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JV GLOBAL LIMITED and

Controlled Entities

ANNUAL REPORT 2010

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JV Global Limited and Controlled Entities - 2010 Annual Report

1

Table of Contents

Chairman’s Report 2

Directors’ Report 4

Corporate Governance Statement 11

Auditor’s independence declaration 15

Consolidated Statement of Comprehensive Income 16

Consolidated Statement of Financial Position 17

Consolidated Statement of Changes in Equity 18

Consolidated Statement of Cash Flows 19

Notes to the Financial Statements 20

Independent Auditor’s Report 50

Directors’ Declaration 53

Shareholder Information 54

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Chairman’s Report

Dear Shareholder

Against the backdrop of the effects of the Global Financial Crisis the past financial year has presented many challenges for JV Global Limited (“the Company”; “JVG”) and its controlled entities (“the Consolidated Entity”).

During the first six months of the 2010 financial year the continued rationalisation and re-structuring of both JV Global Limited and its wholly owned subsidiary JVG Framing Pty Ltd trading as Component Homes was undertaken.

On 11 August, 2009 the Company issued 139,850,000 shares at 0.01 cent per share to complete a capital raising of $1,398,500.00 pursuant to the prospectus dated 2 July, 2009. An additional 10,000,000 shares were issued for no consideration as compensation for capital raising services provided.

Following the capital raising which included provision of working capital for the subsidiary Component Homes, a Kit Home builder for the regional and rural areas of Western Australia, the Board of JVG appointed to Component Homes a Managing Director under contract with apparent qualifications, and a Chief Financial Officer. These appointments were undertaken to fully and totally manage Component Homes with undertakings from the newly appointed Managing Director that the business could be transformed into a profitable division by March 2011 with months of financial breakeven periods leading up to that month. The initial brief of the Managing Director was to assess the business some 6 weeks prior to his formal appointment in September 2009 to ensure he understood the business prior to his appointment.

In April 2010 the Managing Director resigned without notice and the CFO also gave notice leaving the subsidiary in a very vulnerable position and after having absorbed a considerable portion of the capital raised by the parent company, JVG. JVG injected additional funds into the subsidiary based on the ongoing assurances of an inevitable turnaround and eventual profitability as outlined in various projections and cash flow forecasts provided to the JVG Board by management of Component Homes, albeit frequently late.

However, as a result of the resignations and comments by our auditors in relation to the condition of the accounts of Component Homes, the JVG Board and Company Secretary immediately became directly involved in the daily activities of Component Homes.

It soon became apparent that the JVG Board had for some time been receiving considerably inaccurate data and information contained in reports that did not reflect the true forward projections, profitability or position of Component Homes. It was also evident that quoting procedures were flawed in relation to figures provided to the Board. In addition the promised necessary procedural changes had not been effectively implemented nor had effective sales and marketing programs.

After assessing the position of Component Homes and reaching the conclusion that it was not in the interests of JVG shareholders to continue to fund Component Homes in its current condition, it was agreed to appoint a voluntary administrator. The purpose of this appointment was to provide a report on the affairs of the subsidiary in order to allow the JVG Board to thoroughly assess the future of Component Homes’ business.

Dino Travaglini of Moore Stephens, Chartered Accountants was appointed Voluntary Administrator on July 13, 2010. His appointment will allow the JVG Board to pursue more positive activities on behalf of the shareholders during this period that have been previously outlined in our statements to the exchange and shareholders.

The cash drain has delayed the potential diversification of JVG and although recent opportunities received from within the construction industry have been considered by the JVG Board, the Board felt that most of these would have jeopardised the overall financial position and listed status of the parent company to the detriment of its shareholders.

The Board of JVG believe that as disappointing as this situation is now, it is a positive move in the right direction as it has removed the ongoing burden of that subsidiary in its current format and allows a new invigoration of the Consolidated Entity’s activities going forward.

Pending the outcome of the assessment by the Voluntary Administrator, JVG will instigate a new capital raising program by way of a possible placement under section 708 to Sophisticated Investors and has announced a non renounceable rights issue to existing shareholders which we hope the shareholders will support for the future of the Consolidated Entity. Existing shareholders are being given the first opportunity to increase their shareholding prior to any shortfall being offered to non shareholders at the same offer price as previously completed in 2009. Any shareholders with unmarketable parcels should take advantage of this opportunity to increase their shareholding to more sizeable parcels and any existing shareholders who may wish to take up more than their entitlement should apply for any shortfall.

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Directors’ Report

Your directors submit their report for the year ended 30 June 2010.

This annual report covers both JV Global Limited as an individual entity and the consolidated entity comprising JV Global Limited and its subsidiaries (“the Consolidated Entity”). The Consolidated Entity's functional and presentation currency is AUD ($). A description of the Consolidated Entity's operations and its principal activities is included in the review of operations and activities in the directors' report on pages 5 and 6. The directors' report is not part of the financial report.

DIRECTORS

The names and details of the company’s directors in office during the financial year and until the date of this report are as follows. Directors were in office for this entire period unless otherwise stated.

Names, qualifications, experience and special responsibilities

Terence H Opie

Managing Director, Executive Director, appointed 14 February 2005

Experience and special responsibilities

Mr Opie has over thirty years experience in the financial services industry including consulting to Asian investment bankers and assisting with the establishment of lease finance companies in South East Asia. Mr Opie established JV International Pty Ltd a company concerned with the marketing and sales of CNC roll-forming plant and equipment for overseas markets. Mr Opie subsequently incorporated JV Global Australia Pty Ltd to participate in overseas joint ventures. During the past three years Mr Opie has not served as a director of any other listed company.

Peter M Burns FCPA, FTIA, FNTAA

Chairman, Independent Non-Executive Director, appointed 14 February 2005 - resigned 5 October 2009


Mr Burns is Chairman of the Board and also the Audit Committee. He is a Certified Practising Accountant with over 40 years experience and has served on a number of Divisional and National committees for CPA Australia. He is also a director of Kingsway Community Financial Services Ltd which holds a franchise with The Bendigo Bank.

Collin Vost

Non-Executive Director, appointed 29 May 2009


Mr Vost has a Diploma Financial Services, Dip AII, AAII, Derivatives Accredited Level 2 and Superannuation Accredited has been involved in Public Companies for more than 28 years and served on the board of a number of junior companies over the years. Mr Vost is also a Director of and controls Zurich Securities Pty Ltd which holds an Australian Financial Services licence (AFSL 317392) who are involved in retail share trading, Corporate Advice (Project Identification and Mergers) and Corporate Capital Raising for listed companies and IPO’s.

He is also a Director of Cervantes Corporation Ltd and Baraka Petroleum Ltd.

Robert A Arrigoni

Non-Executive Director, appointed 29 May 2009


Mr Arrigoni is a Qualified Accountant, with many years of commercial business knowledge and particular experience with fiscal matters. He is also a director or company secretary for twelve propriety limited entities.

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Directors’ Report continued

COMPANY SECRETARY

James Moran, B.Bus., GradDipAppCorpGov, CPA, FCIS, MAICD,

Company Secretary, appointed 5 May 2009


Mr. Moran has extensive experience in the corporate areas covering capital raisings, investor relations, financial reporting, treasury management, compliance and risk management in the publicly listed company sector. His past responsibilities, which have predominately been in the resources sector, have involved contract negotiations and management, project accounting, budgeting, administration, supply logistics, human resources functions and industrial relations.

Interests in the shares and options of the company and related bodies corporate

As at the date of this report, the interests of the directors in the shares and options of JV Global Limited were:

2010 2009

Number of

Ordinary Shares

Employee

Share Options

Unlisted

Share Options

Number of

Ordinary Shares

Employee

Share Options

Unlisted

Share Options

T.H. Opie 14,221,974 6,000,000 - 14,221,974 6,000,000 -

P.M. Burns - 1,500,000 - 2,619,690 1,500,000 -

S.J. Hwang - - - 4,275,000 - -

P.G. Kailis - - - 7,501,850 - -

K.S. McKinnon - 1,500,000 - 223,500 1,500,000 -

R Arrigoni 1,275,000 - - 1,275,000 - -

C Vost 11,575,000 - 5,000,000 8,575,000 - 5,000,000 DIVIDENDS

No dividends were paid or proposed by the Directors in respect of the financial years ended 30 June 2010 or 30 June 2009.

PRINCIPAL ACTIVITIES

The Consolidated Entity’s principal activities are the manufacture and sale of steel building products, the global marketing and sales of CNC roll forming production lines, associated technology transfer and joint ventures for the manufacture of steel building products.

SHARES ISSUED DURING THE YEAR

There were a total of 149,850,000 shares issued during the year ended 30 June 2010.

OPERATING AND FINANCIAL REVIEW

The consolidated loss of $2,425,224 (2009: $5,839,000) for the financial year ended 30 June, 2010 was extremely disappointing through a very challenging period.

The subsidiary company, JVG Framing Pty Ltd trading as Component Homes, continued to underperform despite the parent company committing considerable funds to support Component Homes’ existing operations and their working capital position.

In September, 2009 the Board of JV Global Limited appointed a new highly qualified Managing Director of JVG Framing Pty Ltd with the specific task of reviewing the subsidiary’s policies and procedures with the view to improving sales and resultant profitability.

Unfortunately Component Homes’ position continued to deteriorate further during the subsequent six months despite repeated assurances from the managing director that the subsidiary’s performance could be turned around within the six months to June, 2010.

In April, 2010 the Managing Director resigned without notice and the Chief Financial Officer gave one months notice of her resignation. As a result of these resignations JV Global Limited moved to undertake a full review of operations which resulted in identifying anomalies in the financial statements provided to the Board of JV Global Limited.

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Detailed discussions were then entered into with several parties in respect to the ongoing activities of JVG Framing Pty Ltd and these were ongoing as at 30 June 2010.

As previously reported the Consolidated Entity’s joint venture in the United Arab Emirates, Arabian Profile Global Co LLC suffered a fire in February 2009 which resulted in the factory, plant and equipment being destroyed.

Full comprehensive insurance was in place and JV Global limited has now received funds representing their entitlement in accordance with their percentage shareholding (46%) in the joint venture. Business activity has currently ceased and the Consolidated Entity is now in the process of collecting outstanding accounts including retention monies due on completed contracts.

As a direct result of the Global Financial Crisis the business activities of Sharus Steel Products Pvt Ltd our joint venture company in India have also been affected as building and construction activities in the Indian housing sector had slowed down dramatically.

The Board of JV Global Limited are currently in discussions with their joint venture partners, Shapoorji Pallonji.

The operational overheads of JV Global Limited have been drastically reduced to allow a more positive and rejuvenated plan for 2010/11 with total support of our major shareholders and Convertible Note Holders.

As previously reported the Directors of JV Global Limited continue to seek and identify opportunities that may add value to the company’s existing shareholders. The Board are currently involved in ongoing discussions with several parties in regards to participation in ventures within our sector and others which could provide a refreshing diversification.

Financial Position

The net deficiency position of the Consolidated Entity has increased by $1,066,445 from 30 June 2009 to $2,698,822 in 2010.

SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

During the financial year there were no significant changes in the state of the affairs of the consolidated entity other than that referred to in the financial statements or notes thereto.

SIGNIFICANT EVENTS AFTER THE REPORTING DATE

As announced to the market on 14 July 2010, the Board of the subsidiary company, JVG Framing Pty Ltd (trading as Component Homes), appointed a Voluntary Administrator on 13 July 2010 to manage the affairs of the business. Mr Dino Travaglini of Moore Stephens, Chartered Accountants is the Voluntary Administrator (“the Administrator”) appointed under Part 5.3A of the Corporations Act 2001.To date the Administrator has been canvassing potential buyers and assessing offers presented with regards to the sale of the assets or components of the business. It is expected that any sales will be resolved in the next few weeks.

The Board has committed to undertake a raising of further capital to revitalise and rejuvenate the group by pursuing more actively the assessment of new projects and ventures for a possible diversification of activities as well as expansion of our current approved activities. Preparation of the necessary documentation is well advanced and details of this offer will be announced shortly.

The Board of JV Global Ltd announced on 28 September 2010 a Joint Venture agreement with Steelcut Enterprises Pty Ltd trading as “Steelhomes” who in themselves have extensive experience in the same industry. The joint venture will allow JVG to utilise and merge its extensive contacts within the steel frame housing and commercial building industry by way of outsourcing its contracts to Steelhomes on a Fee basis, depending on the size and nature of the project, at the same time as avoiding the large staffing costs and capital expenditure requirements of factory premises and plant & equipment. This joint venture, subject to the success thereof, will allow the parties to consider the creation of a new entity with possible increased capital and technological improvements in the industry with a low cost base start. The joint venture also allows JVG access to the use of a builders licence which had previously restricted JVG’s ability to tender for and or take on specific styles of work or expand their offerings to their potential client enquiries.

In addition to the above, the Consolidated Entity moved to new premises in South Perth in September 2010.

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LIKELY DEVELOPMENTS AND EXPECTED RESULTS

The Consolidated Entity will continue to assess new investment opportunities that the Board believe will create value for shareholders.

Further information on likely developments in the operations of the consolidated entity and the expected results of those operations have not been included in the financial report because the directors believe it would likely result in unreasonable prejudice to the Consolidated Entity.

ENVIRONMENTAL REGULATION AND PERFORMANCE

The Consolidated Entity’s operations are not subject to any particular and significant environmental regulation under a law of the Commonwealth or of a State or Territory.

SHARE OPTIONS

Unissued Shares

As at the date of this report, there were 15,425,000 options on issue, each to subscribe for one ordinary share (225,578,235 at 30 June 2010). Refer to Note 28 of the financial statements for further details of the options outstanding.

