A year of good progress delivers double-digit growth

NZX Announcement
28 May 2019
EROAD FY2019: A year of good progress delivers double-digit growth


EROAD Limited (ERD) results for the financial year to 31 March 2019:

Financial highlights (comparisons with FY18):
• Revenue increased to $61.4m, up 40%
• Operating costs were $45.7 million, up 38%
• EBITDA of $15.6m, up 48% compared to $10.5m (restated) in FY2018
• Total Contracted Units in New Zealand/Australia grew to 71,446, up 19%
• Total Contracted Units in North America rose to 24,944, up 40%
• Future Contracted Income grew to $117m, up 17%
• Net loss before tax of $5.1m, influenced by investment programme as well as changes to
accounting treatment
• Asset and customer retention rates remain strong at 94% and 98% respectively

Business highlights:
• Continued implementation of the investment programme enabling a scalable business ready for the
next level of growth. This was consistent with the strategic plan at time of Feb ’18 capital raise
• Maintained operational momentum as we refreshed our in-vehicle hardware design to decrease the
cost of manufacturing, increase scalability and enable 4G capability
• Talent capability was strengthened with key appointments and we undertook a major
refurbishment of our global headquarters, located in Auckland
• NZ: 46% of New Zealand’s heavy vehicle road user charges (HT RUC) dollars are being collected
using our technology and 54% of all HT RUC licences are issued through EROAD. Our solid pipeline
continues
• Australia: Re-launched into the Australian market establishing sales staff in key states and
operationally leveraging off the company’s New Zealand capabilities. EROAD’s gravitas in regulatory
telematics is proving attractive as Australia’s new Chain of Responsibility requirements are
increasing customer interest in telematics
• North America: Signed our first enterprise customer with completed installations anticipated within
first half of FY2020. Growth within the Small to Medium Business (SMB) business is growing steadily

Board Changes:
• Graham Stuart appointed chairmanship of EROAD’s Board of Directors in August, succeeding
Michael Bushby, who remains on the Board
• Susan Paterson was appointed to the Board in March 2019
• Gregg Dal Ponte stepped down from the Board in April 2019

Awards:
• EROAD included at #7 on the Deloitte Fast 50 Master of Growth New Zealand with 415% growth
between FY14 and FY18, and the Deloitte Fast 500 for Asia Pacific
• Received the internationally prestigious Brake Fleet Safety Award acknowledging EROAD’s positive

Page 2 eroad.co.nz
.

impact in creating safer drivers, vehicles and roads
• EROAD collected the Exporter of the Year to the USA ($1m to $10 m category) at the American
Chamber of Commerce in New Zealand AmCham DHL Express Success & Innovation Awards
• EROAD is a finalist in the EXPORTNZ Company of the Year, recognizing success by net return to the
New Zealand economy. EROAD is also a finalist for EXPORTNZ Intellectual Property Excellence in
Innovation, recognizing success in developing and commercializing innovation in international
markets. Winners of those two awards will be announced in June
• EROAD was a finalist for Company of the Year ($50m+) in the NZ Hi-Tech Awards

Chairman Graham Stuart says:
“This has been a year of good progress. The Board are impressed that strong business momentum has continued
alongside implementation of our key strategic initiatives, delivering a solid performance”.

“All significant milestones in the transition from start-up to established phases have been achieved and the company
is now well positioned for the next phase of growth”.

“We believe that decisions affecting our roads should be well informed through the masses of data that we can now
access and analyse. EROAD believes it has a role to play in making our roads safer and this is why we are
establishing growth incubators that will make a difference to our business and our communities.”

Chief Executive Steven Newman says:
“This year we’ve built a solid platform for future growth. We’ve made significant progress implementing the
investment programme set out in the strategic plan approved at the time of capital raise (Dec ’17 - Feb ’18),
ensuring we can scale efficiently, improve our customer experience and provide greater operating leverage.”

“In the past year, EROAD has supported journeys of more than 3.2 billion kilometres travelled by trucks and light
vehicles in New Zealand, Australia and the United States of America. More customers, more journeys, more data,
more knowledge for informed decisions. We must continually evolve the business to remain relevant in this
constantly changing environment.

“Maintaining this momentum requires continued innovation, exemplary service and sustained reliability. Preserving
these factors has required the programme of investment commenced during this past year.”

“EROAD is more robust and well positioned for sustained growth across all markets.”

“To drive on our roads should not require spinning the roulette wheel of life. It is heart-warming indeed to know
that what we do, what our products and services enable for our customers, also helps get more people home safely,
every night.”

Change in accounting treatment
As announced in EROAD’s half year results on 26 November 2018, EROAD has elected to adopt early the new
lease standard NZ IFRS 16 in conjunction with NZ IFRS 15 which was effective from 1 April 2017. While under
the existing lease standard NZ IAS 17 many of EROAD’s customer contracts meet the definition of a lease and,
therefore, lease accounting as a lessor was applied, these same contracts do not meet the definition of a lease
under NZ IFRS 16. The contracts would, therefore, be accounted for as service contracts under NZ IFRS 15.

This represented a significant change in the way the company recognises revenue and costs relating to its
contracts with customers. Most significantly, since the half year results, the company no longer recognises
upfront revenues for outright sales, installation services, sale of accessories or finance leases. EROAD now
recognises these revenue streams evenly over the contract term, typically over three years. Other impacts from
adopting the new accounting standards include a reduction in the capitalisation of costs associated with
establishing the customer contracts. Results presented in the full year report, as well as comparative numbers
for the last financial year have been restated to reflect these changes. More detail on this change is available in
the Financial Statements included within EROAD’s annual report.

Outlook for FY2020:
EROAD expects steady growth in New Zealand and North America to continue during FY2020.
This will come from continuing run rate SMB business as well as anticipated expansion with enterprise

Page 3 eroad.co.nz
.

customers. While the projected pipeline in Australia remains strong, investment will continue to run ahead of
revenue in the near to medium term.

The shift to more fuel efficient and alternate fuel source vehicles is creating an increasing deficit in
infrastructure funding, leading more regulatory authorities to consider road funding options.
With EROAD’s gravitas in regulatory telematics, there is an expectation that interest from regulatory
authorities in EROAD’s products and services will continue to grow.

Attached to this announcement are:
• Annual Report FY2019
• Investor Presentation FY2019
For further information:
Steven Newman Sue-Ellen Craig
Chief Executive Director of Communications
+64 9 927 4747 +64 21 577 685
Email: steven.newman@eroad.com Email: sueellen.craig@gmail.com

About EROAD
• EROAD believes every community deserves safer roads that can be sustainably funded. This is why EROAD develops technology
solutions (products and services) that manage vehicle fleets, support regulatory compliance, improve driver safety and reduce the
costs associated with driving. EROAD also provides valuable insights and data analytics to universities, government agencies and
others who research, trial and evaluate future transport networks. This data enables those who use the roads to influence the design,
management and funding of future transport networks.
• EROAD launched with the purpose of modernizing New Zealand’s paper-based road user charging system. By 2009 EROAD had
introduced the world’s first nationwide electronic road user charging system and now around 46% of collected heavy vehicle road user
charges in New Zealand are being collected using EROAD technology. By March 2019, this had delivered NZ$2.5B to NZTA for the
sustainability of the NZ transport network. In the USA EROAD introduced the first electronic Weight Mile Tax service (2014) and the
first independently verified Electronic Logging Device service (2017).
• EROAD (ERD) is listed on the NZX, employs over 250 staff located across NZ, Australia and North America.

Page 4 eroad.co.nz
.




EROAD Limited
Results for announcement to the market
Reporting period Year to 31 March 2019
Previous reporting period Year to 31 March 2018


Amount (000s) Percentage change
Revenue from ordinary
activities
NZ$61,352 40%
Profit (loss) from ordinary
activities after tax attributable to
security holders
NZ($4,915) 42%
Net profit (loss) attributable to
security holders
NZ($4,915) 42%

Final dividend Amount per security Imputed amount per
security
No dividend is proposed
Record date Not applicable
Dividend payment date Not applicable

Audit The financial statements attached to this announcement
have been audited.

Comments Refer to accompanying pages for commentary. Prior year
comparatives and percentage change has been updated to
reflect adoption of new accounting standards.

Net tangible assets per security 31 March 2019 31 March 2018
$0.55 $0.39


ENDS

---

EROAD
ANNUAL
REPORT
2019
20142018
2018
20102018

+24%
TOTAL
CONTRACTED
UNITS
+17%
FUTURE
CONTRACTED
INCOME
+40%
REVENUE
+48%
EBITDA
+40%
10
-
20
30
40
50
60
70
FY18FY19
$
43.8m
$
61.4m
REVENUE
+48%
-
5
10
15
20
FY18FY19
$
10.5m
$
15.6m
EBITDA
+17%
-
20
40
60
80
100
120
FY18FY19
$
100.5m
$
117.4m
FUTURE
CONTRACTED INCOME
+24%
-
20
40
60
80
100
FY18FY19
77.6k
96.4
k
TOTAL
CONTRACTED UNITS
FY19
Key Results
1
ANZ
Momentum
continues in

New Zealand
• Solid growth continues for the run-rate business in small-
medium (SMB) fleets, via both new customers

and upgrades.
• Health & safety offering continues to drive growth into
lighter vehicle segment.
2
ANZ
Australia

re-launch
• Re-launch plan successfully implemented.
• Launched specific products to address Australian
regulations leading to encouraging pipeline and inclusion
in funding trials.
3
NA
Focussed plan for

run-rate business,
first major enterprise
rolling out
• Moved to geo-vertical strategy to build a highly focussed
and sustainable run-rate business in SMB space.
• Targeting enterprise customers on a selective basis.
• Contracted largest customer to date, one of the largest
privately owned fleets in NA.
4
Global
Major investment

in leadership
• EROAD made a major investment in
leadership during FY19.
• The executive team is now fully established and positions
EROAD for continued growth across all markets.
5
Global
Investing for next
growth phase
• Substantial investments to enable scalable systems,
processes, improved customer service and operating
leverage.
• The established growth incubators for regulatory trials,
data insights and new ventures are gaining traction across
all markets.

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 201954
18–31
FINANCIAL
HIGHLIGHTS
2
06–17
CHAIRMAN’S REPORT
BOARD OF DIRECTORS
CEO’S REPORT
EXECUTIVE TEAM
1
56–105
AUDITOR’S REPORT
FINANCIAL STATEMENTS
4
32–55
ABOUT
EROAD
3
106–119
CORPORATE
GOVERNANCE
5
120–131
REGULATORY DISCLOSURES
OTHER INFORMATION
GLOSSARY
KEY DATES
6
KEY DATESTABLE OF CONTENTS
This is why EROAD develops
technology solutions (products
and services) that manage
vehicle fleets, support regulatory
compliance, improve driver safety
and reduce the costs associated
with driving. These are delivered
through a single platform, making
our products and services really
easy to use.
EROAD also provides valuable
insights and data analytics to
universities, government agencies
and others for the research, trial
and evaluation of future transport
networks.
EROAD believes that
every community
deserves safer roads
and the people who
use the roads should
influence the design,
management and
funding of transport
networks.

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 201976CHAIRMAN’S REPORT
Graham Stuart
Chairman
CHAIRMAN’S REPORT
I am pleased to present EROAD’s 2019 annual report and financial statements.
This has been a year of good progress. Your company has maintained double-digit
growth in revenue (40%), EBITDA (48%) and total contracted units (24%); while
simultaneously progressing with an investment programme that ensures EROAD has
solid foundations for profitable future growth.
In the pages that follow, you will read of our solid operational result and business
achievements in the 2019 Financial Year. The Board are pleased that Steven and his
team have been able to pursue significant strategic initiatives, while at the same time
maintaining solid operational momentum.
Last year EROAD achieved several significant milestones in
our journey from a start-up to an established market leader,
and we are now positioning ourselves for the next phase of
growth.
The addressable market for our services is large, growing
quickly and global. EROAD’s strategy is to operate in two key
geographies, Australasia and North America, focussing on a
specific set of customer needs: regulatory compliance, health
and safety and reliability. We believe that by pursuing this
focussed strategy EROAD can achieve leadership in these
markets.
Being high growth, this market is also well contested and
subject to near constant disruption. Securing a leadership
position will require ongoing investment in innovation and
development, firstly to retain our existing customers and then
to attract new customers. Our highly capable engineering
resources retain this focus.
The key challenge for the business in this next phase is
to make the most of our organic growth opportunities,
by growing revenues faster than the overall market for
commercial vehicle telematic solutions. We will also consider
non-organic growth initiatives when and where appropriate.
This past year has been one of refining our focus and
investing to ensure that EROAD’s business model is scalable
to manage our next phase of growth.
In the 2020 Financial Year we are looking to successfully
complete the initiatives started last year and to continue
building strong growth.
The team at EROAD share a passion for making our roads
safer and more productive. We believe that decisions
affecting our roads should be well informed through the
masses of data that we can now access and analyse. EROAD
believes it has a role to play in making our roads safer and this
is why we are establishing growth incubators that will make
a difference to our business and our communities. Dynamic
Risk, an innovative research methodology that uses real data
to identify high risk areas on our roads, is a good example of
how we are doing this. Dynamic Risk is already receiving high
interest from academia and transport authorities.
BOARD UPDATE
Your Board has worked diligently this past year and I want to
thank my colleagues for their support and their insights. Over
the past 12 months the Board has undergone several changes.
In August Michael Bushby stepped down as Chairman and
remains on the Board. Having chaired the Board for six
years Michael felt it an opportune time for the leadership to
transition now that the company has progressed from start-
up mode to generating self-sustaining cash flows.
In March Gregg Dal Ponte signalled his intention to retire from
the Board at the end of April 2019. I want to thank Gregg
for his service to EROAD. During his tenure the foundations
for the future success of our North American business were
laid; we exceeded 20,000 installed Ehubo units, won our first
major enterprise client and reached the important financial
milestone of being EBITDA positive.
In March we welcomed Susan Paterson to the Board. Susan
brings a wealth of experience in business and governance.
I would like to thank the leadership team and most
importantly our people for their diligent work over the past
year. The Board is acutely aware that the upward trajectory
of the business is underpinned by the commitment of
EROADers and is deeply appreciative of their contribution.
Our annual meeting this year will again be held at the QBE
Events Centre in Albany on 1 August at 4:45pm, I look forward
to seeing you there.

Graham Stuart, Chairman
A year of good progress

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 201998
BOARD OF
DIRECTORS
BOARD OF DIRECTORSBOARD OF DIRECTORS

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20191110
GRAHAM STUART
Chairman, Member of Remuneration, Talent
and Nomination Committee.
Graham joined the EROAD Board in January
2018 and was appointed Chairman in August
of the same year. He was previously CEO
of Sealord Group, CFO then Director of
Strategy & Growth at Fonterra and has had
extensive business experience in South East
Asia, Europe, the UK and Latin America.
MICHAEL BUSHBY
Independent Director, Member of
Remuneration, Talent and Nomination
Committee and Finance, Risk and Audit
Committee.
Michael stepped down as Chairman in
August 2018, having led the Board since
2012. Michael is based in Australia where
he is a consultant at WSP Australia and
previously held roles as General Manager of
the Ventia Asset and Infrastructure Services
division and CEO at the Roads and Traffic
Authority in New South Wales.
TONY GIBSON
Independent Director, Chairman of the
Remuneration, Talent and Nomination
Committee and Member of Finance, Risk and
Audit Committee.
Tony is the Chief Executive of Ports of
Auckland and one of New Zealand’s most
experienced transport professionals. He
has worked in various senior management
roles in Africa, Asia and Europe. In 2008 the
Minister of Transport appointed him to the
Road User Review Group. Tony joined the
Board in October 2009.
BOARD OF
DIRECTORS
BOARD OF DIRECTORS
CANDACE KINSER
Independent Director, Member of
Remuneration, Talent and Nomination
Committee and Finance, Risk and Audit
Committee.
Candace is an experienced director, CEO
and Tech entrepreneur. She was previously
the CEO of the NZ Technology Industry
Association and the CEO of science software
company Biomatters. She is a Director of
companies including Talent International,
Livestock Improvement Corporation, WEL
Network Limited and Ultrafast Fibre Limited.
Candace joined the Board in April 2014.
SUSAN PATERSON
Independent Director, Chair of the Finance,
Risk and Audit Committee, Member of
Remuneration, Talent and Nomination
Committee.
Susan joined the Board in March 2019. She
is an appointed Officer of New Zealand
Order of Merit (services to governance) and
currently chairs Steel and Tube Holdings
and IT consultancy Theta Systems. She is
a director of the boards of the Electricity
Authority, Arvida Group, Goodman New
Zealand, Les Mills Holdings and Sky Network
Television.
STEVEN NEWMAN
Executive Director / CEO
Steven has been EROAD’s chief executive
and a member of the EROAD Board since
2007. He co-founded Navman where
his COO and CEO roles provided the
opportunity for him to establish Navman
as a leading international brand delivering
annual sales in excess of NZ $500m.
GREGG DAL PONTE
Independent Director, Member of
Remuneration, Talent and Nomination
Committee.
US-based Gregg joined the EROAD Board in
July 2016, resigning effective 30 April 2019.
Gregg was previously the Administrator
for the Oregon Department of Transports
Motor Carrier Transportation Division and a
Director of Regulatory Compliance for the
Oregon Trucking Association.
BOARD OF DIRECTORS

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20191312CEO’S REPORT
Steven Newman
CEO
To drive on our roads
should not require spinning
the roulette wheel of life.
It is heart-warming indeed
to know that what we do,
what our products and
services enable for our
customers, also helps get
more people home safely,
every night.
Steven Newman
CEO, EROAD
CEO’S REPORT

