CPU Detail Fin Text OUTPUT - Computershare

CONTENTSCorporate Governance Statement

Directors’ Report

Statements of Financial Performance

Statements of Financial Position

Statements of Cash Flows

Notes to the Financial Statements

Directors’ Declaration

Independent Audit Report

Shareholder Information

Corporate Directory

FINANCIAL CALENDAR

200328 August Announcement of result for the Company’s 2003 financial year

12 September Books close for final dividend

26 September Payment of final dividend

11 November Annual General Meeting - Melbourne

200426 February Announcement of result for the half year ending 31 December 2003

Computershare Limited ABN 71 005 485 825

CORPORATE GOVERNANCE STATEMENT

BOARD RESPONSIBILITIESThe Board of directors of Computershare Limited is responsible for the corporate governance of the Computershare Group. Theprincipal role of the Board in this capacity is to ensure the long term prosperity of the Group by setting broad corporate governancepolicies and ensuring that they are effectively implemented by management. The Board carries out this role principally by:

• overseeing the Group and its global operations;

• appointing and removing, where appropriate, the senior executives of the Group;

• setting the strategic direction of the Group and providing strategic advice to management;

• providing input into and approval of management’s development of corporate strategy and performance objectives;

• reviewing and ratifying systems of governance, risk management, and internal compliance and control, codes of conduct andlegal compliance to ensure appropriate compliance frameworks and controls are in place;

• approval of budgets and monitoring progress against budget via the establishment and reporting of both financial and non-financial key performance indicators.

BOARD MEETINGSThe Board meets quarterly in conjunction with senior management to discuss the short and long term strategy of the Group.

The Board receives a monthly Board report which provides the Board with current information concerning the Group and each ofthe three regions in which it operates, together with a report from the CTS Managing Director. The monthly Board report includessalient financial details together with information on the performance of operations, major initiatives as well as legal andcompliance issues.

The Board convenes monthly by phone conference to review the monthly Board report, discuss matters of importance withmanagement, make recommendations to management, discuss strategy and plan quarterly Board meetings.

BOARD COMPOSITIONThe Company has for the past several years been revising the composition of its Board of directors to better reflect the globalnature of its businesses. Consistent with this effort, the number of Australian-based directors has declined, and new directors havebeen added from the North American and European regions in which the Company operates. The Board believes that the non-executive directors bring the necessary range of skills, knowledge, and experience to govern the Group and understand themarkets and challenges that the Group faces.

Details regarding each of the current Board members and their respective shareholdings and remuneration are set out in theDirectors’ Report.

Current Board Composition:Name Appointed Non- Independent Executive Retiring Seeking election

Executive in 2003 or re-election in 2003

Alexander Stuart Murdoch 1994 Yes Yes No No N/A

Christopher John Morris 1978 No No Yes No N/A

Penelope Jane Maclagan 1995 No No Yes Yes Yes

Anthony Norman Wales 1980 Yes No No Yes Yes

William E Ford 2003 Yes No No N/A Yes

Peter John Griffin 1994 Yes Yes No Yes No

Thomas Butler 2003 Yes Yes No N/A Yes

Philip Daniel DeFeo 2002 Yes Yes No No N/A

1Computershare Detailed Financial Report 2003

CORPORATE GOVERNANCE STATEMENT (continued)

The Company’s constitution provides that:

• The minimum number of directors shall be 3 and the maximum number of directors shall be 10 unless amended by aresolution passed at a general meeting.

• At each annual general meeting, at least two directors must retire from office. Re-appointment is not automatic. If retiring directors wish to continue to hold office, they must submit themselves to re-election by shareholders.

• No director may be in office for longer than 3 years without facing re-election.

IndependenceThe concept of independence in the context of directors is variously defined. The Board has considered each of the 8 directors inoffice at the date of this report and determined that four of them are independent. The four directors who are not consideredindependent are Mr Christopher Morris and Ms Penelope Maclagan who are each executive directors, Mr Anthony Wales who is asubstantial shareholder and a former executive director and Mr Bill Ford who is associated with a substantial shareholder.

Of the four independent directors, none has previously been an employee of the Group and the Board believes that none has anyrelationship that could materially interfere with the exercise of their independent judgment.

No directors participate in share, share option or performance based plans. Non-executive directors receive only cashcompensation and reimbursement of expenses for their services.

BOARD COMMITTEESIt is the Board’s policy that committees dealing with corporate governance matters should be chaired by a non-executive directorand have at least a majority of members being non-executive directors. Any director or committee of the Board is entitled to obtainindependent professional or other advice at the Company’s cost, unless the Board determines otherwise, and is entitled to obtainsuch resources and information from the Company, including direct access to employees of and advisers to the Company, as theymay require.

Three Board Committees have been established to assist the Board in discharging its responsibilities as follows:

The Risk and Audit CommitteeThe principal functions of the Risk and Audit Committee include reviewing and making recommendations to the Board andassisting it in the discharge of its responsibilities relating to accounting policy and disclosure. It is responsible for assessing theadequacy of accounting, financial and operating controls, reviewing the performance of external auditors and examining theirevaluation of internal controls and management’s response.

The Risk and Audit Committee is chaired by Mr Tony Wales and has two other permanent members being Mr Sandy Murdoch andMr Peter Griffin. The Managing Director, Chief Financial Officer, Chief Legal Officer and the Company’s external auditors are invitedto Risk and Audit Committee meetings at the discretion of the Committee. The Committee meets at least twice each year. As MrGriffin is not seeking re-election as a director, the Board is currently considering a replacement for his role on this Committee.

The Nomination CommitteeThe composition of the Board is reviewed at least annually by the Nomination Committee to ensure that the Board has theappropriate range of expertise and experience. Any selection of suitable candidates for the position of director must stand forelection at the general meeting of shareholders. The Nomination Committee is comprised of all of the directors, which the Boardfeels gives it the broadest range of input from the diverse members of the Board.

2 Computershare Detailed Financial Report 2003

The Remuneration CommitteeThe principle function of the Remuneration Committee is to assist the Board in ensuring that the Computershare Group’s remunerationlevels are appropriate and sufficient to attract and retain the directors and key executives needed to run the Group.

The Committee is chaired by Mr DeFeo and comprises Mr Murdoch, Mr Wales, Mr Griffin and Mr Morris.

The Committee meets at least annually with additional meetings being convened as required. The Committee has access toexecutive management of the Group and may consult independent experts where the Committee considers this necessary in orderto effectively discharge its responsibilities.

As a policy, the Board seeks to remunerate staff in accordance with market conditions and reflective of their contribution. TheBoard is keen to encourage equity holdings by employees to align staff interest with that of shareholders. Many staff haveparticipated in the Company’s various share and option plans and the directors believe this has historically been a significantcontributing factor to the Company’s success.

IDENTIFYING SIGNIFICANT BUSINESS RISKS There are a variety of risks that exist in the markets in which Computershare operates and there are a range of factors, some ofwhich are beyond the control of Computershare, which may impact on the Company’s performance.

The Board and senior management work actively to identify, review, analyse and mitigate significant areas of risk across the Group.The Board in conjunction with the Risk and Audit Committee reviews and approves the parameters under which such risks aremanaged including the responsibility for internal control systems, the procedure for identifying business risks and the methods tocontrol their financial impact on the Company.

Although no system of risk management can provide total assurance that all risks will be fully diminished, the Company’s approachto risk management seeks to meet the Group’s specific needs and minimise the risks to which it is exposed.

ETHICAL STANDARDSThe Company recognises the need for directors and staff to observe the highest standard of behaviour and business ethics whenengaging in corporate activity.

The Board has adopted a code of ethics that sets out the principles and standards with which all officers and employees areexpected to comply in the performance of their respective functions. A key element of that code is the requirement that directors,officers and staff act in accordance with the law and with the highest standards of propriety. The code and the methods of itsimplementation are reviewed annually.

ANNUAL REVIEWIn order to ensure that the Board continues to discharge its duties effectively the performance of all directors is reviewed at leastannually by the Chairman. The Board also annually reviews the performance of senior management.

CONFLICTS OF INTEREST AND INDEPENDENT ADVICEIf a director has a potential conflict of interest in a matter under consideration, that director must abstain from deliberations onthose matters. In that instance the director is not permitted to exercise any influence over other Board members on that issue norreceive relevant Board papers.

The Company permits directors to obtain advice about transactions or matters of concern at the Company’s cost. Approval ofdirectors seeking independent advice is subject to the approval of the Chairman acting reasonably.

COMMITMENT TO AN INFORMED MARKET RELATING TO COMPUTERSHARE SECURITIES The Board has approved a market disclosure policy to ensure the fair and timely disclosure of price sensitive information to theinvestment community as required by applicable law. Mr Paul Tobin, Computershare’s joint Company Secretary and Chief LegalOfficer, has been appointed the disclosure officer and is required to keep abreast of all material information and where appropriate,ensure disclosure of share price sensitive information.


CORPORATE GOVERNANCE STATEMENT (continued)

CODE OF PRACTICE FOR BUYING AND SELLING COMPUTERSHARE SECURITIESThe freedom of directors and executives to deal in Computershare’s securities is restricted in a number of ways – by statute, bycommon law and by the requirements of the listing rules of the ASX. In addition to these restrictions, the Company has adopted acode of practice for buying and selling Computershare securities. The code of practice contains additional restrictions on dealing.The code of practice provides that directors or executives may only deal in Computershare securities, provided they are not inpossession of material non-public information, in the four weeks immediately following the Company’s half year and full yearfinancial results announcements and, if relevant, any Annual General Meeting announcement. Directors and executives may onlydeal in Computershare securities outside of these times with the express prior approval of the Chairman.

EQUITY PARTICIPATION BY NON-EXECUTIVE DIRECTORSThe Board encourages non-executive directors to own shares in the Company.

SHAREHOLDER RELATIONSThe Board of directors aims to ensure that shareholders are informed of all information necessary to assess the performance of thedirectors. Information is communicated to the shareholders through:

• the annual report which is distributed to all shareholders;

• the annual general meeting and other shareholder meetings called to obtain approval for Board action as appropriate;

• making available all information released to the Australian Stock Exchange on the Company’s website atwww.computershare.com immediately following confirmation of receipt by the Australian Stock Exchange. This informationincludes annual reports, half yearly results, notice of general meeting and associated explanatory documents and othermarket announcements;

• in circumstances where presentations are the subject of a webcast, making available the webcast on the Company’s websiteshortly after the close of the presentation;

• ensuring all press releases issued by Computershare Limited are posted on the Company’s website;

• encouraging active participation by shareholders at General Meetings. For shareholders who are unable to attend and vote atGeneral Meetings, the Company encourages shareholders to vote electronically by accessing the Company’s website where,in advance of a General Meeting, shareholders can view an electronic version of the proxy form and submit their votes;

• actively encouraging shareholders to provide their e-mail addresses to facilitate more timely and effective communicationwith shareholders at all times;

• contacting shareholders who have provided e-mail addresses directly to provide details of upcoming events of interest;

• encouraging all shareholders who are unable to attend general meetings of the Company to communicate issues or askquestions by writing to the Company.

COMPANY SECRETARIESThe Company Secretaries are Mr Paul Tobin and Mr Mark Davis. Under the Company’s Constitution, the appointment and removalof the Company Secretaries is a matter for the Board. Amongst other matters, the Company Secretaries advise the Board ongovernance procedures and seek to support the effectiveness of the Board by monitoring Board policy and procedures andcoordinating the completion and despatch of the Board meeting agendas and papers. All directors have access to the advice andservices of the Company Secretaries.

ASX CORPORATE GOVERNANCE COUNCIL RECOMMENDATIONSThis Corporate Governance Statement reflects the corporate governance practices that have been in place throughout the financialyear ended 30 June 2003. On 31 March 2003, the ASX Corporate Governance Council released its principles of “Good CorporateGovernance and Best Practice Recommendations”. While the Company’s current practices substantially accord with theseprinciples and recommendations, the Company has undertaken a process to review its corporate governance practices and willmake a full statement on its compliance with the best practice recommendations in its 2004 Annual Report.


DIRECTORS’ REPORTThe board of directors of Computershare Limited has pleasure in submitting its report in respect of the financial year ended 30 June 2003.

DIRECTORSThe following directors were directors during the whole of the financial year and up to the date of this report:

A S Murdoch (Chairman)C J Morris (Managing Director)P D DeFeoP J GriffinP J MaclaganA N Wales

W E Ford was appointed a director on 17 January 2003 and continues in office at the date of this report.T M Butler was appointed a director on 15 May 2003 and continues in office at the date of this report.I D Saville was a director from the beginning of the financial year until his resignation on 15 May 2003.

The qualifications, experience and responsibilities of directors are outlined on pages 32 to 33 of the 2003 Concise Annual Report.

DIRECTORS’ INTERESTS At the date of this report, the direct and indirect interests of the directors in the shares of the company are:

Name Number of options Number of Number of reset ordinary shares preference shares

T M Butler – – –P D DeFeo – 40,000 –W E Ford – – –P J Griffin – 1,900,000 –P J Maclagan – 16,567,525 1,330C J Morris – 55,447,042 –A S Murdoch – 609,800 –A N Wales – 32,592,384 –

DIRECTORS’ MEETINGSThe number of meetings of the Board of directors (and of Board committees) and the number of meetings attended by each of thedirectors during the financial year are:

Audit Nomination RemunerationDirectors’ Committee Committee CommitteeMeetings Meetings Meetings Meetings

A B A B A B A B

A S Murdoch 6 6 4 5 2 2 1 1T M Butler* – – – – – – – –P D DeFeo 6 6 – – 2 2 1 1W E Ford* 2 2 – – – – – –P J Griffin 6 6 4 5 2 2 1 1P J Maclagan 6 6 – – 2 2 – –C J Morris 6 6 – – 2 2 1 1I D Saville* 4 6 – – – – – –A N Wales 6 6 5 5 2 2 1 1A - Number of meetings attendedB - Number of meetings held during the time the director held office during the year.* I D Saville is no longer a director and resigned on 15 May 2003. W E Ford was appointed a director on 17 January 2003. T M Butler was appointed a director

on 15 May 2003.


DIRECTORS’ REPORT (continued)

PRINCIPAL ACTIVITIES The principal activities of the consolidated entity during the course of the financial year were the operation of computer technologyservices, operation of share registries, including the administration of employee share and option plans and the provision ofsoftware specialising in share registry, financial services and stock markets. The Group also offers corporate trust services and actsas trustee for clients’ debt offerings in certain markets and provides share ownership and other investor relations services throughits Analytics businesses and print and mail distribution services through its Document services businesses. During the year theGroup entered the Shareholder Relationship Management business, which provides listed companies with tools to derive valuefrom their shareholder base.

Computershare is a registered securities transfer agent. In addition, certain subsidiaries are Trust companies whose chartersinclude the power to accept deposits, primarily acting as an escrow and paying agent on behalf of customers. In certainjurisdictions the Group is subject to regulation by certain federal, provincial and state agencies and undergoes periodicexaminations by those regulatory agencies.

There were no other significant changes in the nature of the activities of the consolidated entity during the year.

CONSOLIDATED PROFITThe profit of the consolidated entity for the financial year was $17,132,581 after income tax and $16,255,550 after outside equityinterests. The profit after tax and outside equity interests represents a 77% decline on the 2002 result of $71,293,536. Profit of theconsolidated entity for the financial year excluding non-recurring items was $41,147,550 after income tax and outside equityinterests. This represents a 29% decline on the 2002 results of $57,930,984. Net profit before non-recurring items is determined asfollows:

Consolidated2003 2002

$000s $000s

Net profit 16,256 71,293Exclusion of normalising transactions, (net of tax);

Redundancies 16,234 –Property write-offs 4,980 –Asset write-offs 1,092 –Restructuring costs 2,586 –Hong Kong equity transaction – (13,362)

Net profit excluding non-recurring items (refer Note 2b) 41,148 57,931

DIVIDENDSThe following dividends of the consolidated entity have been paid, declared or recommended since the end of the precedingfinancial year:

Ordinary shares• A final ordinary dividend of two and a half cents per share amounting to $13,861,273 fully franked at 30% in respect of the

year ended 30 June 2002 was paid on 26 September 2002.

• An interim ordinary dividend of two and a half cents per share amounting to $13,421,042 fully franked at 30% in respect ofthe half year ended 31 December 2002 was paid on 31 March 2003.

• A final dividend recommended by the directors of the company in respect of the year ended 30 June 2003, to be paid on 26September 2003, is an ordinary dividend of two and a half cents per share amounting to $13,527,925 fully franked at 30%.This dividend was not declared until 28 August 2003 and accordingly no provision has been recognised at 30 June 2003.

Reset preference shares• A reset preference share dividend of 5.5% per annum amounting to $4,136,500 franked at 30%, in respect of the six months

ended 30 November 2002 was paid on 3 December 2002.

• A reset preference share dividend of 5.5% per annum amounting to $4,113,750 franked at 30% in respect of the six monthsended 30 May 2003 was paid on 3 June 2003.


• A reset preference share dividend of 5.5% per annum amounting to $678,083 has been accrued in respect of the period 1 June 2003 to 30 June 2003.

• The total preference share dividend referable to the year ended 30 June 2003 is $8,249,948.

REVIEW OF OPERATIONS The year was characterised by a continuation in the decline in corporate action activity combined with low interest rates both ofwhich significantly impact on revenue and profitability. In response to these factors, a strategy was implemented that had its focuson improving operational efficiencies, reducing costs, improving capital management and retaining clients.

The success of this strategy is reflected in sound results that place the company in a strong position to either withstand acontinued decline in market conditions or to benefit from any improvement in either corporate action activity or in interest rates,without adding significantly to the cost line.

The group has recorded an operating profit before tax and non-recurring items of $64.5 million for the year ended 30 June 2003(2002: $83.8 million). The result was achieved on revenue of $708.6 million (2002: $781.0 million). Before non-recurring items thegroup’s earnings before interest, tax, depreciation and amortisation (“EBITDA”) decreased by 9% to $133.9 million (2002: $147.6million). Computershare had an effective corporate tax rate of 41.8% during the year. Operating expenses were down 10% to$572.7 million. Following the 5% decline in the first half, operating costs were down a further 5% in the second half. Capitalexpenditure decreased by 68% from the year ended 30 June 2002 to $17.9 million.

Normalised basic earnings per share were 6.05 cents per share. The basic earnings per share were 1.47 cents per share.

During the year, there has been significant restructuring of the company’s global businesses, which comes at a short-term cost tonet profit after tax (“NPAT”). The before tax impact is $35.1 million of non-recurring costs, comprising $23.2 million in redundanciesand $11.9 million in write-offs and other restructure costs. The $35.1 million charge is expected to deliver more than $22 million perannum in on-going savings, of which $3.5 million was delivered in the year ended 30 June 2003.

Some of the one off restructuring items have occurred as a result of a group wide review of physical assets, which led to therecommended sale of property assets. The Board of directors has accepted the review with the expectation that asset sales willprovide capital gains in the next financial year.

The buy-back of the company’s shares came to a close, as announced, on 11 March 2003. This resulted in the purchase of18,710,000 ordinary shares for a total cost of $38,350,708 (at an average price of $2.05).

Total technology spending decreased from $106.7 million last year to $92.1 million. Of this amount, $38.6 million which related toresearch and development of a capital nature has been expensed.

A proportion of the total technology spending relates to activities designed to reduce dependency on outsourced bureau services.The migration of all major business onto the company’s own technology platform was completed in March 2003 with the resultthat external bureau costs for the financial year ended 30 June 2004 will be largely eliminated.

