesAt
    January 1, 2016
    
    -
    
    -
    
    -
    
    (5,957)
    
    (5,957)Amortisation
    
    -
    
    (1,354,273)
    
    (32,473)
    
    (16,918)
    
    (1,403,664)Disposal
    
    -
    
    37,871
    
    -
    
    -
    
    37,871Exchange
    difference
    
    -
    
    (65,853)
    
    (579)
    
    987
    
    (65,445)At
    December 31, 2016
    
    -
    
    (1,382,255)
    
    (33,052)
    
    (21,888)
    
    (1,437,195)At
    January 1, 2017
    
    -
    
    (1,382,255)
    
    (33,052)
    
    (21,888)
    
    (1,437,195)Amortisation
    
    -
    
    (1,341,860)
    
    (131,419)
    
    (10,488)
    
    (1,483,767)Disposal
    
    -
    
    -
    
    -
    
    -
    
    -Exchange
    difference
    
    -
    
    167,679
    
    37,075
    
    3,639
    
    208,393At
    December 31, 2017
    
    -
    
    (2,556,436)
    
    (127,396)
    
    (28,737)
    
    (2,712,569)Carrying
    AmountAt
    December 31, 2016
    
    14,256,751
    
    9,511,726
    
    1,022,122
    
    12,497
    
    24,803,096At
    December 31, 2017
    
    13,061,371
    
    7,897,068
    
    1,089,231
    
    4,640
    
    22,052,310  The
technology and software applied to develop the autostereoscopic 3D display technologies was included with the acquisition of Marvel
Digital Limited on September 30, 2015 and was revalued to fair value at that time by an independent valuer. For
the above goodwill and autostereoscopic 3D display technologies and knowhow at the reporting period end, the management has considered
the recoverable amount of the corresponding cash generating unit which has been determined by a value-in-use calculation. The
key assumptions for the value in use calculations are those regarding the discount rates, growth rates and expected changes in
gross margin of the products and services. Management estimates discount rates that reflect current market assessments of the
time value of money and the risks specific to the cash generating unit. The growth rates are based on industry growth forecasts.
Changes in gross margin are based on past practices and expectations of future changes in the market. The Group performed impairment
review for the goodwill, based on the cash flow forecast derived from the most recent financial budgets and estimated future cash
flows for the following five years and using a discount rate of 18% (2016: 18%). The present value of future cash flows has been
calculated using projected cashflows approved by the board covering year 1. The present value of future cash flows for years 2
to 5 have been calculated using average growth rates of approximately 40%. The cash flows beyond the five-year period are extrapolated
using a 3% (2016: 3%) growth rate. The recoverable amount of the corresponding cash generating unit from our value-in-use calculation is estimated to be approximately A$40,150,000, which exceeded the carrying amount of intangible assets and goodwill.  The management has considered and assessed reasonably possible changes for other key assumptions and has not identified any instances that could cause the carrying amount of the cash generating unit to exceed its recoverable amount. Based on the results of impairment review and value-in-use assessment, the management considered
that there is no indication that the goodwill and intangible assets have suffered an impairment loss.  F-24     NOTE
17. DEVELOPMENT PROJECTS  A$At
    January 1, 2016Cost
    
    
    
    690,889Accumulated
    impairment losses
    
    
    
    -Net
    book amount
    
    
    
    690,889Year
                                    ended December 31, 2016
        Opening
        net book amount
    
    
    
    690,889Additions
    
    
    
    2,528,308Reclassification
    
    
    
    (60,218)Disposal
    
    
    
    (351,951)Exchange
    difference
    
    
    
    72,977Closing
    net book amount
    
    
    
    2,880,005At
    December 31, 2016Cost
    
    
    
    2,880,005Accumulated
    impairment losses
    
    
    
    -Net
    book amount
    
    
    
    2,880,005Year
                                    ended December 31, 2017
        Opening
        net book amount
    
    
    
    2,880,005Additions
    
    
    
    1,961,191Reclassification
    
    
    
    (439,069)Disposal
    
    
    
    (68,360)Exchange
    difference
    
    
    
    (306,315)Closing
    net book amount
    
    
    
    4,027,452At
    December 31, 2017Cost
    
    
    
    4,027,452Accumulated
    impairment losses
    
    
    
    -Net
    book amount
    
    
    
    4,027,452 Development
projects represent the development costs directly attributable to and incurred for several internal technology projects of the
Group which are in cooperation with the universities and professional technology institutions in Hong Kong for developing innovative
technology to be applied in the existing and new 3D related products of the Group. Cost model is applied for development projects
which require these assets to be carried at cost less any accumulated impairment losses. The Group had performed impairment review
for the development projects at the reporting period end and there was no indication that the development projects have suffered
an impairment loss.   NOTE
18. TRADE AND OTHER LIABILITIES  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Trade
    payables
    
    
    
    63,440
    
    799,522Accruals
    
    
    
    334,425
    
    380,594Deferred revenue
    
    
    
    165,983
    
    161,401Value
    added tax payables
    
    
    
    157,489
    
    313,326Amounts due to related
    companies
    
    
    
    33,353
    
    -Others
    
    
    
    75,754
    
    -830,444
    
    1,654,843  The
amounts due to the related companies are unsecured, non-interest bearing and repayable on demand.  NOTE
19. PROVISIONS  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Employee
    benefits
    
    
    
    49,166
    
    31,331 NOTE
20. AMOUNT DUE TO ULTIMATE HOLDING COMPANY  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Current
    portion
    
    
    
    157,492
    
    2,382,707Non-current
    portion (Note 28(b))
    
    
    
    15,110,749
    
    -15,268,241
    
    2,382,707 The
amount due to the ultimate holding company – Marvel Finance Limited ("MFL") was primarily from the acquisition
of Marvel Digital Limited ("MDL") in September 2015. The ultimate holding company agrees to provide financial support
to the Group in the early stage for on-going technology development and operation after the acquisition of MDL. As
at December 31, 2016, the whole amount due to MFL is unsecured, and carries interest at an annual interest rate of 2.5% over the
one month Hong Kong Interbank Offer Rate ("HIBOR") and repayable on demand. As at December 31, 2017, the non-current
portion of amount due to MFL is unsecured and carries interest at an annual interest rate of 2.5% over the one month HIBOR starting
from February 1, 2018 and is not expected to be repaid in the next twelve months, while the current portion is unsecured, carries
interest at an annual interest rate of 2.5% over the one month HIBOR and repayable on demand.   NOTE
21. BORROWINGS  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Bank
    overdraft, unsecured
    
    
    