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20191514
This year we’ve built a solid platform for future growth. We’ve made significant progress
implementing the investment program set out in the strategic plan approved at the time of capital
raise (Dec ‘17- Feb ’18), ensuring we can scale efficiently, improve our customer experience and
provide greater operating leverage.
And here’s why:
• Ten years ago, we introduced the world’s first nationwide electronic
road user charging (ERUC) system. Now, more than 46% of New
Zealand’s heavy vehicle RUC dollars are collected through EROAD
attracting interest from those researching or trialling funding options
for transport networks.
• Ten years ago, we were a domestic company with one product and
less than 50 staff. Now, we have customers and staff across three
markets, expanding our offerings in compliance, fleet management
and health and safety.
• Over the past year, EROAD has supported journeys of more than
3.2 billion kilometres travelled by trucks and light vehicles in New
Zealand, Australia and the United States of America. More customers,
more journeys, more data, more knowledge for informed decision
making. We must continually evolve the business to remain relevant in
this constantly changing environment.
It was Andy Warhol who said: “They always say time changes things,
but you actually have to change them yourself”. Over time, our
customers have grown - some exponentially increasing their fleet
sizes, some new to the value of telematics. A range of new regulatory
requirements have also been expanded or introduced. That’s why we
must adapt/evolve our business, so that we can scale efficiently to
address the needs of our customers, communities and stakeholders.
We are improving safety on our roads because our products and
services support better driving. I believe we can state that because
we have customers who are seeing impressive reductions in the
number of incidents occurring: “Our over-speed incidents have
reduced by 83%”, “Our incident rate reduced by almost 90%

immediately after installation” are just a couple of examples that we
hear from our customers. To drive on our roads should not require
spinning the roulette wheel of life. It is heart-warming indeed to know
that what we do, what our products and services enable for our
customers, also helps get more people home safely, every night.
While we invest for the future, we continue to grow. In the past
year our revenue rose to NZ$61.4m, EBITDA was up 48%, our total
contracted units grew to 71,446 (ANZ) and 24,944 (NA) and our
pipelines remain encouragingly strong within all three markets.
Our growth continues through regulatory disruption, because fuel
taxation revenues are under pressure and safety on our roads needs
to get better. EROAD has significant gravitas in this field, having
pioneered the world’s first nationwide electronic Road User Charging
system (NZ), the first electronic Weight Mile Tax service (USA) and
the first independently verified Electronic Logging Device (USA) to
manage driver fatigue.
In summary, maintaining this momentum requires continued
innovation, exemplary service and sustained reliability. Preserving
these factors has required the programme of investment commenced
during this past year.
EROAD is more robust and well positioned for sustained growth
across all markets, validating your continued support.
Steven Newman, CEO
Continued innovation, exemplary
service and sustained reliability
CEO’S REPORTCEO’S REPORT
The investment we have been implementing during 2019 has already delivered:
• New staff with strong track records in their respective fields.
Our leadership team has been strengthened and other key
appointments have been made to deepen marketing, sales,
finance, product and R&D capability, as well as establish
leadership teams for each country. This investment ensures
excellent bench strength to deliver our future growth.
• A refresh of our in-vehicle hardware design to decrease the
cost of manufacturing, increase scaleability, and enable 4G
capability. This investment is key to delivering on our future
growth plans in all markets.
• We have commenced implementation of scalable business
systems and processes that ensure we can scale efficiently,
improve the customer experience and provide greater operating
leverage. With continued strong growth rates planned, these
improvements are essential.
• A major refurbishment of our global headquarters, located
in Albany, Auckland, to ensure a modern and effective space
that supports a range of flexible working styles, enhancing
collaboration and allows EROADers to work their magic.
• A successful re-launch into the Australian market. We have
recruited a strong, core sales team in key states, operationally
leveraging off our New Zealand business. The suite of new
regulatory requirements within Australia has unlocked
opportunities for telematics within industries that have
previously not had cause to invest.
• The strategic refresh for North America during the first half of
FY19 created a geo-vertical sales strategy. This enables higher
ROI as efforts are prioritised within the product suites and
US states where our regulatory telematic reliability provides
a competitive advantage. We continue to take advantage
of the evolving market post the ELD deadline, with our ELD
being rated number one by users on ELDratings.com. We have
engaged third party telemarketing for commencement in May
2019.
In addition to those investments, our strong business momentum continued as evidenced
through these achievements:
• We welcomed a wealth of new customers that have included St
John Ambulance Services, Linfox, Fliway, Coca Cola Amatil NZ
Ltd, and our first enterprise customer in North America.
• Our existing customers remained loyal, giving us an industry-
leading customer retention rate of 98%, due to the benefits our
system delivers to their business. Benefits that enable them to
improve service to their own customers, as well as improve the
safety of those driving on our roads.
• We continued to receive international recognition. In the past
year we appeared in the Deloitte Fast 50 Master of Growth and
the Fast 500 for Asia Pacific. We received the prestigious Brake
Fleet Safety Award acknowledging EROAD’s positive impact
in creating safer drivers, vehicles and roads. We collected the
Exporter of the Year to the USA ($1m to $10m category) at the
American Chamber of Commerce in New Zealand AmCham
DHL Express Success & Innovation Awards. We are a finalist in
the EXPORTNZ Company of the Year, recognizing success by
net return to the New Zealand economy, as well as a finalist
for EXPORTNZ Intellectual Property Excellence in Innovation,
recognizing success in developing and commercializing
innovation in international markets. Winners of those two
awards will be announced in June.
There is an increasing deficit in infrastructure funding with the shift to more fuel efficient
and alternate fuel source vehicles. By March 2019, EROAD technology had collected
NZ$2.5B on behalf of NZTA for the sustainability of the NZ transport network.
• Our relationships with those researching or trialling road
funding or safety regulations have continued to expand
throughout the year. EROAD is now represented on two of
North America’s Transportation Research Board committees.
These draw on international research expertise to solve complex
transport problems, and accordingly membership is only
extended to those considered top in their fields. Our analytical
data research is circulated by the Australian Research Institute.
• Our staff (affectionately referred to as EROADers) are
welcomed into the US Senate, Australian State and Federal
government as well as both local and central government
departments in NZ for discussions on how our technology
can enable safer roads as well as the sustainable funding of
transport networks.
• EROADers have been invited to present at transport,
infrastructure, technology and safety conferences across all
three of our markets. These are all testament to the depth of
talent that exists within our staff, and I am so very proud of
what they collectively achieve.

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20191716
EXECUTIVE
TEAM
TOP (left to right) Matt Dalton, Norm Ellis,
Tony Warwood, Steven Newman, Alex Ball, Pip Gilbert
BOTTOM (left to right) Mike Sweet, Jarred Clayton,
Mark Heine, Genevieve Tearle
EXECUTIVE TEAM
STEVEN NEWMAN • CEO / Director
Steven has led and inspired the organisation since 2007. Previously Steven co-founded Navman
where his COO and CEO roles provided the opportunity for him to establish Navman as a
leading international brand within the Marine Electronics, Fleet Tracking, Precision GPS Modules
and Consumer Car Navigation sectors.
ALEX BALL • Chief Financial Officer
Alex joined EROAD in January 2019 and is responsible for delivering a competitive business that
delivers shareholder value. His previous roles include CFO at some of NZ’s largest companies
including Transpower, TelstraClear and Vector as well as working for a leading accountancy firm
here and overseas.
JARRED CLAYTON • Chief Technology Officer
Jarred leads product, design and engineering at EROAD and is responsible for ensuring that
our technology strategy is future-focused and solves customer problems. He has held several
leadership roles since joining EROAD back in 2008, bringing extensive leadership experience
gained in product and consulting companies in the UK, America and Australia.
MATT DALTON • EVP Operations
Matt joined EROAD in March 2019 to focus on delivering cohesive operational procedures across
EROAD’s global markets for both supply chain and business systems. Matt was previously at
Yellow New Zealand.
NORM ELLIS • President North America
Norm joined EROAD in 2017 to lead our North American business. He was previously COO at ID
Systems, Inc., a producer of wireless asset management systems for the transport sector. Prior to
that he led sales, services and marketing for Omnitracs in the US and Canada for nearly 17 years.
PIP GILBERT • EVP Strategy
Pip is responsible for framing the strategic choices and challenging the status-quo to drive
EROAD’s long term success. She has held both strategy and product leadership roles since
joining EROAD in 2016. Previously, Pip led innovation, partnerships and strategy at The Icehouse
and brings a strong background in customer insight and market research.
MARK HEINE • EVP General Counsel and Company Secretary
As General Counsel and Company Secretary, Mark works with the team on all aspects of
company and product legal compliance and data privacy. Mark joined EROAD in 2015 after a
legal career working at Bell Gully in Auckland and Allens in Sydney.
MIKE SWEET • Chief People Officer
Mike joined EROAD in January 2019 to lead people and culture development. His global HR
work experience includes NZ, Australia, the UK and the USA. His strong affinity for software
and technology sees him providing strategic HR advice to some of NZ’s leading tech growth
companies. Mike’s most recent role was General Manager HR at Spark.
GENEVIEVE TEARLE • Chief Marketing Officer
Genevieve joined EROAD in October 2018 and is responsible for developing capabilities in
marketing strategy, demand generation, and product marketing management. She has
previously held key marketing roles in global corporates like Philips and Fisher & Paykel, working
across Europe, Asia, and Americas in both B2C and B2B environments.
TONY WARWOOD • General Manager Australia & New Zealand
Tony leads our ANZ business, delivering great customer service and business growth both
sides of the Tasman. He joined EROAD with our first customers back in 2009, having previously
worked in the heavy transport industry.
EXECUTIVE TEAM

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20191918FINANCIAL HIGHLIGHTS
FINANCIALHIGHLIGHTS
FINANCIAL HIGHLIGHTS

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20192120
AUSTRALIA &
NEW ZEALAND
FINANCIAL HIGHLIGHTS: ANZ
8000% record
retention
+19%
Growth in Units in ANZ
8,000+
RECORD RENEWALS
Units renewed
(of which 3,000+ upgraded to Gen 2)
46%
HT RUC $ IS COLLECTED
through EROAD technology in New Zealand
$2 7. 3m
EBITDA
Launched
Fringe Benefit Tax
EROAD Product in Australia
Australian
Market Re-launch
Initial re-launch initiatives according to plan
FINANCIAL HIGHLIGHTS: ANZ
Key Achievements

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20192322
New Zealand
EROAD’s customer base
classified as enterprise
40%
all HT RUC Licences
issued through EROAD
54%
• ANZ EBITDA of $27.3m
• Continued solid growth in the SMB run-rate business.
• Largest customers continue to get larger. Approximately 40% of
EROAD’s customer base in NZ is now classified as enterprise.
• Light vehicle and asset tracking opportunities continue to grow,

reflecting Health & Safety regulatory trends and customers
recognising the commercial benefits of telematics.
• High number of renewals (8k+) and upgrades (3k+) to second
generation hardware.
• NZ generates significant operating cash flows which funds R&D
investment and expansion of newer markets.
1
Grow through retention
and account expansion
2
Continue expansion into
safety conscious market
3
Leverage network into
new opportunities
• Provide upgrade pathways and value
added services to increase lifetime
value.
• Future product releases focused on
next generation experiences.
• Leveraging our ease of use, reliability
and market penetration.
• Continue to amplify demand
generation.
• Leverage new and existing
partnerships to increase sales across
their customer bases.
• EROAD will consider opportunities
to create and/or obtain innovative /
complementary product offerings.
• Develop new products and services
using network insights and in
collaboration with our customers and
stakeholders.
EROAD fleet tracking
is fantastic. It’s creating
more and more
information that’s really
beneficial to our fleet.
Crown Relocations • New Zealand
FINANCIAL HIGHLIGHTS: NEW ZEALANDFINANCIAL HIGHLIGHTS: NEW ZEALAND
Go-to Market Summary

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20192524
AU CUSTOMER QUOTE
FINANCIAL HIGHLIGHTS: AUSTRALIA
EROAD re-launched into the
Australian market in October 2018
Australia
1
Build sustainable
run-rate business in SMB
space
2
Pursue selective
enterprise opportunities
3
Manage cost base for
efficiencies in growth
• Focused on under served market
segments with product-market fit.
• Near term product releases focussed on
high value opportunities to deliver ROI.
• Leveraging our accuracy, ease of use
and reliability.
• Leverage NZ reference accounts
into parent companies and areas of
industry strength.
• Position EROAD to take advantage of
rapidly evolving compliance burden on
businesses that operate fleets.
• Leverage NZ operations to accelerate
an efficient operating model.
• Amplify leading service and support.
Go-to Market Summary
FINANCIAL HIGHLIGHTS: AUSTRALIA
Progressing to plan
• Investments made to establish a solid
foundation, including a comprehensive
market review.
• Initial hires into Australian based

sales team.
• Australian FBT and posted speed

products launched.
• Australian marketing campaigns and

lead generating activity commenced.
• Management is encouraged by

early interest and pipeline.
Market Opportunity
• Chain of Responsibility regulatory changes
driving higher adoption rates for telematics

in Australia.
• Testimonials are highly referenceable

trans-Tasman.
• EROAD is leveraging capabilities and
resources in its NZ business, requiring
significantly lower market entry investment.
EROAD has made
us more proactive in
keeping the trucks
safe. Maintenance is
simpler to manage
and we’re able to
keep on top of things
a lot more easily.
Conroy Removals • Australia

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20192726FINANCIAL HIGHLIGHTS: NORTH AMERICA
NORTH
AMERICA
FINANCIAL HIGHLIGHTS: NORTH AMERICA
+40%
Growth in NA Units
EBITDA Positive
NA positively contributing to group
EBITDA & operating cash flows
First Enterprise
Account Win
Approx. 4.9k units
signed in March 2019
Refined
Geo-vertical Focus
Focussing sales, marketing
and R&D investment
Strengthened Local
Management
Strengthened local management
team to drive further growth
#
1 Rated ELD
by users on ELDratings.com
and #2 by independent reviewer
Key Achievements

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20192928
AU CUSTOMER QUOTE
• Achieved 20k unit milestone in August 2018.
• EROAD’s US business is now producing positive operating
cash flow and EBITDA on a monthly basis.
• First significant enterprise fleet signed – one of the largest
privately owned fleets in North America, requiring approx.
4,900 units (full benefits will be realised in FY20). This
expands our addressable market beyond our market entry
target of <200 vehicles per fleet.
• We continued to grow the underlying SMB run-rate
business through a more focussed geo-vertical go-to-market
strategy.
• Future potential enterprise opportunities will be evaluated
to ensure there is strong product and customer fit.
• EROAD is playing selectively in the US AOBRD to ELD
transition (required by Dec 2019) where there is a strong
product fit and limited bespoke R&D development necessary.
1
Build sustainable
run-rate business in
SMB space
2
Pursue selective
enterprise opportunities
3
Consider strategic
growth opportunities
• Tightly focussed geo-vertical approach.
• Near term product releases dictated by
geographic and vertical focus.
• Leveraging our accuracy, ease of use

and reliability.
• Establishing our demand generation
framework.
• Third party telemarketing.
• Large enterprise account win provides
strong reference account for larger
prospects.
• Selectively targeting enterprises, only
where a close fit exists with minimal
requirements for customisation.
• During 1H19, actively pursued target
which didn’t eventuate following detailed
due diligence.
• EROAD will continue to consider
inorganic growth opportunities to
broaden customer base or introduce
innovative and complimentary offerings.
FINANCIAL HIGHLIGHTS: NORTH AMERICAFINANCIAL HIGHLIGHTS: NORTH AMERICA
With EROAD, we are saving a few thousand dollars per month in administrative
time for fuel tax reporting and realizing fuel tax savings of at least $200,000
annually based on the ability to accurately capture and track off road mileage.
EROAD data has also led to a 7% reduction in insurance premiums and savings of
$3,000 per month with its inspection and maintenance recordkeeping capabilities,
as well as fewer violations and lower fines. Overall, the ROI for us on EROAD is
almost immediate.
Beyond providing capabilities for tracking, compliance and a range of functions,
EROAD generates detailed reports that lead to monumental operational benefits
for us. While the system is the source of better productivity and compliance in
our operation at a lower cost, EROAD, more than any of the 12 other suppliers we
evaluated, was willing to work with us to build a customized solution that meets
our specific needs.
Recoil Oilfield Services • USA
North AmericaGo-to Market Summary

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20193130FINANCIAL HIGHLIGHTS: CORPORATE
Corporate
• EROAD’s continued growth in international footprint and scale of operations has
led to investing in strengthening management capability, improving processes
and business systems to support future growth.
• This investment in increased executive capability has seen several highly
experienced senior managers join the business during FY2019.
• As outlined in the FY2018 capital raising, EROAD has commenced an ongoing
programme of implementing new business systems to enable it to scale more
efficiently, improve the customer experience and simplify operational processes,
drive greater leverage of operating expenses. An element of upfront costs
relating to this project were incurred as operating expenses prior to the full
capital project commencing.
• The FY2018 capital raising also outlined plans to increase the level of R&D
spend and this has increased on the prior year reflecting the growing number of
products and services provided by the business and growth into new markets.
In addition, FY2019 saw an increased proportion of this spend being expensed
rather than capitalised.
• EROAD continues to keep an active interest in inorganic growth opportunities
that add value to the group through additional subscriber base, complementary
technology or improved distribution. During FY2019 EROAD incurred a level of
costs investigating a significant opportunity that ultimately did not progress.
FINANCIAL HIGHLIGHTS: CORPORATE

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20193332
EROADABOUT
ABOUT EROADABOUT EROAD

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20193534
COMPLIANCE
2009 / Launch2019 / Present
AUTO RUC
OFF-ROAD
CLAIMS
DAILY DRIVER
ACTIVITY
SERVICE SCHEDULING
AND ALERTS
SERVICE
RECORD HISTORY
OUTSOURCED REPAIR
SERVICE ACCESS
FUEL
MANAGEMENT
IDLE
REPORT
DAILY FLEET
ACTIVITY
GEOFENCE
SITE ACTIVITY
FLEET MANAGEMENT
COMPLIANCE
SPEED
MONITORING
SAFETY EVENT
MONITORING
CHAIN OF
RESPONSIBILITY
INTEGRATED
DVIR WORKFLOW
LEADERBOARDDRIVER
INSIGHT
ELECTRONIC
LOGBOOK
DRIVER
CERTIFICATIONS
FRINGE
BENEFIT TAX
FLEET MANAGEMENT
HEALTH & SAFETY
COMPLIANCE
IFTA
EASY FILE
ELECTRONIC
IRP
ELECTRONIC
OREGON WMT
ELECTRONIC
OREGON RUAF
EROAD
SHARE
E-TRACK
WIRED
PROOF OF
SERVICE
IFTA FUEL
TRIP RECORDS
TRIP
INVESTIGATOR
PARTNER
INTEGRATIONS
EASY-TO-USE
ELD
We continually launch
innovative products and
services that meet the
needs of our customers
and stakeholders.
Complexity made simple through EROAD’s one platform
EROAD’s in-vehicle telematics solution (EHUBO) collects data from the vehicle which is then transmitted via a
secure cellular link and appears in a cloud-based web portal (Depot), for customer access and easy reporting
ABOUT EROAD
CONTINUOUS
INNOVATION
ABOUT EROAD
REGULATORY
+
COMMERCIAL
Vehicle Records
Automatically
generate and
submit required
trip data as well as
integrated DVIR
reporting
Driver Management
Useful information
directly to drivers
that helps reduce
speed, harsh braking
and incidents.
Health & Safety
Detailed reports
on individual driving
behaviours, safety
incidents and trends
for objective
data-driven coaching.
Road Funding
EROAD’s superior
accuracy and
reliability is why
government agencies
accept reports
generated
through our systems.
Fleet
Management
Reduce your driving
costs and improve
service levels across
any vehicle, fleet
size or industry.
Vehicle Health
Service Record
History & Outsourced
Repair Service Access
Communication
Our systems
were designed
to reduce
paperwork,
making them
really easy to use.
Data Analytics
We believe the
people who use the
roads, should
influence the design,
management
and funding of the
roads.

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20193736
1978
2007
Regulatory HistoryEROAD growth timeline
Road User Charges (RUC) legislation was
implemented to collect road funding from vehicles not
paying petrol tax. This was supplemented by further
legislation requiring regular vehicle safety inspections
(Warrant of Fitness or Certificate of Fitness) and
enforced by NZ Police. Drivers would record their
odometers manually on paper forms.
EROAD is commercially founded
EHUBO, EROAD’s electronic
distance recorder obtains patent
and field trials commence in NZ
2008
McCarthy’s becomes
EROADs first customer
with multiple units
2009
EROAD introduces the world’s first
nationwide, GPS based electronic
road user charging (ERUC) system
MoT approves EHUBO, making this NZ’s
first approved electronic distance recorder
EROAD wins its first awards for business
and technology
2010
EROAD undertakes first North
American commercial pilot of a
GPS based road charging platform
2012
EROAD reaches 100 staŽ (aŽectionately
referring to themselves as EROADers)
EROAD makes its first appearance in the
Deloitte Technology Fast500 for AsiaPacific
EROAD electronic weight-mile tax solution
receives independent unqualified opinion from
Oregon Secretary of State Audits Division
EROAD launches commercial services into
North America and Australia, establishing
a US o“ce in Portland, Oregon
EROAD launches first electronic Weight
Mile Tax service (USA)
EROAD lists on New Zealand Stock
Exchange, trading as ERD
EROAD’s electronic log book first to be
approved by NZTA
EROAD electronic IFTA service
launched into North America
EROAD becomes largest channel for
collection of heavy vehicle eRUC in NZ
201320152014
2009
EROAD delivers a significant
technology milestone proving it is
feasible to introduce road charging
across an entire jurisdiction
without intrusive and expensive
roadside infrastructure
2010
NZ Legislation permits use of electronic
distance recorder. This replaced manual
odometer recording with GNSS-based
distance recording or, for heavy vehicles,
mechanical hubodometers
Second generation product launched (EHUBO2)
EROAD chosen as sole heavy vehicle technology
provider for California Road Charge Pilot
EROAD opens sales o“ce in Christchurch, NZ
80% of NZ’s heavy vehicle ERUC is collected using EROAD technology
EROAD develops the analytical model ‘Dynamic Data’, enabling transport planners
to use real (instead of modelled) data for transport network design and evaluation
EROAD opens product refurbishment factory in Penrose, NZ
250 EROADers located across three markets (NZ, North America & Australia)
EHUBO2.2 the revised unit with 4G capacity, launches
EROAD launches USA’s first independently verified
FMCSA registered electronic logging device (ELD)
EROAD selected as sole heavy vehicle technology
provider for USA’s first multi-state RUC pilot
More than 50% of NZ’s heavy vehicle RUC is being
collected electronically
EROAD sales reach 100,000 units
EROAD comes of age, gaining enterprise accounts in all markets (NZ, North America & Australia)
EROAD oce refurbishment of Albany oces creates Global/ANZ HQ based in Albany, Auckland NZ
2012
RUC legislation is
reviewed establishing
greater accountability,
better governance and
reporting processes
2016
2016
2017
Health and Safety at Work Act (HSW Act) came in
to eŽect placing greater responsibility on
organisational leaders. The purpose of this act is to
reduce New Zealand’s workplace injury and death
toll by 25 per cent by 2020
2018
2018
2019
2019
Total Electronic RUC collection
overtakes paper collection
Approx 750,000 vehicles pay road taxes through RUC, including 600,000 light vehicles. Light electric
vehicles are currently exempt until December 2021, heavy electric vehicles are exempt until December 2025
RUC administration is now more electronic than paper-based: 50% of HT RUC Dollars, 67% of HT Licenses,
and 51% of HT KMs travelled, are all recorded electronically
Funding delivered through RUC continues to increase year on year. Since launching, more than NZ$2.5
billion RUC funding has been collected through EROAD technology

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20193938
Health and Safety
Health and Safety has been at the core of our values since our
inception as a company and remains a key area of focus for us in
terms of product development, competency development and
company culture.
Health and Safety and Chain of Responsibility regulatory developments in New Zealand and
Australia have further resulted in us building a suite of products and services that support
health and safety regulatory compliance, reporting, and driver safety.
The introduction of Drive Buddy, Virtual Speed Camera, Driver Leaderboard, electronic
logbook, and vehicle monitoring all aid compliance reporting, and have resulted in reductions
in overspeed events in our customers’ fleets.
Driver Login and Posted Speed have both been enabled by the in-vehicle telematics device
we developed (Ehubo2) which provides information to drivers that has been shown to reduce
speed, harsh braking and safety incidents through in vehicle feedback to the driver.
New Zealand reduction in speed
Frequency (events per 100km)
Driver Leaderboard
TM
Driver Login
TM
Posted Speed
TM
Overspeed Dashboard
TM
Drive Buddy
TM
47%
SPEED EVENTS
The above graph shows the reduction in over speed events
over time as product enhancements have been added.
Our SaaS software solution further contributes to enabling safety outcomes in our customer
fleets. Driver Leaderboard in Depot enables our customers to have driver coaching
conversations with their drivers to improve driver safety outcomes. It provides a means by
which good performance can be rewarded by employers, and training and support can be
provided where necessary.
Internally, our safety and wellbeing professionals play a key role in delivering health and safety
programmes and providing expertise and support to EROAD’s operations in New Zealand,
North America and Australia. EROAD’s safety risk assessment process brings focus to safety,
driving a reduction in injuries and stress through a continual focus on the mental and physical
safety of our employees. Our safety and wellbeing professionals also work with our customers
to aid in the design of their safety processes in a continuous improvement approach to
improving safety outcomes both at EROAD and across our customers operations.
In 2018 EROAD received the Brake Fleet Safety Award acknowledging EROAD’s positive
impact in creating safer drivers, vehicles and roads.
Leaderboard gives us all the names of the
drivers and how they perform through the week.
I keep a record of it so I can see how I perform
and how other drivers perform – because I’m
involved with their health and safety.
It’s all about driving safely and getting home
safely. That’s why you should have EROAD.
Machinery Movers • EROAD Customer, New Zealand
The EROAD installation was the easiest and
most successful vehicle technology roll out
in to the St. John fleet.
This was due to the flexibility of EROAD, their
structured approach and their seamless work,
with our Infrastructure Managers and Install
Co-ordinators.
St. John • EROAD Customer, New Zealand
Ehubo2: Driver LoginDepot: Driver Leaderboard
ABOUT EROADABOUT EROAD

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20194140
Sizeable decline in over-speed events with customers
who have actively implemented ‘Safe Driver’
16
14
12
10
8
6
4
2
Foodstus North Island: Owner Drivers
Average number of speeding events per 100km travelled
EHUBO2 SAFE DRIVER
upgrade plan commenced
Jan 2017Jul 2017Jan 2018Jul 2018Jan 2019
83%
SPEED EVENTS
1
2
3
4
5
Foodstus North Island: Company owned vehicles
Average number of speeding events per 100km travelled
EHUBO2 SAFE DRIVER
upgrade plan commenced
Jan 2017Jul 2017Jan 2018Jul 2018Jan 2019
85%
SPEED EVENTS
and consistently sit below 0.3 events per 100km
0.8
1.0
1.2
1.4
1.6
1.8
2.0
2.2
2.4
2.6
TIL Freight: Average number of speeding events per 100km travelled
EHUBO2 SAFE DRIVER
upgrade plan commenced
Jul 2017Jan 2018Jul 2018Jan 2019
89%
SPEED EVENTS
immediately after installation
EROAD has so far brought down our over
speed events from approximately 25,000
a month to about 1200.
It’s reduced our overall fuel bill by
approximately 20% and accident incident
rates by 20%.
McConnell Dowell • EROAD Customer, New Zealand
ABOUT EROADABOUT EROAD

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20194342
23.9%
less distance
45.8%
higher risk of trac incident
Varying Drive TimesVarying Risk
Using big data for safer roads
Our data and analytics team, working collaboratively with Oregon State University, has
created a new data algorithm called Dynamic Risk, using real data (as opposed to modelled
data). This will enable transport authorities to make efficiently informed spending decisions to
improve road safety.
Driver behaviour gathered from over 9.5 million trips and collected through EROAD
technology was anonymized, aggregated then analysed through an innovative algorithm that
has resulted in a new way of accurately identifying risk.
“We wanted to create a model that could predict where crashes were most likely to occur
so that preventative measures could be implemented before those areas became known as
high-crash risk areas” said EROAD’s Director of Analytics Gareth Robins. “When compared
to traditional methods of risk analyses, our technology and new algorithm is an efficient and
effective way of comparing multiple factors gathered from a range of vehicle types, unlocking
information previously unavailable on how our roads are being driven”.
The research was conducted using data from New Zealand and looked at fatigue, frustration
and familiarity, then compared these factors across the five classes of New Zealand roads.
When choosing to travel between Rotorua and Taupo one route has 23.9% less distance but
exposes the driver to 45.8% higher risk of being involved in a traffic incident (indicated by red
on the map).
Sustainability
The data insights provided by EROAD help our customers achieve
greater fuel efficiency, subsequently reducing emissions.
EROAD’s fleet management solution compares fuel records and displays average and total idle
time by vehicle enabling conversations with drivers around reducing idle times, and inefficient
fuel usage. By monitoring idle events and tracking driver behaviour, we not only provide
our customers with improvements to their bottom line but also help lessen their businesses’
impact on the environment.
During 2018 we moved to outsourced manufacturing, moving our production to the
Philippines. This process involved extensive evaluation of manufacturing options, with
consideration given to their treatment of employees in line with our values, track records on
human rights, and sustainability of their operations.
Our chosen manufacturing partner, IMI Engineering, supports the Carbon Disclosure Project
(“CDP”) climate change initiative and submits annual CDP reports showing their continued
reduction in C02 emissions. In addition to this, since 2017 they have reduced their scrap levels
by 67% and are committed to effective engineering solutions that minimise their impact on
the environment.
REMANUFACTURING:
We closely follow the Ministry for the Environment’s recommended guidance for collection,
reuse and recycling of electrical and electronic equipment (EEE). We, therefore, remanufacture
EEE to the extent possible and with minimal waste, thereby offsetting what must be
extracted from the environment. We use reputable partners to recycle EEE that could not be
remanufactured, ensuring absolute integrity and efficiency of the recycling process.
Within the last financial year we began recycling electronic waste (since 4 April 2018). Since
then we have reclaimed:
• 287 kg of LiSOCl2 batteries
• 48 kg of PCB Boards
On average we now remanufacture/refurbish 1500 units per month using recycled
components. Where possible we re-use/re-cycle our cartons, especially our outers, both in our
production facility, and at our sales locations.
REDUCED USE OF FOSSIL FUELS
Less fossil fuels used, less CO2 into our environment. We have improved our supply chain to
reduce our reliance on international freight. According to the U.S. Environmental Protection
Agency, more than half of the air pollution in the USA comes from vehicles. Our products and
services enable our customers to move their vehicles more efficiently, which is why they use
less fuel after installing EHUBO2 in their vehicles.
ABOUT EROADABOUT EROAD

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20194544
Heather Woodruff
Customer Success & Service Manager
ABOUT EROADABOUT EROAD

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20194746
Male 61%
Female 39%
31%
Female
EROAD’s
wider
leadership
team
Technology
Sector
EROAD
23%
39%
7%
37%
26%
30%
Under 2526-35
36-45
Over 46
To deliver on our 3-5 year strategy plan we have designed a scalable organisation with the
right skill-sets to grow and mature the company in new markets and geographies. We have
bolstered our leadership team with new executive level members and key appointments to
deepen marketing, sales, finance, product and R&D capability, as well as establish leadership
teams for each country. We are investing heavily to develop future leaders across the business
to ensure excellent bench strength for our future growth.
We love what we do – delivering
our customers and community safer
roads, better environmental outcomes
and commercial advantage.
All figures are employees (no contractors included)
GENDER SPLIT
WOMEN AS A PERCENTAGE OF THE WORKFORCE
AGE SPLIT
ABOUT EROADABOUT EROAD
Sarah Thompson
VP Product

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20194948
We have over
250 staff
located across
our three markets.
New Zealand
US
Australia
197
57
5
EROADer
Location
35
EROADers come
from more than
c
o
u
n
t
r
i
e
s

a
r
o
u
n
d

t
h
e

w
o
r
l
d
91
new employees
joined us in FY19
All figures are employees
(no contractors included)
Ken Eyre
Senior Manager – Product Support & Fulfillment
ABOUT EROADABOUT EROAD

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20195150
Jyothi Madanlal
Software Engineer
SUPPORTIVE CULTURE
We maintain a supportive culture through company events, the social
committee, reward and recognition programmes and family-friendly
company policies such as flexible working and parental leave.
• Our employee engagement survey shows
that 84% of staff are proud to work for
EROAD and would recommend it as a great
place to work.
• Our culture is orientated around inclusion,
underpinned by a formal D&I strategy
and a high emphasis on our values.
Wellbeing is a positive and daily focus.
2/3 of employees are engaged in a three
month walkathon; we’re operating global
“Lean-in” development circles; frequent
walking meetings; an active volunteering
and social calendar and an employee driven
recognition program.
• Our teams enjoy flexible working, personal
choice technology and fruit and social
activities in the office.
• We provide our people with opportunities
to volunteer in the community and make a
real difference to those in need.
• A major refurbishment of our global and
ANZ headquarters was completed in March
2019. This has created a modern working
environment that supports agile working.
Habitat for
Humanity (2 days)
Truckers
Against Tracking
Oregon Food
Bank (2 days)
North America
We have volunteered
and supported
Gardening Therapy
Eat My Lunch
Shore and Dive Cleanup
Auckland City Mission (2x)
Pink Shirt Day
Gumboot Friday
I am hope
New Zealand
Building houses with Habitat for Humanity
Portland, Oregon, USA
Shore and Dive Cleanup
Auckland, New Zealand
ABOUT EROADABOUT EROAD

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20195352
EROAD GLOBAL HEAD OFFICE
AND ANZ HEADQUARTERS
Auckland, New Zealand
A major refurbishment of our global headquarters located in Albany,
Auckland, to ensure a modern space that supports a range of flexible working
styles, enhances collaboration and allows EROADers to work their magic.
ABOUT EROADABOUT EROAD

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20195554
LEARNING AND LEADERSHIP
We run programmes that encourage lifelong
learning, identify and develop our next
generation of leaders, and ensure that experts
in their fields share their knowledge with
others.
• Our approach to work is designed to foster
our entrepreneurial spirit. We celebrate
innovation with both a formal program
as well as the ability for employees to
recognize each other with awards.
• We use technology to enable cross
market collaboration, linking our teams in
borderless working.
GRADUATE PROGRAMMES
We recognise that the company’s future rests
with the next generation of engineers, product
owners and other talented professionals. We
help prepare young people to pursue these
disciplines by offering graduate programmes
and internships, realising two Graduates and
five Interns during FY19.
Soumya Puri
Project Manager
ABOUT EROADABOUT EROAD

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20195756
AUDITOR’SREPORT
AUDITOR’S REPORTAUDITOR’S REPORT



© 2019 KPMG, a New Zealand partnership and a member firm of the KPMG network of independent member
firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.

Independent Auditor’s
Report
To the shareholders of EROAD Limited
Report on the consolidated financial statements
Opinion
In our opinion, the accompanying consolidated financial
statements of EROAD Limited (the company) and its
subsidiaries (the Group) on pages 63 to 104:
i. present fairly in all material respects the Group’s
financial position as at 31 March 2019 and its
financial performance and cash flows for the year
ended on that date; and
ii. comply with New Zealand Equivalents to
International Financial Reporting Standards
We have audited the accompanying consolidated
financial statements which comprise:
— the consolidated statement of financial position as
at 31 March 2019;
— the consolidated statement of comprehensive
income, changes in equity and cash flows for the
year then ended; and
— notes, including a summary of significant
accounting policies and other explanatory
information.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (‘ISAs (NZ)’). We believe
that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We are independent of the Group in accordance with Professional and Ethical Standard 1 (Revised) Code of Ethics for
Assurance Practitioners issued by the New Zealand Auditing and Assurance Standards Board and the International Ethics
Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code), and we have fulfilled our other
ethical responsibilities in accordance with these requirements and the IESBA Code.
Our responsibilities under ISAs (NZ) are further described in the auditor’s responsibilities for the audit of the Group
financial statements section of our report.
Our firm has also provided other services to the Group in relation to tax compliance, tax advisory and corporate finance.
Subject to certain restrictions, partners and employees of our firm may also deal with the Group on normal terms within
the ordinary course of trading activities of the business of the Group. These matters have not impaired our independence
as auditor of the Group. The firm has no other relationship with, or interest in, the Group.
Scoping
The scope of our audit is designed to ensure that we perform adequate work to be able to give an opinion on the Group
financial statements as a whole, taking into account the structure of the Group, the financial reporting systems, processes
and controls, and the industry in which it operates.

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20195958







The context for our audit is set by the Group’s major activities in the financial year ended 31 March 2019. The Group’s
finance function is located at the head office in Auckland and in the USA office in Oregon. All audit work in respect of the
consolidated financial statements was performed by the Group engagement team.
Materiality
The scope of our audit was influenced by our application of materiality. Materiality helped us to determine the nature,
timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually and on the Group
financial statements as a whole. The materiality for the Group financial statements as a whole was set at $580,000
determined with reference to a benchmark of Group revenue. We chose the benchmark because, in our view, this is a key
measure of the Group’s performance.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
Group
’s consolidated financial statements in the current period. We summarise below those matters and our key audit
procedures to address those matters in order that the shareholders as a body may better understand the process by which
we arrived at our audit opinion. Our procedures were undertaken in the context of and solely for the purpose of our
statutory audit opinion on the Group financial statements as a whole and we do not express discrete opinions on separate
elements of the Group financial statements.
The key audit matter How the matter was addressed in our audit
Revenue Recognition ($61.3m)
Refer to Note 3 of the consolidated
financial statements.
The majority of the Group’s contracts
are accounted for as a service contract
under NZ IFRS 15.
We focused on this area because the
accounting determination of whether or
not the contract contains a lease has a
significant impact on the recognition of
profit and loss and balance sheet.
The contracts do not meet the definition
of a lease under NZ IFRS 16. These
customer contracts are deemed not to
represent a lease of the eHUBO unit
because EROAD’s customers do not
have the right to direct the use of the
asset and therefore do not have the
right to control the use of the eHUBO
unit. This is a significant judgement
under NZ IFRS 16.
We assessed the judgement in revenue recognition by:
— Assessing the Group’s revenue recognition policy for compliance with the
relevant accounting requirements;
— Selecting a sample of contracts during the year and agreeing the sample
to the contract terms and assessing the contractual terms against the NZ
IFRS 15 & 16 recognition requirements;
— Reviewing any changes or new contractual terms and conditions entered
into with new customers during the period, and consideration of the
potential impact on revenue recognition applied;
— Checking a sample of customer invoices immediately prior to and after
year end to confirm the service start date of the contract is line with the
NZ IFRS 15 & 16 requirements and;
— Challenging management’s conclusions that the customer contracts do
not meet the definition of a lease under NZ IFRS 16 and are therefore,
accounted for as a service contract under NZ IFRS 15 and NZ IFRS 16.
We did not identify any matters that indicated that the reported revenue is
materially misstated.

Development asset capitalisation and impairment ($29.8m)







The key audit matter How the matter was addressed in our audit
Refer to note 16 of the consolidated
financial statements.
The Group has reported a development
asset of $29.8m (2018: $26.8m). This
investment requires significant
judgement as to whether the largely
internal costs should be expensed or
capitalised, and assessing the indicators
of impairment. We focused on this area
due to the quantum of the development
costs capitalised.
The Group’s process for calculating the
amount of internally developed
platform costs to be capitalised is
judgmental and involves estimating the
hours which staff spend developing
software and determining the costs
attributable to that time.
The Directors have assessed whether
any impairment indicators existed for
each major development asset by
considering, among other factors, sales
achieved to date and the overall
operating and cash performance of the
entity.
Indicators of impairment were identified
in the US operations and the Group
performed an impairment test of the
development assets on a value in use
basis. This assessment requires
judgment when forecasting future sales
and the related cash flows, including
considering the difficulties in achieving
current year budgeted sales levels for
US market.
We assessed the judgement related to the internal costs capitalised by:
— Understanding the nature and background of the activities that are
capitalised through inquiry of the key operational, financial, legal, and
engineering personnel;
— Challenging whether costs capitalised during the year comply with the
accounting requirements; and
— Assessing the reasonableness of the amount of internal costs capitalised
based on the hours which staff spend developing software plus
attributable costs.
We assessed management’s impairment testing of the development asset by
obtaining the supporting model and assessing the methodology and key
assumptions made including:
— Confirming our understanding of the US telematics industry and country
specific regulation obtained during our visit to the EROAD Oregon
operations through interviews held with relevant members of the US
management team.
— Reconfirming the external advice management has obtained in respect of
the market strategy to be adopted in the US through discussions with
management to confirm our understanding of the operation’s strategy.
— Using our corporate finance experts to challenge and assess the
appropriateness and mathematical accuracy of management’s
impairment models well as the reasonableness of key inputs such as
weighted average cost of capital and long term growth weights.
— Challenging management’s future cash flow forecasts. This included
comparing previous forecasts to actual results and other relevant
supporting documentation such as sales pipelines (to evidence the
feasibility of the forecasts and to assess the reliability of historical
forecasting).
— We challenged management’s forecasts by performing sensitivity analysis
over the forecasted sales volumes, discount rate, and expenses. This
enabled us to ascertain the extent of change in those assumptions
required to result in an impairment of the development assets.
We did not identify any factors that indicated that management’s overall
conclusions were not supportable.
Deferred Tax Asset ($7.5m)
Refer to note 10 of the consolidated
financial statements.
The Group has a net deferred tax asset
balance of $7.5m, of which $9.3m
relates to deferred tax assets arising
from past tax losses. We focused on the
deferred tax asset from tax losses
Our procedures included the following:
— We evaluated the Group’s assessment of whether there would be sufficient
taxable profits in future periods to support the carrying value of the deferred
tax asset in New Zealand;
— We compared the assumptions used in the forecasts of taxable profit to
those applied in management’s FY19 budgets;
AUDITOR’S REPORTAUDITOR’S REPORT

EROAD ANNUAL REPORT 2019EROAD ANNUAL REPORT 20196160







The key audit matter How the matter was addressed in our audit
arising in New Zealand as its
recoverability is sensitive to the Group’s
expected future profitability and its
entitlement to offset these losses
against future profits.
This as a key risk due to the significance
of the deferred tax asset to the financial
position of the Group and the
judgement applied by management in
determining the extent to which a
deferred tax asset should be recognised.
— We challenged the key assumptions in the forecasts presented;
— We also considered whether the recognition of additional deferred tax
assets in relation to current year tax losses and previously unrecorded
losses were in compliance with the relevant accounting requirements;
— We examined correspondence with the Inland Revenue Department
supporting the calculation of available tax losses;
— We used our tax specialists to assess whether the shareholder continuity
requirements under New Zealand tax legislation had been maintained in
the current financial reporting period.
The results of our procedures did not identify any inconsistencies with
management’s conclusion that the recognition of unrecognised losses and
current year losses meets the criteria for recognition.