Operating expenses have decreased 10% on last year, with sustainable reductions in all cost categories. Excluding cost of sales,operating expenses declined 8%, equal to the 8% decline in sales revenue. Personnel costs decreased 5% reflecting a grossdecline of 575 people as a result of organisational restructuring and consolidation in all regions. The reduction in personnelnumbers, together with the continued focus on cost control, has contributed to the reduction in discretionary and overhead costs.

Regionally, revenues were apportioned between Asia Pacific 30%, North America 37% and Europe, Middle East and Africa (“EMEA”)33%, which is broadly consistent with last year. EBITDA was apportioned between Asia Pacific 40%, North America 27% and EMEA33%. The North American EBITDA contribution has increased from 18% at December 2002 demonstrating a significantimprovement in their profitability in the second half of the year. The second half EBITDA splits were Asia Pacific 37%, NorthAmerica 32% and EMEA 31%.

The Asia Pacific region contributed revenues of $214.6 million and EBITDA of $53.6 million. A decline in Registry performance waspartly offset by improved contributions from the Employee Plans and Document services businesses.

The EMEA region contributed revenues of $231.9 million and EBITDA of $44.3 million. The Employee Plans business experiencedsignificant growth during the year. With the exception of Technology services, the results of all other EMEA businesses wereunfavourably impacted by the market conditions.

The North American region contributed revenues of $258.8 million and EBITDA of $36.0 million. The Registry and Employee Plansbusinesses were considerably down on last year, reflecting the unfavourable market conditions. All other businesses, includingCanada’s Corporate Trust business, generated improved results on last year.

Improved working capital management contributed to the generation of $76.2 million of cash flow for the year. Debtors daysoutstanding was cut from 70 days at 30 June 2002 to 67 days at 30 June 2003.



SIGNIFICANT CHANGES IN THE STATE OF AFFAIRSSignificant changes in the affairs of the consolidated entity during the financial year which are reported in the consolidated financialstatements were:

• On 7 November 2002 the acquisition of the Employee Plans business from Charles Schwab was announced. This acquisitionserved to further strengthen the Group’s competitive position in the Employee Plans market in the US.

• On 17 December 2002 the company announced the acquisition of EFA Group assets for a cash payout of approximately $7.4 million. The assets acquired included the software rights to EFA’s trading systems and settlement and clearing systems.

• In March 2003 the company acquired an initial stake of 27% in ComputersharePepper SRM, a joint venture with PepperTechnologies. Shareholder Relationship Management (“SRM”) is an exciting, innovative approach that provides listedcompanies with tools to derive value from their shareholder base.

• In May 2003 Computershare purchased a 30% interest in The National Registry Company of Russia (“NRC”). NRC has a 20%domestic market share including a number of companies that are listed both in Russia and the United Kingdom.

• In June 2003 Computershare purchased the share registry and Employee Plans businesses of Fifth Third Bancorp in the USA.This acquisition will allow the company to modestly grow the share registry and Employee Plans businesses in the USA.

• The decline in total of shareholders’ funds of 10% was due to the share buy-back and the effect of foreign currencytranslation.

• Net borrowings increased by $43.2 million to $77.7 million to fund the share buy-back, increased dividends and acquisition of,and investments in businesses. Gearing – net debt to equity – increased to 13.2% from 5% over the past year.

New appointments to the BoardOn 17 January 2003 the board appointed William Ford to the Board as a non-executive director. Mr Ford is a general partner atGeneral Atlantic Partners, LLC where he has worked since 1991. General Atlantic is an international private equity investment firmfocused on information technology, process outsourcing and communications businesses globally. It has over USD 5 billion incapital under management. Mr Ford has brought an extensive understanding of financial markets and has specific expertise in thefinance and consumer sectors.

On 15 May 2003 the Board appointed Tom Butler to the Board as a non-executive director. Mr Butler has very broad Europeanindustry experience and most recently held the position of CEO at MSI prior to its successful trade sale to Marconi PLC for in excessof USD800 million. Prior to his successes at MSI, he was CEO and COO of Origin BV in the Netherlands.

In the opinion of the directors there were no other significant changes in the affairs of the consolidated entity during the financialyear under review that are not otherwise disclosed in this report or the consolidated accounts.

SIGNIFICANT EVENTS AFTER BALANCE DATENo matter or circumstance has arisen since the end of the financial year which is not otherwise dealt with in this report or in theconsolidated financial statements, that has significantly affected or may significantly affect the operations of the consolidatedentity, the results of those operations or the state of affairs of the consolidated entity in subsequent financial years, other than on19 August 2003 the company issued 548,271 ordinary shares to Citigroup in consideration of the release of the company’sobligation to issue up to 10,581,633 shares for $1.83 per share on the exercise of a like number of options.

LIKELY DEVELOPMENTS AND FUTURE RESULTSThere are indications that market activity began to pick up towards the end of the year. However it is not clear at this stage whetherthis is a sustainable trend. Equally it is difficult to predict with any certainty how interest rates will react over the coming twelvemonths. As in previous years, these two factors will largely drive profitability levels in the financial year ended 30 June 2004.

The focus on costs and improved management of working capital will continue throughout the coming year. The strategy positionsthe company to either benefit from an improvement in market activity (particularly corporate actions) and in interest rates or towithstand a continued decline in these two factors.


SHARE OPTIONSDetails of options granted to directors or relevant officers as part of their remuneration are set out in the section of this reportheaded Directors’ and Officers’ Remuneration. Details of shares under option, or issued during or since the end of the financial yeardue to the exercise of an option, are set out in Note 19. The Register of Options kept by the company pursuant to section 170 ofthe Corporations Act 2001 may be inspected by shareholders free of charge.

DIRECTORS’ AND OFFICERS’ REMUNERATIONRemuneration of directors and senior executives of the company is established by the Remuneration Committee. Remuneration isdetermined as part of an annual performance review, having regard to market factors and a performance evaluation process. Forexecutive directors and officers, remuneration packages generally comprise salary and superannuation. Executives are alsoprovided with longer-term incentives through the employee share ownership and option schemes, which act to align theexecutives’ actions with the interests of the shareholders.

The Board meets annually to review its own performance. The non-executive directors are responsible for evaluating theperformance of the Chief Executive, who in turn, and in conjunction with the Board, evaluates the performance of all other seniorexecutives.

Details of remuneration provided to directors and the five most senior executive officers of the consolidated entity and the parententity for the year ended 30 June 2003 are as follows:

Amortise Number ofTotal unvested Total unvested

Base Directors’ Other excluding shares and including shares andsalary fee Superannuation Bonus benefits Options options granted6,8 options options$ $ $ $ $ $ $ $ on issue

DirectorsA S Murdoch – 115,000 11,500 – – 126,500 – 126,500 –T Butler1 9,018 – – – – 9,018 – 9,018 –P D DeFeo – 99,422 – – – 99,422 – 99,422 –W Ford2 – – – – – – – – –P J Griffin – 100,000 10,000 – – 110,000 – 110,000 –P J Maclagan 400,979 – 36,088 – 40,903 477,970 – 477,970 –C J Morris 380,000 – 38,000 – – 418,000 – 418,000 –I D Saville5 541,126 – 115,276 – 1,655,065 2,311,467 – 2,311,467 –A N Wales – 75,000 7,500 – 36,688 119,188 – 119,188 –

Group and parent entity officers4

S Rothbloom 566,508 – 20,394 – 13,176 600,078 165,104 765,182 347,500R Waterhouse3 424,881 – – – 340,321 765,202 133,478 898,680 250,000P Tobin7 377,920 – 21,509 – 1,344 400,773 118,002 518,775 265,000S Crosby 349,920 – 10,519 – – 360,439 102,728 463,167 242,500 P Conn 339,904 – – – 173,339 513,243 55,890 569,133 140,000 T Honan7,8 300,000 – 10,519 – 54,765 365,284 57,871 423,155 167,000

1. Appointed as a director on 15 May 2003.2. Appointed as a director on 17 January 2003. 3. Other benefits include separation payment of $339,905.4. The officers included in this disclosure are those employees having, during the year, the greatest authority for managing the Group. Other employees who

have not had such authority may have received remuneration at a level in excess of that shown for the executives named above.5. Resigned as a director on 15 May 2003. Other benefits include a separation payment of $1,642,924.6. The company has adopted the fair value measurement provisions of ED 108 "Share-based Payment" for all options and shares granted to directors and

relevant executives, which have not vested as at 1 July 2002. The fair value of such grants is being amortised and disclosed as part of director and executiveemoluments on a straight-line basis over the vesting period. No adjustments have been or will be made to reverse amounts previously disclosed in relationto options that never vest (i.e., forfeitures). Prior to 1 July 2002, the company disclosed the fair value of option grants using the Black-Scholes option pricingmodel but did not allocate those values over the vesting period. Rather, the full fair value of the grant was disclosed as an emolument in the year of thegrant. As a result, the amounts disclosed above in relation to the 2003 financial year, include the amounts related to options which were granted in priorfinancial periods and therefore disclosed as part of emoluments in prior years as well. This is a one-off transitioning to the allocation of such amounts toemoluments over the vesting period rather than disclosure of the full amount as emoluments in the year of the grant. From 1 July 2002, options granted aspart of director and executive emoluments have been valued using a Black-Scholes option pricing model, which takes account of factors including theoption exercise price, the current level and volatility of the underlying share price, the risk-free interest rate, expected dividends on the underlying share,current market price of the underlying share, the expected life of the option and vesting period applicable to the options. For further details, refer to Notes19 and 21 to the financial statements.

7. T Honan is disclosed in his capacity as an executive of the parent entity. P Tobin is an executive of the parent entity and the group. There are only two non-director executives employed by the parent entity and the group. Other executives disclosed are group executives.

8. Other benefits disclosed in respect of T Honan represents the value of a grant of 30,000 ordinary shares during the year.



INDEMNIFICATION OF OFFICERS During the period, the company paid an insurance premium to insure directors and officers of the company and its controlledentities against liability. The directors of the company are as detailed earlier in the report and the contract also covers all executiveofficers and directors and executive officers of controlled entities.

Disclosure of the amount of insurance premium payable and a summary of the nature of liabilities covered by the insurancecontract is prohibited by a confidentiality clause in the contract.

ROUNDING OF AMOUNTSThe company is of a kind referred to in class order 98/0100, issued by the Australian Securities and Investments Commission,relating to the “rounding off” of amounts in the Directors’ Report. Amounts in the Directors’ Report have been rounded off inaccordance with that Class order to the nearest thousand dollars unless specifically stated to be otherwise.

Signed in accordance with a resolution of the directors.

AS MURDOCH CJ MORRISChairman Director16 September 2003


STATEMENTS OF FINANCIAL PERFORMANCEFOR THE YEAR ENDED 30 JUNE 2003

Consolidated Parent entityNote 2003 2002 2003 2002

$000s $000s $000s $000s

RevenuesSales revenue 2 694,519 757,055 – –Other revenue from ordinary activities 2 14,078 23,911 65,085 84,735

Total revenue from ordinary activities 2 708,597 780,966 65,085 84,735

ExpensesDirect services (a) 547,145 578,507 – –Technology services (a) 101,025 92,293 – –Corporate services (a) 20,633 16,249 14,079 16,597Borrowing costs 2 8,296 10,169 930 6,759

Total expenses 677,099 697,218 15,009 23,356

Share of net profit/(loss) of associates accounted for using the equity method 34 (2,036) – – –

Profit/(loss) from ordinary activitiesbefore related income tax expense 29,462 83,748 50,076 61,379Income tax (expense)/benefit relating to ordinary activities 3 (12,329) (25,995) (4,616) (2,823)

Net profit/(loss) 17,133 57,753 45,460 58,556Net (profit)/loss attributable to outside equity interests 2(b) (877) 13,540 – –

Net profit/(loss) attributable to members of the parent entity 4 16,256 71,293 45,460 58,556

Net exchange difference on translation of financialreports of self-sustaining foreign controlled entities 20 (24,321) (24,365) – –

Total revenues, expenses and valuation adjustments attributable to members of theparent entity recognised directly in equity (24,321) (24,365) – –

Total changes in equity attributable to members of the parent entity other than those resulting from transactions with owners as owners (8,065) 46,928 45,460 58,556

Basic earnings per share (cents per share) 5 1.47 12.00

Normalised basic earnings per share (cents per share) 5 6.05 9.60

Diluted earnings per share (cents per share) 5 2.60 12.20

Normalised diluted earnings per share (cents per share) 5 6.57 9.90

(a) Depreciation and amortisation expense for the prior period has been reclassified to Direct services, Technology services and Corporate services.

The above Statements of Financial Performance should be read in conjunction with the accompanying notes.


STATEMENTS OF FINANCIAL POSITIONFOR THE YEAR ENDED 30 JUNE 2003


$000s $000s $000s $000s

CURRENT ASSETSCash assets 60,828 74,327 3,608 9,542Receivables 6 132,220 150,210 5,137 2,965Other financial assets 7 36,653 41,526 – –Inventories 8 3,904 3,355 – –Current tax assets 11 941 1,731 – –Other 9 11,152 11,092 396 862

Total Current Assets 245,698 282,241 9,141 13,369

NON-CURRENT ASSETSReceivables 6 1,049 595 245,600 348,309Investments accounted for using the equity method 34 15,845 – – –Other financial assets 7 15,086 7,543 345,702 311,551Property, plant and equipment 10 133,619 146,958 4,094 4,738Deferred tax assets 11 47,175 39,804 10,579 5,181Intangibles - goodwill 12 431,502 479,461 – –Other 13 4,432 3,114 144 285

Total Non-Current Assets 648,708 677,475 606,119 670,064

Total Assets 894,406 959,716 615,260 683,433

CURRENT LIABILITIESPayables 14 111,044 134,442 7,739 11,607Interest bearing liabilities 15 5,564 5,975 598 994Current tax liabilities 16 5,876 12,439 9,769 114Provisions 17 24,287 23,036 678 14,535Other 18 2,569 566 – –

Total Current Liabilities 149,340 176,458 18,784 27,250

NON-CURRENT LIABILITIESInterest bearing liabilities 15 132,923 102,824 62,678 108,994Deferred tax liabilities 16 15,568 17,206 114 538Provisions 17 5,177 4,685 290 224Other 18 2,991 2,795 – –

Total Non-Current Liabilities 156,659 127,510 63,082 109,756

Total Liabilities 305,999 303,968 81,866 137,006

Net Assets 588,407 655,748 533,394 546,427

EQUITYParent Entity Interest

Contributed equity – ordinary shares 19 324,881 361,693 324,375 361,187Contributed equity – reset preference shares 19 147,195 147,205 147,195 147,205Reserves 20 (17,907) 6,414 545 545Retained profits 4 128,366 133,781 61,279 37,490

Total parent entity interest 36 582,535 649,093 533,394 546,427Outside equity interest in controlled entities 36 5,872 6,655 – –

Total Equity 588,407 655,748 533,394 546,427

The above Statements of Financial Position should be read in conjunction with the accompanying notes.


STATEMENTS OF CASH FLOWSFOR THE YEAR ENDED 30 JUNE 2003


$000s $000s $000s $000s

CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers 688,690 796,816 9,528 9,607Payments to suppliers and employees (578,874) (654,645) (13,211) (16,041)Dividends received 16 276 34,159 41,512Interest paid and other costs of finance (9,711) (11,222) (790) (8,286)Interest received 3,457 4,181 7,622 12,069Australian net GST (paid)/refunded (6,125) (7,976) 1,810 758Income taxes paid (21,274) (48,076) (851) (2,476)

Net operating cash flows 30(b) 76,179 79,354 38,267 37,143

CASH FLOWS FROM INVESTING ACTIVITIESPayments for purchase of controlled entities 30(c) (210) (12,496) (34,159) –Payments for purchase of businesses 30(d) (12,335) (17,945) – –Payments for investment in associated entities (17,603) – – –Payments for investment in subsidiaries – – – (99,776)Payments for investment in listed entities (8,579) (1,128) – (1,137)Payments for investment in unlisted entities (25) – – –Payments for property, plant and equipment (17,933) (56,886) (370) (492)Security deposit on premises – 1,200 – 1,200Loans granted to other entities – (290) – –Net loan repayments from/(grants to) controlled entities – – 63,282 57,877Loan repayments received – – – 1Proceeds from sale of property, plant and equipment 153 646 – 1Proceeds from sale of property, plant and equipment to related entity – – – 102Proceeds from sale of investments 372 8,520 – –

Net investing cash flows (56,160) (78,379) 28,753 (42,224)

CASH FLOWS FROM FINANCING ACTIVITIESProceeds from issues of ordinary shares 1,539 7,090 1,539 7,090Proceeds from issue of reset preference shares – 150,000 – 150,000Costs of issue of reset preference shares – (2,795) – (2,795)Buy-back of ordinary shares (38,351) – (38,351) –Proceeds from borrowings 227,015 57,265 – 19,295Repayment of borrowings (182,885) (176,000) – (158,000)Dividends paid – ordinary shares (27,279) (5,504) (27,279) (5,504)Dividends paid – reset preference shares (8,250) (4,204) (8,250) (4,204)Dividends paid to outside equity interest in controlled entity (524) – – –Proceeds from finance leases 759 – – –Repayment of finance leases (1,860) (1,816) (613) (756)Other – settlement of deferred acquisition – (12,597) – –

Net financing cash flows (29,836) 11,439 72,954 5,126

Net increase/(decrease) in cash held (9,817) 12,414 (5,934) 45Cash at the beginning of the financial year 30(a) 74,327 65,453 9,542 9,497Exchange rate variations on foreign cash balances (3,682) (3,540) – –

Cash at the end of the financial year 30(a) 60,828 74,327 3,608 9,542

Refer to Note 30(f) for information in respect of any non-cash financing and investing transactions.The above Statements of Cash Flows should be read in conjunction with the accompanying notes.


NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2003

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

Basis of accountingThe financial statements have been prepared as a general purpose financial report that complies with the requirements of theCorporations Act 2001, Australian Accounting Standards, other authoritative pronouncements of the Australian AccountingStandards Board and Urgent Issues Group Consensus Views. The accounting policies used are consistent with those adopted inthe previous year. The financial statements have also been prepared in accordance with the historical cost convention and do nottake account of changes in either the general purchasing power of the dollar or in the prices of specific assets except for certainassets that, where noted, are at valuation.

Comparative information has been reclassified or represented to maintain comparability with the current reporting period.

As a result of applying the new accounting standard AASB 1044 Provisions, Contingent Liabilities and Contingent Assets for thefirst time, certain liabilities have been reclassified as described in the final paragraph of Note 1.

Principles of consolidationThe consolidated financial statements include the financial statements of the parent entity, Computershare Limited, and itscontrolled entities, referred to collectively throughout these financial statements as the “consolidated entity”.

All inter-entity balances and transactions have been eliminated. Where an entity either began or ceased to be controlled during theyear, the results are included only from the date control commenced or up to the date control ceased.

Financial statements of foreign controlled entities presented in accordance with overseas accounting principles are, forconsolidation purposes, adjusted to comply with group policy and generally accepted accounting principles in Australia.

Foreign currency transactionsForeign currency transactions are converted to Australian dollars at exchange rates approximating those in effect at the date ofeach transaction. Amounts payable and receivable in foreign currencies at balance date are converted to Australian dollars at theaverage of the buy and sell rates available on the close of business at balance date. Revaluation gains and losses are brought toaccount as they occur. The financial statements of all foreign operations are translated using the current rate method as they areconsidered self-sustaining.

Exchange differences relating to monetary items are included in the Statements of Financial Performance, as exchange gains orlosses, in the period when the exchange rates change. Where the exchange difference relates to hedging part of the netinvestment in a self-sustaining foreign operation the exchange difference is transferred to the foreign currency translation reserveon consolidation.

