Singular Health Group Ltd (SHG, ASX)
Annual report, fiscal year 2021



Singular Health Group Ltd

ACN 58 639 242 765

Annual Report - 30 June 2021



Singular Health Group Ltd
Corporate directory
30 June 2021

Directors
Thomas Hanly
Prof. Kwang Guan Tay PhD
Denning Chong
Andrew Just (appointed 27 January 2021)
Howard Digby (appointed 27 January 2021)

Company secretary Steven Wood

Registered office c/o – Grange Consulting Pty Ltd
945 Wellington Street
West Perth WA 6005

Principal place of business 3/26 Railway Road
Subiaco, Western Australia 6008
Phone: 1300 167 795

Share register
Automic
Level 2, 267 St Georges Terrace
Perth WA 6000
Phone: 1300 288 664

Auditor
Moore Australia Audit (WA)
Level 15
Exchange Tower
2 The Esplanade
Perth WA 6000

Solicitors
Squire Paton Boggs (AU)
Level 21
300 Murray Street
Perth WA 6000

Bankers
Australian and New Zealand Banking Group Limited (ANZ)
Level 5
240 St Georges Terrace
Perth WA 6000

Stock exchange listing
Singular Health Group Ltd shares are listed on the Australian Securities Exchange (ASX code: SHG)

Website https://singular.health/

Corporate Governance Statement https://singular.health/wp-content/uploads/2021/09/SHG-Corporate-Governance-Statement_30-June-2021-4th-Edition.pdf



Dear Shareholders,

On behalf of the Board of Singular Health Group Limited, it is our pleasure to present the 2021 Annual Report.

Singular Health Group Limited (ASX:SHG) (“Singular Health” or the “Company”) is a medical technology company with a vision of empowering patients and practitioners through technology that enables personalised healthcare.

Singular Health’s core technology, the Volumetric Rendering Platform (“VRP”), enables the rapid conversion of 2-dimensional medical imaging data into fully interactive 3D models of patient’s anatomy which can be viewed in 3D and/or Virtual Reality. The same core IP has also been adapted for use with geological data allowing for 3D spatial visualisation of mineral exploration and production activities.

Since the Company’s heavily over-subscribed Initial Public Offering in February 2021, Singular Health has quickly transitioned into being a publicly listed Company with the IPO generating significant exposure for the Company’s technology, and providing the capital required to deliver on the Company’s two key strategic goals of developing better health literacy and delivering better health outcomes.

The exposure provided by listing on the ASX quickly resulted in the Company being presented with significant opportunities to accelerate the technical development of the software through the acquisition of the Virtual Surgical Planning software, and invest in long-term vertical integration through the investment in the Melbourne-based medical 3D printing facility owned by Australian Additive Engineering (“AAE”). The company continues to receive inbound enquiries from national and international medical companies.

Despite the ongoing coronavirus situation and restrictions on interstate and international travel, the entire team at Singular Health have worked exceptionally hard over the period to evolve the MedVR software into the scalable, hardware agnostic 3Dicom software. This software now operates across mobile, desktop and Virtual Reality platforms and has garnered significant interest as it consolidates previously siloed workflows into a Singular, cohesive end-to-end software platform for the Scan to Surgery process. In addition to releasing 3Dicom to Windows, Mac, Android, and iOS, the company released its Medical File Transfer Protocol, addressing a bottleneck in the transfer of Dicom files with a block chain backed, encrypted wireless transfer system.

We would like to thank Shareholders for their ongoing support, the Board for their guidance, as we look forward to an exciting year ahead.

Yours faithfully,



Howard Digby

Chairman

Singular Health Group Limited



Thomas Hanly

CEO/Managing Director
Singular Health Group Limited



The directors present their report, together with the consolidated financial statements, consisting of Singular Health Group Ltd (the "Company") and the entities it controlled (referred to hereafter as the "Group") at the end of, or during, the year ended 30 June 2021

## Directors

The following persons were directors of the Group during the whole of the financial year and up to the date of this report, unless otherwise stated:

Thomas Hanly
Prof. Kwang Guan Tay PhD
Denning Chong
Andrew Just (appointed 27 January 2021)
Howard Digby (appointed 27 January 2021)

Company Secretary

Steven Wood

## Principal activities

During the financial year the principal continuing activities of the Group consisted of:

• Development of Volumetric Rendering Platform (“VRP”) and derivative software solutions;

• Research and development activities;

• Sales and marketing of MedVR and 3 Dicom products; and.

• Capital Raising

The Group made significant progress in the development and domestic commercialisation of the 3Dicom product during the year with the acquisition of Virtual Surgical Planning (VSP) software, investment in a Melbourne-based medical 3D printing facility and a binding commitment to an enterprise licence agreement for 50 licences of the 3Dicom Virtual Surgical Planning software.

## Dividends

No dividends were paid during the financial year.

## Review of operations

The loss of the Group after providing for income tax amounted to $4,456,097 (30 June 2020: $707,588).

Operations during the period focused primarily on three key areas; further development of the Group’s proprietary Volumetric Rendering Platform, R&D activities relating to Artificial Intelligence, and Capital Raising through a pre-IPO convertible note and the Initial Public Offering.

## Development of Volumetric Rendering Platform

Just after the commencement of the period, Singular Health undertook an initial proof-of-concept project for FlowCentric Technologies (a mining software company) to investigate the use of the VRP towards visualising geological data. Following some adaptation, the VRP was able to visualise a mining block model and drill-hole data in a 3D environment which led to a formal $170,000 pilot project with FlowCentric Technologies in February 2021 (ASX Announcement 22nd February 2021: Purchase Order of $170,000 received for Software Development). The $170,000 was received during the period and Singular Health continues to engage with FlowCentric subsequent to the period with the objective of commercialising the GeoVR product.

Whilst GeoVR demonstrated the versatility of the Group’s core technology, the biggest advances made over the period were in the evolution of the MedVR software into the 3Dicom product. Due to the logistical and marketing challenges posed in the current situation, the development of 3Dicom as a software, which can be downloaded on end-users’ existing hardware, provides a much more scalable, capital efficient deployment of the advanced medical visualisation software.

The period saw a huge number of features added to the software, providing patients and especially medical practitioners with industry-standard tools in addition to the advanced 3D visualisation across both Windows and Mac computers. This strategic shift to developing a software only solution, as opposed to one requiring tethered VR headset, has enabled thousands of downloads of the freemium software providing a large amount feedback to inform the commercialisation and future development. This has been underpinned by highly successful Search Engine Optimisation (SEO) which has resulted in tens of downloads per day for negligible ongoing cost.



Post listing, Singular Health acquired the Virtual Surgical Planning software which works on a wireless Virtual Reality (VR) headset, the Oculus Quest 2, and will enable surgeons to manipulate segmented anatomy in VR to plan their cases and create patient-specific bio-models and surgical guides. The acquisition greatly accelerated the development of this feature set and has also provided a commercialisation opportunity through a license deal which will take force upon the full integration of the VSP software into 3Dicom.

The expansion of both the Group’s development team and the software itself during the Financial Year has provided the foundation for Scan to Surgery initiative and vertical integration of Virtual Surgical Planning, 3D Printing and integration of Artificial Intelligence.

## R&D Activities

Thanks to the continued efforts of Prof. Kwang Guan Tay PhD, Executive Director of Research and Innovation, the Group has engaged in numerous industry engagement programs and grant opportunities over the period. As a cost-effective way to access exceptional talent, Singular Health was fortunate enough to participate in multiple rounds of the APR Intern and iPrepWA programs which have provided subsidised internships for PhD students at the Group.

These internships have primarily focused on the development of Artificial Intelligence models for use within the 3Dicom software (subject to market approvals) and the creation of curriculum aligned health literacy content for the Group’s Virtual Anatomy & Health Academy products. Singular Health would like to thank all the APR Interns and iPrepWA participants for their contribution during the period.

In September 2020, Singular Health was successful in being awarded a CSIRO KickStart 1 grant, providing matched funding of $50,000 towards a project with the CSIRO. Utilising a publicly available dataset, Singular Health and CSIRO's Data61 collaborated on the development of a semi-automated spinal segmentation AI model which concluded in March 2021 (ASX Announcement 25th March 2021: CSIRO Artificial Intelligence Spinal Project Completion) and resulted in spinal vertebrae being automatically segmented within minutes with a greater than 95% level of accuracy.

Throughout the financial year, through academic relationships and persistent outreach, the Group collaborated with, numerous highly reputable educational institutions globally, including National University of Singapore, University of Western Australia, University of Sydney, Edith Cowan University and Curtin University. These relationships are ongoing and the Group is pleased with the level of academic engagement and R&D activity being conducted at a low cost-base.

## Capital Raising

With the period commencing in the midst of the Coronavirus pandemic and amid significant restrictions and work-from-home provisions, the Group was very well supported during this uncertain time by PAC Partners and numerous local shareholders and investors who invested into the Group through a convertible note during the initial quarter of the period.

Raising $1,025,000 through the convertible note through Q1 stabilised the Group and provided the necessary capital to reposition the development to adapt to COVID19 and to prepare and lodge the Group’s Prospectus in December 2020. The Group would like to thank all initial shareholders and convertible note holders for their contribution to the Group’s development and their unwavering support through the uncertainty of 2020.

The highlight of the period was the Initial Public Offering which, with the support of PAC Partners, was heavily oversubscribed following an almost entirely virtual raising process throughout the month of January with institutional investors, funds and High Net Worth investors around Australia. Raising $5,691,655 after costs, the IPO provides Singular Health with the necessary capital to fund development and commercialization and as at the end of the period, the Group retains a strong cash position of $4,135,691.

The IPO also saw the appointment of a new Non-Executive Chairman, Mr Howard Digby, and a Non-Executive Director, Mr Andrew Just.

## Significant changes in the state of affairs

The Group was admitted to the Official List of the ASX on Friday 12 February 2021

There were no significant changes in the state of affairs of the Group during the financial year, other than as noted above.



Matters subsequent to the end of the financial year
The following significant matters have occurred subsequent to 30 June 2021:

The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has been financially positive for the Group up to 30 June 2021, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided.

On 2 September 2021, Professor Jonathan Clark AM was appointed to Singular Health Group’s newly formed advisory board. In line with the Group’s vision of Developing Better Health Literacy, which spans improving patient education through to the design and manufacture of patient-specific surgical implants, Singular Health is pleased to announce the formation of an advisory board. The advisory Board will consist of key opinion leaders with a broad cross-section of academic, commercial, and crucially, clinical experience who will provide technical and clinical advice to guide the development, commercialization, and integration of Singular’s medical software solutions into standard medical workflows.

Apart from the matters discussed above, no other matter or circumstance has arisen since 30 June 2021 that has significantly affected, or may significantly affect the Group’s operations, the results of those operations, or the Group’s state of affairs in future financial years.

## Likely developments and expected results of operations

Other than as disclosed elsewhere in this report, there are no likely developments in the operations of the Group that were not finalised at the date of this report.

## Environmental regulation

The Group is not subject to any significant environmental regulation under Australian Commonwealth or State law.

## Information on directors

Name: Denning Chong
Title: Non-Executive Director
Qualifications: BSc, MBA
Experience and expertise: Denning Chong has been the principal of James Chong Lawyers since 2004. Denning has had the opportunity to assist across a broad spectrum of the community - from ASX listed companies and cross border type transactions, to local communities.

Denning holds positions with various prominent property development companies, including currently being a director of the Australian subsidiaries of a prominent SGX listed property developer, with a significant property portfolio.

He is also a director of a boutique venture capital business focusing on property, financial and medical technology sectors.

Denning is one of the founders of Singular Health and was involved in the early stage funding and governance of Singular Health since its incorporation.

Other current directorships of ASX

Listed Companies: None
Other directorships held in ASX

listed companies in the last three

years: None

Interests in shares: 4,380,000 ordinary shares
Interests in options: 4,500,000 unlisted options

Interests in performance rights: 2,400,000 performance rights



Name: Thomas Hanly
Title: Managing Director, Chief Executive Officer and Executive Director
Qualifications: BSc, BA, MBA
Experience and expertise: Holding a Bachelor's degree in resource and environmental economics, Thomas' early career saw him work as an economic analyst for AgricultureNZ before moving to the United States where he obtained his Series 7 and was employed in private banking with Merrill Lynch.

With a strong understanding of capital markets and an interest in technology, he was heavily involved in the early 2000's driving the development and commercialisation of a financial services start-up in the United States before returning to Australia.

Prior to joining Singular Health, Thomas has held a number of board positions of privately held companies in Australia and Singapore and has acted as an independent consultant assisting with the funding and commercialisation of innovative technologies. Recently, Thomas provided strategic technology transfer advice for the development of new acid leach membrane technology from Monash University and helped to develop carbon tax offset strategies with Calibre Group in Perth.

Other current directorships of ASX
Listed Companies:
Other directorships held in ASX
listed companies in the last three
years:
Interests in shares:
Interests in options:
Interests in performance rights:

Name:
Title:
Qualifications:
Experience and expertise:

None

None
3,500,001 ordinary shares
6,000,000 unlisted options
3,000,000 performance rights

Prof. Kwang Guan Tay PhD
Executive Director of Innovation and Research
B.Com, MBA, CA (Australia), FCA (England and Wales)

Holding a PhD from the Centre for Molecular Immunology and Instrumentation at the University of Western Australia for work completed at the Department of Clinical Immunology, Royal Perth Hospital, an MBA and Bachelor of Science (Biotechnology and Biological Sciences Double Major) with Honours (BSc(Hons)) from Murdoch University, Guan is highly respected in the medical and educational sectors.

Currently an Adjunct Associate Professor at the Faculty of Health and Medical Sciences at the University of Western Australia, Dr Tay has held various academic positions over the past 20 years (primarily in an adjunct or visiting capacity) at the University of Western Australia, as well as Edith Cowan University. Dr Tay has also managed significant projects at Khalifa University, the premier research-intensive university in Abu Dhabi, the United Arab Emirates.

Other current directorships of ASX
Listed Companies:
Other directorships held in ASX
listed companies in the last three
years:
Interests in shares:
Interests in options:
Interests in performance rights:
None

None
157,398 ordinary shares
3,000,000 unlisted options
300,000 performance rights



Name:
Title:
Qualifications:
Experience and expertise:

Andrew Just (appointed on 27 January 2021)

Non-Executive Director
BE, MBA

Graduating from Macquarie University with a Bachelor's degree in health economics, Business Law) and Monash University with a Bachelor's degree in health economics, Andrew Just was employed by Roche Pharmaceuticals as a Health Economist. He built economic models for inclusion of Roche products on the Australian Medical Benefits Scheme and then in GE Healthcare where he ultimately was appointed General Manager of Services for Australia and New Zealand leading a team of 152 staff.

He gained his MBA from the University of New South Wales and has since gained over 25 years of highly relevant global senior executive experience in the healthcare industry at Fortune 500 and ASX listed companies including Stryker, Cochlear, GE Healthcare, Radiometer, Roche, and Novartis.

Andrew has prior ASX experience having previously been the Chief Executive Officer and Managing Director of ASX listed Group Paragon Care Limited (ASX-PGC) and strong governance experience from previous roles and as a Graduate of the Australian Institute of Group Directors.

Other current directorships of ASX
Listed Companies:
Other directorships held in ASX
listed companies in the last three
years:
Interests in shares:
Interests in options:
Interests in performance rights:
None

Paragon Care Limited (31 May 2018 - 27 November 2019)

None

1,000,000 unlisted options

None



Singular Health Group Ltd
Directors' report
30 June 2021

Name:
Title:
Qualifications:
Experience and expertise:

Howard Digby (appointed on 27 January 2021)
Chairman and Non-Executive Director
BEng (Hons)
Howard Digby began his career at IBM and has spent over 25 years managing technology-related businesses in the Asia Pacific region, of which 11 years were spent in Hong Kong. Prior to returning to Perth, Howard was with The Economist Group as Regional Managing Director. He has also held senior regional management roles at Adobe and Gartner.

Howard holds a Bachelor of Engineering (Hons) from The University of Western Australia.

Currently a Non-Executive Director of 4DS Memory (ASX:4DS), Elsight (ASX:ELS), Cirralto (ASX:CRO), and previously a Non-Executive Director of ImeHXS (ASX:IME), Howard has strong ASX and corporate governance experience with technology and digital health companies.

Other current directorships of ASX
Listed Companies:

4DS Memory Ltd (7 December 2015 – present)
Elsight Ltd (13 December 2016 – present)
Cirralto Ltd (1 August 2019 – present)

Other directorships held in ASX listed companies in the last three years:
Interests in shares:
Interests in options:
Interests in performance rights:
IMEHXS Ltd (1 August 2018 – 30 April 2020)

Vortiv Ltd (13 November 2018 -19 April 2021)
85,000 ordinary shares

1,000,000 unlisted options

None

## Company secretary

The following person held the position of Company Secretary at the end of the financial year: Steven Wood

Steven Wood is a chartered accountant and corporate advisor with Grange Consulting Group. Steven started his career in the Perth office of Pitcher Partners where he spent several years in their corporate re-structuring division, working with listed and unlisted companies.

Steven provides corporate advisory, capital raising, Company secretarial and financial management services to a number of listed and unlisted businesses with projects in Australia and internationally. He has been involved in various private and seed capital raisings, successful ASX listings, and a variety of equity raising for ASX-listed entities.



