Final Results

29 September 2014

MoneySwap Plc

("MoneySwap", the "Company" or the "Group")

Audited Results for year ended 31 March 2014

MoneySwap (AIM: SWAP), the provider of payment solutions to online and point of sale merchants licenced for UnionPay in the UK and the provider for UnionPay MoneyExpress service enabling overseas persons to send funds directly to UnionPay cardholders in China, is pleased to announce the Company's audited results for the 12 months ended 31 March 2014.

A copy of the annual report and accounts will shortly be made available on the Company's website, www.moneyswapholdings.com, in accordance with AIM Rule 20.

For further information, please contact:

About MoneySwap(www.moneyswap.com)

MoneySwap provides payment solutions and gateways to merchants which allow both online and point of sale transactions to be settled using UnionPay cards in the UK. In addition, UnionPay has licensed MoneySwap for its MoneyExpress service which enables overseas persons to send funds directly to UnionPay cardholders in China. The Company also offers prepaid card services working with partners such as Corner Bank, Switzerland and Visa and offers an online peer to peer platform for currency exchange and payments. The Company's shares are traded on the London Stock Exchange's AIM market (AIM: SWAP). More information can be found at www.moneyswap.com.

CHIEF EXECUTIVE OFFICER'S STATEMENT

Dear Shareholder,

During the financial year ended 31 March 2014 MoneySwap achieved a number of key strategic goals. On the financial side revenue increased by 186% to US$369,000 (£222,000), from US$129,000 (£78,000) in 2013, whilst maintaining a decrease in operating expenses, excluding foreign exchange differences, which were down by 8% to US$4.36 million (£2.62 million) from US$4.73 million (£2.84 million) in 2013. In terms of funding the Company raised US$2.65 million (£1.59 million) in loans. These can be converted to shares at the option of the Company only. During the year the equity was further increased by the conversion of US$4.65 million (£3.00 million) of loans and payables to ordinary shares of which US$4.59 million was converted at 1.35 British pence per share and US$0.06 million was converted at 0.60 British pence per share. During the period we also established the foundation for our MoneySwap brand in the United Kingdom and validated our sales strategy for the UK by securing key channel and trade association partners.

Business review (April 2013 - March 2014)

In 2012/13, our focus was to build robust, scalable and secure UnionPay payment solutions. During the year under review our focus was to build a sales and marketing team in the UK to deliver revenue growth from the payment solutions we developed. This was achieved.

We hired six marketing and sales professionals from the industry with in-depth market knowledge, proven sales records and extensive networks. The strategy was to secure: 1) channel partners; 2) trade associations; and 3) tier one merchants.

We teamed up with some of the leading UK payment service providers (PSP's) and independent sales organisations (ISO's). These channel partners have significant communities of existing merchants to refer to us for UnionPay payment solutions. This has the potential to substantially accelerate our route to market while keeping our sales costs down.

Partnering with trade associations has been particularly successful. MoneySwap was designated as the UnionPay payment acquirer by prestigious associations such as VisitBritian, the Association of Leading Visitor Attractions (ALVA) and the City of London Corporation. Their members, numbered in the hundreds, represent some of the largest tourist attractions and merchants in the UK. These include British Museum, Tower of London, Bicester Village, British Airways and major high street retailers. MoneySwap attended and was featured in a number of seminars sponsored by these trade organisations which served to promote MoneySwap brand recognition.

Finally, our direct sales team signed up some key tier one merchants and commenced negotiations with others. These included Air Charter Services, one of the leading private jet leasing companies, LuLu Guinness, a fashion retailer with branches across the UK, and the Signet Group which has over 500 jewelry outlets in the UK.

These successes have validated our sales strategy and ability to execute. The pace was hampered by the lower than expected level of awareness of the UnionPay brand in the UK and, of course, awareness of our own brand. However, both brands are now increasing their awareness and we expect that this will continue with the support of our partners and the expected increase of Chinese visitors to the UK.

