HALF YEARLY REPORT. 31 December Clarence Property Corporation Limited

HALF YEARLY REPORT 31 December 2017 Clarence Property Corporation Limited ACN 094 710 942, AFSL 230212 As Responsible Entity for Westlawn Property Trust ARSN 095 611 804

FINANCIAL REPORT CONTENTS PAGE Directors' report 2 Auditors' Independence Declaration 8 statement of profit or loss and other comprehensive income 9 statement of financial position 10 statement of changes in equity 11 statement of cash flows 12 Notes to the financial statements 13 Directors' declaration 35 Auditors' Report 36 DIRECTORY Responsible Entity and Manager Auditor for the Trust Clarence Property Corporation Limited WCA Audit & Assurance Services Pty Ltd ACN 094 710 942 62 Woodlark Street AFSL 230212 Lismore NSW 2480 Registered Office Solicitors 2/75 Tamar Street McCullough Robertson Ballina NSW 2478 Level 11, Central Plaza Two Phone: 02 6686 4122 66 Eagle Street Fax : 02 6686 5122 Brisbane QLD 4000 Email: enquiry@clarenceproperty.com.au Auditor for the Manager Registry WCA Audit & Assurance Services Pty Ltd PO Box 1478 62 Woodlark Street Ballina NSW 2478 Lismore NSW 2480 Page 1

DIRECTORS' REPORT The directors of Clarence Property Corporation Ltd ("Responsible Entity"), the responsible entity of Westlawn Property Trust (the "Trust"), submit these statements in accordance with a resolution of the directors with respect to the results of the Trust for the half year ended 31 December 2017 (the reporting period) and the state of the Trust's affairs at that date. 1 Directors and officers i) Directors The following persons were directors of the Responsible Entity during the reporting period and up to the date of this report, unless otherwise stated: Jim Dougherty Chairman of Directors (Non- Executive) Age 64 years Jim is a licensed real estate agent and chartered accountant with wide ranging experience in the property, accounting and finance industries. He holds a Bachelor of Economics and a Diploma of Financial Management, both from the University of New England, and also holds a Certificate IV in Financial Sevices (Finance/Mortgage Broking). He was awarded the Order of Australia Medal in 2014 for services to the community and surf lifesaving. He has been an executive director of Westlawn Finance Limited since 1994 and has been chairman of directors of Clarence Property Corporation Limited since 2000. Peter Fahey Managing Director (Executive) Age 54 years Peter has been involved in the property industry for more than 30 years, commencing as a valuer with the State Bank of NSW, working across various locations in NSW assessing security properties for the banks credit. Following this were roles in commercial property sales, leasing and management at LJ Hooker Grafton. He became involved in funds management in 1994 as the founder of Westlawn Property Trust, and subsequently numerous other syndicates. He has been managing director of Clarence Property Corporation Limited since 2000. Geoff Shepherd Director (Non-Executive) Age 69 years Geoff has 34 years experience in public accounting and auditing, and is a former partner of Grafton based firm Hudson Shepherd Pty Ltd. He is a Fellow of the Institute of Chartered Accountants in Australia. Geoff has over 20 years experience in Funds Management and Property Investment, and has been an adviser to or director of Clarence Property Corporation Limited throughout that time. He is Chairman of Clarence Village Limited, an aged care accommodation and service provider in the Clarence Valley. Tony Tippett Director (Non-Executive) Age 54 years Tony has been actively involved in the property industry for the last 27 years, from project conception, feasibility, financing, marketing, to sales and delivery for a range of residential, commercial and retail projects up to $350 million. He is a director of the Robina Group of Companies, an associate member of the Institute of Chartered Accountants in Australia, a fellow of the Governance Institute of Australia, a member of the Australian Institute of Company Directors, a licenced Real Estate Agent and holds a Bachelor of Economics from the University of New England. Page 2

DIRECTORS' REPORT 1 Directors and officers (continued) ii) Company Secretary Paul James Rippon Age 60 years Paul has been involved in the property and funds management industry for the past 10 years, and prior to that had a 31 year career in public accounting. He holds a Bachelor of Business in Accounting & Business Law from the New South Wales Institute of Technology. Paul is a member of the Institute of Chartered Accountants in Australia. iii) Directors meetings Six directors meetings were held in the period 1 July 2017 to 31 December 2017 and attendances were: James William Dougherty 6 Peter Nicholas Fahey 6 Geoffrey Rex Shepherd 6 Anthony John Tippett 4 2 Principal activity The principal activity of the Trust during the reporting period was to offer individual investors the opportunity to combine their funds with the funds of other investors to collectively, within the Trust, invest in income producing commercial, retail and industrial property. There was no significant change in the nature of this activity during this period, other than as stated in these statements. 3 Review of operations The following is a summary of key outcomes during the reporting period: i) Operating results The comprehensive income of the Trust after income tax for the reporting period amounted to $3,399,640 (December 2016: $6,469,230). ii) Property acquisitions In August 2017 the Trust settled the purchase of a logistics and distribution complex at 48 Bell-Are Avenue, Northgate in Brisbane for $8,475,000. The purchase was funded from existing undrawn finance facilities. In September 2017 the Trust settled the purchase of a commercial office building at 201 Leichhardt St, Spring Hill in Brisbane for $14,272,562. The purchase was funded from a new finance facility with ING using the Murarrie, Varsity Lakes and Northgate properties as security. In December 2017 the Trust acquired a commercial office building at 9 Hercules St, Hamilton in Brisbane for $11,983,594. The purchase was funded from existing undrawn finance facilities and a new finance facility with ING using the Spring Hill property as security. Page 3