## Meetings of directors

The number of meetings of the Board of Directors ('the Board') and of each Board committee held during the year ended 30 June 2021, and the number of meetings attended by each director were:

<table><tr><td>Director</td><td>Number of Board meetings Attended</td><td>Number of Board meetings eligible to attend</td></tr><tr><td>Thomas Hanly (Managing Director)</td><td>5</td><td>5</td></tr><tr><td>Prof. Kwang Guan Tay PhD</td><td>5</td><td>5</td></tr><tr><td>Denning Chong</td><td>5</td><td>5</td></tr><tr><td>Andrew Just</td><td>4</td><td>4</td></tr><tr><td>Howard Digby (Chairman)</td><td>4</td><td>4</td></tr></table>

The number of risk and audit committee meetings held, and the number of meetings attended by each of the Directors, for the year ended 30 June 2021 were:

<table><tr><td>Director</td><td>Number of risk and audit committee meetings eligible to attend</td><td>Number of risk and audit committee meetings attended</td></tr><tr><td>Howard Digby (Chairman)</td><td>-</td><td>-</td></tr><tr><td>Andrew Just</td><td>-</td><td>-</td></tr><tr><td>Denning Chong</td><td>-</td><td>-</td></tr></table>

As at the date of this report, the Company does not have a separately constituted Nomination and Remuneration Committee. The full Board acts as this committee under specific charters.

## Financial Position

The net assets of the consolidated Group have increased to $5,082,270 (2020: ($213,586)) as at 30 June 2021. The Group’s working capital, being current assets less current liabilities was $4,036,431.

## Shares under option and performance rights

Unissued ordinary shares of Singular Health Group Ltd under option and performance rights at the date of this report are as follows:

<table><tr><td>Security Type</td><td>Grant date</td><td>Expiry date</td><td>Exercise price</td><td>Number of Options</td><td>Number of Performance Rights</td></tr><tr><td>SHGPERFA24 - PERFORMANCE RIGHTS - CLASS A (ESC 24M)</td><td>12/02/2021</td><td>31/12/2023</td><td>$0.00</td><td>-</td><td>4,850,000</td></tr><tr><td>SHGPERF24 - PERFORMANCE RIGHTS - CLASS B (ESC 24M)</td><td>12/02/2021</td><td>31/12/2024</td><td>$0.00</td><td>-</td><td>4,850,000</td></tr><tr><td>SHGPERFA12 - PERFORMANCE RIGHTS - CLASS A (ESC 12M)</td><td>12/02/2021</td><td>31/12/2023</td><td>$0.00</td><td>-</td><td>150,000</td></tr><tr><td>SHGPERF12 - PERFORMANCE RIGHTS - CLASS B (ESC 12M)</td><td>12/02/2021</td><td>31/12/2024</td><td>$0.00</td><td>-</td><td>150,000</td></tr><tr><td>SHGOPT01 - UNLISTED OPTIONS @ $0.30 ESC 24M</td><td>12/02/2021</td><td>12/02/2025</td><td>$0.30</td><td>19,250,000</td><td>-</td></tr><tr><td></td><td></td><td></td><td>Total</td><td>19,250,000</td><td>10,000,000</td></tr></table>

No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of the Group or of any other body corporate.

## Shares issued on the exercise of options

There were no shares issued on the exercise of options during the year and up to the date of this report.



## Indemnity and insurance of officers

The Group has indemnified the directors and executives of the Group for costs incurred, in their capacity as a director or executive, for which they may be held personally liable, except where there is a lack of good faith.

During the financial year, the Group paid a premium in respect of a contract to insure the directors and executives of the Company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.

## Indemnity and insurance of auditor

The Group has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the Group or any related entity against a liability incurred by the auditor.

During the financial year, the Group has not paid a premium in respect of a contract to insure the auditor of the Group or any related entity.

## Proceedings on behalf of the Company

No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Group, or to intervene in any proceedings to which the Group is a party for the purpose of taking responsibility on behalf of the Group for all or part of those proceedings.

## Non-audit services

Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the auditor are outlined in note 21 to the financial statements.

The directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another person or firm on the auditor's behalf), is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001.

The directors are of the opinion that the services as disclosed in note 21 to the financial statements do not compromise the external auditor's independence requirements of the Corporations Act 2001 for the following reasons:

- all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of the auditor; and

- none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants issued by the Accounting Professional and Ethical Standards Board, including reviewing or auditing the auditor's own work, acting in a management or decision-making capacity for the Company, acting as advocate for the Company or jointly sharing economic risks and rewards.

## Rounding of amounts

The Group is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and Investments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that Corporations Instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.

## Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this directors' report.

## Remuneration report (audited)

The remuneration report details the key management personnel remuneration arrangements for the Group, in accordance with the requirements of the Corporations Act 2001 and its Regulations.

This is the first year that the entity has prepared a remuneration report as it is the Group’s first year as a listed Group. On this basis, the remuneration report does not contain comparative information for the year ended 30 June 2020. In addition, as there was no requirement to prepare a remuneration report in the prior year, no resolution was voted on at the 2020 annual general meeting (“AGM”).



Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including all directors.

The remuneration report is set out under the following main headings:

A Principles used to determine the nature and amount of remuneration

B Details of remuneration

C Service agreements

D Share-based compensation

E Additional disclosures relating to key management personnel

F Additional Information

## A. Principles used to determine the nature and amount of remuneration

The Board is of the opinion that the continued improved results can be attributed in part to the adoption of performance-based compensation and is satisfied that this improvement will continue to increase shareholder wealth if maintained over the coming years.

The reward framework is designed to align executive reward to shareholders' interests. The Board have considered that it should seek to enhance shareholders' interests by:

• having economic profit as a core component of plan design

- focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price, and delivering constant or increasing return on assets as well as focusing the executive on key non-financial drivers of value

• attracting and retaining high calibre executives

Additionally, the reward framework should seek to enhance executives' interests by:

• rewarding capability and experience

• reflecting competitive reward for contribution to growth in shareholder wealth

• providing a clear structure for earning rewards

In accordance with best practice corporate governance, the structure of non-executive director and executive director remuneration is separate.

## Group performance and link to remuneration

Remuneration for certain individuals is directly linked to the performance of the Group.

The relative proportions of remuneration that are linked to performance and those that are fixed are as follows:

<table><tr><td>Name</td><td>Fixed remuneration 2021</td><td>Performance based remuneration 2021</td></tr><tr><td>Thomas Hanly</td><td>84%</td><td>16%</td></tr><tr><td>Howard Digby</td><td>100%</td><td>Nil</td></tr><tr><td>Denning Chong</td><td>72%</td><td>28%</td></tr><tr><td>Prof. Kwang Guan Tay PhD</td><td>96%</td><td>4%</td></tr><tr><td>Andrew Just</td><td>100%</td><td>Nil</td></tr><tr><td>James Hill</td><td>87%</td><td>13%</td></tr><tr><td>Steven Wood</td><td>97%</td><td>3%</td></tr></table>

## Non-executive directors' remuneration

The Constitution and the ASX Listing Rules provides that the Non-Executive Directors will be paid by way of remuneration for their services as Directors a sum not exceeding such fixed sum per annum as may be determined by the Directors prior to the first annual general meeting of the Group or pursuant to a resolution passed at a general meeting of the Company (subject to complying with the Listing Rules)

Each Non-Executive Director receives a fee for being a Director of the Company. The remuneration of Non-Executive Directors for the period ended 30 June 2021 is detailed later in this report.

## Executive remuneration

The Company aims to reward executives based on their position and responsibility, with a level and mix of remuneration which has both fixed and variable components.



The executive remuneration and reward framework has four components:

• base pay and non-monetary benefits

• short-term performance incentives

• share-based payments

• other remuneration such as superannuation and long service leave

The combination of these comprises the executive's total remuneration.

Fixed remuneration, consisting of base salary, superannuation and non-monetary benefits, are reviewed annually by the Nomination and Remuneration Committee based on individual and business unit performance, the overall performance of the Company and comparable market remunerations.

Executives may receive their fixed remuneration in the form of cash or other fringe benefits (for example motor vehicle benefits) where it does not create any additional costs to the Company and provides additional value to the executive.

Short-term performance incentives ('STI') include cash and share-based payments. The objective of the STI program is to link the achievement of the Company's operational targets with the remuneration received by the executives charged with meeting those targets. The total potential STI available is set at a level to provide sufficient incentive to the executive to achieve those operational targets and such that the cost to the Company is reasonable in the circumstances.

Actual STI payments granted to executives depend on the extent to which specific targets, set at the beginning of the review period, being a calendar year, are met. The targets generally consist of a number of Key Performance Indicators (KPI's) covering both financial and non-financial, corporate and individual measures of performance. Typically included are measures such as contribution to development success, share price appreciation, risk management and cash flow sustainability. These measures were chosen as they represent the key drivers for the short-term success of the business and provide a framework for delivering long term value.

The Board has predetermined benchmarks that must be met in order to trigger payments under the STI scheme. On an annual basis, after consideration of performance against KPI's, the Board, acting as a Remuneration Committee, determines the amount, if any, of the STI to be paid to each executive. This process usually occurs in the first quarter of the following calendar year.

The long-term incentives ('LTI') include long service leave and share-based payments issued through participation in Singular's Employee Share Option and Performance Rights Plan. Shares options are granted based on continued service with the Company under the Employee Incentive Plan. During the year, Singular issued incentive options to directors and employees pursuant to the Employee Incentive Plan. The incentive options are subject to 24 months escrow with $0.30 exercise price and expiry four years from the issue date. Other than options disclosed in the remuneration report there have been no options issued to Directors and employees.

During the year, the Company issued performance rights to Directors and employees. The performance rights have nil exercise prices, are subject to 12 to 24 months escrow and will expire between three to four years from the issue date. The Performance rights will convert to ordinary shares on achievement of performance conditions as detailed in note 19.

Use of remuneration consultants

No remuneration consultants were employed during the financial year ended 30 June 2021.

## B. Details of remuneration

Amounts of remuneration

Details of the remuneration of key management personnel of the Company are set out in the following tables.

The key management personnel of the Company consisted of the following directors of Singular Health Group Ltd:

• Thomas Hanly

• Prof. Kwang Guan Tay PhD

• Denning Chong

Andrew Just (appointed 27 January 2021)

• Howard Digby (appointed 27 January 2021)

And the following key management personnel:

• James Hill

• Steven Wood



## Singular Health Group Ltd
Directors' report
30 June 2021

Details of the remuneration are set out in the tables below:

<table><tr><td></td><td colspan="3">Short-term benefits</td><td rowspan="2">Post-employment benefits</td><td rowspan="2">Long-term benefits</td><td rowspan="2">Share-based payments</td><td rowspan="2"></td></tr><tr><td></td><td colspan="3">Short-term benefits</td></tr><tr><td></td><td>Cash salary</td><td>Cash</td><td>Non-monetary</td><td>Super-annuation</td><td>Long service</td><td>Shares/ Options/ Performance rights</td><td>Total</td></tr><tr><td>2021</td><td>and fees</td><td>bonus</td><td>monetary</td><td></td><td>leave</td><td></td><td>$</td></tr><tr><td></td><td>$</td><td>$</td><td>$</td><td>$</td><td>$</td><td></td><td>$</td></tr><tr><td>Non-Executive Directors:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Howard Digby¹</td><td>18,839</td><td>-</td><td>-</td><td>-</td><td>-</td><td>23,346</td><td>42,185</td></tr><tr><td>Denning Chong³</td><td>57,558</td><td>-</td><td>-</td><td>1,462</td><td>-</td><td>170,055</td><td>229,075</td></tr><tr><td>Andrew Just²</td><td>16,615</td><td>-</td><td>-</td><td>1,578</td><td>-</td><td>23,346</td><td>41,539</td></tr><tr><td>Executive Directors:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Thomas Hanly⁴</td><td>283,495⁵</td><td>-</td><td>-</td><td>7,892</td><td>-</td><td>221,323</td><td>512,710</td></tr><tr><td>Prof. Kwang Guan</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Tay PhD</td><td>122,038</td><td>-</td><td>-</td><td>9,332</td><td>-</td><td>78,163</td><td>209,533</td></tr><tr><td>Other Key Management Personnel</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>James Hill</td><td>127,500</td><td>-</td><td>21,395</td><td>12,112</td><td>-</td><td>85,027</td><td>246,034</td></tr><tr><td>Steven Wood⁶</td><td>103,491</td><td>-</td><td>-</td><td>-</td><td>-</td><td>245,852</td><td>349,343</td></tr><tr><td></td><td>729,536</td><td>-</td><td>21,395</td><td>32,376</td><td>-</td><td>847,112</td><td>1,630,419</td></tr></table>

1. Represents remuneration from 27 January 2021 to 30 June 2021

2. Represents remuneration from 27 January 2021 to 30 June 2021

3. Salary was partly invoiced to the company by JDE Capital Pty Ltd in relation to Mr Chong’s role with the company.

4. Salary was partly invoiced to the company by Research Equity Pty Ltd in relation to Mr Hanly’s role with the company.

5. Mr Hanly received additional amounts during the period due to reduced payments in the 2020 financial year.

6. Fees were invoiced to the company by Grange Consulting Pty Ltd in relation to Mr Wood’s services to the company.



## C. Service agreements

Employment and Executive Services Agreements – Managing Director, Executive Director, and Chief Operating Officer
The Company has entered into an executive services agreement with Mr Thomas Hanly in respect of his employment as Managing Director, Prof. Kwang Guan Tay in respect of his employment as Executive Director of the Company (Executive Services Agreements), and Mr James Hill in respect of his employment as Chief Operating Officer of the Company (Employment Agreement).

<table><tr><td>Name</td><td>Base salary excluding superannuation</td><td>Termination benefit</td></tr><tr><td>Executive</td><td></td><td></td></tr><tr><td>Thomas Hanly (Managing Director)</td><td>AUD$216,000</td><td>Mr Hanly may terminate the agreement by giving six months&#x27; notice in writing to the Board and the Company may terminate at any time by also giving six months&#x27; written notice to Mr Hanly</td></tr><tr><td>Executive</td><td></td><td></td></tr><tr><td>Prof. Kwang Guan Tay PhD (Executive Director) Employee</td><td>AUD$180,000</td><td>Mr Tay may terminate the agreement by giving six months&#x27; notice in writing to the Board and the Company may terminate at any time by also giving six months&#x27; written notice to Mr Tay</td></tr><tr><td>James Hill (Chief Operating Officer)</td><td>AUD$132,000</td><td>Mr Hill may terminate the agreement by giving two weeks&#x27; notice in writing to the Board and the Company may terminate at any time by also giving two weeks&#x27; written notice to Mr Hill</td></tr></table>

## Company Secretarial Mandate - Grange Consulting Group

Mr. Steven Wood, the Company Secretary of the company, is also a director of Grange Consulting and an entity related to him is a shareholder of Grange Consulting.

Grange Consulting is engaged to provide company secretarial, corporate advisory and transaction management services. Pursuant to this engagement during the year ended 30 June 2021 Grange Consulting was entitled to receive $2,500 per month (plus GST) until the commencement of Public Offer due diligence, $10,000 per month (plus GST) from the commencement of the Public Offer due diligence committee process, $7,500 (plus GST) per month for the 6 months following Completion of the Public Offer and $5,000 (plus GST) per month subsequent to that, and 1,000,000 Shares in the capital of the Company upon the Prospectus being lodged with ASIC.

The Company will also be responsible for all incidental expenses incurred by Grange Consulting Group in providing its services. An administration fee of 5% is also payable on each invoice. This engagement can be terminated by either party giving 60 days' notice in writing.

The Mandate contains additional clause (including confidentiality and intellectual property) that are considered standard for an agreement of this nature.

## Non-executive directors

On appointment to the Board, all non-executive directors enter into a service agreement with the Company in the form of a letter of appointment. The letter summarises the Board’s policies and terms, including compensation, relevant to the director, and among other things:

- the terms of the directors appointment, including governance, compliance with the Company’s Constitution, committee appointments, and re-election;

- the directors duties, including disclosure obligations, exercising powers, use of office, attendance at meetings and commitment levels;

- the fees payable, in line with shareholder approval, any other terms, timing of payments and entitlements to reimbursements;

- insurance and indemnity;

- disclosure obligations; and

- confidentiality.



The following fees (plus superannuation) applied during the year:

<table><tr><td>Name</td><td>Base salary</td></tr><tr><td>Non-Executive</td><td></td></tr><tr><td>Howard Digby</td><td>AUD$50,000</td></tr><tr><td>Denning Chong</td><td>AUD$40,000</td></tr><tr><td>Andrew Just</td><td>AUD$40,000</td></tr></table>

## D. Share-based compensation

Issue of Shares
During the year, the Company issued fully paid ordinary shares to Company Secretary, Steven Wood, upon Singular’s prospectus being lodged with ASIC. The value of ordinary shares granted as part of compensation during the year ended 30 June 2021 are set out below:

<table><tr><td>Class of Securities</td><td>Grant date</td><td>Number of shares issued</td><td>Share Price</td><td>Total Fair Value ($)</td></tr><tr><td>Fully Paid Ordinary Shares</td><td>2 February 2021</td><td>1,000,000</td><td>$0.20</td><td>$200,000</td></tr></table>

## Issue of Options

Options granted carry no dividend or voting rights.