1) Products and Services

Our focus remained on providing three UnionPay services:

These consist of: 1) Point of Sale (POS) which enables UK merchants to accept payment with the cardholder present swiping their card; 2) online e-payments referring to payments made by a cardholder in China for products and services offered online by UK based merchants; and 3) MoneyExpress which enables funds to be remitted from outside of China to UnionPay cardholders in China. Our proprietary technology and intellectual property ensures that these remittances are extremely fast and can be completed within one minute (including the usually lengthy transaction verification by UnionPay, the cardholder's bank in China and the State Administration of Foreign Exchange in China).

MoneySwap has its own e-payment gateways for all three services. This has significant advantages as we do not rely on third parties gateways and have the option to offer our solutions to other UnionPay merchant acquirers who rely on third party providers. With our back office infrastructure which involves transaction settlements, anti-money laundering compliance, money transfers through SWIFT and a fully implemented customer relationship management system we are well positioned to serve our merchants.

Emphasis of matter

The auditor's report to the financial statements for the year ended 31 March 2014 includes an emphasis of matter in relation to the Group's ability to continue as a going concern. Notwithstanding this, the Directors are confident in the Group's ability to continue as a going concern and consider that the Group is poised for revenue growth.

Post-year outlook

Post-year end, despite a slower than expected start, we consider that macro-conditions are favourable and that we are in a strong position to grow our revenue.

We continue to negotiate with leading UK PSPs which would result in access to hundreds of retail and online sites. Our trade association partners such as VisitBritian, ALVA and City of London Corporation, are continuing to promote our brand and raise awareness and we are starting to see tangible results from these. MoneySwap is now a member of the China-Britain Business Council (CBBC) and is becoming recognised as a source of information on the spending behavior of the Chinese consumer. We are further building our brand recognition through social and other digital media, such as Twitter, LinkedIn and Google Ads, and anticipate that this will also assist in helping to secure tier one merchants above.

Innovation remains a central core to our business and we see this as fundamental to our ability to continue to attract new customers. We are currently finalising a multi-card POS solution which will enable merchants to accept various cards, including UnionPay, through a single POS terminal. This saves merchants valuable counter space and offers them a single provider for their payments needs, thus enabling cost savings for them. This solution can also be used in e-commerce where the e-payment gateways accept various cards. These multi-card services will be possible through new PSP partnerships which support non UnionPay cards. These benefits are real to the merchants and complement our UnionPay solutions. These multi-card solutions are expected to be launched during the current financial year.

Clearly as the number of Chinese visitors to the UK increase, so does our potential revenue. In 2013 over 1.3 million Chinese visitors visited Europe but only 292,000 went to the UK. Those that visited the UK spent over £493 British Pounds. Recent relaxations in UK visa requirements for Chinese visitors should result in an increase to these numbers. For instance, in August 2014, the UK Home Office announced improvements to the visa system in China, including a 24-hour visa service and, on 12 September 2014, Home Secretary Theresa May said that she is taking steps to enable Chinese who visit the UK to submit both UK and Schengen visa applications at the same time, substantially simplifying the visa process. With over 3.2 billion UnionPay cards in circulation, virtually all of these Chinese visitors are UnionPay cardholders. It is their card of choice and most do not also hold alternative credit or debit cards. Acceptance of UnionPay cards is rapidly becoming a must for UK retailers seeking to maximize their sales to Chinese consumers and we continue to believe that MoneySwap has the best payment solution for merchants to offer Chinese customers.

According to the China E-Commerce Research Center, China online shoppers' overseas purchases reached US$12.5 billion in 2013, and this is estimated to increase to US$22.68 billion in 2014. Our online UnionPay solution enables UK merchants to accept payments from Chinese online shoppers. UK merchants may be becoming more aware of the potential online opportunity in China with the recent interest in Alibaba's initial public offering. Against this backdrop, the Directors believe that China is one of the most compelling emerging markets for UK merchants.