DIRECTORS' REPORT 3 Review of operations (continued) iii) Property sales In November 2017, the Trust entered into a contract for the sale of its residential property located at 12 Casurina Close, Yamba for $378,000. The sale settled on 20 December 2017, with the net proceeds being used to reduce borrowings. iv) Investment property revaluations No properties were independently valued during the period. v) Property development During the period the Trust continued the development of "Epiq" Lennox. i) Stage 1B gained practical completion during December 2017, with the Sub-Division Certificate obtained from Council in February 2018; ii) Stage 2 civil works are nearing completion, with settlement of the 82 unconditionally exchanged contracts expected by mid-2018; iii) Stage 3 construction certificate was obtained in September 2017, and the 14 month civil works program has commenced; iv) Stage 4 development approval was received in September 2017 with construction certificate approval received in January 2018. The 6 months civil works program is expected to commence in April 2018. 15 lots have been released to the market for sale with 6 lots so far exchanged under unconditional contracts; v) Stage 5 development application was submitted to Council in October 2017; and vi) The shopping centre development application was submitted to Council in August 2017. A construction certificate for the bulk earth works was obtained in November 2017, with that 6 months civil works program well under way. vi) Other investments The Trust continues to hold 1,425,000 units in the Robina Quays Unit Trust. vii) Capital raising The capital raising pursuant to the PDS No.5 dated 9 December 2015 was closed on 11 August 2017. Approximately $33.8 million was raised. On 1 December 2017, the Trust issued a PDS No. 6. At the date of this report $2,415,684 had been raised. Pursuant to the Distribution Reinvestment Plan, 1,202,517 units were issued during the period (1,019,326 at $0.72 per unit and 183,191 at $0.79 per unit). Page 4

DIRECTORS' REPORT 3 Review of operations (continued) 4 Significant changes in the state of affairs of the Trust In the opinion of the Directors there were no significant changes in the state of affairs of the Trust during the period 5 Matters arising since the period end Property acquisition A contract for the purchase of a large format retail property at 1-17 Compton Road, Underwood in Brisbane (known as "The Zone, Underwood") was signed in December 2017 for $31,250,000. Settlement is due to take place during April 2018. The purchase is expected to be funded by a new finance facility secured by the property itself and the currently unencumbered Hamilton property, together with proceeds from the current capital raising. No matter or circumstance, other than as mentioned above, has arisen since the end of the reporting period that has significantly affected or may significantly affect: i) the operations of the Trust; ii) the results of those operations; or iii) the state of affairs of the Trust in subsequent financial years. 6 Likely developments in the operations of the Trust The Trust will continue with a similar level of activity for the year ending 30 June 2018 as in the past. The Manager will continue to ensure the long term growth of the Trust by identifying profitable long term property opportunities in Australia, and will continue to carefully manage existing properties. 7 Environmental issues The Trust's operations are not subject to any particular or significant environmental regulation under a law of the Commonwealth, State or Territory. The Trust is, however, a party to a Conservation Zone Management Plan relating to its "Epiq" Lennox development 8 Distributions to fund members During the half year ended 31 December 2017 fund members received or were entitled to receive cash distributions of $5,326,431 (2016: $4,158,354). The average annualised rate of normal cash distributions for the financial period was 6.5 cents per unit (2016: 6.5 cents per unit). 9 Options on units There are no options over any units in the Trust. Page 5

DIRECTORS' REPORT 10 Responsible Entity fees The Responsible Entity has been paid or is due fees of $1,739,992 for the half year ended 31 December 2017 (December 2016: $1,297,453) in accordance with the Constitution of the Trust. Further details of fees paid to the manager are disclosed in Note 25 on Page 30 of the financial statements. 11 Indemnifying officers or auditor During or since the end of the reporting period the Responsible Entity has not given an indemnity or entered an agreement to indemnify any officer or auditor in respect of the operations of the Trust. The Responsible Entity pays premiums to insure each of the directors against liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of their conduct while acting in the capacity of director of the Responsible Entity, other than conduct involving a wilful breach of duty in relation to the Responsible Entity. 12 Interests in the Trust The details of the Trust for the half year ended 31 December 2017 were: i) Units as at 1 July 2017 153,478,307 Units issued during the period 13,539,137 Units redeemed during the period - Units as at 31 December 2017 167,017,444 ii) During the reporting period the Responsible Entity acquired 25,089 units through the Distribution Reinvestment Plan. The Responsible Entity holds 583,088 units as at 31 December 2017. iii) The value of the Trust's assets at 31 December 2017 was $261,469,968. Assets were valued at cost or fair value. 13 Proceedings on behalf of the Trust No person has applied for leave of Court to bring proceedings on behalf of the Trust or intervene in any proceedings to which the Trust is a party for the purpose of taking responsibility on behalf of the Trust for all or any part of those proceedings. The Responsible Entity was not a party to any such proceedings during the period. Page 6

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 31 December 31 December Note 2017 2016 $ $ Revenue and other income Interest revenue 10,719 29,535 Property revenue 9,113,325 8,311,259 Sale of inventories - 11,434,025 Profit on disposal of assets 44,695 - Other income 2 7,676 - Fair value gain from investment property 12 2,500,374 1,709,026 Fair value gain on derivative financial instruments 489,584 1,643,102 Total revenue 12,166,373 23,126,947 Expenses Financing costs 3 (1,983,142) (2,354,356) Property expenses and outgoings (3,399,137) (2,609,825) Bad and doubtful debts expense 2,196 (4,322) Inventory sales costs (287,800) (676,464) Cost of inventories sold - (7,527,517) Responsible entity fees 25 (669,150) (561,959) Other expenses (989,650) (150,747) Total expenses (7,326,683) (13,885,190) Net profit before income tax expense 4,839,690 9,241,757 Income tax expense 5 (1,440,050) (2,772,527) Profit after income tax expense attributable to unitholders 3,399,640 6,469,230 Other comprehensive income - - Total comprehensive income attributable to unitholders 3,399,640 6,469,230 The above statement of profit or loss and other comprehensive income should be read in conjuction with the accompanying notes. Page 9