All options were granted over unissued fully paid ordinary shares in the Company. Options vest based on the provision of service over the vesting period whereby the executive becomes beneficially entitled to the option on vesting date. Options are exercisable by the holder as from the vesting date. There has not been any alteration to the terms or conditions of the grant since the grant date. There are no amounts paid or payable by the recipient in relation to the granting of such options other than on their potential exercise.

Values of options over ordinary shares granted, exercised, and lapsed for directors and other key management personnel as part of compensation during the year ended 30 June 2021 are set out below:

<table><tr><td></td><td></td><td>Value of options granted during the year</td><td>Value of options exercised during the year</td><td>Value of options lapsed during the year</td><td>Remuneration consisting of options for the year</td></tr><tr><td>Name</td><td></td><td>$</td><td>$</td><td>$</td><td>%</td></tr><tr><td>Thomas Hanly</td><td></td><td>140,078</td><td>-</td><td>-</td><td>27%</td></tr><tr><td>Prof. Kwang Guan Tay PhD</td><td></td><td>70,039</td><td>-</td><td>-</td><td>33%</td></tr><tr><td>Denning Chong</td><td></td><td>105,058</td><td>-</td><td>-</td><td>46%</td></tr><tr><td>Andrew Just</td><td></td><td>23,346</td><td>-</td><td>-</td><td>56%</td></tr><tr><td>Howard Digby</td><td></td><td>23,347</td><td>-</td><td>-</td><td>55%</td></tr><tr><td>James Hill</td><td></td><td>52,529</td><td>-</td><td>-</td><td>21%</td></tr><tr><td>Steven Wood</td><td></td><td>35,019</td><td>-</td><td>-</td><td>10%</td></tr></table>

The Options were valued using a Black-Scholes Model with the following inputs:

<table><tr><td>Class of Securities</td><td>Dividend Yield</td><td>Valuation Date</td><td>Expected Volatility</td><td>Risk-Free Interest Rate</td><td>Expiry</td><td>Underlying Share Price</td><td>Value per Option ($)</td><td>Total Fair Value ($)</td></tr><tr><td>KMP Incentive Options</td><td>Nil</td><td>12 February 2021</td><td>100%</td><td>0.26%</td><td>4 years from issue date</td><td>$0.20</td><td>$0.0124</td><td>$2,377,346</td></tr></table>



## Issue of Performance Rights

Values of performance rights granted, vested, and forfeited for directors and other key management personnel as part of compensation during the year ended 30 June 2021 are set out below:

<table><tr><td></td><td>Value of Performance rights granted during the year</td><td>Value of Performance rights vested during the year</td><td>Value of Performance rights forfeited during the year</td><td>Remuneration consisting of Performance rights for the year %</td></tr><tr><td>Name</td><td>$</td><td>$</td><td>$</td><td></td></tr><tr><td>Thomas Hanly</td><td>81,245</td><td>-</td><td>-</td><td>16%</td></tr><tr><td>Prof. Kwang Guan Tay PhD</td><td>8,125</td><td>-</td><td>-</td><td>4%</td></tr><tr><td>Denning Chong</td><td>64,996</td><td>-</td><td>-</td><td>28%</td></tr><tr><td>Andrew Just</td><td>-</td><td>-</td><td>-</td><td>0%</td></tr><tr><td>Howard Digby</td><td>-</td><td>-</td><td>-</td><td>0%</td></tr><tr><td>James Hill</td><td>32,498</td><td>-</td><td>-</td><td>13%</td></tr><tr><td>Steven Wood</td><td>10,833</td><td>-</td><td>-</td><td>3%</td></tr></table>

The performance conditions for the Performance Rights are set out below:

<table><tr><td>Class of Performance Rights</td><td>Performance Milestones</td></tr><tr><td>Class A Performance Rights</td><td>The Shares are admitted to the Official List of ASX; AND
The company achieves a Gross Revenue of at least $1.25m for the 2022-2023 financial year.</td></tr><tr><td>Class B Performance Rights</td><td>The Shares are admitted to the Official List of ASX; AND
The company achieves a Gross Revenue of at least $2.5m for the 2023-2024 financial year.</td></tr></table>

## E. Additional disclosures relating to key management personnel

## Shareholding

The number of shares in the Company held during the financial year by each director and other members of key management personnel of the Company, including their personally related parties, is set out below:

<table><tr><td></td><td>Balance at the start of the year</td><td>Received as part of remuneration</td><td>Additions</td><td>Disposals/ other</td><td>Balance at the end of the year</td></tr><tr><td>Ordinary shares</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Thomas Hanly</td><td>1</td><td>-</td><td>3,500,000</td><td>-</td><td>3,500,001</td></tr><tr><td>Prof. Kwang Guan Tay PhD</td><td>-</td><td>-</td><td>157,398</td><td>-</td><td>157,398</td></tr><tr><td>Denning Chong</td><td>-</td><td>-</td><td>4,380,000</td><td>-</td><td>4,380,000</td></tr><tr><td>Andrew Just</td><td>-</td><td>-</td><td>-</td><td>-</td><td>-</td></tr><tr><td>Howard Digby</td><td>-</td><td>-</td><td>85,000</td><td>-</td><td>85,000</td></tr><tr><td>James Hill</td><td>820,000</td><td>-</td><td>10,000</td><td>-</td><td>830,000</td></tr><tr><td>Steven Wood (held in Grange Consulting)</td><td>-</td><td>1,000,000</td><td>25,000</td><td>-</td><td>1,025,000</td></tr><tr><td></td><td>820,001</td><td>1,000,000</td><td>8,157,398</td><td>-</td><td>9,977,399</td></tr></table>



## Singular Health Group Ltd
Directors' report
30 June 2021

## Option holding

The number of options over ordinary shares in the Company held during the financial year by each director and other members of key management personnel of the Company, including their personally related parties, is set out below:

<table><tr><td></td><td>Balance at the start of the year</td><td>Granted</td><td>Exercised</td><td>Expired/ forfeited/ other</td><td>Balance at the end of the year</td></tr><tr><td>Options over ordinary shares</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Thomas Hanly</td><td>-</td><td>6,000,000</td><td>-</td><td>-</td><td>6,000,000</td></tr><tr><td>Prof. Kwang Guan Tay PhD</td><td>-</td><td>3,000,000</td><td>-</td><td>-</td><td>3,000,000</td></tr><tr><td>Denning Chong</td><td>-</td><td>4,500,000</td><td>-</td><td>-</td><td>4,500,000</td></tr><tr><td>Andrew Just</td><td>-</td><td>1,000,000</td><td>-</td><td>-</td><td>1,000,000</td></tr><tr><td>Howard Digby</td><td>-</td><td>1,000,000</td><td>-</td><td>-</td><td>1.000,000</td></tr><tr><td>James Hill</td><td>-</td><td>2,250,000</td><td>-</td><td>-</td><td>2,250,000</td></tr><tr><td>Steven Wood</td><td>-</td><td>1,500,000</td><td>-</td><td>-</td><td>1,500,000</td></tr><tr><td></td><td>-</td><td>19,250,000</td><td>-</td><td>-</td><td>19,250,000</td></tr></table>

## Performance Rights Holding

The number of Performance Rights of the Company held, directly, indirectly, or beneficially, by each Director and key management personnel, including their personally-related entities for the year ended 30 June 2021 are as follows:

<table><tr><td></td><td>Balance at the start of the year</td><td>Received as part of remuneration</td><td>Exercised</td><td>Other changes</td><td>Balance at the end of the year</td></tr><tr><td>Performance rights</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Thomas Hanly \( ^{1} \)</td><td>-</td><td>3,000,000</td><td>-</td><td>-</td><td>3,000,000</td></tr><tr><td>Prof. Kwang Guan Tay PhD \( ^{2} \)</td><td>-</td><td>300,000</td><td>-</td><td>-</td><td>300,000</td></tr><tr><td>Denning Chong \( ^{3} \)</td><td>-</td><td>2,400,000</td><td>-</td><td>-</td><td>2,400,000</td></tr><tr><td>Andrew Just</td><td>-</td><td>-</td><td>-</td><td>-</td><td>-</td></tr><tr><td>Howard Digby</td><td>-</td><td>-</td><td>-</td><td>-</td><td>-</td></tr><tr><td>James Hill \( ^{4} \)</td><td>-</td><td>1,200,000</td><td>-</td><td>-</td><td>1,200,000</td></tr><tr><td>Steven Wood \( ^{5} \)</td><td>-</td><td>400,000</td><td>-</td><td>-</td><td>400,000</td></tr><tr><td></td><td>-</td><td>7,300,000</td><td>-</td><td>-</td><td>7,300,000</td></tr></table>

1. Thomas Hanly was issued 1,500,000 Class A Performance Rights and 1,500,000 Class B Performance rights under the company's Performance Rights Plan upon IPO on 12 February 2021.

2. Prof. Kwang Guan Tay PhD was issued 150,000 Class A Performance Rights and 150,000 Class B Performance rights under the company's Performance Rights Plan upon IPO on 12 February 2021.

3. Denning Chong was issued 1,200,000 Class A Performance Rights and 1,200,000 Class B Performance rights under the company's Performance Rights Plan upon IPO on 12 February 2021.

4. James Hill was issued 600,000 Class A Performance Rights and 600,000 class B Performance rights under the company's Performance Rights Plan under IPO on 12 February 2021.

5. Steven Wood was issued 200,000 Class A Performance Rights and 200,000 Class B Performance rights under the company's Performance Rights Plan under IPO on 12 February 2021.



## Singular Health Group Ltd
Directors' report
30 June 2021

Other transactions with key management personnel and their related parties
JDE Capital Pty Ltd, a company associated with Denning Chong, received $30,750 excluding GST (2020: $3,300) during the period for non-executive director services provided to the Company, with $nil payable as at 30 June 2021.

Research Equity Pty Ltd, a company associated with Thomas Hanly, received $200,418 excluding GST (2020: $174,996) in fees during the period for executive director services provided to the Company, with $nil payable as at 30 June 2021.

James Chong and Co Pty Ltd, a company associated with Denning Chong, received $8,423 excluding GST (2020: \)nil) in fees during the period for legal services provided to the Company, with $nil payable as at 30 June 2021.

Re-Energise Digital, a company associated with James Hill, received $57,680 excluding GST (2020: $10,549) in fees during the period for marketing services to the Company including typesetting and preparation of the Prospectus, with $4,158 payable at 30 June 2021.

Grange Consulting, a company associated with Steven Wood, received $103,491 excluding GST (2020: $19,163) in fees during the period for financial services, company secretarial work and corporate advisory services, with $nil payable at 30 June 2021.

Loans outstanding at the end of the current and prior year include an unsecured loan to a director of Singular Health Group Limited of $1,545 (2020: $155,941) with no fixed terms of repayment. Interest is payable on this loan at the rate of 5% (2020: 5%) per annum.

## Terms and conditions

All transactions with key management personnel and their related parties were made on normal commercial terms and conditions and at market rates.

## F. Additional Information

Voting and comments made at the Company Annual General Meeting

The Company was incorporated on 20 February 2020, and listed on the ASX on 12 February 2021. The AGM of Singular Health Group Limited shareholders is yet to be held.

This concludes the remuneration report, which has been audited.

This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act 2001.

On behalf of the directors



Thomas Hanly
Director

30 September 2021
Perth



Level 15, Exchange Tower,
2 The Esplanade, Perth, WA 6000
PO Box 5785, St Georges Terrace, WA 6831

T +61 8 9225 5355

F +61 8 9225 6181

www.moore-australia.com.au

AUDITOR'S INDEPENDENCE DECLARATION
UNDER S307C OF THE CORPORATIONS ACT 2001
TO THE DIRECTORS OF SINGULAR HEALTH GROUP LTD

I declare that, to the best of my knowledge and belief, during the year ended 30 June 2021 there have been no contraventions of:

i. the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and

ii. any applicable code of professional conduct in relation to the audit.



PARTNER



Signed at Perth this 30 \( ^{th} \)  day of September 2021



Consolidated Statement of profit or loss and other comprehensive income 21
Consolidated Statement of financial position 22
Consolidated Statement of changes in equity 23
Consolidated Statement of cash flows 24
Notes to the consolidated financial statements 25
Directors' declaration 56
Independent auditor's report to the members of Singular Health Group Ltd 57
Corporate Governance Statement 61
Shareholder information 62

## General information

The financial statements cover Singular Health Group Ltd and its subsidiaries. The financial statements are presented in Australian dollars, which is Singular Health Group Ltd's functional and presentation currency.

Singular Health Group Ltd is a listed public Company limited by shares, incorporated, and domiciled in Australia. Its registered office and principal place of business are:

Registered office

c/o – Grange Consulting Pty Ltd

945 Wellington Street

West Perth WA 6005

Principal place of business

3/26 Railway Road

Subiaco, Western Australia 6008

Phone: 1300 167 795

A description of the nature of the Company’s operations and its principal activities are included in the directors' report, which is not part of the financial statements.

The financial statements were authorised for issue, in accordance with a resolution of directors, on 30 September 2021. The directors have the power to amend and reissue the financial statements.



## Singular Health Group Ltd
Consolidated statement of profit or loss and other comprehensive income
For the year ended 30 June 2021

<table><tr><td></td><td>Note</td><td>2021 \(</td><td>2020 \)</td></tr><tr><td>Revenue</td><td>4</td><td>193,643</td><td>105,922</td></tr><tr><td>Research and Development grant income</td><td>4</td><td>262,700</td><td>-</td></tr><tr><td>Interest and other revenue</td><td>4</td><td>117,354</td><td>24,066</td></tr><tr><td>Expenses</td><td></td><td></td><td></td></tr><tr><td>Selling and marketing expenses</td><td></td><td>(149,366)</td><td>(9,318)</td></tr><tr><td>Patent, research and development expenses</td><td></td><td>(189,768)</td><td>(3,399)</td></tr><tr><td>Consultancy and subcontractor fees</td><td></td><td>(801,539)</td><td>(326,623)</td></tr><tr><td>Employee and director benefits expense</td><td></td><td>(878,645)</td><td>(222,258)</td></tr><tr><td>Accountancy, audit and legal expenses</td><td></td><td>(370,565)</td><td>(48,153)</td></tr><tr><td>Depreciation and amortisation</td><td></td><td>(130,691)</td><td>(29,171)</td></tr><tr><td>Administration expenses</td><td></td><td>(249,310)</td><td>(138,362)</td></tr><tr><td>Share based payments</td><td>19</td><td>(720,234)</td><td>-</td></tr><tr><td>Finance costs</td><td>5</td><td>(1,464,382)</td><td>(55,423)</td></tr><tr><td>Share of net loss in associates</td><td>26</td><td>(4,136)</td><td>-</td></tr><tr><td>Other Expenses</td><td></td><td>(71,158)</td><td>(4,869)</td></tr><tr><td>Loss before income tax expense</td><td></td><td>(4,456,097)</td><td>(707,588)</td></tr><tr><td>Income tax expense</td><td>6</td><td>-</td><td>-</td></tr><tr><td>Profit after income tax expense for the year</td><td></td><td>(4,456,097)</td><td>(707,588)</td></tr><tr><td>Other comprehensive income</td><td></td><td></td><td></td></tr><tr><td>Items that may be reclassified subsequently to profit or loss</td><td></td><td></td><td></td></tr><tr><td>Exchange differences on translation of foreign operations, net of tax</td><td></td><td>5,050</td><td>-</td></tr><tr><td>Other comprehensive income for the year, net of tax</td><td></td><td>5,050</td><td>-</td></tr><tr><td>Total comprehensive income for the year</td><td></td><td>(4,451,047)</td><td>(707,588)</td></tr></table>

<table><tr><td></td><td>Cents</td><td>Cents</td></tr><tr><td>Loss per share</td><td></td><td></td></tr><tr><td>Basic loss per share</td><td>29</td><td>(6.02)</td></tr><tr><td>Diluted loss per share</td><td>29</td><td>(6.02)</td></tr></table>