We are also excited about the potentially significant opportunity that MoneyExpress gives us to tap into the US$57 billion market of inward remittances to China. Using MoneyExpress, a person outside of China can remit funds in less than one minute to eligible UnionPay cardholders in China. The cardholder can then use their card at an ATM to withdraw cash or make purchases wherever UnionPay cards are accepted. MoneySwap is one of the first providers to be able offer this relatively new UnionPay service online. This, coupled with the MoneySwap platform found on www.moneyswap.com, offers our customers compelling benefits such as convenience, transparency and security.

Each one of our three UnionPay solutions represents an opportunity for significant revenue generation. They are intricately linked to the purchasing power of Chinese consumers for goods and services they buy abroad. Whilst progress is taking time, the market potential is extremely significant and we believe that in MoneySwap there is an opportunity to "tap into the spending of millions of Chinese consumers".

I thank our talented and dedicated team for providing value to our merchants and customers. They are highly focused and determined to deliver. I also thank our board of directors for their engagement and governance. And finally, you our shareholders, thank you for another year of support and patience. We have built solid foundations for products and services and our brand and drive to serve and delight the customer is resonating in the market. We believe we are well poised for revenue growth and look forward to being able to update you with positive developments at the appropriate time. 

Richard V. Proksa

Chief Executive Officer

Date: 29 September 2014

MONEYSWAP PLC CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOMEFOR THE YEAR ENDED31 MARCH 2014

MONEYSWAP PLC CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2014

MONEYSWAP PLC CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 MARCH 2014

MONEYSWAP PLC CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2014

MONEYSWAP PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AND COMPANY STATEMENT OF FINANCIAL POSITION FOR THE YEAR ENDED 31 MARCH 2014

1 General

MoneySwap Plc (the "Company") and its subsidiaries (together the "Group") are principally engaged in providing prepaid card services and merchant acquisition services to China UnionPay ("CUP"), and operating an online peer to peer foreign exchange and payment platform.

The Company is a public limited company incorporated and domiciled in Gibraltar. The Company's shares were listed on the Alternative Investment Market ("AIM") of the London Stock Exchange on 31 August 2011.

2 Significant accounting policies

The consolidated financial statements of the Group have been prepared in accordance with International Financial Report Standards ("IFRSs") as adopted by the European Union ("EU"). IFRSs are subject to amendment and interpretation by the International Accounting Standards Board ("IASB") and the IFRSs Interpretations Committee and there is an ongoing process and review and amendment by the European Commission.

These accounting policies comply with each IFRSs that were mandatory for accounting for the year ended 31 March 2014.

The consolidated financial statements also comply with Gibraltar Companies (Accounts) Act 1999, the Gibraltar Companies (Consolidated Accounts) Act 1999 and the Gibraltar Companies Act 1930 (as amended). Under Section 10(2) of the Gibraltar (Consolidated Accounts) Act 1999, the Company is exempt from the requirement to present its own statement of profit or loss and other comprehensive income.

The parent company made a loss after tax of US$14,493,685 (2013: US$1,271,206).

The principal accounting policies adopted by the Group in the preparation of its financial statements for the year ended 31 March 2014 with comparatives for the year ended 31 March 2013, are set out below. The accounting policies have been consistently applied to all periods provided.

Going concern

The Group has prepared a budget covering 12 months from the date of this report. After careful review of the Group's budget and its inherent assumptions and sensitivities for profit and free cash flow generation, its medium-term plans, the support provided by certain existing significant shareholders and debt providers, liquid resources and all relevant matters, the directors are confident that the Company and the Group have adequate financial resources to continue in operational existence for the foreseeable future from the date of approval of this report. They have therefore continued to adopt the going concern basis in preparing the financial statements which do not include any adjustments that may result if the Group was unable to continue as a going concern, including any changes to critical accounting estimates and judgements disclosed in note 3 or any additional provisions which may be required.

