Ann: Appendix 4D and Half Year Report, page-20

I agree that the company must conduct ongoing product tests, especially with changes in formula and new product introductions. The tests must be robust and pass all standards to be able to then commercialize the product.  Until sales are made there will be pressures on cash reserves and the company’s operations; and this leads to intense scrutiny of management decisions and the company’s accounts.

That said, the following notes to the accounts drew my attention and I would welcome receiving your (anyone’s?) thoughts.

NOTE 4: CONTINGENT LIABILITIES AND CONTINGENT ASSETS
Under a resale price commitment agreement between the Company and an employee currently in the process of being finalized, the Company has tentatively agreed to reimburse the employee for an amount yet to be determined (ranging from US$200,000 to US$400,000) in lost home value if the employee were to sell their home at a loss on or before June 30, 2027, subject to certain exceptions. The Directors are not aware of any other contingent assets or contingent liabilities as at 31 December 2017.

NOTE 7: RELATED PARTY TRANSACTIONS
The Group reimbursed Mr R Marmaro for moving costs incurred in the amount of US$41,161 and recorded an accrual for additional moving expenses in the amount of US$31,609.

BL