Option holders do not have any right, by virtue of the option, to participate in any share issue of the company or any related body corporate or in the interest issue of any other registered scheme.

Options

At the date of this report, the unissued ordinary shares of JV Global Limited under option are as follows:

Grant Date Expiry Date Exercise Price Number of

Options

23 August 2007 23 August 2012 $0.30 each 10,350,000

28 April 2008 28 April 2013 $0.30 each 75,000

20 August 2009 30 December 2010 $0.02 each 5,000,000

15,425,000

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

During the year ended 30 June 2010, no ordinary shares were issued on the exercise of options granted. No further shares have been issued since year end. No amounts are unpaid on any of the shares.

INDEMNIFICATION AND INSURANCE OF OFFICERS AND AUDITORS

During the financial year, the Consolidated Entity paid a premium in respect of a contract insuring the directors of the Company (as named above), the company secretary, and all executive officers of the Consolidated Entity and of any related body corporate against a liability incurred as such a director, secretary or executive officer to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.

The Consolidated Entity has not otherwise, during or since the financial year, indemnified or agreed to indemnify an officer or auditor of the Consolidated Entity or of any related body corporate against a liability incurred as such an officer or auditor.

REMUNERATION REPORT - AUDITED

This report outlines the remuneration arrangements in place for directors and executives of the Consolidated Entity.

Non-Executive Director Remuneration

JV Global Limited’s Board determines the remuneration policies and levels for directors and executives. The Managing Director is responsible for setting the remuneration of all the employees under his control, within broad policy and guidelines that may be set by the Board from time to time. The Board will review the remuneration packages, as recommended by the Managing Director, in respect of the senior executives.

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Directors’ fees will be set at appropriate levels that take into account the size of the Consolidated Entity, its industry, the time required of directors in properly fulfilling their respective roles, the risks involved, and the general market in Australia for directors’ fees. Whenever necessary, the overall level of Directors’ fees will be submitted to a meeting of shareholders for approval. A distinction is made between the remuneration of non-executive and executive directors. Executive directors will normally be remunerated as part of their employment package.

The Consolidated Entity did not have any performance incentive remuneration arrangements with any director or other employee during the year. On 17 August 2007 shareholders approved the JVG Employee Share Option Scheme rules and the approval of granting of options to directors. Further details of these Employee Options and the Consolidated Entity’s equity based remuneration arrangements are set out in Note 28 of the financial Statements.

In setting remuneration levels for Key Management Personnel, Directors & Executives, it is the board’s policy to link such levels with the direct or indirect benefits estimated to accrue to shareholders; that is, to strike an appropriate balance between cost and benefit. Performance bonuses may be payable from time to time and will be a benefit to shareholders by way of dividend or increased share prices. The fee arrangements for non-executive directors do not contain a bonus element other than the granting of Employee Options to Mr Burns.

Consolidated Performance, Shareholder Wealth and Key Management Personnel and Executive’s Remuneration

The remuneration policy is monitored to ensure continued alignment between remuneration of directors and executives and the creation of shareholder wealth through the Consolidated Entity’s financial performance. Current remuneration packages for directors and executives reflect the loss made in the current year and the present stage of the Consolidated Entity’s development.

At the present time neither short term nor long term incentives are paid to directors or executives.

Key Management Personnel and Executive Details

The Directors of JV Global Limited during the year were: Appointed Resigned

Terence H Opie 14 February 2005

Collin Vost 29 May 2009

Robert Arrigoni 29 May 2009

Peter M Burns 14 February 2005 5 October 2009

Other Executives and Key Management Personnel of the Consolidated Entity during the year were:

James Moran - Company Secretary 5 May 2009

Rachel Constable - Chief Financial Officer 27 July 2009 21 May 2010

Geoff Wilton - Chief Executive Officer of JVG Framing Pty Ltd 1 August 2009 23 April 2010

Keith Hutson - Technical & Operations Manager 1 August 2008 23 January 2010

Michael Hutson - Manager JVG Framing Pty Ltd 2 April 2009 17 November 2009

There were no directors appointed or executives employed by subsidiary companies other than as stated above.

Remuneration of Key Management Executives

Elements of director and executive remuneration

• Remuneration packages contain the following key elements:

• Fixed remuneration - Salary and fees;

• Short term benefits; - the Consolidated Entity currently does not pay short term incentives;

• Long term benefits - the Consolidated Entity currently does not pay long term incentives;

• Non monetary benefits - includes the provision of benefits other than by cash; and

• Post-employment benefits - including superannuation and prescribed retirement benefits

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Table 1: Key Management Personnel and Executive’s remuneration for the year ended 30 June 2010

Short Term Benefits

Post Employment

Salaries & Fees

Short Term Incentives

Equity-settled share-based

payments Super-

annuation Total

$ $ $ $ $

T.H. Opie 2010 86,320 - 30,205 6,196 122,721

Managing Director 2009 150,667 - 39,640 50,600 240,907

C Vost 2010 28,000 - - - 28,000

Non-Executive Director 2009 4,000 - - - 4,000

R Arrigoni 2010 18,000 - - - 18,000

Non-Executive Director 2009 - - - - -

P Burns resigned 5 October 2009 2010 4,000 - 15,103 - 19,103

Non-Executive Director 2009 16,500 - 19,820 - 36,320

S J Hwang 2010 - - - - -


P.G. Kailis 2010 - - - - -


J Moran 2010 - - - - -

Company Secretary 2009 - - - - -

K.S. McKinnon 2010 - - 15,103 - 15,103

Company Secretary 2009 100,000 - 19,820 8,650 128,470

G Wilton resigned 23 April 2010 2010 189,334 - - - 189,334

Chief Executive Officer, JVG Framing Pty Ltd 2009 - - - - -

R Constable resigned 21 May 2010 2010 84,801 - - 7,632 92,433

Chief Financial Officer 2009 - - - - -

K Hutson resigned 23 January 2010 2010 36,386 - 5,808 3,275 45,469

Technical & Operations Manager 2009 110,881 - 3,097 9,979 123,957

M Hutson resigned 17 November 2009 2010 35,626 - - 3,206 38,832

General Manager, JVG Framing Pty Ltd 2009 91,899 - - 8,271 100,170

Total 2010 482,467 - 66,219 20,309 568,995

Total 2009 495,197 - 82,377 77,500 655,074

• No retirement benefits or other benefits were paid to Key Management Personnel or Specified Executives during the financial years ended 30 June 2010 or 30 June 2009.

• No portion of KMP/Executive remuneration related to performance during the current or prior period.

• There were no options and rights issued as remuneration during the period. A detailed reconciliation of options held by key management personnel can be found in Note 27 to the Financial Statements.

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Corporate Governance Statement

The Board of Directors of JV Global Limited is responsible for the corporate governance of the consolidated entity. The Board guides and monitors the business and affairs of JV Global Limited on behalf of the shareholders by whom they are elected and to whom they are accountable. Details of the Consolidated Entity’s Corporate Governance policies can be found at http://www.jvglobal.com.au/Investor_Corporate.asp.

JV Global Limited’s Corporate Governance Statement is structured with reference to the Corporate Governance Council’s principles and recommendations, which are as follows:

Introduction

The Board of Directors is responsible for the Corporate Governance of JV Global Limited and its controlled entities (referred to in this document as “the Consolidated Entity”). The Directors are focused on fulfilling their responsibilities individually and as a Board to all of the Consolidated Entity’s stakeholders. This involves recognition of and a need to adopt principles of good corporate governance. The Board supports the guidelines on the “Principles of Good Corporate Governance and Best Practice Recommendations” established by the ASX Corporate Governance Council.

Given the size and structure of the Consolidated Entity and the cost of strict compliance with all of the recommendations, the Consolidated Entity has adopted some modified systems, procedures and practices which it considers allows it to meet the principles of good corporate governance.

At the end of this Corporate Governance Statement there is a table detailing the recommendations with which the Consolidated Entity does not strictly comply. A description of the Consolidated Entity’s practices in complying with the principles is set out below. Principle 1: Laying Solid Foundations for Management and Oversight.

The role of the Board is to lead and oversee the management and direction of the Company and its controlled entities. The Board’s roles include: - Defining and setting the business objectives and corporate mission; - Devising strategies to achieve objectives and monitoring performance towards the objectives; - Overseeing compliance with corporate policies and laws, taking responsibility for risk management and reviewing executive

management of the Consolidated Entity; - Monitoring and approving business tactics, financial performance, and available resources; - Maintaining liaison with the Consolidated Entity’s auditor; and - Reporting to Shareholders.

Principle 2: Structure the Board to Add Value.

The recommendations of the Corporate Governance Council are that the composition of the Board be determined so as to provide the Consolidated Entity with a broad base of industry, business, technical, administrative and corporate skill and experience considered necessary to represent Shareholders and fulfil the business objectives of the Consolidated Entity.

The recommendations of best practice are that the majority of the Directors and in particular the chairperson should be independent. An independent director is one who:

- does not hold an executive position;

- is not a substantial shareholder of the Company or an officer of, or otherwise associated directly with, a substantial shareholder of the Company;

- has not within the last three years been employed in an executive capacity by the Company or its subsidiaries, or been a director after ceasing to hold any such employment;

- is not a principal of a significant professional adviser or a significant consultant of the Company or its subsidiaries, or an employee materially associated with the service provided;

- is not a significant supplier or customer of the Company or its subsidiaries, or an officer of, or otherwise associated directly or indirectly with a significant supplier or customer;

- has no significant contractual relationship with the Company or its subsidiaries other than as a Director of the Company; and

- Is free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere with the Director’s ability to act in the best interests of the Consolidated Entity.

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Corporate Governance Statement continued

Individual board members do not fulfil all of these criteria but the overall profile of the Board is considered the most appropriate for the activities of the Consolidated Entity. Details of the members of the Board, their experience, expertise, qualifications, term of office and independent status are set out in the Directors’ Report.

Materiality thresholds in determining the independence of non-executive directors are:

- A relationship that accounts for more than 10% of the Director’s gross income (other than director’s fees paid by the Consolidated Entity).

- Where the relationship is with a firm, company or entity, in respect of which the Director (or any associate) has more than a 20% shareholding if a private company or 2% if a listed company.

Mr Opie is Managing Director and a substantial shareholder in JV Global Limited. The Board has determined that Mr Opie is not an independent director.

Mr Vost is considered by the Board to not have any relationship or interest that may affect his independence and the Board considers Mr Vost to be a non-executive independent director.

Mr Arrigoni is considered by the Board to not have any relationship or interest that may affect his independence and the Board considers Mr Arrigoni to be a non-executive independent director.

Term of Office The Consolidated Entity’s Constitution specifies that at the annual general meeting each year, one third of the Directors (with certain exceptions, including the Managing Director) must retire from office. Independent Professional Advice Directors and Board Committees have the right, in connection with their duties and responsibilities as Directors, to seek independent professional advice at the Consolidated Entity’s expense. Prior written approval of the Chairman is required, and this will not be unreasonably withheld. Board Committees

Nomination Committee The Consolidated Entity does not have a Nomination Committee. The full Board undertakes the role of reviewing Board membership. Remuneration Committee The Consolidated Entity does not have a Remuneration Committee. The full Board undertakes the role of reviewing remuneration of executives and directors. Audit Committee

The Consolidated Entity established an audit committee on 26 August 2005. The Audit Committee operates in accordance with Principle 4 of the Principles of Good Corporate Governance and Best Practice Recommendations. The main responsibilities of the Audit Committee are to:

- Review, assess and approve the annual report, the half year financial report and all other financial information published by the Consolidated Entity or released to the market.

- Review the effectiveness of the Consolidated Entity’s internal control environment, including the effectiveness and efficiency of operations, the reliability of financial reporting and compliance with applicable laws and regulations.

- Oversee the effective operation of the risk management framework

- Recommend the appointment, removal and remuneration of the external Auditor, and review the terms of their engagement, the scope and quality of their audit and assess their performance.

- Consider the independence and competence of the external Auditor on an ongoing basis.

- Review and monitor related party transactions and assess their propriety.

- Report on matters relevant to the committee’s role and responsibilities.

Principle 3: Promotion of Ethical and Responsible Decision-Making.

Directors, officers, employees and consultants to the Consolidated Entity are required to observe high standards of behaviour and business ethics on behalf of the Consolidated Entity and they are required to maintain a reputation of integrity on the part of both the Consolidated Entity and themselves. The Consolidated Entity does not contract with or otherwise engage any person or party where it considers integrity may be compromised.

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Directors are required to disclose to the Board actual or potential conflicts of interest that may or might reasonably be thought to exist between the interests of the director or the interests of any other party in so far as it affects the activities of the Consolidated Entity and to act in accordance with the Corporations Act 2001 if conflict cannot be removed or if it persists. That involves taking no part in the decision making process or discussions where that conflict does arise.

Directors are required to make disclosure of any share trading. The Consolidated Entity’s policy in relation to share trading is that Directors and senior management are prohibited to trade while in possession of unpublished price sensitive information.

Price sensitive information is information that a reasonable person would expect to have a material affect on the price or value of the Company’s shares. It is a recommendation that an officer discuss the proposal to acquire or sell shares with the Chairman or the Company Secretary prior to doing so to ensure that there is no price sensitive information of which that officer might not be aware. The undertaking of any trading in shares must be notified to the Company Secretary who makes disclosure to the ASX.

Principle 4: Safeguard Integrity in Financial Reporting.

The audit committee is expected to play an active role in monitoring the affairs of the Consolidated Entity. The Directors are also required to monitor the activities of the Consolidated Entity to ensure compliance with the ASX’s Continuous Disclosure requirements. The Chief Executive Officer and the Chief Financial Officer state in writing to the Board that the Consolidated Entity’s financial reports present a true and fair view, in all material respects, of the Consolidated Entity’s financial condition and operational results and are in accord with relevant accounting standards.