Other information
The Directors, on behalf of the Group, are responsible for the other information included in the entity’s Annual Report.
Other information includes the Chairman’s Report, Board of Directors, CEO’s Report, Executive Team, Financial Highlights,
About EROAD, Corporate Governance, Regulatory Disclosures, Other Information, Glossary and Key Dates and are included
in the Annual Report. Our opinion on the Group financial statements does not cover any other information and we do not
express any form of assurance conclusion thereon.
In connection with our audit of the Group financial statements our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the Group financial statements or our
knowledge obtained in the audit or otherwise appears materially misstated. If, based on the work we have performed, we
conclude that there is a material misstatement of this other information, we are required to report that fact. We have
nothing to report in this regard.
Use of this independent auditor’s report
This independent auditor’s report is made solely to the shareholders as a body. Our audit work has been undertaken so
that we might state to the shareholders those matters we are required to state to them in the independent auditor’s
report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to
anyone other than the shareholders as a body for our audit work, this independent auditor’s report, or any of the opinions
we have formed.
Responsibilities of the Directors for the consolidated financial statements
The Directors, on behalf of EROAD Limited, are responsible for:
— the preparation and fair presentation of the Group financial statements in accordance with generally accepted
accounting practice in New Zealand (being New Zealand Equivalents to International Financial Reporting Standards)
and International Financial Reporting Standards;







— implementing necessary internal control to enable the preparation of a Group set of financial statements that is fairly
presented and free from material misstatement, whether due to fraud or error; and
— assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless they either intend to liquidate or to cease operations,
or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the consolidated financial statements
Our objective is:
— to obtain reasonable assurance about whether the Group financial statements as a whole are free from material
misstatement, whether due to fraud or error; and
— to issue an independent auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs
NZ will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these Group financial
statements.
A further description of our responsibilities for the audit of these Group financial statements is located at the External
Reporting Board (XRB) website at:
http://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-report-1/
This description forms part of our independent auditor’s report.
The engagement partner on the audit resulting in this independent auditor's report is Ross Buckley
For and on behalf of


KPMG
Auckland
28 May 2019


AUDITOR’S REPORTAUDITOR’S REPORT

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
6263
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
STATEMENTSFINANCIAL
EROAD LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 March 2019
GROUP
31 March 201931 March 2018
Notes
$ $
Restated
Revenue361,351,89643,766,496
Operating Expenses4(45,718,717)(33,221,446)
Earnings before interest, taxation, depreciation and amortisation 15,633,17910,545,050
Depreciation of Property, Plant & Equipment14(6,621,272)(5,361,391)
Amortisation of Intangible Assets16(6,479,134)(5,594,391)
Amortisation of Contract and Customer Acquisition Assets(4,852,093)(3,673,129)
Earnings/(loss) before interest and taxation(2,319,320)(4,083,861)
Finance income828,88497,694
Finance expense8(2,815,983)(1,896,889)
Net financing costs(2,787,099)(1,799,195)
Profit/(loss) before tax (5,106,419)(5,883,056)
Income tax (expense)/benefit9191,1992,426,232
Profit/(loss) from continuing operations(4,915,220)(3,456,824)
Profit/(loss) after tax for the year attributable to the shareholders(4,915,220)(3,456,824)
Items that are or may be reclassified subsequently to profit or loss
Other comprehensive income(1,120,303)(196,793)
Total comprehensive income/(loss) for the year(6,035,523)(3,653,617)
Earnings per share - Basic (cents)11(7.31)(5.61)
Earnings per share - Diluted (cents)11(7.24)(5.57)
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
6465
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
EROAD LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2019
GROUP
31 March 201931 March 20181 April 2017
Notes
$ $
Restated
$
Restated
CURRENT ASSETS
Cash and cash equivalents1216,138,80621,870,415935,359
Restricted bank accounts12,672,7419,498,0719,208,289
Trade and other receivables1310,502,12311,626,4195,519,533
Contract fulfilment costs72,424,6262,140,1351,482,115
Costs to obtain contracts72,163,8881,448,655927,327
Current tax receivable5,30121,456361,912
Total Current Assets43,907,48546,605,15118,434,535
NON-CURRENT ASSETS
Property, plant and equipment1433,901,28923,848,22717,938,605
Intangible assets1633,132,28529,901,46928,662,777
Contract fulfilment costs72,662,9432,204,4722,108,773
Costs to obtain contracts72,100,0791,635,487935,665
Deferred tax assets107,495,4966,953,3854,367,515
Total Non-Current Assets79,292,09264,543,04054,013,335
TOTAL ASSETS123,199,577111,148,19172,447,870
CURRENT LIABILITIES
Overdrafts12--873
Borrowings1817,162,66710,574,689-
Trade payables and accruals176,111,4304,859,1245,251,971
Payables to NZTA and ODOT12,488,8719,439,1399,243,383
Current tax payable-85,245-
Contract liabilities195 , 7 57, 9 5 15,434,8814,569,936
Lease liabilities15782,450801,024727,406
Employee entitlements1,338,0261,147,4621,201,002
Total Current Liabilities43,641,39532,341,56420,994,571
NON-CURRENT LIABILITIES
Borrowings
1817,476,02915,908,6707,029,304
Contract liabilities
194,209,4724,739,0713,498,971
Lease liabilities
156,246,8591,264,6902,093,192
Deferred tax liabilities10335,025127,3833,409
Total Non-Current Liabilities
28,267,38522,039,81412,624,876
TOTAL LIABILITIES71,908,78054,381,37833,619,447
NET ASSETS51,290,79756,766,81338,828,423
EQUITY
Share capital1180,612,42380,326,43858,965,367
Translation reserve(1,654,943)(534,640)(337,847)
Retained earnings(27,666,683)(23,024,985)(19,799,097)
TOTAL SHAREHOLDERS' EQUITY51,290,79756,766,81338,828,423
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
EROAD LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 March 2019
GROUP
Share Capital Retained Earnings
Translation
Reserve
Total
Notes$$$$
Balance as at 1 April 2017 as originally presented 58,965,367 (13,066,244) (343,389)45,555,734
Adjustment on initial application of NZ IFRS 15,16 & 9
(net of tax)
2 (6,732,853) 5,542 (6,727,311)
Balance as at 1 April 2017 (restated) 58,965,367 (19,799,097) (337,847) 38,828,423
Profit after tax for the year (restated) - (3,456,824)(3,456,824)
Other comprehensive income - - (196,793)(196,793)
Total comprehensive loss for the year, net of tax - (3,456,824) (196,793) (3,653,617)
Equity settled share-based payments 37,818 230,936 - 268,754
Share capital issued11 21,323,253 21,323,253
Balance at 31 March 2018 80,326,438 (23,024,985) (534,640) 56,766,813
Balance as at 31 March 2018 as originally presented 80,326,438 (12,625,692) (540,182) 67,160,564
Adjustment on initial application of NZ IFRS 15,16 & 9
(net of tax)
- (10,399,293) 5,542 (10,393,751)
Balance as at 1 April 2018 (restated) 80,326,438 (23,024,985) (534,640) 56,766,813
Profit after tax for the year
-
(4,915,220)
-
(4,915,220)
Other comprehensive income - - (1,120,303)(1,120,303)
Total comprehesive loss for year - net of tax - (4,915,220) (1,120,303) (6,035,523)
Equity settled share-based payments 94,424 273,522 - 367,946
Share capital issued11 191,561 191,561
Balance at 31 March 2019 80,612,423 (27,666,683) (1,654,943) 51,290,797
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.

CONSOLIDATED STATEMENT OF FINANCIAL POSITIONCONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Chair of the Finance, Risk and Audit Committee, 28 May 2019Chairman, 28 May 2019

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
6667
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
EROAD LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 March 2019
GROUP
31 March 201931 March 2018
Notes

$

$
Restated
Cash flows from operating activities
Cash received from customers62,269,663 39,810,030
Payments to suppliers and employees(45,356,635) (33,061,706)
Interest received 19,645 13,453
Interest paid (2,815,983) (1,896,889)
Tax received 196,536 340,456
Net cash inflow from operating activities14,313,226 5,205,344
Cash flows from investing activities
Payments for investment in property, plant & equipment14 (10,794,313) (11,315,559)
Payments for investment in intangible assets16 (9,709,950) (6,833,083)
Payments for investment in contract fulfilment assets (3,527,493) (3,000,865)
Payments for investment in customer acquisition assets (3,247,387) (2,647,133)
Net cash outflow from investing activities (27,279,143) (23,796,640)
Cash flows from financing activities
Receipts from bank loans18 23,602,236 23,731,244
Repayments of bank loans18 (15,446,899) (4,277,189)
Repayments of lease liability (921,029) (754,884)
Receipts from issue of equity11 - 21,501,711
Payments for costs of raising equity - (673,657)
Net cash inflow from financing activities 7,234,308 39,527,225
Net increase/(decrease) in cash held (5,731,609) 20,935,929
Cash at beginning of the financial year21,870,415934,486
Closing cash and cash equivalents (net of overdrafts)16,138,80621,870,415
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
EROAD LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2019
NOTE 1 • SUMMARY OF SIGNIFICANT GROUP ACCOUNTING POLICIES
EROAD Limited (the “Parent”) is a company domiciled in New Zealand registered under the Companies Act 1993 and listed on
the New Zealand Stock Exchange (NZX) Main Board. The Company is an FMC reporting entity for the purposes of the Financial
Markets Conduct Act 2013 and the financial statements have been prepared in accordance with the requirements of that Act and
the Financial Reporting Act 2013. The consolidated financial statements comprise EROAD Limited and its subsidiaries (the “Group”).
The Group provides electronic on-board units and software as a service to the transport industry.
The financial statements for the Group are for the year ended 31 March 2019
The financial statements were authorised for issue by the directors on 28 May 2019.
The accounting policies below have been applied consistently to all periods presented in these financial statements.
(a) Basis of preparation
Statement of compliance with IFRS
The consolidated financial statements comprise the following: consolidated statement of comprehensive income, consolidated
statement of changes in equity, consolidated statement of financial position, consolidated statement of cash flows, and accounting
policies and notes to the financial statements contained on pages 62 to 104.
The consolidated financial statements have been prepared in accordance with New Zealand Generally Accepted Accounting
Practice (“NZ GAAP”). They comply with the New Zealand equivalents to International Financial Reporting Standards (NZ IFRS)
and other applicable Financial Reporting Standards as appropriate to Tier 1 for-profit entities.
Comparative figures
Where a change in presentation of the financial statements has been made during the period, comparative statements and notes
have been restated to align with current year presentation.
Basis of measurement
The financial statements are prepared on the historical cost basis. Except for certain financial instruments carried at fair value as
described in (g) and (h).
Going concern
The financial statements have been prepared using the going concern assumption.
Presentation currency
The financial statements are presented in New Zealand dollars and all values are rounded to the nearest dollar ($).The functional
currency of EROAD Limited is New Zealand Dollars (NZD).
Use of estimates and judgements
In preparing these consolidated financial statements in conformity with NZ IFRS, management has made judgements, estimates
and assumptions that affect the application of the Group’s accounting policies and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an
ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future
periods affected.
Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment within
the next financial period are included in the following notes:
Note 3: The Group provides a right to use its hardware assets as part of its contracts with customers. Determining whether the
contract contains a lease as per the definition of NZ IFRS 16, is a significant judgement requiring consideration as to whether the
customer has the right to direct the use of the hardware asset. Historically the company assessed EROAD’s customers as having
physical control of the EROAD unit and therefore a right to use an asset. Under NZ IFRS 16 the company has determined that
EROAD’s customers don’t have the right to direct the use of EROAD’s asset because EROAD continues to have the right and ability
to change how the unit operates during the customer’s contractual term. The Group determined that customers do not have the
right to control the use of its hardware assets and therefore the arrangement does not contain a lease. Therefore the contracts have
been accounted for as a services contract under NZ IFRS 15.

NOTES TO THE FINANCIAL STATEMENTSCONSOLIDATED STATEMENT OF CASH FLOWS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
6869
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
The contracts with customers include promises to provide multiple products and services. Determining whether the products
and services are considered distinct performance obligations that should be accounted for separately versus together requires
significant judgement. The Group provides significant integration services of its hardware assets and installation services when
integrating its software and therefore has accounted for these services as one performance obligation.
Note 10: recognition of deferred tax assets: availability of future taxable profit against which carry forward tax losses can be used.
Note 16: impairment testing for intangible assets, key assumptions underlying recoverable amounts, including the recoverability of
development costs.
(b) Basis of Consolidation
The Group financial statements consolidate the financial statements of subsidiaries using the purchase method of accounting.
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed 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. The financial
statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the
date on which control ceases.
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions are eliminated.
(c) Business Combinations
The Group accounts for business combinations using the purchase method when control is transferred to the Group. The
consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any
goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognised in profit or loss immediately.
Transaction costs are expensed as incurred, except if related to the issue of debt or equity securities.
The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are
generally recognised in the statement of comprehensive income. Any contingent consideration is measured at fair value at the date
of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as
equity, then it is not remeasured and settlement is accounted for within equity. Otherwise, subsequent changes in the fair value of
contingent consideration are recognised in equity.
(d) Revenue
Software as a service revenue
The Group generates revenue through the sale of hardware assets, rental of hardware assets, installation of hardware assets and
provision of software services as part of contracts with customers as part of a bundled package. These hardware units enable
customers to access the software platform offered by the Group. The transaction involving hardware and accessories do not
convey a distinct good or service. The sale does not transfer control to the customer as the Group provides a significant service
of integrating the software service to produce a combined output. The sale of the hardware, accessories and software service are
referred to as Software as a Service (SaaS) revenue, which is recognised over time as the customer simultaneously receives and
consumes the benefits of the service. The Group concluded that the customer is expected to benefit from the services evenly over
the period of delivery being the contract period and as a result would recognise revenue on a straight line basis of the contract
period. The Group recognises revenue from the date of installation as this is when the Group deems the service period to begin.
There are no variable consideration terms within the contracts.
The timing of revenue recognition may differ from the timing of invoicing to customers and the receipt of consideration. A contract
liability is recognised where consideration is received in advance of the completion of associated performance obligations. The
contract liability derecognised over time evenly over the period of the contract as the customer derives the benefit evenly from the
services provided over the contract period. The majority of contracts are for 3 years and can be for a term of up to 5 years. As a
result there is a financing component which the group recognise as a finance cost when consideration is received in advance.
The Group offers installation services as part of a number of promises to transfer goods and services within each contract.
Installation services do not convey a distinct good or service and therefore are not a separate performance obligation as the
installation is a set-up activity that does not provide the customer a direct benefit other than access to the software services. As a
result, the installation service is considered as part of the single performance obligation; referred to as Software as a Service (SaaS)
revenue, which includes the software service and hardware sale or rental for which the customer simultaneously receives and
consumes the benefit of the service. Where installation revenue is received in advance of satisfying the performance obligation a
contract liability is recognised. The contract liability derecognised over time evenly over the period of the contract as the customer
derives the benefit evenly from the services provided over the contract period.
The majority of contracts are for 3 years and can be for a term of up to 5. As a result there is a financing component which the
group recognise as a finance cost when consideration is received in advance.
Transaction fees
When the Group acts in the capacity of an agent rather than as the principal in a transaction, the revenue recognised is the net
amount of commission made by the Group.
Capitalised contract fulfillment costs
The Group capitalises incremental costs of fulfilling customer contracts, typically distribution and installation costs. Contract
fulfillment costs are amortised evenly over the period of the contract. The majority of contracts are for 3 years and can be for a term
of up to 5 years.
Capitalised contract acquisition costs
The Group has applied a policy of capitalising only costs that are incremental in obtaining contracts with customers, typically sales
commissions. Contract acquisition costs are amortised evenly over the period of the contract. The majority of contracts are for 3
years and can be for a term of up to 5 years.
(e) Finance income and finance expenses
The Group’s finance income and finance expenses include: interest payable and receivable recognised using the effective interest
rate method, foreign exchange gains and losses.
(f) Taxation
Income tax expense comprises current and deferred tax. Current tax and deferred tax is recognised in profit or loss except to the
extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the period, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous periods. Current tax payable
also includes any tax liability arising from the declaration of dividends.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax rates that are expected to be
applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the
reporting date.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent that it is
probable that future taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed at each
reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
(g) Financial Instruments
Recognition and initial measurement
Trade receivables and debt securities issued are initially recognised when they are originated. All other financial assets and financial
liabilities are initially recognised when the Group becomes a party to the contractual provisions of the instrument.
A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially measured
at fair value plus, for an item not at Fair Value through Profit or Loss, transaction costs that are directly attributable to its acquisition
or issue. A trade receivable without a significant financing component is initially measured at the transaction price.
Classification and subsequent measurement
Financial assets – Policy applicable from 1 April 2018:
On initial recognition, a financial asset is classified as measured at: amortised cost; Fair Value through Other Comprehensive Income
– equity investment; or Fair Value through Profit or Loss.
Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business model for
managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period
following the change in the business model.
NOTE 1 • SUMMARY OF SIGNIFICANT GROUP ACCOUNTING POLICIES (CONTINUED)NOTE 1 • SUMMARY OF SIGNIFICANT GROUP ACCOUNTING POLICIES (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
7071
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
Amortised Cost
A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at Fair Value
through Profit or Loss:
- it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
- its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal
amount outstanding.
Equity Investment - Fair Value Through Other Comprehensive Income
On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present subsequent
changes in the investment’s fair value in Other Comprehensive Income. This election is made on an investment-by-investment basis.
Fair Value through Profit or Loss
All financial assets not classified as measured at amortised cost or Fair Value through Other Comprehensive Income as described
above are measured at Fair Value through Profit or Loss. This includes all derivative financial assets. On initial recognition, the Group
may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortised cost or at Fair
Value through Other Comprehensive Income as at Fair Value through Profit or Loss if doing so eliminates or significantly reduces an
accounting mismatch that would otherwise arise.
Financial assets – Subsequent measurement and gains and losses:
Financial assets at Fair Value through Profit or Loss
These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are
recognised in profit or loss
Financial assets at amortised cost
These assets are subsequently measured at amortised cost using the effective interest method. The amortised cost is reduced by
impairment losses. Interest income, foreign exchange gains and losses and impairment are recognised in profit or loss. Any gain or
loss on derecognition is recognised in profit or loss.
Equity investments at Fair Value through Other Comprehensive Income
These assets are subsequently measured at fair value. Dividends are recognised as income in profit or loss unless the dividend
clearly represents a recovery of part of the cost of the investment. Other net gains and losses are recognised in Other
Comprehensive Income and are never reclassified to profit or loss.
Financial liabilities - Classification, subsequent measurement and gains and losses
Financial liabilities are classified as measured at amortised cost or Fair Value through Profit or Loss. A financial liability is classified
as at Fair Value through Profit or Loss if it is classified as held-for-trading, it is a derivative or it is designated as such on initial
recognition. Financial liabilities at Fair Value through Profit or Loss are measured at fair value and net gains and losses, including any
interest expense, are recognised in profit or loss. Other financial liabilities are subsequently measured at amortised cost using the
effective interest method. Interest expense and foreign exchange gains and losses are recognised in profit or loss. Any gain or loss
on derecognition is also recognised in profit or loss.
Financial Assets - Policy applicable before 1 April 2018
The Group classifies non-derivative financial assets and liabilities into the following categories: loans and receivables and other
financial liabilities.
Loans and receivables
Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an active market. Such assets
are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, loans and
receivables are measured at amortised cost using the effective interest method, less any impairment losses.
Loans and receivables comprise cash and cash equivalents, trade and other receivables and loans to shareholders and directors.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with original maturities of three months or less.