    789,942
    
    784,029Bank
    borrowings, unsecured
    
    
    
    819,450
    
    447,2501,609,392
    
    1,231,279  Bank
overdraft and borrowings carry interest at an annual interest rate of 2.5% over the one month HIBOR. As
at December 31, 2017, the Group had total banking facilities of A$1,638,900 (2016: A$1,789,000) of which A$1,609,392 (2016:A$1,231,279)
were utilised. The
unsecured bank overdraft and bank borrowings are guaranteed by our director, Dr. Herbert Ying Chiu LEE.   F-25     NOTE
22. OBLIGATION UNDER FINANCE LEASE  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Within
    one year
    
    
    
    15,653
    
    -Two
    to five years
    
    
    
    51,819
    
    -67,472
    
    -Less: Amount due within
    one year shown under current liabilities
    
    
    
    (15,653)
    
    -Amount due after one
    year
    
    
    
    51,819
    
    -No later than 1 year
    
    
    
    18,522
    
    -Later than 1 year and
    no later than 5 years
    
    
    
    55,567
    
    -74,089
    
    -Future finance charges
    on finance leases
    
    
    
    (6,617)
    
    -Present value of finance
    lease liability
    
    
    
    67,472
    
    - Obligation
under finance lease carry interest rates of 2.5% per annum.   NOTE
23. CONTROLLED ENTITIES As
at December 31, 2017, the entities controlled by the Company are as follows:  Name
    of Subsidiary
    
    Country
    of Incorporation
    
    Principal
    Activities
    
    Paid
    Up Capital
    
    PercentageOwned2017
    
    2016CIMC
    Marketing Pty. Limited
    
    Australia
    
    Management
                                         services and trading
    
    A$1
    
    100%
    
    100%Yamaga
    Limited
    
    Hong
    Kong
    
    Provision
    of advertising and media services
    
    HK$1
    
    100%
    
    100%Dragon
    Creative Limited
    
    Hong
    Kong
    
    Sale
                                         and distribution of various 3D related products and provision of 3D consulting services
    
    HK$8
    
    100%
    
    100%Binario
    Limited
    
    British
                                         Virgin Islands
    
    Investment
    holding
    
    A$1
    
    100%
    
    100%Yamga
    Audio Limited
    
    United
    States of America
    
    Investment
    holding
    
    US$1
    
    100%
    
    100%Zamora
    Corporation
    
    United
    States of America
    
    Sale
    and administration office in U.S.A.
    
    US$1
    
    100%
    
    100%Digital
    Media Technology Limited
    
    Malaysia
    
    Dormant
    
    US$100
    
    100%
    (indirect)
    
    100%
    (indirect)Marvel
    Digital Limited
    
    Hong
    Kong
    
    Development
                                         of 3D autostereoscopic display technology and investment holding
    
    HK$30,002,970
    
    100%
    (indirect)
    
    100%
    (indirect)Visumotion
    International Limited
    
    Hong
    Kong
    
    Sales
                                         of software and provision of consultancy services
    
    HK$1
    
    100%
    (indirect)
    
    100%
    (indirect)Marvel
    Digital (Shenzhen) Limited
    
    P.R.C
    
    Manufacturing
                                         and distribution of 3D products and provision of 3D consultancy services
    
    RMB23,939,197
    
    100%
    (indirect)
    
    100%
    (indirect)Marvel
    Software (Shenzhen) Limited
    
    P.R.C
    
    Dormant
    
    RMB422,380
    
    100%
    (indirect)
    
    100%
    (indirect)Global
    Vantage Audio Limited
    
    Hong
    Kong
    
    Sale
    and distribution of audio products
    
    HK$1
    
    50%
    (indirect)
    
    50%
    (indirect)GOXD
    Technology Limited
    
    Hong
    Kong
    
    Development
    and distribution of 3D digital picture frames
    
    HK$10,000
    
    100%
    (indirect)
    
    -    F-26     NOTE
24. BUSINESS COMBINATIONS (a)Acquisition
                                         of Conco International Co., Ltd. ("CICL") On
February 9, 2015, the Company acquired all of the issued shares of Conco International Co., Ltd. ("CICL"), which is
a company principally engaged in the design, sales and distribution of audio products. The consideration paid was A$61,591 which
was the amount of the net asset value of CICL. The consideration was settled by the Company issuing 307,954 shares at A$0.20 each.
The purchase agreement also provides that Performance Shares be issued to the vendor contingent on CICL achieving an agreed level
of profit performance. The value of the Performance Shares to be issued ("Bonus Shares") will be equivalent to five
times the average annual net profits of CICL for the three years ending December 31, 2018 less the consideration paid on acquisition.
The number of shares to be issued will be the value of the Bonus Shares divided by the Share Price which is defined in the
agreement as the twenty days closing average price of the Company's shares quoted on the Australian Securities Exchange. Assets
        acquired and liabilities assumed at the date of acquisition
    
    
    A$Current
    assetsTrade
    and other receivables
    
    
    177,702Cash
    and cash equivalents
    
    
    17,013Non-current
    assetsPlant
    and equipment
    
    
    199,854Current
    liabilitiesTrade
    and other payables
    
    
    (88,090)Deposits
    received
    
    
    (244,888)Total
    identifiable net assets acquired
    
    
    61,591Value
    of equity issued
    
    
    61,591 The
above assets acquired and liabilities assumed at the date of acquisition are at fair value. No goodwill was therefore arisen from
this acquisition. For
the year ended December 31, 2015, CICL contributed revenue of approximately A$1,560,000 and profit of A$42,000 to the Group's
results. (b)Acquisition
                                         of Marvel Digital Limited ("MDL") On
September 30, 2015, the Company acquired all of the issued shares of Marvel Digital Limited ("MDL"), which is a company
principally engaged in the development of autostereoscopic 3D display technology, 2D to 3D conversion software and digital content
management system. The consideration paid was A$5,216,213 which was the amount of the net asset value of MDL. The consideration
was settled by the Company issuing 26,081,065 shares at A$0.20 each. The purchase agreement also provides that a deferred performance
fee calculated at five times of the average annualized consolidated profits of MDL for the two years' period from the completion
date less the initial purchase consideration. The
Company engaged an independent valuer, RHL Appraisal Limited, to perform a valuation on the purchase price allocation of the identifiable
net assets acquired in MDL as at acquisition date. Their valuation was carried out on a fair value basis and in determining the
fair value of intangible assets, the valuer adopted an income approach known as the multi-period excess earning method in which
the earnings of the intangible assets are separated from the total earnings of MDL by identifying and deducting portions of the
total earnings that are attributable to the contributory assets, which are the assets used in the production of earnings associated
with the intangible asset being valued. The excess earnings that are attributable to the subject intangible asset are then discounted
to present value at the appropriate required rate of return. A weighted average cost of capital plus a risk premium for intangible
assets is determined at 20.19% for the subject intangible assets as at the valuation date.   F-27     NOTE
24. BUSINESS COMBINATIONS (Continued) (b)Acquisition
                                         of Marvel Digital Limited ("MDL") (Continued) Assets
    acquired and liabilities assumed at the date of acquisitionCarrying
    Value
    