Each member of the Board has access to the external Auditor and the Auditor has access to each Board member.

Principle 5: Make Timely and Balanced Disclosure.

The Company Secretary is the person responsible for overseeing and co-ordinating the disclosure of information to the ASX as well as communication with the ASX. This involves compliance with the Continuous Disclosure requirements of the Listing Rules. Principle 6: Respect the Rights of Shareholders.

The Board’s fundamental responsibility to Shareholders is to work towards meeting the Consolidated Entity objectives so as to add value. The Board seeks to inform Shareholders of all major developments affecting the Consolidated Entity by:

- Preparing half yearly and yearly financial reports;

- Making announcements in accordance with the Listing Rules and the Continuous Disclosure obligations;

- Annually, and more regularly if required, holding a general meeting of Shareholders and forwarding to them the annual report together with notice of meeting and proxy form.

The Annual General Meeting enables Shareholders to receive reports and participate in the meeting by attendance or by written communication. The Board seeks to inform all Shareholders so they can be fully informed annually for the appointment of Directors and so as to enable them to have discussion at the Annual General Meeting with the Directors and/or the Auditor of the Consolidated Entity who will attend the Annual General Meeting.

Principle 7: Recognise and Manage Risk.

The Board is conscious of the need to continually maintain systems of risk management and controls in order to manage all of the assets and affairs of the Consolidated Entity.

It is the policy of the Consolidated Entity that all operations are conducted as far as reasonably practicable in a manner that is conducive to:

- The health and safety of all employees, consumers, customers, visitors to our sites and others who may be affected by the Consolidated Entity’s operations;

- Compliance with all applicable legislation;

- Protection of assets and earning capacity against loss, and where possible enhancement of profitability and growth of assets;

- Entering contracts when the Consolidated Entity has the technical and financial capability to deliver on time and on budget;

- Protection of the environment.

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In conjunction with the Certification of Financial Reports under Principle 4, the Managing Director and Chief Executive Officer and Chief Financial Officer state in writing to the Board each reporting period that:

- The statement given in accordance with Principle 7 is founded on a sound system of risk management and internal control which implements the policies adopted by the Board; and

- The Combined Consolidated Entity’s risk management and internal compliance and control system is operating efficiently and effectively in all material respects.

Principle 8: Remunerate Fairly and Responsibly.

No director receives any performance based remuneration and nor do any of them have contracts with the Consolidated Entity that give them any form of certain tenure. Directors must seek re-election by Shareholders every three years, with the exception of the Managing Director.

Each member of the Board has committed to spending sufficient time to enable them to carry out their duties as a Director of the Consolidated Entity.

A maximum amount of remuneration for non-executive Directors is fixed by Shareholders in general meeting and can be varied in the same manner. In determining the allocation (if any) the Board must take account of the time demands on the Directors together with such factors as fees paid to other corporate directors and to the responsibility undertaken by them. There has been no equity based executive remuneration.

Departures from the Recommendations of the ASX Corporate Governance Council

Recommendation Number

Departure from Recommendation

Explanation for Departure

2.1 Three of the four Directors of the Consolidated Entity do not satisfy all of the tests of independence.

Each of the Directors is aware of and capable of acting in an independent manner and in the best interests of all Shareholders. Given the nature and size of the Consolidated Entity and its business interests, the Board is of the view that it has a broad mix of required skills and relevant experience.

2.4 A separate Nomination Committee has not been formed.

The role of the Nomination Committee is carried out by the full Board. The Board considers that, given its size, no efficiencies or other benefits would be gained by establishing a separate Nomination Committee.

4.3 There is no formal audit committee

The Company does not presently operate an audit committee because the Company is not of a size, nor are its financial affairs of such complexity, to justify separate committees of the Board. This is considered appropriate at the current stage of the Company’s level of activities.

8.1 There is no written process for performance evaluation of the Board, committees, individual Directors and key executives.

The Directors monitor, review and discuss the performance of the key executives and implement changes where necessary. The Board subscribes to Principle 8 and is developing procedures to comply with the Recommendations flowing from it.

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Grant Thornton Audit Pty Ltd ABN 94 269 609 023 10 Kings Park Road West Perth WA 6005 PO Box 570 West Perth WA 6872

T +61 8 9480 2000

F +61 8 9322 7787

E [email protected]

W www.grantthornton.com.au

15

Grant Thornton Australia Limited is a member firm within Grant Thornton International Ltd. Grant Thornton International Ltd and the member firms are not a worldwide partnership. Grant Thornton Australia Limited, together

with its subsidiaries and related entities, delivers its services independently in Australia.

Liability limited by a scheme approved under Professional Standards Legislation

Auditor’s Independence Declaration

To the Directors of JV Global Limited

In accordance with the requirements of section 307C of the Corporations Act 2001, as lead

auditor for the audit of JV Global Limited for the year ended 30 June 2010, I declare that, to

the best of my knowledge and belief, there have been:

a no contraventions of the auditor independence requirements of the Corporations Act

2001 in relation to the audit; and

b no contraventions of any applicable code of professional conduct in relation to the

audit.

GRANT THORNTON AUDIT PTY LTD Chartered Accountants

P W Warr

Director - Audit & Assurance

Perth, 30 September 2010

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Consolidated Statement of Comprehensive Income

FOR THE YEAR ENDED 30 JUNE 2010

Consolidated

2010 2009

Note $ $

Revenue 3,564,592 4,821,570

Rendering of Services - 43,435

Gains on Foreign Exchange - 110,238

Materials used in Production (1,782,296) (2,609,489)

Changes in Inventory of Finished Goods 25,242 (180,922)

Employee Benefits Expense 5(a) (1,834,895) (2,773,976)

Employee Share Options (66,219) (82,377)

Administration Expenses 5(c) (1,088,492) (834,221)

Depreciation Expense 5(b) (106,578) (109,027)

Loss on Revaluation of Financial Assets (4,100) -

Loss on Foreign Exchange (113,150) -

Impairment Expenses 5(d) (981,358) (3,836,696)

(2,387,254) (5,451,465)

Finance Income 2,258 17,294

Finance Costs 5(e) (40,228) (170,926)

Net Finance Costs (37,970) (153,632)

Share of Loss from Equity Accounted Investees 15(a) - (233,903)

Loss before Income Tax (2,425,224) (5,839,000)

Income Tax (Expense)/Income 7 - -

Loss for the Year (2,425,224) (5,839,000)

Other Comprehensive Income/(Loss) - -

Total Comprehensive Loss for the period (2,425,224) (5,839,000)

Earnings per share (cents per share) 8

- basic (1.17) (7.71)

- diluted (1.17) (7.71)

The above financial accounts should be read in conjunction with the accompanying notes

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Consolidated Statement of Financial Position

AS AT 30 JUNE 2010

Consolidated

2010 2009

Note $ $

Assets

Current Assets

Cash and Cash Equivalents 9 143,437 20,177

Trade and Other Receivables 10 14,825 470,107

Inventories 11 60,763 110,332

Prepayments 48,480 95,008

Other Current Assets 12 6,607 71,706

Financial Assets 13 4,000 -

Total Current Assets 278,112 767,330

Non-Current Assets

Investments in Associates 15 - -

Plant and Equipment 16 153,587 378,030

Deferred Tax Assets 21 66,664 66,664

Intangible Assets 17 - 600,127

Total Non-Current Assets 220,251 1,044,821

Total assets 498,363 1,812,151

Liabilities

Current Liabilities

Trade and Other Payables 19 979,421 1,313,434

Financial Liabilities 20 2,060,816 1,853,727

Provisions 22 67,575 118,427

Total current liabilities 3,107,812 3,285,588

Non-Current Liabilities

Financial Liabilities 20 49,171 100,218

Provisions 22 20,426 38,946

Deferred Tax Liabilities 21 19,776 19,776

Total Non-Current Liabilities 89,373 158,940

Total Liabilities 3,197,185 3,444,528

Net Deficiency (2,698,822) (1,632,377)

Equity

Issued Capital 23 20,748,709 19,525,856

Reserves 523,378 387,452

Accumulated Losses (23,970,909) (21,545,685)

Total Deficiency (2,698,822) (1,632,377)


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Consolidated Statement of Changes in Equity


Issued Capital Retained Earnings

Share Option Reserve

Total

CONSOLIDATED $ $ $ $

Balance as at 1 July 2008 19,525,856 (15,706,685) 305,075 4,124,246

Total Comprehensive Loss for the Year - (5,839,000) - (5,839,000)

19,525,856 (21,545,685) 305,075 (1,714,754)

Employee Option Expense - - 82,377 82,377

Balance as at 30 June 2009 19,525,856 (21,545,685) 387,452 (1,632,377)

Balance as at 1 July 2009 19,525,856 (21,545,685) 387,452 (1,632,377)

Total Comprehensive Loss for the Year - (2,425,224) - (2,425,224)

19,525,856 (23,970,909) 387,452 (4,057,601)

Shares Issued during the Year 1,498,500 - 1,498,500

Share Issue Costs (275,647) - 69,707 (205,940)

Employee Option Expense - - 66,219 66,219

Balance as at 30 June 2010 20,748,709 (23,970,909) 523,378 (2,698,822)


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Consolidated Statement of Cash Flows


Note CONSOLIDATED

2010 2009

$ $

Cash Flow from Operating Activities

Receipts from Customers 3,617,651 4,887,422

Payments to Suppliers and Employees (5,010,169) (5,516,286)

Finance Costs (74,305) (125,993)

Net Cash Flows used in Operating Activities 9(b) (1,466,823) (754,857)

Cash Flows from Investing Activities

Interest Received 2,258 17,294

Proceeds from Sale of Plant and Equipment 2,700 5,000

Purchase of Plant and Equipment (92,228) (80,733)

Advances to Associates - (43,405)

Repayments from Associates 236,850 -

Purchase of financial assets (8,100) -

Net Cash Flows Provided By/(Used In) Investing Activities 141,480 (101,844)

Cash Flows from Financing Activities

Proceeds from Issue of Shares 1,398,500 -

Share issue costs (105,941) -

Proceeds from Borrowings 200,000 115,000

Repayment of Borrowings (161,622) (118,956)

Net Cash Flows Provided By/(Used In) Financing Activities 1,330,937 (3,956)

Net Increase/(Decrease) in Cash and Cash Equivalents 5,594 (860,657)

Cash at Beginning of the Financial Year (151,926) 708,731

Cash and Cash Equivalents at End of the Financial Year 9(a) (146,332) (151,926)


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Notes to the Financial Statements


1 CORPORATE INFORMATION

JV Global Limited is a public company registered in Western Australia with its registered office at Shop 12 “South Shore Piazza” 85 South Perth Esplanade, South Perth, Western Australia. The financial report of JV Global Limited for the year ended 30 June 2010 was authorised for issue in accordance with a resolution of the directors on 30 September 2010.

JV Global Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the Australian stock exchange. The nature of the operations and principal activities of the Consolidated Entity are described in the Directors Report.

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of Preparation

The financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001.

Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report containing relevant and reliable information about transactions, events and conditions. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting Standards. Material accounting policies adopted in the preparation of this financial report are presented below and have been consistently applied unless otherwise stated.

The financial report has been prepared on an accruals basis and is based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.

(b) Basis of Consolidation

A controlled entity is any entity over which JV Global Limited has the power to govern the financial and operating policies so as to obtain benefits from its activities. In assessing the power to govern, the existence and effect of holdings of actual and potential voting rights are considered.

A list of controlled entities is contained in Note 14 to the financial statements.

As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated financial statements as well as their results for the year then ended. Where controlled entities have entered (left) the consolidated entity during the year, their operating results have been included (excluded) from the date control was obtained (ceased).

All inter-group balances and transactions between entities in the consolidated entity, including any unrealised profits or losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with those adopted by the parent entity.

(c) Income Tax

The income tax expense (revenue) for the year comprises current income tax expense (income) and deferred tax expense (income).

Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using applicable income tax rates enacted, or substantially enacted, as at reporting date. Current tax liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.

Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year as well unused tax losses.

Current and deferred income tax expense (income) is charged or credited directly to equity instead of the profit or loss when the tax relates to items that are credited or charged directly to equity.

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Notes to the Financial Statements continued


2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued

(c) Income Tax continued

Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where amounts have been fully expensed but future tax deductions are available. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.

Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at reporting date. Their measurement also reflects the manner in which management expects to recover or settle the carrying amount of the related asset or liability.

Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is probable that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised.

Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference can be controlled and it is not probable that the reversal will occur in the foreseeable future.

Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled.

(d) Inventories

Inventories are measured at the lower of cost and net realisable value. Costs, including an appropriate portion of fixed and variable overhead expenses, are assigned to inventory on hand by the method most appropriate to each particular class of inventory, with the majority being valued on a first in first out basis.

(e) Plant and Equipment

Each class of property, plant and equipment is carried at cost or fair value as indicated less, where applicable, any accumulated depreciation and impairment losses.

Plant and Equipment

Plant and equipment are measured on the cost basis.

The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the asset’s employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Consolidated Entity and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the Statement of Comprehensive Income during the financial period in which they are incurred.

Depreciation

The depreciable amount of all fixed assets including buildings and capitalised lease assets, but excluding freehold land, is depreciated on a straight-line basis over the asset’s useful life to the consolidated entity commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.

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(e) Plant and Equipment continued

Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows:

• Buildings - over 20 years

• Plant and equipment - over 5 to 20 years

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

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the Statement of Comprehensive Income. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings.