STATEMENT OF FINANCIAL POSITION As at 31 December 2017 ASSETS 31 December 30 June Note 2017 2017 $ $ Current assets Cash and cash equivalents 6 3,061,319 8,040,203 Trade and other receivables 7 286,853 186,924 Inventory 9 36,758,076 29,763,586 Other assets 11 1,539,244 1,160,372 Total current assets 41,645,492 39,151,085 Non-current assets Financial assets 8 1,425,000 1,425,000 Investment property 12 214,953,298 173,978,898 Deferred tax assets 10 3,376,218 4,035,137 Other assets 11 69,960 4,866 Total non-current assets 219,824,476 179,443,901 Total assets 261,469,968 218,594,986 LIABILITIES Current liabilities Trade and other payables 13 2,026,827 1,451,767 Income tax 14 101,743 - Other liabilities 15 2,459,445 8,122,950 Financial liabilities 17 19,815,000 4,195,309 Total current liabilities 24,403,015 13,770,026 Non-current liabilities Deferred tax liabilities 16 12,787,905 12,108,517 Other liabilities 15 - - Financial liabilities 17 93,586,197 70,231,783 Derivative financial instruments 18 1,869,053 2,358,637 Total non-current liabilities 108,243,155 84,698,937 Total liabilities 132,646,170 98,468,963 Net assets 128,823,798 120,126,023 EQUITY Unitholders' equity Issued capital 154,871,858 144,247,292 Undistributed income (26,048,060) (24,121,269) Total unitholders' equity 128,823,798 120,126,023 The above statement of financial position should be read in conjuction with the accompanying notes. Page 10

STATEMENT OF CHANGES IN EQUITY No. of units on issue Undistributed Issued capital income Total $ $ $ Balance at 1 July 2017 153,478,307 144,247,292 (24,121,269) 120,126,023 Total comprehensive profit attributable to unitholders - - 3,399,640 3,399,640 153,478,307 144,247,292 (20,721,629) 123,525,663 Transactions with unitholders recorded directly in equity: Distributions paid/payable - - (5,326,431) (5,326,431) Units issued 13,539,137 10,624,566-10,624,566 Units redeemed - - - - Balance at 31 December 2017 167,017,444 154,871,858 (26,048,060) 128,823,798 No. of units on issue Undistributed Issued capital income Total $ $ $ Balance at 1 July 2016 125,134,632 121,974,060 (32,806,084) 89,167,976 Total comprehensive profit attributable to unitholders - - 6,469,230 6,469,230 125,134,632 121,974,060 (26,336,854) 95,637,206 Transactions with unitholders recorded directly in equity: Distributions paid/payable - - (4,158,354) (4,158,354) Units issued 10,132,553 7,811,815-7,811,815 Units redeemed - - - - Balance at 31 December 2016 135,267,185 129,785,875 (30,495,208) 99,290,667 The above statement of changes in equity should be read in conjuction with the accompanying notes. Page 11

STATEMENT OF CASH FLOWS 31 December 31 December Note 2017 2016 $ $ Cash flows from operating activities Receipts from operations (including GST) 4,388,417 10,787,450 Interest received 10,719 29,535 Trust distributions received 7,676 - Proceeds on sale of inventories - 11,434,025 Payment to suppliers (6,366,906) (4,985,132) Payment for inventory (6,994,490) (3,971,822) Goods & services tax received (paid) 115,490 (773,764) Borrowing costs paid (2,159,388) (2,269,016) Income taxes received (paid) 174,665 - Net cash provided by/(used in) operating activities 23 (10,823,817) 10,251,276 Cash flows from investing activities Proceeds from sale of non-current assets 310,560 - Payment for property (38,737,867) (12,350,732) Net cash used in investing activities (38,427,307) (12,350,732) Cash flows from financing activities Proceeds from issue of units 10,624,566 7,811,816 Proceeds from borrowings 52,596,031 16,350,412 Repayment of borrowings (13,621,926) (17,469,299) Distribution paid (5,326,431) (4,158,355) Net cash provided by financing activities 44,272,240 2,534,574 Net increase (decrease) in cash held (4,978,884) 435,118 Cash at beginning of financial year 8,040,203 1,215,571 Cash at the end of the financial period 6, 23 3,061,319 1,650,689 The above statement of cash flows should be read in conjuction with the accompanying notes. Page 12

1 Summary of significant accounting policies The financial statements cover Westlawn Property Trust (the "Trust") as an individual entity. The Trust is a registered managed investment scheme in accordance with the Corporations Act 2001 and is domiciled in Australia. Basis of preparation The financial statements are general purpose financial statements prepared in accordance with Australian Accounting Standards (including Australian Accounting Interpretations) of the Australian Accounting Standards Board. Australian Accounting Standards set out accounting policies the AASB has concluded would result in financial statements containing relevant and reliable information about transactions, events and conditions. Compliance with Australian Accounting Standards ensures the financial statements and notes also comply with International Financial Reporting Standards. Material accounting policies adopted in the preparation of the financial statements are presented below and have been consistently applied unless otherwise stated. The financial statements have been prepared on an accruals basis and are based on historical costs modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities. The financial statements are presented in Australian dollars which is the Trust's functional and presentational currency. Statement of compliance A number of new standards, amendments to standards and interpretations are available for early adoption but have not been applied in preparing these financial statements. The potential impact of the new standards, amendments to standards and interpretations has been considered and they are not expected to have a significant effect on the financial statements. a) Investment property Investment property comprises investment interests in land and buildings (including integral plant and equipment) held for the purpose of letting to produce rental income or for capital appreciation or both. Initially, investment property is measured at cost including transaction costs. Subsequent to initial recognition, investment property is then stated at fair value at each balance date with any gain or loss arising from a change in fair value of investment property recognised in the statement of profit or loss and other comprehensive income in the period in which it arises. Fair values are based on market values, being the estimated amount for which a property could be exchanged on the date of valuation between a willing buyer and a willing seller in an arm's length transaction after proper marketing wherein the parties have each acted knowledgeably, prudently and without compulsion. External independent valuations are commissioned at least once every three years or when the directors are of the opinion there has been a material movement in the market. Internal valuations are also undertaken by suitably experienced and qualified appraisers for those properties not externally valued at each balance date. The reported fair value of investment property reflects market conditions at the end of the reporting period. While this represents the best estimate as at the reporting date, actual sale prices achieved may be higher or lower than the most recent valuation. This is particularly relevant in periods of market illiquidity or uncertainty. Land & Buildings (including integral plant and equipment) which comprise the investment property are not depreciated. The carrying amount of investment properties includes components relating to lease incentives, leasing costs and receivables on rental income that have been recorded on a straight line basis Page 13