<table><tr><td></td><td>Note</td><td>2021</td><td>2020</td></tr><tr><td></td><td></td><td>$</td><td>$</td></tr><tr><td>Assets</td><td></td><td></td><td></td></tr><tr><td>Current assets</td><td></td><td></td><td></td></tr><tr><td>Cash and cash equivalents</td><td>7</td><td>4,135,691</td><td>130,552</td></tr><tr><td>Trade and other receivables</td><td>8</td><td>152,119</td><td>70,391</td></tr><tr><td>Prepayments</td><td></td><td>9,181</td><td>-</td></tr><tr><td>Prepaid Interest on Convertible Notes</td><td></td><td>-</td><td>240,390</td></tr><tr><td>Total current assets</td><td></td><td>4,296,991</td><td>441,333</td></tr><tr><td>Non-current assets</td><td></td><td></td><td></td></tr><tr><td>Property, plant and equipment</td><td>10</td><td>63,358</td><td>27,691</td></tr><tr><td>Right-of-use assets</td><td>11</td><td>133,265</td><td>-</td></tr><tr><td>Intangibles</td><td>9</td><td>637,893</td><td>199,245</td></tr><tr><td>Investment in associates</td><td>26</td><td>295,864</td><td>-</td></tr><tr><td>Total non-current assets</td><td></td><td>1,130,380</td><td>226,936</td></tr><tr><td>Total assets</td><td></td><td>5,427,371</td><td>668,269</td></tr><tr><td>Liabilities</td><td></td><td></td><td></td></tr><tr><td>Current liabilities</td><td></td><td></td><td></td></tr><tr><td>Trade and other payables</td><td>12</td><td>(148,328)</td><td>(129,797)</td></tr><tr><td>Provisions</td><td>13</td><td>(49,184)</td><td>(6,117)</td></tr><tr><td>Borrowings</td><td>14</td><td>(1,545)</td><td>(155,941)</td></tr><tr><td>Convertible notes</td><td>15</td><td>-</td><td>(590,000)</td></tr><tr><td>Other current liabilities</td><td>11</td><td>(61,503)</td><td>-</td></tr><tr><td>Total current liabilities</td><td></td><td>(260,560)</td><td>(881,855)</td></tr><tr><td>Non-current liabilities</td><td></td><td></td><td></td></tr><tr><td>Lease liabilities</td><td>11</td><td>(84,541)</td><td>-</td></tr><tr><td>Total non-current liabilities</td><td></td><td>(84,541)</td><td>-</td></tr><tr><td>Total liabilities</td><td></td><td>(345,101)</td><td>(881,855)</td></tr><tr><td>Net assets/(liabilities)</td><td></td><td>5,082,270</td><td>(213,586)</td></tr><tr><td>Equity</td><td></td><td></td><td></td></tr><tr><td>Issued capital</td><td>16</td><td>9,526,669</td><td>500,000</td></tr><tr><td>Reserves</td><td>17</td><td>719,286</td><td>(5,998)</td></tr><tr><td>Accumulated losses</td><td>18</td><td>(5,163,685)</td><td>(707,588)</td></tr><tr><td>Total equity</td><td></td><td>5,082,270</td><td>(213,586)</td></tr></table>



Singular Health Group Ltd
Consolidated Statement of changes in equity
For the year ended 30 June 2021

<table><tr><td></td><td>Issued Capital</td><td>Share-based Payment Reserve</td><td>Accumulated Losses</td><td>Foreign Currency Translation Reserve</td><td>Total</td></tr><tr><td></td><td>$</td><td>$</td><td>$</td><td>$</td><td>$</td></tr><tr><td>Balance at 1 July 2019</td><td>-</td><td>-</td><td>-</td><td>-</td><td>-</td></tr><tr><td>Loss for the year</td><td>-</td><td>-</td><td>(707,588)</td><td>-</td><td>(707,588)</td></tr><tr><td>Total other comprehensive income</td><td>-</td><td>-</td><td>-</td><td>(5,998)</td><td>(5,998)</td></tr><tr><td>Total comprehensive loss for the year</td><td>-</td><td>-</td><td>(707,588)</td><td>(5,998)</td><td>(713,586)</td></tr><tr><td>Transaction with owners, directly recorded in equity:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Issue of Ordinary Shares, net of transaction costs</td><td>500,000</td><td>-</td><td>-</td><td>-</td><td>500,000</td></tr><tr><td>Total transactions with owners</td><td>500,000</td><td>-</td><td>-</td><td>-</td><td>500,000</td><tr><td>Balance at 30 June 2020</td><td>500,000</td><td>-</td><td>(707,588)</td><td>(5,998)</td><td>(213,586)</td></tr><tr><td></td><td>Issued Capital</td><td>Share-based Payment Reserve</td><td>Accumulated Losses</td><td>Foreign Currency Translation Reserve</td><td>Total</td></tr><tr><td></td><td>$</td><td>$</td><td>$</td><td>$</td><td>$</td></tr><tr><td>Balance at 1 July 2020</td><td>500,000</td><td>-</td><td>(707,588)</td><td>(5,998)</td><td>(213,586)</td></tr><tr><td>Loss for the year</td><td>-</td><td>-</td><td>(4,456,097)</td><td>-</td><td>(4,456,097)</td></tr><tr><td>Total other comprehensive income</td><td>-</td><td>-</td><td>-</td><td>5,050</td><td>5,050</td></tr><tr><td>Total comprehensive loss for the year</td><td>-</td><td>-</td><td>(4,456,097)</td><td>5,050</td><td>(4,451,047)</td></tr><tr><td>Transaction with owners, directly recorded in equity:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Issue of Ordinary Shares, net of transaction costs</td><td>5,330,592</td><td>-</td><td>-</td><td>-</td><td>5,330,592</td></tr><tr><td>Share issued on conversion of Convertible Notes (note 15,16)</td><td>2,846,077</td><td>-</td><td>-</td><td>-</td><td>2,846,077</td></tr><tr><td>Share based payments (note 16, 19)</td><td>850,000</td><td>720,234</td><td>-</td><td>-</td><td>1,570,234</td></tr><tr><td>Total transactions with owners</td><td>9,026,669</td><td>720,234</td><td>-</td><td>-</td><td>9,746,903</td></tr><tr><td>Balance at 30 June 2021</td><td>9,526,669</td><td>720,234</td><td>(5,163,685)</td><td>(948)</td><td>5,082,270</td></tr></td></tr></table>



<table><tr><td></td><td>Note</td><td>2021\(</td><td>2020\)</td></tr><tr><td>Cash flows from operating activities</td><td></td><td></td><td></td></tr><tr><td>Receipts from customers</td><td></td><td>111,915</td><td>32,520</td></tr><tr><td>Payments to suppliers and employees</td><td></td><td>(2,399,133)</td><td>(580,689)</td></tr><tr><td>Government grants received</td><td></td><td>377,810</td><td>-</td></tr><tr><td>Interest (paid)/received</td><td></td><td>2,244</td><td>-</td></tr><tr><td>Net cash flows (used in) operating activities</td><td>27</td><td>(1,907,164)</td><td>(548,169)</td></tr><tr><td>Cash flows from investing activities</td><td></td><td></td><td></td></tr><tr><td>Purchase of plant &amp; equipment</td><td></td><td>(50,486)</td><td>-</td></tr><tr><td>Payments for intangible assets</td><td></td><td>(260,082)</td><td>(31,603)</td></tr><tr><td>Payments for acquisition of associates</td><td></td><td>(300,000)</td><td>(227,708)</td></tr><tr><td>Net cash flows (used in) investing activities</td><td></td><td>(610,568)</td><td>(259,311)</td></tr><tr><td>Cash flows from financing activities</td><td></td><td></td><td></td></tr><tr><td>Proceeds from issue of shares, net of issue costs</td><td></td><td>5,691,655</td><td>500,000</td></tr><tr><td>Proceeds from issue of convertible notes</td><td></td><td>1,025,000</td><td>295,000</td></tr><tr><td>Proceeds from borrowings</td><td></td><td>(154,396)</td><td>155,692</td></tr><tr><td>Payment of principle portion of lease liabilities</td><td></td><td>(44,438)</td><td>-</td></tr><tr><td>Net cash from/(used) in financing activities</td><td></td><td>6,517,821</td><td>950,692</td></tr><tr><td>Net increase/(decrease) in cash and cash equivalents</td><td></td><td>4,000,089</td><td>143,212</td></tr><tr><td>Cash and cash equivalents at the beginning of the financial year</td><td></td><td>130,552</td><td>-</td></tr><tr><td>Effects of exchange rate changes on cash and cash equivalents</td><td></td><td>5050</td><td>(12,660)</td></tr><tr><td>Cash and cash equivalents at the end of the financial year</td><td>7</td><td>4,135,691</td><td>130,552</td></tr></table>



## NOTE 1. SIGNIFICANT ACCOUNTING POLICIES

## General Information

The Company was incorporated on 20 February 2020. The principal activity of the Company is investment holding.

Singular Health Pte Ltd (incorporated in Singapore) and Singular Health Pty Ltd (incorporated in Australia) were incorporated in September 2019. Singular Health Pte Ltd acquired the intellectual property and software development associated with the MedVR technology from MedVR Pty Ltd for cash of $230,000 effective 30 September 2020. On 21 March 2021, the Company and Australian Additive Engineering Pty Ltd (AAE) entered into a share subscription deed where SHG subscribed to 25% of AAE's share capital for a subscription price of $300,000. The acquisition was approved by shareholders at the General Meeting held on 11 May 2021.

The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

## New or amended Accounting Standards and Interpretations adopted

The Company has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.

Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.

The following Accounting Standards and Interpretations are most relevant to the Company:

## Conceptual Framework for Financial Reporting (Conceptual Framework)

The Company has adopted the revised Conceptual Framework from 1 July 2020. The Conceptual Framework contains new definition and recognition criteria as well as new guidance on measurement that affects several Accounting Standards, but it has not had a material impact on the Company’s financial statements.

## Standards Issued but not yet effective

The AASB has issued a number of new and amended Accounting Standards and Interpretations that have mandatory application dates for future reporting periods, some of which are relevant to the Company. The Company has decided not to early adopt any of the new and amended pronouncements. The Company’s assessment of the new and amended pronouncements that are relevant to the Company but applicable in future reporting periods is set out below:

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the consolidated entity for the annual reporting period ended 30 June 2021. The consolidated entity has not yet assessed the impact of these new or amended Accounting Standards and Interpretations.

## Basis of preparation

These general-purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate for for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board ('IASB').

## Historical cost convention

The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation of financial assets and liabilities at fair value through profit or loss, financial assets at fair value through other comprehensive income, investment properties, certain classes of property, plant and equipment and derivative financial instruments.

## Comparatives

Singular Health Pte Ltd (incorporated in Singapore) and Singular Health Pty Ltd (incorporated in Australia) were incorporated in September 2019. As such, the comparative information is for the period 1 September 2019 to 30 June 2020.

## Critical accounting estimates

The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company’ accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 3.



## Principles of consolidation

The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Singular Health Group Ltd ('Company" or 'parent entity') as at 30 June 2021 and the results of all subsidiaries for the year then ended. Singular Health Group Ltd and its subsidiaries together are referred to in these financial statements as the 'Group'.

Subsidiaries are all those entities over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are de-consolidated from the date that control ceases.

Intercompany transactions, balances and unrealised gains on transactions between entities in the Group are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred.

The acquisition of subsidiaries is accounted for using the acquisition method of accounting.

Non-controlling interest in the results and equity of subsidiaries are shown separately in the statement of profit or loss and other comprehensive income, statement of financial position and statement of changes in equity 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.

## Foreign currency translation

The financial statements are presented in Australian dollars, which is Singular Health Group Ltd's functional and presentation currency.

## Foreign currency transactions

Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss.

## Foreign operations

The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity.

The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of.

## Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes and duty.

Revenue is recognised in the statement of comprehensive income to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognised will not occur and the revenue and costs, if applicable, can be measured reliably. The following criteria must also be met before turnover is recognised.

## Sale of goods

Revenue from the sale of goods is recognised when the goods are delivered and the titles have passed, at which time all the following conditions are satisfied:

• The Group has transferred the significant risks and rewards of ownership to the buyer;

• The Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;

• The amount of revenue can be measured reliably;

• It is probable that the Group will receive the consideration due under the transaction; and

• The costs incurred or to be incurred in respect of the transaction can be measured reliably.

## Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the conditions are satisfied:

• The amount of revenue can be measured reliably;



• It is probable that the Group will receive the consideration due under the contract;

• The stage of completion of the contract at the end of the reporting period can be measured reliably; and

• The costs incurred and the costs to complete the contract can be measured reliably

## Income tax

The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary differences, unused tax losses and the adjustment recognised for prior periods, where applicable.

Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for:

• When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits; or
• When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future.

Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to recover the asset.

Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on either the same taxable entity or different taxable entities which intend to settle simultaneously.

## Current and non-current classification

Assets and liabilities are presented in the statement of financial position based on current and non-current classification.

An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Group's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are classified as non-current.

A liability is classified as current when: it is either expected to be settled in the Group’s normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current.

Deferred tax assets and liabilities are always classified as non-current.

## Cash and cash equivalents

Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. For the statement of cash flows presentation purposes, cash and cash equivalents also includes bank overdrafts, which are shown within borrowings in current liabilities on the statement of financial position.

## Trade and other receivables

Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days.

The Group has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue.



Other receivables are recognised at amortised cost, less any allowance for expected credit losses.

## Associates

Associates are entities over which the Group has significant influence but not control or joint control. Investments in associates are accounted for using the equity method. Under the equity method, the share of the profits or losses of the associate is recognised in profit or loss and the share of the movements in equity is recognised in other comprehensive income. Investments in associates are carried in the statement of financial position at cost plus post-acquisition changes in the Group's share of net assets of the associate. Goodwill relating to the associate is included in the carrying amount of the investment and is neither amortised nor individually tested for impairment. Dividends received or receivable from associates reduce the carrying amount of the investment.

When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any unsecured long-term receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

The Group discontinues the use of the equity method upon the loss of significant influence over the associate and recognises any retained investment at its fair value. Any difference between the associate's carrying amount, fair value of the retained investment and proceeds from disposal is recognised in profit or loss.

## Investments and other financial assets

Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either amortised cost or fair value depending on their classification. Classification is determined based on both the business model within which such assets are held and the contractual cash flow characteristics of the financial asset unless an accounting mismatch is being avoided.

Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of recovering part or all of a financial asset, its carrying value is written off.

## Financial assets at fair value through profit or loss

Financial assets not measured at amortised cost or at fair value through other comprehensive income are classified as financial assets at fair value through profit or loss. Typically, such financial assets will be either: (i) held for trading, where they are acquired for the purpose of selling in the short-term with an intention of making a profit, or a derivative; or (ii) designated as such upon initial recognition where permitted. Fair value movements are recognised in profit or loss.

## Financial assets at fair value through other comprehensive income

Financial assets at fair value through other comprehensive income include equity investments which the Group intends to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition.

## Impairment of financial assets

The Group recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon the Group’s assessment at the end of each reporting period as to whether the financial instrument’s credit risk has increased significantly since initial recognition, based on reasonable and supportable information that is available, without undue cost or effort to obtain.

Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate.

For financial assets mandatorily measured at fair value through other comprehensive income, the loss allowance is recognised in other comprehensive income with a corresponding expense through profit or loss. In all other cases, the loss allowance reduces the asset's carrying value with a corresponding expense through profit or loss.



## Property, plant and equipment

Property, Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment (excluding land) over their expected useful lives as follows:

<table><tr><td>Leasehold improvements</td><td>3-10 years</td></tr><tr><td>Plant and equipment</td><td>3-7 years</td></tr><tr><td>Plant and equipment under lease</td><td>2-5 years</td></tr></table>

The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date.

Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the assets, whichever is shorter.

An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the Group. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss.

## Right-of-use assets

A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset.

Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter. Where the Group expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-of-use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.

The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as incurred.

## Intangible assets

Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value at the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible assets are subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss arising from the derecognition of intangible assets are measured as the difference between net disposal proceeds and the carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed annually. Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation method or period.

## Intellectual property and software development

Significant costs associated with software are deferred and amortised on a straight-line basis over the period of their expected benefit, being their finite life of 4 years.

## Impairment of non-financial assets

Goodwill and other intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount.

Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or



cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a cash-generating unit.

## Trade and other payables

These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition.

## Borrowings

Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method.

The component of the convertible notes that exhibits characteristics of a liability is recognised as a liability in the statement of financial position, net of transaction costs.

On the issue of the convertible notes the fair value of the liability component is determined using a market rate for an equivalent non-convertible bond and this amount is carried as a non-current liability on the amortised cost basis until extinguished on conversion or redemption. The increase in the liability due to the passage of time is recognised as a finance cost. The remainder of the proceeds are allocated to the conversion option that is recognised and included in shareholders' equity as a convertible note reserve, net of transaction costs. The carrying amount of the conversion option is not remeasured in the subsequent years. The corresponding interest on convertible notes is expensed to profit or loss.

## Lease liabilities

A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group's incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred.

Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is made to the corresponding right-of-use asset, or to profit or loss if the carrying amount of the right-of-use asset is fully written down.

## Provisions

Provisions are recognised when the Group has a present (legal or constructive) obligation as a result of a past event, it is probable the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. If the time value of money is material, provisions are discounted using a current pre-tax rate specific to the liability. The increase in the provision resulting from the passage of time is recognised as a finance cost.

## Employee benefits

## Short-term employee benefits

Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities are settled.

## Defined contribution superannuation expense

Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred.

## Fair value measurement

When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair value is based on 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; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market.



Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. Classifications are reviewed at each reporting date and transfers between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value measurement.

For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where applicable, with external sources of data.

## 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.

## Loss per share

## Basic loss per share

Basic loss per share is calculated by dividing the loss attributable to the owners of Singular Health Group Ltd, 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 financial year.

## Diluted loss per share

Diluted earnings per share adjusts the figures used in the determination of basic loss 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.

## Goods and Services Tax ('GST') and other similar taxes

Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of the expense.

Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of financial position.

Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the tax authority, are presented as operating cash flows.

Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority.

## New Accounting Standards and Interpretations not yet mandatory or early adopted

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the Group for the annual reporting period ended 30 June 2021. The Group has not yet assessed the impact of these new or amended Accounting Standards and Interpretations.



## NOTE 2: SEGMENT REPORTING

Segment information has been prepared in conformity with the accounting policies adopted for preparing and presenting the financial statements of the consolidated Group. The Group’s primary business segment is the provision of Volume Rendering Platform (VRP) software. The Group operates in one segment, medical technology products.