    Fair
    ValueA$
    
    A$Current
    assetsTrade
    and other receivables
    
    1,369,911
    
    1,369,911Inventories
    
    1,188,167
    
    1,188,167Tax
    receivables
    
    86,721
    
    86,721Cash
    and cash equivalents
    
    854,057
    
    854,057Non-current
    assetsPlant
    and equipment
    
    1,574,817
    
    1,574,817Development
    projects
    
    709,463
    
    709,463Intangible
    assets
    
    3,245,276
    
    11,273,717Current
    liabilitiesTrade
    and other payables
    
    (3,754,912)
    
    (3,754,912)Deposits
    received
    
    (57,287)
    
    (57,287)Non-current
    liabilitiesDeferred
    tax liabilities
    
    -
    
    (1,324,693)Total
    identifiable net assets acquired
    
    5,216,213
    
    11,919,961 The
Directors considered the above trade and other receivables acquired at the date of acquisition are fully collectible and approximate
the fair value. For
the three months ended December 31, 2015, MDL contributed revenue of approximately A$4,750,000 and profit after income tax of
A$2,990,000 to the Group's results. Consideration
transferred and goodwill The
following table summarizes the acquisition date fair value of each major class of consideration transferred: A$Initial
    purchase consideration-        
    Equity instruments
    
    
    
    5,216,213Contingent
    consideration
    
    
    
    21,396,339Total
    consideration transferred
    
    
    
    26,612,552Less:
    Fair value of identifiable net assets acquired
    
    
    
    (11,919,961)Goodwill
    (Note 16)
    
    
    
    14,692,591 (c)Acquisition
                                         of acquired other subsidiaries During
the year ended December 31, 2016, the Company added the following subsidiaries to the consolidated group: Fair
    Value of Net Assets
    
    Consideration
    Paid$
    
    $Yamaga
    Audio Limited
    
    
    
    1
    
    1Zamora
    Corporation
    
    
    
    1
    
    1Total
    
    
    
    2
    
    2 As
at the date of acquisition there were no other assets or liabilities and therefore no goodwill arose out of the acquisitions. (d)Sale
                                         of Conco International Co., Ltd During
the year ended December 31, 2016. The Company disposed of its shareholding in Conco International Co., Ltd. ("CICL")
which was a company principally engaged in the design, sales and distribution of audio products. The consideration received for
the disposal of shares was A$54,257. A loss on disposal of A$872 was incurred on the disposal of these shares.   F-28     NOTE
25. ISSUED CAPITAL  (a) Share Capital
    
    December
    31, 2017
    
    December
    31, 2016
    
    December
    31, 2015Number
    of shares
    
    A$
    
    Number
    of shares
    
    A$
    
    Number
    of shares
    
    A$Ordinary
                                    Shares
        fully
        paid
    
    2,643,611
    
    10,410,279
    
    79,301,852
    
    10,410,279
    
    79,301,852
    
    10,410,279  (b)
Movements in ordinary share capital Number
    of Shares
    
    A$December
    31, 2014 and January 1, 2015
    
    52,912,833
    
    5,132,475Issue
    of shares during the year
    
    26,389,019
    
    5,277,804December
    31, 2015 and January 1, 2016
    
    79,301,852
    
    10,410,279Issue
    of shares during the year
    
    -
    
    -December
    31, 2016 and January 1, 2017
    
    79,301,852
    
    10,410,2791-for-30
    reverse split of our fully paid ordinary shares
    
    (76,658,241)
    
    -December
    31, 2017
    
    2,643,611
    
    10,410,279 There
is only one class of share on issue being ordinary fully paid shares. Holders of ordinary shares are treated equally in all respects
regarding voting rights and with respect to the participation in dividends and in the distribution of surplus assets upon a winding
up. The fully paid ordinary shares have no par value. On
May 2, 2017, the Company effectuated a 1-for-30 reverse split of the ordinary shares, which was approved at a special meeting
of the shareholders on March 2, 2017. The purpose of the reverse stock split was to enable the Company to meet the Nasdaq's
minimum share price requirement. The reverse stock split became effective on May 8, 2017 and every thirty issued and outstanding
ordinary shares were automatically combined into one issued and outstanding ordinary share. This reduced the number of outstanding
shares from 79,301,852 shares to 2,643,611 after adjusting for fractional shares. (c)
Options on issue There
were no share options issued and outstanding during and at the end of the financial year. NOTE
26. RESERVE Foreign
currency translation reserve The
translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign
operations to Australian dollars. NOTE
27. COMMITMENTS (a)Non-cancellable
                                         operating leases The
Group has entered into commercial leases for rental accommodation and certain items of plant and equipment. The lease terms ranged
from one year to five years.  ConsolidatedDecember
    31, 2017
    
    December
    31, 2016A$
    
    A$Committed
                                         at the reporting date but not recognized as liabilities,
        which
        are payable:-
    Within     one year
    