Income taxThe financial statements apply the principles of tax-effect accounting. The income tax expense in the Statements of FinancialPerformance represents tax on the pre-tax accounting profit adjusted for income and expenses never to be assessed or allowed fortaxation purposes. The provision for deferred income tax liability and the future income tax benefit include the tax effect ofdifferences between income and expense items recognised in different accounting periods for book and tax purposes, calculated atthe tax rates expected to apply when the differences reverse.

The benefit arising from estimated carry forward tax losses is recorded as a future income tax benefit only where realisation ofsuch benefit is considered to be virtually certain. The benefit arising from timing differences is recorded as a future income taxbenefit where realisation of such benefit is beyond reasonable doubt.

No provision is made for withholding tax on unremitted earnings of applicable foreign incorporated controlled entities as there iscurrently no intention to remit these earnings to the parent entity.

Inventories

Inventories are valued at the lower of cost and net realisable value. Cost is assigned on a first-in first-out basis.

Prepaid inventory is recorded at cost and is bought on behalf of the company’s clients. As the inventory is used, the costs are billed.


Recoverable amount of non-current assetsAll non-current assets are reviewed at least annually to determine whether their carrying amounts require write-down to recoverableamount. Recoverable amounts for all non-current assets are determined using net cash flows that have not been discounted topresent values.

Property, plant and equipmentThe amounts at which property, plant and equipment are stated in these financial statements are regularly reviewed. Whererevaluations are made they are based on reports by independent valuers.

The gain or loss on disposal of revalued assets is calculated as the difference between the carrying amount of the asset at the timeof disposal and the proceeds on disposal and is included in the profit and loss of the consolidated entity in the year of disposal.Any related revaluation increment in the asset revaluation reserve at the time of disposal is transferred to retained earnings.

DepreciationItems of property, plant and equipment, excluding freehold land and leasehold plant and equipment, are depreciated on a straightline basis at rates calculated to allocate their cost or valuation, less estimated residual value, against revenue over their estimateduseful life. Additions and disposals are depreciated for the period held in the year of acquisition or disposal. Depreciation expensehas been determined based on the following rates of depreciation - Buildings (2.5% per annum), Plant and Equipment (10% to 50%per annum), Fixtures and Fittings (13% to 50% per annum) and Motor Vehicles (15% to 40% per annum).

Investments

Controlled entitiesThe investments in the controlled entities are carried in the company's financial statements at the lower of cost and recoverableamount. Dividends from controlled entities are brought to account in the Statements of Financial Performance when they areproposed by the controlled entities.

Associated entitiesInterests in material associated entities are brought to account using the equity method. Under this method the investment inassociates is initially recognised at its cost of acquisition and its carrying value is subsequently adjusted for increases or decreasesin the investor’s share of post-acquisition results and reserves of the associate. The investment in associated entities is decreasedby the amount of dividends received or receivable. Investments in associates are carried at the lower of cost and recoverableamount in the accounts of the parent entity.

Detailed equity accounting information concerning the consolidated entity’s interests in material associated entities is provide inNote 34.

Other financial assetsBroker client deposits and all other investments are carried in the accounts at the lower of cost or recoverable amount. Dividendand interest income from these assets is brought to account when received.

LeasesAssets acquired under finance leases are capitalised and amortised over the life of the relevant lease, or where ownership is likelyto be obtained on expiration of the lease, over the life of the asset. Lease payments are allocated between interest expense andreduction in the lease liability.

Operating lease assets are not capitalised and rental payments are charged against operating profit in the period in which theyare incurred.

Software development costsInternally developed software and related costs are expensed in the year in which they are incurred.


NOTES TO THE FINANCIAL STATEMENTS (continued)FOR THE YEAR ENDED 30 JUNE 2003

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Acquisition of assetsThe purchase method of accounting is used for all acquisitions of assets regardless of whether equity instruments or other assetsare acquired. Cost is measured as the fair value of the assets given up, shares issued or liabilities undertaken at the date of theacquisition. Where equity instruments are issued in an acquisition, the value of the instruments is their market price as atacquisition date, unless the notional price at which they could be placed in the market is a better indicator of fair value. Transactioncosts arising on the issue of equity instruments are recognised directly in equity.

Provisions for restructuring costs and related employee termination benefits are recognised as at the date of acquisition of an entityor part thereof on the basis described in the accounting policy notes for restructuring costs and employee benefits. Goodwill isbrought to account as described in the accounting policy note for goodwill.

GoodwillOn acquisition of a controlled entity, the difference between the purchase consideration plus incidental expenses and the fair valueof identifiable net assets acquired is initially brought to account as goodwill or discount on acquisition.

In establishing the fair value of the identifiable net assets acquired, a liability for restructuring costs is only recognised at the date ofacquisition where there is a demonstrable commitment and a detailed plan. The liability is only recognised where there is little or nodiscretion to avoid payments to other parties in settlement of costs of the restructuring and a reliable estimate of the amount of theliability as at the date of acquisition can be made.

Revisions in the estimated amount of restructuring costs which are recognised as a liability as at the date of acquisition areaccounted for by adjusting the amount of the liability and the amount of goodwill. These adjustments are made in the reportingperiod in which the revision in the estimate occurs. Consequential adjustments to reflect the cumulative effect of revisions on theamount of amortisation of goodwill are recognised in the Statements of Financial Performance in the reporting period in which therevision in estimate occurs.

Purchased goodwill is amortised on a straight line basis over the period during which the benefits are expected to arise. Theseperiods have been individually assessed on an entity by entity basis and vary between 5 to 20 years from the date of gainingcontrol. The unamortised balance of goodwill is reviewed at each balance date and charged to profit and loss to the extent thatapplicable future benefits are no longer probable.

Restructuring costs

Liabilities arising directly from undertaking a restructuring program, not in connection with the acquisition of an entity or operations,are recognised when a detailed plan of the restructuring activity has been developed and implementation of the restructuringprogram as planned has commenced, by either entering into contracts to undertake the restructuring activities or making a detailedannouncement such that affected parties are in no doubt the restructuring program will proceed.

Liabilities for the cost of restructuring entities or operations acquired are recognised as at the date of acquisition of an entity oroperations, or part thereof, if the main features of the restructuring were planned and there was a demonstrable commitment tothe restructuring at the acquisition date, and this is supported by detailed plan developed within three months of the acquisition, orprior to the completion of the financial report, if earlier.

Liabilities for employee termination benefits associated with restructuring relating to an acquisition are brought to account on thebasis described in the accounting policy note for employee benefits. Liabilities for costs of restructurings and related employeetermination benefits are disclosed in aggregate where the restructuring occurs as a consequence of an acquisition.

Reversals of part or all of a provision for restructuring relating to an acquisition because the costs are no longer expected to beincurred as planned, are adjusted against the goodwill or discount on acquisition. The adjusted carrying amounts of goodwill ornon-monetary assets are amortised or depreciated from the date of the reversal.


Employee entitlementsProvision has been made in the Statements of Financial Position for benefits accruing to employees in relation to annual leave, longservice leave, workers compensation and vested sick leave. No provision is made for non-vesting sick leave as the anticipatedpattern of future sick leave taken indicates that accumulated non-vesting sick leave will never be paid.

All on-costs, including payroll tax, workers’ compensation premiums and fringe benefits tax are included in the determination ofprovisions. Vested sick leave, annual leave and the current portion of long service leave are measured at their nominal amounts.

The non-current portion of the long service leave provision is measured at the present value of estimated future cash flows,discounted by the interest rate applicable to Commonwealth Government securities maturing in the period the liability is expectedto fall due. A 4% per annum rate of increase in employee wage and salary rates was assumed in the present value calculations.

Retirement benefitsContributory superannuation and pension plans exist to provide benefits for the consolidated entity’s employees and theirdependants on retirement, disability or death. The plans are accumulation plans. The employee sponsors contribute to the plans atvarying rates of contribution depending on the employee classification. The contributions made to the funds by group entities arecharged against profits (refer Note 23(a)).

Employee share and option ownership schemesCertain employees are entitled to participate in share and option ownership schemes. The details of schemes are described inNote 21 (a). No remuneration expense is recognised in respect of employee shares and options issued.

Termination benefitsLiabilities for termination benefits, not in connection with the acquisition of an entity or operation are recognised when a detailedplan for the terminations has been developed and a valid expectation has been raised in those employees affected that theterminations will be carried out. The liabilities for termination benefits are recognised in other creditors unless the amount ortiming of the payments is uncertain, in which case they are recognised as provisions.

Liabilities for termination benefits relating to an acquired entity or operation that arise as a consequence of acquisition arerecognised as at the date of acquisition if, at or before the acquisition date, the main features of the terminations were planned anda valid expectation had been raised in those employees affected that the terminations would be carried out and this is supported bya detailed plan developed within three months of the acquisition, or prior to the completion of the financial report, if earlier. Theseliabilities are disclosed in aggregate with other restructuring costs as a consequence of the acquisition.

Operating revenue

Sales RevenueSales revenue comprises registry and bureau revenue, sale of software licences and associated development, installation andmaintenance fees (net of returns, discounts and allowances) and document processing services.

Registry and bureau revenue includes all revenue earned on the provision of regular services to customers, primarily fixed monthlymaintenance fees and transaction processing fees. Additionally, sales revenue includes all associated revenue earned frommanaging various client corporate actions, such as capital raisings, demutualisations and takeovers, which occur periodically.Revenue derived from both sources of sales revenue includes variable margin income earned on administered funds, includingSave As You Earn Schemes (refer Note 29(a)).

In relation to the recognition of any profits and losses on the corporate actions which span reporting periods, where they can bereliably measured, revenue and expenses arising from the project are recognised in the Statements of Financial Performance byreference to the stage of completion of the project as at balance date.

Software licence sales and associated development, installation and maintenance fees are recognised in accordance with writtencustomer agreements so as to match revenue with expenses.

Document processing revenues include revenue from the provision of paper and electronic document needs for issuers, investorsand many corporations. This includes design, document composition and programming, through to various production anddistribution methods.



1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Other RevenueOther revenue includes interest income on short-term deposits controlled by the consolidated entity, royalties and dividendsreceived from other persons.

Insurance recoveriesThe consolidated entity recognises amounts receivable under its insurance policies, net of any relevant excess amounts, uponindemnity being acknowledged by the insurers.

Financial instruments included in equityOrdinary share capital bears no special terms or conditions affecting income or capital entitlements of the shareholders.

Reset preference shares earn a preferential non-cumulative dividend fixed for the first five years of 5.5% per annum. Further detailsof terms and conditions of preference shares are detailed in Note 19(a) to the financial statements.

Financial instruments included in liabilitiesLoans are recognised when issued at the amount of the net proceeds received, with any premium or discount on issue amortisedover the period to maturity. Interest is recognised as an expense on an effective yield basis.

Financial instruments included in assets

Trade debtorsTrade debtors are initially recorded at the amount of the contracted sale proceeds.

Provision for doubtful debts is recognised to the extent that recovery of the outstanding receivable balance is considered less thanlikely. Any provision established is based on a review of all outstanding amounts at balance date.

Forward exchange contracts

Forward currency exchange contracts are initially recognised as either an asset or liability, at an amount equal to the premium ordiscount on the forward currency exchange contracts. The assets and liabilities recognised are subsequently remeasured byreference to exchange rates at balance date. The gain or loss on remeasurement is brought to account in the Statements ofFinancial Performance unless the contracts are entered to hedge anticipated specific future transactions, in which case the gain orloss is deferred and included in the initial measurement of the anticipated item being hedged.

The premium or discount on the forward currency exchange contracts is amortised over the period of the contracts, unless thecontracts are entered to hedge anticipated specific future transactions, in which case the premium or discount is included in theinitial measurement of anticipated items being hedged.

Bank deposits and loansBank deposits and loans are carried at cost. Interest revenue is recognised on an effective yield basis.

Other investmentsOther investments, including equity interests in non-subsidiary, non-associated corporations are included in investments at thelower of cost or recoverable amount. Dividend income is brought to account when received.

Hedge accountingThe consolidated entity applies the principles of hedge accounting as set out in the relevant Australian Accounting Standards andUIG pronouncements, using both interest rate and foreign currency swaps and options. To the extent that hedging instruments arerequired to be marked to market and become ineffective as a hedge of the intended risk all gains and losses are recognisedimmediately in the Statements of Financial Performance.


CashFor the purposes of the Statements of Cash Flows, cash includes deposits at call with financial institutions and other highly liquidinvestments with short periods to maturity which are readily convertible to cash on hand and are subject to an insignificant risk ofchanges in value, net of outstanding bank overdrafts. Cash excludes Broker Client Deposits carried on the Statements of FinancialPerformance that are recorded as other current financial assets.

Change in accounting standardsThe new Australian accounting standard AASB 1044 “Provisions, Contingent Liabilities and Contingent Assets” is applicable to theGroup for the first time, effective 1 July 2002. This requires that provision is only made for the amount of any dividend declared,determined or publicly recommended by the directors on or before the end of the year, but not distributed at balance date.

In previous periods, in addition to providing for the amount of any dividends declared, determined or publicly recommended by thedirectors on or before the end of the financial year but not distributed at balance date, provision was made for dividends to be paidout of retained profits at the end of the financial year where the dividend was proposed, recommended or declared between theend of the financial year and the completion of the financial report.

An adjustment of $13,856,959 was made against the consolidated and parent entity retained profits at the beginning of the financialyear to reverse the amount provided at 30 June 2002 for the proposed final dividend for that year that was recommended by thedirectors between the end of the financial year and the completion of the financial report. This reduced the consolidated andparent entity current liabilities - provisions and total liabilities at the beginning of the financial year by $13,856,959 withcorresponding increases in their net assets, retained profits, total equity and the total dividends provided for or paid during thecurrent financial year.

The restatements of consolidated and parent entity retained profits, provisions and total dividends provided for or paid during theyear set out below show the information that would have been disclosed had the new accounting policy always been applied.

Consolidated Parent entity2003 2002 2003 2002

$000s $000s $000s $000s(Restated) (Restated) (Restated) (Restated)

Restatement of retained profitsPreviously reported retained profits at the end of the previous financial year (Note 4) 133,781 83,993 37,490 439Change in accounting policy for providing for dividends 13,857 2,738 13,857 2,738

Restated retained profits at the beginning of the financial year 147,638 86,731 51,347 3,177Net profit attributable to members of the parent entity 16,256 71,293 45,460 58,556

Total available for appropriation 163,894 158,024 96,807 61,733Ordinary dividends provided for or paid (Note 4) (27,278) (5,504) (27,278) (5,504)Reset Preference dividends provided for or paid (Note 4) (8,250) (4,882) (8,250) (4,882)

Restated retained profits at the end of the financial year (Note 4) 128,366 147,638 61,279 51,347

The liabilities for annual leave expected to be settled within 12 months of reporting date have been reclassified from provisions toother creditors in the current year as a result of the adoption of the new accounting standard AASB 1044 Provisions, ContingentLiabilities and Contingent Assets. The directors do not believe that there are any significant uncertainties relating to the amount andtiming of future payments included in these employee benefits, therefore they do not meet the definition of a provision under thenew standard. Comparative amounts have also been reclassified to ensure comparability with the current reporting period.




$000s $000s $000s $000s

2. OPERATING PROFIT

a) Profit from ordinary activities is after crediting the following revenues:

Sales revenueRendering of services 694,519 757,055 – –

Other revenueNet foreign exchange gains (refer also to borrowing costs) 264 802 6,546 1,169 Decrease in underwriting liability to controlled entity following novation of financial instruments – – 8,044 16,914Gain on other financial instruments 509 1,406 27 1,070Amortisation of discount on forward exchange contracts 2,318 1,485 – –Dividends received from:– other persons 16 278 – – – controlled entity – – 34,159 41,512Interest received from:– other persons 3,584 4,161 148 456– controlled entities – – 6,739 13,189Rent received and sub-lease rentals 3,940 1,947 – –Other fees received from controlled entities – – 9,366 10,258Gross proceeds from the sale of: – Property, plant and equipment 153 646 – –– Investments 372 8,520 – –– Non-current assets to controlled entities – – 32 102Other revenue items in total 2,922 4,666 24 65

Total other revenues 14,078 23,911 65,085 84,735

Total revenue from ordinary activities (excluding share of net profits of associates accounted for using the equity method) 708,597 780,966 65,085 84,735

Profit from ordinary activities is after charging the following expenses:

Depreciation and amortisationDepreciation of property, plant and equipment 24,894 21,951 453 406 Amortisation of:– Leased assets 1,193 1,115 514 618 – Leasehold improvements 2,905 2,006 16 16– Establishment costs 135 67 – –– Currency options – 37 – 37– Employee shares 347 85 223 74– Goodwill 31,263 29,869 – –

Total depreciation and amortisation 60,737 55,130 1,206 1,151

Borrowing costsInterest paid:– to other persons 6,921 8,798 – 6,456– on finance leases 211 344 65 109– to controlled entities – – 705 315Exchange (gain)/loss on foreign currency loans – – – (853)Loan facility fees 1,164 1,027 160 732

Total borrowing costs 8,296 10,169 930 6,759



$000s $000s $000s $000s

Other operating expense itemsOperating lease rentals (a) 33,229 27,973 2,897 2,897Technology spending-research and development 92,100 106,700 – –Provision for employee entitlements 303 3,212 (41) 330Net charge to/(reduction in) provision for doubtful trade debts 518 (242) – (604)(Profit)/loss on disposal of investments (8) (1,889) – –Expense from sale of:– Plant and equipment 572 641 – –– Plant and equipment to controlled entity – – 32 102– Investments 364 6,631 – –(Profit)/ loss on sale of property, plant and equipment 419 (5) – –

(a) Operating lease rentals includes contingent rentals of approximately $786,589 (2002: $786,590)

(b) Individually Significant Items

ExpensesDuring the year, there has been significant restructuring of the company's global businesses. The impact on expenses is $35.1 million of non-recurring costs, comprising $23.2 million in redundancies, $7.5 million in property write-offs, $3.0 million in restructuring costs and $1.4 million in asset write-offs.

Outside equity interestOn 1 June 2002 Computershare Group sold 7.32% of its interest in Computershare Hong Kong Investor Services Limited (“CHIS”).

In addition CHIS issued shares to a subsidiary of the Hong Kong Securities Clearing Company Limited (“MPL”) equivalent to 18% of the expanded CHIS share capital. These shares were issued in consideration for MPL transferring its interest in its Hong Kongregistry operations to CHIS. As part of the above transactions, the terms and conditions of the shares held by the ComputershareGroup in CHIS were changed to provide a preferential right to the extent of the retained profits in CHIS as at the transaction date. In accordance with AASB 1024 Consolidated Accounts, the movement in the parent entity’s share of net assets of CHIS (arising asa consequence of the issue of new shares in CHIS) has been recorded in the Statements of Financial Performance as a loss of$13,540,000 to the outside equity interest.




$000s $000s $000s $000s

3. INCOME TAXThe income tax expense for the financial year differs from the amount calculated on the profit. The differences are reconciled as follows:

Operating profit/(loss) 29,462 83,748 50,076 61,379

Prima facie income tax expense/(benefit) thereon at 30% 8,839 25,125 15,023 18,414Tax effect of permanent differences:– Amortisation of goodwill not deductible 5,418 4,666 – –– Research and development allowance (1,692) (1,548) – –– Non-deductible provisions 194 1,006 – –– Benefit of tax losses not brought to account 6,230 23 – –– Rebatable dividends – – (10,247) (12,454)– Other (2,440) (243) (118) (206)Prior year tax (over)/under provided (1,971) (2,086) (42) (2,931)Restatement of deferred tax balances due to income tax rate changes (404) (572) – –Effect of different tax rates on overseas income (1,845) (376) – –

Income tax expense/(benefit) on operating profit/(loss) 12,329 25,995 4,616 2,823

As at 30 June 2003, companies within the consolidated entity had estimated unconfirmed gross income tax losses of $18,038,000(2002: $4,556,000) available to offset against future years’ taxable income. The benefit of these losses has not been brought toaccount as realisation is not virtually certain. The benefit for these tax losses will only be obtained if:

(a) the companies derive future assessable income of a nature and of an amount sufficient to enable the benefits from thedeductions for the losses to be realised;

(b) the companies continue to comply with the conditions for deductibility imposed by tax legislation; and

(c) no changes in the taxation legislation adversely affect the companies in realising the benefit from the deductions for thelosses.