Basis of consolidation

The consolidated financial statements incorporate the results of the Company and entities controlled by the Company (its subsidiaries).

These financial statements consolidate the results and statement of financial position of the Company and those entities treated as subsidiaries using the acquisition method of accounting.

Subsidiaries are entities controlled by the Group. The Group controls an entity when it is expected to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of profit or loss and other comprehensive income from the date the Group gains control until the date when the Group ceases to control the subsidiary.

Profit or loss and each component of other comprehensive income are attributable to the owners of the Company and to the non-controlling interests. Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Group's accounting policies.

All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation.

Non-controlling interests

Non-controlling interests represent the equity in a subsidiary not attributable directly or indirectly to the Company. They are presented in the consolidated statement of financial position within equity based on the share of net assets, separately from equity attributable to the equity holders of the Company. Non-controlling interests in the results of the Group are presented on the face of the consolidated statement of profit or loss and other comprehensive income.

Changes in the Group's interests in a subsidiary that do not result in a loss of control are accounted for as equity transactions, whereby adjustments are made to the amounts of controlling and non-controlling interests within consolidated equity to reflect the change in relative interests, but no adjustments are made to goodwill and no gain or loss is recognised as an allocation of the total profit or loss and total comprehensive income for the year between non-controlling interests and the equity holders of the Company.

Goodwill

Goodwill is the difference between the cost of an acquired entity and the aggregate of the fair value of that entity's identifiable assets and liabilities. Positive goodwill is capitalised on the consolidated statement of financial position.

Any goodwill that arises is tested annually for impairment. If any indications of impairment exist then an impairment loss is recognised if the carrying amount of the goodwill exceeds its estimated recoverable amounts.

Investment in associate

An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.

The results and assets and liabilities of associate are incorporated in the consolidated financial statements using the equity method of accounting. Under the equity method, investment in associate is carried in the consolidated statement of financial position at cost as adjusted for post-acquisition changes in the Group's share of the net assets of the associate, less any impairment in the value of individual investments.

Losses of an associate in excess of the Group's interest in that associate (which includes any long-term interests that, in substance, form part of the Group's net investment in the associate) are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate.

Where a group entity transacts with an associate of the Group, profits and losses are eliminated to the extent of the Group's interest in the relevant associate.

Property, plant and equipment

Property, plant and equipment are stated at historical cost less depreciation less any recognised impairment losses. Subsequent costs are included in the asset's carrying amount only when it is probable that future economic benefits associated with the item will flow to the Group and the costs can be measured reliably. All other costs, including repairs and maintenance costs, are charged to the statement of profit or loss and other comprehensive income in the period in which they are incurred.

Depreciation is provided on all property, plant and equipment other than freehold land and is calculated on a straight-line basis as follows:

Office and computer equipment - 20%

Leasehold improvements - 20%

Depreciation is provided on cost less residual value. The residual value, depreciation methods and useful lives are annually reassessed.

The carrying values of property, plant and equipment are reviewed for impairment annually and when events or changes in circumstances indicate that the carrying value may be impaired. Any impairment is taken direct to the statement of profit or loss and other comprehensive income.

Intangible assets

Intangible assets consist of development expenditure incurred in respect of software for the Group's electronic exchange platform and payment gateway systems and is recognised as an intangible asset in accordance with the provision of IAS 38 "Intangible Assets". Capitalised development expenditure is stated at cost less accumulated amortisation and impairment losses, if any. Amortisation of these assets is charged to administrative and operating expenses in the statement of profit or loss and other comprehensive income on a straight-line basis over the expected useful economic life of the asset.

Amortisation is charged against assets from the date at which the asset becomes available for use and is calculated on straight line basis as follows:

Electronic exchange platform - 20%

Payment gateway systems - 20%

Where no intangible asset can be recognised, development expenditure is treated as expenditure in the period in which it is incurred.

Impairment of non-financial assets

At each balance sheet date, the directors review the carrying amounts of the Group's tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss, if any.

Equity

Equity comprises the following:

· "Share capital" represents amounts subscribed for shares at nominal value.

· "Share premium" represents amounts subscribed for share capital, net of issue costs, in excess of nominal value.

· "Share-based payment reserve" represents amounts credited for share option expenses, until exercise or forfeiture of share options, when the amounts are taken into share capital and premium or retained earnings.

· "Foreign exchange translation reserve" represents the exchange differences arising from the translation of the financial statements of the parent company into the Group's presentation currency and the translation at the closing rate of the net investment in the subsidiaries.

· "Combination reserve" represents amounts arising from the difference between the cost of the acquisition and the fair value of the assets to be recorded to the account for the share for share exchange, which occurred during the years ended 31 March 2011 and 31 March 2012.

· "Retained earnings" represents the accumulated profits and losses attributable to equity shareholders.

Financial instruments

Financial assets and financial liabilities are recognised in the consolidated statement of financial positionwhen the Group becomes a party to the contractual provisions of the instrument.

Trade and other receivables are measured at initial recognition at fair value, and are subsequently measured at amortised cost using the effective interest method. A provision is established when there is objective evidence that the Group will not be able to collect all amounts due. The amount of any provision is recognised in the statement of profit or loss and other comprehensive income.

Trade and other payables are initially measured at fair value, and are subsequently measured at amortised cost using the effective interest rate method.

Cash and cash equivalents comprise 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.

An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs.

Convertible loan notes

At initial recognition the convertible loan notes which do not contain an equity component are measured at fair value and subsequently carried at amortised cost. The interest expense recognised in the statement of profit or loss and other comprehensive income for the convertible loan notes is calculated using the effective interest method.

If the note is converted, the carrying amounts of the convertible loan notes are transferred to share capital and share premium as consideration for the shares issued. If the note is redeemed, any difference between the amount paid and the carrying amount is recognised in the statement of profit or loss and other comprehensive income.

Revenue recognition

Revenue comprises sales of prepaid cards, commission from merchant acquisition services for China UnionPay ("CUP") and commission received on the execution of foreign exchange and fund transfers on behalf of the clients. Other income mainly comprises bank interest income.

· Sales income from prepaid cards is recognised when the significant risks and rewards of the ownership have been transferred to the customers.

· Commission from merchant acquisition services is recognised based on settlement of the relevant payment transactions.

· Commission from remittance is recognised on an accruals basis following execution of the transactions.

· Bank interest income is recognised as it accrues using the effective interest method.

Foreign currency translation

The functional currency of the Company is Sterling ("£"). As the Group operates in both Europe and Asia, United States dollars ("US$") is used as the presentation currency for the Group's consolidated financial statements. Foreign currency transactions by Group companies are recorded in their functional currencies at the exchange rate at the date of the transaction. Monetary assets and liabilities have been translated at rates in effect at the balance sheet date, with any exchange adjustments being charged or credited to profit or loss.

On consolidation the assets and liabilities of the subsidiaries with non-United States dollars functional currency are translated into the Group's presentation currency at the exchange rate at the balance sheet date and the income and expenditure account items are translated at the average rate for the period.

For the purpose of foreign currency translation, the net investment in a subsidiary is determined inclusive of foreign currency intercompany balances for which settlement is neither planned nor likely to occur in the foreseeable future.

Foreign currency differences are recognised in other comprehensive income, and presented in the foreign currency translation reserve (translation reserve) in equity. If the operation is a non-wholly-owned subsidiary, then the relevant proportionate share of the translation difference is allocated to the non-controlling interests.

In the statement of cash flows, cash flows denominated in foreign currencies are translated into the presentation currency of the Group at the average exchange rate for the year or at the prevailing rate at the time of the transaction where more appropriate.

The exchange rate applied at the statement of financial position date was US$1.6642 per £1 (2013: US$1.5209).

Employment benefits

Provision is made in the financial statements for all employee benefits. Liabilities for wages and salaries, including non-monetary benefit and annual leave obliged to be settled within 12 months of the balance sheet date, are recognised in accruals.

Share-based payments

The grant-date fair value of share-based payment awards granted to employees is recognised as an employee expense, with a corresponding increase in equity, over the period that the employees unconditionally become entitled to the awards. The amount recognised as an expense is adjusted to reflect the number of awards for which the related service and non-market vesting conditions are expected to be met, such that the amount ultimately recognised as an expense is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant-date fair value of the share-based payment awards is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.

The Group measures the cost of equity-settled share-based payments by reference to the fair value of the equity instruments at the date at which they are granted.

Lease payments

Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term of the lease.

Current tax

Current tax for each taxable entity in the Group is based on the local taxable income at the local statutory tax rate enacted or substantively enacted at the balance sheet date and includes adjustments to tax payable or recoverable in respect of previous periods.

Deferred tax

Deferred tax is calculated using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, if the deferred tax arises from the initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss, it is not accounted for. Deferred tax is determined using tax rates and laws that have been enacted (or substantially enacted) by the balance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

Deferred tax liabilities are provided in full.

Deferred tax assets are recognised to the extent that it is probable that, i.e., more likely than not, future taxable profits will be available against which the temporary differences can be utilised.

Changes in deferred tax assets or liabilities are recognised as a component of tax expense in the statement of profit or loss and other comprehensive income, except where they relate to items that are charged or credited directly to equity in which case the related deferred tax is also charged or credited directly to equity.

New standards and interpretations in issue but not yet effective

At the date of authorisation of these consolidated financial statements, the following standards and interpretations were in issue but not yet mandatorily effective and have not been applied in the financial statements:

· IFRS 9 - Financial Instruments - effective for annual periods commencing on or after 1 January 2018

· IFRIC 21: Levies - effective for annual periods commencing on or after 1 January 2014

· Amendments to IFRS 10, 12 and IAS 27: Investment Entities - effective for annual periods commencing on or after 1 January 2014

· Amendments to IAS 32: Offsetting Financial Assets and Liabilities - effective for annual periods commencing on or after 1 January 2014

· Amendments to IAS 36: Recoverable Amount Disclosures for Non-Financial Assets - effective for annual periods commencing on or after 1 January 2014

· Amendments to IAS 39: Novation of Derivatives and Continuation of Hedge Accounting - effective for annual periods commencing on or after 1 January 2014

The directors anticipate that the adoption of these standards and interpretations will not have a material impact on the consolidated financial statements in the period of initial adoption.

3 Critical accounting estimates and judgements

In preparing the consolidated financial statements, IFRSs requires management to exercise its judgement in the process of applying the Group's accounting policies. It also requires the use of certain critical accounting estimates and assumptions. The critical accounting estimates and judgments made by the Group regarding the future or other key sources of estimation uncertainty and judgment that may have a significant risk of giving rise to a material adjustment to the carrying values of assets and liabilities within the next financial year are:

Share-based payments

The Group measures the cost of share options granted by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by an external valuer using a Binomial model, with the assumptions detailed in note 18. The accounting estimates and assumptions relating to these share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact expenses and equity.

Impairment of goodwill

The Group determines whether goodwill is impaired on an annual basis. This requires an estimation of the recoverable amount of the cash-generating units, using value-in-use calculations, to which the goodwill is allocated. These value-in-use calculations require the Group to estimate the future cash flows expected to arise from the cash-generating units and a suitable discount rate in order to calculate the present values. The assumptions used in this estimation of recoverable amount and the carrying amount of goodwill are discussed in note 12.

Development expenditure

The Group's accounting policy for development expenditure results in certain items of expenditure being capitalised where it is considered likely to be recoverable by future revenue generated from sales achieved by the Group. This policy requires management to make certain estimates and assumptions as to future events and circumstances. Any such estimates and assumptions may change as new information becomes available. If, after having capitalised the expenditure under the policy, a judgement is made that recovery of the expenditure is unlikely, the relevant capitalised amount will be written off to the statement of profit or loss and other comprehensive income. 