    273,784
    
    263,043-
    Two     to five years
    
    285,769
    
    149,813-
    More     than five years
    
    -
    
    -559,553
    
    412,856   F-29     NOTE
27. COMMITMENTS (Continued) (b)Contractual
                                         commitments  As
at December 31, 2017, the Group had contractual commitments for certain development projects of approximately A$1,925,797 which
are payable in 2018 (2016: A$1,215,000). (c)Capital
                                         commitments As
at December 31, 2017, the Group had internal capital commitments for the investments in two PRC subsidiaries of RMB25,638,000
(approximately A$5,045,000) (2016: A$5,312,000).  NOTE
28. CONTINGENT CONSIDERATION LIABILITY (a)There
                                         are no material contingent liabilities or contingent assets of the Group at the end of
                                         the reporting period. The contingent consideration liability as at December 31, 2016
                                         represented the contingent consideration payable for acquisition of Marvel Digital Limited
                                         ("MDL") as disclosed below: In
accordance with the terms of MDL acquisition, the Company agreed to pay Marvel Finance Limited ("MFL") a deferred
performance fee calculated at five times of the average annualized consolidated profits of MDL for the two year period from the
completion date less the initial purchase consideration. The Group included approximately HK$115,980,000, equivalent to A$20,748,035
as contingent consideration liability, as at December 31, 2016. There was no more contingent consideration as at December 31,
2017 as the Company recognized the actual deferred performance fee to be paid to MFL of A$15,110,749. Pursuant
to the agreement, the Company agreed to pay this deferred performance fee by cashier order or banker draft within two weeks upon
the Company and MFL agreeing on the audited profits no later than four months after the second anniversary of the date of acquisition,
i.e. January 31, 2018. Subsequently in February 2018, MFL has agreed with the Company not to seek payment of the deferred performance
fee until the earlier of the time the Company is in the position to repay the amount but no earlier than April 30, 2019. The amount
due to MFL arising from this deferred performance fee was included in amount due to ultimate holding company in non-current liabilities
at the reporting date. The unpaid amount of the deferred performance fee will carry interest at an interest rate of 2.5% per annum
over one month Hong Kong Interbank Offer Rate starting from February 1, 2018. MFL also confirmed that the payment of the deferred
performance fee can be in shares or cash or a combination of both, which will be decided and agreed upon further discussion with
the Company. (b)Reconciliation
                                         of contingent consideration liability ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$Balance
    brought forward
    
    20,748,035
    
    20,836,176Fair
    value change in contingent consideration liability
    
    (3,953,537)
    
    -Exchange
    difference
    
    (1,683,749)
    
    (88,141)Deferred
    performance fee reclassified to amount due to ultimate holding company
    
    (15,110,749)
    
    -Total
    
    -
    
    20,748,035 NOTE
29. FINANCIAL RISK MANAGEMENT (a)
	Financial risk management objectives The
Group is exposed to financial risk through the normal course of their business operations. The key risks impacting the Group's
financial instruments are considered to be interest rate risk, foreign currency risk, liquidity risk, credit risk and capital
risk. The Group's financial instruments exposed to these risks are cash and short term deposits, receivables, trade payables
and borrowings. The
Group's chief executive officer is Dr. Herbert Ying Chiu LEE, who monitors the Group's risks on an ongoing basis and
report to the Board. (b)
	Interest rate risk management The
Group is exposed to interest rate risk (primarily on its cash and bank balances, amount due to ultimate holding company, borrowings
and obligation under finance lease), which is the risk that a financial instrument's value will fluctuate as a result of
changes in the market interest rates on interest-bearing financial instruments. The
Group has adopted a policy of ensuring it maintains adequate cash and cash equivalents balances available at call. These accounts
currently earn low interests.   F-30     NOTE
29. FINANCIAL RISK MANAGEMENT (Continued) (b)Interest
                                         rate risk management (Continued) The
sensitivity analyses below have been determined based on the exposure to interest rates at the reporting date and the stipulated
change taking place at the beginning of the financial year and held constant throughout the reporting period. A 50 basis point
increase or decrease represents management's assessment of the possible change in interest rates. At
reporting date, if interest rates had increased/decreased by 50 basis points from the weighted average effective rate for the
year, with other variables constant, the profit for the year would have been A$898 lower (2016: A$12,708 lower) / A$898 higher
(2016: A$12,708 higher). The
following table summarizes interest rate risk for the Group, together with effective interest rates as at the reporting date. Weighted
    average effective interest rate
    
    Floating
        interest
        rateA$
    
    Non-interest
    bearingA$
    
    TotalA$2017Financial
    AssetsCash
    and bank balances
    
    0.23%
    
    1,654,659
    
    1,205,355
    
    2,860,014Trade
    and other receivables
    
    
    
    -
    
    3,379,829
    
    3,379,829Other
    assets
    
    
    
    -
    
    199,392
    
    199,392Total
    Financial Assets
    
    
    
    1,654,659
    
    4,784,576
    
    6,439,235Financial
    LiabilitiesTrade
    and other payables
    
    
    
    -
    
    664,461
    
    664,461Trade
    deposits received
    
    
    
    -
    
    7,939
    
    7,939Amount
due to ultimate holding company
    
    3.07%
    
    15,268,241
    
    -
    
    15,268,241Bank
    overdraft
    
    3.07%
    
    784,942
    
    -
    
    789,942Bank
    borrowings
    
    3.07%
    
    819,450
    
    -
    
    819,450Obligation
    under finance lease
    
    4.87%
    
    67,472
    
    -
    
    67,472Provisions
    
    
    
    -
    
    49,166
    
    49,166Total
    Financial Liabilities
    
    
    
    16,945,105
    
    721,566
    
    17,666,671  Weighted
    average effective interest rate
    
    Floating
        interest
        rateA$
    
    Non-interest
    bearingA$
    
    TotalA$2016Financial
    AssetsCash
    and cash balances
    
    0.30%
    
    1,072,355
    
    748,639
    
    1,820,994Trade
    and other receivables
    
    
    
    -
    
    8,800,741
    
    8,800,741Other
    assets
    
    
    
    -
    
    2,253,915
    
    2,253,915Total
    Financial Assets
    
    
    
    1,072,355
    
    11,803,295
    
    12,875,650Financial
    LiabilitiesTrade
    and other payables
    
    
    
    -
    
    1,654,843
    
    1,654,843Trade
    deposits received
    
    
    
    -
    
    99,866
    
    99,866Amount
due to ultimate holding company
    
    2.82%
    
    2,382,707
    
    -
    
    2,382,707Bank
    overdraft
    
    0.27%
    
    784,029
    
    -
    
    784,029Borrowings
    
    0.27%
    
    447,250
    
    -
    
    447,250Provisions
    
    
    
    -
    
    31,331
    
    31,331Contingent
    consideration liability
    
    
    
    -
    
    20,748,035
    
    20,748,035Total
    Financial Liabilities
    
    
    
    3,613,986
    
    22,534,075
    
    26,148,061  F-31     NOTE
29. FINANCIAL RISK MANAGEMENT (Continued) (c)
	Foreign currency risk The
Group has net assets denominated in certain foreign currencies as at December 31, 2017. Foreign currency denominated financial
assets and liabilities which expose the Group to currency risk are disclosed below. The amounts are those reported to key management
translated into AUD at the closing rate: Short
    term exposure
    