Tax consolidation legislationComputershare Ltd and its wholly-owned Australian entities intend to implement the tax consolidation legislation as of 1 July 2003. TheAustralian Taxation Office has not yet been formally notified of this decision.

The entities have also entered into a tax sharing agreement. As a consequence, Computershare Limited, as the head entity in thetax consolidation group, has recognised the current tax liability relating to transactions, events and balances of the wholly ownedAustralian controlled entities in this group in the financial statements as if those liabilities were its own, in addition to recognisingthe current tax liability arising in relation to its own transactions, events and balances. Amounts receivable or payable under the taxsharing agreement are recognised separately as tax related payables or receivables. The impact on the income tax expense andresults of Computershare Limited is unlikely to be material because of the tax sharing agreement. Expenses and revenues arisingunder the tax sharing agreement are recognised as a component of income tax expense. The tax sharing agreement is notexpected to have a material impact on the consolidated assets, liabilities and results.



$000s $000s $000s $000s

4. RETAINED PROFITS AND DIVIDENDS

Retained profitsRetained profits at the beginning of the financial year 133,781 83,993 37,490 439Adjustment resulting from change in accounting policy for providing for dividends 13,857 – 13,857 –Ordinary dividends provided for or paid (27,278) (16,623) (27,278) (16,623)Reset preference dividends provided for or paid (8,250) (4,882) (8,250) (4,882)Net profit /(loss) attributable to members of Computershare Limited 16,256 71,293 45,460 58,556

Retained profits at the end of the financial year 128,366 133,781 61,279 37,490

EquityTotal equity at the beginning of the financial year 655,748 472,902 546,427 355,081Adjustment resulting from change in accounting policy for providing for dividends 13,857 – 13,857 –Total changes in equity recognised in the Statements of Financial Performance (8,065) 46,928 45,460 58,556Transactions with owners as owners:

Contributed equity – ordinary shares, net of Buy-backs (36,812) 7,090 (36,812) 7,090Contributed equity – reset preference shares, net of costs of issue (10) 147,205 (10) 147,205Dividends – ordinary shares (27,278) (16,623) (27,278) (16,623)Dividends – reset preference shares (8,250) (4,882) (8,250) (4,882)

Total changes in outside equity interests (783) 3,128 – –

Total equity at the reporting date 588,407 655,748 533,394 546,427

DividendsOrdinaryDividends paid during the financial year inrespect of the previous year – fully franked at 30% 13,861 2,746 13,861 2,746Dividends paid and proposed in respect ofthe current financial year – fully franked at 30% 13,421 16,623 13,421 16,623

Reset PreferenceDividends paid during the financial year inrespect of the previous year – fully franked at 30% 4,137 – 4,137 –Dividends paid and proposed in respect of the current financial year – fully franked at 30% 8,250 4,882 8,250 4,882

For details of dividend entitlements on reset preference shares refer to Note 19(a)

Franked dividendsThe final franked dividends proposed in respect ofthe year ended 30 June 2003 will be franked out of existing franking credits.

Dividend franking accountFranking credits available for subsequent financial years based on a tax rate of 30% 43,265 38,667 43,265 25,700

The above amounts represent the balance of the franking account as at the end of the financial year adjusted for:

(a) franking credits that will arise from the payment of current tax liability(b) franking debits that will arise from the payment of dividends recognised as a liability at the reporting date(c) franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date(d) franking credits that may be prevented from being distributed in subsequent financial years.

Under legislation that took effect on 1 July 2002, the amount recorded in the franking account is the amount of Australian incometax paid, rather than franking credits based on after tax profits, and amounts debited to that account in respect of dividends paidafter 30 June 2002 are the franking credits attaching to those dividends rather than the gross amount of the dividends. Inaccordance with this legislation, the franking credits available at 30 June 2002 for the consolidated entity and parent entity of$90,223,000 and $59,966,000 respectively based on after tax profits, were converted so that the opening balances on 1 July 2002reflected tax paid amounts of $38,667,000 and $25,700,000 which are shown as comparative amounts above.



Calculation of Calculation of Calculation of Calculation ofBasic EPS Diluted EPS Normalised Normalised

Basic EPS Diluted EPS$000s $000s $000s $000s

5. EARNINGS PER SHARE

Year end 30 June 2003Earnings per share (cents per share) 1.47 cents 2.60 cents 6.05 cents 6.57 centsNet profit 17,133 17,133 17,133 17,133Outside equity interest (profit)/loss (877) (877) (877) (877)Exclusions of normalising equity transactions, net of tax (refer Note 2(b)):• Redundancies – – 16,234 16,234• Property write-offs – – 4,980 4,980• Asset write-offs – – 1,092 1,092• Restructuring costs – – 2,586 2,586Dividends on reset preference shares (8,250) – (8,250) –

Net profit 8,006 16,256 32,898 41,148

Weighted average number of ordinary shares used as denominator in calculating basic earnings per share 544,130,199 544,130,199

Weighted average number of ordinary and potential ordinary sharesused as denominator in calculating diluted earnings per share 626,076,728 626,076,728

Allotment, conversion to or subscription for ordinary shares between reporting date and time of completion of this report Refer Note 19 Refer Note 19

Issue of potential ordinary shares between reporting date and time of completion of this report Refer Note 19 Refer Note 19

Employee options on issue that are not dilutive and therefore not included in the calculation of diluted EPS are shown in the table of employee options in Note 19 and marked with (B)

Year end 30 June 2002Earnings per share (cents per share) 12.0 cents 12.2 cents 9.6 cents 9.9 centsNet profit 57,753 57,753 57,753 57,753Outside equity interest (profit)/loss 13,540 13,540 13,540 13,540Exclusion of Hong Kong equity transaction (refer Note 2(b)) – – (13,362) (13,362)Dividends on reset preference shares (4,882) – (4,882) –

Net profit 66,411 71,293 53,049 57,931

Weighted average number of ordinary shares used as denominator in calculating basic earnings per share 551,615,920 551,615,920

Weighted average number of ordinary and potential ordinary shares used as denominator in calculating diluted earnings per share 582,348,267 582,348,267

Allotment, conversion to or subscription for ordinary shares between reporting date and time of completion of this report: 172,000 options 172,000 options

exercised as per exercised as perNote 19 to 2002 Note 19 to 2002Financial Report Financial Report

Issue of potential ordinary shares between reporting date and time of completion of this report None NoneEmployee options on issue that are not dilutive and therefore not included in the calculation of diluted EPS are shown in the table of employee options in Note 19 and marked with (A)


Consolidated Parent entityNotes 2003 2002 2003 2002

$000s $000s $000s $000s

6. RECEIVABLES

CurrentTrade debtors 99,734 104,916 – 4Trade debtors – controlled entities – – 1,285 1,423Tax related receivables – controlled entities – – 2,979 –

Total trade debtors 99,734 104,916 4,264 1,427

Less: Provision for doubtful debts (4,608) (4,090) – –

Trade debtors, net 95,126 100,826 4,264 1,427Accrued revenue 32,445 36,112 – –Other non-trade amounts 2,676 10,907 376 1,538Interest receivable 1,973 2,365 497 –

132,220 150,210 5,137 2,965

Non-CurrentNon-trade amounts owing by controlled entities – – 244,551 348,116Non-trade amounts owing by associated entities – 1,977 – –Less: Provision for doubtful debts – (1,977) – –Foreign tax credits 1,049 595 1,049 193

1,049 595 245,600 348,309

7. OTHER FINANCIAL ASSETS

CurrentBroker client deposits (a) (refer Note 14) 35,987 41,517 – –Unlisted shares in unrelated entities 666 9 – –

36,653 41,526 – –

(a) An overseas entity is a licensed deposit taker. As at yearend this controlled entity has accepted deposits in its own name, and recorded these funds as other financial assets together with a corresponding liability. The deposits are insured through a local regulatory authority.

Non-CurrentInvestments:Shares in listed companies (a) 14,453 6,878 6,785 6,785Unlisted shares in unrelated entities, at cost 633 665 – –Unlisted shares in controlled entities, at cost – – 338,917 304,766

15,086 7,543 345,702 311,551

(a) Market value of shares in unrelated listed companies 13,027 5,960 4,754 5,867

Included in the amount above is an 11% investment in E*Trade (“ETR”), which operates an internet brokerage business. Shares in ETR were written down at 30 June 2001. No further adjustment has been made to the carrying value of shares in listed companies during the year end 30 June 2003 as directors believe there has been no further permanent diminution in value.

8. INVENTORIESRaw materials and stores, at cost 3,323 3,355 – –Work in progress, at cost 581 – – –

3,904 3,355 – –




$000s $000s $000s $000s

9. OTHER

CurrentPrepayments 11,152 11,092 396 862

11,152 11,092 396 862

10. PROPERTY, PLANT AND EQUIPMENT

Land - at cost (a)

Opening balance 12,756 13,105 900 900Currency translation differences (972) (349) – –

Closing balance 11,784 12,756 900 900

Buildings, freehold - at cost (a)

Opening balance 53,982 45,088 2,200 2,200Additions 863 10,703 – –Currency translation differences (4,320) (1,809) – –

Closing balance 50,525 53,982 2,200 2,200

Buildings, leasehold - at cost (a)

Opening balance 6,472 861 – –Additions 370 5,635 – –Currency translation differences (527) (24) – –

Closing balance 6,315 6,472 – –

Accumulated depreciationOpening balance 5,835 4,152 580 492Depreciation for the year 2,325 1,726 88 88Currency translation differences (625) (43) – –

Closing balance 7,535 5,835 668 580

Net book value of land and buildings 61,089 67,375 2,432 2,520

Plant and Equipment - at costOpening balance 98,621 78,168 675 191Additions 12,189 21,792 332 484Acquisitions through subsidiaries and businesses acquired 7,404 3,409 – –Disposals (3,031) (1,532) – –Transfers (869) – – –Currency translation differences (4,249) (3,216) – –

Closing balance 110,065 98,621 1,007 675

Accumulated depreciationOpening balance 57,801 43,314 283 127Depreciation for the year 18,702 16,517 218 156Disposals (2,318) (1,076) – –Transfers (700) – – –Currency translation differences (2,902) (954) – –

Closing balance 70,583 57,801 501 283

Net book value of plant and equipment 39,482 40,820 506 392



$000s $000s $000s $000s

Fixtures and fittings - at cost Opening balance 25,534 21,283 1,340 1,333Additions 972 6,870 9 8Acquisitions through subsidiaries and businesses acquired – 525 – –Disposals (618) (1,591) – (1)Transfer (672) – – –Currency translation differences (1,260) (1,553) – –

Closing balance 23,956 25,534 1,349 1,340

Accumulated depreciationOpening balance 8,263 6,563 734 577Depreciation for the year 3,789 3,638 144 158Disposals (382) (1,422) – (1)Transfer (265) – – –Currency translation differences (666) (516) – –

Closing balance 10,739 8,263 878 734

Net book value of fixtures and fittings 13,217 17,271 471 606

Motor vehicles – at costOpening balance 679 569 46 46Additions 36 163 29 –Acquisitions through subsidiaries and businesses acquired – 30 – –Disposals – (45) – –Currency translation differences (49) (38) – –

Closing balance 666 679 75 46

Accumulated depreciationOpening balance 425 412 41 36Depreciation for the year 78 70 3 5Disposals – (29) – –Currency translation differences (43) (28) – –


Net book value of motor vehicles 206 254 31 5

Leased plant and equipment - at costOpening balance 7,245 5,965 3,025 4,046Additions 759 2,380 – –Disposals – – (32) (102)Transfers 1,541 – – –Transfer to owned assets on expiry of lease (287) (1,020) (287) (919)Currency translation differences (290) (80) – –

Closing balance 8.968 7,245 2,706 3,025

Accumulated amortisationOpening balance 3,445 3,250 1,852 2,153Amortisation for the year 1,193 1,115 513 617 Transfers 965 – – –Transfer to owned assets on expiry of lease (287) (918) (287) (918)Currency translation differences (49) (2) – –

Closing balance 5,267 3,445 2,078 1,852

Net book value of leased plant and equipment 3,701 3,800 628 1,173




$000s $000s $000s $000s

10. PROPERTY, PLANT AND EQUIPMENT (continued)

Leasehold improvements - at cost Opening balance 21,208 13,636 105 105Additions 2,743 9,343 – –Disposals (401) – – –Currency translation differences (1,978) (1,771) – –

Closing balance 21,572 21,208 105 105

Accumulated amortisationOpening balance 3,770 2,106 63 47Amortisation for the year 2,905 2,006 16 16 Disposals (209) – – –Currency translation differences (818) (342) – –

Closing balance 5,648 3,770 79 63

Net book value of leasehold improvements 15,924 17,438 26 42

Total property, plant and equipment 133,619 146,958 4,094 4,738

(a) The directors consider that on an existing use basis at 30 June 2003 the current market value of land and buildings is not materially different, in the contextof the financial statements, to the cost as presented above.

11. TAX ASSETSCurrentRefunds receivable 941 1,731 – –

941 1,731 – –

Non-currentFuture income tax benefit– Attributable to carry forward tax losses 13,854 13,208 – –– Attributable to timing differences 33,321 26,596 10,579 5,181

47,175 39,804 10,579 5,181

12. INTANGIBLES – GOODWILLGoodwill - at cost 532,359 558,196 – –Less: Accumulated amortisation (100,857) (78,735) – –

431,502 479,461 – –

13. OTHEROther (including Pension asset – Hong Kong) 4,432 3,114 144 285

4,432 3,114 144 285



$000s $000s $000s $000s

14. PAYABLES

CurrentTrade creditors – unsecured 5,711 14,169 131 401 Trade creditors – intercompany – – 2,048 1,410Tax related payable – intercompany – – 3,369 –Deferred discount on forward exchange contracts, net of amortisation – 519 – –GST/VAT payable 5,434 7,386 – –Employee entitlements (refer Note 21) 9,152 9,146 410 517Underwriting liability to controlled entity following novation of financial instruments – – – 8,044Forward exchange hedge contract payables (Note 29) – 8,044 – – Other loans – unsecured, non-interest bearing 1,000 1,000 1,000 1,000 Broker client deposits (refer Note 7) 35,987 41,517 – –Other creditors and accruals 53,760 52,661 781 235

111,044 134,442 7,739 11,607

15. INTEREST BEARING LIABILITIES

CurrentBank loans (c) 2,747 2,472 – –Loans from controlled entities – unsecured – – – 381Lease Liability – secured (Note 23(b)), (b) 2,817 3,503 598 613

5,564 5,975 598 994

Non-CurrentBank loans (c) 2,357 4,338 – –Revolving multi-currency facility (a) 129,793 97,207 – – Loans from controlled entities – unsecured – – 62,678 108,396Lease liability – secured (Note 23(b)), (b) 773 1,279 – 598

132,923 102,824 62,678 108,994

(a) The consolidated entity maintains two revolving multi-currency facilities. The first revolving multi-currency facility is $120,000,000 and terminates on 30 June2005. This facility was drawn down to Australian dollar equivalent of $83,985,938 at 30 June 2003. The second revolving multi-currency facility is$120,000,000 and terminates on 3 July 2006. This facility was drawn down to Australian dollar equivalent of $45,806,654 at 30 June 2003. These facilitiesare subject to negative pledge agreements which impose certain covenants upon the consolidated entity.

(b) The lease liability is secured directly against the assets to which the leases relate.(c) Bank loans of $5,103,703 (Rand 25,481,258) are drawn under a facility which terminates on 31 March 2005. The facility is secured by guarantee given by

Computershare Services (SA) (Pty) Ltd, Computershare Custodial Services Ltd, Computershare Plan Managers (Pty) Ltd (South Africa) and CTS OutsourcingLtd (previously Computershare Outsourcing Ltd). Repayments are Rand 4,236,000 quarterly, commencing 1 July 2002.


$000s $000s $000s $000s

16. TAX LIABILITIES

CurrentProvision for income tax 5,876 12,439 9,769 114

5,876 12,439 9,769 114

Non-CurrentProvision for deferred income tax on timing differences 15,568 17,206 114 538

15,568 17,206 114 538




$000s $000s $000s $000s

17. PROVISIONS

CurrentDividend – ordinary shares – 13,857 – 13,857 Dividend – reset preference shares 678 678 678 678Restructuring (a) 11,814 2,107 – –Loss on early termination of lease 3,237 – – –Future services 3,253 2,696 – –Other 5,305 3,698 – –

24,287 23,036 678 14,535

Movement in provisionsMovements in each class of current provision during the financial year, other than employee benefits, are set out below.

Dividend – Dividend – Reset Loss on early FutureOrdinary shares preference shares Restructuring termination of lease services Other

Consolidated – 2003Carrying amount at start of year 13,857 678 2,107 – 2,696 3,698Additional provisions recognised – 8,250 13,159 3,237 1,309 1,854Payments/other sacrifices of economic benefits – (8,250) (2,869) – (538) (606)Adjustment for change in accounting standard refer Note 1 (13,857) – – – – –Reversals – – (484) – – –

Exchange rate impacts on opening balance – – (99) – (214) 359

Carrying amount at end of year – 678 11,814 3,237 3,253 5,305

Parent entity – 2003Carrying amount at start of year 13,857 678 – – – –Adjustment for change in accounting standard refer Note 1 (13,857) – – – – –Additional provisions recognised – 8,250 – – – –Payments/other sacrifices of economic benefits – (8,250) – – – –

Carrying amount at end of year – 678 – – – –

(a) The restructuring provision at 2003 relates to provision for costs associated with the restructuring of the company’s global businesses, including Canada,United Kingdom and South Africa.


$000s $000s $000s $000s

Non-CurrentEmployee entitlements (refer Note 21) 5,177 4,685 290 224

5,177 4,685 290 224



$000s $000s $000s $000s

18. OTHER LIABILITIES

CurrentDeferred settlement on acquisition of entity 2,569 566 – –

2,569 566 – –

Non-CurrentLease inducements (a) 2,991 2,795 – –

2,991 2,795 – –

(a) Lease inducements represent cash payments received as an allowance for leasehold improvements made to the premises. This receipt is being accounted for as a reduction in the rental expenses over the term of the lease.

19. CONTRIBUTED EQUITYOrdinary shares (b) 324,881 361,693 324,375 361,187Reset preference shares (a) 147,195 147,205 147,195 147,205

Total contributed equity (b) 472,076 508,898 471,570 508,392

(a) Reset preference shares represent 1,500,000 (2002: 1,500,000) fully paid shares of $100. 750,000 reset preference shares were offered during November 2001pursuant to an institutional placement. A further 750,000 reset preference shares were offered to the public pursuant to a prospectus dated 15 November 2001. The shares earn a preferential non-cumulative dividend fixed for the first five years of 5.5% per annum payable semi-annually in arrears, usually on 31 Mayand 30 November. The first dividend was paid on 31 May 2002. The dividend may be increased or decreased on reset dates. Payment of dividends is at the discretion of directors and is subject to there being sufficientprofits of Computershare out of which Computershare is lawfully able to pay dividends. The dividend rate assumes full franking. If a dividend is unfranked orpartially franked, the dividend will be increased to compensate for the unfranked amount. If there is a change in the corporate tax rate, the dividend will beadjusted to reflect this.Certain terms including the dividend rate, conversion terms and conversion discount may be reset on each reset date. The first reset date will be 30November 2006. On reset dates the outstanding preference shares may be converted into ordinary shares at the option of holders or Computershare. Incertain circumstances conversion may occur earlier.For the period to the first reset date, each preference share will convert into a number of ordinary shares calculated generally with reference to theconversion discount and the volume weighted average sale price of ordinary shares traded on the ASX during the 20 business days immediately precedingthe conversion date. The number of ordinary shares arising from conversion will be subject to a minimum of 12.82 and a maximum of 100. The conversiondiscount is 2.5%.Computershare may convert the preference shares early in the case of a takeover or tax or regulatory event. A holder may convert at the minimum conversionnumber prior to a reset date by providing 30 business days notice. In this event no dividend is payable in respect of the converting preference shares.Dividends on reset preference shares will be paid in priority to any dividends declared on ordinary shares. In a winding up, reset preference shares will rankfor repayment of capital behind all creditors of Computershare but ahead of ordinary shares. Computershare reserves the right in the future to issueadditional reset preference shares or other securities ranking equally with the reset preference shares.Prior to conversion of reset preference shares, unless the directors otherwise determine in their discretion, holders do not have a right to participate in issuesof securities, or capital reconstructions affecting holders of ordinary shares. However, the minimum and maximum numbers of ordinary shares to be issued onconversion will be adjusted for rights issues, off-market buy-backs, capital distributions, bonus issues and capital reconstructions where appropriate.The reset preference shareholders have no right to vote at general meetings except in limited circumstances.

(b) During the year ended 30 June 2000 Computershare Limited increased its investment in the CDS Group from 20% to 50.02% by the payment of cash andissue of Computershare Limited equity to ACN 088 820 633 Pty Ltd (the parent entity of the CDS Group). The shares were subsequently sold by the CDSGroup at a profit. On consolidation this profit was eliminated and transferred to share capital and the outside equity interest leading to the difference in theshare capital of the parent entity and that of the consolidated entity.


$000s $000s $000s $000s

Movements in ordinary shares for the yearOpening balance: 554,278,613 shares (1 July 2001: 547,612,396) 361,693 354,603 361,187 354,097

Issued during the year Number Price

Date of shares per share

As a result of the exerciseof employee options:July 2001 295,000 $0.4780 – 141 – 141July 2001 1,121,000 $0.9830 – 1,102 – 1,102July 2001 50,000 $0.7280 – 36 – 36July 2001 50,000 $1.7580 – 88 – 88September 2001 136,000 $0.9830 – 134 – 134



Consolidated Parent entityNumber Price 2003 2002 2003 2002

Date of shares per share $000s $000s $000s $000s

19. CONTRIBUTED EQUITY (continued)September 2001 140,000 $1.3680 – 192 – 192September 2001 237,000 $0.4780 – 113 – 113September 2001 12,000 $1.3930 – 17 – 17October 2001 12,000 $0.9830 – 12 – 12November 2001 32,000 $0.9830 – 31 – 31November 2001 35,000 $1.7580 – 62 – 62November 2001 100,000 $1.3680 – 137 – 137December 2001 109,000 $0.9830 – 107 – 107December 2001 290,000 $1.7580 – 510 – 510December 2001 1,000,000 $0.9750 – 975 – 975December 2001 1,750,000 $1.7570 – 3,075 – 3,075December 2001 112,000 $0.4780 – 54 – 54January 2002 80,000 $1.3930 – 111 – 111January 2002 40,000 $1.7580 – 70 – 70March 2002 26,000 $0.9830 – 26 – 26March 2002 86,000 $0.4780 – 41 – 41March 2002 19,000 $1.7580 – 33 – 33April 2002 9,000 $0.9830 – 9 – 9May 2002 20,000 $0.9830 – 20 – 20June 2002 14,000 $0.9830 – 14 – 14June 2002 46,000 $0.4780 – 22 – 22July 2002 48,000 $0.9830 47 – 47 –August 2002 120,000 $0.4780 57 – 57 –September 2002 24,000 $0.9830 24 – 24 –September 2002 95,000 $1.7580 167 – 167 –September 2002 400,000 $0.9030 361 – 361 –October 2002 10,000 $0.9830 10 – 10 –December 2002 265,000 $0.9830 261 – 261 –December 2002 50,000 $1.7580 88 – 88 –January 2003 49,000 $0.9830 48 – 48 –April 2003 40,000 $1.3930 56 – 56 –June 2003 80,000 $1.4380 115 – 115 –June 2003 120,000 $1.3680 164 – 164 –June 2003 80,000 $1.7580 141 – 141 –

As a result of purchases under the employee share plan:30 November 2001 7,009 $3.0810 – 22 – 2231 December 2001 4,204 $3.0810 – 13 – 1331 March 2002 1,502 $3.0810 – 5 – 5

Other issues: Employee share plan30 June 2002 832,502 $0.0000 – – – –Monies not received until shortly after balance date – (82) – (82)30 June 2003 3,391,114 $0.0000 – – – –



Date $000s $000s $000s $000s

19. CONTRIBUTED EQUITY (continued)Share buy-back Between 11 September 2002 and 21 February 2003 the company bought back 18,710,000 ordinary shares at an average cost per share of $2.05. The shares bought back represent 3.38% of issued ordinary shares at the date of the buy-back announcement. (38,351) – (38,351) –

Closing balance: 540,340,727 ordinary shares( 30 June 2002: 554,278,613) 324,881 361,693 324,375 361,187

Options over ordinary shares

Citibank optionsOn 28 August 2002, Computershare provided Citigroup Global Investments options over 12,081,633 unissued ordinary shares at anexercise price of $1.83, in connection with the strategic alliance formed on that date. On 19 August 2003 the company issued548,271 ordinary shares to Citigroup in consideration of the release of the company’s obligation to issue up to 10,581,633 sharesfor $1.83 per share on the exercise of 10,581,633 of the above mentioned options.

Employee optionsComputershare Limited has issued the following options over ordinary shares to eligible employees. The options are generallyexercisable 3 years after the date granted or earlier in the case of the employee’s death or retirement. The options expire 59months after the date issued. Each option entitles the holder to 1 ordinary share upon exercise.

Number Number Number Number Number NumberExercise on issue issued exercised cancelled on issue of

Issue Date Expiry Date price 30/6/02 this year this year this year 30/6/03 recipients

18 Sep 1997 17 Aug 2002 $0.478 120,000 – 120,000 – – –06 Mar 1998 05 Feb 2003 $0.983 396,000 – 396,000 – – –12 Mar 1998 11 Feb 2003 $0.903 400,000 – 400,000 – – –01 Jul 1998 30 Jun 2003 $1.438 80,000 – 80,000 – – –09 Sep 1998 08 Aug 2003 $1.368 288,000 – 120,000 – 168,000 214 Sep 1998 13 Aug 2003 $1.393 112,000 – 40,000 – 72,000 216 Nov 1998 15 Oct 2003 $1.758 470,000 – 225,000 – 245,000 1201 Feb 1999 31 Dec 2003 $2.233 72,000 – – – 72,000 3 A,B26 Apr 1999 25 Mar 2004 $3.083 773,188 – – – 773,188 441 A,B01 Jul 1999 30 May 2004 $3.500 122,000 – – – 122,000 7 A,B01 Jul 1999 30 May 2004 $4.420 160,000 – – 28,000 132,000 27 A,B01 Jul 1999 30 May 2004 $4.500 200,000 – – – 200,000 1 A,B10 Dec 1999 09 Nov 2004 $6.650 80,000 – – – 80,000 1 A,B11 Feb 2000 10 Jan 2005 $6.830 3,870,600 – – 661,850 3,208,750 699 A,B07 Apr 2000 06 Mar 2005 $7.100 1,012,250 – – 108,250 904,000 725 A,B09 Jun 2000 08 May 2005 $6.910 128,250 – – 9,000 119,250 33 A,B12 Jun 2000 11 Jun 2005 $6.910 30,000 – – – 30,000 1 A,B02 Jul 2000 01 Jun 2005 $7.950 51,000 – – 15,000 36,000 7 A,B01 Aug 2000 30 Jun 2005 $7.920 20,000 – – – 20,000 1 A,B15 Aug 2000 14 Jul 2005 $7.850 344,000 – – 65,000 279,000 26 A,B08 Sep 2000 07 Aug 2005 $8.000 1,554,000 – – 523,500 1,030,500 221 A,B25 Sep 2000 24 Aug 2005 $7.970 102,000 – – 3,000 99,000 14 A,B15 Sep 2000 14 Nov 2005 $8.000 67,000 – – – 67,000 5 A,B29 Dec 2000 28 Nov 2005 $9.186 71,200 – – 3,000 68,200 20 A,B21 Feb 2001 20 Jan 2006 $5.820 42,653 – – – 42,653 29 A,B26 Feb 2001 25 Jan 2006 $7.400 110,000 – – 52,000 58,000 19 A,B27 Apr 2001 26 Mar 2006 $6.690 26,000 – – 4,000 22,000 4 A,B



Number Number Number Number Number NumberExercise on issue issued exercised cancelled on issue of

Issue Date Expiry Date price 30/6/02 this year this year this year 30/6/03 recipients

19. CONTRIBUTED EQUITY (continued)01 Jul 2001 10 Mar 2006 $7.350 467,000 – – – 467,000 4 A,B01 Jul 2001 30 May 2006 $5.950 1,078,500 – – 83,000 995,500 410 A,B02 Jul 2001 01 Jun 2006 $5.950 3,788,000 – – 357,000 3,431,000 940 A,B02 Jul 2001 01 Jun 2006 $5.940 96,500 – – 3,000 93,500 30 A,B02 Jul 2001 01 Jun 2006 $7.350 108,000 – – 24,000 84,000 6 A,B31 Jul 2001 30 Jun 2006 $6.150 58,500 – – 7,250 51,250 36 A,B06 Mar 2002 05 Feb 2007 $2.770 2,254,600 – – 270,500 1,984,100 170 B06 Mar 2002 05 Feb 2007 $2.520 110,000 – – – 110,000 5 B10 Apr 2002 09 Mar 2007 $2.520 188,000 – – 6,000 182,000 35 B27 May 2002 26 Apr 2007 $2.550 100,000 – – – 100,000 3 B

Total 18,951,241 – 1,381,000 2,223,350 15,346,891 3,939

Options in the above table that were not included in potential ordinary shares for the purposes of the 30 June 2002 diluted earnings per share are marked withan “A” in the table above.Options in the above table that were not included in potential ordinary shares for the purposes of the 30 June 2003 diluted earnings per share are marked witha “B” in the table above.

The market price of shares under option at 30 June 2003 was $1.87 (2002: $2.20)

No options have been issued since year end.

The following options have been exercised after year end and before the date of this report:

Exercise date Exercise price Number of options exercised

01/07/2003 $1.368 48,00028/07/2003 $1.368 120,00014/08/2003 $1.393 60,00010/09/2003 $1.758 30,00011/09/2003 $1.758 36,00016/09/2003 $1.758 30,000

There are no unissued shares under option as at the date of this report, other than those referred to above.


$000s $000s $000s $000s

20. RESERVESCapital redemption reserve 3 3 3 3Asset revaluation reserve 542 542 542 542Foreign currency translation reserve (18,452) 5,869 – –

(17,907) 6,414 545 545

Movement during the year

Asset revaluation reserveOpening balance 542 542 542 542


Foreign currency translation reserveOpening balance 5,869 30,234 – –Translation of overseas subsidiaries (a) (24,321) (24,365) – –

Closing balance (18,452) 5,869 – –

(a) This amount is the net gains and losses on hedge transactions and intercompany loans after adjusting for related income tax effects.


21. EMPLOYEE ENTITLEMENTS

(a) Employee share and option schemeComputershare Limited offers options over ordinary shares to eligible employees at the absolute discretion of the Board. Options aregenerally exercisable three years after the date granted or earlier in the case of special circumstances such as the employee’s death orretirement. The exercise price of the option is set at an amount equal to the market value of the shares at the date of option grant.

During the year ended 30 June 2001 the company introduced an Exempt Employee Share Plan. The Plan gives Computershareemployees the opportunity to acquire shares in Computershare Limited. Each year, participating employees can make contributionsfrom their pre-tax salary to acquire $500 worth of shares in the company. Such employee contributions are matched by thecompany with an additional $500 worth of shares being acquired for each participating employee. All permanent employees inAustralia with at least 3 months service are entitled to participate in this Plan.

During the year end 30 June 2002 the plan was amended to enable Computershare to match dollar for dollar any employee pre-taxcontributions to a maximum of $3,000 per employee. Shares purchased and funded by employee pre-tax salary must remain in theplan for a minimum of 1 year. Matching company funded shares must be kept in the plan for a minimum of 2 years or they will beforfeited. All permanent employees in Australia with at least 3 months service are entitled to participate in this Plan. A derivative of thisPlan has been made available to employees in New Zealand, the United Kingdom, Ireland, Canada and the United States of America.

Subject to the discretion of the Board, shares in the company may also be allocated to selected employees in accordance with anemployee share plan on a discretionary basis having regard to special circumstances as determined by the Remuneration Committee.Such shares may be subject to vesting and performance criteria as determined by the Board or the remuneration committee.

Ordinary shares Options2003 2002 2003 2002

$000s $000s $000s $000s

Total number allocated to employees during the year 3,834,733 373,500 – 8,548,350Total number allocated to employees since commencement of the scheme 5,727,106 1,892,373 41,540,427 41,540,427

Total number of employees eligible to participate in the scheme 5,029 5,321 5,029 5,321Proceeds received and receivable from share issues or option conversions during the year ($000s) 1,539 7,090 1,539 7,090Fair value of shares issued through the employee share plan (i) 5,400 2,014 – –Proceeds received and receivable from issues during the year ($000’s) – – – –

(i) Fair value is determined by the closing price at the end of the day’s trading on the Australian Stock Exchange. Purchase entitlements not taken up byemployees are forfeited, accordingly no shares or options remain available at balance date for purchase.

Consolidated Parent entity

2003 2002 2003 2002$000s $000s $000s $000s

(b) Employee entitlements recognisedAggregate employee entitlement liability (Refer Note 17 and Note 14) 14,329 13,831 700 741

(c) Number of employeesThe number of full time equivalent employees as at the end of the financial year was 5,029 (2002: 5,321).




$000s $000s $000s $000s

22. FOREIGN CURRENCY EXPOSURE

Current assetsAmounts receivable in foreign currency which are not effectively hedged:– Canadian Dollars 29,368 30,968 1,302 1,362– Cyprus Pounds – 65 – –– Euros 3,459 5,791 – –– Hong Kong Dollars 5,276 8,585 – –– Irish Punts – – – –– New Zealand Dollars 1,633 2,176 – –– Philippines Peso 46 36 – –– Pounds Sterling 35,904 42,623 – –– South African Rand 6,104 7,190 – –– United States Dollars 21,958 28,225 402 –

Current liabilitiesAmounts payable in foreign currency which are not effectively hedged:– Canadian Dollars – – – –– Irish Punts – – – –– New Zealand Dollars – – – –– Philippines Peso 93 – – –– Pounds Sterling 25,178 – – –– South African Rand 4,222 2,466 – –– United States Dollars – – 2,030 1,404

Non-current assetsAmounts receivable in foreign currency which are not effectively hedged:– Canadian Dollars 617 – – –– Hong Kong Dollars – – 3,634 –– Irish Punts – – – 3,090– New Zealand Dollars – – 1,077 4,576– Philippines Peso – – 810 910– Pounds Sterling – – 43,983 156,316– South African Rand – – 1,353 456 – United States Dollars 151 – – –

Non-current liabilitiesAmounts payable in foreign currency which are not effectively hedged:– Canadian Dollars 50,942 19,577 – 19,577– Hong Kong Dollars – – 14,392 18,353– Irish Punts – – – –– Pounds Sterling 45,837 40,486 – 22,942– South African Rand 2,357 4,338 – –– United States Dollars 31,587 14,144 – 7,072

The Australian dollar equivalents of foreign currency monetary items included in the Statements of Financial Position headings tothe extent that they are not effectively hedged are set out above. These amounts include the payables and receivables of foreignsubsidiaries that are not effectively hedged by other foreign currency denominated items.


23. COMMITMENTS

a) Superannuation commitmentsDefined Contribution FundsThe company and its controlled entities maintain defined contribution superannuation schemes which provide benefits to allemployees upon their disability, retirement or death. Employee contributions to the funds are based upon various percentages ofemployees’ gross salaries as set out below:

Australian controlled entities contribute to the defined contribution funds as follows:-Category 1 Management (employer contributions, voluntary employee contributions of at least 1%)

Category 2 Staff (statutory employer contributions, voluntary employee contributions)

Category 3 SGC Staff and casual and fixed term employees (statutory employer contributions, voluntary employee contributions)

Foreign controlled entities contribute to the defined contribution funds as follows:United Kingdom entities – between 5% and 10% of employees gross salariesUnited States entities – voluntary employee contributions with matching employer contribution up to 4% of employees base salariesCanadian entities – between 2% and 7% of employees base salaries dependent upon years of serviceSouth African entities – 12.25% of employees gross salariesNew Zealand entities – voluntary employee contributions with matching employer contribution up to 6% of employees’ base salariesHong Kong – between 10% and 25% of employees’ base salary dependent upon years of service

Defined Benefit FundsComputershare Hong Kong Investor Services Limited maintained a defined benefit superannuation scheme which provides benefitsto 117 (1 January 2001: 137) employees.

Actuarial assessments of the fund are made at no more than three yearly intervals. Information relating to the fund based on thelatest actuarial assessment of the fund at 1 January 2001 and the financial report of the fund for the year ended 31 December 2002 is set out as follows:

Consolidated$000s

Computershare Hong Kong Investor Services Limited – Staff Retirement PlanActuarial valuation of plan assets at 1 January 2001 16,841Actuarial valuation of aggregate past services liability at 1 January 2001 13,964

Net surplus 2,877Actuarial valuation of vested liability as at 1 January 2001 12,924


$000s $000s $000s $000s

(b) Finance lease commitmentsFinance lease commitments are payable as follows:– Not later than 1 year 1,767 2,123 617 678– Later than 1 year but not later than 5 years 2,216 3,187 – 617

Total commitments 3,983 5,310 617 1,295Less: Future finance charges– Not later than 1 year (169) (268) (19) (65)– Later than 1 year but not later than 5 years (224) (260) – (19)

Total future finance charges (393) (528) (19) (84)

Net finance lease liability 3,590 4,782 598 1,211

Reconciled to:– Current liability (Note 15) 2,817 3,503 598 613– Non-current liability (Note 15) 773 1,279 – 598

3,590 4,782 598 1,211

Finance leases are entered into as a means of funding the acquisition of minor items of plant and equipment. Rental payments aregenerally fixed. No leases have escalation clauses other than in the event of payment default. Some leases have purchase options.Where such options exist, they are exercisable at the residual price, which is expected to approximate market prices. No leasearrangements create restrictions on other financing transactions, however the extent of outstanding finance lease obligations isincluded in the determination of other loan covenants.




$000s $000s $000s $000s

23. COMMITMENTS (continued)(c) Operating lease commitmentsOperating lease rentals are payable as follows:– Not later than 1 year 30,924 31,630 2,303 2,866– Later than 1 year but not later than 5 years 94,977 87,864 8,466 4,797– Later than 5 years 64,433 71,078 3,790 –

190,334 190,572 14,559 7,663

Operating leases are entered into as a means of acquiring access to office facilities. Rental payments are generally fixed, but withinflation and/or market escalation clauses on which contingent rentals are determined. Operating lease commitments in respect ofthe rental of various premises are subject to market review at various intervals. Certain leases include an option to renew. Nooperating leases contain restrictions on financing or other leasing activities.