Impairment of development expenditure

In accordance with the Group's accounting policy, each asset (or cash generating unit) is evaluated every reporting period to determine whether there are any indications of impairment. If any such indication exists, a formal estimate of recoverable amount is performed and an impairment loss recognised to the extent that carrying amount exceeds recoverable amount. The recoverable amount of an asset (or cash generating group) of assets is measured at the higher of fair value less costs to sell and value in use.

Fair value is determined as the amount that would be obtained from the sale of the asset in an arm's length transaction between knowledgeable and willing parties. Value in use is also generally determined as the present value of the estimated future cash flows, but only those expected to arise from the continued use of the asset in its present form and its eventual disposal. Present values are determined using a risk-adjusted pre-tax discount rate appropriate to the risks inherent in the asset. Future cash flow estimates are based on expected sales volumes and prices (considering current and historical prices, price trends and related factors), operating costs and future capital expenditure. This policy requires management to make these estimates and assumptions which are subject to risk and uncertainty. Hence, there is a possibility that changes in circumstances will alter these projections, which may impact the recoverable amount of the capitalised development expenditure. In such circumstances, some or all of the carrying value of the asset may be impaired and the impairment would be charged against the statement of profit or loss and other comprehensive income.

Useful economic life of intangible assets

For intangible assets which have a finite life, the directors revisit their estimate of useful economic life at each period end and revise accordingly. The directors take into consideration the intangible asset and related sales volume (including historic and projected).

4 Segmental information

In the opinion of the directors, the Group has three business lines as described below, which are managed separately as they require different strategies:

- Prepaid cards ("PP cards")

- Merchant acquisition for CUP ("Merchant acquisition")

- Small and medium-sized entities ("SMEs") and International remittance

For the Group's internal reporting process, operating performance for SMEs and International remittance are assessed together and therefore, their segmental results are combined.

The directors consider that is neither possible nor meaningful to distinguish aggregate amortisation and depreciation, other administrative and operating expenses and taxation between the business segments, nor segmental net assets and liabilities. As a result these amounts are not reported to the chief operating decision maker on a segmental basis.

The Group is organised around two main geographical areas and a split of the geographical segments is as follows:

The major changes in segment assets during the year mainly relate to the decrease in property, plant and equipment and intangible assets for normal depreciation/amortisation, and in cash and cash equivalents as used in daily operations.

5 Exceptional impairment loss on trade receivables

In the year ended 31 March 2012, the Group recognised revenue of US$1,752,866 in respect of sales of 860 prepaid cards to a customer which was billed in February 2012. The revenue was recognised when the significant risks and rewards of the ownership have been transferred to the customers, which was taken as the time when the customer acknowledged the invoice and agreed to the terms of invoice, i.e., funds received were not refundable to the customer in any event and the cards were not returnable to the Group. As the customer agreed to the above terms, the Group considered the sales were concluded and thus revenue was recognised accordingly.

A provision against the US$1,752,866 was made on 30 September 2012 albeit management continued to pursue the collection of these funds. The directors have determined that there was no prospect that the outstanding balance will be recovered either in part or in full. Thus, impairment loss was made in respect of this trade receivable in the year ended 31 March 2013.

6 Other income

7 Staff costs

Staff costs, including directors' remuneration, are as follows:

During the year, the average number of persons employed by the Group is 32 (2013: 51), categorised as follows:

The total remuneration of the directors for each period is as follows:

Details of the directors' remuneration is disclosed in the Directors' Report on page 9.

8 Loss before taxation

Loss before taxation is stated at after charging/(crediting) the followings:

9 Taxation

Taxation in the consolidated statement of profit or loss and other comprehensive income represents:

Taxation of the Company and its subsidiaries is recognised based on the rules and regulations of their respective countries of incorporation.

Taxation in the consolidated statement of financial position represents: