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 period. 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. Research and development receivable and revenue Area of focus (refer also to notes 2, 4 and 6) During the financial year and as disclosed in note 4, the Group recorded income of $2.8m related to reimbursable R&D tax incentives inclusive of the FY25 estimated claim of $2.8m. The income was recognised in accordance with the Group’s accounting policy. As at 30 June 2025, an income tax R&D receivable related to the FY25 estimated claim of $2.8m is recorded on the statement of financial position as disclosed in note 6. Despite there being a history of the claims being approved and subsequently received there remains a risk that the R&D receivable is overstated with expenses inappropriately included in the claim and revenue therefore overstated, or expenses included within both the R&D and other government grant claims therefore allowing the Group to “doubledip”. This matter was considered a Key Audit Matter due to the complexity and judgement applied in calculating the R&D claim and the material nature of the claim. How our audit addressed the key audit matter Our audit procedures included: — Income recognised from the FY25 R&D claim was tested substantively to assess it was recognised correctly as per AASB 120 Accounting for Government Grants and Disclosure of Government Assistance and the Group’s accounting policy; — Performed substantive testing of a sample of FY25 R&D expenditure incurred and employment payroll costs which are included in the FY25 R&D claim; — The R&D tax incentive claim workings were assessed by our specialist William Buck R&D team for its appropriateness with respect ATO guidelines to consider if expenditure is deemed eligible; and — Vouched the prior period receivable amount to cash at bank in relation to the FY24 claim. We assessed the adequacy of the financial statement disclosures concerning the Group’s accounting policies with respect to the current claim and the disclosure within the notes to the financial report. Convertible notes Area of focus (refer also to notes 2, 9 and 11) During the year, the Group entered into a convertible note arrangement with sophisticated investors raising a total of $2.6 million. On review of the conversion features, it was determined that there was a value How our audit addressed the key audit matter Our audit procedures included: — Assessed the requirements of AASB 9 Financial Instruments and AASB 132 Financial instruments: Presentation to consider whether the convertible debt was Annual Report 2025 48
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