An operating segment is a component of an entity that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the same entity), whose operating results are regularly reviewed by the entity’s chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance and for which discrete financial information is available. This includes start-up operations which are yet to earn revenues.

Management will also consider other factors in determining operating segments such as the existence of a line manager and the level of segment information presented to the board of directors.

Operating segments have been identified based on the information provided to the chief operating decision makers – being the executive management team.

The Group aggregates two or more operating segments when they have similar economic characteristics, and the segments are similar in the nature of the minerals targeted. Operating segments that meet the quantitative criteria as prescribed by AASB 8 are reported separately. However, an operating segment that does not meet the quantitative criteria is still reported separately where information about the segment would be useful to users of the financial statements.

Information about other business activities and operating segments that are below the quantitative criteria are combined and disclosed in a separate category for “all other segments”.

The chief operating decision maker has been identified as the Board of Directors.

## NOTE 3. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, 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 judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below.

## Coronavirus (COVID-19) pandemic

Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has had, or may have, on the Group based on known information. This consideration extends to the nature of the products and services offered, customers, supply chain, staffing and geographic regions in which the Group operates. Other than as addressed in specific notes, there does not currently appear to be either any significant impact upon the financial statements or any significant uncertainties with respect to events or conditions which may impact the Group unfavourably as at the reporting date or subsequently as a result of the Coronavirus (COVID-19) pandemic.

## Estimation of useful lives of assets

The Group determines the estimated useful lives and related depreciation and amortisation charges for its property, plant and equipment and finite life intangible assets. The useful lives could change significantly as a result of technical innovations or some other event. The depreciation and amortisation 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.

## Income tax

The Group is subject to income taxes in the jurisdictions in which it operates. Significant judgement is required in determining the provision for income tax. There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Group recognises 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.

## Employee benefits provision

As discussed in note 1, the liability for employee benefits expected to be settled more than 12 months from the reporting date are recognised and measured at the present value of the estimated future cash flows to be made in respect of all employees at the reporting date. In determining the present value of the liability, estimates of attrition rates and pay increases through promotion and inflation have been taken into account.

## Convertible notes

The convertible notes are valued and recorded in the accounts having regard to the conversion feature attributable to the notes including the discount on conversion to the ASX listing price. The implicit cost of the conversion discount described as “prepaid interest on Convertible notes” is amortised to profit or loss over the estimated period it will take the Group to complete its IPO and list on the ASX.

## Share Based Payments

The Group measures the cost of equity-settled transactions by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined using the Black-Scholes model taking into account the assumptions detailed within note 19. Inputs to pricing models may require an estimation of reasonable expectations about achievement of future vesting conditions. Vesting conditions must be satisfied for the counterparty to become entitled to receive cash, other assets or equity instruments of the entity, under a share-based payment arrangement. Vesting conditions include service conditions, which require the other party to complete a specified period of service, and performance conditions, which require specified performance targets to be met (such as a specified increase in the entity's profit or revenues over a specified period of time) or completion of performance hurdles.

The Group recognises an amount for the goods or services received during the vesting period based on the best available estimate of the number of equity instruments expected to vest and shall revise that estimate, if necessary, if subsequent information indicates that the number of equity instruments expected to vest differs from previous estimates.

## NOTE 4. REVENUE AND OTHER INCOME

<table><tr><td></td><td>2021 \(</td><td>2020 \)</td></tr><tr><td>Revenue</td><td></td><td></td></tr><tr><td>Product sales</td><td>193,643</td><td>105,922</td></tr><tr><td>Total Revenue</td><td>193,643</td><td>105,922</td></tr><tr><td>Research and Development grant income</td><td></td><td></td></tr><tr><td>Research and Development Grant</td><td>262,700</td><td>-</td></tr><tr><td>Total Research and Development grant income</td><td>262,700</td><td>-</td></tr><tr><td>Interest and other revenue</td><td></td><td></td></tr><tr><td>Interest Revenue</td><td>2,244</td><td>66</td></tr><tr><td>ATO Jobkeeper and cashflow boost</td><td>113,032</td><td>24,000</td></tr><tr><td>Other</td><td>2,078</td><td>-</td></tr><tr><td>Total Interest and other revenue</td><td>117,354</td><td>24,066</td></tr></table>

Disaggregation of revenue from contracts with customers

Revenue is recognised when or as the Group transfer control of the goods or services to a customer at the amount which the Group expects to be entitled over time and at a point in time. If the consideration promised includes a variable amount, the Group estimates the amount of consideration to which it will be entitled.



Timing of revenue recognition - 30 June 2021

At a point in time
Over time
Total

Geographical Regions - 30 June 2021

Australia
Rest of the World
Total

Timing of revenue recognition - 30 June 2020

At a point in time
Over time
Total

Geographical Regions - 30 June 2020

Australia
Rest of the World
Total

<table><tr><td>Product revenue</td><td>Stripe revenue</td></tr><tr><td>191,841</td><td>1,802</td></tr><tr><td>-</td><td>-</td></tr><tr><td>191,841</td><td>1,802</td></tr></table>

<table><tr><td>Product revenue</td><td>Stripe revenue</td></tr><tr><td>191,841</td><td>1,802</td></tr><tr><td>-</td><td>-</td></tr><tr><td>191,841</td><td>1,802</td></tr></table>

<table><tr><td>Product revenue</td><td>Stripe revenue</td></tr><tr><td>105,922</td><td>-</td></tr><tr><td>-</td><td>-</td></tr><tr><td>105,922</td><td>-</td></tr></table>

<table><tr><td>Product revenue</td><td>Stripe revenue</td></tr><tr><td>105,922</td><td>-</td></tr><tr><td>-</td><td>-</td></tr><tr><td>105,922</td><td>-</td></tr></table>



<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td>NOTE 5. EXPENSE ITEMS</td><td></td><td></td></tr><tr><td>Finance costs</td><td>$</td><td>$</td></tr><tr><td>Interest expense</td><td>19,179</td><td>275</td></tr><tr><td>One-Off Finance expense</td><td></td><td></td></tr><tr><td>Convertible note - interest expense</td><td>71,674</td><td>54,610</td></tr><tr><td>Convertible note - fair value adjustment (non-cash)</td><td>1,371,750</td><td>-</td></tr><tr><td>Other</td><td>1,779</td><td>538</td></tr><tr><td>Total Finance costs</td><td>1,464,382</td><td>55,423</td></tr></table>

## NOTE 6. INCOME TAX EXPENSE

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>a. The components of tax expense comprise:</td><td></td><td></td></tr><tr><td>Current tax</td><td>-</td><td>-</td></tr><tr><td>Deferred tax</td><td>-</td><td>-</td></tr><tr><td>Income tax reported in statement of comprehensive income</td><td>-</td><td>-</td></tr><tr><td>b. The prima facie tax expense/(benefit) on profit/(loss) from ordinary activities before income tax is reconciled to the income tax as follows:</td><td></td><td></td></tr><tr><td>Prima facie tax expense/(benefit) on profit/(loss) from ordinary activities before income tax at 30% (2020: 27.5%)¹</td><td>(1,336,829)</td><td>(194,587)</td></tr><tr><td>Add tax effect of:</td><td></td><td></td></tr><tr><td>- Non-allowable items</td><td>716,134</td><td>170,892</td></tr><tr><td>- Revenue losses and other deferred tax balances not recognised</td><td>694,067</td><td>31,972</td></tr><tr><td></td><td>73,372</td><td>8,278</td></tr><tr><td>Less tax effect of:</td><td></td><td></td></tr><tr><td>- R&amp;D tax incentive</td><td>58,024</td><td>8,278</td></tr><tr><td>- Other non-assessable income</td><td>15,348</td><td>-</td></tr><tr><td>Income tax reported in statement of comprehensive income</td><td>-</td><td>-</td></tr><tr><td>c. Unrecognised deferred tax assets at 30% (2020: 27.5%)¹</td><td></td><td></td></tr><tr><td>Revenue losses</td><td>721,425</td><td>37,842</td></tr><tr><td>Capital raising costs</td><td>209,547</td><td>4,459</td></tr><tr><td>Property, plant &amp; equipment</td><td>6,918</td><td>-</td></tr><tr><td>Provisions and accruals</td><td>24,655</td><td>10,138</td></tr><tr><td>Other</td><td>4,691</td><td>891</td></tr><tr><td></td><td>967,236</td><td>53,330</td></tr></table>

1 The corporate tax rate for eligible companies will reduce from 30% to 25% by 30 June 2022 providing certain turnover thresholds and other criteria are met. Deferred tax assets and liabilities are required to be measured at the tax rate that is expected to apply in the future income year when the asset is realised or the liability is settled. The Directors have determined that the deferred tax balances be measured at the tax rates stated. For the 2021 financial year the Group has base rate passive income more than 80% and as such is not considered a base rate entity, hence a 30% tax rate is applied.



Singular Health Group Ltd
Notes to the consolidated financial statements
30 June 2021

NOTE 7. CASH AND CASH EQUIVALENTS

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Cash at bank</td><td>4,135,691</td><td>130,552</td></tr><tr><td></td><td>4,135,691</td><td>130,552</td></tr></table>

NOTE 8. TRADE AND OTHER RECEIVABLES

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Trade receivables</td><td>88,300</td><td>95,391</td></tr><tr><td>Less: Allowance for expected credit losses</td><td>-</td><td>(25,000)</td></tr><tr><td>Total Trade receivables</td><td>88,300</td><td>70,391</td></tr><tr><td>GST receivable</td><td>56,092</td><td>-</td></tr><tr><td>R&amp;D Grant receivable</td><td>-</td><td>-</td></tr><tr><td>Bonds and deposits</td><td>4,531</td><td>-</td></tr><tr><td>Other receivables</td><td>3,196</td><td>-</td></tr><tr><td>Total Current trade and other receivables</td><td>152,119</td><td>70,391</td></tr></table>

Allowance for expected credit losses

The Group has recognised a loss of $nil in profit or loss in respect of the expected credit losses for the year ended 30 June 2021.



## NOTE 9. INTANGIBLES

<table><tr><td></td><td>2021\(</td><td>2020\)</td></tr><tr><td>Intellectual Property at cost</td><td>737,790</td><td>227,708</td></tr><tr><td>Less: Accumulated depreciation</td><td>(99,897)</td><td>(28,463)</td></tr><tr><td></td><td>637,893</td><td>199,245</td></tr><tr><td>a) Reconciliation of movements in intangible assets</td><td>$</td><td></td></tr><tr><td>Intangible Assets</td><td></td><td></td></tr><tr><td>Balance at 1 July 2019</td><td></td><td></td></tr><tr><td>Additions</td><td>227,708</td><td></td></tr><tr><td>Impairment expense</td><td>-</td><td></td></tr><tr><td>Amortisation expense</td><td>-</td><td></td></tr><tr><td>Balance at 30 June 2020</td><td>(28,463)</td><td></td></tr><tr><td></td><td>199,245</td><td></td></tr><tr><td>Balance at 1 July 2020</td><td>199,245</td><td></td></tr><tr><td>Additions</td><td>510,082</td><td></td></tr><tr><td>Impairment expense</td><td>-</td><td></td></tr><tr><td>Amortisation expense</td><td>(71,434)</td><td></td></tr><tr><td>Balance at 30 June 2021</td><td>637,893</td><td></td></tr></table>

## NOTE 10. PROPERTY, PLANT AND EQUIPMENT

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Office Equipment - at cost</td><td>41,482</td><td>31,623</td></tr><tr><td>Less: Accumulated depreciation</td><td>(15,679)</td><td>(3,932)</td></tr><tr><td>Computer Equipment - at cost</td><td>40,627</td><td>-</td></tr><tr><td>Less: Accumulated depreciation</td><td>(3,072)</td><td>-</td></tr><tr><td>Total property, plant and equipment</td><td>63,358</td><td>27,691</td></tr><tr><td>a) Reconciliation of movements in fixed assets</td><td>$</td><td></td></tr><tr><td>Property, Plant &amp; Equipment</td><td></td><td></td></tr><tr><td>Balance at 1 July 2019</td><td></td><td></td></tr><tr><td>Additions</td><td>31,623</td><td></td></tr><tr><td>Depreciation Expense</td><td>(3,932)</td><td></td></tr><tr><td>Balance at 30 June 2020</td><td>27,691</td><td></td></tr><tr><td>Balance at 1 July 2020</td><td>27,691</td><td></td></tr><tr><td>Additions</td><td>50,486</td><td></td></tr><tr><td>Depreciation expense</td><td>(14,819)</td><td></td></tr><tr><td>Balance at 30 June 2021</td><td>63,358</td><td></td></tr></table>



## NOTE 11. RIGHT OF USE ASSETS AND LEASE LIABILITIES

<table><tr><td>Right of Use Asset</td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Land and Building - right of use</td><td>177,703</td><td>-</td></tr><tr><td>Less: Accumulated Depreciation</td><td>(44,438)</td><td>-</td></tr><tr><td></td><td>133,265</td><td>-</td></tr><tr><td>Lease Liabilities</td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Current</td><td></td><td></td></tr><tr><td>Lease Liability</td><td>61,503</td><td>-</td></tr><tr><td>Total Current Lease Liability</td><td>61,503</td><td>-</td></tr><tr><td>Non-Current</td><td></td><td></td></tr><tr><td>Lease Liability</td><td>84,541</td><td>-</td></tr><tr><td>Total Non-Current Lease Liability</td><td>84,541</td><td>-</td></tr><tr><td>Total Lease Liabilities</td><td>146,044</td><td>-</td></tr></table>

Additions to the right-of-use assets during the year were $177,703 (refer note 28).

The Group leases land and buildings for its offices under agreements of between two to five years with, in some cases, options to extend. The leases have various escalation clauses. On renewal, the terms of the leases are renegotiated.

## NOTE 12. TRADE AND OTHER PAYABLES

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Current:</td><td></td><td></td></tr><tr><td>Trade Payables \( ^{(1)} \)</td><td>50,715</td><td>116,002</td></tr><tr><td>Accruals&amp; Other Payables</td><td>97,613</td><td>13,795</td></tr><tr><td></td><td>148,328</td><td>129,797</td></tr></table>

(1) Current trade payables are non-interest bearing and are normally settled on 30-day terms.

## NOTE 13. PROVISIONS

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Current:</td><td></td><td></td></tr><tr><td>Provision for annual leave</td><td>49,184</td><td>6,117</td></tr><tr><td>Total Provisions</td><td>49,184</td><td>6,117</td></tr></table>



## NOTE 14. BORROWINGS

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Current:</td><td></td><td></td></tr><tr><td>Director Loans \( ^{(1)} \)</td><td>1,545</td><td>155,941</td></tr><tr><td>External Loans</td><td>-</td><td>-</td></tr><tr><td>Total Borrowings</td><td>1,545</td><td>155,941</td></tr><tr><td colspan="3">Refer to note 20 for further information on financial instruments.</td></tr></table>

(1) Director Loans are unsecured, bear interest at 5% pa, with no fixed terms of repayment.

## NOTE 15. CONVERTIBLE NOTES

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Current</td><td></td><td></td></tr><tr><td>Balance brought forward</td><td>590,000</td><td>-</td></tr><tr><td>Convertible notes issued during the period</td><td>2,110,000</td><td>590,000</td></tr><tr><td>Less: Convertible Notes converted during the year</td><td>(2,700,000)</td><td>-</td></tr><tr><td>Closing Balance</td><td>-</td><td>590,000</td></tr></table>

As part of the IPO completed February 2021, all convertible loans on issue including interest accrued converted into fully paid ordinary shares. Refer to note 16.

The terms of the various convertible notes are as follows:

Conversion Period A period of 22 months commencing from the date of issue.

Conversion Event The day Singular Health Group Ltd’s shares are listed on the Australian Stock Exchange (“ASX”).

Conversion Price The Convertible notes are converted at a discount of 50% of the price the shares are listed on the ASX.

Interest
Interest accrued on the Convertible Notes at the rate of 10% pa. Interest expense of $71,674 was recognized in the profit or loss. Fair Value borrowing costs of $1,371,750 was amortised to profit or loss over the period from the date the notes were issued and the date of listing on the ASX.

## Non-recurring fair value measurements

The convertible notes are recognised as a financial liability at fair value through profit or loss. The fair value was determined on initial recognition and subsequently the liability is measured at fair value at each reporting period until settlement. The fair value movement was recognised in the profit or loss as finance costs.



## NOTE 16. EQUITY – ISSUED CAPITAL

<table><tr><td></td><td>2021Shares</td><td>2020Shares</td><td>2021\(</td><td>2020\)</td></tr><tr><td>Ordinary shares - no par value (fully paid)</td><td>102,798,867</td><td>55,000,001</td><td>9,526,669</td><td>500,000</td></tr><tr><td>Movements in ordinary share capital</td><td></td><td></td><td></td><td></td></tr><tr><td>Details</td><td>Date</td><td>Shares</td><td>Issue price</td><td>$</td></tr><tr><td>Opening Balance</td><td>1 September 2019</td><td>1</td><td></td><td>-</td></tr><tr><td>New shares issued upon company restructure</td><td>23 March 2020</td><td>55,000,000</td><td>$0.01</td><td>500,000</td></tr><tr><td>Closing Balance</td><td>30 June 2020</td><td>55,000,001</td><td></td><td>500,000</td></tr><tr><td>IPO Placement shares</td><td>02 February 2021</td><td>30,000,000</td><td>$0.20</td><td>6,000,000</td></tr><tr><td>Shares issued upon conversion of Existing Convertible Notes</td><td>02 February 2021</td><td>14,230,384</td><td>$0.20</td><td>2,846,077</td></tr><tr><td>Shares issued to Lead Manager and Advisor</td><td>02 February 2021</td><td>3,000,000</td><td>$0.20</td><td>600,000</td></tr><tr><td>Shares issued for VR Surgical Acquisition</td><td>27 May 2021</td><td>568,482</td><td>$0.44</td><td>250,000</td></tr><tr><td>Cost of shares issued</td><td></td><td></td><td></td><td>(669,408)</td></tr><tr><td>Closing Balance</td><td>30 June 2021</td><td>102,798,867</td><td></td><td>9,526,669</td></tr></table>

## Ordinary shares

Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Group in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Group does not have a limited amount of authorised capital.