    Long
    term exposureHKD
    
    USD
    
    RMB
    
    HKD
    
    USD
    
    RMBDecember
    31, 2017Financial
    assets-
    Cash and bank balances
    
    1,219,072
    
    41,218
    
    1,590,859
    
    -
    
    -
    
    --
    Trade and other receivables
    
    965,855
    
    3
    
    2,413,971
    
    -
    
    -
    
    --
    Other assets
    
    86,750
    
    -
    
    108,760
    
    -
    
    -
    
    -Financial
    liabilities-
    Trade and other liabilities
    
    (281,281)
    
    (53,495)
    
    (254,860)
    
    -
    
    -
    
    --
    Trade deposit received
    
    (7,939)
    
    -
    
    -
    
    -
    
    -
    
    --
    Amount due to ultimate holding company
    
    (147,140)
    
    -
    
    (9,839)
    
    (15,110,749)
    
    -
    
    --
    Provisions
    
    (49,166)
    
    -
    
    -
    
    -
    
    -
    
    --
    Bank overdraft
    
    (789,942)
    
    -
    
    -
    
    -
    
    -
    
    --
    Borrowings
    
    (819,450)
    
    -
    
    -
    
    -
    
    -
    
    --
    Obligation under finance lease
    
    (67,472)
    
    -
    
    -
    
    -
    
    -
    
    -Total
    exposure
    
    109,287
    
    (12,274)
    
    3,848,891
    
    (15,110,749)
    
    -
    
    - Cash
and cash equivalents are exposed to foreign currency risk in a higher extent. Short
    term exposure
    
    Long
    term exposureHKD
    
    USD
    
    RMB
    
    HKD
    
    USD
    
    RMBDecember
    31, 2016Financial
    assets-
    Cash and bank balances
    
    700,001
    
    51,227
    
    1,061,086
    
    -
    
    -
    
    --
    Trade and other receivables
    
    685,150
    
    2
    
    8,115,624
    
    -
    
    -
    
    --
    Other assets
    
    70,937
    
    222
    
    56,380
    
    -
    
    -
    
    -Financial
    liabilities-
    Trade and other liabilities
    
    (260,166
    )
    (1,892)
    
    (1,304,533)
    
    -
    
    -
    
    --
    Amount due to ultimate holding company
    
    (2,382,194
    )
    -
    
    -
    
    -
    
    -
    
    --
    Provisions
    
    (31,331
    )
    -
    
    -
    
    -
    
    -
    
    --
    Borrowings
    
    (1,231,279
    )
    -
    
    -
    
    -
    
    -
    
    --
    Contingent payable liability
    
    -
    
    -
    
    -
    
    (20,748,035)
    
    -
    
    -Total
    exposure
    
    (2,448,882
    )
    49,559
    
    7,928,557
    
    (20,748,035)
    
    -
    
    - The
following table illustrates the sensitivity of profit / (loss) and equity in regards to the Group's financial assets and
financial liabilities and the HKD/AUD exchange rate, USD/AUD exchange rate and RMB/AUD exchange rate and ‘all other things
being equal'. It assumes a +/- 5% change of the AUD/HKD exchange rate for the year ended at December 31, 2017 (2016: 5%).
A +/- 5% change is considered for the AUD/USD exchange rate (2016: 5%). A +/- 10% change is considered for the AUD/RMB exchange
rate (2016: 10%). These percentages have been determined based on the average market volatility in exchange rates in the previous
twelve 12 months. The sensitivity analysis is based on the Group's foreign currency financial instruments held at each reporting
date and also takes into account forward exchange contracts that offset effects from changes in currency exchange rates. If
the AUD had strengthened against the HKD by 5% (2016: 5%), the USD by 5% (2016: 5%) and the RMB by 10% (2016: 10%) respectively
then this would have had the following impact: Profit
    / (Loss) for the year
    
    EquityHKD
    
    USD
    
    RMB
    
    Total
    
    HKD
    
    USD
    
    RMB
    
    TotalDecember
    31, 2017
    
    750,073
    
    614
    
    (384,889)
    
    365,798
    
    750,073
    
    614
    
    (384,889)
    
    365,798December
    31, 2016
    
    1,159,846
    
    (2,478)
    
    (792,856)
    
    364,512
    
    1,159,846
    
    (2,478)
    
    (792,856)
    
    364,512   F-32     NOTE
29. FINANCIAL RISK MANAGEMENT (Continued) (c)
	Foreign currency risk (Continued) If
the AUD had weakened against the HKD by 5% (2016: 5%), the USD by 5% (2016: 5%) and the RMB by 10% (2016: 10%) respectively then
this would have had the following impact:  Profit
    / (Loss) for the year
    
    EquityHKD
    
    USD
    
    RMB
    
    Total
    
    HKD
    
    USD
    
    RMB
    
    TotalDecember
    31, 2017
    
    (750,073)
    
    (614)
    
    384,889
    
    (365,798)
    
    (750,073)
    
    (614)
    
    384,889
    
    (365,798)December
    31, 2016
    
    (1,159,846)
    
    2,478
    
    792,856
    
    (364,512)
    
    (1,159,846)
    
    2,478
    
    792,856
    
    (364,512)  Exposures
to foreign exchange rates vary during the year depending on the volume of overseas transactions. Nonetheless, the analysis above
is considered to be representative of the Group's exposure to currency risk. (d)
	Liquidity risk management Prudent
liquidity risk management implies maintaining sufficient cash and term deposits, the availability of funding through an adequate
amount of committed credit facilities and the ability to close out market positions. The Group manages liquidity risk by continuously
monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. The
following tables detail the Group's remaining contractual maturity for its non-derivative financial liabilities based on
the agreed repayment terms or the earliest date on which the Group can be required to pay. The table has been drawn up based on
the undiscounted cash flows of financial liabilities and include both interest and principal cash flows.  2017
    