(h) Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure
purposes.
The fair values of financial instruments that are not traded in an active market are determined using valuation techniques. The
Group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance date. Other
techniques, such as estimated discounted cash flows, are used to determine fair value for the remaining financial instruments.
The fair value of forward exchange contracts is determined using forward exchange market rates at the balance sheet date. Fair
values reflect the credit risk of the financial instrument and include adjustments to take account of the credit risk of the Group and
counterparty when appropriate.
The carrying value less impairment provision of trade receivables is assumed to approximate its fair value due to its short term
nature. The fair value of non-current financial liabilities for disclosure purposes is estimated by discounting the future contractual
cash flows at the current market interest rate that is available to the Group for similar financial instruments.
(i) Property, Plant and Equipment
Items of plant and equipment are stated at cost, less accumulated depreciation and impairment losses. Cost includes the purchase
consideration, and those costs directly attributable to bringing the asset to the location and condition necessary for its intended
use. Where an item of plant and equipment is disposed of, the gain or loss recognised in the statement of comprehensive income
is calculated as the difference between the net sales price and the carrying amount of the asset.
Subsequent costs
The Group recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such an
item when that cost is incurred if it is probable that the future economic benefits embodied within the item will flow to the Group
and the cost of the item can be measured reliably. All other costs are recognised in the statement of comprehensive income as an
expense in the period they are incurred.
Depreciation
Depreciation begins when the asset is in the location and condition necessary for it to be capable of operating in the manner
intended by management. The following rates have been used:
Leasehold improvements3 to 9 yearsStraight line
Hardware assets3 to 6 yearsStraight line
Plant and equipment3 to 11 yearsStraight line
Computer/Office equipment1 to 3 yearsStraight line
Motor vehicles3 to 5 yearsStraight line
The above rates reflect the estimated useful lives of the respected categories. Leasehold improvements are depreciated over the
contracted lease term.
(j) Leases as a lessee
The Group recognises a right-of-use asset and a lease liability at the commencement date. The right-of-use asset is initially
measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the
commencement date, plus any initial direct costs incurred and an estimate of costs to restore the underlying asset or the site on
which it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of
the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are
determined on the same basis as those of property, plant and equipment. In addition, the right-of-use asset is periodically reduced
by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date,
discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental
borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate.
NOTE 1 • SUMMARY OF SIGNIFICANT GROUP ACCOUNTING POLICIES (CONTINUED)NOTE 1 • SUMMARY OF SIGNIFICANT GROUP ACCOUNTING POLICIES (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
7273
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
Lease payments included in the measurement of the lease liability comprise the following:
• fixed payments, including in-substance fixed payments;
• variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the
commencement date;
• amounts expected to be payable under a residual guarantee; and
• the exercise priced under a purchase option that the Group is reasonably certain to exercise, lease payments in an optional
renewal period if the Group is reasonably certain to exercise an extension option, and penalties for early termination of a
lease unless the Group is reasonably certain not to terminate early.
The lease liability is measured at amortised cost using the effective interest rate method. It is remeasured when there is a change
in future lease payments arising from a change in an index or rate, if there is a change in the Group’s estimate of the amount
expected to be payable under a residual value guarantee, or if the Group changes its assessment of whether it will exercise a
purchase, extension or termination option.
When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-
use asset or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
The Group presents right-of-use assets in ‘Property, plant and equipment’. Lease liabilities are presented separately in the
Statement of Financial Position.
Short-term leases and leases of low-value items
The Group has elected not to recognise right-of-use assets and lease liabilities for short-term property leases and leases of low-
value assets including office equipment. The Group recognises the lease payments associated with these leases as an expense
on a straight-line basis over the lease term.
(k) Intangible assets
Research and Development
Expenditure on research activities, undertaken with the prospect of gaining new technical knowledge and understanding, is
recognised in the statement of comprehensive income when incurred.
Development activities involve a plan or design for the production of new or substantially improved products and processes.
Development expenditure is capitalised only if development costs can be measured reliably, the product or process is technically
and commercially feasible, future economic benefits are probable, and the Group intends to and has sufficient resources to
complete development and to use or sell the asset. The expenditure capitalised includes the cost of materials, direct labour
and overhead costs that are directly attributable to preparing the asset for its intended use. Other development expenditure is
recognised in the statement of comprehensive income when incurred.
Capitalised development expenditure is measured at cost less accumulated amortisation and accumulated impairment losses.
Other intangible assets
Other intangibles assets that are acquired by the Group, which have finite useful lives, are measured at cost less accumulated
amortisation and accumulated impairment losses.
Subsequent expenditure
Subsequent expenditure is only capitalised only when it increases the future economic benefits embodied in the specific asset
to which is relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in the
statement of coprehensive income when incurred.
Amortisation
Amortisation is recognised in the statement of comprehensive income on a straight line basis over the estimated useful life of
intangible asset. The estimated useful lives for the current and comparative periods are as follows:
Patents10–20 years
Development Hardware & Platform7–15 years
Development Products5–10 years
Software5–7 years
(l) Inventories
Inventories are valued at the lower of cost or net realisable value. Costs are based on actual costs, applying the first in first out
principle, and include expenditure incurred in acquiring the inventories and bringing them to the existing condition and location. In
the case of manufactured inventories, cost includes direct materials and labour.
(m) Foreign Currencies
Transactions in foreign currencies are translated into the respective functional currencies of Group companies at the exchange rates
at the dates of the transactions.
Monetary assets and liabilities denominated in foreign currencies are translated into functional currency at the exchange rate at
the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the
functional currency at the exchange rate when the fair value was determined. Foreign currency differences are generally recognised
in the statement of comprehensive income. Non-monetary items that are measured based on historical cost in a foreign currency
are not translated. Foreign currency gains and losses are reported on a net basis as either finance income or finance expenses.
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated
into NZD at the exchange rates at the reporting date. The income and expenses of foreign operations are translated into NZD at the
exchange rates at the dates of the transactions. Foreign currency differences are recognised in Other Comprehensive Income and
accumulated in the translation reserve.
(n) Goods and Services Tax
All amounts are shown exclusive of Goods and Services Tax (GST), except for receivables and payables that are stated inclusive of
G ST.
(o) Employee benefits
Short-term employee benefits
Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to
be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the
employee and the obligation can be estimated reliably.
Shared-based payments
The grant-date fair value of equity-settled share-based payment awards to employees is generally recognised as an expense,
with a corresponding increase in equity, over the vesting period of the awards. The amounts recognised as an expense is adjusted
to reflect the number of awards for which the related service and non-market conditions are expected to be met, such that the
amount ultimately recognised 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 is measured to reflect such conditions and there is no true-up for differences between the expected and actual
outcomes.
(p) Impairment of assets
The carrying amounts of the Group’s assets other than inventories are reviewed at each balance date to determine whether there is
any objective evidence of impairment. If any such indication exists, the assets recoverable amount is estimated.
If the estimated recoverable amount of an asset is less than its carrying amount, an impairment test is undertaken to reduce
the carrying amount of assets to the estimated recoverable amount and an impairment loss is recognised in the statement of
comprehensive income.
Estimated recoverable amount of receivables carried at amortised cost are calculated as the present value of estimated future cash
flows, discounted at their original effective interest rate. Receivables with a short duration are not discounted.
Estimated recoverable amount of other assets is the greater of their fair value less costs to sell and value in use. Value in use is
determined by estimating future cash flows from the use and ultimate disposal of the asset and discounting these to their present
value using a pre-tax discount rate that reflects current market rates and the risks specific to the asset. For an asset that does not
generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset
belongs.
NOTE 1 • SUMMARY OF SIGNIFICANT GROUP ACCOUNTING POLICIES (CONTINUED)NOTE 1 • SUMMARY OF SIGNIFICANT GROUP ACCOUNTING POLICIES (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
7475
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
(q) Borrowing costs
Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised as
part of the cost of that asset. Other borrowing costs are recognised as an expense in the period in which they are incurred.
(r) Grant income
Government grants are recognised at fair value in the statement of comprehensive income over the same periods as the costs for
which the grants are intended to compensate.
(s) Segment reporting
Segment results that are reported to the CEO include items directly attributable to a segment as well as those that can be allocated
on a reasonable basis. Unallocated items comprise income tax .
(t) Standards issued but not yet adopted
A number of new standards, amendments to standards and interpretations are effective for annual periods beginning on or after a
1 April 2019, and have not been applied as they are not expected to have a significant impact on the Group’s consolidated financial
statements.
NOTE 2 • IMPACT OF INITIAL APPLICATION OF NEW NZ IFRS
This note discloses the new accounting policies that have been applied from 1 April 2017, where they have changed from those
applied in prior periods. The Group has adopted NZ IFRS 15 Revenue from Contracts with Customers, NZ IFRS 16 Leases and NZ
IFRS 9 Financial Instruments, with application from 1 April 2017. This note explains the impact of the adoption of NZ IFRS 15, NZ
IFRS 16 and NZ IFRS 9 on the Group’s financial statements.
In adopting the above new standards, the Group has applied the following:
A. NZ IFRS 15 – In the current year, the Group has applied NZ IFRS 15 from its effective date. The date of initial application of NZ
IFRS 15 for the Group is 1 April 2017. The group has applied NZ IFRS 15 using retrospective approach with practical expedients
and restatement of comparative information.
B. NZ IFRS 16 –In the current year, the Group has applied NZ IFRS 16 in advance of its effective date. The date of initial application
of NZ IFRS 16 for the Group is 1 April 2017. The group has applied NZ IFRS 16 using the full retrospective approach, with
restatement of comparative information.
C. NZ IFRS 9 – The Group has applied NZ IFRS 9 modified retrospectively, but has elected not to restate comparative information.
As a result, the comparative information provided continues to be accounted for in accordance with the Group’s previous
accounting policies.
The effect of initially applying these standards is mainly attributed to:
• Reversing previous sales and associated cost of sales of all contracts deemed “finance leases” under the old lease standard;
• Deferral of the recognition of revenue relating to eHubo hardware sales, installations and accessories;
• Expensing of costs capitalised for contract establishment costs under the old lease standard;
• Recognition of right to use assets and associated liabilities where EROAD is the lessee; and
• Minimal impact arising from application of the Group’s expected credit loss model.
The decision was made to early adopt NZ IFRS 16, as while under the existing Leases standard NZ IAS 17, many of EROAD’s
customer contracts met the definition of a lease and lease accounting as a lessor was applied, these same contracts do not meet
the definition of a lease under NZ IFRS 16 and would therefore be accounted for as service contracts under IFRS 15. Without
early adoption of IFRS 16 EROAD would effectively be restating revenue again for the year ended 31 March 2020 on adoption of
the new lease standard. The Board believes that in early adopting the new lease standard the potential confusion created around
EROAD’s revenues is eliminated and this method will provide more relevant and understandable information for the user of the
financial statements.
NOTE 2 • IMPACT OF INITIAL APPLICATION OF NEW NZ IFRS (CONTINUED)
(A) Revenue
Under NZ IFRS 16, a customer contract contains a lease based on whether the customer has the right to direct the use of an asset,
in this case being the EROAD eHubo or Tubo (the unit). This differs from the definition under NZ IAS 17 which defines a lease as an
agreement providing the customer the right to use an asset. Historically the company determined that EROAD’s customers had
physical control of the EROAD unit and therefore a right to use an asset and consequently a lease. Under NZ IFRS 16, the focus is on
the right to direct the use of the asset and the company has determined that EROAD’s customers do not have that right as EROAD
continues to have the right and ability to change how the unit operates during the customer’s contractual term. These contracts
therefore no longer meet the definition of a lease and are accounted for as service contracts under NZ IFRS 15.
NZ IFRS 15 replaces NZ IAS 18 Revenue and NZ IAS 11 Construction Contracts. The standard applies to all revenue arising from
contracts with customers unless those contracts are within the scope of another standard. The standard is based on a five-step
model to account for revenue arising from contracts with customers. Under NZ IFRS 15, revenue is recognised to depict the transfer
of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled
in exchange for those goods or services. The standard also specifies the accounting for incremental costs of obtaining a contract
with a customer and for the costs incurred to fulfil a contract with a customer if those cost are not within the scope of another
standard.
Application of the new lease definition represents a change in the way the company recognises revenue and costs relating to its
contracts with customers. The company no longer recognises revenues at the point of dispatch to the customer from contracts for
outright sales of an EROAD units, installation services, sale of accessories or entering finance leases. EROAD now recognises these
revenue streams over the contract term, typically 3 years. Other impacts from adopting the new accounting standards include a
reduction in the capitalisation of costs associated with establishing the customer contracts.
The following new revenue accounting policies have been adopted:
Software as a service revenue
The Group generates revenue through the sale of hardware assets, rental of hardware assets, installation of hardware assets and
provision of software services as part of contracts with customers as part of a bundled package. These hardware units enable
customers to access the software platform offered by the Group. The transaction involving hardware and accessories do not
convey a distinct good or service. The sale does not transfer control to the customer as the Group provides a significant service
of integrating the software service to produce a combined output. The sale of the hardware, accessories and software service are
referred to as Software as a Service (SaaS) revenue, which is recognised over time as the customer simultaneously receives and
consumes the benefits of the service. The Group concluded that the customer is expected to benefit from the services evenly over
the period of delivery being the contract period and as a result would recognise revenue on a straight line basis of the contract
period. The Group recognises revenue from the date of installation as this is when the Group deems the service period to begin.
There are no variable consideration terms within the contracts.
The timing of revenue recognition may differ from the timing of invoicing to customers and the receipt of consideration. A contract
liability is recognised where consideration is received in advance of the completion of associated performance obligations. The
contract liability derecognised over time evenly over the period of the contract as the customer derives the benefit evenly from the
services provided over the contract period. The majority of contracts are for 3 years and can be for a term of up to 5 years. As a
result there is a financing component which the group recognise as a finance cost when consideration is received in advance.
The Group offers installation services as part of a number of promises to transfer goods and services within each contract.
Installation services do not convey a distinct good or service and therefore are not a separate performance obligation as the
installation is a set-up activity that does not provide the customer a direct benefit other than access to the software services. As a
result, the installation service is considered as part of the single performance obligation; referred to as Software as a Service (SaaS)
revenue, which includes the software service and hardware sale or rental for which the customer simultaneously receives and
consumes the benefit of the service. Where installation revenue is received in advance of satisfying the performance obligation a
contract liability is recognised. The contract liability derecognised over time evenly over the period of the contract as the customer
derives the benefit evenly from the services provided over the contract period. The majority of contracts are for 3 years and can be
for a term of up to 5. As a result there is a financing component which the group recognise as a finance cost when consideration is
received in advance.
NOTE 1 • SUMMARY OF SIGNIFICANT GROUP ACCOUNTING POLICIES (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
7677
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
Capitalised contract fulfillment costs
The Group capitalises incremental costs of fulfilling customer contracts, typically distribution and installation costs. Contract
fulfillment costs are amortised evenly over the period of the contract. The majority of contracts are for 3 years and can be for a term
of up to 5 years.
Capitalised contract acquisition costs
The Group has applied a policy of capitalising only costs that are incremental in obtaining contracts with customers, typically sales
commissions. Contract acquisition costs are amortised evenly over the period of the contract. The majority of contracts are for 3
years and can be for a term of up to 5 years.
(B) Leases
The Group separates the components of a contract into the lease and non-lease component and classifies the lease component as a
lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
For all leases where EROAD is the lessee; except short-term leases and leases of low value assets (based on the nature of the asset
and its value), the Group:
a) recognises right-of-use assets and lease liabilities in the consolidated statement of financial position, initially measured at the
present value of future lease payments;
b) recognises depreciation of right-of-use assets and interest on lease liabilities in the consolidated statement of comprehensive
income; and
c) separates the total amount of cash paid into a principal portion (presented within financing activities) and interest (presented
within operating activities) in the consolidated statement of cash flows.
Lease incentives (e.g. free rent period) are recognised as part of the measurement of the right-of-use assets and lease liabilities
whereas under NZ IAS 17 they resulted in the recognition of a lease incentive liability, amortised as a reduction of rental expense on
a straight-line basis.
The right-of-use assets are tested for impairment in accordance with NZ IAS 36 Impairment of Assets. This replaces the previous
requirement to recognise a provision for onerous lease contracts on operating leases. For short term leases (lease term of 12 months
or less) and leases of low-value assets (such as personal computers and office furniture), the Group has opted to recognise a lease
expense on a straight-line basis as permitted by NZ IFRS 16.
(C) Financial Instruments
The Group classifies its financial assets as being measured at amortised cost. At initial recognition, the Group measures a financial
asset at its fair value plus transaction costs that are directly attributable to the acquisition of the financial asset.
The Group assesses on a forward-looking basis, the expected credit losses associated with its financial assets carried at amortised
cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. In assessing
whether there has been a significant increase in credit risk, the Group considers both forward looking and financial history of
counterparts to assess the probability of default or likelihood that full settlement is received.
For trade receivables, the Group applies the simplified approach permitted by NZ IFRS 9, which requires expected lifetime
credit losses to be recognised from initial recognition of the trade receivables. Trade receivables are written off when there is no
reasonable expectation of recovery. Indicators that there is no reasonable expectation of recovery include, amongst others, the
failure of a debtor to engage in a repayment plan with the Group, and a failure to make contractual payments for a period of greater
than 180 days past due. The expected credit loss allowances for financial assets are based on assumptions about risk of default and
expected credit loss rates. The Group uses judgement in making these assumptions and selecting the inputs to the impairment
calculation. This is based on the Group’s past history, existing market conditions as well as forward looking estimates at the end of
each reporting period.
Trade Receivables
The Group’s trade receivables are subject to NZ IFRS 9’s expected credit loss model. The Group has applied the NZ IFRS 9
simplified approach to measuring expected credit losses which uses a lifetime expected credit loss allowance for all trade
receivables. To measure expected credit losses, trade receivables have been grouped and reviewed on the basis of the number of
days past due. The expected credit loss allowance has been calculated by considering the impact of the following characteristics:
• The Baseline characteristic considers the age of each invoice and applies an increasing expected credit loss estimate as the
trade receivable ages.
• The Aging and Write offs characteristics consider the history of write off related to the specific customer and the relative
size of aged debt to current debt. If the trade receivable aged over 180 days makes up more than 50% of the total trade
receivable for a specific customer, further provision for expected credit loss is added.
• The Country, Customer and Market characteristics consider the relative risk related to the country and/or region within which
the customer resides and makes an assessment of the financial strength of the customer and the market position that the
Group has achieved within that market.
This note discloses the new accounting policies that have been applied from 1 April 2017, where they have changed from those
applied in prior periods. The Group has adopted NZ IFRS 15 Revenue from Contracts with Customers, NZ IFRS 16 Leases and NZ
IFRS 9 Financial Instruments, with application from 1 April 2017. This note explains the impact of the adoption of NZ IFRS 15, NZ
IFRS 16 and NZ IFRS 9 on the Group’s financial statements.
As a result of the changes in the entity’s accounting policies, prior year financial statements are restated to reflect these changes.
The adjustments from the adoption of NZ IFRS 15 and NZ IFRS 16 have been explained in Note 2(a) and Note 2(b) respectively. The
tables below detail the adjustments recognised for each individual line item.
STATEMENT OF CONDENSED
CONSOLIDATED COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2018
As originally
presented
NZ IFRS 15NZ IFRS 16Restated
$
2(a)(i)
$
2(a)(ii)
$
2(b)(i)
$
2(b)(ii)
$$
Continuing operations
Revenue51,523,757 (1,781,914) (975,500) (4,999,847) - 43,766,496
Expenses(36,513,784) 2,240,400 - 193,777 858,161 (33,221,446)
Earnings before interest, taxation, depreciation
and amortisation
15,009,973458,486(975,500)(4,806,070)858,16110,545,050
Depreciation of Property, Plant & Equipment(9,945,960) (790,949) - 6,027,732 (652,214)(5,361,391)
Amortisation of Intangible Assets(5,594,391) - - - - (5,594,391)
Amortisation of Contract and Customer
Acquisition Assets
- - - (3,673,129) - (3,673,129)
Earnings before interest and taxation(530,378)(332,463)(975,500)(2,451,467)205,947(4,083,861)
Finance income245,616 - - (147,922) - 97,694
Finance expense(1,259,442) (99,360) (171,260) (219,050) (147,777)(1,896,889)
Net financing costs(1,013,826)(99,360)(171,260)(366,972)(147,777)(1,799,195)
Profit/(loss) before tax (1,544,204)(431,823)(1,146,760)(2,818,439)58,170(5,883,056)
Income tax (expense)/benefit1,753,820 135,282 318,004 237,280 (18,154)2,426,232
Profit/(loss) from continuing operations209,616(296,541)(828,756)(2,581,159)40,016(3,456,824)
Profit/(loss) after tax for the year attributable
to the shareholders
209,616(296,541)(828,756)(2,581,159)40,016(3,456,824)
Other comprehensive income(196,793) - - - - (196,793)
Total comprehensive income/(loss) for the year12,823(296,541)(828,756)(2,581,159)40,016(3,653,617)
Earnings per share - Basic (cents)0.34(0.48)(1.34)(4.19)0.06(5.61)
Earnings per share - Diluted (cents)0.34(0.48)(1.34)(4.16)0.06(5.57)
NOTE 2 • IMPACT OF INITIAL APPLICATION OF NEW NZ IFRS (CONTINUED)NOTE 2 • IMPACT OF INITIAL APPLICATION OF NEW NZ IFRS (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
7879
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
STATEMENT OF CONDENSED
CONSOLIDATED FINANCIAL POSITION
AS AT 31 MARCH 2018
As originally
presented
NZ IFRS 15NZ IFRS 16Restated
$
2(a)(i)
$
2(a)(ii)
$
2(b)(i)
$
2(b)(ii)
$$
CURRENT ASSETS
Cash and cash equivalents21,870,415 - - - - 21,870,415
Restricted Bank Account9,498,071 - - - - 9,498,071
Trade and other receivables13,419,427 - - (1,793,008) - 11,626,419
Contract costs- - - 2,140,135 - 2,140,135
Costs to obtain contracts- - - 1,448,655 - 1,448,655
Finance lease receivable1,816,447 - - (1,816,447) - -
Loan to directors- - - - - -
Intercompany receivables- - - - - -
Current tax receivable21,456 - - - - 21,456
Total Current Assets 46,625,816 - - (20,665) - 46,605,151
NON-CURRENT ASSETS
Property, plant and equipment28,337,668 2,179,700 - (8,172,943) 1,503,802 23,848,227
Intangible assets29,901,469 - - - - 29,901,469
Contract costs- - - 2,204,472 - 2,204,472
Costs to obtain contracts- - - 1,635,487 - 1,635,487
Finance lease receivable4,421,483 - - (4,421,483) - -
Investment in subsidiaries- - - - - -
Loan to shareholders and directors- - - - - -
Deferred tax assets3,878,971 330,639 960,437 1,740,959 42,379 6,953,385
Total Non-Current Assets 66,539,591 2,510,339 960,437 (7,013,508) 1,546,181 64,543,040
TOTAL ASSETS113,165,4072,510,339960,437(7,034,173)1,546,181111,148,191
CURRENT LIABILITIES
Overdrafts- - - - - -
Borrowings10,574,689 - - - - 10,574,689
Trade payables and accruals5,184,311 - - (2) (325,185)4,859,124
PAYABLE TO NZTA9,439,139 - - - - 9,439,139
Current tax payable85,245 - - - - 85,245
Intercompany payable- - - - - -
Contract liabilities- 3,691,883 1,742,998 - - 5,434,881
Deferred revenue2,265,044 (2,265,044) - - - -
Lease liabilities- - - - 801,024 801,024
Employee entitlements1,147,462 - - - - 1,147,462
Total Current Liabilities 28,695,890 1,426,839 1,742,998 (2) 475,839 32,341,564
NON-CURRENT LIABILITIES
Borrowings15,908,670 - - - - 15,908,670
Contract liabilities- 2,982,0721,756,999 - - 4,739,071
Deferred revenue1,236,149 (1,236,149) - - - -
Lease liabilities- - - - 1,264,690 1,264,690
Deferred tax liabilities164,134 43,911 (15,131) (117,050) 51,519 127,383
Total Non-Current Liabilities17,308,9531,789,8341,741,868 (117,050)1,316,20922,039,814
TOTAL LIABILITIES 46,004,843 3,216,673 3,484,866 (117,052) 1,792,048 54,381,378
NET ASSETS 67,160,564 (706,334) (2,524,429) (6,917,121) (245,867) 56,766,813
EQUITY
Share capital80,326,438 - - - - 80,326,438
Translation reserve(540,182) (23,146) 414 28,044 230 (534,640)
Retained earnings(12,625,692) (683,188) (2,524,843) (6,945,165) (246,097)(23,024,985)
TOTAL SHAREHOLDERS' EQUITY 67,160,564 (706,334) (2,524,429) (6,917,121) (245,867) 56,766,813
GROUP
As at 1 April 2018As at 1 April 2017
$$
Retained earnings as originally presented(12,625,692)(13,066,244)
Change in accounting policy - IFRS 15
Sale of hardware and accessories (Note 2(a)(i))(683,188)(385,822)
Sale of installation services (Note 2(a)(ii))(2,524,843)(1,696,267)
Change in accounting policy - IFRS 16
Impact of the new definition of a lease (Note 2(b)(i))(6,945,165)(4,364,539)
Impact on lessee accounting (Note 2(b)(ii))(246,097)(286,225)
Opening retained earnings (23,024,985) (19,799,097)