On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

## Capital risk management

The Group’s objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital.

## NOTE 17. EQUITY - RESERVES

<table><tr><td></td><td>2021\(</td><td>2020\)</td></tr><tr><td>Share-based payment reserve</td><td></td><td></td></tr><tr><td>Performance Rights</td><td>270,818</td><td>-</td></tr><tr><td>Options</td><td>449,416</td><td>-</td></tr><tr><td>Total Share Based Payment Reserve</td><td>720,234</td><td>-</td></tr><tr><td>Foreign Currency Translation Reserve</td><td>(948)</td><td>5,998</td></tr><tr><td>Total Reserves</td><td>719,286</td><td>5,998</td></tr></table>



## Nature and Purpose of Share-Based Payment Reserve

The share-based payment reserve records the value of options, performance rights and performance shares issued to the Group’s directors, employees, and third parties. The value of the amount disclosed during the year reflects the value of options and performance shares issued by the Group.

## Nature and Purpose of Foreign currency reserve

The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign operations to Australian dollars. It is also used to recognise gains and losses on hedges of the net investments in foreign operations.

## Movements in reserves

Movements in each class of reserve during the current and previous financial year are included in the Statement of Changes in Equity.

## Options Outstanding at 30 June 2021

The following options over ordinary shares of the Group existed at reporting date:

<table><tr><td>Grant Date</td><td>Expiry Date</td><td>Exercise Price</td><td>Balance at start of Year (number)</td><td>Granted During the Year (number)</td><td>Exercised during the year (number)</td><td>Forfeited during the year (number)</td><td>Balance at year end (number)</td><td>Vested and exercisable at year end (number)</td></tr><tr><td>12/02/2021</td><td>12/02/2025</td><td>$0.30</td><td>-</td><td>19,250,000</td><td>-</td><td>-</td><td>19,250,000</td><td>-</td></tr><tr><td colspan="3">Total</td><td>-</td><td>19,250,000</td><td>-</td><td>-</td><td>19,250,000</td><td>-</td></tr></table>

Reconciliation of movement in option reserve:

<table><tr><td>Details</td><td>Date</td><td>Number of Options</td><td>Value $</td></tr><tr><td>Opening Balance</td><td>1 July 2020</td><td>-</td><td>-</td></tr><tr><td>Options issued to directors and key management personnel on IPO \( ^{(1)} \)</td><td>12 February 2021</td><td>19,250,000</td><td>449,416</td></tr><tr><td>Exercised during the period</td><td>-</td><td>-</td><td>-</td></tr><tr><td>Lapsed/Forfeited during the period</td><td>-</td><td>-</td><td>-</td></tr><tr><td>Balance</td><td>30 June 2021</td><td>19,250,000</td><td>449,416</td></tr></table>

(1) On 12 February 2021, 19,250,000 options were issued to Directors and key management personnel in relation to services to be provided. These options expire on 12 February 2025 and exercise price of $0.30 per option vesting over 2 years (IPO options). Refer to share based payment note 19 for the fair value assessment of these options.

## Performances rights outstanding as at 30 June 2021

The following Performance Rights of the Group existed at reporting date

<table><tr><td>Grant Date</td><td>Expiry Date</td><td>Exercise Price</td><td>Balance at start of Year (number)</td><td>Granted During the Year (number) \( ^{1} \)</td><td>Exercised during the Year (number)</td><td>Forfeited during the Year (number)</td><td>Balance at Year end (number)</td><td>Vested and exercisable at Year end (number)</td></tr><tr><td>12/02/2021</td><td>31/12/2023</td><td>Nil</td><td>-</td><td>5,000,000</td><td>-</td><td>-</td><td>5,000,000</td><td>-</td></tr><tr><td>12/02/2021</td><td>31/12/2024</td><td>Nil</td><td>-</td><td>5,000,000</td><td>-</td><td>-</td><td>5,000,000</td><td>-</td></tr><tr><td>Total</td><td></td><td></td><td>-</td><td>10,000,000</td><td>-</td><td>-</td><td>10,000,000</td><td>-</td></tr></table>

(1) The following performance rights were granted during the year under the Group’s Performance Rights Plan and issued on IPO on 12 February 2021:

a. 5,000,000 Class A Performance Rights were issued to Directors and key management personnel as security-based remuneration.

b. 5,000,000 Class B Performance Rights were issued to Directors and key management personnel as security-based remuneration.

Refer to note 19 for further breakdown and fair values of Rights issued.



Reconciliation of movement in performance right reserve:

<table><tr><td></td><td>Number of Performance Rights</td><td>Value $</td></tr><tr><td>Opening Balance - 1 July 2020</td><td>-</td><td>-</td></tr><tr><td>Performance Rights granted during the year</td><td>10,000,000</td><td>270,818</td></tr><tr><td>Performance Rights expense recognised for the current period</td><td>-</td><td>-</td></tr><tr><td>Performance rights exercised during the period</td><td>-</td><td>-</td></tr><tr><td>Reversal of share based payment expense as vesting conditions are not met</td><td>-</td><td>-</td></tr><tr><td>Closing Balance - 30 June 2021</td><td>10,000,000</td><td>270,818</td></tr></table>

<table><tr><td>Performance Rights</td><td>Valuation Date</td><td>Vesting Date (Expected)</td><td>Fair Value at Grant Date</td><td>Balance as at 30 June 2021 (Number)</td><td>Total Expense for the year</td></tr><tr><td>Class A Performance Rights</td><td>12/02/2021</td><td>30/06/2023</td><td>$0.20</td><td>5,000,000</td><td>$158,986</td></tr><tr><td>Class B Performance Rights</td><td>12/02/2021</td><td>30/06/2024</td><td>$0.20</td><td>5,000,000</td><td>$111,831</td></tr><tr><td>Total</td><td></td><td></td><td></td><td>10,000,000</td><td>$270,818</td></tr></table>

## NOTE 18. EQUITY – ACCUMULATED LOSSES

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Accumulated losses at the beginning of the financial year</td><td>(707,588)</td><td>-</td></tr><tr><td>Loss after income tax expense for the year</td><td>(4,456,097)</td><td>(707,588)</td></tr><tr><td>Accumulated losses at the end of the financial year</td><td>(5,163,685)</td><td>(707,588)</td></tr></table>

## NOTE 19. SHARE BASED PAYMENTS

Share-based payments made during the year ended 30 June 2021 are summarised below:

## (a) Recognised Share-Based Payment Expense

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Options issued to Directors as incentive based remuneration \( ^{(b)} \)</td><td>361,868</td><td>-</td></tr><tr><td>Options issued to other key management personnel and consultants as incentive based remuneration \( ^{(b)} \)</td><td>87,548</td><td>-</td></tr><tr><td>Performance Rights issued to Directors as incentive and for services \( ^{(c)} \)</td><td>154,366</td><td>-</td></tr><tr><td>Performance Rights issued to key management personnel and consultants as incentive and for services</td><td>116,452</td><td>-</td></tr><tr><td>Reversal of Share Based Payment expenses as vesting conditions not met</td><td></td><td></td></tr><tr><td></td><td>720,234</td><td>-</td></tr></table>

## (b) Options granted to Directors, key management personnel and consultants for services

The Group’s ESOP is designed to provide medium and long term incentives for all employees (including Directors and consultants) and to attract and retain experienced employees, board members and executive officers and provide motivation to make the Group more successful.



Under the ESOP, participants have been granted options which only vest if certain performance milestones are met. Participation in the plan is at the Board's discretion and no individual has a contractual right to participate in the plan or to receive any guaranteed benefit.

Any option may only be exercised after the option has vested and other conditions imposed by the Board have been satisfied. Options are granted under the plan for no consideration. Options granted under the plan carry no dividend or voting rights. When exercisable, shares allotted pursuant to the exercise of options will be allotted following receipt of relevant documentation and payments will rank equally with all other shares.

(i) During the year 15,500,000 options were granted and issued on IPO to Singular Health's directors, expiring 4 years from the date the Company is admitted to the Official List of ASX (i.e. 12 February 2025). These options vest 2 years from the date the Company is admitted to the Official List of ASX, subject to the Option holder remaining a Director of the Company for the entirety of that 2-year period, the details of which have been outlined below.

<table><tr><td>Director</td><td>Number</td><td>Value Per Option</td><td>Total Value</td><td>Total Share-Based Payment Expense for the year ($)</td></tr><tr><td>Thomas Hanly</td><td>6,000,000</td><td>0.123</td><td>740,991</td><td>140,078</td></tr><tr><td>Howard Digby</td><td>1,000,000</td><td>0.123</td><td>123,498</td><td>23,347</td></tr><tr><td>Denning Chong</td><td>4,500,000</td><td>0.123</td><td>555,743</td><td>105,058</td></tr><tr><td>Prof. Kwang Guan Tay PhD</td><td>3,000,000</td><td>0.123</td><td>370,496</td><td>70,039</td></tr><tr><td>Andrew Just</td><td>1,000,000</td><td>0.123</td><td>123,499</td><td>23,346</td></tr><tr><td>Total</td><td>15,500,000</td><td></td><td>1,914,227</td><td>361,868</td></tr></table>

(ii) Similarly, 3,750,000 options were granted and issued on IPO to key management personnel and consultant, expiring 4 years from the date the Company is admitted to the Official List of ASX (i.e. 12 February 2025). These options have the same vesting conditions as the above, being 2 years from Official admission to ASX and the holder remaining employed for the entirety of the 2-year period.

<table><tr><td>KMP/Consultant</td><td>Number</td><td>Value Per Option</td><td>Total Value</td><td>Total Share-Based Payment Expense for the year ($)</td></tr><tr><td>James Hill</td><td>2,250,000</td><td>0.123</td><td>277,871</td><td>52,529</td></tr><tr><td>Steven Wood</td><td>1,500,000</td><td>0.123</td><td>185,248</td><td>35,019</td></tr><tr><td>Total</td><td>3,750,000</td><td></td><td>463,119</td><td>87,548</td></tr></table>

The fair value of these options has been determined using a Black Scholes model and the inputs are outlined below:

<table><tr><td></td><td>IPO Options</td></tr><tr><td>Grant Date</td><td>12-Feb-21</td></tr><tr><td>No of Options at 30 June 2021</td><td>19,250,000</td></tr><tr><td>Underlying share price</td><td>$0.20</td></tr><tr><td>Exercise price</td><td>$0.30</td></tr><tr><td>Expected volatility</td><td>100%</td></tr><tr><td>Expiry date (years)</td><td>2</td></tr><tr><td>Expected dividends</td><td>Nil</td></tr><tr><td>Risk free rate</td><td>0.26%</td></tr><tr><td>Value per option (rounded)</td><td>$0.12</td></tr></table>



## (c) Performance Rights

During the year 5,000,000 Class A and 5,000,000 Class B Performance Rights were granted and issued on IPO to Directors, key management personnel and consultants under the Company’s Performance Rights Plan which vests upon meeting various performance milestones per the table below.
The Performance Rights granted convert into ordinary shares on a one for one basis.

<table><tr><td rowspan="2">Director</td><td>Class A Performance Rights</td><td>Class B Performance Rights</td></tr><tr><td>1,500,000</td><td>1,500,000</td></tr><tr><td>Thomas Hanly</td><td>1,200,000</td><td>1,200,000</td></tr><tr><td>Denning Chong</td><td>150,000</td><td>150,000</td></tr><tr><td>Guan Tay</td><td>800,000</td><td>800,000</td></tr><tr><td>Other KMPs</td><td>1,350,000</td><td>1,350,000</td></tr><tr><td>Consultants</td><td>5,000,000</td><td>5,000,000</td></tr><tr><td>Total</td><td>5,000,000</td><td>5,000,000</td></tr></table>

<table><tr><td>Class of Performance Rights</td><td>Number of Performance Rights</td><td>Performance Milestones</td><td>Expected Milestone achievement date</td><td>Expense recognised during the year - Directors ()</td><td>Expense recognised during the year - KMPs/consultant ()</td></tr><tr><td>Class A Performance Rights</td><td>5,000,000</td><td>The Shares are admitted to the Official List of ASX; AND The company achieves a Gross Revenue of at least $1.25m for the 2022-2023 financial year.</td><td>30/06/2023</td><td>90,622</td><td>68,364</td></tr><tr><td>Class B Performance Rights</td><td>5,000,000</td><td>The Shares are admitted to the Official List of ASX; AND The company achieves a Gross Revenue of at least $2.5m for the 2023-2024 financial year.</td><td>30/06/2024</td><td>63,744</td><td>48,088</td></tr><tr><td>TOTAL</td><td>10,000,000</td><td></td><td></td><td>154,366</td><td>116,452</td></tr></table>

Management have assessed the probability of achieving the vesting condition, as at reporting date. If it was assessed that the hurdle was likely to be met prior to the expiry date the share based payment expense has been adjusted to reflect a shorter vesting period.

The total share based payment expense for the period in respect to the Performance Rights granted and on issue was $270,818.

## NOTE 20. FINANCIAL INSTRUMENTS

## Financial risk management objectives

The Group’s principal financial instruments comprise cash, receivables, and payables.
Primary responsibility for identification and control of financial risks rests with the Board. The Board reviews and agrees policies for managing each of the risks identified.



The Group manages its exposure to key financial risks, including interest rate, credit and liquidity risks in accordance with the Group’s risk management policy. The primary objective of the policy is to reduce the volatility of cash flows and asset values arising from such movements.

The Group uses different methods to measure and manage the different types of risks to which it is exposed. These include monitoring the levels of exposure to interest rate risk, ageing analysis and monitoring of credit allowances to manage credit risk and the use of future cash flow forecasts to monitor liquidity risk.

## Significant accounting policies

Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised, with respect to each class of financial asset, financial liability and equity instrument are disclosed in note 1 to the financial statements.

## Categorisation of Financial Instruments

Details of each category in accordance with Australian Accounting Standard AASB 9 Financial Instruments, are disclosed either on the face of the Statement of Financial Position or in the notes.

## Credit risk

(i) Exposure to Credit Risk

The carrying amount of the Group’s financial assets represents the maximum credit exposure. The Group’s maximum exposure to credit risk at the reporting date was:

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td>Financial Asset</td><td>$</td><td>$</td></tr><tr><td>Cash and cash equivalents</td><td>4,135,691</td><td>130,552</td></tr><tr><td>Trade and other receivables</td><td>152,119</td><td>70,391</td></tr><tr><td>Total</td><td>4,287,810</td><td>200,943</td></tr></table>



Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual payments for a period greater than 1 year. Financial assets as at 30 June 2021 are neither past due nor impaired.

## (ii) Interest Rate Risk

The Group’s maximum exposure to interest rates at the reporting date was:

<table><tr><td rowspan="2"></td><td rowspan="2">Range of Effective Interest Rate (%)</td><td colspan="5">Interest Rate Exposure</td></tr><tr><td>Carrying Amount</td><td>Variable Interest Rate</td><td>Non Interest Bearing</td><td>Fixed Interest Rate</td><td>Total</td></tr><tr><td>2021</td><td>(%)</td><td>$</td><td>$</td><td>$</td><td>$</td><td>$</td></tr><tr><td>Financial Assets</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash and cash equivalents</td><td>0 - 1</td><td>4,135,691</td><td>1,135,691</td><td>-</td><td>3,000,000</td><td>4,135,691</td></tr><tr><td>Financial Liabilities</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Borrowings</td><td>5</td><td>1,545</td><td>-</td><td>-</td><td>1,545</td><td>1,545</td></tr><tr><td>2020</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Financial Assets</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash and cash equivalents</td><td>0 - 1</td><td>130,552</td><td>130,552</td><td>-</td><td>-</td><td>130,552</td></tr><tr><td>Financial Liabilities - Current</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Borrowings</td><td>5</td><td>155,941</td><td>-</td><td>-</td><td>155,941</td><td>155,941</td></tr><tr><td>Convertible Notes</td><td>10</td><td>590,000</td><td>-</td><td>-</td><td>590,000</td><td>590,000</td></tr></table>



## Liquidity risk

(i) Exposure to Liquidity Risk
The carrying amount of the Group’s financial liabilities represents the maximum liquidity risk. The Group’s maximum exposure to liquidity risk at the reporting date was:

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Financial Liabilities</td><td></td><td></td></tr><tr><td>Trade and other payables</td><td>148,328</td><td>129,797</td></tr><tr><td>Borrowings</td><td>1,545</td><td>155,941</td></tr><tr><td>Lease liabilities</td><td>146,044</td><td>-</td></tr><tr><td>Convertible notes</td><td>-</td><td>590,000</td></tr><tr><td>Total financial liabilities</td><td>295,917</td><td>875,738</td></tr></table>

(ii) Contract Maturity Risk

<table><tr><td>2021</td><td>0-6 months</td><td>6-12 months</td><td>Over 1 to 5 years</td><td>More than 5 years</td><td>Total</td></tr><tr><td>Financial Instrument</td><td>$</td><td>$</td><td>$</td><td>$</td><td>$</td></tr><tr><td>Financial Assets</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash</td><td>4,135,691</td><td>-</td><td>-</td><td>-</td><td>4,135,691</td></tr><tr><td>Trade and other receivables</td><td>152,119</td><td>-</td><td>-</td><td>-</td><td>152,119</td></tr><tr><td>Total financial assets</td><td>4,287,810</td><td>-</td><td>-</td><td>-</td><td>4,287,810</td></tr><tr><td>Financial Liabilities</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Trade and other payables</td><td>148,328</td><td>-</td><td>-</td><td>-</td><td>148,328</td></tr><tr><td>Borrowings</td><td>1,545</td><td>-</td><td>-</td><td>-</td><td>1,545</td></tr><tr><td>Lease liabilities</td><td>30,751</td><td>30,751</td><td>85,542</td><td>-</td><td>146,044</td></tr><tr><td>Total financial liabilities</td><td>180,624</td><td>30,751</td><td>84,542</td><td>-</td><td>295,917</td></tr><tr><td>2020</td><td>0-6 months</td><td>6-12 months</td><td>Over 1 to 5 years</td><td>More than 5 years</td><td>Total</td></tr><tr><td>Financial Instrument</td><td>$</td><td>$</td><td>$</td><td>$</td><td>$</td></tr><tr><td>Financial Assets</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash</td><td>130,552</td><td>-</td><td>-</td><td>-</td><td>130,552</td></tr><tr><td>Trade and other receivables</td><td>70,391</td><td>-</td><td>-</td><td>-</td><td>70,391</td></tr><tr><td>Total financial assets</td><td>200,943</td><td>-</td><td>-</td><td>-</td><td>200,943</td></tr><tr><td>Financial Liabilities</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Trade and other payables</td><td>129,797</td><td>-</td><td>-</td><td>-</td><td>129,797</td></tr><tr><td>Borrowings</td><td>-</td><td>155,941</td><td>-</td><td>-</td><td>155,941</td></tr><tr><td>Convertible notes</td><td>-</td><td>590,000</td><td>-</td><td>-</td><td>590,000</td></tr><tr><td>Total financial liabilities</td><td>129,797</td><td>745,941</td><td>-</td><td>-</td><td>875,738</td></tr></table>



The Group manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.

## Fair value of financial instruments

Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.

## Market Risk

## (i) Currency Risk

The Group is not exposed to any significant foreign currency risk.
The Group currently does not engage in any hedging or derivative transactions to maintain foreign currency risk.

## (ii) Interest Rate Risk

The Group’s only exposure to interest rate risk is on balances held as cash and the directors loan payable as set out in note 20(d)(ii)

## (iii) Other Price Risk

By virtue of the nature and classification of the financial instruments held by the Group, it is not exposed to significant other price risk.

## (iv) Sensitivity Disclosure Analysis

Taking into account past performance, future expectations and economic forecasts, the Group believes the following movements are ‘reasonably possible’ over the next 12 months (base rates are sourced from the Reserve Bank of Australia). It is considered that 100 basis points is a ‘reasonably possible’ estimate of potential variations in the interest rate. The following table discloses the impact on net operating result and equity for each category of financial instrument held by the Group at year end as presented to key management personnel, if changes in the relevant risk occur.

<table><tr><td rowspan="2"></td><td rowspan="2">Carrying Amount</td><td colspan="4">Interest Rate Risk</td></tr><tr><td>+1%</td><td>Equity</td><td>-1%</td><td>Equity</td></tr><tr><td>2021</td><td>$</td><td>Profit</td><td>$</td><td>Profit</td><td>$</td></tr><tr><td>Financial Assets</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash and cash equivalents</td><td>4,135,961</td><td>41,357</td><td>41,357</td><td>(41,357)</td><td>(41,357)</td></tr><tr><td>Trade Receivables</td><td>152,119</td><td>-</td><td>-</td><td>-</td><td>-</td></tr><tr><td>Financial Liabilities</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Trade and other payable</td><td>148,328</td><td>-</td><td>-</td><td>-</td><td>-</td></tr><tr><td>Borrowings</td><td>1,545</td><td>15</td><td>15</td><td>(15)</td><td>(15)</td></tr><tr><td>2020</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Financial Assets</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash and cash equivalents</td><td>130,552</td><td>1,305</td><td>1,305</td><td>(1,305)</td><td>(1,305)</td></tr><tr><td>Trade Receivables</td><td>70,391</td><td>-</td><td>-</td><td>-</td><td>-</td></tr><tr><td>Financial Liabilities</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Trade and other payable</td><td>129,797</td><td>-</td><td>-</td><td>-</td><td>-</td></tr><tr><td>Borrowings</td><td>155,941</td><td>(1,559)</td><td>(1,559)</td><td>1,559</td><td>1,559</td></tr><tr><td>Convertible Note</td><td>590,000</td><td>(5,900)</td><td>(5,900)</td><td>5,900</td><td>5,900</td></tr></table>



## NOTE 21. REMUNERATION OF AUDITORS

During the financial year the following fees were paid or payable for services provided by Moore Australia Audit (WA), the auditor of the Group, its network firms and unrelated firms:

<table><tr><td></td><td>2021 \(</td><td>2020 \)</td></tr><tr><td>Assurance services - Moore Australia Audit (WA)</td><td></td><td></td></tr><tr><td>Audit or review of the financial statements</td><td>38,000</td><td>15,000</td></tr><tr><td>Other assurance engagements</td><td>20,000</td><td>-</td></tr><tr><td>Other services - Moore Australia (WA)</td><td></td><td></td></tr><tr><td>Preparation of the tax return</td><td>8,000</td><td>5,000</td></tr><tr><td>Consulting Services</td><td>7,450</td><td></td></tr><tr><td></td><td>73,450</td><td>20,000</td></tr></table>

## NOTE 22. CONTINGENT LIABILITIES AND CONTINGENT ASSETS

There are no contingent liabilities or contingent assets at 30 June 2021 (2020: Nil).

## NOTE 23. COMMITMENTS

Capital commitments

There were no significant capital commitments as at 30 June 2021 (2020: Nil).



## NOTE 24. RELATED PARTY TRANSACTIONS
(a) Parent and Subsidiaries

The parent entity and ultimate parent entity of the Group is Singular Health Group Limited, a company listed on the Australian Securities Exchange. The components of the Group are:

<table><tr><td></td><td>Incorporation</td><td>Extent of control 2021</td><td>2020</td></tr><tr><td>Parent</td><td></td><td></td><td></td></tr><tr><td>Singular Health Group Limited</td><td>Australia</td><td>-</td><td>-</td></tr><tr><td>Controlled entities</td><td></td><td></td><td></td></tr><tr><td>Singular Health Pte. Ltd</td><td>Singapore</td><td>100%</td><td>100%</td></tr><tr><td>Singular Health Pty Ltd</td><td>Australia</td><td>100%</td><td>100%</td></tr></table>

## Associates

Interests in associates are set out in note 26.

## (b) Key Management Personnel Compensation

Information on remuneration of all Directors and Key Management Personnel is contained in the Remuneration Report within the Directors' Report. The aggregated compensation paid to Directors and Key Management Personnel of the Group is as follows:

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Short-term employee benefits</td><td>750,931</td><td>250,912</td></tr><tr><td>Post-employment benefits</td><td>32,376</td><td>-</td></tr><tr><td>Share-based payment</td><td>847,113</td><td>-</td></tr><tr><td>Total</td><td>1,630,419</td><td>250,912</td></tr></table>

## (c) Other Transactions with Key Management Personnel

## Related Party Transactions

JDE Capital Pty Ltd, a company associated with Denning Chong, received $30,750 excluding GST (2020: $3,300) during the period for non-executive director services provided to the Company, with $nil payable as at 30 June 2021.

Research Equity Pty Ltd, a company associated with Thomas Hanly, received $200,418 excluding GST (2020: $174,996) in fees during the period for executive director services provided to the Company, with $nil payable as at 30 June 2021.

James Chong and Co Pty Ltd, a company associated with Denning Chong, received $8,423 excluding GST (2020: \)nil) in fees during the period for legal services provided to the Company, with $nil payable as at 30 June 2021.

Re-Energise Digital, a company associated with James Hill, received $57,680 excluding GST (2020: $10,549) in fees during the period for marketing services to the Company including typesetting and preparation of the Prospectus, with $4,158 payable at 30 June 2021.

Grange Consulting, a company associated with Steven Wood, received $103,491 excluding GST (2020: $19,163) in fees during the period for financial services, company secretarial work and corporate advisory services, with $nil payable at 30 June 2021.

## Loans to/from related parties

Directors loans payable at year end (refer to note 14) to Denning Sang-Tatt Chong were $1,545 (2020: $155,941).

## Terms and conditions

All transactions were made on normal commercial terms and conditions and at market rates.



## NOTE 25. PARENT ENTITY INFORMATION

Set out below is the supplementary information about the parent entity.

Statement of profit or loss and other comprehensive income

<table><tr><td rowspan="2"></td><td colspan="2">Parent</td></tr><tr><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Profit/(Loss) for the year</td><td>(4,884,217)</td><td>(651,176)</td></tr><tr><td>Total comprehensive income</td><td>(4,884,217)</td><td>(651,176)</td></tr></table>

Statement of financial position

<table><tr><td rowspan="2"></td><td colspan="2">Parent</td></tr><tr><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Total current assets</td><td>4,083,329</td><td>-</td></tr><tr><td>Total assets</td><td>5,136,428</td><td>214,086</td></tr><tr><td>Total current liabilities</td><td>(54,157)</td><td>(500)</td></tr><tr><td>Total liabilities</td><td>(54,157)</td><td>(500)</td></tr><tr><td>Equity</td><td></td><td></td></tr><tr><td>Issued capital</td><td>9,526,669</td><td>500,000</td></tr><tr><td>Reserves</td><td>720,234</td><td>(5,998)</td></tr><tr><td>Accumulated losses</td><td>(5,164,633)</td><td>(280,416)</td></tr><tr><td>Total equity</td><td>5,082,270</td><td>213,586</td></tr></table>

Guarantees entered into by the parent entity in relation to the debts of its subsidiaries

The parent entity has not entered into any guarantees in relation to the debts of its subsidiaries.

Contingent liabilities

The parent entity had no contingent liabilities as at 30 June 2021 and 30 June 2020.

Capital commitments - Property, plant and equipment

The parent entity had no capital commitments for property, plant and equipment as at 30 June 2021 and 30 June 2020.

Significant accounting policies

The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 1.



## NOTE 26. ASSET ACQUISITIONS AND INVESTMENTS IN ASSOCIATES

## a. VR Surgical software acquisition

On 26 May 2021, the Group acquired virtual surgical planning software developed by VR Surgical Pty Ltd (VR Surgical) which is a software that allows surgeons to manipulate standard computer aided design (CAD) files to accelerate the preoperative planning of maxillofacial surgery in virtual reality. The acquisition was approved by the shareholders at the General Meeting held on 11 May 2021.

In consideration for this acquisition, SHG paid $250,000 in cash and $250,000 worth of issued ordinary shares each to VR Surgical. The fair value of consideration issued on 27 May 2021 which was by reference to the 30-day VWAP of $0.43976 with the total number of shares issued being 568,482. Refer note 16.

The transaction is treated as an asset acquisition as the acquired assets being the software does not meet the definition of 'business' under IFRS 3. The software was recognised as an addition to the Group's Intangibles to be over amortised over 4 years. Refer note 9.

## b. Investment in Australian Additive Engineering Pty Ltd

On 21 March 2021, the Group and Australian Additive Engineering Pty Ltd (AAE) entered into share subscription deed where SHG will subscribe to 25% of AAE's share capital for a subscription price of $300,000. The acquisition was approved by the shareholders at the General Meeting held on 11 May 2021.

Consideration of $300,000 in cash was paid on 26 May 2021 and this is deemed to be the date of acquisition.

Under AASB 128 Investments in associates and joint ventures, SHG's 25% interest in AAE is considered a significant influence as it holds more than 20% directly in the investee and therefore, the investment is equity accounted.

Interests in associates are accounted for using the equity method of accounting. Information relating to associates that are material to the Group are set out below:

<table><tr><td>Name</td><td>Principle place of business/Country of incorporation</td><td colspan="2">Ownership interest</td></tr><tr><td>Australian Additive Engineering Pty Ltd</td><td>Australia</td><td>2021</td><td>2020</td></tr><tr><td></td><td></td><td>25%</td><td>0%</td></tr></table>



## Summarised financial information for associates

Summarised statement of financial position

The statement below provides summarised financial information for the associate that is material to the Group. The information disclosed reflects the amounts presented in the financial statements of the relevant associate and not Singular Health Group Ltd's share of those amounts. They have been amended to reflect adjustments made by the entity when using the equity method, including fair value adjustments and modifications for differences in accounting policy.

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Current assets</td><td>778,750</td><td>-</td></tr><tr><td>Non-current assets</td><td>79,461</td><td>-</td></tr><tr><td>Total assets</td><td>858,211</td><td>-</td></tr><tr><td>Current liabilities</td><td>(16,977)</td><td>-</td></tr><tr><td>Non-current liabilities</td><td>-</td><td>-</td></tr><tr><td>Total liabilities</td><td>(16,977)</td><td>-</td></tr><tr><td>Net assets</td><td>841,234</td><td>-</td></tr></table>

Summarised statement of profit or loss and other comprehensive income

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Revenue</td><td>-</td><td>-</td></tr><tr><td>Expenses</td><td>(16,543)</td><td>-</td></tr><tr><td>Profit/(Loss) before income tax</td><td>(16,543)</td><td>-</td></tr><tr><td>Income tax expense</td><td>-</td><td>-</td></tr><tr><td>Profit/(Loss) after income tax</td><td>(16,543)</td><td>-</td></tr><tr><td>Other comprehensive income</td><td></td><td></td></tr><tr><td>Total comprehensive loss</td><td>(16,543)</td><td>-</td></tr><tr><td>Reconciliation of the company&#x27;s carrying amount:</td><td></td><td></td></tr><tr><td>Opening carrying amount</td><td>-</td><td>-</td></tr><tr><td>Share of profit/(loss) after income tax</td><td>(4,136)</td><td>-</td></tr><tr><td>Closing carrying amount</td><td>(4,136)</td><td>-</td></tr></table>

Contingent liabilities

Australian Additive Engineering Pty Ltd had no contingent liabilities as at 30 June 2021 and 30 June 2020.

Capital commitments

Australian Additive Engineering Pty Ltd had no capital commitments as at 30 June 2021 and 30 June 2020.

Significant restrictions

Australian Additive Engineering Pty Ltd has no significant restrictions as at 30 June 202 and 30 June 2020.



## NOTE 27. RECONCILIATION OF PROFIT AFTER INCOME TAX TO NET CASH FROM OPERATING ACTIVITIES

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Loss after income tax expense for the year</td><td>(4,456,097)</td><td>(705,588)</td></tr><tr><td>Adjustments for:</td><td></td><td></td></tr><tr><td>Depreciation and amortisation</td><td>130,691</td><td>32,425</td></tr><tr><td>Convertible Note Recognised Finance Costs</td><td>1,471,464</td><td>54,610</td></tr><tr><td>Director loan interest</td><td>-</td><td>6,911</td></tr><tr><td>Share of net loss - associates</td><td>4,136</td><td>-</td></tr><tr><td>Share-based payments</td><td>720,234</td><td>-</td></tr><tr><td>Change in operating assets and liabilities:</td><td></td><td></td></tr><tr><td>Decrease/(increase) in trade and other receivables</td><td>149,481</td><td>(70,411)</td></tr><tr><td>Increase/(decrease) in trade and other payables</td><td>29,860</td><td>133,884</td></tr><tr><td>Increase/(decrease) in provisions</td><td>43,067</td><td>-</td></tr><tr><td>Net cash from operating activities</td><td>(1,907,164)</td><td>(548,169)</td></tr></table>

## NOTE 28. NON-CASH INVESTING AND FINANCING ACTIVITIES

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Additions to the right-of-use assets</td><td>177,703</td><td>-</td></tr><tr><td>Options issued under employee share plan</td><td>720,234</td><td>-</td></tr><tr><td></td><td>897,937</td><td>-</td></tr></table>

## NOTE 29. EARNINGS/(LOSS) PER SHARE

<table><tr><td></td><td>2021</td><td>2020</td></tr><tr><td></td><td>$</td><td>$</td></tr><tr><td>Basic loss per share</td><td>(6.02)</td><td>(4.74)</td></tr><tr><td>Diluted loss per share</td><td>(6.02)</td><td>(4.74)</td></tr></table>

The loss and weighted average number of ordinary shares used in the calculation of basic earnings per share is as follows:

<table><tr><td>Loss for the year</td><td>(4,456,097)</td><td>(707,588)</td></tr><tr><td>Weighted average number of shares outstanding during the year used in the calculations of basic loss per share:</td><td>74,053,220</td><td>14,917,808</td></tr></table>

There is no dilution of shares due to options as the potential ordinary shares are not dilutive and are therefore not included in the calculation of diluted loss per share.



## NOTE 30. EVENTS AFTER THE REPORTING PERIOD

The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has been financially positive for the Group up to 30 June 2021, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided.

On 2 September 2021, Professor Jonathan Clark AM was appointed to Singular Health Group’s newly formed advisory board. In line with the Group’s vision of Developing Better Health Literacy, which spans improving patient education through to the design and manufacture of patient-specific surgical implants, Singular Health is pleased to announce the formation of an advisory board. The advisory Board will consist of key opinion leaders with a broad cross-section of academic, commercial and crucially, clinical experience who will provide technical and clinical advice to guide the development, commercialization and integration of Singular’s medical software solutions into standard medical workflows.

Apart from the matters detailed above, no other matter or circumstance has arisen since 30 June 2021 that has significantly affected, or may significantly affect the Group’s operations, the results of those operations, or the Group’s state of affairs in future financial years.



## Singular Health Group Ltd
Directors' declaration
30 June 2021

In the directors' opinion:

- the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements;

- the attached financial statements and notes comply with International Financial Reporting Standards as issued by the International Accounting Standards Board as described in note 1 to the financial statements;

- the attached financial statements and notes give a true and fair view of the Group’s financial position as at 30 June 2021 and of its performance for the financial year ended on that date;

- there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; and

The directors have been given the declarations required by section 295A of the Corporations Act 2001.

Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001.

On behalf of the directors



Thomas Hanly
Director

30 September 2021
Perth



## INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SINGULAR HEALTH GROUP LTD

Report on the Audit of the Financial Report

## Opinion

We have audited the financial report of Singular Health Group Ltd (the “Company”) and its controlled entities (the “Group”) which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors’ declaration.

In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:

i. giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its financial performance for the year then ended; and

ii. complying with Australian Accounting Standards and the Corporations Regulations 2001.

## Basis for Opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the “Code”) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s report.

## Key Audit Matters

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



## Key Audit Matters (continued)

<table><tr><td colspan="2">Related Party Transactions &amp; Share Based Payments to Key Management Personnel</td></tr><tr><td colspan="2">Refer to Remuneration Report, Note 19 Share Based Payments</td></tr><tr><td>During the year ended 30 June 2021, the Group transacted with Key Management Personnel and their related entities including:  ·Awarded share-based payments amounting to $720,234 in the form of share options and performance rights, to Key Management Personnel</td><td>Our procedures included, amongst others:  ·Enquiring and obtained confirmations from Key Management Personnel regarding related party transactions occurring during the period.  ·Reviewing minutes of meetings, ASX announcements and agreements, relating to the approval of such arrangements undertaken during the financial year.  ·Assessing the valuation methodology used by management to estimate fair value of share options issues, including testing the integrity of the information provided, assessing the appropriateness of the key assumptions input into the valuation model and recalculating the valuation using the Black Scholes Model.  ·Assessing whether the share-based payments have been appropriately classified and accounting for in the financial statements.  ·Assessing the appropriateness of the relevant disclosures in the financial statements.</td></tr><tr><td colspan="2">Valuation of Intangibles</td></tr><tr><td colspan="2">Refer to Note 9 Intangible Assets &amp; Note 26 Asset Acquisitions</td></tr><tr><td>During the year ended 30 June 2021, Singular Health Group Ltd (the legal acquirer) acquired all of the software and intellectual property owned and developed by VR Surgical Pty Ltd for $250,000 in cash and the issue of $250,000 worth of Singular Health shares (which will be subject to 12 months escrow).</td><td>·Reviewed the Asset Sale Agreement and underlying terms and conditions of the transaction.  ·Reviewing minutes of meetings and ASX announcements relating to the asset acquisition undertaken during the financial year.  ·Assessed the reasonableness of management assertions and estimated regarding estimated useful life of the asset.  ·Held discussions with management that the amortisation period (useful life) at the end of the financial year remained appropriate and that there were no conditions which would adversely affect the valuation of the intangibles  ·Reviewed workings to ensure accounting for asset acquisition were in line with Australian Accounting Standards.  ·Tested the amortisation expense recorded and ensured consistency with the accounting policy.  ·Considered whether the relevant disclosures in the financial statements were appropriate and adequate.</td></tr><tr><td>The carrying value of the Intellectual Property of VR Surgical as at 30 June 2021 was $500,000 and the related amortisation charge for the year ended 30 June 2021 was $11,986.</td><td>This is a key area of audit focus because the carrying value is material and the value is subject to significant management judgement and estimates.</td></tr></table>



## Other Information

The directors are responsible for the other information. The other information comprises the information included in the Company’s annual report for the year ended 30 June 2021, but does not include the financial report and our auditor’s report thereon.

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

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

## Responsibilities of the Directors for the Financial Report

The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the directors are responsible for assessing the ability of the Company to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

## Auditor’s Responsibilities for the Audit of the Financial Report

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

A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: https://www.ausab.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our audit report.



## Report on the Remuneration Report

## Opinion on the Remuneration Report

We have audited the Remuneration Report as included in the directors' report for the year ended 30 June 2021.

In our opinion, the Remuneration Report of Singular Health Group Ltd, for the year ended 30 June 2021 complies with section 300A of the Corporations Act 2001.

## Responsibilities

The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.



PARTNER

Signed at Perth on the 30 \( ^{th} \)  day of September 2021



MOORE AUSTRALIA AUDIT (WA)

CHARTERED ACCOUNTANTS



## Singular Health Group Ltd
Corporate Governance Statement

In accordance with ASX Listing Rule 4.10.3 the Company’s corporate governance statement can be found at the following URL:

http://singular.health/wp-content/uploads/2021/09/SHG-Corporate-Governance-Statement_30-June-2021-4th-Edition.pdf

The Board of Directors is responsible for the corporate governance of the Company. The Board guides and monitors the business and affairs of the Company on behalf of Shareholders by whom they are elected and to whom they are accountable.

This statement outlines the main corporate governance practices in place throughout the financial year, which comply with the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations with 2019 Amendments 4 \( ^{th} \)  edition unless otherwise stated.



Additional information required by the ASX Limited Listing Rules not disclosed elsewhere in this Annual Report is set out below.

## 1. Shareholdings

The issued capital of the Company as at 23 September 2021 is 102,798,867 ordinary fully paid shares, 38,673,867 escrowed ordinary shares, 10,000,000 employee performance rights, and 19,250,000 unlisted options (details below). All issued ordinary fully paid shares carry one vote per share.

## Ordinary Shares

<table><tr><td>Shares Range</td><td>Holders</td><td>Units</td><td>%</td></tr><tr><td>1-1,000</td><td>207</td><td>168,871</td><td>0.16</td></tr><tr><td>1,001-5,000</td><td>1,033</td><td>2,791,192</td><td>2.72</td></tr><tr><td>5,001-10,000</td><td>434</td><td>3,599,829</td><td>3.50</td></tr><tr><td>10,001-100,000</td><td>528</td><td>16,596,333</td><td>16.14</td></tr><tr><td>100,001 and above</td><td>90</td><td>79,642,642</td><td>77.47</td></tr><tr><td>Total</td><td>2,292</td><td>102,798,867</td><td>100.00</td></tr></table>

## Unmarketable parcels

There were 682 holders with less than a marketable parcel of ordinary shares, totaling 944,788 shares or 0.92%

## 2. Top 20 Shareholders as at 23 September 2021

<table><tr><td></td><td>Holder Name</td><td>Holding</td><td>%</td></tr><tr><td>1</td><td>SIM TEK TAN</td><td>8,780,000</td><td>8.54%</td></tr><tr><td>2</td><td>CHONG LING DIAMOND CHEONG</td><td>7,065,754</td><td>6.87%</td></tr><tr><td>3</td><td>JLI ENTERPRISES PTY LTD &lt;JLI A/C&gt;</td><td>4,900,000</td><td>4.77%</td></tr><tr><td>4</td><td>JCC HEALTH PTY LTD &lt;THE JDE MEDVR A/C&gt;</td><td>4,380,000</td><td>4.26%</td></tr><tr><td>5</td><td>SYLVAN CAPITAL PTE LTD</td><td>3,500,000</td><td>3.40%</td></tr><tr><td>6</td><td>MR PAK LIM KONG</td><td>3,473,973</td><td>3.38%</td></tr><tr><td>7</td><td>SC CONSULTANT PTY LTD</td><td>3,161,918</td><td>3.08%</td></tr><tr><td>8</td><td>GARRY TET KHENG CHONG</td><td>3,000,000</td><td>2.92%</td></tr><tr><td>9</td><td>CS THIRD NOMINEES PTY LIMITED &lt;HSBC CUST NOM AU LTD 13 A/C&gt;</td><td>2,878,376</td><td>2.80%</td></tr><tr><td>10</td><td>PENINSULA TREESCAPE PTY LTD &lt;THE CARDINALS A/C&gt;</td><td>2,700,000</td><td>2.63%</td></tr><tr><td>11</td><td>SANDHURST TRUSTEES LTD &lt;CYAN C3G FUND A/C&gt;</td><td>2,425,000</td><td>2.36%</td></tr><tr><td>12</td><td>WANG (AUST) PTY LTD</td><td>2,340,000</td><td>2.28%</td></tr><tr><td>13</td><td>STAINED GLASS WINDOWS PTY LTD &lt;THE FAST LANE SF A/C&gt;</td><td>2,000,000</td><td>1.95%</td></tr><tr><td>14</td><td>FAYWENG PTY LTD</td><td>2,000,000</td><td>1.95%</td></tr><tr><td>15</td><td>MR PHILIP JOHN CAWOOD</td><td>1,804,795</td><td>1.76%</td></tr><tr><td>16</td><td>JEBTAI PTY LTD</td><td>1,000,000</td><td>0.97%</td></tr><tr><td>17</td><td>MR LIM PAK KONG</td><td>1,000,000</td><td>0.97%</td></tr><tr><td>18</td><td>RICHARD TAI PTY LTD</td><td>1,000,000</td><td>0.97%</td></tr><tr><td>19</td><td>GRANGE CONSULTING GROUP PTY LTD</td><td>1,000,000</td><td>0.97%</td></tr><tr><td>20</td><td>BNP PARIBAS NOMINEES PTY LTD &lt;IB AU NOMS RETAILCLIENT DRP&gt;</td><td>958,891</td><td>0.93%</td></tr><tr><td>21</td><td>ROYANNA PTY LTD &lt;ROYANNA SUPER FUND A/C&gt;</td><td>850,000</td><td>0.83%</td></tr><tr><td>22</td><td>LOMBARDI SUPER PTY LTD &lt;LOMBARDI SUPER FUND A/C&gt;</td><td>850,000</td><td>0.83%</td></tr><tr><td>23</td><td>AUSGLOBAL ONE PTY LTD</td><td>838,974</td><td>0.82%</td></tr><tr><td>24</td><td>REENERGISE AUSTRALIA PTY LTD &lt;JRH FAMILY A/C&gt;</td><td>830,000</td><td>0.81%</td></tr><tr><td>25</td><td>GRAHAM HUGH MOORE</td><td>800,000</td><td>0.78%</td></tr><tr><td>26</td><td>Total</td><td>63,537,681</td><td>61.81%</td></tr><tr><td>27</td><td>Balance other holders</td><td>39,261,186</td><td>39.19%</td></tr><tr><td>28</td><td>Total issued capital</td><td>102,798,867</td><td>100.00%</td></tr></table>



## 3. Unquoted securities

There are 10,000,000 performance rights and 19,250,000 unlisted options over shares in the Company as at 23 September 2021 as follows:

<table><tr><td>Security Type</td><td>Grant date</td><td>Expiry date</td><td>Exercise price</td><td>Number of Options</td><td>Number of Performance Rights</td></tr><tr><td>SHGPERFA24 - PERFORMANCE RIGHTS - CLASS A (ESC 24M) (1)</td><td>12/02/2021</td><td>31/12/2023</td><td>Nil</td><td>-</td><td>4,850,000</td></tr><tr><td>SHGPERFB24 - PERFORMANCE RIGHTS - CLASS B (ESC 24M) (1)</td><td>12/02/2021</td><td>31/12/2024</td><td>Nil</td><td>-</td><td>4,850,000</td></tr><tr><td>SHGPERFA12 - PERFORMANCE RIGHTS - CLASS A (ESC 12M) (1)</td><td>12/02/2021</td><td>31/12/2023</td><td>Nil</td><td>-</td><td>150,000</td></tr><tr><td>SHGPERFB12 - PERFORMANCE RIGHTS - CLASS B (ESC 12M) (1)</td><td>12/02/2021</td><td>31/12/2024</td><td>Nil</td><td>-</td><td>150,000</td></tr><tr><td>SHGOPT01 - UNLISTED OPTIONS @ $0.30 ESC 24M</td><td>12/02/2021</td><td>12/02/2025</td><td>0.123</td><td>19,250,000</td><td>-</td></tr><tr><td></td><td></td><td></td><td>Total</td><td>19,250,000</td><td>10,000,000</td></tr></table>

 \( ^{(1)} \) See section 4 below for further details.

The names of the security holders holding more than 20% of an unlisted class of security are listed below:

<table><tr><td>Holder</td><td>PERFORMANCE RIGHTS - CLASS A</td><td>PERFORMANCE RIGHTS - CLASS B</td><td>UNLISTED OPTIONS @ $0.30</td></tr><tr><td>JCC HEALTH PTY LTD</td><td>1,200,000</td><td>1,200,000</td><td>4,500,000</td></tr><tr><td>J J TAN (PERTH) PTY LTD MILES</td><td></td><td>1,200,000</td><td>-</td></tr><tr><td>THOMAS SYLVANUS HANLY</td><td>1,500,000</td><td>1,500,000</td><td>6,000,000</td></tr><tr><td>Total number of holders</td><td>7</td><td>7</td><td>7</td></tr><tr><td>Total holdings over 20%</td><td>3,900,000</td><td>3,900,000</td><td>10,500,000</td></tr><tr><td>Other holders</td><td>1,100,000</td><td>1,100,000</td><td>8,750,000</td></tr><tr><td>Total</td><td>5,000,000</td><td>5,000,000</td><td>19,250,000</td></tr></table>

## 4. Performance Rights (Allotment – 12 February 2021)

<table><tr><td>TRANCHE</td><td>No. of Performance Rights</td><td>Vesting Condition to convert into one share in the Company per Performance Right</td><td>Expiry Date</td><td>Vested (Yes/No)</td><td>Comment</td></tr><tr><td>Class A Performance Rights</td><td>5,000,000</td><td>The Shares are admitted to the Official List of ASX; and The company achieves a Gross Revenue of at least $1.25m for the 2022-2023 financial year.</td><td>31/12/2023</td><td>No</td><td>n/a</td></tr><tr><td>Class B Performance Rights</td><td>5,000,000</td><td>The Shares are admitted to the Official List of ASX; and The company achieves a Gross Revenue of at least $2.5m for the 2023-2024 financial year</td><td>31/12/2024</td><td>No</td><td>n/a</td></tr><tr><td>TOTAL</td><td>10,000,000</td><td></td><td></td><td></td><td></td></tr></table>



## 5. Substantial shareholders as at 23 September 2021

<table><tr><td>Holder</td><td>Number of shares held</td><td>% of issued capital held</td></tr><tr><td>SIM TEK TAN</td><td>8,780,000</td><td>8.54%</td></tr><tr><td>CHONG LING DIAMOND CHEONG</td><td>7,065,754</td><td>6.87%</td></tr></table>

## 6. Restricted securities subject to escrow period

The following ordinary shares are subject to escrow:

<table><tr><td>Security class</td><td>Number of securities held</td></tr><tr><td>SHGESC12 - Escrowed Shares (ESC 27/01/2022)</td><td>595,587</td></tr><tr><td>SHGESC13 - Escrowed Shares (ESC 24M FROM QUOTATION)</td><td>34,509,798</td></tr><tr><td>SHGESC15 - Escrowed Shares (ESC 26/05/2022)</td><td>568,482</td></tr><tr><td>SHGESCA - Advisor Shares (ESC 24M from Listing)</td><td>3,000,000</td></tr><tr><td>SHGOPT01 - UNLISTED OPTIONS @ $0.30 ESC 24M</td><td>19,250,000</td></tr><tr><td>SHGPERFA24 PERFORMANCE RIGHTS - CLASS A (ESC 24M)</td><td>4,850,000</td></tr><tr><td>SHGPERFB24 PERFORMANCE RIGHTS - CLASS B (ESC 24M)</td><td>4,850,000</td></tr><tr><td>SHGPERA12 PERFORMANCE RIGHTS - CLASS A (ESC 12M)</td><td>150,000</td></tr><tr><td>SHGPERFB12 PERFORMANCE RIGHTS - CLASS B (ESC 12M)</td><td>150,000</td></tr></table>

## 7. On-market buyback

There is currently no on-market buyback program for any of Singular Health Group Limited’s listed securities.

## 8. Group cash and assets

In accordance with Listing Rule 4.10.19, the Company confirms that it has been using the cash and assets it had acquired at the time of admission and for the year ended 30 June 2021 in a way that is consistent with its business objective and strategy.