1 Summary of significant accounting policies (continued) a) Investment property (continued) Transfers are made from investment property to inventories when, and only when, there is a change in use as evidenced by commencement of development with a view to sale. When an investment property is disposed of without development, it continues to be treated as an investment property until it is derecognised and does not treat it as inventory. Investment property is derecognised when disposed of or when the investment property is permanently withdrawn from use and no future benefit is expected from its disposal. Any gain or loss on derecognition of an investment property is recognised in the statement of profit or loss and other comprehensive income in the period of Investment property also includes property under construction for future use as investment property. These are carried at fair value, or at cost where fair value cannot be reliably determined and the construction is incomplete. b) Operating leases - investment property The minimum rental revenue of operating leases with fixed rental increases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, is recognised on a straight-line basis. Revenue from other leases is recognised in accordance with the lease agreement, which is considered to best represent the pattern of service rendered through the provision of the leased asset. Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses on a straight-line basis over the lease term. Lease incentives under operating leases may take the form of cash, rent-free periods, contributions to certain lessee costs, relocation costs and lessee or lessor owned fit-outs and improvements. These incentives are capitalised as part of the carrying value of the investment property and amortised on a straight-line basis over the term of the lease as a reduction of rental income. The carrying amount of the lease incentives is reflected in the fair value of investment property. c) Inventories Where a property or asset is acquired for the purpose of undergoing redevelopment and subsequent resale or is in the process of production for such sale, it is treated as inventories. Inventories is stated at the lower of cost and net realisable value. Cost includes acquisition, development and holding costs such as borrowing costs, rates and taxes. Holding costs incurred after the completion of the development are expensed. Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and selling expenses. Transfers are made from inventories to investment property when, and only when, there is a change in use evidenced by commencement of an operating lease to another party. For a transfer from inventories to investment property, any difference between the fair value of the property at that date and its previous carrying amount is recognised in the statement of profit or loss and other comprehensive income in the period in which the transfer Page 14

1 Summary of significant accounting policies (continued) d) Financial assets and liabilities Initial recognition and measurement Financial assets and financial liabilities are recognised when the Trust becomes a party to the contractual provisions to the instrument. For financial assets, this is equivalent to the date the Trust commits itself to either purchase or sell the asset (i.e. trade date accounting is adopted). Financial instruments are initially measured at fair value plus transaction costs except where the instrument is classified at fair value through profit or loss in which case transaction costs are expensed to the statement of profit or loss and other comprehensive income immediately. Classification and subsequent measurement Financial instruments are subsequently measured at either fair value, amortised cost using the effective interest rate method or cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, between knowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair value. In other circumstances, valuation techniques are adopted. Amortised cost is calculated as: - the amount at which the financial asset or financial liability is measured at initial recognition; - less principal repayments; - plus or minus the cumulative amortisation of the difference, if any, between the amount initially recognised and the maturity amount calculated using the effective interest rate method; and - less any reduction for impairment. The effective interest rate method is used to allocate interest income or interest expense over the relevant period and is equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees, transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying value with a consequential recognition of an income or expense in the statement of profit or loss and other i) Financial assets at fair value through profit or loss Financial assets are classified at 'fair value through profit or loss' when they are either held for trading for the purpose of short-term profit taking, derivatives not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented risk management or investment strategy. Such assets are subsequently measured at fair value with changes in carrying value being included in the statement of profit or loss and other comprehensive income. ii) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost. Loans and receivables are included in current assets, except those which are not expected to mature within 12 months after the end of the reporting period, which are classified as non-current assets. iii) Financial liabilities Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost. Page 15

1 Summary of significant accounting policies (continued) d) Financial assets and liabilities (continued) Fair value Fair value is determined based on current bid price for all quoted investments. Valuation techniques are applied to determine the fair value for all unlisted securities including recent arm s length transactions, reference to similar instruments or option pricing models. Impairment At the end of each reporting period, the Trust assesses whether there is objective evidence that a financial instrument has been impaired. Impairment losses are recognised by transferring all valuation decrements recognised in equity relating to a particular investment to the statement of profit or loss and other comprehensive Derecognition Financial assets are derecognised where the contractual right to receipt of cash flows expires or the asset is transferred to another party whereby the Trust no longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised where the related obligations are either discharged, cancelled or expire. The difference between the carrying value of the financial liability extinguished or transferred to another party and the fair value of consideration paid, including the transfer of noncash assets or liabilities assumed, is recognised in the statement of profit or loss and other comprehensive e) Derivative financial instruments The Trust is exposed to changes in interest rates and enters into interest rate swap agreements to convert certain variable interest rate borrowings to fixed interest rates. The swaps are entered into with the objective of hedging the risk of adverse interest rate fluctuations. While the Manager has determined that these arrangements are economically effective, they have not satisfied the documentation, designation and effectiveness tests required by Australian Accounting Standards and therefore do not qualify for hedge accounting. Derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently remeasured to fair value at each reporting date. Gains or losses arising from changes in fair value are recognised immediately in the Statement of Comprehensive Income. Fair value at reporting date is calculated to be the present value of the estimated future cash flows of these instruments. The two key variables used in the valuation are the forward price curve and discount rates. Each instrument is discounted at the market interest rate appropriate to the instrument. Derivative financial instruments are classified as assets when their fair value is positive and as liabilities when their fair value is negative. f) Impairment of assets At the end of each reporting period, the Trust assesses whether there is any indication an asset may be impaired. The assessment includes considering external and internal sources of information. If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the asset (being the higher of the asset s fair value less costs to sell or value in use) to the asset s carrying value. Any excess of the asset s carrying value over its recoverable amount is expensed to the statement of profit or loss and other comprehensive Where it is not possible to estimate the recoverable amount of an individual asset, the Trust estimates the recoverable amount of the cash-generating unit to which the asset belongs. Page 16

1 Summary of significant accounting policies (continued) g) Provisions Provisions are recognised when the Trust has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured. Provisions are measured using the best estimate of the amounts required to settle the obligation at the end of the reporting period. h) Cash and cash equivalents Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities on the statement of financial position. i) Revenue and other income Interest revenue is recognised using the effective interest rate method, which for floating rate financial assets is the rate inherent in the instrument. Dividend & trust distribution revenue is recognised when the right to receive a dividend or trust distribution has been established. Investment property revenue is recognised on a straight-line basis over the period of the lease term so as to reflect a constant periodic rate of return on the net investment (refer to note 1b). j) Trade and other payables Trade and other payables represent the liability outstanding at the end of the reporting period for goods and services received by the Trust during the reporting period, which remain unpaid. The balance is recognised as a current liability with the amounts normally paid within 30 days of recognition of the liability. k) Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial period of time to prepare for their intended use or sale are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. Borrowing costs, except loan establishment costs, are recognised in the statement of profit or loss and other comprehensive income in the period in which they are incurred. Loan establishment costs are capitalised and amortised over the term of the facility to which they relate, or five years, whichever is shorter. Page 17

1 Summary of significant accounting policies (continued) l) Taxation i) Income Tax Under current Australian income tax legislation, the Trust is liable to income tax as it is classified as a Public Trading Trust. The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and unused tax losses and the adjustment recognised for prior periods, where applicable. Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for: - When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits; or - When the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures, and the timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. The carrying amount of recognised and unrecognised deferred tax assets are reviewed each reporting date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to recover the asset. Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities, and they relate to the same taxable authority on either the same taxable entity or different taxable entities which intend to settle simultaneously. ii) Goods and services tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except where the GST incurred on a purchase of goods and services is not recoverable from the Tax Office. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from or payable to the Tax Office is included as part of receivables or payables in the statement of financial position. Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from or payable to the Tax Office, is classified as operating cash flows. Page 18

1 Summary of significant accounting policies (continued) m) Critical accounting estimates and judgements The Responsible Entity evaluates estimates and judgements incorporated into the financial statements based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Trust. Key Estimates The Trust assesses impairment at the end of each reporting period by evaluation of conditions and events specific to the Trust that may be indicative of impairment triggers. Recoverable amounts of relevant assets are reassessed using value-in-use calculations, which incorporate various key assumptions. Key judgements Information about significant areas of estimation, uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amount recognised in the financial statements is described in the following note: Note 12 - Investment property. Page 19

31 December 31 December 2017 2016 2 Revenue and other income $ $ Other income comprises: Trust distributions 7,676-7,676-3 Profit Net profit before income tax expense has been determined after: Financing costs Interest expense 1,947,796 2,269,015 Borrowing costs 35,346 85,341 1,983,142 2,354,356 4 Auditors' remuneration Detail of remuneration of auditor is set out below: Auditing or reviewing the financial statements 33,380 21,330 33,380 21,330 5 Income tax expense Income tax expense Current tax 101,743 1,207,802 Adjustment recognised for prior periods (7,025) - Deferred tax expense/(income) 1,345,332 1,564,725 1,440,050 2,772,527 Numerical reconciliation of income tax expense and tax at the statutory rate Profit before income tax expense 4,839,690 9,241,757 Tax at the statutory tax rate of 30% 1,451,907 2,772,527 Tax effect amounts which are not deductible/(taxable) in calculating taxable income: Capital gain on disposal of assets (4,916) - Sundry items 84-1,447,075 2,772,527 Adjustment recognised for prior periods (7,025) - Income tax expense 1,440,050 2,772,527 Page 20

31 December 30 June 2017 2017 6 Cash and cash equivalents $ $ Security deposits 3,700 3,700 Cash held in trust 1,755,050 191,808 Cash at bank 1,302,569 7,844,695 3,061,319 8,040,203 7 Trade and other receivables Current Trade and other debtors 95,944 128,026 Less provision for doubtful debts - (2,416) GST receivable 190,909 61,314 Total trade and other receivables 286,853 186,924 Future minimum lease receivables Future minimum lease payments receivable from non-cancellable operating leases: Within one year 16,210,776 12,795,431 Later than one year but not later than five years 36,239,320 26,792,954 Later than five years 11,701,260 12,011,998 64,151,356 51,600,383 The Trust, as lessor, typically enters into operating leases with tenants for periods of 3 years to 10 years with option periods. The lease agreements provide for either rental increases as specified in the agreement or CPI increases. The movement in provision for doubtful debts during the period was as follows: Opening balance 2,416 14,498 Provision for doubtful receivables - 12,557 Receivables written off during the year - (21,139) Reversals of amounts provided (2,416) (3,500) Closing balance - 2,416 Page 21

31 December 30 June 2017 2017 8 Financial assets $ $ Non-current Financial assets at fair value through profit or loss Units in unlisted unit trusts 1,425,000 1,425,000 1,425,000 1,425,000 1,425,000 1,425,000 9 Inventory Current At cost Land held for resale 859,014 850,000 Land under development 36,129,062 29,143,586 36,988,076 29,993,586 At net realisable value Land held for resale (i) 629,014 620,000 Land under development (ii) 36,129,062 29,143,586 36,758,076 29,763,586 (i) The land at 9 Treelands Drive, Yamba was independently valued in September 2015 by Opteon Property Group at $620,000. (ii) Stage 2 of "Epiq" Lennox was independently valued in March 2017 by Taylor Byrne Valuations at $6,150,000. Since that date further development activity has been undertaken. The balance of the land was independently valued in September 2017 by Taylor Byrne Valuations at $34,350,000. The combined valuations total $40,500,000. Page 22

31 December 30 June 2017 2017 10 Deferred tax assets $ $ Deferred tax assets comprises temporary differences attributable to: Provision for doubtful debts - 725 Accrued expenses 8,964 14,955 Capital raising costs 69,216 68,366 Derivative financial instruments 560,716 707,591 Investment properties 2,737,322 3,243,500 Total deferred tax assets 3,376,218 4,035,137 11 Other assets Current Prepayments 649,921 390,070 Other assets 889,323 595,637 Prepaid income tax - 174,665 1,539,244 1,160,372 Non-current Prepayments 69,960 4,866 69,960 4,866 Total other assets 1,609,204 1,165,238 Page 23