STATEMENT OF CONDENSED
CONSOLIDATED CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2018
As originally
presented
NZ IFRS 15NZ IFRS 16Restated
$
2(a)(i)
$
2(a)(ii)
$
2(b)(i)
$
2(b)(ii)
$$
Cash flows from operating activities
Cash received from customers 39,172,438 99,360 171,260 366,972 - 39,810,030
Payments to suppliers and employees (36,408,233) 2,240,400 - 203,466 902,661 (33,061,706)
Interest received 161,375 - - (147,922) - 13,453
Interest paid (1,259,442) (99,360) (171,260) (219,050) (147,777) (1,896,889)
Tax received 340,456 - - - - 340,456
Net cash inflow from operating activities 2,006,594 2,240,400 - 203,466 754,884 5,205,344
Cash flows from investing activities
Payments for investment in property, plant &
equipment
(14,519,691) (2,240,400) - 5,444,532 - (11,315,559)
Payments for investment in intangible assets (6,833,083) - - - - (6,833,083)
Payments for investment in contract assets - - - (3,000,865) - (3,000,865)
Payments for investment in customer acquisition
assets
- - - (2,647,133) - (2,647,133)
Net cash outflow from investing activities (21,352,774) (2,240,400) - (203,466) - (23,796,640)
Cash flows from financing activities
Receipts from bank loans 23,731,244 - - - - 23,731,244
Repayments of bank loans (4,277,189) - - - - (4,277,189)
Repayments of lease liability - - - - (754,884) (754,884)
Receipts from issue of equity 21,501,711 - - - - 21,501,711
Payments for costs of raising equity (673,657) - - - - (673,657)
Net cash outflow from financing activities 40,282,109 - - - (754,884) 39,527,225
Net increase/(decrease) in cash held 20,935,929 - - - - 20,935,929
Cash at beginning of the financial period 934,486 - - - - 934,486
Closing cash and cash equivalents (net of
overdrafts)
21,870,415 - - - - 21,870,415
The Group notes that the transition adjustments above differ from the estimated impact of NZ IFRS 15 disclosed in our annual
report for the year ended 31 March 2018. At the time of reporting the Group did not anticipate early adoption of NZ IFRS 16 nor the
significant impact of doing so. This is the first set of Group’s financials statements where NZ IFRS 9, 15 and 16 has been applied.
NOTE 2 • IMPACT OF INITIAL APPLICATION OF NEW NZ IFRS (CONTINUED)NOTE 2 • IMPACT OF INITIAL APPLICATION OF NEW NZ IFRS (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
8081
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
STATEMENT OF CONDENSED
CONSOLIDATED FINANCIAL POSITION
AS AT 1 APRIL 2017
As originally
presented
NZ IFRS 15NZ IFRS 16Restated
$
2(a)(i)
$
2(a)(ii)
$
2(b)(i)
$
2(b)(ii)
$$
CURRENT ASSETS
Cash and cash equivalents935,359----935,359
Restricted Bank Account9,208,289----9,208,289
Trade and other receivables6,800,780--(1,281,247)-5,519,533
Contract costs---1,482,115-1,482,115
Costs to obtain contracts---927,327-927,327
Finance lease receivable498,142--(498,142)--
Current tax receivable361,912----361,912
Total Current Assets 17,804,482 - - 630,053 - 18,434,535
NON-CURRENT ASSETS
Property, plant and equipment23,763,937777,464-(8,756,143)2,153,34717,938,605
Intangible assets28,662,777----28,662,777
Contract costs---2,108,773-2,108,773
Costs to obtain contracts---935,665-935,665
Finance lease receivable906,265--(906,265)--
Deferred tax assets1,925,352154,119651,2951,570,92365,8264,367,515
Total Non-Current Assets 55,258,331 931,583 651,295 (5,047,047) 2,219,173 54,013,335
TOTAL ASSETS73,062,813931,583651,295(4,416,994)2,219,17372,447,870
CURRENT LIABILITIES
Overdrafts873----873
Trade payables and accruals5,632,175---(380,204)5,251,971
Payable to NZTA9,243,383----9,243,383
Contract liabilities-3,403,5511,166,385--4,569,936
Deferred revenue2,656,518(2,656,518)----
Lease liabilities----727,406727,406
Employee entitlements1,201,002----1,201,002
Total Current Liabilities 18,733,951 747,033 1,166,385 - 347,202 20,994,571
NON-CURRENT LIABILITIES
Borrowings7,029,304----7,029,304
Contract liabilities-2,311,5261,187,445--3,498,971
Deferred revenue1,743,824(1,743,824)----
Lease liabilities----2,093,1922,093,192
Deferred tax liabilities-2,670(6,268)(49,805)56,8123,409
Total Non-Current Liabilities8,773,128570,3721,181,177(49,805)2,150,00412,624,876
TOTAL LIABILITIES 27,507,079 1,317,405 2,347,562 (49,805) 2,497,206 33,619,447
NET ASSETS 45,555,734 (385,822) (1,696,267) (4,367,189) (278,033) 38,828,423
EQUITY
Share capital58,965,367----58,965,367
Translation reserve(343,389)--(2,650)8,192(337,847)
Retained earnings(13,066,244)(385,822)(1,696,267)(4,364,539)(286,225)(19,799,097)
TOTAL SHAREHOLDERS' EQUITY 45,555,734 (385,822) (1,696,267) (4,367,189) (278,033) 38,828,423
Note 2(a) NZ IFRS 15 Revenue from Contracts with Customers
The Group no longer classifies its customer contracts as lease contracts having early adopted the new determination of a lease
under NZ IFRS 16. All customer contracts are now accounted for under NZ IFRS 15 as service contracts. Refer to Note 1 for
judgements made.
2(a)(i) Sale of hardware and accessories
The Group reversed the revenue received for the sale of hardware and accessories, increasing the deferred revenue balance with
a corresponding adjustment to revenue and retained earnings. In addition to this, hardware assets previously de-recognised
as part of a sale have been recognised as property, plant and equipment, with a corresponding adjustment being made to
depreciation, accumulated depreciation and retained earnings. The hardware assets recognised are measured at cost and
depreciated based on their estimated useful economic lives. The impact of the adjustments for each financial statement line item
affected is stated above in Note 2.
2(a)(ii) Sale of installation services
Following the adoption of NZ IFRS 15, installation revenue previously recognised has been allocated to a contract liability
(deferred revenue) where the contracts have been determined to not yet be complete at the period end, with a corresponding
adjustment being made to revenue and retained earnings. The corresponding contract costs associated to the installation of
hardware units is concluded to be a cost of fulfilling the contract and has been capitalised as a contract asset by adjusting
expenses and retained earnings. The costs of fulfilling the contract are amortised based on the expected useful life of the
contract asset. The impact of the adjustments for each financial statement line item affected is stated above in Note 2.
Note 2(b) NZ IFRS 16 Leases
NZ IFRS 16 replaces NZ IAS 17 Leases and sets out the principles for the recognition, measurement, presentation and disclosure
of leases. The standard identifies a lease within a contract if the contract conveys the right to control the use of an identified
asset for a period of time in exchange for consideration. It introduces significant changes to lessee accounting by removing the
distinction between operating and finance leases and requiring the recognition of a right-of-use asset and a lease liability at the
lease commencement for all leases, except for short-term leases and leases of low value assets. In addition to this, the standard
specifically requires for the separating of components of a contract into the lease and non-lease components.
In the current year, the Group has applied NZ IFRS 16 in advance of its effective date. The date of initial application of NZ IFRS
16 for the Group is 1 April 2017. The group has applied NZ IFRS 16 using the full retrospective approach, with restatement of
comparative information. The Group have elected to apply practical expedients with respect to short term leases. The Directors
are of the view that early adopting the NZ IFRS 16 at the same time as NZ IFRS 15 is the most appropriate approach, given that
the majority of EROAD’s contracts have been classified as leases under NZ IAS 17. The change in the definition to the right to
direct the use and control as the EROAD hardware has a significant impact on the new NZ IFRS 15 revenue recognition and
therefore the Directors decided to adopt the new revenue and lease standards concurrently.
2(b)(i) Impact of the new definition of a lease as a lessor
Prior to the adoption of NZ IFRS 16, the group accounted for the rental of hardware units to customers as either operating or finance
leases based on an assessment of whether substantially all the risks and rewards of ownership had been transferred to the customer.
Contracts deemed to be a finance lease were accounted for by derecognising the sold hardware asset and recognising a sale at the
inception of the contract.
As a result of the change in definition of leases within the standard, these contracts are now accounted for under NZ IFRS 15.As
a result of the contracts no longer meeting the definition of a lease, initial direct costs of obtaining the lease contract which were
previously capitalised under NZ IAS 17, have been reassessed under NZ IFRS 15. Applying NZ IFRS 15, the Group has reassessed
historical capitalised amounts based on the new definitions within NZ IFRS 15. The Group has capitalised the costs that are incremental
in obtaining contracts with customers in accordance with NZ IFRS 15. The Group performed a reallocation of revenue and expenses
based on the change in accounting policy, the impact of the adjustments for each financial statement line item affected is stated above
at Note 2. The impact of restating previously recognised finance leases has had a significant impact on the restatement of comparative
numbers. The impact of the adjustments for each financial statement line item affected is stated above in Note 2.
2(b)(ii) Impact on lessee accounting
Former Operating Leases as a lessee
Under NZ IFRS 16 the Group has now ra right-of-use asset and lease liability in the consolidated statement of financial position
initially measured at the present value of future lease payments. The Group has also recognised depreciation of the right-of-use
asset and interest on lease liabilities in the consolidated statement of comprehensive income. Payments made are separated
into a principal portion (presented within financing activities) and interest portion (presented within operating activities) in the
consolidated statement of cash flows. The impact of the adjustments for each financial statement line item affected is stated above
in Note 2.
NOTE 2 • IMPACT OF INITIAL APPLICATION OF NEW NZ IFRS (CONTINUED)NOTE 2 • IMPACT OF INITIAL APPLICATION OF NEW NZ IFRS (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
8283
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
Note 2(c) NZ IFRS 9 Financial Instruments
NZ IFRS 9, as it relates to the Group, replaces the provisions of NZ IAS 39 that relate to the recognition, classification, measurement
and impairment of financial assets. The adoption of NZ IFRS 9 from 1 April 2018 resulted in changes in accounting policies however
has not resulted in material changes to amounts recognised in the consolidated interim financial statements.
Classification and measurement
NZ IFRS 9 impacts the following classifications of financial assets:
• Cash
• Trade and other receivables
There was no change in the fair value of the financial assets as a result of the reclassification.
NOTE 3 • REVENUE FROM CONTRACTS WITH CUSTOMERS
GROUP
20192018

$ $
Restated
Revenue from contracts with customers
Software as a Service (SaaS) revenue57,432,65640,418,366
Other
Transaction fee revenue 2,376,2321,847,006
Grant revenue859,746894,552
Other revenue683,262606,572
Total Revenues61,351,89643,766,496
Set out above is the disaggregation of the Group’s revenue from contracts with customers. The disaggregation reflects the nature,
amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Specifically, software as a service
(SaaS) revenue represents revenue earned from customer contracts for the sale or rental of hardware, installation services and
provision of software services. Transaction fee revenue relates to the collection of Road User Charges (RUC) fees. Refer to Note 1 for
the accounting policy.
Transaction price allocated to the remaining performance obligations
The below table represents the revenue allocated to performance obligations that are unsatisfied or partially unsatisfied at the
period end. The revenue amounts yet to be recognised under non-cancellable contract agreements at 31 March are expected to be
recognised by EROAD based on the time bands disclosed below.
GROUP
20192018

$ $
Restated
Software as a Service (SaaS) revenue
Not later than one year 56,372,816 47, 3 47, 97 8
Later than one year not later than five years 61,037,759 53,109,822
Later than five years - -
Total price allocated to remaining performance obligations117,410,575100,457,800
The Group reports the Non-GAAP measure, Future Contracted Income, to align with the change in accounting policies the definition
of Future Contracted Income has been amended to include all future hardware and SaaS cash inflows relating to income under non-
cancellable long-term agreements. The disclosure above aligns with the Future Contracted Income reported by the Group.
NOTE 4 • OPERATING EXPENSES
GROUP
20192018

Note
$ $
Restated
Personnel expenses - net of capitalised employee remuneration
621,202,34315,898,987
Administrative and other operating expenses17,080,92511,675,364
SaaS platform costs6,663,2504,983,418
Directors fees26352,266259,070
Auditor's remuneration - KPMG278,500189,525
Tax compliance services - KPMG111,43457,509
Tax advisory services - KPMG29,99969,554
Corporate Finance - KPMG*-88,019
Total operating expenses45,718,71733,221,446
* Gross Corporate Finance fees were $40,000 (2018: $250,393) of which $40,000 (2018: $162,374) was capitalised. These fees
were for advice provided in relation to the debt restructuring which took place during the period.
During the year the costs expensed for Research and Development was $5,081,712 (2018: $4,472,760).
NOTE 5 • SEGMENTAL NOTE
The Group has three segments as described below, which are the Group’s strategic divisions. The strategic divisions offer
different services and are managed separately because they require different technology, services and marketing strategies.
For each strategic division, the Group’s CEO (the chief operating decision maker) reviews internal management reports. The
following summary describes the operations in each of the Group’s segments.
EROAD reports selected financial information segmented by geographic location for operating companies and corporate and
development costs.
• Corporate & Development: Corporate head office costs and R&D activities for development of new and existing products and
services
• North America: Operating companies serving customers in North America
• Australia & New Zealand: Operating companies serving customers in Australia & New Zealand
Inter-segment pricing is determined on an arm’s length basis.
NOTE 2 • IMPACT OF INITIAL APPLICATION OF NEW NZ IFRS (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
8485
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
Reportable segment information
Information related to each reportable segment is set out below. Segment result represents Earnings before Interest, Taxation,
Depreciation & Amortisation (EBITDA), which is the measure reported to the chief operating decision maker.
Corporate & DevelopmentNorth AmericaAustralia & New Zealand
201920182019201820192018
$ $
Restated
$ $
Restated
$ $
Restated
Revenue
Software as a Service (SaaS) revenue--15,277,1757,712,70342,155,48132,705,663
Transaction fee revenue ----2,376,2321,847,006
Other revenue ₁12,853,54022,656,601421,373183,564276,685368,185
12,853,54022,656,60115,698,5487,896,26744,808,39834,920,854
Earnings Before Interest, Taxation,
Depreciation & Amortisation
(11,962,696)(4,868,846)404,656(3,374,613)27,300,82322,114,158
Total assets85,397,21072,528,18118,794,17417,112,07242,031,36333,732,415
Depreciation of Property, Plant &
Equipment
(771,830)(888,034)(3,181,224)(1,657,788)(3,798,308)(3,285,883)
Amortisation of Intangible Assets(6,479,134)(5,594,391)----
Amortisation of Contract and Customer
Acquisition Assets
--(1,109,861)(637,374)(3,742,232)(3,035,755)

₁ Revenue from Corporate & Development Markets includes R&D Grant Income of $859,746 (2018:$894,552).
Reconciliation of information on reportable segments
GROUP
20192018
$ $
Restated
Revenue
Total revenue for reportable segments73,360,48665,473,722
Elimination of inter-segment revenue(12,008,590)(21,707,226)
Consolidated Revenue61,351,89643,766,496
EBITDA
Total EBITDA for reportable segments15,742,78313,870,699
Elimination of inter-segment EBITDA(109,604)(3,325,649)
Consolidated EBITDA15,633,17910,545,050
Depreciation
Total depreciation for reportable segments(7,751,362)(5,831,705)
Elimination of inter-segment profit1,130,090470,314
Consolidated Depreciation(6,621,272)(5,361,391)
Total assets
Total assets for reportable segments146,222,747123,372,668
Elimination of inter-segment balances(23,023,170)(12,224,477)
Consolidated Total assets123,199,577111,148,191
Allocation of Development Assets
Included within Total Assets are Development Assets of $29,764,349 (2018: $26,852,630) which for the purpose of the segment
note have been allocated to the Corporate & Development Market based on the ownership of intellectual property. The amortisation
for these assets are also presented in the Corporate & Development segment. For impairment testing purposes management
allocate the Development Assets to the cash generating units (CGUs) based on the specific CGU that the Development Asset
relates to, or if the Development Asset is developed for use globally across all CGU’s, the asset is allocated to CGU’s based on
the proportionate share of the Group’s Contracted Units. At 31 March 2019 there was $18,868,409 (2018: $16,911,642) of global
Development Assets that have been allocated across CGU’s based on the Contracted Units. The allocation of the Development
Asset to CGU’s within the following reportable segments for the purpose of impairment testing was as follows:
20192018

$$
Development Assets allocated to North America
13,442,77812,822,744
Development Assets allocated to Australia & New Zealand16,321,57114,029,886
Total Development Assets29,764,34926,852,630
Geographic information
The geographic information below analyses the Group’s revenue and non-current assets by the Company’s country of domicile and
other countries. In presenting the following information segment revenue has been based on the geographic location of customers
and segment assets were based on the geographic location of the assets.
20192018