(f) Leases

Leases of fixed assets, where substantially all the risks and benefits incidental to the ownership of the asset, but not the legal ownership, is transferred to entities in the consolidated entity, are classified as finance leases.

Finance leases are capitalised by recording an asset and a liability at the lower of the amounts equal to the fair value of the leased property or the present value of the minimum lease payments, including any guaranteed residual values. Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the period.

Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful lives or the lease term.

Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses in the periods in which they are incurred.

(g) Financial Instruments

Initial Recognition and Measurement

Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions to the instrument. For financial assets, this is equivalent to the date that the Consolidated Entity commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted).

Financial instruments are initially measured at fair value plus transaction costs, except where the instrument is classified ‘at fair value through profit or loss’, in which case transaction costs are expensed to profit or loss immediately.

Classification and Subsequent Measurement

Finance instruments are subsequently measured at either of fair value, amortised cost using the effective interest rate method, or cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, between knowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair value; in other circumstances, valuation techniques are adopted.

Amortised cost is calculated as:

a. the amount at which the financial asset or financial liability is measured at initial recognition;

b. less principal repayments;

c. plus or minus the cumulative amortisation of the difference, if any, between the amount initially recognised and the maturity amount calculated using the effective interest method; and

d. less any reduction for impairment

The Consolidated Entity does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the requirements of accounting standards specifically applicable to financial instruments.

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(g) Financial Instruments continued

(i) Financial Assets at Fair Value through Profit or Loss

Financial assts are classified and ‘fair value through profit or loss’ when they are held for trading for the purpose of short-term profit-taking. Such assets are measured subsequently measured at fair value with changes in carrying value being included in the Statement of Comprehensive Income.

(ii) Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost.

(iii) Available-For-Sale Financial Assets

Available-for-sale financial assets are non-derivative financial assets that are either not suitable to be classified into other categories of financial assets due to their nature, or they are designated as such by management. They comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed or determinable payments.

(iv) Financial Liabilities

Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost.

Fair Value

Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to similar instruments and option pricing models.

Impairment of Financial Assets

At each reporting date, the Consolidated Entity assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a prolonged decline in the value of the instrument is considered to determine whether an impairment has arisen. Impairment losses are recognised in the Statement of Comprehensive Income.

(h) Impairment of Non Financial Assets

At each reporting date, the Consolidated Entity reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the Statement of Comprehensive Income.

Impairment testing is performed annually for goodwill and intangible assets with indefinite lives. Where it is not possible to estimate the recoverable amount of an individual asset, the Consolidated Entity estimates the recoverable amount of the cash-generating unit to which the asset belongs. For details of the impairment review undertaken refer to Note 18.

(i) Investments in Associates

Investments in associate companies are recognised in the financial statements by applying the equity method of accounting. The equity method of accounting recognised the Consolidated Entity’s share of post-acquisition reserves of its associates.

(j) Intangibles

Goodwill

Goodwill and goodwill on consolidation are initially recorded at the amount by which the purchase price for a business combination exceeds the fair value attributed to the interest in the net fair value of identifiable assets, liabilities and contingent liabilities at date of acquisition. Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill on acquisition of associates is included in investments in associates. Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

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(k) Foreign Currency Transactions and Balances

Transactions and Balances

Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.

Exchange differences arising on the translation of monetary items are recognised in the Statement of Comprehensive Income, except where deferred in equity as a qualifying cash flow or net investment hedge.

Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity; otherwise the exchange difference is recognised in the Statement of Comprehensive Income.

(l) Employee Benefits

Provision is made for the Consolidated Entity’s liability for employee benefits arising from services rendered by employees to reporting date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits. Those cash flows are discounted using market yields on national government bonds with terms to maturity that match the expected timing of cash flows.

Equity-settled Compensation

The Consolidated Entity operates equity-settled share-based payment employee share and option schemes. The fair value of the equity to which employees become entitled is measured at grant date and recognised as an expense over the vesting period, with a corresponding increase to an equity account. The fair value of shares is ascertained as the market bid price. The fair value of options is ascertained using a Black–Scholes pricing model which incorporates all market vesting conditions. The number of shares and options expected to vest is reviewed and adjusted at each reporting date such that the amount recognised for services received as consideration for the equity instruments granted shall be based on the number of equity instruments that eventually vest.

(m) Provisions

Provisions are recognised when the Consolidated Entity has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.

(n) Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities on the Statement of Financial Position.

(o) Revenue and Other Income

Revenue is measured at the fair value of the consideration received or receivable after taking into account any trade discounts and volume rebates allowed. Any consideration deferred is treated as the provision of finance and is discounted at a rate of interest that is generally accepted in the market for similar arrangements. The difference between the amount initially recognised and the amount ultimately received is interest revenue.

Revenue from the sale of goods is recognised at the point of delivery as this corresponds to the transfer of significant risks and rewards of ownership of the goods and the cessation of all involvement in those goods.

Interest revenue is recognised using the effective interest rate method, which, for floating rate financial assets, is the rate inherent in the instrument. Dividend revenue is recognised when the right to receive a dividend has been established.

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(o) Revenue and Other Income continued

Revenue recognition relating to the provision of services is determined with reference to the stage of completion of the transaction at reporting date and where outcome of the contract can be estimated reliably. Stage of completion is determined with reference to the services performed to date as a percentage of total anticipated services to be performed. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent that related expenditure is recoverable.

All revenue is stated net of the amount of goods and services tax (GST).

(p) Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

All other borrowing costs are recognised in income in the period in which they are incurred.

(q) Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the Statement of Financial Position are shown inclusive of GST.

Cash flows are presented in the Statement of Cash Flows on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

(r) Comparative Figures

When required by accounting standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.

(s) Critical Accounting Estimates and Judgements

The directors evaluate estimates and judgments incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Consolidated Entity.

Key Estimates

(i) Impairment of Non-Financial Assets

The Consolidated Entity assesses impairment at each reporting date by evaluating conditions and events specific to the Consolidated Entity that may be indicative of impairment triggers. Recoverable amounts of relevant assets are reassessed using value-in-use calculations which incorporate various key assumptions which have been disclosed at Note 18. An amount of $981,358 has been recognised in the Statement of Comprehensive Income

(ii) Share-based Payment Transactions

The Consolidated Entity measures the cost of equity-settled transactions with suppliers by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined using a Black-Scholes model. The assumptions used in the valuation of share based transactions are discussed in Note 28.

(iii) Estimation of Useful Lives of Assets

The estimation of the useful lives of assets has been based on historical experience as well as manufacturers’ warranties (for plant and equipment), lease terms (for leased equipment) and turnover policies (for motor vehicles). In addition, the condition of assets is assessed at least once per year and considered against the remaining useful life. Adjustments to useful lives are made when considered necessary.

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(t) Going Concern

Notwithstanding the appointment on 13 July 2010 of the Voluntary Administrator to the subsidiary company JVG Framing Pty Ltd (trading as Component Homes), the financial statements have been prepared on the basis of going concern which contemplates the continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business.

During the 2010 financial year the consolidated entity made a loss of $2,425,224 (2009: $5,839,000), which included an impairment of goodwill and other assets of $981,358 (2009: $3,836,696) and at reporting date had a net asset deficiency of $2,698,822 (2009: $1,632,377).

As described in the Directors’ Report, the current and past economic environment has been challenging for your company and its Directors. The directors are currently assisting the Voluntary Administrator in seeking a satisfactory outcome for Component Homes in relation to the net result to JV Global Ltd. The Board has committed to undertake a further capital raising to revitalise the Consolidated Entity and seek new projects or ventures including a possible diversification, one of which has been concluded as described below

Further the future of the subsidiary company, JVG Framing Pty Ltd is currently under consideration whilst segments of the business operated by the subsidiary are currently being sold. Negotiations are being held with the purchaser of some of the assets for the potential use of the Trading Name, the website and some other aspects of the business. JV Global Ltd would then be able to earn fees and income by referrals of business to the purchaser in line with the other arrangements in place as outlined further herein, and being negotiated with other parties both nationally and internationally.

The Board are of the view that at this stage there will be minimal financial impact on the parent company as a result of the final resolutions in regard to Component Homes, in fact the net result will be a consolidated group going forward without the ongoing financial burden of large staffing numbers, commercial premises and large capital expenditure requirements, allowing a prudent and organic growth under our new business model.

Whilst parts of the assets have been sold and others are being negotiated it is apparent that the ongoing operations in this division, as mentioned will be substantially reduced as will the financial exposure by JV Global Ltd going forward by way of large staffing costs and capital exposure for premises and Plant & Equipment.

Indeed JV Global Ltd have recently announced a Heads of Agreement Joint Venture with an experienced Steel frame home and commercial builder “Steelhomes” in Western Australia which is directly in line with the current activities of JV Global and whilst creating multiple synergies also allows JV Global to expand its current activities. This agreement allows JV Global to outsource their production of all and any sales to “Steelhomes” on a mutually agreed fee basis, dependant on the size and nature of the projects, and also provides JV Global Ltd with access to a Builders licence in Western Australia, which previously restricted their activities and style of projects they could tender on.

The Board have recently held discussions with the Convertible Note Holders who have agreed to extend the expiry date of the notes to 30 June 2011 and waive any interest payments which have been accrued. The extension to 30 June 2011 is conditional upon the Groups financiers not calling the secured loan against the guarantee of Company for the subsidiary’s liability and allowing the Company to meet any shortfall pending the outcome of the activities of the Voluntary Administrator.

The Board have also held preliminary discussions with the financiers regarding pre-emptive actions that may be taken with regards to any shortfall of funds owing to the financiers pending the outcome of the activities of the Voluntary Administrator. Further, we confirm that the bank has not withdrawn its facilities and/or requested payment for its loan facilities at this date.

Whilst acknowledging the material uncertainties applicable to this entity as listed above, the directors consider the going concern assumption to be appropriate for the following reasons:

• Written agreements are in place with the Convertible Note Holders to extend the expiry date of the notes to 30 June 2011 and the interest payments which have been accrued to date will be waived;

• There is pre emptive support from major shareholders for the soon to be announced capital raising programme;

• A possible conversion of the convertible note debt into a special class of shares; and

• The Board continues to receive approaches from numerous parties with ventures within and outside of the existing business sector seeking to either merge or become involved with the parent company.

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(t) Going Concern continued

The directors have concluded that the combination of these circumstances represent a material uncertainty that casts doubt upon the Consolidated Entity’s ability to continue as a going concern and whether it will realise its assets and extinguish its liabilities in the normal course of business and at the amounts stated in the financial report.

Pending the outcome of the Voluntary Administrators assessment, the successful completion of the proposed capital raising noted above and successful negotiations with the Consolidated Entity’s Bankers, and considering the opportunities described above the directors have a reasonable expectation that the Consolidated Entity will have adequate resources to continue in operational existence for the foreseeable future. For these reasons they continue to adopt the going concern basis in preparing the annual report and accounts.

(u) Adoption of New and Revised Accounting Standards

During the current year the Consolidated Entity adopted all of the new and revised Australian Accounting Standards and Interpretations applicable to its operations which became mandatory. The adoption of these standards has impacted the recognition, measurement and disclosure of certain transactions. The following is an explanation of the impact the adoption of these standards and interpretations has had on the financial statements of the consolidated entity.

AASB 8: Operating Segments

In February 2007 the Australian Accounting Standards Board issued AASB 8 which replaced AASB 114: Segment Reporting. As a result, some of the required operating segment disclosures have changed with the addition of a possible impact on the impairment testing of goodwill allocated to the cash generating units (CGUs) of the entity. Below is an overview of the key changes and the impact on the Consolidated Entity’s financial statements.

Measurement impact

Identification and measurement of segments - AASB 8 requires the ‘management approach’ to the identification measurement and disclosure of operating segments. The ‘management approach’ requires that operating segments be identified on the basis of internal reports that are regularly reviewed by the entity’s chief operating decision maker, for the purpose of allocating resources and assessing performance. This could also include the identification of operating segments which sell primarily or exclusively to other internal operating segments. Under AASB 114, segments were identified by business and geographical areas, and only segments deriving revenue from external sources were considered. The adoption of the ‘management approach’ to segment reporting has resulted in the identification of reportable segments largely consistent with the prior year.

Under AASB 8, operating segments are determined based on management reports using the ‘management approach’, whereas under AASB 114 financial results of such segments were recognised and measured in accordance with Australian Accounting Standards. This has resulted in changes to the presentation of segment results, with intersegment sales and expenses such as depreciation and impairment now being reported for each segment rather than in aggregate for the total Consolidated Entity operations, as this is how they are reviewed by the chief operating decision maker.

Disclosure impact

AASB 8 requires a number of additional quantitative and qualitative disclosures, not previously required under AASB 114, where such information is utilised by the chief operating decision maker. This information is now disclosed as part of the financial statements.

AASB 101: Presentation of Financial Statements

In September 2007 the Australian Accounting Standards Board revised AASB 101 and as a result, there have been changes to the presentation and disclosure of certain information within the financial statements. Below is an overview of the key changes and the impact on the Consolidated Entity’s financial statements.

Disclosure impact

Terminology changes - the revised version of AASB 101 contains a number of terminology changes, including the

amendment of the names of the primary financial statements.

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(u) Adoption of New and Revised Accounting Standards continued

Reporting changes in equity - the revised AASB 101 requires all changes in equity arising from transactions with owners, in their capacity as owners, to be presented separately from non-owner changes in equity. Owner changes in equity are to be presented in the statement of changes in equity, with non-owner changes in equity presented in the statement of comprehensive income. The previous version of AASB 101 required that owner changes in equity and other comprehensive income be presented in the statement of changes in equity.