Included within the above is a property lease commitment relating to the new global headquarters of the company to beestablished in Melbourne during 2003/4. This transaction was announced on 13 March 2003.

24. DETAILS OF CONTROLLED ENTITIES The financial years of all controlled entities except for Computershare Canada Inc and its subsidiaries, Computershare Hong KongInvestor Services Limited (prev. Central Registration (Hong Kong) Limited ) and its subsidiary is the same as that of the parent entity.These entities have a 31 December year end.

The consolidated financial statements as at 30 June 2003 include the following controlled entities.

Percentage of shares heldName of controlled entity Place of incorporation 30/06/2003 30/06/2002

% %

Computershare Limited Australia (2) – –ACN 080 903 957 Pty Ltd Australia (2) 100 100

ACN 082 103 295 Pty Ltd Australia 100 100ACN 082 134 503 Pty Ltd Australia 100 100ACN 088 820 633 Pty Ltd Australia (4)(6) 100 100CDS International Limited Australia (4) 100 100

Computershare Document Services Limited Australia (4) 100 100Computershare Document Services Limited United Kingdom (1) 100 100

ACN 081 035 752 Pty Ltd Australia (2) 100 100Computershare Systems (Philippines) Inc Philippines (1) 100 100Computershare Hong Kong Investor Services Limited Hong Kong (1) 76 76

Hong Kong Registrars Limited Hong Kong (1) 76 76Computershare Inc United States of America (1) 100 100

Computershare Technology Services Inc United States of America (1) 100 100Computershare Trust Company of New York Inc United States of America (1) 100 100Computershare Financial Services Inc United States of America (1) 100 100Computershare Investor Services LLC United States of America (1) 100 100

Computershare Trust Company Inc United States of America (1) 100 100Computershare Analytics (North America) Inc United States of America (1) 100 100Computershare Document Services Inc United States of America (1) 100 100Computershare Securities Corporation Inc United States of America (1) 100 100

ACN 005 273 647 Pty Ltd Australia (2)(6) 100 100Computershare Registry Services (PNG) Pty Ltd Papua New Guinea (1) 100 100

Financial Markets Software Consultants Pty Ltd Australia (3) 100 100Computershare Analytics Pty Ltd Australia (4) 100 100

Obadele Pty Ltd Australia (5) 100 100 Computershare Clearing Pty Ltd Australia (2) 100 100

Computershare Depository Pty Ltd Australia (4) 100 100Computershare Finance Company Pty Ltd Australia (4) 100 100Computershare Technology Services Pty Ltd Australia (3) 100 100Registrars Holdings Pty Ltd Australia (2) 100 100

Computershare Investor Services Pty Ltd Australia (2) 100 100


Percentage of shares heldName of controlled entity Place of incorporation 30/6/2003 30/6/2002

% %

CRS Custodian Pty Ltd Australia (3) 100 100Computershare Plan Managers Pty Ltd Australia (4) 100 100

Computershare Plan Co Pty Ltd Australia (5) 100 100CPU Share Plans Pty Ltd Australia 100 –

CIS Debt Securities Pty Ltd Australia (5) 100 100CIS (WA) Pty Ltd Australia (5)(6) – 100

Global Register (Australia) Pty Ltd Australia (3)(6) – 100Sepon (Australia) Pty Ltd Australia (2) 100 100Computershare Limited United Kingdom (1) 100 100Computershare Investments (UK) Limited United Kingdom (1) 100 100Computershare Technology Services (UK) Ltd United Kingdom (1) 100 100Computershare Trustees Limited United Kingdom (1) 100 100Computershare Registry Services Limited United Kingdom (1) 100 100Citywatch Limited United Kingdom (1) 100 100Hlulumiti Limited United Kingdom (1) 100 100

Computershare Analytics (UK) Limited United Kingdom (1) 100 100Computershare Analytics SARL France (1) 100 –

Computershare Investor Services PLC United Kingdom (1) 100 100Exchange Registrars Limited United Kingdom (1) 100 100Computershare Company Nominees Limited Scotland (1) 100 100Computershare PEP Nominees Limited Scotland (1) 100 100Computershare Services Nominees Limited Scotland (1) 100 100

Computershare Services (Channel Islands) Limited Channel Islands (1) 100 100Computershare Investments (UK) (No. 2) Limited United Kingdom (1) 100 100

Computershare Canada Inc Canada (1) 100 100Computershare Trust Company of Canada Canada (1) 100 100

Computershare Investor Services Inc Canada (1) 100 –Computershare Finance LLC United States of America (1) 100 –

Computershare South Africa (Pty) Ltd (prev. Computershare Services (South Africa) Pty Ltd) South Africa (1) 77.43 81.7

Computershare Ltd (prev. Computershare Custodial Services Ltd) South Africa (1) 77.43 81.7Computershare Nominees (Pty) Ltd South Africa (1) 77.43 81.7

CTS Outsourcing Limited (prev. Computershare Outsourcing Limited) South Africa (1) 38.75 81.7Minu Investment Managers Ltd South Africa (1) 77.43 81.7Computershare Investor Services Limited South Africa (1) 77.43 81.7Computershare Management Services (Pty) Ltd South Africa (1) 77.43 81.7Computershare Plan Managers (Pty) Ltd South Africa (1) 77.43 81.7Computershare CSDP Nominees (Pty) Ltd

(prev. Mercantile CSDP Nominees (Pty) Ltd) South Africa (1) 77.43 81.7Computershare Custodial Nominees (Pty) Ltd

(prev. Mercantile Custodial Nominees (Pty) Ltd) South Africa (1) 77.43 81.7Computershare Shareholders Nominee (Pty) Ltd

(prev. Mercantile Shareholders Nominee (Pty) Ltd) South Africa (1) 77.43 81.7Computershare Analytics (Pty) Ltd South Africa (1) 77.43 40.1

Computershare Investor Services (Ireland) Ltd Ireland (1) 100 100Computershare Technology Services (Ireland) Ltd Ireland (1) 100 –

Computershare Trustees (Ireland) Ltd Ireland (1) 100 100Computershare Systems (N.Z.) Ltd New Zealand (1) 100 100Computershare New Zealand Limited New Zealand (1) 100 100

Computershare Investor Services Limited New Zealand (1) 100 100CIS (NZ) Limited New Zealand (1) 100 100Computershare Services Ltd New Zealand (1) 100 100CRS Nominees Ltd New Zealand (1) 100 100Sharemart NZ Limited New Zealand (1) 100 100

(1) Controlled entities audited by other PricewaterhouseCoopers member firms. The USA and Ireland entities above are only audited for Group purposes.(2) These wholly owned companies have entered into a deed of cross guarantee dated 20 July 1998 with Computershare Limited which provides that all parties to

the deed will guarantee to each creditor payment in full of any debt of each company participating in the deed on winding-up of that company. As a result of aClass Order issued by the Australian Securities and Investments Commission, these companies are relieved from the requirement to prepare financial statements.

(3) These companies became parties to the deed of cross guarantee noted in (2) above on 29 June 1999.(4) These companies became parties to the deed of cross guarantee noted in (2) above on 29 June 2001.(5) These companies became parties to the deed of cross guarantee noted in (2) above on 26 June 2002.(6) These companies ceased to be party to the deed of cross guarantee noted in (2) above on 29 April 2003.



24. DETAILS OF CONTROLLED ENTITIES (continued)Financial information for class order Closed Group.

2003 2002$000s $000s

Computershare Limited Closed Group Statements of Financial Position

Current AssetsCash assets 14,479 25,971Receivables 40,326 34,572Inventories 462 563Tax assets – 1,127Other 3,033 3,187

Total Current Assets 58,300 65,420

Non-Current AssetsReceivables 249,282 260,310Other financial assets 397,081 390,553Property, plant and equipment 17,271 21,272Deferred tax assets 30,619 19,508Intangibles – goodwill 61,195 66,552Other 2,393 896

Total Non-Current Assets 757,841 759,091

Total Assets 816,141 824,511

Current LiabilitiesPayables 21,755 28,723Interest bearing liabilities 1,244 1,502Current tax liabilities 9,766 3,193Provisions 1,140 15,043Other – deferred settlement of acquisition of entity – –

Total Current Liabilities 33,905 48,461

Non-Current LiabilitiesInterest bearing liabilities 130,566 218,650Deferred tax liabilities 6,190 8,066Provisions 3,660 3,333

Total Non-Current Liabilities 140,416 230,049

Total Liabilities 174,321 278,510

Net Assets 641,820 546,001

EquityContributed equity – ordinary shares 324,881 361,693Contributed equity – reset preference shares 147,195 147,205Preference shares held by subsidiary outside of the closed group 104,596 –Reserves 624 631Retained profits 64,524 36,472

Total Equity 641,820 546,001

Computershare Limited Closed Group Statements of Financial PerformanceRevenuesSales revenue 178,872 187,460Other revenues from ordinary activities 65,204 31,778

Total Revenue 244,076 219,238


2003 2002

ExpensesDirect services (a) 113,428 120,062Technology services (a) 34,197 40,866Corporate services (a) 14,467 16,248Borrowing costs 13,548 6,846Net foreign exchange loss on hedges 17,224 383

Total Expenses 192,864 184,405

Profit/(loss) from ordinary activities before income tax expense 51,212 34,833Income tax (expense)/benefit relating to ordinary activities (1,490) (6,944)

Net profit/(loss) 49,722 27,889Net profit/(loss) attributable to outside equity interests – –

Net profit/(loss) attributable to members of the parent entity 49,722 27,889Opening net assets of entities first included in the cross guarantee this period (refer to Note 24(6)) – –

Total changes in equity other than those resulting from transactions with owners as owners 49,722 27,889

Set out below is a summary of movements in consolidated retained profits for the year of the Closed Group.

Retained profits at the beginning of the financial year 36,472 30,088Profit from ordinary activities after income tax expense/benefit 49,722 27,889Dividends provided or paid (21,670) (21,505)

Retained profits at the end of the financial year 64,524 36,472

(a) Depreciation and amortisation expense for the prior period has been reclassified to Direct services, Technology services and Corporate services.

25. REMUNERATION OF DIRECTORS AND OFFICERS

a) Income of directorsThe number of directors of the parent entity who were paid, or were due to be paid, income (including brokerage, commissions,bonuses, retirement payments, superannuation and salaries, but excluding prescribed benefits disclosed later in this note under“retirement benefits”) directly or indirectly from the company or any related party, as shown in the following bands, were:

2003 2002

$0 – $9,999 2 1$90,000 – $99,999 1 –$110,000 – $119,999 2 1$120,000 – $129,999 1 1$180,000 – $189,999 – 1$370,000 – $379,999 – 1$380,000 – $389,999 – 1$400,000 – $409,999 – 1$410,000 – $419,999 1 –$470,000 – $479,999 1 –$490,000 – $499,999 – 1$2,310,000 – $2,319,999 (a) 1 –

The aggregate income of the directors referred to above $3,671,565 $2,084,056

a) Other benefits include a separation payment of $1,642,924.

The total of all income paid or payable, directly or indirectly, from the respective entities of which they are a director, or from anyrelated party, to all the directors of each entity in the consolidated entity was $15,638,059 (2002: $16,500,083). This amountincludes the value of insurance premiums and indemnity payments made for the benefit of directors but excludes the value ofoptions granted during the period, as these are granted at no cost to the company.



25. REMUNERATION OF DIRECTORS AND OFFICERS (continued)

b) Income of executivesThe numbers of executive officers (including executive directors detailed above) whose total income for the year falls within thefollowing bands were:


$150,000 – $159,999 1 – – –$160,000 – $169,999 1 1 – –$170,000 – $179,999 – 1 – –$180,000 – $189,999 – 1 – –$190,000 – $199,999 – 1 – –$200,000 – $209,999 1 – – –$220,000 – $229,999 1 – – –$240,000 – $249,999 1 – – –$260,000 – $269,999 1 – – –$300,000 – $309,999 1 – 1 –$320,000 – $329,999 1 – – –$360,000 – $369,999 2 – 1 –$380,000 – $389,999 – 1 – 1$390,000 – $399,999 – 1 – –$400,000 – $409,999 – 1 – –$410,000 – $419,999 1 – 1 –$470,000 – $479,999 1 – – –

The aggregate income of the executives referred to above was $3,506,185 $1,901,300 $1,085,913 $386,333

Income of executives comprises amounts paid or payable to executive officers domiciled in Australia, directly or indirectly, by theconsolidated entity or any related party (but excluding prescribed benefits disclosed later in this note under “retirement benefits”) inconnection with the management of the affairs of the entity or consolidated entity, whether as executive officers or otherwise.

Aggregate income of executives does not include the value of options granted during the period, as these are granted at no cost tothe company.

Executives for this disclosure include only those persons who, during the year, had the greatest authority for managing the group.

Retirement benefitsThere were no retirement allowances paid to directors or principal executive officers of the company and the controlled entitiesduring the period.


$ $ $ $

26. REMUNERATION OF AUDITORSRemuneration received, or due and receivable, by the auditors of the parent entity and its affiliates for:Auditing or review of financial statements – Arthur Andersen – 377,000 – 89,000– PricewaterhouseCoopers 1,487,000 1,000,000 415,680 150,000Other services (a)

– Arthur Andersen – 75,000 – 44,000– PricewaterhouseCoopers 253,000 188,000 11,034 –Remuneration received, or due and receivable, by auditors otherthan the auditor of the parent entity and its affiliates for:Auditing or review of financial statements – 38,000 – –Other services – 325,000 – –

(a) This relates primarily to regulatory and compliance services.


27. RELATED PARTY DISCLOSURES

(a) DirectorsThe following directors held the position of director of Computershare Limited during all of the past two financial years, unlessotherwise stated:

P D DeFeo (Appointed 4 June 2002)M E Elliot (Appointed 5 January 2001, Resigned 8 November 2001)T M Butler (Appointed 15 May 2003)W E Ford (Appointed 17 January 2003)P J GriffinP J Maclagan C J MorrisA S Murdoch I D Saville (Appointed 1 May 2002, Resigned 15 May 2003)A N Wales

Details of directors’ remuneration and superannuation payments are set out in Note 25.

(b) Directors’ shareholdingsShares issued by the

Parent entity2003 2002

Ordinary shares held at the end of the financial year 107,236,751 105,812,751Reset preference shares held at the end of the financial year 1,330 330Options held at the end of the financial year – –Ordinary dividends received during the year in respect of those ordinary shares $5,327,163 $1,050,415Reset preference dividends received during the year in respect of those reset preference shares $7,315 $925Reset preference shares acquired by directors during the financial year 1,000 330Ordinary shares acquired by directors during the financial year 1,527,000 1,589,567Ordinary shares disposed of by directors during the financial year 103,000 250,000

(c) Other transactions with directors or director-related entitiesC J Morris is a director and major shareholder in Modara Grange Pty Ltd which entered into rental agreements with the company in the ordinary course of business on commercial terms and conditions. Rent received by Modara Grange Pty Ltd $18,750 $8,550

C J Morris is a director and major shareholder in Fraser Island Pty Ltd which provided conference facilities to the company in the ordinary course of business on ordinary commercial terms and conditions. Fees received by Fraser Island Pty Ltd $33,712 –

C J Morris and P J Maclagan are directors and major shareholders in Ellon Holdings Pty Limited which entered into rental agreements with the company in the ordinary course of business on commercial terms and conditions. Rent received by Ellon Holdings Pty Limited $27,581 $191,032

(d) Wholly owned groupThe parent entity and its controlled entities entered into the following transactions during the year within the wholly owned group:

• Loans were advanced and repayments received on loans and intercompany accounts (refer Notes 6 and 15)

• Sales were made between entities (refer Note 2)

• Interest was charged between entities (refer Note 2)

• The parent entity and its Australian controlled entities have entered into a tax sharing arrangement (refer Note 3)

These transactions were undertaken on commercial terms and conditions.



27. RELATED PARTY DISCLOSURES (continued)

(e) Associated entities Computershare Technology Services Pty Ltd has a receivable of $484,560 (2002: $413,993) from Chelmer Limited. This receivable has been fully provided for. The current year provision made is $70,567 (2002: $98,339).

Computershare New Zealand Ltd has a receivable of $1,727,118 (2002: $1,563,742) from Chelmer Limited. This receivable has beenfully provided for. The current year provision made is $163,376 (2002: $261,175).

Computershare Technology Services Pty Ltd has made sales of $70,567 (2002: $98,339) to Chelmer Limited.

Computershare Limited (incorporated in UK) has a receivable of $577,173 (2002: nil) from Deutsche Börse Computershare GmbH.This receivable is in respect of costs paid on behalf of Deutsche Börse Computershare GmbH.

Computershare Limited (incorporated in UK) has a receivable of $720,322 (2002: nil) from ComputersharePepper SRM Limited (awholly owned subsidiary of pepper technologies AG). This receivable is in respect of costs paid on behalf of ComputersharePepperSRM Limited.

There have been no transactions between the group and The National Registry Company.

(f) Ultimate controlling entityThe ultimate controlling entity of the consolidated entity is Computershare Limited.

28. SIGNIFICANT EVENTS AFTER BALANCE DATENo matter or circumstance has arisen since the end of the financial year which is not otherwise dealt with in this report or in the consolidated financial statements that has significantly affected or may significantly affect the operations of theconsolidated entity, the results of those operations or the state of affairs of the consolidated entity in subsequent financial years,other than on 19 August 2003 the company issued 548,271 ordinary shares to Citigroup in consideration of the release of thecompany’s obligation to issue up to 10,581,633 shares for $1.83 per share on the exercise of a like number of options.

29. FINANCIAL INSTRUMENTSThe consolidated entity uses derivative financial instruments to manage specifically identified interest rate and foreign currencyrisks. The consolidated entity is primarily exposed to the risk of adverse movements in the Australian dollar relative to certainforeign currencies, including the United States dollar, Canadian dollar and Great British pound, and to movements in interest rates.The purposes for which specific derivative instruments are used are as follows:

The consolidated entity raises non-Australian dollar denominated debt that is designated as a hedge of the net investment in self-sustaining foreign operations, in which case the exchange gain or loss is transferred to the foreign currency translation reserve.Forward exchange contracts and foreign currency options are also used by the consolidated entity in relation to foreign subsidiaries’earnings. To the extent that the financial instrument does not satisfy the conditions for hedge accounting as set out in UIG 33, thosegains or losses are recognised immediately in the statement of financial performance.

The consolidated entity uses interest rate derivatives to manage the floating interest rate exposure that arises as a result ofmaintaining paying agent and escrow agent accounts on behalf of customers and to enhance returns on funds. The United Kingdomoperations also use interest rate swaps to manage the interest rate exposure on certain Save As You Earn Schemes (“SAYE”) asdescribed below.


(a) Administration of Save As You Earn Schemes Computershare Investor Services PLC, a controlled entity of Computershare Limited, administers approximately 200 SAYE schemeson behalf of various listed UK entities. Under such schemes, employees make regular monthly contributions which attractgovernment set interest or bonus credits. Interest is generally calculated at 1.0 times one month contributions for 3 year plans, 3.7times one month contributions for 5 year plans and 7.6 times one month contributions for 7 year plans. The total contribution plusinterest is then used by the employees to purchase shares in the sponsoring listed entity. Employees leaving a Scheme earlyreceive interest at reduced rates. Employees’ monthly contributions are held by a licensed deposit taker who enters into SAYEcontracts with the employees and, as such, is responsible to repay the principal contribution plus the legislated bonus on maturityof the scheme. Computershare Investor Services PLC has been appointed as administrator by the licensed deposit taker and isresponsible for scheme management. As agent, Computershare Investor Services PLC indemnifies the licensed deposit takershould the return on funds deposited with them not meet the bonus payment required by law. These arrangements create interestrate risk due to the fixed rates payable on employee monthly contributions and the floating interest rate received on balances heldby the licensed deposit taker.