$ $
Restated
Revenue
New Zealand45,010,14935,443,672
All foreign countries:
USA15,698,5487,896,267
Australia643,199426,557
Total revenue61,351,89643,766,496
Non-current assets
New Zealand58,282,60445,669,216
All foreign countries:
USA13,276,19111,527,106
Australia237,801393,333
Total non-current assets71,796,59657,589,655
Non-current assets exclude financial instruments and deferred tax assets.
NOTE 5 • SEGMENTAL NOTE (CONTINUED)NOTE 5 • SEGMENTAL NOTE (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
8687
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
NOTE 6 • PERSONNEL EXPENSES
GROUP
20192018

$ $
Restated
Salaries and wages - excluding capitalised commission costs
23,663,10319,897,273
Annual leave 173,682(107,912)
Performance bonus700,337894,983
Share-based payments367,946268,754
Salaries and wages capitalised to Development and Software Assets(3,702,725)(5,054,111)
21,202,34315,898,987
NOTE 7 • CONTRACT FULFILMENT AND COSTS TO OBTAIN CONTRACTS
The Group capitalises incremental costs of fulfilling customer contracts, typically distribution and installation costs. The Group
also capitalises costs that are incremental in obtaining contracts with customers, typically sales commissions. Both contract
fulfillment and costs to obtain contracts are amortised evenly over the period of the contract. The majority of contracts are for
3 years and can be for a term of up to 5 years.
The following table provides information about contract fulfilment and costs to obtain contracts with customers.
Contract FulfilmentCosts to obtain contracts
2019201820192018

$$$$
Opening Net Book Value
4,344,607 3,590,888 3,084,142 1,862,992
Additions 3,527,493 3,000,865 3,247,387 2,647,133
Amortisation (2,784,531) (2,247,146) (2,067,562) (1,425,983)
Closing Net Book Value 5,087,569 4,344,607 4,263,967 3,084,142
Current 2,424,626 2,140,135 2,163,888 1,448,655
Non-current 2,662,943 2,204,472 2,100,079 1,635,487
NOTE 8 • FINANCE INCOME & FINANCE EXPENSES
GROUP
20192018

$ $
Restated
Finance income
Interest income19,64513,453
Foreign exchange gains9,23984,241
28,88497,694
Finance expenses
Interest expense(2,178,386)(1,259,442)
Interest expense - Lease Liabilities(151,456)(147,777)
Interest expense - Contract Liabilities(486,141)(489,670)
(2,815,983)(1,896,889)
Net financing costs(2,787,099)(1,799,195)
NOTE 9 • INCOME TAX EXPENSE
GROUP
20192018

$
$
Restated
(a) Reconciliation of effective tax rate
Profit/(Loss) before income tax(5,106,419)(5,883,056)
Income tax using the Company’s domestic tax rate of 28% (1,429,796)(1,647,256)
Reduction in tax rate-(121,090)
Non-deductible expense/(non-assessable income)963,98724,909
Temporary differences
Losses and timing differences (recognised)/not recognised-(840,233)
Effect of different tax rates274,610157,438
Income tax expense/(benefit)(191,199)(2,426,232)
(b) Current tax (benefit)/expense
Current year(36,406)107,774
(36,406)107,774
(c) Deferred tax (benefit)/expense
Current year(154,791)(2,534,006)
(154,791)(2,534,006)
At 31 March 2019 there were no imputation credits available to shareholders (2018: Nil)
NOTE 10 • DEFERRED TAX ASSETS / (LIABILITIES)
GROUP
20192018

$
$
Restated
Recognised deferred tax assets and liabilities
Deferred tax assets and (liabilities) are attributable to the following:
Tax loss carry forward 9,334,583 9,085,688
Property, plant and equipment (1,271,278)(277,215)
Deferred development expenditure (3,601,548)(3,826,229)
Provisions, accruals and other liabilities 2,582,438 948,053
Equity-settled share-based payments 262,047 191,046
Revenue recognition (151,356) 704,659
Total deferred tax asset/(liability)7,160,4716,826,002
The movement in temporary differences has been recognised in profit or loss. Deferred tax assets have been recognised at a
rates between 21% to 30% at which they are expected to be realised.
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
8889
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
Movement in temporary differences during the period:
Group
Balance
31-Mar-19
Recognised in
profit or loss
Under/(over)
from prior
periods
Changes in
tax rates
Currency
Translation
Balance
31-Mar-18
Movement in
Period
Balance
31-Mar-17
$$$$$$
Restated
$
Restated
$
Restated
Tax loss carry
forward
9,334,583 275,236(71,410)- 45,069 9,085,688 2,228,927 6,856,761
Property, plant
and equipment
(1,271,278) (1,088,027)-- 93,964 (277,215) 633,713 (910,928)
Deferred
development
expenditure
(3,601,548) 224,681 -- - (3,826,229) (878,256)(2,947,973)
Provisions,
accruals and
other liabilities
2,582,438 1,429,604 188,760- 16,021 948,053 75,108 872,945
Equity-settled
share-based
payments
267,632 76,586 -- - 191,046 64,662 126,384
Revenue
recognition
(151,356) (994,220)149,989- (11,784) 704,659 337,743 366,916
Total 7,160,471 (76,140) 267,339 - 143,270 6,826,002 2,461,897 4,364,105
The New Zealand tax group consists of EROAD Limited, EROAD New Zealand Limited and EROAD Financial Services Limited.
Losses incurred within this Group are transferred within the Group with no compensation being recognised. Deferred tax assets
have been recognised in respect of these items as based on the expected profitability of the New Zealand tax Group it is considered
future taxable profit will be available for utilisation against the carried forward losses.
Determining the extent to which losses will be utilised requires judgement. The Group has forecast expected utilisation of tax losses.
Key assumptions included Total Contracted Unit, revenue and expense forecasts in line with Groups budget and three-year forecast
supported by a robust strategic and business planning process, in addition to the estimated impact of group transfer pricing
policies and the forecast impact of timing differences.
The results of the forecasting indicate that there will be sufficient profitability within the New Zealand tax group to utilise the
existing tax losses. Losses incurred in recent years have been the result of large investment creating the new North American
market. Whilst the business is now entering a new market in Australia, the Group considers this can be achieved at a lower cost than
the entry into North America, by leveraging our New Zealand expertise and cost and customer base. The Group expect to be able
to report significant improvements in profitability over the next three years as the business reaches a sufficiently large subscriber
base to self-fund operating and corporate costs. Due to the cumulative subscription nature of our business model as well as certain
operating expenses that do not scale at the same rate of unit and revenue growth, the business is expected to able to achieve its
forecast growth in profitability.
The Group performed sensitivity analysis on the forecast utilisation of tax losses by reducing forecast transfer pricing charges to
overseas subsidiaries by 50%. Under both base case and sensitivity scenario, the Group expects that unused tax losses will be
utilised within 4 years.
NOTE 11 • PAID UP CAPITAL
All issued shares are fully paid up and have equal voting rights and share equally in dividends and surplus on winding up.
GROUP
Number of
ordinary shares
Issue price
$
Issued Capital
$
At 31 March 201760,245,66058,965,367
Issue of shares to staff under LTI schemes490,000$2.151,053,500
Held in trust as treasury stock (1,053,500)
Vested under LTS scheme37,818
Shares issued to employees for 2017 bonus281,351$1.65463,976
Vested under LTI scheme31,223
Shares issued in December 2017 Equity Placement5,099,247$3.0415,501,711
Shares issued in March 2018 Share Purchase Plan1,973,673$3.046,000,000
Costs of raising capital (673,657)
At 31 March 201868,089,93180,326,438
Vested under LTS scheme 34,425
Shares issued to employees for 2018 bonus 18,136 59,999
Shares issued to employees for 2018 bonus 54,000 191,561
Issue of shares to staff under LTI schemes116,705$3.89453,959
Held in trust as treasury stock (453,959)
At 31 March 201968,278,77280,612,423

At 31 March 2019 there was 68,278,772 authorised and issued ordinary shares (2018: 68,089,931). 972,484 (2018: 906,783) shares
are held in trust for employees in relation to the long-term incentive plan and are accounted for as treasury stock.
On 15 December 2017, the Company issued 5,099,247 new shares at a price of $3.04 per share under an equity placement which
raised $15,501,711. Additionally on 6 March 2018, the company allotted an additional 1,973,673 new shares relating to $6,000,000
raised under a share purchase plan at a price of $3.04 per share.
The calculation of both basic and diluted earnings per share at 31 March 2019 was based on the profit attributable to ordinary
shareholders of ($4,900,057) (2018: $209,616). The weighted number of ordinary shares was 67,283,918 (2018: 61,668,093) for
basic earnings per share and 67,903,457 for diluted earnings per share (2018: 62,027,558).
Other components of equity include:
• Translation reserve - comprises foreign currency translation differences arising from the translation of financial statements of
the Group’s foreign subsidiaries into New Zealand Dollars.
• Retained earnings - includes all current and prior period retained profits and share-based employee remuneration.
NOTE 10 • DEFERRED TAX ASSETS / (LIABILITIES) (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
9091
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
NOTE 12 • CASH AND CASH EQUIVALENTS AND RESTRICTED CASH
GROUP
20192018
$$
Cash and bank16,138,80621,870,415
16,138,80621,870,415
Cash and cash equivalents exclude restricted bank accounts. Restricted bank accounts are presented separately from cash and
cash equivalents on the face of the Statement of Financial Position and movements in restricted bank accounts are excluded
from the Statement of Cash Flows. The restricted bank accounts relate to Road Users tax collected from clients due for payment
to the appropriate government agency.
NOTE 13 • TRADE AND OTHER RECEIVABLES
GROUP
20192018

$ $
Restated
Trade receivables6,519,4538,251,355
Expected credit losses(675,207)(555,073)
5,844,2467,696,282
Prepayments and other receivables 4,657,8773,930,137
10,502,12311,626,419
In addition to the movement in the expected credit losses, the Group has written off $343,919 (2018: $56,334) of bad debts to
the statement of comprehensive income during the year ended 31 March 2019. The Group’s trade receivables are subject to NZ
IFRS 9’s expected credit loss model. The Group has applied the NZ IFRS 9 simplified approach to measuring expected credit
losses which uses a lifetime expected credit loss allowance and the future collectabillity for all trade receivables.
(a) Credit risk
The aging of the Group’s Trade receivables at the reporting date was as follows:
GROUP
Gross 2019
Allowance for
doubtful debts
2019 Gross 2018
Allowance for
doubtful debts
2018

$$$$
Not past due3,703,562(28,048)3,914,796(14,600)
Past due 1-30 days1,340,992(34,678)1,732,962(80,123)
Past due 31-60 days476,940(39,017)843,233(56,801)
Past due over 61 days9 9 7, 9 5 9(573,464)1,760,364(403,549)
6,519,453 (675,207)8,251,355(555,073)
NOTE 14 • PROPERTY, PLANT AND EQUIPMENT
GROUP
Right of Use
Assets
Hardware
Assets
Plant and
equipment
Leasehold
improvements
Motor
vehicles
Office
equipmentComputersTotal
$
Restated
$
Restated
$ $
Restated
$ $ $ $
Restated
Year ended 31 March 2018
Opening net book amount as
originally presented
-21,718,976128,198579,147414,148438,158485,31023,763,937
Adjustment on application
of NZ IFRS 15 & NZ IFRS 16
2,171,904(7,990,481)-(36)---(5,818,613)
Opening net book amount
- restated
2,171,90413,728,495128,198579,111414,148438,158485,31017,945,324
Additions-10,840,240158,808-166,93581,65751,02811,298,668
Disposals----(42,170)-(3,205)(45,375)
Depreciation charge(649,520)(3,775,467)(69,011)(132,901)(165,270)(202,180)(367,042)(5,361,391)
Depreciation recovered----34,633-62335,256
Effect of movement in
exchange rates
(18,522)2,884-(5,726)-(2,112)(779)(24,255)
Closing net book amount1,503,86220,796,152217,995440,484408,276315,523165,93523,848,227

Cost4,119,23431,721,956506,7291,096,375930,9181,013,7732,570,00241,958,987
Accumulated depreciation(2,615,372)(10,925,804)(288,734)(655,891)(522,642)(698,250)(2,404,067)(18,110,760)
Net book amount1,503,86220,796,152217,995440,484408,276315,523165,93523,848,227
GROUP
Right of Use
Assets
Hardware
Assets
Plant and
equipment
Leasehold
improvements
Motor
vehicles
Office
equipmentComputersTotal
$$$$$$$$
Year ended 31 March 2019
Opening net book amount as
originally presented
-26,789,392217,995440,547408,276315,523165,93528,337,668
Adjustment on application
of NZ IFRS 15 & NZ IFRS 16
1,503,862 (5,993,240) - (63) - - - (4,489,441)
Opening net book amount
- restated
1,503,86220,796,152217,995440,484408,276315,523165,93523,848,227
Additions5,383,4288,678,488120,6121,355,856242,67097,313255,58316,133,950
Disposals(2,680,438)--(8,394)(132,376)--(2,821,208)
Depreciation charge(758,290)(5,119,426)(91,019)(172,795)(168,650)(144,562)(166,530)(6,621,272)
Depreciation recovered2,516,661913,552-3,17295,953--3,529,338
Effect of movement in
exchange rates
60,370(260,410)-21,744118,1632,376(167,746)
Closing net book amount6,025,59325,008,356247,5881,640,067445,884276,437257,36433,901,289

Cost6,915,08540,362,7996 2 7, 3 4 22,478,4651,041,2131,131,1212,837,17355,393,198
Accumulated depreciation(889,492)(15,354,443)(379,754)(838,398)(595,329)(854,684)(2,579,809)(21,491,909)
Net book amount6,025,59325,008,356247,5881,640,067445,884276,437257,36433,901,289
Included in the Hardware Assets is equipment under construction of $6,996,599 (2018: $5,219,062).
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
9293
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
NOTE 15 • LEASES AS A LESSEE
Property, plant and equipment’ disclosed in Note 14 comprises owned and leased assets.
GROUP
20192018
Note$$
Right-of-use assets - Property leases 6,025,593 1,503,862
14 6,025,593 1,503,862
The Group leases relate to land and buildings for its office space. The leases of office space typically run for a period of 1 to 9 years. Some
leases provide for additional rent payments that are based on changes in local price indices. Information about leases for which the Group
is a lessee is presented below.
GROUP
20192018
Right-of-use assets Note$$
Opening Net Book Value 1,503,862 2,171,904
Additions 5,383,428 -
Disposals (2,680,438) -
Depreciation (758,290) (649,520)
Depreciation recovered 2,516,661 -
Effect of movement in exchange rates 60,370 (18,522)
Closing Net Book Value14 6,025,593 1,503,862
GROUP
20192018
Lease Liabilities$$
Maturity analysis - contractual undiscounted cash flows
Less than one year 1,174,643 902,045
One to five years 4,564,648 1,401,723
More than five years 3,055,900 -
Total undiscounted lease liabilities 8,795,191 2,303,768
Lease liabilities included in the statement of financial position 7,029,309 2,065,714
Current 782,450 801,024
Non-current 6,246,859 1,264,690
Amounts recognised in Statement of Comprehensive Income
GROUP
20192018
$$
Interest expense on lease liabilties 151,456 147,777
Amounts recognised in Statement of Cash Flows
GROUP
20192018
$$
Total cash outflow for leases 921,029 754,884
NOTE 16 • INTANGIBLE ASSETS
GROUPPatentsTrade MarksDevelopmentSoftwareTotal
$$$$$
Year ended 31 March 2018
Opening net book amount14,65132,57626,197,4262,418,12428,662,777
Additions--5,309,7361,523,3476,833,083
Disposals-----
Amortisation charge(350)-(4,654,532)(939,509)(5,594,391)
Closing net book amount14,30132,57626,852,6303,001,96229,901,469
Cost17,80032,57637,995,3485,530,20643,575,930
Accumulated amortisation(3,499)-(11,142,718)(2,528,244)(13,674,461)
Net book amount14,30132,57626,852,6303,001,96229,901,469
GROUPPatentsTrade MarksDevelopmentSoftwareTotal
$$$$$
Year ended 31 March 2019
Opening net book amount14,30132,57626,852,6303,001,96229,901,469
Additions--8,334,8711,375,0799,709,950
Disposals-----
Amortisation charge(2,037)-(5,423,152)(1,053,945)(6,479,134)
Closing net book amount12,26432,57629,764,3493,323,09633,132,285
Cost17,80032,57646,330,2196,905,28553,285,880
Accumulated amortisation(5,536)-(16,565,870)(3,582,189)(20,153,595)
Net book amount12,26432,57629,764,3493,323,09633,132,285
The useful lives of the Group’s Intangible Assets are assessed to be finite. Assets with finite lives are amortised over their
useful lives and tested for impairment whenever there are indications that the assets may be impaired. Where an indicator
of impairment exists the Group makes a formal assessment of the recoverable amount. Where the carrying value of an asset
exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. The recoverable
amount is the greater of fair value less costs to sell of the assets value in use. For the purposes of assessing impairment, assets
are Grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).
Recoverability of development costs
Included in the carrying amount of development costs at 31 March 2019 is an amount of $13,371,021 (2018: $12,822,744) relating to
our North American Market. Management note unit sales within the North American Market were lower than originally expected
and as a result management has carried out an impairment test.
The recoverable amount of the CGU that these corporate assets relate to (North American Market) was estimated based on the
present value of future cash flows expected to be derived from the CGU (value in use).
Key assumptions included for the impairment review included Total Contracted Unit, revenue and expense forecasts in line with
Groups budget and three-year forecast, a pre-tax discount rate of 14% and a terminal growth rate of 1.9%. Sensitivity analysis
was performed by reducing forecasted non-committed Contracted Unit growth by 50% over the forecast period at base case
discount and terminal growth rates. A separate sensitivity analysis was performed by increasing the discount rate to 20% and
lowering the terminal growth rate to 1.4% at base case Contracted Unit and Revenue growth. The results of both sensitivity
scenarios still resulted in headroom between the recoverable amount of the CGU and its carrying value.
The Group concluded that the recoverable amount of the CGU to be higher than its carrying value and therefore no impairment
was considered necessary.
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
9495
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
NOTE 17 • TRADE PAYABLES AND ACCRUALS
GROUP
20192018

