Enprise accounting records – FMA

11 August 2023
Enprise accounting records
Enprise Group Limited (NZX: ENS) (“Enprise”) notes that the Financial Market Authority (“FMA”) has issued
Enprise a warning under section 9 of the Financial Markets Authority Act 2011.
FMA considered Enprise had not maintained sufficient evidence to support the directors’ judgments in
accounting for the recoverable amount of cash generating unit Kilimanjaro Consulting – Australia, and its
recognised deferred tax assets, as recorded in the group financial statements for the year ended 30 June
2022.
Enprise is disappointed and remorseful that FMA reached this conclusion, and accepts the FMA’s decision
to issue a warning. We are taking up FMA’s offer to discuss how Enprise can further improve its practices.
The judgments Enprise’s Board needed to make when finalising Emprise’s 2022 group financial statements
were challenging, as subsequent to balance date Kilimanjaro had disputed MYOB’s unilateral attempt to
retrospectively reduce margins that Kilimanjaro receives on existing sales of MYOB Exo software. Enprise
had signalled these difficulties in an announcement to NZX on 29 September 2022 before it finalised the
group financial statements on 6 October 2022.
In December 2022 Kilimanjaro filed legal proceedings against MYOB. On 7 August 2023 Enprise
announced Kilimanjaro was granted an interlocutory injunction against MYOB restoring the MYOB margins,
pending a full trial scheduled in 2024.
In October 2022 FMA commenced public consultation on draft guidance on its expectations for accounting
records. In February 2023 FMA finalised and published FMA’s ‘Guidance and Expectations for Keeping
Proper Accounting Records’. Enprise welcomes the additional information contained in that guidance.
As acknowledged by the FMA in its warning, Enprise has already taken positive steps to improve its financial
reporting functions in recent months, such as:
• restructuring the Board’s Audit and Risk Committee which is now chaired by a non-executive
director;
• reviewing the staffing structures with a view to ensuring the financial accounting function is
appropriately staffed; and
• engaging with external consultants to provide and implement recommendations to improve the
financial reporting process.

Nick Paul
Chairperson, Enprise Group Limited
0274980051

ENDS