    
    Totalcontractual
    
    0
    - 30 daysCarrying
    
    undiscounted
    
    or
    on
    
    31
    - 90
    
    91
    -365
    
    Overamount
    
    cash
    flow
    
    demand
    
    days
    
    Days
    
    1
    year$
    
    $
    
    $
    
    $
    
    $
    
    $Trade
    and other liabilities
    664,461
    
    664,461
    
    664,461
    
    -
    
    -
    
    -Trade
    deposits received
    7,939
    
    7,939
    
    7,939
    
    -
    
    -
    
    -Amount
    due to ultimate holding company
    15,268,241
    
    15,779,510
    
    157,492
    
    -
    
    -
    
    15,622,018Bank
    overdraft
    789,942
    
    789,942
    
    789,942
    
    -
    
    -
    
    -Bank
    borrowings
    819,450
    
    833,554
    
    -
    
    -
    
    833,554
    
    -Obligation
    under finance lease
    67,472
    
    74,089
    
    1,543
    
    3,087
    
    13,892
    
    55,567Provisions
    49,166
    
    49,166
    
    49,166
    
    -
    
    -
    
    -17,666,671
    
    18,198,661
    
    1,670,543
    
    3,087
    
    847,446
    
    15,677,585  2016
    
    
    Totalcontractual
    
    0
    - 30 daysCarrying
    
    undiscounted
    
    or
    on
    
    31
    - 90
    
    91
    -365
    
    Overamount
    
    cash
    flow
    
    demand
    
    days
    
    Days
    
    1
    year$
    
    $
    
    $
    
    $
    
    $
    
    $Trade
    and other liabilities
    1,654,843
    
    1,654,843
    
    1,654,843
    
    -
    
    -
    
    -Trade
    deposits received
    99,866
    
    99,866
    
    99,866
    
    -
    
    -
    
    -Amount
    due to ultimate holding company
    2,382,707
    
    2,382,707
    
    2,382,707
    
    -
    
    -
    
    -Bank
    overdraft
    784,029
    
    784,029
    
    784,029
    
    -
    
    -
    
    -Bank
    borrowings
    447,250
    
    449,516
    
    -
    
    449,516
    
    -
    
    -Provisions
    31,331
    
    31,331
    
    31,331
    
    -
    
    -
    
    -Contingent
    consideration liability
    20,748,035
    
    20,748,035
    
    -
    
    -
    
    -
    
    20,748,03526,148,061
    
    26,150,327
    
    4,952,776
    
    449,516
    
    -
    
    20,748,035   F-33     NOTE
29. FINANCIAL RISK MANAGEMENT (Continued) (e)
	Credit risk Credit
risk refers to the risk that a counter-party will default on its contractual obligations resulting in a financial loss to the
Group. The Group's potential concentration of credit risk consists mainly of cash deposits with banks and trade receivables
with its customers. The Group's short term cash surpluses are placed with banks that have investment grade ratings. The
Group considers the credit standing of counterparties and customers when making deposits and sales, respectively, to manage the
credit risk. The Group does not have any material credit risk exposure to any single debtor or group of debtors under financial
instruments entered into by the Group. Considering the nature of the business at current, the Group believes that the credit risk
is not material to the Group's operations. The
maximum exposure to credit risk, excluding the value of any collateral or other security, at the end of the reporting period,
to financial assets, is represented by the carrying amount of cash and bank balances, trade and other receivables, net of any
provisions for doubtful debts, as disclosed in the consolidated statement of financial positions and notes to the consolidated
financial statements. (f)
	Fair value of financial instruments The
following liability is recognized and measured at fair value on a recurring basis: -
Contingent consideration liability. Fair
value hierarchy All
assets and liabilities for which fair value is measured or disclosed are categorized according to the fair value hierarchy as
follows: Level
1: Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level
2:	Inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. Level
3:	Inputs for the asset or liability that are not based on observable market data (unobservable inputs). Recognized
fair value measurements The
following table sets out the Group's assets and liabilities that are measured at fair value in the consolidated financial
statements.  Level
    1
    
    Level
    2
    
    Level
    3
    
    Total$
    
    $
    
    $
    
    $Contingent
    consideration liability-
    December 31, 2017
    
    -
    
    -
    
    -
    
    --
    December 31, 2016
    
    -
    
    -
    
    20,748,035
    
    20,748,035 There
were no transfers during the year between level 1 and level 2 recurring fair value measurements. The
Group's policy is to recognize transfers into and of the different fair value hierarchy levels at the date the event or
change in circumstances that caused the transfer occurred. Disclosed
fair values The
Group also has assets and liabilities which are not measured at fair values but for which fair values are disclosed in the notes
to the consolidated financial statements. Due
to their short term nature, the carrying amounts of trade receivables (refer to Note 13) and payables (refer to Note 18) are assumed
to approximate their fair values because the impact of discounting is not significant. (g)
	Capital management risk The
Group's objective when managing capital are to safeguard the Group's ability to continue as a going concern and to
maintain a strong capital base sufficient to maintain future development of its business. In order to maintain or adjust the capital
structure, the Group may return capital to shareholders, issue new shares or sell assets to reduce debts. The Group's focus
has been to raise sufficient funds through equity to fund its business activities. There
were no changes to the Group's approach to capital management during the year. Risk management policies and procedures are
established with regular monitoring and reporting. Neither
the Company nor any of its subsidiaries are subject to externally imposed capital requirements. The
capital structure of the Group consists of equity attributable to equity holders of the parent, comprising issued capital, foreign
currency translation reserve and retained earnings as disclosed in Notes 25 and 26 respectively.   F-34     NOTE
30. RELATED PARTIES (a)Parent
                                         and ultimate controlling party On
September 30, 2015, the Company issued 26,081,065 new ordinary shares at a price of A$0.20 per share to acquire 100% equity interests
in Marvel Digital Limited from Marvel Finance Limited, which is a company controlled and wholly owned by Dr. Herbert Ying Chiu
LEE. Marvel Finance Limited now owns 1,492,912 ordinary shares of the Company on a post-reverse split basis and is the ultimate
controlling party of the Group. (b)Transactions
                                         with directors During
the years ended December 31, 2017, 2016 and 2015, the remuneration of Directors of the Company is as follows: CompanyDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Short
    term benefits
    
    66,000
    
    49,000
    
    30,408Post-employment
    benefits
    
    -
    
    -
    
    2,048Total
    
    66,000
    
    49,000
    
    32,456 (c)Other
                                         related party transactions During
the years ended December 31, 2017, 2016 and 2015, the Group has following material transactions with its related parties: ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Revenue
    received from related parties (1)
    
    2,070,866
    
    1,297,556
    
    2,477,235Service
    fees paid to a related party (1)
    
    16,895
    
    12,919
    
    13,430Purchase
    of products from related parties (1)
    
    85,242
    
    57,759
    
    -Interest
    charged by the ultimate holding company
    
    61,066
    
    72,421
    
    -Company
    secretarial and service fees paid to related parties (2)
    
    5,250
    
    27,500
    
    -Sundry
    income receivable from a related party (1)
    
    -
    
    -
    
    238,858Expenses
    paid to a related party (1)
    