$ $
Restated
Trade creditors3,521,8842,471,662
Sundry accruals2,589,5462,387,462
6,111,4304,859,124
NOTE 18 • BORROWINGS
GROUP
20192018
$$
Current borrowings
Term Loans - NZ $ denominated 6,149,240 7,425,008
Term Loans - US $ denominated 8,476,936 1,564,784
NZ Growth Funding - Committed Cash Advance Facility 1,809,997 1,102,579
US Growth Funding - Committed Cash Advance Facility 800,743 716,622
Capitalised borrowing costs (74,249)(234,304)
17,162,66710,574,689
Non-current borrowings
Term Loans - NZ $ denominated 1,499,620 9,448,670
Term Loans - US $ denominated 10,239,608 2,636,790
NZ Growth - Committed Cash Advance Facility 4,288,939 2,482,044
US Growth - Committed Cash Advance Facility 1,447,862 1,341,166
17,476,02915,908,670
Terms and debt repayment schedule
Nominal
Interest
Year of
Maturity
2019
Face Value
2019
Carrying
amount
2018
Face Value
2018
Carrying
Amount
$$$$
Term Loans - NZ $ denominated
5.00%20206,818,8816,818,88116,873,67816,873,678
Term Loans - US $ denominated
5.55%202019,546,52319,546,5234,201,5744,201,574
NZ Growth - Committed Cash Advance
Facility
4.47%20206,098,9366,098,9363,584,6233,584,623
US Growth - Committed Cash Advance
Facility
4.98%20202,248,6052,248,6052,057,7882,057,788
Capitalised borrowing costs - 2020-(74,249)-(234,304)
34,712,94534,638,69626,717,66326,483,359
On 3 July 2017, in order to support funding requirements in connection with the Group’s growth and to manage the related working
capital requirements, the Company entered into a Multi-Option Credit Facility Agreement with the Bank of New Zealand (BNZ). The
agreement was subsequently amended and restated in December 2017 and October 2018. At 31 March 2019, EROAD had the following
facilities in place:
$5,250,000 Term Loan Facility A – to restructure existing term facilities. The Term Loan has a term of 24 months from the October
refinance date, with the facility having a maturity date in October 2020. The interest rate is variable based on the 3-month BKBM bid
plus a margin of 3.10%. Principal and interest payments are made quarterly in line with a 30 month repayment profile.
$5,998,480 (NZD) Term Loan Facility B – used to restructure the Outstanding Amount under the Committed Cash Advances Facility
as at the First Amendment Date in December 2017. The Term Loan has a term of 24 months from the October 2018 refinance date, with
the facility having a maturity date in October 2020. The interest rate is variable based on the 3-month BKBM bid plus a margin of 3.10%.
Principal and interest payments are made quarterly in line with a 33 month repayment profile.
$2,182,057 (USD) Term Loan Facility B – used to restructure the Outstanding Amount under the Committed Cash Advances Facility as
at the First Amendment Date in December 2017. The Term Loan has a term of 24 months from the October 2018 refinance date, with
the facility having a maturity date in October 2020. The interest rate is variable based on the 3-month US LIBOR plus a margin of 3.10%.
Principal and interest payments are made quarterly in line with a 33 month repayment profile.
$12,966,043 (NZD) Term Loan Facility E – used to restructure the Outstanding Amount under the Committed Cash Advances Facility
as at the Second Amendment Date in October 2018. The Term Loan has a term of 24 months from the October 2018 refinance date,
with the facility having a maturity date in October 2020. The interest rate is variable based on the 3-month BKBM bid plus a margin of
3.10%. Principal and interest payments are made quarterly in line with a 33 month repayment profile.
$3,264,184 (USD) Term Loan Facility E – used to restructure the Outstanding Amount under the Committed Cash Advances Facility as
at the Second Amendment Date in October 2018. The Term Loan has a term of 24 months from the October 2018 refinance date, with
the facility having a maturity date in October 2020. The interest rate is variable based on the 3-month US LIBOR plus a margin of 3.10%.
Principal and interest payments are made quarterly in line with a 33 month repayment profile.
$20,000,000 Committed Cash Advance Facility – to finance the up-front costs in connection with securing Future Contracted Income.
The Committed Cash Advance Facility has a 16 month term from the December refinance date, with the facility having a maturity date
in October 2020. Structurally the facility is paid down and redrawn (revolving credit) each time the Company presents a certificate
outlining the Group’s growth in new Future Contracted Income on a monthly basis. For drawings in New Zealand Dollars of a 1-month
duration, the interest rate is the 1-month BKBM plus margin of 2.50%. For drawings in USD of a 1-month duration, the interest rate is the
1 month US LIBOR plus a margin of 2.50%. In addition to a 1.50% line fee on the total facility limit, payable quarterly in advance.
$5,150,000 Overdraft Facilities – for general working capital purposes. This is an on demand facility with the interest rate based on the
Market Connect Overdraft Prime Rate plus a margin of 1%.
EROAD’s operating covenants to support the above facilities include Loan to Total FCI Ratio, Interest Cover Ratio, Total Assets
(Obligators) to Total Assets (Group) ratio, and an umbrella limit on the aggregate of all facilities being below $40,000,000. EROAD was
compliant with all covenants during the period and at 31 March 2019.
The security package for the Multi-Option Credit Facility Agreement includes an all obligations cross-guarantee granted by EROAD
Australia Pty Limited and EROAD Inc in favour of the BNZ in respect of the obligations of EROAD Limited, and a General Security
Agreements granted by EROAD Limited, EROAD Inc and EROAD Australia Pty Limited in favour of the BNZ as secured parties.
NOTE 19 • CONTRACT LIABILITIES
The Group enters into contracts with customers for the provision of software services over a contracted period. As stated in the
accounting policies, this revenue is recognised over time as the customer simultaneously receives and consumes the benefit
of the service. The Group has determined that the benefit of the services provided is consumed evenly over the period of the
contract, and thus the performance obligations are satisfied evenly over the period. Where the Group receives a portion of the
transaction price of a contract in advance, this is recognised as a contract liability and released over the contract period as the
Group satisfies its performance obligations.
NOTE 18 • BORROWINGS (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
9697
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
GROUP
20192018
$ $
Restated
Opening balance
10,173,9528,068,907
Amounts deferred during the period5,048,7437, 7 70, 4 2 7
Amount recognised in the Statement of Comprehensive Income(5,255,272)(5,665,382)
9,967,42310,173,952
Current5 , 7 57, 9 5 15,434,881
Non-current4,209,4724,739,071
At 31 March 2019, $5,757,951 is expected to be recognised in the statement of comprehensive income in the next financial period
and has been classified as current in the balance sheet (2018: $5,434,881).
NOTE 20 • FINANCIAL RISK MANAGEMENT
The Group’s principal financial instruments include trade receivables and payables, cash and short term deposits, and advances from
Group companies.
As a result of the Group’s operations and sources of finance, it is exposed to credit risk, liquidity risk and market risks which include foreign
currency risk, commodity price risk and interest rate risk. These risks are described below.
The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The
Group’s risk management policies are established to identify and analyse the financial risks faced by the Group, to set appropriate risk
limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect
changes in market conditions and the Group’s activities.
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the
basis upon which income and expenses are recognised, in respect of each class of financial asset and financial liability are disclosed in note 1.
The Group holds the following financial assets and liabilities:
GROUP
20192018
$$
$
Restated
$
Restated

Amortised costs
Other
amortised cost
Loans and
receivables
Other
amortised cost
Financial assets
Cash and cash equivalents16,138,806-21,870,415-
Restricted bank account12,672,741-9,498,071-
Trade receivables6,519,453-8,251,355-
35,331,000-39,619,841-
Financial liabilities
Borrowings-34,638,696-26,483,359
Employee Entitlements-1,338,026-1,147,462
Contract liabilities-9,967,42310,173,952
Lease liabilities-7,029,3092,065,714
Trade and other payables-6,111,430- 4,859,124
Payables to NZTA and ODOT-12,488,871-9,439,139
-71,573,755-54,168,750
(a) Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual
obligations, and it arises principally from the Group’s trade receivables from customers in the normal course of business.
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The creditworthiness of
a customer or counterparty is determined by a number of qualitative and quantitative factors. Qualitative factors include external
credit ratings (where available), payment history and strategic importance of customer or counterparty. Quantitative factors include
transaction size, net assets of customer or counterparty, and ratio analysis on liquidity, cash flow and profitability.
In relation to trade receivables, it is the Group’s policy that all customers who wish to trade on terms are subject to credit verification
on an ongoing basis with the intention of minimising bad debts. The nature of the Group’s trade receivables is represented by regular
turnover of product and billing of customers based on the Group’s contractual payment terms. In North America, the Group requires
that customers under a certain fleet size to purchase the hardware with an upfront payment regardless of credit verification.
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and other
receivables. The main components of this allowance are a specific loss component that relates to individually significant exposures, and
a collective loss component established for Groups of similar assets in respect of losses that have been incurred but not yet identified.
The carrying amount of the Group’s financial assets represents the maximum credit exposure as summarised above.
Refer to note 13 for an aging profile for the Group’s trade receivables at reporting date.
(b) Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as and when they become due and payable.
The Group’s approach to managing liquidity risk is to ensure, as far as possible, that it will always have sufficient liquidity to meet its
liabilities when they become due and payable, under both normal and stressed conditions, without incurring unacceptable losses or
risking damage to the Group’s reputation.
The Group ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 90 days, including the
servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted,
such as natural disasters.
Maturities of financial liabilities
The following table details the Group’s contractual maturities of financial liabilities, including estimated interest payments and
excluding the impact of netting agreements, as at the reporting date.
Refer to note 15 for the maturity profile.
GROUP
2019
1 year or less
Over 1 to 5
years
Over 5
years
Total contractual
cash flows
Carrying amount of
liabilities
$$$$
Non-derivative financial liabilities
Borrowings17,236,91617,476,029-34,712,94534,638,696
Employee Entitlements1,338,026--1,338,0261,338,026
Lease liabilities782,4506,246,8597,029,3097,029,309
Trade and other payables6,111,430--6,111,4306,111,430
Payable to NZTA & ODOT12,488,871--12,488,87112,488,871
3 7, 9 57, 6 9 323,722,888-61,680,58161,606,332
NOTE 20 • FINANCIAL RISK MANAGEMENT (CONTINUED)
NOTE 19 • CONTRACT LIABILITIES (CONTINUED)
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
9899
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
GROUP
2018
1 year or less
Over 1 to 5
years
Over 5
years
Total contractual
cash flows
Carrying amount of
liabilities
$
Restated
$
Restated
$
Restated
$
Restated
$
Restated
Non-derivative financial liabilities
Borrowings10,808,99315,908,670-26,717,66326,483,359
Employee Entitlements1,147,462--1,147,4621,147,462
Lease liabilities801,0241,264,690-2,065,7142,065,714
Trade and other payables4,859,124--4,859,1244,859,124
Payable to NZTA & ODOT9,439,139--9,439,1399,439,139
27,055,74217,173,360-44,229,10243,994,798
Whilst each drawdown has a maximum 365 day term, the Company has the ability to re-draw amounts until the end of the term of the
facility, as a result the loan has been classified as non-current and prior year comparatives have been restated to align with the current
year presentation.
(c) Market risk
Market risk is the risk that changes in market prices, such as commodity prices, foreign exchange rates and interest rates, will affect the
Group’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control
market risk exposures within acceptable parameters, while optimising the return on risk.
Foreign currency risk
The Group is exposed to currency risk on sales transactions that are denominated in a currency other than the respective functional
currencies of Group entities, primarily the US Dollars (USD) and Australian Dollar (AUD). The Group, may on occasion, enter into
forward exchange contracts to hedge the exposure to foreign currency fluctuations on sales receipts.
The Group reports in New Zealand dollars. Movements in foreign currency exchange rates affect reported financial results, financial
position and cash flows. Where practical, the Group attempts to reduce this risk by matching revenues and expenditures, as well as
assets and liabilities, by country and by currency.
Foreign exchange rates applied against the New Zealand Dollar, at 31 March are as follows:
20192018
$$
AUD 1
0.950.94
USD 10.680.72
The Group’s exposure to foreign currency risk at the reporting date was as follows (all amounts are denominated in New Zealand Dollars):
2019AUDUSD
$$
Cash and cash equivalents
77,1311,928,808
Trade receivables119,9982,009,891
Lease liabilities-804,191
Borrowings-20,965,149
2018AUDUSD
$
Restated
$
Restated
Cash and cash equivalents
7,8661,122,704
Trade receivables111,7801,909,317
Lease liabilities-979,593
Borrowings-6,259,362
NOTE 20 • FINANCIAL RISK MANAGEMENT (CONTINUED)NOTE 20 • FINANCIAL RISK MANAGEMENT (CONTINUED)
Interest rate risk
At the reporting date the interest rate profile of the Group’s interest-bearing financial instruments was:
GROUP
%
2019
Carrying
amount%
2018
Carrying
amount
$$$
Term Loans - NZ $ denominated5.00%7,648,8605.12%16,873,678
Term Loans - US $ denominated5.55%18,716,5444.93%4,201,574
NZ Growth - Committed Cash Advance Facility 4.47%6,098,9364.29%3,584,623
US Growth - Committed Cash Advance Facility 4.98%2,248,6053.99%2,057,788
Net exposure to interest rate risk34,712,94526,717,663
Summarised sensitivity analysis
The following table summarises the sensitivity of the Group’s financial assets and financial liabilities to foreign currency risk and interest
rate risk.
GROUP
2019
-10%+10%-100bps+100bps
Profit
$
Equity
$
Profit
$
Equity
$
Profit
$
Equity
$
Profit
$
Equity
$
Cash and cash equivalents(138,486)(138,486)138,486138,486(161,388)(161,388)161,388161,388
Trade receivables(148,072)(148,072)148,072148,072----
Borrowings(1,425,630)(1,425,630)1,425,6301,425,630347,129347,129(347,129)(347,129)
Total increase/ (decrease)(1,712,188)(1,712,188)1,712,1881,712,188185,742185,742(185,742)(185,74 2)
GROUP
2018
-10%+10%-100bps+100bps
Profit
$
Restated
Equity
$
Restated
Profit
$
Restated
Equity
$
Restated
Profit
$
Equity
$
Profit
$
Equity
$
Cash and cash equivalents(81,574)(81,574)81,57481,574(218,704)(218,704)218,704218,704
Trade receivables(147,978)(147,978)1 47, 97 81 47, 97 8----
Borrowings(450,674)(450,674)450,674450,674267,177267,177(267,177)(267,177)
Total increase/ (decrease)(680,226)(680,226)680,226680,22648,47348,473(48,473)(48,473)
(1)
The foreign currency sensitivity above represents a 10% decrease and increase in spot foreign exchange rates.
(2)
The interest rate sensitivity above represents a 100 basis point (bps) decrease and increase in variable interest rates.
(d) Capital management
The Group’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future
development of the business. The Board monitors the return on capital employed, which the Group defines as reported EBIT (Earnings
Before Interest and Tax) divided by capital employed.
(e) Fair value measurement
The carrying amounts of the Groups financial assets and liabilities approximate their fair value due to their short maturity periods or fixed
rate nature.
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

EROAD
ANNUAL REPORT 2019
EROAD
ANNUAL REPORT 2019
100101
FINANCIAL STATEMENTSFINANCIAL STATEMENTS
NOTE 21 • SHARE-BASED PAYMENTS
At 31 March 2019, the Group had the following share-based payment arrangements.
EROAD LTI Plan (equity-settled)
Eligible employees were invited to purchase EROAD shares under the EROAD LTI plan. Under the terms of the scheme the purchase of
the shares is funded by a loan granted to the eligible employees by EROAD Limited. At the end of the vesting period the employee will
be paid a net bonus in relation to the shares that vest to the employee, equal to the amount of their loan outstanding to the Company,
enabling the loan to be repaid.
Shares issued under the scheme are held in trust for the employees during a 3 year restrictive period. If the employee ceases to be an
employee during the restrictive period the Trustees will repurchase the employees shares at the original issue price.
The eligible employees must meet certain performance conditions during each year of the restrictive period, as determined by the
remuneration committee and approved by the board. 50% of the scheme shares initially granted will be forfeited for each year the
participant fails to achieve their performance conditions. Additionally the employee’s shares will also be forfeited if the enterprise value of
the Company has not doubled by the end of the restrictive period.
Employee’s shares that are forfeited due to failure to meet market and non-market performance conditions will be repurchased by the
Trustee at the original grant date price.
The EROAD LTI Plan has been accounted for as grant of shares to employees in accordance with NZ IFRS 2. The key terms and conditions
relating to the grants under this Scheme are disclosed in the table below.
EROAD US President Incentive Scheme
The US President was invited to purchase EROAD shares under the EROAD US President Incentive Scheme. Under the terms of the
scheme the purchase of the shares is funded by a loan granted to the employee by EROAD Limited. At the end of the vesting period the
employee will be paid a net bonus in relation to the shares that vest to the employee, equal to the amount of their loan outstanding to the
Company, enabling the loan to be repaid.
Shares issued under the scheme are held in trust for the employee during a 3 year restrictive period. If the employee ceases to be an
employee during the restrictive period the Trustees will repurchase the employees shares at the original issue price.
Key operational measures and targets for the North American business are outlined in the employees grant letter, these include Total
Contract Units, Average Revenue Per Unit, Customer Acquisition Cost Payback Period, and Renewal Rate targets. Each operational
measure has a percentage weighting for each of the three-year periods, with the performance for each year being calculated based on
the percentage of target achieved multiplied by the percentage weighting for each operational measures. The total percentage of shares
to vest at the end of the restrictive period is calculated based on the average percentage performance over the three years. If the total
average performance is less than 60% then all shares granted under the scheme will be forfeited.
Employee’s shares that are forfeited due to failure to meet the non-market performance conditions will be repurchased by the Trustee at
the original grant date price.
The EROAD US President Incentive Scheme has been accounted for as grant of shares to employees in accordance with NZ IFRS 2. The
key terms and conditions relating to the grants under this Scheme are disclosed in the table below.
EROAD’s LTI Plan II (equity-settled)
Eligible employees were invited to purchase EROAD shares under the EROAD LTI plan. Under the terms of the scheme the purchase of
the shares is funded by a loan granted to the eligible employees by EROAD Limited. At the end of the vesting period the employee will
be paid a net bonus in relation to the shares that vest to the employee, equal to the amount of their loan outstanding to the Company,
enabling the loan to be repaid.
Shares issued under the scheme are held in trust for the employees during a 3 year restrictive period. If the employee ceases to be an
employee during the restrictive period the Trustees will repurchase the employees shares at the original issue price. For the shares to vest
the Company’s Total Shareholder Return (TSR) must exceed the median TSR of the NZX50 Group over the Relevant Assessment Period,
with a progressive vesting scale for performance between 50th and 75th percentiles, and 100% vesting if company performance is equal
to or above the 75th percentile of the NZX50 Group.
Employee’s shares that are forfeited due to failure to meet market and non-market performance conditions will be repurchased by the
Trustee at the original grant date price.
The EROAD LTI Plan has been accounted for as grant of shares to employees in accordance with NZ IFRS 2. The key terms and conditions
relating to the grants under this Scheme are disclosed in the table below.
NOTE 21 • SHARE-BASED PAYMENTS (CONTINUED)
Grant date/employees entitledVesting conditionsVesting period
Apr-17Sep-18
Shares granted to key
management personnel
EROAD LTI Plan II (FY18) - 197,890
• 3 years service from grant date
• Company’s Total Shareholder Return (TSR) must exceed
the median TSR of the NZX50 Group over the Relevant
Assessment Period (1 April 2017 to 1 April 2021).
• progressive vesting scale for performance between 50th and
75th percentiles, and 100% vesting if company performance
is equal to or above the 75th percentile of the NZX50 Group.2.5 years
EROAD LTI Plan II (FY19) - 85,276
• 3 years service from grant date
• Company’s Total Shareholder Return (TSR) must exceed
the median TSR of the NZX50 Group over the Relevant
Assessment Period (1 April 2018 to 1 April 2021).
• progressive vesting scale for performance between 50th and
75th percentiles, and 100% vesting if company performance
is equal to or above the 75th percentile of the NZX50 Group.
2.5 years
EROAD US President Incentive
Scheme
490,000 -
• 3 years service from grant date
• Meet minimum targets for key operational metrics: Total
Contracted Units, Average Revenue per Unit, Cost of
Customer Acquisition Payback and Renewal Rates.
• Each years performance is measured on a weighted
calculation of percentage achieved vs. target for operational
metrics.
• The percentage of shares to vest is calculated based on the
average of each years weighted percentage achieved. If the
vested amount is less than 60% all shares will be forfeited.
3 years
Shares granted to other
employees
EROAD LTI Plan II (FY18) - 8 7, 9 9 5
• 3 years service from grant date
• Company’s Total Shareholder Return (TSR) must exceed
the median TSR of the NZX50 Group over the Relevant
Assessment Period (1 April 2017 to 1 April 2021).
• progressive vesting scale for performance between 50th and
75th percentiles, and 100% vesting if company performance is
equal to or above the 75th percentile of the NZX50 Group. 2.5 years
EROAD LTI Plan II (FY19) - 25,977
• 3 years service from grant date
• Company’s Total Shareholder Return (TSR) must exceed
the median TSR of the NZX50 Group over the Relevant
Assessment Period (1 April 2018 to 1 April 2021).
• progressive vesting scale for performance between 50th and
75th percentiles, and 100% vesting if company performance is
equal to or above the 75th percentile of the NZX50 Group.2.5 years
490,000 397,138
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS