The notice to produce books that was served on ISX on 8 October was (according to ISX) relating to an ASIC investigation into whether ISX was complying with their continuous disclosure obligations. Now, not recognising revenue appropriately and in turn the perf shares vesting is one possibility in which they have not disclosed properly to the market.
Another possibility is that despite the revenue being genuinely obtained, ISX did not properly disclose at the time the nature of the revenue and allowed the market to think it was primarily from payments/acquiring/KYC, which it was not.
See attached a screen grab from the 'Analyst Breifing' preso in August 2018 - released on the ASX. The audio recording was previously available but now it isn't.
Intergration is quoted in that document as being less that 15% of revenue. Further, from my memory of listening to the recording a number of times, during the Q&A at the end, an analyst asks JK how much of the revenue from the last Q (being the June 18 Q) was from intergration. JK replies words to the effect, "We've quoted 15% in the presentation". This recording is now no longer available apparently.
Now the back and forth query letters with ASX have since shown that intergration revenue for the June 18 quarter was no where near being less than 15%, it actually made up the vast majority of revenue for that quarter. This appears to me to be a significant disclosure issue, especially given the perf shares vested in the same period, and might be what ASIC are looking at.