Statement of comprehensive income - the revised AASB 101 requires all income and expenses to be presented in either one statement, the statement of comprehensive income, or two statements, a separate income statement and a statement of comprehensive income. The previous version of AASB 101 required only the presentation of a single income statement. The Consolidated Entity’s financial statements now contain a statement of comprehensive income.

Other comprehensive income - the revised version of AASB 101 introduces the concept of ‘other comprehensive income’ which comprises of income and expenses that are not recognised in profit or loss as required by other Australian Accounting Standards. Items of other comprehensive income are to be disclosed in the statement of comprehensive income. Entities are required to disclose the income tax relating to each component of other comprehensive income. The previous version of AASB 101 did not contain an equivalent concept.

(v) Summary Of Accounting Standards Issued Not Yet Effective

The following new Accounting Standards and Interpretations (which have been released but not yet adopted) have no material impact on the Consolidated Entity’s financial statements or the associated notes therein.

AASB reference Title and Affected

Standard(s)

Nature of Change Operative for

Reporting Periods beginning on/after

AASB 2009-5 Further Amendments to Australian Accounting

Standards arising from the Annual Improvements Process

Changes to AIFRSs as a result of the IASB’s 2008 annual improvement process. 1 January 2010

AASB 2009-8 Amendments to Australian Accounting Standards - Group Cash-settled Share-based

Payment Transactions

Clarifies the scope and accounting for group cash-settled share-based payment transactions in the individual financial statements of an entity receiving the goods/services when that entity has no obligation to settle the share-based payment

transaction.

1 January 2010

AASB 9

AASB 2009-11

Financial Instruments

Amendments to Australian

Accounting Standards arising from AASB 9

Amends the requirements for classification and measurement of financial assets.

AASB 9 introduces new requirements for the classification and measurement of

financial assets. AASB 9 uses a single approach to determine whether a financial asset is measured at amortised cost or fair value, replacing the different rules in AASB 139 and removing the impairment requirement for financial assets held at fair

value.

1 January 2013

AASB

Interpretation 19

Extinguishing Financial

Liabilities with Equity Instruments

Equity instruments issued to a creditor to extinguish all or part of a financial liability

are ‘consideration paid’ to be recognised at the fair value of the equity instruments issued, unless their fair value cannot be measured reliably, in which case they are

measured at the fair value of the debt extinguished. Any difference between the carrying amount of the financial liability extinguished and the ‘consideration paid’ is recognised in profit or loss.

1 July 2010

AASB 124

AASB 2009-12

Related Party Disclosures

Amendments to Australian Accounting Standards arising

from AASB 124

Simplifies disclosure requirements for government-related entities and clarifies the definition of a related party.

1 January 2011.

AASB 2010-04

Further Amendments to

Australian Accounting Standards arising from the Annual Improvements Project

[AASB 1, AASB 7, AASB 101, AASB 134 and Interpretation

13]

Emphasises the interaction between quantitative and qualitative AASB 7 disclosures

and the nature and extent of risks associated with financial instruments. Clarifies that an entity will present an analysis of other comprehensive income for

each component of equity, either in the statement of changes in equity or in the notes to the financial statements.

Provides guidance to illustrate how to apply disclosure principles in AASB 134 for significant events and transactions.

Clarifies that when the fair value of award credits is measured based on the value of the awards for which they could be redeemed, the amount of discounts or incentives

otherwise granted to customers not participating in the award credit scheme, is to be taken into account.

1 January 2011.

AASB 101 Presentation of Financial Statements

Clarifies that terms of a liability that could, at the option of the counterparty, result in the liability being settled by the issue of equity instruments, do not affect its

classification. This means that unless the terms of such liabilities require a transfer of cash or other assets within 12 months, they do not necessarily have to be classified as current liabilities.

1 January 2010

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3 OPERATING SEGMENTS

Identification of Reportable Segments

The Consolidated Entity has identified its operating segments based on the internal reports that are reviewed and used by the Board of Directors (chief operating decision makers) in assessing performance and determining the allocation of resources.

The Consolidated Entity is managed primarily on the basis of product category and service offerings since the diversifications of the Consolidated Entity’s operations inherently have notably different risk profiles and performance assessment criteria. Operating segments are therefore determined on the same basis.

Corporate charges are allocated to reporting segments based on the segments’ overall proportion of revenue generation within the Consolidated Entity. The Board of Directors believes this is representative of likely consumption of head office expenditure that should be used in assessing segment performance and cost recoveries.

Information on business segments

For management purposes the Consolidated Entity is divided into two major operating divisions - light gauge steel building manufacture, investments. These divisions are the basis on which the Consolidated Entity reports its primary segment information. The principle activities of these segments are:

Light Gauge Steel Building Manufacture (LGSBM)

The manufacture of light gauge steel framed housing within Australia.

Corporate The holding of equity investments in business engaged in manufacturing and sales of steel building products, together with machinery leased to those businesses.

Other operations include the global marketing and sales of CNC roll forming production lines, associated technology transfer and joint ventures for the manufacture of steel building products. These operations did not contribute to the Consolidated Entity’s results for the reporting period or the preceding year and were not reported separately in the Consolidated Entity’s management structure.

LGSBM * Corporate Total

2010 2009 2010 2009 2010 2009

Revenue $ $ $ $ $ $

External Revenues 3,564,592 4,864,146 - 185,275 3,564,592 5,049,421

Interest Revenue 157 6,086 2,101 11,208 2,258 17,294

Total Segment revenue 3,564,749 4,870,232 2,101 196,483 3,566,850 5,066,715

Reconciliation of segment revenue to consolidated revenue

Inter-segment elimination - (74,178)

Total consolidated revenue 3,566,850 4,992,537

Result

Segment loss before tax

(939,684) (604,906) (504,182) (1,397,398) (1,443,866) (2,002,304)

Reconciliation of segment results to consolidated net loss before tax

Amounts not included in segment result but reviewed by the Board:

• Impairment Expenses ** (981,358) (3,836,696)

Net loss before tax (2,425,224) (5,839,000)

* This segment covers the whole of the subsidiary JVG Framing Pty Ltd which was placed in Voluntary Administration on 13 July 2010. Refer to Note 2(t).

** The impairment expenses can all be allocated to the Light Gauge Steel Building Manufacture segment.

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3 OPERATING SEGMENTS continued

LGSBM * Corporate Total

2010 2009 2010 2009 2010 2009

$ $ $ $ $ $

Segment Assets 317,904 1,414,439 180,459 397,711 498,363 1,812,150

Segment Liabilities 1,515,457 1,424,198 1,681,728 2,020,331 3,197,185 3,444,529

Information on Geographic Segments

The Consolidated Entity’s operates in three geographical areas, the composition of each geographical segment is noted below:

Australia The manufacture of light gauge steel framed housing.

United Arab Emirates Equity investment in a business engaged in manufacturing and sales of steel building products, together with machinery leased to that business.

The Consolidated Entity’s revenue from external customers and information about its segment assets by geographical location is detailed below:

Revenue from external customers Segment assets

2010 2009 2010 2009

$ $ $ $

Australia 3,566,850 4,882,299 498,363 1,462,150

United Arab Emirates - 110,238 - 350,000

3,566,850 4,992,537 498,363 1,812,150

The Consolidated Entity has a number of customers to whom it provides both products and services. The Consolidated Entity supplies a single external customer in the Light Gauge Steel Building Manufacture segment who accounts for 18% of external revenue (2009: 5%). The next most significant customer accounts for 5% (2009: 4%) of external revenue.

4 PARENT COMPANY INFORMATION

2010 2009

$ $

Current Assets 148,925 16,177

Non-Current Assets 31,685 1,147,116

Total Assets 180,610 1,163,293

Current Liabilities 1,683,649 2,017,556

Non-Current Liabilities 2,775 2,775

Total Liabilities 1,686,424 2,020,331

Net Deficiency (1,505,814) (857,038)

Issued Capital 20,748,709 19,525,856

Reserves 523,378 387,452

Accumulated Losses (22,777,901) (20,770,346)

Total Deficiency (1,505,814) (857,038)

Loss after Income Tax (2,007,555) (2,792,332)

Other Comprehensive Income - -

Total Comprehensive Loss for the Year (2,007,555) (2,792,332)

Details of any parent company commitments and contingent liabilities and are included in Notes 25 and 26 to these Financial Statements.

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5 REVENUE AND EXPENSES

Note CONSOLIDATED

2010 2009

$ $

(a) Employee Benefits Expense

Wages and salaries 1,334,866 2,086,456

Amounts provided for employee entitlements 66,304 61,922

Other employee expenses 433,725 625,598

1,834,895 2,773,976

(b) Depreciation and Amortisation Expense

Depreciation of motor vehicles 8,622 6,875

Depreciation of plant and equipment 97,956 102,152

106,578 109,027

(c) Administration Expenses

Accounting and audit fees 79,981 60,120

Advertising and promotion 72,502 73,476

Communications 30,457 44,408

Consultant Fees 220,751 2,782

Fees and charges 19,041 25,454

Insurances 74,426 64,379

Legal fees 12,193 21,385

Rental expenses 354,047 222,524

Travel expenses 5,971 52,323

Other 219,123 267,370

1,088,492 834,221

(d) Impairment Expenses

Impairment of Goodwill 17 600,127 2,605,615

Impairment of Investments in Associates 15(a) - 223,354

Impairment of Plant & Equipment 16 263,910 -

Impairment of Receivables 10(b) 117,321 776,664

Impairment of Other Assets - 231,063

981,358 3,836,696

(e) Finance Costs

Interest Expense on Financial Liabilities:

- External 32,689 40,998

- Related Entities 7,539 129,928

40,228 170,926

(f) Cost of Sales 2,215,113 3,297,964

6 AUDITORS’ REMUNERATION

Remuneration of the auditor of the parent entity, Grant Thornton Audit Pty Ltd, for:

- Auditing or Reviewing the Financial Report 35,000 28,939

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7 INCOME TAX EXPENSE

CONSOLIDATED

2010 2009

$ $

(a) The components of tax expense comprise:

Current Tax - -

Deferred Tax - -

- -

Prima facie tax benefit on loss from ordinary activities before income tax at 30% (2009: 30%) (727,567) (1,751,700)

Tax Effect of:

- Impairment losses 294,407 1,151,009

- Share options expensed 19,866 24,713

- Share of loss from associate - 70,171

- Loss on revaluation of financial assets 1,230

- Unrealised foreign exchange gain - (33,071)

Tax losses not brought to account 412,064 538,878

Income tax attributable to the entity - -

Net deferred tax assets not brought to account, the benefits of which will only be realised if the conditions for deductibility as set out in Note 2(c) occur are approximately $2,432,149 (2009: $2,044,968).

8 EARNINGS PER SHARE

Basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the year.

Diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on the exercise of options into ordinary shares. There are no dilutive potential ordinary shares as the exercise of options to ordinary shares would have the effect of decreasing the loss per ordinary share and would therefore be non-dilutive.

The following reflects the income and share data used in the basic and diluted earnings per share computations:

CONSOLIDATED

2010 2009

$ $

Loss per share (1.17) (7.71)

Total comprehensive loss for the period (2,425,224) (5,839,000)

CONSOLIDATED

2010 2009

Num Num

Weighted Average Number of Ordinary Shares 207,349,741 75,728,235

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9 CASH AND CASH EQUIVALENTS

Note CONSOLIDATED

2010 2009

$ $

Cash at bank and in hand 138,281 15,177

Short term deposits 5,156 5,000

143,437 20,177

Cash at bank earns interest at floating rates based on daily bank deposit rates. Short-term deposits are made for varying periods of between one day and three months, depending on the immediate cash requirements of the Consolidated Entity, and earn interest at the respective short-term deposit rates. At 30 June 2010, the Consolidated Entity had stand-by borrowing facilities of $nil (2009: $91,962), and the overdraft facility was overdrawn by $6,501. The full balance of the overdraft has been reflected in Note 18.

(a) Reconciliation to Cash & Cash Equivalents

For the purposes of the Statement of Cash Flows, cash and cash equivalents comprise the following at 30 June:

Cash and cash equivalents 143,437 20,177

Bank overdrafts 20 (289,769) (172,103)

(146,332) (151,926)

(b) Reconciliation of cash flow from operations with loss after income tax

Loss after income tax (2,425,224) (5,839,000)

Cash flows excluded from loss attributable to operating activities:

- Interest received (2,258) (17,294)

Non-cash flows:

- Depreciation 106,578 109,027

- Loss on sale of plant and equipment 18,293 18,782

- Employee options 66,219 82,377

- Share in loss of associate - 233,903

- Net(gain)/loss on foreign exchange 113,150 (110,238)

- Loss on revaluation of financial assets 4,100 -

- Impairment Expenses 789,226 3,836,696

(Increase)/decrease in assets:

- Change in trade and other receivables 105,282 25,154

- Change in inventories 49,569 101,755

- Change in prepayments 46,528 (29,087)

- Change in other current assets 65,099 463

Increase/(decrease) in liabilities:

- Change in trade and other payables (334,013) 807,170

- Change in provisions and employee benefits (69,372) 25,435

Cash flow from Operations (1,466,823) (754,857)

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10 TRADE AND OTHER RECEIVABLES

Note CONSOLIDATED

2010 2009

$ $

CURRENT

Trade receivables a 132,146 120,107

Other receivables - -

Amounts receivable from:

- Associated companies - 1,126,664

Provision for impairment b (117,321) (776,664)

14,825 470,107

(a) Trade receivables are non-interest bearing and are generally on 30 to 90 day terms.

(b) Provision for impairment of receivables

During the year the Consolidated Entity incurred impairment charges of $117,321 (2009: $704,227). These are included in the Statement of Comprehensive Income.

