Ann: Annual Report to shareholders, page-16

Just so we have all the facts. When a company makes a loss in the financial year, the auditors review current and future cashflows and make a determination as to whether they produce the audit of the business as a going concern.

In the case of SYT they have audited SYT on the basis that they are and continue to be a going concern with the following notes.

Notes to the financial statement.

1(c) Going Concern

The financial statements have been prepared on the goingconcern basis, which contemplates the continuity of normal business activityand the realisation of assets and the settlement of liabilities in the normalcourse of business.

As disclosed in the consolidated financial statements forthe year ended 30 June 2019, the Group incurred a net loss of $7,797,561 andcash outflows from operating activities of $6,742,650 for the year ended 30June 2019. These conditions indicate the existence of a material uncertaintythat may cast significant doubt about the Group’s ability to continue as agoing concern.

Notes to the consolidated financial statements

For the year ended 30 June 2019

Syntonic Limited | 30 June 2019 32

The ability of the group to continue as a going concern isdependent on securing additional funding through capital raising activities andsecuring of material revenue generating contracts to continue its operationaland marketing activities.

The directors are satisfied they will be able to raiseadditional working capital as required and thus it is appropriate to preparethe financial statements on a going concern basis. In arriving at thisposition, the Directors have considered the following:

 Successful capital raisings historically, including inApril 2019 with the Company completing a $5.38 million raising (before costs)by way of a $1.84m placement and $3.54m convertible note facility, of which$1.42m had been drawn down at 30 June 2019;

 Continued and demonstrated growth in revenue; and

 Prudent cost management.

Syntonic intends to replicate its success in Brazil acrossother growing, emerging markets where the group already has a presence and arecommitted to building critical scale through partnerships with premium contentproviders and aggregators.

Should the entity not be able to continue as a goingconcern, it may be required to realise its assets and discharge its liabilitiesother than in the ordinary course of business, and at amounts that differ fromthose stated in the financial statements. The financial report does not includeany adjustments relating to the recoverability and classification of recordedasset amounts or liabilities that might be necessary should the entity notcontinue as a going concern.