In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price of the shares of Benitec Biopharma Limited (‘market conditions’). 

The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (‘vesting date’). 

The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the extent to which the vesting period has expired and (ii) the number of awards that, in the opinion of the directors of the group, will ultimately vest. This opinion is formed based on the best available information at reporting date. No adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the determination of fair value at grant date. 

No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition. 

Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not been modified. In addition, an expense is recognised for any increase in the value of the transaction as a result of the modification, as measured at the date of modification. Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the original award, as described in the previous paragraph. 

The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per share. 

## (s) Earnings per Share 

Basic earnings per share is calculated as net profit attributable to members of the parent, adjusted to exclude any costs of servicing equity (other than dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any bonus element. 

Diluted earnings per share is calculated as net profit attributable to members of the parent, adjusted for: 

• costs of servicing equity (other than dividends) and preference share dividends; 

• the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as expenses; and 

• other non-discretionary changes in revenues or expenses during the period that would result from the dilution of potential ordinary shares; 

divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element. 

## (t) Foreign Currency Transactions and Balances 

## Functional and presentation currency 

The functional currency of each of the Group’s entities is measured using the currency of the primary economic environment in which that entity operates. The consolidated financial statements are presented in 

Australian dollars which is the parent entity’s functional and presentation currency. 

## Transaction 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. 

## Group companies 

The financial results and position of foreign operations whose functional currency is different from the Group’s presentation currency are translated as follows: 

• Assets and liabilities are translated at year-end exchange rates prevailing at that reporting date. 

• Income and expenses are translated at average exchange rates for the period. 

• Retained profits are translated at the exchange rates prevailing at the date of the transaction. 

## (u) 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 Australian 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. 

## (v) Comparative Figures 

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

## (w) Going Concern 

The directors have prepared the financial statements on a going concern basis after taking into consideration the net loss for the year of $7,039,109 and the cash and cash equivalents balance of $31,359,199, The directors have recognised the capital raisings in 2013 and 2014, performed a review of the cash flow forecasts, considered the cash flow needs of the Group, and believe that the strategies in place are appropriate to generate funding which will be sufficient to maintain the going concern status of the Group. If these strategies are unsuccessful then the Group may need to realise its assets and extinguish liabilities other than in the ordinary course of business and at amounts different to those disclosed in the financial report. 