    -
    
    -
    
    23,952  (1)Dr. Herbert Ying Chiu LEE, has control over the above related parties. The transactions are carried at the current market
value in the ordinary course of business. (2)Our director, Mr. Con UNERKOV, is a common director of this related company. During
the year, the Group incurred expenditure of A$31,538 (excluding GST) to BDO Administration (SA) Pty Ltd in respect to company
secretarial and taxation services. George Yatzis, Company Secretary of IMT is a director of BDO Administration (SA) Pty Ltd. During
the year ended December 31, 2017, the unsecured bank overdraft and bank borrowings are personally guaranteed by our director,
Dr. Herbert Ying Chiu LEE. No charge has been requested for this guarantee. In
December 2015, the Group sold certain fixed assets at its net book amount of A$51,648 to a related entity which our Director,
Dr. Herbert Ying Chiu LEE, is holding approximately 69% equity interests. (d)Amounts
                                         due from / to related companies Included
in trade and other receivables in Note 13, there are amounts of A$1,002,058 and A$756,585 (2016: A$1,000,139 and A$182,378) which
are trade and non-trade in nature respectively and were due from certain related companies in which Dr. Herbert Ying Chiu LEE
has control. The amounts due from the related companies are unsecured, non-interest bearing and repayable on demand. Included
in trade and other liabilities in Note 18, there are amounts of A$8,186 and A$33,353 (2016: A$Nil) which are trade and non-trade
in nature respectively and were due to certain related companies in which Dr. Herbert Ying Chiu LEE has control. The amounts due
to the related companies are unsecured, non-interest bearing and repayable on demand. As
disclosed in Note 20, there was an amount of A$15,268,241 (2016: A$2,382,707) due to ultimate holding company, Marvel Finance
Limited as at December 31, 2017. As
at December 31, 2017, the Group had outstanding invoices owing to BDO Administration (SA) Pty Ltd totaling A$2,500 (2016: A$5,000).
George Yatzis, Company Secretary of IMT is a director of BDO Administration (SA) Pty Ltd.  F-35     NOTE
31. CASH FLOW INFORMATION ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$CASH
    FLOWS FROM CHANGES IN WORKING CAPITAL(Increase)
    / Decrease in assets:Trade
    and other receivables
    
    5,132,064
    
    (7,590,963)
    
    817,801Inventories
    
    37,360
    
    (1,209,655)
    
    476,565Other
    assets
    
    885,469
    
    (1,420,951)
    
    (634,661)Disposal
    of intangible assets
    
    -
    
    265,095
    
    -Development
    projects
    
    68,360
    
    -
    
    -Increase
    / (Decrease) in liabilities:Trade
    and other liabilities
    
    (770,205)
    
    1,205,218
    
    246,065Trade
    deposits received
    
    (82,390)
    
    (221,191)
    
    68,993Provisions
    
    20,603
    
    2,157
    
    26,527NET
    CASH INFLOWS / (OUTFLOWS) FROM CHANGES IN WORKING CAPITAL
    
    5,291,261
    
    (8,970,290
    )
    1,001,290 Reconciliation
of liabilities arising from financing activities  December
    31, 2016
    
    Cash
    flow
    
    Non-cash
    changes
    
    December
    31, 2017Deferred
    performance fee
    
    Foreign
    exchange movementA$
    
    A$
    
    A$
    
    A$
    
    A$Repayment
    of advances to related parties
    
    2,382,707
    
    (2,003,277)
    
    15,110,749
    
    (221,938)
    
    15,268,241Proceeds
    from bank borrowings
    
    447,250
    
    423,725
    
    -
    
    (51,525)
    
    819,450Total
    liabilities from financing activities
    
    2,829,957
    
    (1,579,552)
    
    15,110,749
    
    (273,463)
    
    16,087,691 NOTE
32. KEY MANAGEMENT PERSONNEL DISCLOSURES  (a)
	Remuneration The
total remuneration paid or payable to the directors and senior management of the Group during the year are as follows:  ConsolidatedDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Short-term
    employee benefits
    
    464,339
    
    573,477
    
    30,408Post-employment
    benefits
    
    9,265
    
    10,569
    
    2,048Total
    
    473,604
    
    584,046
    
    32,456  (b)
	Loans to Key Management Personnel and their related parties Save
as disclosed in Note 30(d), there were no other loans outstanding at the reporting date to Key Management Personnel and their
related parties Other
transactions with Key Management Personnel A
number of key management persons, or their related parties, held positions in other entities that resulted in them having control
or significant influences over the financials or operating policies of these entities. Transactions between related parties are
in normal commercial terms and conditions unless otherwise stated in Notes 13, 18, 20 and 30.  (c)
	Share Options – number of share options held by management There
were no share options held outstanding held by the management.  F-36     NOTE
33. PARENT ENTITY INFORMATION Set
out below is the supplementary information about the parent entity.  Statement
    of Comprehensive IncomeCompanyDecember
    31, 2017A$
    
    December
    31, 2016A$
    
    December
    31, 2015A$Loss
    after income tax
    
    486,715
    
    303,505
    
    203,168Other
    comprehensive income
    
    -
    
    -
    
    -Total
    comprehensive loss
    
    486,715
    
    303,505
    
    203,168  Statement
of Financial Position  CompanyDecember
    31, 2017
    
    December
    31, 2016A$
    
    A$Total
    non-current assets
    
    5,217,752
    
    5,216,219Total
    current assets
    
    3,319,257
    
    3,857,307Total
    assets
    
    8,537,009
    
    9,073,526Total
    current liabilities
    
    30,450
    
    80,252Total
    liabilities
    
    30,450
    
    80,252Total
    assets less liabilities
    
    8,506,559
    
    8,993,274  EquityIssued
    capital
    
    10,410,279
    
    10,410,279Accumulated
    losses
    
    (1,903,720)
    
    (1,417,005)Total
    equity
    
    8,506,559
    
    8,993,274 Guarantees
entered into by the parent entity in relation to the debts of its subsidiary The
parent entity is not party to a deed of cross guarantee with any of its subsidiaries.  Contingent
liabilities The
parent entity had no contingent liabilities as at December 31, 2017 and December 31, 2016.  Capital
commitments – property, plant and equipment The
parent entity has no capital commitments for property, plant and equipment as at December 31, 2017 and December 31, 2016.  Significant
accounting policies The
accounting policies of the parent entity are consistent with those of the Group, as disclosed in Note 3, except for: -Investments
                                         in subsidiaries are accounted for at cost, less any impairment, in the parent entity -Dividends
                                         received from subsidiaries are recognized as other income by the parent entity and its
                                         receipt may be an indicator of impairment.   F-37     NOTE
34. EVENTS OCCURRING AFTER THE REPORTING DATE  Save
as disclosed below, there is no other matter or circumstance arisen since December 31, 2017, which has significantly affected,
or may significantly affect the operations of the Group, the result of those operations, or the state of affairs of the Group
in subsequent financial years.  (i)Proposed
                                         share swap transaction by controlling shareholder  As
per our ASX announcement on November 23, 2017, November 27, 2017 and December 22, 2017, our major shareholder - Marvel Finance
Limited ("MFL") that it has entered into a conditional share swap agreement with Vantage Ultimate Limited ("Vantage"),
a wholly owned subsidiary of Sharing Economy International Inc. (formerly Clean Tech Solutions International, Inc.) (Nasdaq: SEII)
("SEII"), being 1,348,241 fully paid ordinary shares at a price of US$10.00 per IMT share (valuing the parcel of shares
at US$13,482,410). In consideration for the transfer, Vantage shall arrange for SEII to issue and allocate a certain number of
its ordinary voting shares, representing 19.5% of the issued share capital of SEII, and a 5-year interest-free promissory note
with a principal amount of US$11,482,410 to MFL. The agreement is subject to various conditions, including entry into a definitive
agreement satisfactory to the parties and legal and financial due diligence on or before February 28, 2018. On March 1, 2018,
MFL has indicated as the timeline has ended on February 28, 2018, the conditional share swap agreement has lapsed pursuant to
its terms therein.  (ii)Issue
                                         of HK$ 23 million convertible bonds in Marvel Digital Limited  As
per our ASX announcement on January 12, 2018, the Group entered into the following agreements in connection with the issue of
a HK$23 million (equivalent to approximately A$3.8 million) Convertible Bonds ("Convertible Bonds"): (i) Subscription
Agreement between Marvel Digital Limited, a wholly-owned subsidiary of the Company (the "Issuer" or "MDL")
and an independent third party entity ("Bondholder") for the Convertible Bonds, (ii) Deed of Guarantee between the
Company and the Bondholder to guarantee the payment obligations under the Convertible Bonds and (iii) Put Option Deed between
the Company and the Bondholder to repurchase any converted MDL Shares as described below. On the same date, pursuant to the Subscription
Agreement, the Convertible Bonds were issued by MDL to the Bondholder as all the terms and conditions in respect of the subscription
of the Convertible Bonds were complied with and fulfilled.  Pursuant
to the terms of the Convertible Bonds, the Convertible Bonds are convertible in the circumstances set out therein into 75,000
ordinary shares of MDL ("MDL Shares") at a conversion price of HK$306.67 per share, which is equivalent to 20% of
the enlarged issued share capital of MDL as of the date of this Announcement. The Bondholder will have the right to convert the
whole of their Convertible Bonds into ordinary shares of MDL at any time during the period from January 3, 2018 to January 2,
2020. The period may be extended to a further 12 months subject to the mutual agreement among MDL, Company and Bondholder. Unless
previously redeemed or converted, the Convertible Bonds will be redeemed at 100% of their principal amount on the Maturity Date.  In
connection with the Convertible Bonds, the Company also entered into a Deed of Guarantee to guarantee the due and punctual performance
and observance by the Issuer of its payment obligations of the bond principal and interest under the Convertible Bonds until all
the guaranteed obligations have been fully satisfied, discharged or paid in full. A Put Option Deed was also entered into between
the Company and the Bondholder whereby the Bondholder can exercise an option, during the Put Option Exercise Period as defined
below, to have IMT repurchase the MDL Shares converted by the Bondholder at the principal amount of the converted Convertible
Bonds.  The
estimated net proceeds from this bond issue, after deduction of commission and expenses, amount to approximately HK$ 21.5 million
which will be used for general working capital purposes.  Further
details in relation to the terms of the Convertible Bonds can be referred to our ASX Announcement.  (iii)Sales
                                         Distribution Agreements for Autostereoscopic 3D Digital Video Walls  As
per our ASX announcement on March 19, 2018, the Company's wholly owned subsidiary, MDL, has entered into two sale distribution
agreements with two independent customers. The agreements relate to the sales of autostereoscopic 3D digital video walls and standalone
digital signages; and the total contract value is equivalent to approximately A$14,800,000 (RMB76,000,000).  The
customers and parties to the respective agreements are China based companies operating primarily in the Greater China region.
One of the customers will place the autostereoscopic 3D digital video walls at major cinema chains and commercial complex for
advertising and promotion purposes. The autostereoscopic 3D digital video wall is our latest flagship product. The video walls
are expected to be delivered progressively throughout the year and be completed in early 2019. The other customer will deploy
the digital signages for displaying advertisement and disseminating public information & organization news in educational
institutes, office buildings and government owned premises.  NOTE
35. COMPANY DETAILS The
registered office and principal place of business is: Level
7, 420 King William Street Adelaide
SA 5000     F-38      ITEM 19.
    
    EXHIBITS  The following exhibits are filed as part of this registration
statement:  Exhibit
    Description1.1^
    Constitution of Registrant4.1^
    Share Sale and Purchase Agreement for the purchase of 100% in Marvel Digital Limited between Marvel Finance Limited and IMT dated May 14, 20154.2^
    Share Sale and Purchase Agreement for the purchase of 100% in Conco International Co. Limited between Jeffrey Chang Ming-Yih and IMT dated December 22, 20144.3^
    Shareholder Agreement between Conco International Co., Limited and Kaijuyuan Technology Co., Limited to establish a joint venture company (now known as Global Vantage Audio Limited) dated May 8, 20154.4^
    Consulting Agreement between IMT and BDO Partnership SA Pty Limited for the provision of Company Secretarial services dated November 6, 20154.5^
    Directors agreement between IMT and Dr. Man Chung Chan dated January 1, 20164.6^
    Directors agreement between IMT and Dr. Chang Yuen Chan dated March 22, 20164.7^
    Directors agreement between IMT and Wilton Timothy Carr Ingram dated April 28, 20164.8^
    Directors agreement between IMT and Con Unerkov dated April 28, 20164.9^
    Employment agreement between IMT and Dr. Herbert Ying Chiu Lee dated January 1, 20168.1*
    List of subsidiaries12.1*
    Certification of Chief Executive Officer12.2*
    Certification of Principal Accounting Officer   ^
    Incorporated by reference on Form 20-F A/3 submitted on May 8, 2017.*
    Incorporated herein.    83      SIGNATURES  The
registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized
the undersigned to sign this registration statement on its behalf.   Integrated
    Media Technology Limited/s/    Dr. Herbert
    Ying Chiu LeeBy:
                                       Dr. Herbert Ying Chiu Lee
        Title:
        Executive Chairman and Chief Executive Officer    Date:
March 31, 2018     84