Current trade and term receivables are non-interest bearing loans and generally on 30-day terms. Non-current trade and term receivables are assessed for recoverability based on the underlying terms of the contract. A provision for impairment is recognised when there is objective evidence that an individual trade or term receivable is impaired. These amounts have been included in them impairment expenses item.

Movement in the provision for impairment of receivables is as follows:

Opening balance 776,664 -

Amounts written off (776,664) -

Charge for the year 18 117,321 776,644

Closing balance 117,321 776,664

There are no balances within trade and other receivables that contain assets that are not impaired and are past due. It is expected these balances will be received when due. Impaired assets are provided for in full, refer to Note 18.

(c) Credit Risk - Trade and Other Receivables

The Consolidated Entity has no significant concentration of credit risk with respect to any single counter party or group of counter parties other than those receivables specifically provided for and mentioned within Note 10. The class of assets described as Trade and Other Receivables is considered to be the main source of credit risk related to the Consolidated Entity.

The following table details the Consolidated Entity’s trade and other receivables exposed to credit risk (prior to collateral and other credit enhancements) with ageing analysis and impairment provided for thereon. Amounts are considered as ‘past due’ when the debt has not been settled, with the terms and conditions agreed between the Consolidated Entity and the customer or counter party to the transaction. Receivables that are past due are assessed for impairment by ascertaining solvency of the debtors and are provided for where there are specific circumstances indicating that the debt may not be fully repaid to the Consolidated Entity.

The balances of receivables that remain within initial trade terms (as detailed in the table) are considered to be of high credit quality. F

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10 TRADE AND OTHER RECEIVABLES continued

Gross amount

Past due and

impaired Past due but not impaired

(days overdue) Within trade

terms

< 30 31-60 61-90 > 90

CONSOLIDATED $ $ $ $ $ $ $

2010

Trade receivables 132,146 117,321 - - - - 14,825

Other receivables - - - - - - -

132,146 117,321 - - - - 14,825

2009

Trade receivables 120,107 - - 19,384 3,624 27,260 69,839

Other receivables 1,126,664 776,664 - - - - 350,000

1,246,771 776,664 - 19,384 3,624 27,260 419,839

11 INVENTORIES

Note CONSOLIDATED

2010 2009

$ $

Raw materials and stores 135,574 110,332

Provision for impairment 18 (74,811) -

60,763 110,332

12 OTHER CURRENT ASSETS

Unearned income - 57,944

Other current assets 6,607 13,762

6,607 71,706

13 FINANCIAL ASSETS

Available-for-sale financial assets a 4,000 -

4,000 -

(a) Available-for-sale financial assets comprise:

Listed investments, at fair value

- Shares in other corporations at cost 8,100 -

- Revaluation (4,100) -

4,000 -

All financial assets held at fair value through profit or loss were designated as such upon initial recognition. Changes in fair value of financial assts held at fair value through profit or loss are recorded as income or expenditure in the Statement of Comprehensive Income. The fair value of listed shares has been determined directly by reference to published price quotations in an active market.

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14 CONTROLLED ENTITIES

(a) Controlled entities consolidated

Percentage owned (%)

Subsidiaries of JV Global Limited: Country of

incorporation 2010 2009

JV Global Australia Pty Ltd Australia 100 100

JV International Pty Ltd Australia 100 100

JVG Framing Pty Ltd Australia 100 100

JVG Contracting Pty Ltd Australia 100 100

15 ASSOCIATED COMPANIES

Ownership Interest (%) Carrying amount of

investment

Country of

incorporation 2010 2009 2010 2009

Arabian Profile Global LLC United Arab Emirates 46 46 - -

Sharus Steel Products Pvt Ltd India 40 40 - -

Arabian Profile Global LLC is incorporated in United Arab Emirates and is involved in the manufacture of roll formed steel building products. As the Consolidated Entity's investment in this associate is $nil as at 30 June 2010 (30 June 2009: $nil), the Consolidated Entity has not included its share of the current year loss in the Statement of Comprehensive Income.

Sharus Steel Products Pvt Ltd is incorporated in India and is involved in the manufacture of roll formed steel building products. Sharus Steel Products Pvt Ltd commenced trading in January 2008. As the Consolidated Entity's investment in this associate is nil as at 30 June 2010 (30 June 2009: nil), the Consolidated Entity has not included its share of the current year loss in the Statement of Comprehensive Income.

Associates’ reporting periods are controlled by their countries of incorporation and their reporting periods vary from those adopted by Australian authorities. There were no impairment losses relating to an investment in an associate and no capital commitments relating to an associate.

(a) Movements during the year in equity accounted investments in Associated Companies

CONSOLIDATED

2010 2009

$ $

Opening balance - 457,257

Share of associated company’s loss after income tax - (233,903)

Provision for impairment - (223,354)

- -

16 PLANT AND EQUIPMENT

Plant and equipment:

At cost 613,986 552,306

Accumulated depreciation (271,300) (174,276)

Impairment (189,099) -

153,587 378,030

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16 PLANT AND EQUIPMENT continued

Note CONSOLIDATED

2010 2009

$ $

(a) Movements in carrying amounts

PLANT AND EQUIPMENT

Opening balance 378,030 970,161

Additions 92,228 80,733

Disposals (20,994) (23,781)

Transfer to associated company - (540,056)

Impairment 18 (189,099) -

Depreciation expense (106,578) (109,027)

Closing balance 153,587 378,030

17 INTANGIBLE ASSETS

Goodwill

At cost 600,127 5,936,922

Accumulated impairment (600,127) (5,336,795)

- 600,127

GOODWILL

Opening balance 600,127 3,205,742

Additions - -

Impairment 18 (600,127) (2,605,615)

Closing balance - 600,127

Impairment Disclosure

Goodwill is allocated to cash-generating units as below:

Steel framed housing CGU - 600,127

Joint Venture CGU - -

- 600,127

The Consolidated Entity tests goodwill annually for impairment or more frequently if there are indications that goodwill might be impaired. In accordance with AASB 136: Impairment of Assets, the Consolidated Entity performed its goodwill impairment test by comparing the recoverable amount of each CGU with its carrying amount, including goodwill. For details of the impairment review undertaken refer to Note 18.

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18 IMPAIRMENT OF NON-FINANCIAL ASSETS

On 13 July 2010 a Voluntary Administrator was appointed to the subsidiary company JVG Framing Pty Ltd t/as Component Homes. This event was assessed by the Directors of the Consolidated Entity to be an indicator of impairment for the assets of the Steel Framed Housing CGU.

As a result an impairment review was undertaken by the Directors, with key focus on the potential resolution of the issues affecting Component Homes, including the potential sale of its assets.

The recoverable amount of the CGU was determined based on a number of factors including:

• Cash receipts received on trade receivables subsequent to balance date; and

• Directors’ estimated sale value of inventory and plant and equipment to a comparable established business in a similar industry.

The intangible assets were assessed as unrecoverable and impaired in full.

As a result of the impairment review, the Consolidated Entity recognised a non-cash impairment expense of $981,358 (2009: $3,836,696) all of which relates to the Steel Framed Housing CGU within the Light Gauge Steel Building Manufacturing business segment and Australian geographical segment. Due to the continued adverse economic conditions the Consolidated Entity will continue to monitor its assets for possible future impairment. The expense relates to a number of assets, as detailed below:

CONSOLIDATED

2010 2009

$ $

Impairment of Goodwill 17 600,127 2,605,615

Impairment of Investments in Associates 15(a) - 223,354

Impairment of Plant & Equipment 16 263,910 -

Impairment of Receivables 10(b) 117,321 776,664

Impairment of Other Assets - 231,063

981,358 3,836,696

19 TRADE AND OTHER PAYABLES

Unsecured Liabilities

Trade payables 652,167 740,964

Payable to Key Management Personnel a 27,659 87,978

Sundry payables and accrued expenses 299,595 484,492

979,421 1,313,434

(a) Payables to Key Management Personnel represent Directors Fees accrued or payable at 30 June 2010. For

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20 FINANCIAL LIABILITIES

Note CONSOLIDATED

2010 2009

$ $

CURRENT


Lease liability 25 51,047 46,624

Amounts payable to:

- Director related entity d 200,000 115,000

251,047 161,624

Secured Liabilities

Bank overdraft a 289,769 172,103

Convertible Notes a 1,520,000 1,520,000

1,809,769 1,692,103

2,060,816 1,853,727

NON-CURRENT


Lease liability 25 49,171 100,218

49,171 100,218

(a) Total current and non-current secured liabilities:

Bank overdraft 289,769 172,103

Convertible Notes c 1,520,000 1,520,000

1,809,769 1,692,103

(b) The carrying amounts of assets that have been pledged as part of the total security are: Fixed and floating charge over the assets of JVG Framing Pty Ltd held by National Australia Bank

- Cash and Cash Equivalents 5,183 6,500

- Trade Receivables 14,825 120,107

- Inventories 60,763 110,332

- Plant and Equipment 153,587 378,030

234,358 614,969

Fixed and floating charges over the assets and undertakings of JV Global Ltd held by each of the National Australia Bank and the convertible note holders

- Cash and Cash Equivalents 138,254 13,677

- Financial Assets 4,000 -

142,254 13,677

376,612 628,646

(c) JV Global Ltd has entered into Convertible Note agreements with Kailis Consolidated Pty Ltd and SC Wong of $610,000 and $910,000 respectively. The loans are to fund working capital requirements and have an interest rate of 11.25%. The terms of the loans allow the Note Holder to convert the debt to equity through subscribing for shares at between 9 and 12 cents each at any time prior to the repayment of the loan. The loan maturity is not before 30 June 2011 however the Consolidated Entity may repay all or part of the loan prior to the maturity date. Refer Note 2(t) for further details.

(d) Borrowings from Director related entities comprise monies received from persons holding Directorships with the Consolidated Entity during the last two financial years. This may include Directors who have resigned during the two financial years.

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21 TAX

Opening Balance

Charged to Income

Charged to Equity

Closing Balance

CONSOLIDATED $ $ $ $

Deferred Tax Assets

Accrued expenses 27,083 - - 27,083

Provisions 39,581 - - 39,581

Balance as at 30 June 2009 66,664 - - 66,664

Accrued expenses 27,083 - - 27,083

Provisions 39,581 - - 39,581


Deferred Tax Liabilities

Prepayments 19,776 - - 19,776


Provisions 19,776 - - 19,776


22 PROVISIONS

CONSOLIDATED

2010 2009

CURRENT $ $

Annual Leave

Opening Balance 118,427 104,942

Additional Provisions 155,834 160,893

Amounts Used (206,686) (147,408)

Closing Balance 67,575 118,427

NON CURRENT

Long Service Leave

Opening Balance 38,946 26,995

Additional Provisions 6,061 11,951

Amounts Used (24,581) -

Closing Balance 20,426 38,946

Provision for Long Service Leave

A provision has been recognised for employee entitlements relating to long service leave. In calculating the present value of future cash flows in respect of long service leave, the probability of long service leave being taken is based on historical data.

The measurement and recognition criterion relating to employee benefits has been included in Note 2(l) to this report. For

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23 ISSUED CAPITAL

CONSOLIDATED

2010 2009

$ $

225,578,235 (2009: 75,728,235) fully paid ordinary shares 20,748,709 19,525,856

20,748,709 19,525,856

Each fully paid ordinary share carries one vote and the right to participate in dividends. Ordinary shares have no par value and the Consolidated Entity does not have a limited amount of authorised capital. CONSOLIDATED CONSOLIDATED

2010 2010 2009 2009

Num $ Num $

(a) Ordinary shares

At the beginning of the period 75,728,235 19,525,856 75,728,235 19,525,856

Shares issued during the year:

- 14 August 2009 10,000,000 100,000 - -

- 18 August 2009 122,850,000 1,228,500 - -

- 19 August 2009 17,000,000 170,000 - -

Share issue costs (275,647) -

At reporting date 225,578,235 20,748,709 75,728,235 19,525,856

(b) Options

i. For information relating to the JV Global Limited employee option plan, including details of options issued, exercised and lapsed during the financial year and the options outstanding at year end refer to Note 28 Share-based Payments.

ii. For information relating to share options issued to key management personnel during the financial year, refer to Note 28 Share-based Payments.

(c) Capital management

Management controls the capital of the Consolidated Entity in order to maintain a good debt to equity ratio, provide the shareholders with adequate returns and ensure that the Consolidated Entity can fund its operations and continue as a going concern.

The Consolidated Entity’s debt and capital includes ordinary share capital, redeemable preference shares and financial liabilities, supported by financial assets. There are no externally imposed capital requirements. Management effectively manages the Consolidated Entity’s capital by assessing the Consolidated Entity’s financial risks and adjusting its capital structure in response to changes in these risks and in the market. These responses include the management of debt levels, distributions to shareholders and share issues. There have been no changes in the strategy adopted by management to control the capital of the Consolidated Entity since the prior year. This strategy is to ensure that the Consolidated Entity’s gearing ratio remains low.

24 RESERVES

(a) Option Reserve

The option reserve records items recognised as expenses on valuation of employee share options. For

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25 CAPITAL AND LEASING COMMITMENTS

CONSOLIDATED

2010 2009

$ $

(a) Finance lease commitments

Payable - minimum lease payments

- Not later than 12 months 56,172 56,172

- Between 12 months and 5 years 51,491 107,662

- Greater than 5 years - -

Minimum lease payments 107,663 163,834

Less future finance charges (7,445) (16,992)

Present value of minimum lease payments 100,218 146,842

The finance lease on manufacturing plant and equipment, which commenced in 2007, is a 5 year lease with an option to refinance at the end. The equipment is being leased from the Bank with lease payments paid monthly in advance.

(b) Operating lease commitments

Non-cancellable operating leases contracted for but not capitalised in the financial statements

Payable - minimum lease payments

- Not later than 12 months - 103,774

- Between 12 months and 5 years - 536,312

- Greater than 5 years - -

Minimum lease payments - 640,086

The property lease is a non-cancellable lease, which commenced in 2009, is a 5 year lease with rent payable monthly in advance.

26 CONTINGENT LIABILITIES AND CONTINGENT ASSETS

As at 30 June 2010, the Directors are not aware of any contingent assets or liabilities that may affect the operations of the economic entity, the result of those operations or the state of affairs of the economic entity in subsequent financial periods.

27 INTERESTS OF KEY MANAGEMENT PERSONNEL

Refer to the Remuneration Report contained in the Directors’ Report for details of the remuneration paid or payable to each member of the Consolidated Entity’s key management personnel for the year ended 30 June 2010.

The totals of remuneration paid to Key Management Personnel of the company and the Consolidated Entity during the year are as follows:

2010 2009

$ $

Salary & Fees 482,467 495,197

Non monetary benefits 66,219 82,377

Superannuation 20,309 77,500

568,995 655,074

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27 INTERESTS OF KEY MANAGEMENT PERSONNEL continued

KEY MANAGEMENT PERSONNEL options holdings

The number of options over ordinary shares held by each Key Management Personnel of the Consolidated Entity during the financial year is as follows:

2010

Balance at beginning of

year Granted Expired Balance on resignation

Balance at end of year

Vested and exercisable

P.M. Burns 1,500,000 - - (1,500,000) - -

T.H. Opie 6,000,000 - - - 6,000,000 6,000,000

K.S. McKinnon 1,500,000 - - (1,500,000) - -

K Huston 750,000 - - (750,000) - -

M Hutson 300,000 - - (300,000) - -

10,050,000 - - (4,050,000) 6,000,000 6,000,000

2009

P.M. Burns 1,500,000 - - - 1,500,000 1,000,000

T.H. Opie 14,788,011 - (8,788,011) - 6,000,000 5,000,000

S.J. Hwang 4,275,000 - - (4,275,000) - -

K.S. McKinnon 1,712,500 - (212,500) - 1,500,000 1,000,000

J.G. Opie 903,142 - - (903,142) - -

K Huston 750,000 - - - 750,000 250,000

M Hutson 300,000 - - - 300,000 100,000

24,228,653 - (9,000,511) (5,178,142) 10,050,000 7,350,000

No options were granted or exercised during the financial year ended 30 June 2010 (2009:nil).

Key Management Personnel shareholdings

The number of ordinary shares in JV Global Limited held by each Key Management Personnel of the Consolidated Entity during the financial year is as follows:

2010

Balance at beginning of

year Balance on appointment Purchased Sold

Balance on resignation

Balance at end of year

P.M. Burns 619,690 - 2,000,000 - (2,619,690) -

T.H. Opie 12,221,974 - 2,423,094 - - 14,645,068

C Vost 50,000 - 8,525,000 - - 8,575,000

R Arrigoni 675,000 - 600,000 - - 1,275,000

13,566,664 - 13,125,000 - (2,619,690) 24,071,974

2009

P.M. Burns 170,000 - 449,690 - - 619,690

T.H. Opie 8,526,974 - 3,695,000 - - 12,221,974

S.J. Hwang 4,275,000 - - - (4,275,000) -

P.G. Kailis 7,501,850 - - (1,976,850) (5,525,000) -

C Vost - 50,000 - - - 50,000

R Arrigoni - 675,000 - - - 675,000

K.S. McKinnon 223,500 - - - (223,500) -

J.G. Opie 2,403,142 - - - (2,403,142) -

23,100,466 725,000 4,144,690 (1,976,850) (12,426,642) 13,566,664

Other Key Management Personnel transactions

There have been no other transactions involving equity instruments other than those described in the tables above. For details of other transactions with Key Management Personnel, refer to Note 30 Related Party Transactions.

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28 SHARE BASED PAYMENTS

Options granted to key management personnel are as follows:


Options


28 April 2008 28 April 2013 $0.30 each 75,000

10,425,000

These options vest over a five-year period with a percentage vesting on grant date. Further details of these options are provided in the Directors Report. The options hold no voting or dividend rights and have not been listed. The options lapse when a director or employee ceases with the Consolidated Entity. There were no options vested during the year.

Number Weighted average exercise price

Options outstanding as at 30 June 2008 10,350,000 $0.30

Granted - -

Forfeited - -

Exercised - -

Expired - -


Granted - -

Forfeited - -

Exercised - -

Expired - -


Options exercisable as at 30 June 2009 7,625,000 $0.30

Options exercisable as at 30 June 2010 6,000,000 $0.30

The weighted average remaining contractual life of options outstanding at year end was 2.15 years. The exercise price of outstanding shares at the reporting date was $0.30.

The fair value of the options granted to employees is deemed to represent the value of the employee services received over the vesting period. The weighted average fair value of options granted during the year was $nil (2009: $nil). These values were calculated using the Black-Scholes option pricing model applying the following inputs:

Weighted average exercise price $ 0.30

Weighted average life of the option 5 years

Underlying share price $0.18

Expected share price volatility 55%

Risk free interest rate 6.4%

Historical volatility has been the basis for determining expected share price volatility as it is assumed that this is indicative of future tender, which may not eventuate.

The life of the options is based on the maximum permitted life.

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29 EVENTS AFTER THE REPORTING DATE

As announced to the market on 14 July 2010, the Board of the subsidiary company, JVG Framing Pty Ltd (trading as Component Homes), appointed a Voluntary Administrator on 13 July 2010 to manage the affairs of the business. Mr Dino Travaglini of Moore Stephens, Chartered Accountants is the Voluntary Administrator (“the Administrator”) appointed under Part 5.3A of the Corporations Act 2001.To date the Administrator has been canvassing potential buyers and assessing offers presented with regards to the sale of the assets or components of the business. It is expected that any sales will be resolved in the next few weeks.

The Board has committed to undertake a raising of further capital to revitalise and rejuvenate the group by pursuing more actively the assessment of new projects and ventures for a possible diversification of activities as well as expansion of our current approved activities. Preparation of the necessary documentation is well advanced and details of this offer will be announced shortly.

The Board of JV Global Ltd announced on 28 September 2010 a Joint Venture agreement with Steelcut Enterprises Pty Ltd trading as “Steelhomes” who in themselves have extensive experience in the same industry. The joint venture will allow JVG to utilise and merge its extensive contacts within the steel frame housing and commercial building industry by way of outsourcing its contracts to Steelhomes on a Fee basis, depending on the size and nature of the project, at the same time as avoiding the large staffing costs and capital expenditure requirements of factory premises and plant & equipment. This joint venture, subject to the success thereof, will allow the parties to consider the creation of a new entity with possible increased capital and technological improvements in the industry with a low cost base start. The joint venture also allows JVG access to the use of a builders licence which had previously restricted JVG’s ability to tender for and or take on specific styles of work or expand their offerings to their potential client enquiries.

In addition to the above, the Consolidated Entity moved to new premises in South Perth in September 2010.

30 RELATED PARTY TRANSACTIONS

All transactions with directors or director-related entities and between companies within the consolidated entity occur within a normal employee, customer or supplier relationship on terms and conditions no more favourable than those which it is reasonable to expect the entity would have adopted if dealing with the Directors or director-related entities at arm's length, unless otherwise stated.

Wholly Owned Consolidated Transactions

JV Global Limited has made loans to wholly owned subsidiaries. These loans are interest free and at the date of this report no repayment schedule has been agreed. These loans are repayable on demand. The balance outstanding at 30 June 2010 was $nil (2009: $1,115,431) after provisions for impairment. The funds advanced were used to finance equipment purchases and operating expenses. Repayments of advances for the financial year ended 30 June 2010 were $nil. (2009: $91,000). Loans to wholly owned subsidiaries are eliminated on consolidation.

Transactions with Associates

Loans with associates are interest free and the balance outstanding at 30 June 2010 was $nil (2009 $350,000) after provisions for impairment and allowance for foreign exchange movements. Repayments of advances to Associates received during the year totalled $236,850 (2009: $nil).

Other Related Party Transactions

During the year an entity associated with Mr T Opie provided consulting services to the Consolidated Entity. The value of these services for the financial year ended 30 June 2010 was $36,000 (2010: $nil).

During the year entities associated with Mr C Vost provided capital raising services to the Consolidated Entity. The value of these services for the financial year ended 30 June 2010 was $189,510 (2009:$4,000). In addition one of these companies advanced $25,000 (2009: $115,000) to the Consolidated Entity on commercial terms and conditions. The loans are for a period of less than twelve months and are unsecured with repayments during the year totalling $115,000 (2009: $nil). There is no interest payable on the loans.

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30 RELATED PARTY TRANSACTIONS continued

During the year an entity associated with Mr PM Burns provided accounting services to the Consolidated Entity. The value of these services for the financial year ended 30 June 2010 was $19,727 (2009: $2,066).

During the year an entity associated with Mr SJ Hwang advanced monies to the Consolidated Entity on commercial terms and conditions with a balance at 30 June 2010 of $100,000 (2009: $nil). In addition $610,000 was advanced to the Consolidated Entity during 2009; however this loan was transferred to a related party of Mr S.J. Hwang’s during the prior year. Interest on these loans for the year ended 30 June 2010 was $4,230 (2009: $21,647).

During the year an entity associated with Mr PG Kailis advanced an additional $75,000 to the Consolidated Entity for a total outstanding balance at 30 June 2010 of $685,000 (2009: $610,000). The loans are on commercial terms and conditions and the interest on these loans for the year ended 30 June 2010 was $3,309 (2009: $51,641).

On the 9 February 2009 the Company granted Kailis Consolidated, an entity associated with Mr Kailis, a Deed of Charge over the Company’s assets as security for repayment of a $610,000 convertible note, noted above. Mr PG Kailis resigned as a director on 6 February 2009. Interest on the loan was suspended on 31 March 2009 until 30 June 2011.

31 FINANCIAL RISK MANAGEMENT

The Consolidated Entity’s principal financial instruments comprise bank loans, hire purchase agreements, Convertible Notes, cash and short-term deposits.

The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in the accounting policies to these financial statements, are as follows:

Note CONSOLIDATED

2010 2009

$ $

Financial Assets

Cash and cash equivalents 9 143,437 20,177

Loans and receivables 10 14,825 470,107

Available-for-sale financial assets 13 4,000 -

162,262 490,284

Financial Liabilities - at amortised cost

Trade and other payables 19 979,421 1,313,434

Financial liabilities 20 2,109,987 1,953,945

3,089,408 3,267,379

Financial Risk Management Objectives and Policies

The main purpose of these financial instruments is to raise finance for the Consolidated Entity’s operations. The Consolidated Entity has various other financial assets and liabilities such as trade receivables and trade payables, which arise directly from its operations. It is, and has been throughout the period under review, the Consolidated Entity’s policy that no trading in financial instruments shall be undertaken. The main risks arising from the Consolidated Entity’s financial instruments are cash flow interest rate risk, liquidity risk, and credit risk. The Board reviews and agrees policies for managing each of these risks and they are summarised below.

Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset, financial liability and equity instrument are disclosed in Note 2(g) to the financial statements.

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30 FINANCIAL RISK MANAGEMENT continued

Specific Financial Risk Exposures and Management

The main risks the Consolidated Entity is exposed to through its financial instruments are interest rate risk, foreign currency risk, liquidity risk, and credit risk.

(a) Interest rate risk

Exposure to interest rate risk arises on financial assets and financial liabilities recognised at reporting date whereby a future change in interest rates will affect future cash flows or the fair value of fixed rate financial instruments. The Consolidated Entity is also exposed to earnings volatility on floating rate instruments.

Interest rate risk is managed using a mix of fixed and floating rate debt and as at 30 June 2010 approximately 77% (2009: 85%) of Consolidated Entity debt is fixed rate.

(b) Liquidity risk

Liquidity risk arises from the possibility that the Consolidated Entity might encounter difficulty in settling its debts or otherwise meeting its obligations related to financial liabilities. The Consolidated Entity manages this risk through the following mechanisms:

• preparing forward looking cash flow analysis in relation to its operational, investing and financing activities;

• monitoring undrawn credit facilities;

• obtaining funding from a variety of sources;

• managing credit risk related to financial assets;

• comparing the maturity profile of financial liabilities with the realisation profile of financial assets

The tables below reflect an undiscounted contractual maturity analysis for financial liabilities. Bank overdrafts have been deducted in the analysis as management does not consider that there is any material risk that the bank will terminate such facilities. The bank does however maintain the right to terminate the facilities without notice and therefore the balances of overdrafts outstanding at year end could become repayable within 12 months.

Cash flows realised from financial assets reflect management’s expectation as to the timing of realisation. Actual timing may therefore differ from that disclosed. The timing of cash flows presented in the table to settle financial liabilities reflects the earliest contractual settlement dates and does not reflect management’s expectations that Convertible Notes will be rolled forward.

Financial liability and financial asset maturity analysis

Within 1 year 1 to 5 years Over 5 years Total

2010 2009 2010 2009 2010 2009 2010 2009

CONSOLIDATED $ $ $ $ $ $ $ $

Financial liabilities due for payment

Bank overdrafts 289,769 172,103 - - - - 289,769 172,103

Trade and other payables 979,421 1,313,434 - - - - 979,421 1,313,434

Lease Liabilities 51,047 46,624 49,171 100,218 - - 100,218 146,842 Amounts payable to related parties 200,000 115,000 - - - - 200,000 115,000

Convertible Notes 1,520,000 1,520,000 - - - - 1,520,000 1,520,000

Total expected outflows 3,040,237 3,167,161 49,171 100,218 - - 3,089,408 3,267,379

Financial assets - cash flows realisable

Cash and cash equivalents 143,437 20,177 - - - - 143,437 20,177

Trade and other receivables 14,825 470,107 - - - - 14,825 470,107 Available-for-sale financial assets 4,000 - - - - - 4,000 -

Total anticipated inflows 162,262 490,284 - - - - 162,262 490,284

Net inflow/ (outflow) on financial instruments (2,877,975) (2,676,877) (49,171) (100,218) - - (2,927,146) (2,777,095)

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30 FINANCIAL RISK MANAGEMENT continued

(c) Credit risk

Exposure to credit risk relating to financial assets arises from the potential non-performance by counter parties of contract obligations that could lead to a financial loss to the Consolidated Entity.

Credit risk is managed through the maintenance of procedures (such procedures include the utilisation of systems for the approval, granting and renewal of credit limits, regular monitoring of exposures against such limits and monitoring of the financial stability of significant customers and counter parties), ensuring to the extent possible, that customers and counter parties to transactions are of sound credit worthiness. Such monitoring is used in assessing receivables for impairment. Credit terms are generally 30 to 90 days from the invoice date.

Credit Risk Exposure

The maximum exposure to credit risk by class of recognised financial assets at reporting date, excluding the value of any collateral or other security held, is equivalent to the carrying value and classification of those financial assets (net of any provisions) as presented in the Statement of Financial Position. Since the Consolidated Entity trades only with recognised third parties, there is no requirement for collateral.

Refer to Note 10 for further analysis of credit risk.

Net Fair Values

Fair Value Estimation

The Consolidated Entity’s carrying values of financial assets and financial liabilities are equal to the respective assets and liabilities fair values during both 2010 and 2009 financial years.

As at 1 July 2009 the Consolidated Entity has adopted the amendment to AASB 7: Financial Instruments: Disclosures which requires disclosure of fair value measurements by level of the following fair value hierarchy:

Level 1. Quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2. Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and

Level 3. Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The follow table represents the Consolidated Entity’s assets and liabilities measured at fair value at 30 June 2010. Comparative information has not been provided as permitted by the transitional provisions of AASB 7.

Level 1 Level 2 Level 3 Total

2010 $ $ $ $

Financial Assets held at Fair Value through Profit or Loss

- Listed Investments, at Fair Value 4,100 - - 4,100

Sensitivity Analysis

The following table illustrates sensitivities to the Consolidated Entity’s exposures to changes in interest rates and exchange rates. The table indicates the impact on how profit and equity values reported at reporting date would have been affected by changes in the relevant risk variable that management considers to be reasonably possible. These sensitivities assume that the movement in a particular variable is independent of other variables.

CONSOLIDATED

Profit Equity

$ $

Year ended 30 June 2010

+/- 2% in interest rates +/- 805 +/- 805

Year ended 30 June 2009

+/- 10% in interest rates +/- 15,363 +/- 15,363

+/- 10% in AUD:UED exchange rates +/- 58,390 +/- 58,390

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31 VARIANCES FROM THE PRELIMINARY FINAL REPORT

The financial information presented in the preliminary final report lodged on 31 August 2010 was in the process of being reviewed by management and audited by the Consolidated Entity’s independent auditor. The following adjustments have been made to the information presented in the preliminary final report:

CONSOLIDATED

2010 2009

Consolidated Statement of Comprehensive Income $ $

Net Loss

Net Loss for the Period reported in the preliminary final report (2,186,507) (5,839,000)

Additional impairment expenses recognised (238,717) -

Net Loss for the Period reported in the financial statements (2,425,224) (5,839,000)

Other Comprehensive Income - -

Total Comprehensive Loss for the Period (2,425,224) (5,839,000)

Consolidated Statement of Financial Position

Current Assets

Current Assets reported in the preliminary final report 423,730 767,330


Reclassification of Financial Assets 4,000 -

Current Assets reported in the financial statements 278,112 767,030

Non-Current Assets

Non-Current Assets reported in the preliminary final report 313,350 1,044,821


Reclassification of Financial Assets (4,000) -

Current Assets reported in the financial statements 220,251 1,044,821

Total Deficiency

Equity reported in the preliminary final report (2,460,105) (1,632,377)


Total Deficiency reported in the financial statements (2,698,822) (1,632,377)

Consolidated Statement of Changes in Equity

Accumulated Losses

Accumulated Losses reported in the preliminary final report (23,732,192) (21,545,685)


Accumulated Losses reported in the financial statements (23,970,909) (21,545,685)

32 COMPANY DETAILS

The registered office and principal place of business of the Company is:

JV Global Limited Shop 12 “South Shore Piazza” 85 South Perth Esplanade South Perth WA 6151 Telephone: +61 8 9363 1750

PO Box 1196 South Perth WA 6951 Facsimile: +61 8 9367 2450

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Grant Thornton Audit Pty Ltd ABN 94 269 609 023 10 Kings Park Road West Perth WA 6005 PO Box 570 West Perth WA 6872

T +61 8 9480 2000

F +61 8 9322 7787

E [email protected]

W www.grantthornton.com.au

50

Grant Thornton Australia Limited is a member firm within Grant Thornton International Ltd. Grant Thornton International Ltd and the member firms are not a worldwide partnership. Grant Thornton Australia Limited, together

with its subsidiaries and related entities, delivers its services independently in Australia.

Liability limited by a scheme approved under Professional Standards Legislation

Independent Auditor’s Report

To the Members of JV Global Limited

Report on the financial report

We have audited the accompanying financial report of JV Global Limited (the “Company”),

which comprises the consolidated statement of financial position as at 30 June 2010, and the

consolidated statement of comprehensive income, consolidated statement of changes in

equity and consolidated statement of cash flows for the year ended on that date, a summary

of significant accounting policies, other explanatory notes to the financial report and the

directors’ declaration of the consolidated entity comprising the Company and the entities it

controlled at the year’s end or from time to time during the financial year.

Directors’ responsibility for the financial report

The directors of the Company are responsible for the preparation and fair presentation of

the financial report in accordance with Australian Accounting Standards (including the

Australian Accounting Interpretations) and the Corporations Act 2001. This responsibility

includes establishing and maintaining internal controls relevant to the preparation and fair

presentation of the financial report that are free from material misstatement, whether due to

fraud or error; selecting and applying appropriate accounting policies; and making

accounting estimates that are reasonable in the circumstances. The directors also state, in the

notes to the financial report, in accordance with Accounting Standard AASB 101

Presentation of Financial Statements, that compliance with the Australian equivalents to

International Financial Reporting Standards ensures that the financial report, comprising the

financial statements and notes, complies with International Financial Reporting Standards.

Auditor’s responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We

conducted our audit in accordance with Australian Auditing Standards which require us to

comply with relevant ethical requirements relating to audit engagements and plan and

perform the audit to obtain reasonable assurance whether the financial report is free from

material misstatement.

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An audit involves performing procedures to obtain audit evidence about the amounts and

disclosures in the financial report. The procedures selected depend on the auditor’s

judgement, including the assessment of the risks of material misstatement of the financial

report, whether due to fraud or error.

In making those risk assessments, the auditor considers internal control relevant to the

entity’s preparation and fair presentation of the financial report in order to design audit

procedures that are appropriate in the circumstances, but not for the purpose of expressing

an opinion on the effectiveness of the entity’s internal control. An audit also includes

evaluating the appropriateness of accounting policies used and the reasonableness of

accounting estimates made by the directors, as well as evaluating the overall presentation of

the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide

a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the

Corporations Act 2001.

Basis for qualified auditor’s opinion

Going Concern Basis

As disclosed in Note 2(t), the Board of the subsidiary company, JVG Framing Pty Ltd

(trading as Component Homes) appointed a Voluntary Administrator on 13 July 2010. The

ability of the Company to continue as a going concern is dependent upon on a number of

factors. These factors include the success of a proposed future capital raising initiative and

the determination of a final position of the Company in relation to any potential action

taken by financiers over guarantees provided by the Company for unpaid debt facilities

provided to Component Homes. The Company has held pre-emptive discussions with

financiers regarding possible arrangements to continue its current facilities should a shortfall

exist at the conclusion of the Voluntary Administration process.

These conditions, along with the matters disclosed in Note 2(t), indicate the existence of a

material uncertainty which may cast significant doubt on the Company’s ability to continue

as a going concern and therefore it may be unable to realise its assets and discharge its

liabilities in the normal course of business. Due to the extent of the uncertainties described

above, the ultimate values realised or recognised for assets and liabilities may be materially

different from their carrying values as stated in the financial statements of the Company.

Qualified of auditor’s opinion

In our opinion, except for the matter set out in the preceding paragraphs, the financial

report of JV Global Limited is in accordance with the Corporations Act 2001, including:

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i giving a true and fair view of the consolidated entity’s financial position as at 30

June 2010 and of its performance for the year ended on that date; and

ii complying with Australian Accounting Standards (including the Australian

Accounting Interpretations) and the Corporations Regulations 2001; and

b the financial report also complies with International Financial Reporting Standards as

disclosed in Note 2.

Report on the remuneration report

We have audited the remuneration report included in pages 7 to 9 of the directors’ report

for the year ended 30 June 2010. The directors of the Company are responsible for the

preparation and presentation of the remuneration report in accordance with section 300A of

the Corporations Act 2001. Our responsibility is to express an opinion on the remuneration

report, based on our audit conducted in accordance with Australian Auditing Standards.

Auditor’s opinion on the remuneration report

In our opinion, the remuneration report of JV Global Limited for the year ended 30 June

2010, complies with section 300A of the Corporations Act 2001.

GRANT THORNTON AUDIT PTY LTD Chartered Accountants P W Warr Director – Audit & Assurance Perth, 30 September 2010

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Shareholder Information

The shareholder information set out below was applicable as at 30 September 2010.

DISTRIBUTION OF EQUITY SECURITIES

a. Analysis of numbers of equity security holders by size of holding

Category (size of holding) Holders Ordinary Shares Options

1 - 1,000 84 16,980 -

1,001 - 5,000 58 183,016 -

5,001 - 10,000 107 998,040 -

10,001 - 100,000 227 10,002,588 1

100,001 and over 246 214,377,611 7

722 225,578,235 8

b. There were 450 holders or less than marketable parcel of ordinary shares based on a price of $0.005 centre per share.

TWENTY LARGEST EQUITY SECURITY HOLDERS

The names of the twenty largest holders of each class issued securities are listed below:

Shareholders

Name of Shareholder

Number of listed ordinary shares

held

Percentage of listed ordinary

shares

1 S J Hwang 10,275,000 4.55

2 RBC Dexia Investor Services Australia Nominees Pty Limited <MLCI A/C> 9,901,105 4.39

3 Kailis Consolidated Pty Ltd 6,075,000 2.69

4 SA Capital Funds Management Limited 6,000,000 2.66

5 Cervantes Corporation Limited 5,450,000 2.42

6 GIBCA Limited 5,000,000 2.22

7 Avost Holdings Pty Ltd <Bluesky A/C> 4,800,000 2.13

8 Laceglen Holdings Pty Ltd <Cadly Superfund A/C> 4,000,000 1.77

9 Wildview Nominees Pty Ltd <Opie Family Super Fund A/C> 3,733,963 1.66

10 Allcrest Nominees Pty Ltd 3,500,000 1.55

11 Mr Clarke Barnett Dudley 3,400,000 1.51

12 National Nominees Limited 3,250,000 1.44

13 Kailis Consolidated Pty Ltd & Kondil Nominees Pty Ltd 3,017,600 1.34

14 Hoperidge Enterprises Pty Ltd <The Jones Family A/C> 3,000,000 1.33

15 Robmob Pty Ltd 3,000,000 1.33

16 Mr Bernard Pontre <The Ryloe A/C> 2,810,000 1.25

17 Wonder Holdings Pty Ltd 2,800,000 1.24

18 Sybil Nominees Pty Ltd <Peter & Sybil Burns SF A/C> 2,449,690 1.09

19 Whimplecreek Pty Ltd 2,000,000 .89

20 GA Armstrong Superannuation Pty Ltd <GA & FC Armstrong Family A/C> 2,000,000 .89

86,462,358 38.35

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Shareholder Information continued

Option Holders

Name of Shareholder

Number of unlisted options

held Percentage of unlisted options

1. Wildview Nominees Pty Ltd 6,000,000 38.90%

2. Zurich Securities Pty Ltd 5,000,000 32.42%

3. Sybil Nominees Pty Ltd 1,500,000 9.72%

4. McKinnon, K.S. 1,500,000 9.72%

5. Hutson, K 750,000 4.87%

6. Hutson, M 300,000 1.94%

7. Franciskovik, V 300,000 1.94%

8. Stanton, S 75,000 0.49%

15,425,000 100.00%

Unquoted Securities

There are 15,425,000 unquoted Share Options on issue at the date of lodgement. Details of these options are:-


Options


28 April 2008 28 April 2013 $0.30 each 75,000

20 August 2009 30 December 2010 $0.02 each 5,000,000

15,425,000

Substantial Shareholders

Substantial shareholders in the company (holding not less than 5% of the issued capital), as disclosed in substantial shareholder notices given to the company, are set out below:

Ordinary Shares Unlisted Share Options Number % Number % Wildview Nominees Pty Ltd / RBC Dexia investor Services 13,635,068 6.04% 6,000,000 38.90%

Zurich Securities Ltd 5,000,000 32.42%

Sybil Nominees Pty Ltd 1,500,000 9.72%

McKinnon, K.S. 1,500,000 9.72% Voting Rights

The voting rights attaching to the shares in the company are as set out below:

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

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