The Group employs interest rate risk management techniques, including the use of interest rate swaps and options, to manage theinterest rate exposure. In some instances the bonus payable to SAYE participants is embedded within the hedge instruments used.The fair value of SAYE hedge instruments at 30 June 2003 amounted to $48.7 million (2002: $56.9 million), of which a significantportion is payable to participants.

In addition extensive modelling is undertaken to determine the net present value of the forecast cash outflows to employees withadjustments to reflect forecast attrition rates.

(b) Paying Agent Funds Administration In addition to the above SAYE scheme administration bank accounts, Computershare maintains certain paying agent and escrowagent accounts on behalf of customers. Computershare earns service fee income for administering funds as part of the service.Such funds, which at year end approximated $3.2 billion (2002: $3.9 billion), are deposited in agency bank accounts at call. Giventhe nature of the accounts, neither the funds nor an offsetting liability are included in the Group’s financial statements.

During the year ended 30 June 2002 an overseas entity became a licensed deposit taker. As at year end this controlled entity hasaccepted broker client deposits in its own name which at year end approximated $36 million (2002: $41 million), and recorded thesefunds as other financial assets together with a corresponding liability. The deposits are insured through a local regulatory authority.

(c) Interest rate risk exposuresThe consolidated entity is exposed to interest rate risk through primary financial assets and liabilities, modified through derivativefinancial instruments such as interest rate swaps and options. The following table summarises the interest rate risk for theconsolidated entity, together with effective interest rates as at the balance date.

Fixed interest rate maturing inFloating interest 1 year Over 1 to Non-interest Average interest rate

As at 30 June 2003 rate (a) or less 5 years bearing Total Floating Fixed$000 $000 $000 $000 $000 % %

Financial assetsCash 60,828 – – – 60,828 2.82 –Broker client deposits 35,987 – – – 35,987 3.00 –Trade debtors – – – 95,126 95,126 – –Non-trade debtors and loans – – – 2,676 2,676 – –

96,815 – – 97,802 194,617

Financial liabilitiesBroker client deposits 35,987 – – – 35,987 3.00 –Trade creditors – – – 5,711 5,711 – –Finance lease liabilities – 2,817 773 – 3,590 – 6.98Other loans – – – 1,000 1,000 – –Bank loan – 2,747 2,357 – 5,104 – 15.50Revolving multicurrency facilities 129,793 – – – 129,793 3.15 –

165,780 5,564 3,130 6,711 181,185



29. FINANCIAL INSTRUMENTS (continued)

Fixed interest rate maturing inFloating interest 1 year Over 1 to Non-interest Average interest rate

As at 30 June 2002 rate (a) or less 5 years bearing Total Floating Fixed$000 $000 $000 $000 $000 % %

Financial assetsCash 74,327 – – – 74,327 3.38 –Broker client deposits 41,517 – – – 41,517 2.63 –Trade debtors – – – 100,826 100,826 – –Non-trade debtors and loans – – – 10,907 10,907 – –

115,844 – – 111,733 227,577

Financial liabilitiesBroker client deposits 41,517 – – – 41,517 2.63 –Trade creditors – – – 14,169 14,169 – –Finance lease liabilities – 3,503 1,279 – 4,782 – 6.75Other loans – – – 1,000 1,000 – –Bank loan – 2,472 4,338 – 6,810 – 15.50Revolving multicurrency facilities 97,207 – – – 97,207 3.78 –Hedge payables – – – 8,044 8,044 – –

138,724 5,975 5,617 23,213 173,529

(a) Floating interest rates represent the most recently determined rate applicable to the instrument at balance date.

The interest rate exposures set out in the above table do not include the exposure relating to SAYE account balances and payingagent balances. Under the SAYE schemes there are at year end approximately GBP 273 million (2002: GBP 255 million) of employeeaccount balances earning fixed rates as described in Note 29(a). Interest rate swaps of GBP 218 million (2002: GBP 231 million) arein place to hedge the floating rate receivables against fixed rate payable amounts forecast. The effect of the interest rate swaps isto convert the income margin on administered funds to a fixed rate and to hedge the cost of fixed rates credited to employeeaccount balances. The margin between the fixed rates paid to SAYE participants and fixed rates received via the interest rate swapsis approximately 0.8%. The average floating interest rate at balance date is 3.75%. The maturity profile of these swaps is generallybetween one to five years. In relation to paying agent balances (refer Note 29(b)), Computershare has in place interest rate swapsand options totalling $1.4 billion (2002: $1.3 billion).

(d) Credit risk exposuresCredit exposure represents the extent of credit related losses that the consolidated entity may be subject to on amounts to bereceived from financial assets. The consolidated entity, while exposed to credit related losses in the event of non-performance bycounterparties, does not expect any counterparties to fail to meet their obligations given their high credit ratings.

The consolidated entity’s exposure to “on Statements of Financial Position” credit risk is as indicated by the carrying amounts of itsfinancial assets. Concentrations of credit risk (whether or not recognised in the Statements of Financial Position) exist for groups ofcounterparties when they have similar economic characteristics that would cause their ability to meet contractual obligations to besimilarly affected by changes in economic or other conditions. The consolidated entity does not have a significant exposure to anyindividual counterparty.

The consolidated entity minimises concentrations of credit risk by undertaking transactions with a large number of debtors in variouscountries and industries. The software sales and development segment transacts primarily with the broking and financial marketsindustry. The registry and bureau sector transacts with various listed companies across a number of countries.


The major geographic concentrations of credit risk arise from the location of the counterparties to the consolidated entity’s financialassets as shown in the following table:


Location of Credit risk $000s $000s

Australia 25,679 27,064Canada 19,530 21,654Hong Kong 5,433 5,594Finland 861 –Ireland 3,738 5,301New Zealand 1,257 2,111Philippines 46 36South Africa 6,100 7,326United Kingdom 22,055 27,689United States of America 11,854 13,923Other European 911 –Other 338 1,035

97,802 111,733

The following table summarises the consolidated entity’s credit exposure on derivative financial instruments with a positive net fairvalue and has been reduced by unfavourable contracts with the same counterparty pursuant to master netting agreements, whichwill not be settled before the favourable contracts. These swaps relate to the Group’s administration of numerous SAYE schemesand interest rate exposures arising from agency activities on behalf of customers.


Derivatives $000s $000s

Interest rate derivatives – SAYE schemes 48,703 56,862Foreign exchange derivatives 1,970 –Interest rate derivatives – other 15,674 1,424

66,347 58,286

(e) Net fair value of financial assets and liabilitiesThe carrying amounts of trade debtors, trade creditors, finance leases and loans approximate their fair values.


Carrying amount Net fair value Carrying amount Net fair value$000 $000 $000s $000s

DerivativesForeign exchange options (115) 1,602 – 73Foreign exchange contracts – 368 (7,965) (7,958)Interest rate derivatives 691 14,893 1,898 (788)

(f) Foreign ExchangeThe following table summarises by currency the Australian dollar value of forward foreign exchange agreements. Foreign currencyamounts are translated at rates current at the reporting date. The ‘buy’ amounts represent the Australian dollar equivalent ofcommitments to purchase foreign currencies, and the ‘sell’ amount represents the Australian dollar equivalent of commitments tosell foreign currencies. Contracts to buy and sell foreign currency are entered into from time to time to hedge the net investment inand earnings from foreign operations.



29. FINANCIAL INSTRUMENTS (continued)2003 2002

Currency Average Exchange Rate Buy Sell Buy Sell2003 2002 $000s $000s $000s $000s

United States dollars:3 months or less – 0.6055 – – – 85,285Over 3 months to 12 months – – – – – –

Canadian dollars:3 months or less 0.8879 0.8793 1,227 2,917 1,052 88,008Over 3 months to 12 months 0.8906 – – 7,579 – –

British pounds:3 months or less 0.3840 – 1,241 1,494 – –Over 3 months to 12 months – 0.3690 – – – 540

New Zealand dollars:3 months or less 1.0929 1.1761 262 1,086 – 507Over 3 months to 12 months 1.0925 1.1761 – 2,471 – 1,522

Total 2,730 15,547 1,052 175,862

30. NOTES TO THE STATEMENTS OF CASH FLOWS

(a) Reconciliation of cashFor the purposes of the Statements of Cash Flows, cash includes cash on hand and at bank and short-term deposits at call, net ofoutstanding bank overdrafts. Cash as at the end of the financial year as shown in the Statements of Cash Flows is reconciled to therelated items in the Statements of Financial Positions as follows:


$000s $000s $000s $000s

Cash at bank and on hand 48,764 42,504 1,602 2,542Short-term deposits 12,064 31,823 2,006 7,000

Shown as cash on statement of financial performance 60,828 74,327 3,608 9,542

(b) Reconciliation of net profit after income tax to net cash provided by operating activitiesNet profit after income tax 17,133 57,753 45,460 58,556Adjustments for non-cash income and expense items:– Depreciation of property, plant and equipment 24,894 21,951 453 406– Amortisation of leased assets 1,193 1,115 514 618– Amortisation of leasehold improvements 2,905 2,006 16 16– Amortisation of employee shares 347 85 223 74– Amortisation of establishment costs 135 67 – –– Amortisation of premium/(discount) on forward exchange contracts (2,318) (1,485) – –– Amortisation of goodwill 31,263 29,869 – –– Foreign exchange (gains)/losses on hedges – – (27) (23)– Foreign exchange (gains)/losses unrealised – (802) (6,590) (1,146)– Foreign exchange (gains)/losses on financial instruments (509) (1,406) – (1,070)– (Profit)/loss on sale of plant and equipment 419 (5) – –– (Profit)/loss on sale of investments (8) (1,889) – –– Share of net (profit)/loss in associates using equity accounting 2,036 – – –– Decrease in underwriting liability to controlled

entity following novation of financial instruments – – (8,044) (16,914)– Other (81) – (1) –



$000s $000s $000s $000s

(b) Reconciliation of net profit after income tax to netcash provided by operating activities (continued)

– Changes in assets and liabilities:– (Increase)/decrease in accounts receivable 9,361 10,168 393 (2,050)– (Increase)/decrease in prepayments (1,095) (1,441) 237 (757)– (Increase)/decrease in inventory (748) 1,486 – –– (Increase)/decrease in current tax assets 735 (1,733) 5 –– (Increase)/decrease in deferred tax assets (9,948) (10,857) (5,399) 6,096– (Increase)/decrease in other assets (2,512) (377) 141 59– Increase/(decrease) in payables (8,462) (4,091) 807 (314)– Increase/(decrease) in income tax liabilities (937) (20,592) 10,437 (3,478)– Increase/(decrease) in provisions 15,343 (10,300) 66 (329)– Increase/(decrease) in deferred tax liability (806) 9,424 (424) (2,601)– Increase/(decrease) in reserves (2,161) 408 – –

Net cash provided by operating activities 76,179 79,354 38,267 37,143

(c) Controlled entities acquired or formedThe following controlled entities were acquired or formed by the consolidated entity at the dates stated and their operating resultshave been included in the Statements of Financial Performance from the relevant date.

Entity acquired Date acquired Proportion of Considerationshares acquired 2003 2002

$000s $000s

Obadele Pty Ltd 27 July 2001 100% – –

CIS Debt Securities Pty Ltd (prev. BT Registries Pty Ltd) 1 September 2001 100% – 10,253CIS (WA) Pty Ltd (prev. BT Registries (WA) Pty Ltd) 1 September 2001 100% – –CIS (NZ) Limited (prev. BT Portfolio Services (NZ) Limited) 1 September 2001 100% – 2,827Citywatch Limited (prev. Computershare Analytics (UK) Limited) 1 October 2001 100% – –Mercantile CSDP Nominees (Pty) Ltd 2 April 2002 100% – –Mercantile Custodial Nominees (Pty) Ltd 2 April 2002 100% – –Mercantile Shareholders Nominee (Pty) Ltd 2 April 2002 100% – –Hong Kong Registrars Limited (refer Note 30 f) 1 June 2002 100% – –Computershare Analytics Pty Ltd 31 March 2003 100% 178 –

Total consideration 178 13,080

Computershare Canada Inc was incorporated on 3 July 2001.Computershare Plan Co Pty Ltd, a subsidiary of Computershare Plan Pty Ltd, was formed on 10 October 2001.Computershare Investments (UK) (No. 2) Limited was formed on 14 December 2001.Computershare Financial Services Inc was incorporated on 30 November 2001.Computershare Investor Services Inc was incorporated on 9 December 2002.Computershare Finance LLC was incorporated on 12 November 2002.Computershare Technology Services (Ireland) Ltd was incorporated on 6 March 2003.Computershare Analytics SARL was incorporated on 7 March 2003.CPU Share Plans Pty Ltd was incorporated on 18 March 2003.



30. NOTES TO THE STATEMENTS OF CASH FLOWS (continued)

(c) Controlled entities acquired or formed (continued)

The amounts of assets and liabilities acquired by major class are:

2003 2002$000s $000s

Cash assets (32) 584Receivables 95 2,482Prepayments – 42Property, plant and equipment 83 527Deferred tax assets 21 1,209Intangible assets including goodwill on acquisition 156 9,622Payables (10) (149)Interest bearing liabilities (135) –Current tax liabilities – (529)Provisions – (708)

Consideration paid and payable 178 13,080

Outflow of cash to acquire the entities, net of cash acquired:

Cash balance acquired 32 (584)

Outflow of cash 210 12,496

(d) Acquisition of businesses

Business acquired Date purchased Consideration2003 2002

$000s $000s

Mercantile registry business 2 April 2002 – 17,945Charles Schwab Employee Plans 12 December 2002 1,690 –EFA Market Technologies 7 February 2003 7,404 –Fifth Third Bancorp 30 June 2003 3,241 –

Total 12,335 17,945

The amounts of assets and liabilities acquired by major class are:

Charles EFA Fifth Schwab Market Third 2003 2002

Employee Plans Technologies Bancorp$000s $000s $000s $000s $000s

Property, plant and equipment – 7,404 – 7,404 3,438Intangible assets including goodwill on acquisition 2,098 – 5,402 7,500 17,071Payables (39) (437) – (476) –Provisions – – – – (2,564)

Consideration paid and payable 2,059 6,967 5,402 14,428 17,945Less: consideration paid in prior periods/payable in future periods (408) – (2,161) (2,569) –Other acquisition costs 39 437 – 476 –

Outflow of cash 1,690 7,404 3,241 12,335 17,945


(e) Financing facilitiesThe consolidated entity has access to the following financing facilities with a number of financial institutions:


$000s $000s $000s $000s

FacilitiesBank overdraft facilities 326 11,097 – 5,000Bank loans 5,104 6,810 – –Leasing facility 3,637 4,782 598 727Revolving multi-currency facility 240,000 255,500 – –Uncommitted facility (i) 66,898 – – –Other facilities 1,000 1,000 1,000 1,000

Total facilities 316,965 279,189 1,598 6,727

Facilities utilisedBank overdraft facilities – – – –Bank loans 5,104 6,810 – –Leasing facilities 3,590 4,782 598 727Revolving multi-currency facility 129,793 97,207 – –Other facilities 1,000 1,000 1,000 1,000

Total facilities utilised 139,487 109,799 1,598 1,727

Unused facilities 177,478 169,390 – 5,000

(i) The uncommitted facility has been arranged to enable the consolidated entity to offer deferred financing of options to clients as part of our Employee Plansbusiness in the UK.

(f) Non-Cash transactionsOn 1 June 2002 Computershare Hong Kong Investor Services Limited (CHIS) issued shares to a subsidiary of the Hong KongSecurities Clearing Company Limited (MPL) equivalent to 18% of the expanded CHIS share capital. These shares were issued inconsideration for MPL transferring its interest in its Hong Kong registry operations to CHIS.

31. CONTINGENT LIABILITIESContingent liabilities at balance date, not otherwise provided for in these financial statements are categorised as follows:

a) Guarantees and IndemnitiesGuarantees and indemnities of $240,000,000 (30 June 2002: $260,500,000) have been given to the consolidated entity’s AustralianBankers by Computershare Limited, Computershare Technology Services Pty Limited, CDS International Limited, ComputershareInvestor Services Limited, Computershare New Zealand Limited, Computershare Investor Services Ltd (incorporated in NZ),Computershare Ltd (incorporated in UK), Computershare Investor Services PLC, Computershare Inc, Computershare InvestorServices LLC, Computershare Services (Ireland) Ltd, Computershare Finance Company Pty Ltd, Computershare Technology Services(UK) Ltd, Computershare Financial Services Inc, ACN 081 035 752 Pty Ltd, Computershare Investor Services Inc, ComputershareCanada Inc, Computershare Finance LLC and Computershare Investments (UK)(No. 2) Ltd as security for Computershare FinanceCompany Pty Ltd’s facilities. (Note 15).

Guarantees of $4,944,341 (30 June 2002: $6,226,458) have been given by Computershare Limited as security for bonds in respectof leased premises.

Guarantees of $3,001,200 (30 June 2002: nil) have been given by Computershare Investor Services LLC as security for payrolladministration services in USA.

Bank guarantees of $270,000 (2002: $270,000) have been given in respect of facilities provided to Computershare Clearing Pty Ltd.

A bank guarantee of $250,000 (2002: $250,000) has been given in respect of facilities provided to Sepon Australia Pty Ltd.

A bank guarantee of $150,000 (2002: $150,000) has been given in respect of facilities provided to Computershare Investor ServicesPty Ltd.

A bank guarantee of $256,786 (2002: nil) has been given by Computershare Technology Services Pty Ltd in relation to certaincustomer contacts.

Bank guarantees totalling $2,006,465 (2002: nil) have been given by Computershare Trust Company of Canada and ComputershareInvestor Services Inc in respect of standby letters of credit for the payment of payroll.



31. CONTINGENT LIABILITIES (continued)

b) Legal MattersDue to the nature of operations, certain commercial claims in the normal course of business have been made againstComputershare in various countries. The directors, based on legal advice, are contesting all of these matters. The majority of theseclaims are covered by insurance. It is considered unlikely that any material liability to the Group will eventuate.

c) OtherAs noted in this financial report the Group is subject to regulatory capital requirements administered by certain US and Canadianbanking commissions. These requirements pertain to the trust company charter granted by the commission. Failure to meetminimum capital requirements, or other ongoing regulatory requirements, can initiate action by the regulators that, if undertaken,could revoke or suspend the Group’s ability to provide trust services to customers in these markets. At all relevant times theComputershare subsidiary has met all minimum capital requirements. In addition to the capital requirement, a trust company mustdeposit eligible securities with a custodian. The Group has deposited a certificate of deposit with the Group’s custodian in thisjurisdiction in order to satisfy this requirement.

Computershare Limited (Australia) has issued a letter of warrant to Computershare Custodial Services Ltd. This obligatesComputershare Limited (Australia) to maintain combined tier one capital at Rand 500,000,000.

Potential withholding and other tax liabilities arising from distribution of all retained distributable earnings of all foreign incorporatedsubsidiaries $7,115,160 (30 June 2002: $7,659,921). No provision is made for withholding tax on unremitted earnings of applicableforeign incorporated controlled entities as there is currently no intention to remit these earnings to the parent entity.

32. CAPITAL EXPENDITURE COMMITMENTSConsolidated Parent entity

2003 2002 2003 2002$000s $000s $000s $000s

Less than 1 year:Fitout of premises – – – 245Purchase of equipment 1,565 5,562 – –

1,565 5,562 – 245


33. SEGMENT INFORMATION The consolidated entity operates predominantly in six business segments: Investor services, Plan services, Document services,Analytics services, Corporate and Technology services. The Investor services operations comprise provision of registry services. ThePlan services operations comprise the provision and management of employee share plans. Document services operationscomprise laser imaging, intelligent mailing, scanning and electronic delivery. The Asia geographic segment includes Hong Kong andPhilippines. Segment revenues, expenses and results include transfers between segments. Such transfers are priced on an “arms’-length” basis and are eliminated on consolidation.

PRIMARY BASIS – Business Segments2003

Major business Analytics Corporate Document Investor Plan Technology Unallocated/ Consolidatedsegments Services Services Services Services Services Services Eliminations Total

$000s $000s $000s $000s $000s $000s $000s $000s

RevenueExternal revenue 14,412 7,179 39,260 544,618 80,239 19,623 3,266 708,597Inter-segment revenue 55 64,905 59,547 8,736 2,947 98,639 (234,829) –

Total segment revenue 14,467 72,084 98,807 553,354 83,186 118,262 (231,563) 708,597

Segment ResultProfit from ordinaryactivities before income tax (2,776) (18,270) 8,761 32,750 (1,236) 1,923 8,310 29,462

Income tax expense (12,329)

Profit from ordinary activities after income tax 17,133

Depreciation 26 2,494 2,868 6,087 196 18,416 (5,193) 24,894

Amortisation goodwill 926 – 835 25,195 2,825 1,482 – 31,263Other non-cash expenses 10 (1,566) 1,261 2,265 153 139 – 2,262

LiabilitiesTotal segment liabilities 2,149 138,284 9,167 132,255 2,323 10,448 11,373 305,999

AssetsTotal segment assets 20,408 918,385 48,478 675,556 55,827 46,516 (870,764) 894,406

Carrying value of investments in associates included in segment assets – 15,845 – – – – – 15,845

Segment assets acquired during the reporting period:Investments – 17,639 – 12,014 1,690 7,409 – 38,752Property, plant and equipment 55 1,662 1,412 6,659 61 8,084 – 17,933

Total 55 19,301 1,412 18,673 1,751 15,493 – 56,685



33. SEGMENT INFORMATION (continued)2002

Major business Analytics Corporate Document Investor Plan Technology Unallocated/ Consolidatedsegments Services Services Services Services Services Services Eliminations Total

$000s $000s $000s $000s $000s $000s $000s $000s

RevenueExternal revenue 13,160 13,452 37,266 612,747 66,188 31,564 6,589 780,966Inter-segment revenue 50 56,407 44,887 2,129 8 83,838 (187,319) –

Total segment revenue 13,210 69,859 82,153 614,876 66,196 115,402 (180,730) 780,966

Segment ResultProfit from ordinary activities before income tax (1,412) (7,134) 6,421 88,864 (1,415) (7,192) 5,616 83,748


Profit from ordinary activitiesafter income tax 57,753

Depreciation 96 1,816 2,871 8,132 188 15,209 (6,361) 21,951

Amortisation goodwill 966 – 852 23,562 3,007 1,482 – 29,869Other non-cash expenses 11 (740) 824 1,629 91 10 – 1,825

LiabilitiesTotal segment liabilities 1,820 131,230 8,529 122,249 1,907 9,807 28,426 303,968


Segment assets acquired during the reporting period:Investments – 1,122 – 30,447 – – – 31,569Property, plant and equipment 51 15,103 4,314 20,441 2,977 14,000 – 56,886

Total 51 16,225 4,314 50,888 2,977 14,000 – 88,455


SECONDARY BASIS – Geographic Segment2003

Major geographic Asia Australia Canada South Europe USA Unallocated/ Consolidated

segments and New Africa Eliminations TotalZealand

$000s $000s $000s $000s $000s $000s $000s $000s

RevenueExternal revenue 27,393 187,197 143,117 33,454 198,445 115,725 3,266 708,597

Segment ResultProfit from ordinary activities before income tax 5,591 14,466 6,913 (6,584) 13,692 (12,926) 8,310 29,462


Profit from ordinary activities after income tax 17,133


Segment assets acquired during the reporting period:Investments 86 7,840 8,089 206 17,600 4,931 – 38,752Property, plant and equipment 244 3,304 1,868 3,765 4,662 4,090 – 17,933

Total 330 11,144 9,957 3,971 22,262 9,021 – 56,685



33. SEGMENT INFORMATION (continued)

2002

Major geographic Asia Australia Canada South Europe USA Unallocated/ Consolidated

segments and New Africa Eliminations TotalZealand

$000s $000s $000s $000s $000s $000s $000s $000s

RevenueExternal revenue 26,384 210,180 157,369 21,393 211,903 147,148 6,589 780,966

Segment ResultProfit from ordinary activities before income tax 8,330 22,936 18,494 1,846 36,289 (9,762) 5,615 83,748


Profit from ordinary activitiesafter income tax 57,753


Segment assets acquired during the reporting period:Investments 4 13,620 – 17,945 – – – 31,569Property, plant and equipment 163 8,575 12,470 10 20,073 15,595 – 56,886

Total 167 22,195 12,470 17,955 20,073 15,595 – 88,455

Segment information is prepared in conformity with the accounting policies of the entity as disclosed in Note 1 and revisedsegment reporting accounting standard, AASB 1005 Segment Reporting.

Segment revenues, expenses, assets and liabilities are those that are directly attributable to a segment and the relevant portion thatcan be allocated to the segment on a reasonable basis. Segment assets include all assets used by a segment and consist primarilyof operating cash, receivables, inventories, property plant and equipment and goodwill and other intangible assets, net of relatedprovisions. Corporate segment assets also include financial assets. Segment liabilities consist primarily of trade and other creditors,employee entitlements and other provisions. Corporate segment liabilities also include borrowings. Segment assets and liabilitiesdo not include income taxes.


34. ASSOCIATED ENTITIES

Details of interests in associated entities are as follows:

ConsolidatedName Principal Place of Ownership Interest Balance Carrying amount

Activities Incorporation 2003 2002 Date 2003 2002$000s $000s

Equity accountedChelmer Limited Computer New Zealand 50% 50% 30 June – –

TechnologyServices

Pepper technologies AG Shareholder United Kingdom 26.65% – 31 December 6,376 –RelationshipManagement Services

Deutsche Börse Computershare GmbH Investor Services Germany 49% 49% 31 December 8,014 –The National RegistryCompany Investor Services Russia 29.875% – 31 December 1,455 –

Total investments in associated entities 15,845 –


$000s $000s

Share of associates’ resultsProfit/(loss) before income tax (479) –Income tax – –

Profit/(loss) after tax (479) –Amortisation of goodwill (1,557) –

Share of net result of associates (2,036) –Retained profits at the beginning of the financial year – –

Retained profits at the end of the financial year (2,036) –

Share of associates’ reservesForeign currency translation reserveBalance at the beginning of the financial year – –Share of translation of overseas associates 278 –

Balance at the end of the financial year 278 –

Movements in carrying value of investments in associatesCarrying amount at the beginning of the financial year – –Investments acquired during the year 17,603 –Share of net result from ordinary activities after income tax (479) –Amortisation of goodwill (1,557) –Share of movement in reserves during the financial year 278 –

Carrying amount at the end of the financial year 15,845 –

Share of associates’ capital expenditure commitmentsLease commitments 79 –

Contingent liabilitiesThere are no material contingent liabilities in respect of associates at balance date.



35. JOINT VENTURESJoint Venture entityFor further details of the Deutsche Börse joint venture please refer to Note 34.


$000s $000s

Retained profits attributable to the joint ventureAt the beginning of the financial year – –At the end of the financial year (345) –Foreign currency translation reserve attributable to the joint ventureAt the beginning of the financial year – –At the end of the financial year 139 –Movement in carrying amount of investment in joint venture Carrying amount at the beginning of the financial year – –Investments acquired during the year 9,525 –Share of net result from ordinary activities after income tax (345) –Amortisation of goodwill (1,305) –Share of movement in reserves during the financial year 139 –

Carrying amount at the end of the financial year 8,014 –

Share of joint venture assets and liabilitiesCurrent assets 4,252 –Non-current assets 5 –

Total assets 4,257 –

Current liabilities 438 –Non-current liabilities 2 –

Total liabilities 440 –

Net assets 3,817 –

Share of joint venture revenues, expenses and resultsRevenues 1,278 –Expenses (1,623) –

Profit/(loss) from ordinary activities before related income tax (345) –

Share of joint venture capital expenditure commitmentsThere are no material capital expenditure commitments in respect of joint ventures at balance date.

Share of Joint Venture Contingent liabilitiesThere are no material contingent liabilities in respect of joint ventures at balance date.

36. INTERESTS IN EQUITYMembers of Parent entity Outside Equity Interest

2003 2002 2003 2002$000s $000s $000s $000s

Interest in the equity of the consolidated entity:Contributed equity – ordinary shares 324,881 361,693 6,245 5,862Contributed equity – reset preference shares 147,195 147,205 – –Reserves (17,907) 6,414 (2,164) (1,028)Retained profits 128,366 133,781 1,791 1,821

Total Interest in Equity 582,535 649,093 5,872 6,655


DIRECTORS’ DECLARATIONThe directors of Computershare Limited declare that the financial statements and notes set out on pages 11 to 58:

(a) comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reportingrequirements; and

(b) give a true and fair view of the company’s and consolidated entity’s financial position as at 30 June 2003 and of theirperformance, as represented by the results of their operations and their cash flows, for the financial year ended on that date.

In the directors’ opinion:

(i) the financial statements and notes are in accordance with the Corporations Act 2001; and

(ii) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due andpayable; and

(iii) at the date of this declaration, there are reasonable grounds to believe that the members of the Extended Closed Groupidentified in Note 24, will be able to meet any obligations or liabilities to which they are, or may become, subject by virtueof the deed of cross guarantee described in Note 24.

This declaration is made in accordance with a resolution of the directors.

AS MURDOCH CJ MORRISChairman Director16 September 2003


60

PricewaterhouseCoopersABN 52 780 433 757

333 Collins StreetMELBOURNE VIC 3000GPO Box 1331LMELBOURNE VIC 3001DX 77 MelbourneAustraliawww.pwc.com/auTelephone +61 3 8603 1000Facsimile +61 3 8603 1999

INDEPENDENT AUDIT REPORT TO THE MEMBERS OFCOMPUTERSHARE LIMITED

Audit opinionIn our opinion, the financial report of Computershare Limited:

• gives a true and fair view, as required by the Corporations Act 2001 in Australia, of the financial position ofComputershare Limited and the Computershare Limited Group (defined below) as at 30 June 2003, and of theirperformance for the year ended on that date, and

• is presented in accordance with the Corporations Act 2001, Accounting Standards and other mandatory financialreporting requirements in Australia, and the Corporations Regulations 2001.

This opinion must be read in conjunction with the rest of our audit report.

Scope

The financial report and directors’ responsibilityThe financial report comprises the statement of financial position, statement of financial performance, statement of cashflows, accompanying notes to the financial statements, and the directors’ declaration for both Computershare Limited (thecompany) and the Computershare Limited Group (the consolidated entity), for the year ended 30 June 2003. Theconsolidated entity comprises both the company and the entities it controlled during that year.

The directors of the company are responsible for the preparation and true and fair presentation of the financial report inaccordance with the Corporations Act 2001. This includes responsibility for the maintenance of adequate accountingrecords and internal controls that are designed to prevent and detect fraud and error, and for the accounting policies andaccounting estimates inherent in the financial report.

Audit approachWe conducted an independent audit in order to express an opinion to the members of the company. Our audit wasconducted in accordance with Australian Auditing Standards, in order to provide reasonable assurance as to whether thefinancial report is free of material misstatement. The nature of an audit is influenced by factors such as the use ofprofessional judgement, selective testing, the inherent limitations of internal control, and the availability of persuasiverather than conclusive evidence. Therefore, an audit cannot guarantee that all material misstatements have beendetected.

We performed procedures to assess whether in all material respects the financial report presents fairly, in accordancewith the Corporations Act 2001, Accounting Standards and other mandatory financial reporting requirements in Australia,a view which is consistent with our understanding of the company’s and the consolidated entity’s financial position, andof their performance as represented by the results of their operations and cash flows.

Computershare Detailed Financial Report 2003

61

We formed our audit opinion on the basis of these procedures, which included:

• examining, on a test basis, information to provide evidence supporting the amounts and disclosures in the financialreport, and

• assessing the appropriateness of the accounting policies and disclosures used and the reasonableness ofsignificant accounting estimates made by the directors.

When this audit report is included in an Annual Report, our procedures include reading the other information in theAnnual Report to determine whether it contains any material inconsistencies with the financial report.

While we considered the effectiveness of management’s internal controls over financial reporting when determining thenature and extent of our procedures, our audit was not designed to provide assurance on internal controls.

Our audit did not involve an analysis of the prudence of business decisions made by directors or management.

IndependenceIn conducting our audit, we followed applicable independence requirements of Australian professional ethicalpronouncements and the Corporations Act 2001.

PricewaterhouseCoopers

Russell Sutton MelbournePartner 16 September 2003


62

SHAREHOLDER INFORMATIONThis section contains additional information required by the Australian Stock Exchange Limited listing rules not disclosed elsewherein this report.

SHAREHOLDINGSSubstantial Shareholders The following information is extracted from the Company’s Register of Substantial Shareholders.

Name Date of notice to Company Number of ordinary shares

Christopher John Morris 8 May 2003 55,447,042General Atlantic Partners 12 March 2003 53,000,705Schroder Investment Management 18 June 2003 46,479,492Anthony Norman Wales 14 September 2000 32,592,384Portfolio Partners Limited 29 April 2003 32,280,202Class of shares and voting rightsAt 26 August 2003 there were 27,674 holders of ordinary shares in the Company. The voting rights attaching to the ordinary shares,set out in clause 50 of the Company’s Constitution, are:

“ (a) every member may vote

(b) on a show of hands every member has one vote, and

(c) on a poll every member has:

(i) for each fully paid share held by the member, one vote; and

(ii) for each partly paid share held by the member, a fraction of a vote equivalent to the proportion that the amount paid upbears to the total issue price of the share.”

At 26 August 2003 there were 4,082 holders of reset preference shares in the company. The voting rights of reset preference shareare one vote for each share, but voting rights are limited to matters affecting the rights of reset preference shareholders.

At 26 August 2003 there were 15,118,891 options over ordinary shares issued to eligible employees at the absolute discretion ofthe Board. The options are generally exercisable 3 years after the date granted or earlier in the case of the employee’s death orretirement.

Distribution of shareholders of shares as at 26 August 2003Size of holding Ordinary shareholders Reset preference shareholders

1 – 1,000 8,538 3,9861,001 - 5,000 13,165 785,001 - 10,000 3,303 410,001 and over 2,668 14

Total shareholders 27,674 4,082

There were 879 shareholders holding less than a marketable parcel of 239 ordinary shares at 26 August 2003.

There were 5 shareholders holding less than a marketable parcel of 6 reset preference shares at 26 August 2003.


63

Twenty Largest Shareholders of ordinary shares as at 26 August 2003Ordinary Shares

Number %

National Nominees Limited 111,175,073 20.55Finico Pty Limited 55,447,042 10.25J P Morgan Nominees Australia 42,700,635 7.89Welas Pty Limited 32,592,384 6.02Westpac Custodian Nominees 22,644,843 4.18P J Maclagan 16,567,525 3.06Citicorp Nominees Pty Limited 13,256,712 2.45Queensland Investment Corporation 13,081,702 2.42M J O’Halloran 12,568,529 2.32RBC Global Services Australia Nominees Pty Limited (CGU Insurance) 5,920,383 1.09AMP Life Limited 4,912,288 0.91Commonwealth Custodial Services Limited 4,539,869 0.84Australian Foundation Investment Company Limited 4,500,000 0.83CPU Share Plans Pty Ltd 3,343,250 0.62Cogent Nominees Pty Limited 3,058,435 0.57Mr Gary Leslie Ryan 2,769,732 0.51ANZ Nominees Limited 2,389,742 0.44RBC Global Services Australia Nominees Pty Limited (PP Account) 2,338,242 0.43RBC Global Services Australia Nominees Pty Limited 2,069,730 0.38ARGO Investments Limited 2,060,000 0.38

Total 357,936,116 66.14

Twenty Largest Shareholders of reset preference shares as at 26 August 2003Reset preferences shares

Number %

Australian Foundation Investment Company Limited 174,602 11.64J P Morgan Nominees Australia Limited 96,407 6.43ARGO Investments Limited 73,164 4.88Djerriwarrh Investments Limited 67,000 4.47Share Direct Nominees Pty Ltd 50,660 3.38Equity Trustees Limited 23,515 1.57Tower Trust Limited 20,896 1.39Sandhurst Trustees Ltd 14,417 0.96Permanent Trustee Company Limited 14,382 0.96Mirrabooka Investments Limited 13,000 0.87Westpac Financial Services Limited 12,500 0.83UBS Warburg Private Clients Nominees Pty Ltd 11,850 0.79Mr Gerald Harvey 10,500 0.70RBC Global Services Australia Nominees Pty Limited 10,497 0.70Bond Street Custodians Limited 10,000 0.67J.B. Were Capital Markets 9,200 0.61Warana Grange Pty Ltd 5,710 0.38McCusker Holdings Pty Ltd 5,500 0.37Australian United Investment Company Limited 5,000 0.33Invia Custodian Pty Limited 5,000 0.33

Total 633,800 42.26


Designed and printed by Computershare Document Services Ermington NSW Australia ph 612 8877 3000 fx 612 8877 3111

CORPORATE DIRECTORYAlexander Stuart Murdoch (Chairman)

Christopher John Morris (Chief Executive Officer)

Peter John Griffin

Penelope Jane Maclagan

Anthony Norman Wales

Philip Daniel DeFeo

William E Ford

Thomas Michael Butler

COMPANY SECRETARIES

Paul Xavier Tobin

Mark Benjamin Davis

REGISTERED OFFICE

18-62 Trenerry Crescent

Abbotsford Victoria 3067

PO Box 103 Abbotsford

Victoria Australia 3067

Telephone +61 3 9235 5500

Facsimile +61 3 9235 5601

STOCK EXCHANGE LISTINGS

Australian Stock Exchange Limited

The New Zealand Stock Exchange

American Depository Receipts*

SOLICITORS

Minter Ellison

Level 23, Rialto Towers

525 Collins Street

Melbourne Victoria 3000

AUDITORS

PricewaterhouseCoopers

333 Collins Street


SHARE REGISTRY

Computershare Limited

18-62 Trenerry Crescent

Abbotsford Victoria 3067

PO Box 103 Abbotsford

Victoria Australia 3067

Telephone +61 3 9235 5500

Facsimile +61 3 9235 5600

INVESTOR RELATIONS

18-62 Trenerry Crescent,

Abbotsford, Vic 3067

Telephone + 61 3 9235 5500

Facsimile + 61 3 9235 5601

Email [email protected]

Website www.computershare.com/investorrelations

BANKERS

National Australia Bank Limited

500 Bourke Street


Australia and New Zealand Banking Group Limited

530 Collins Street


The Royal Bank of Scotland plc

Corporate and Institutional Banking

135 Bishopsgate

London EC2M 3UR

* Computershare has an unlisted ADR program in the United States of

America. Information is available from the depository;

Computershare Trust Company of New York

Wall Street Plaza Level 19, 88 Pine Street,

New York, NY USA 10005

www.computershare.com

Documents

CPU Detail Fin Text OUTPUT - Computershare