Independent Valuation 31 December 30 June Amount Date Firm 2017 2017 12 Investment property $ $ $ Investment property (at fair value) Commercial 100 Blundell Boulevard, Tweed Heads 8,700,000 Oct-15 CB Richard Ellis 8,700,000 8,700,000 29 Molesworth Street, Lismore 16,400,000 Apr-17 CB Richard Ellis 16,000,000 16,400,000 The Rocket, Robina (Note 1) 35,025,000 Jul-15 Jones Lang Lasalle 35,025,000 35,025,000 183 Varsity Parade, Varsity Lakes 11,800,000 Feb-17 CB Richard Ellis 11,800,000 11,800,000 201 Leichhardt Street, Spring Hill (Note 2) 14,300,000 Nov-17 Savills 14,300,000-9 Hercules Street, Hamilton (Note 3) 11,983,594 Nov-17 Jones Lang Lasalle 12,000,000 - Retail Yamba Fair 32,500,000 Jun-17 Jones Lang Lasalle 32,500,000 32,500,000 Yamba residential properties (Note 4) 635,000 May-15 Taylor Byrne 635,000 945,000 Byron Fair 9,500,000 Oct-15 CB Richard Ellis 11,500,000 9,500,000 Easy T Shopping Centre, Robina 30,000,000 Oct-15 CB Richard Ellis 34,000,000 30,000,000 Tamar Village Shopping Centre, Ballina 3,200,000 Aug-15 Taylor Byrne 3,200,000 3,200,000 Proposed Yamba Fuel Station (Note 5) 1,050,000 Jan-16 Opteon Property Group 1,268,298 1,258,898 Bell Central Shopping Centre, Mudgeeraba 13,500,000 Aug-15 M3 Property 14,400,000 13,500,000 Logistics/Distribution 45 Alexandra Place, Murarrie 11,150,000 Mar-17 Jones Lang Lasalle 11,150,000 11,150,000 48 Bell-Are Avenue, Northgate (Note 6) 8,475,000 Jul-17 Jones Lang Lasalle 8,475,000-208,218,594 214,953,298 173,978,898 Note 1 - The amounts quoted represent the Trust's 50% ownership in the property. Note 2 - The property was acquired in September 2017. Note 3 - The property was acquired in December 2017. Note 4 - These properties adjoin the Trust's Yamba Fair property and are held for future development of the centre. One property was disposed in December 2017. Note 5 - The amounts represent acquisition and minor development planning costs relating to the purchase of two residential properties in February 2016 on which the Trust proposes to build a fuel station. Note 6 - The property was acquired in August 2017. Valuation basis The fair value model is applied to all investment property. External independent valuations are commissioned at least once every three years or when the directors are of the opinion there has been a material movement (particularly downwards) in the market. Internal valuations are undertaken by suitably experienced and qualified appraisers for those properties not externally valued at each balance date. Movement in investment properties Opening balance 173,978,898 159,000,678 Additions at cost Acquisition price 34,731,156 22,099,800 Transaction costs 3,171,376 1,843,275 Improvements 705,667 1,078,532 Disposals (312,500) (16,154,219) Net fair value adjustment 2,500,374 5,872,302 Lease incentives and leasing fees deferred 129,668 474,243 Amortisation of lease incentives and leasing fees (94,616) (178,588) Movement in straight-lining rental income asset 143,275 (57,125) Closing balance 214,953,298 173,978,898 Page 24

31 December 30 June 2017 2017 13 Trade and other payables $ $ Current Other creditors 2,026,827 1,451,767 2,026,827 1,451,767 Included in the above are amounts due to related parties: Other creditors 395,459-395,459-14 Income tax Current Provision for income tax 101,743-101,743-15 Other liabilities Current Rent received in advance 1,339,839 782,682 Units to be issued 506,621 6,888,235 Provision for rental guarantees - 46,635 Other liabilities 612,985 405,398 2,459,445 8,122,950 Non-Current Provision for rental guarantees - - - - 2,459,445 8,122,950 The movement in provision for rental guarantees during the period was as follows: Opening balance 46,635 143,506 Increase in provision for rental guarantees - - Rental guarantees paid during the period (46,635) (96,871) Reversals of amounts provided - - Closing balance - 46,635 As part of the sale of the Trust's Rocks Shopping Fair property in February 2016, the Trust provided a two year rental guarantee to the purchaser over the three vacant shops within the property. Page 25

31 December 30 June 2017 2017 16 Deferred tax liabilities $ $ Deferred tax liabilities comprises temporary differences attributable to: Prepayments 208,581 198,065 Lease receivable debtor 380,357 337,375 Inventory 53,664 53,664 Investment property 12,145,303 11,519,413 Total deferred tax liabilities 12,787,905 12,108,517 17 Financial liabilities Current Loans - financial institutions 19,815,000 4,195,309 19,815,000 4,195,309 Non-current Loans - financial institutions 93,586,197 70,231,783 93,586,197 70,231,783 113,401,197 74,427,092 Details of the Trust's financial liabilities at balance date are as follows: Facility Utilised Facility Utilised 31 December 31 December 30 June 30 June 2017 2017 2017 2017 Facility $ $ $ $ Loan - National Australia Bank (i) 58,852,750 57,394,857 59,023,250 50,416,783 Loan - ING Bank (Australia) (ii) 21,015,000 19,815,000 21,015,000 19,815,000 Loan - ING Bank (Australia) (iii) 17,300,000 17,300,000 - - Loan - ING Bank (Australia) (iv) 7,865,000 7,865,000 - - Loan - Bank of Queensland (v) 16,500,000 11,026,340 14,300,000 4,195,309 Total facilities 121,532,750 113,401,197 94,338,250 74,427,092 The Trust had $8,131,553 (June 2017: $19,911,158) in unused finance facilities at balance date. (i) The National Australia Bank finance facility is secured by first registered mortgages over eight of the investment properties held by the Trust and a first priority General Security Agreement over all present and after-acquired property of the Trust. The facility has a maturity date of June 2019. (ii) The ING Bank (Australia) finance facility is secured by a first registered mortgage over, and a General Security Agreement limited to, the property known as 'The Rocket' of which the Trust owns 50%. This is a joint facility with the co-owner of that property. The amounts quoted represent the Trust's 50% interest. The facility has a maturity date of October 2018. (iii) The ING Bank (Australia) finance facility is secured by a first registered mortgage over, and a General Security Agreement limited to, three of the investment properties held by the Trust. The facility has a maturity date of September 2020. (iv) The ING Bank (Australia) finance facility is secured by a first registered mortgage over, and a General Security Agreement limited to, the Spring Hill property held by the Trust. The facility has a maturity date of September 2020. (v) The Bank of Queensland finance facility is secured by a first registered mortgage over, and a General Security Agreement limited to, the development property known as "Epiq" Lennox. The facility has a maturity date of January 2019. Since balance date, the Trust has agreed a new $21,000,000 facility with a maturity date of January 2020. Page 26

31 December 30 June 2017 2017 18 Derivative financial instruments $ $ Non-current Interest rate swap contracts at fair value 1,869,053 2,358,637 1,869,053 2,358,637 The Trust manages its cash flow interest-rate risk by using floating-to-fixed interest rate derivatives. Such interest rate derivatives have the economic effect of converting borrowings from floating rates to fixed rates. Generally, the Trust raises long term borrowings at floating rates. Information regarding the Trust's exposure to interest rates is provided in note 26(c). Details of principal amounts, expiry dates and interest ranges of interest rate derivative (hedging) contracts are set out in note 26(d). 19 Franking credits Franking credits available for subsequent years based on a tax rate of 30% - 879,788-879,788 The above amounts represent the balance of the franking account as at the end of the financial year, adjusted for: - franking credits that will arise from the payment of the amount of the provision for income tax at the reporting date. 20 Segment reporting The Trust operates as a property investor throughout Australia. 21 Contingencies The Responsible Entity, on behalf of the Trust, has commenced court action against the Co-Owner of the Trust's property at 203 Robina Town Centre Drive, Robina Qld. The outcome of this action remains uncertain. Legal fees in respect to this matter are being paid by the Trust. No asset or liability has been recognised within these financial statements (June 2017: $Nil). 22 Commitments for capital expenditure As at 31 December 2017 the Trust had the following commitments contracted for which costs have not been recognised as liabilities. Inventory Development costs in respect to "Epiq" Lennox payable within 12 months 10,420,260 4,865,161 10,420,260 4,865,161 Page 27

31 December 31 December Note 2017 2016 23 Notes to the statement of cash flows $ $ a) Cash and cash equivalents Cash at the end of the period as shown in the statement of cash flows is reconciled to the related items in the statement of financial position as follows: Security deposits 6 3,700 3,700 Cash held in trust 6 1,755,050 287,831 Cash at bank 6 1,302,569 1,359,158 b) Reconciliation of net profit to net cash flows from operating activities 3,061,319 1,650,689 Total comprehensive profit attributable to unitholders 3,399,640 6,469,230 Non-cash items: Profit (loss) on sale of non-current assets (44,695) - Fair value adjustments to investment properties (2,500,374) (1,709,026) Straightlining of rental income (143,275) 99,783 Amortisation of lease incentives and leasing fees 94,616 92,655 Changes in assets and liabilities: Decrease (increase) in current receivables 29,666 (127,181) Decrease (increase) in trust distributions receivable - - Decrease (increase) in inventories (6,994,490) 3,227,146 Decrease (increase) in deferred tax assets 658,919 335,953 Decrease (increase) in other assets (443,966) 132,623 Increase (decrease) in sundry creditors 575,060 111,745 Increase (decrease) in other liabilities (6,174,027) 412,902 Increase (decrease) in GST payable (129,595) 139,824 Increase (decrease) in provision for income tax 101,743 1,207,802 Increase (decrease) in deferred tax liabilities 679,388 1,228,772 Increase (decrease) in income in advance 557,157 272,150 Increase (decrease) in derivative financial instruments (489,584) (1,643,102) Net cash provided by/(used in) operating activities (10,823,817) 10,251,276 24 Events subsequent to reporting date Property acquisition A contract for the purchase of a large format retail property at 1-17 Compton Road, Underwood in Brisbane (known as "The Zone, Underwood") was signed in December 2017 for $31,250,000. Settlement is due to take place during April 2018. The purchase is expected to be funded by a new finance facility secured by the property itself and the currently unencumbered Hamilton property, together with proceeds from the current capital raising. Page 28

25 Related party disclosures a) Responsible Entity The Trust is required to have an incorporated responsible entity to manage the activities of the Trust. The Responsible Entity of Westlawn Property Trust is Clarence Property Corporation Limited. b) Key management personnel The following persons were key management personnel of the Responsible Entity from 1 July 2017 to 31 December 2017, unless otherwise stated. Key management person Jim Dougherty Peter Fahey Geoff Shepherd Tony Tippett Position Chairman Non-Executive Managing Director - Executive Director Non-Executive Director Non-Executive c) Key management personnel compensation No compensation is paid to any of the key management personnel or employees of the Responsible Entity directly by the Trust. d) Unit holdings: The Responsible Entity and its key management personnel held units in the Trust as follows: Balance Net Purchases Balance Net Purchases Balance 01/07/2016 / (Sales) 30/06/2017 / (Sales) 31/12/2017 Jim Dougherty: James Dougherty - - - - - JW & CP Dougherty Super Fund 372,021-372,021-372,021 Peter Fahey: P & D Fahey Super Fund 589,544 40,859 630,403 9,448 639,851 Tony Tippett: Tippett Superanuation Fund - 329,082 329,082 12,266 341,348 Remain Fluid At All Times Pty Ltd - 113,955 113,955-113,955 Geoff Shepherd: HS P/L Super Fund No. 2 1,275,000 98,548 1,373,548 41,489 1,415,037 Responsible Entity: Clarence Property Corporation Ltd 510,343 47,656 557,999 25,089 583,088 Total 2,746,908 630,100 3,377,008 88,292 3,465,300 Page 29

31 December 31 December 2017 2016 25 Related party disclosures (continued) $ $ e) Transactions Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated: The Manager Paid/payable to the Manager: Management fees 669,150 561,959 Acquisition fees 682,427 308,994 Disposal fees 7,560 246,800 Development management fees 48,000 48,000 Project management fees 48,000 - Sales Commission - 123,400 Registry fees 9,000 6,000 Reimbursable expenses 275,855 2,300 1,739,992 1,297,453 Clarence Property Works Pty Ltd Property management, rent review & leasing fees 501,636 479,313 Westlawn Insurance Brokers Pty Ltd Insurance premiums 230,354 188,672 including broker fee of 22,000 24,000 Page 30

26 Financial instruments a) Financial risk management The Trust has exposure to the following risks from its use of financial instruments: - Credit risk - Liquidity risk - Market risk (interest rate risk & equity price risk). i) Credit risk Credit risk is the risk of financial loss to the Trust if a customer or counterpart to a financial instrument fails to meet its contractual obligations, and arises principally from the Trust's receivables from tenants and investment in securities. Trade and other receivables The Trust's exposure to credit risk is influenced mainly by the individual characteristics of each purchaser. The Trust has a diverse range of tenants and therefore there is no significant concentration of credit risk, either by nature of industry or geographically. Investment in securities The Trust limits its exposure to credit risk by only investing in liquid securities or securities that have fixed term durations. ii) Liquidity risk Liquidity risk is the risk that the Trust will not be able to meet its financial obligations as they fall due. The Trust's approach to managing liquidity is to ensure, as far as possible, it always has sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Trust's reputation. The Trust has liquidity risk management policies, which assist in monitoring cash flow requirements. Typically the Trust ensures it has sufficient cash on demand to meet expected operational expenses and commitments for a period of 90 days, including the servicing of financial obligations. Cash on demand is defined as cash held or unutilised borrowing facilities. The Trust also ensures that as far as practicable, sufficient borrowing facilities are approved for a minimum of 3 years. iii) Market risk Market risk is the risk that changes in market prices, such as interest rates and equity prices, will affect the Trust's income or value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposure within acceptable parameters, while optimising the return. The Trust enters into financial liabilities in order to manage market risks. Interest rate risk Interest rate risk is the risk that a financial instrument's value will fluctuate as a result of changes in the market interest rate. The Trust has a guideline that 70-90% of its exposure to changes in interest rates on borrowings is hedged through entering into fixed rate bills or interest rate swaps. Additionally the Trust may hold interest rate caps to provide further protection should extreme unforeseen circumstances arise. Equity securities price risk Equity securities price risk is the movement in quoted price of stocks which is influenced by a range of factors, most of which are outside the control of the Trust. The Trust only invests in securities that are primarily backed by real property assets. Page 31

26 Financial instruments (continued) b) Credit risk The carrying amount of the Trust's financial assets represents the maximum credit exposure. The Trust's maximum exposure to credit risk at reporting date was: 31 December 2017 $ 30 June 2017 $ Cash and cash equivalents 3,061,319 8,040,203 Trade receivables 95,945 128,025 Construction Bonds 889,323 595,637 Financial assets at fair value through profit or loss 1,425,000 5,471,587 1,425,000-10,188,865 c) Liquidity risk The following are the contractual maturities of financial liabilities: 31 December 2017 Non-derivatives Secured loans Trade & other payables Carrying amount 1 year or less 1-3 years 3-5 years $ $ $ $ 113,401,197 19,815,000 93,586,197-4,486,272 4,486,272 - - 117,887,469 24,301,272 93,586,197 - More than 5 years $ - - - Derivatives Net settled interest rate swaps 1,869,053 1,164,345 729,896 - - 1,869,053 1,164,345 729,896 - - 30 June 2017 Non-derivatives Secured bank loans/bills 74,427,092 4,195,309 70,231,783 - - Trade & other payables 9,574,717 84,001,809 9,574,717 13,770,026-70,231,783 - - - - Derivatives Net settled interest rate swaps 2,358,637 2,358,637 1,131,906 1,131,906 1,274,028 1,274,028 - - - - Page 32

26 Financial instruments (continued) d) Interest rate risk At reporting date the interest rate profile of the Trust's interest bearing financial instruments was: Weighted average effective interest rate 31 December 30 June 31 December 2017 2017 2017 % % $ 30 June 2017 $ Variable rate financial assets Cash - National Australia Bank 1.24 1.46 1,018,133 7,438,542 Cash - Commonwealth Bank of Australia 0.25 0.25 280,651 404,432 Cash - Bank of Queensland N/A N/A 3,785 1,302,569 1,721 7,844,695 Variable rate financial liabilities Loan - National Australia Bank 3.54 3.69 57,394,857 50,416,783 Loan - ING Bank (Australia) 3.41 3.42 19,815,000 19,815,000 Loan - ING Bank (Australia) 3.95 N/A 17,300,000 - Loan - ING Bank (Australia) 3.95 N/A 7,865,000 - Loan - Bank of Queensland 5.00 5.00 11,026,340 113,401,197 4,195,309 74,427,092 In addition the Trust holds the following treasury instruments: Type BBSY Rate Amount $ Start Date Expiry Date Fixed Rate Swap Fixed Rate Swap 3.65% 60,000,000 Aug-17 3.90% 60,000,000 Aug-18 Aug-18 Aug-19 Page 33

26 Financial instruments (continued) Sensitivity analysis Interest rate risk represents the effect of a change in interest rates applied to the interest rate risk exposures at reporting date, including the estimated change in the value of derivative financial instruments that are carried at fair value. Cash and floating rate debt at reporting date are multiplied by the reasonably possible change in interest rates to determine the effect on profit for the financial year. The Trust's derivative financial instruments whose carrying values are affected by changes in interest rates are interest rate swaps. In calculating the change in value of interest rate swaps, a change in interest rates at reporting date is assumed to result in a parallel shift in the forward yield curve. A change in interest rates of up to 100 basis points (1%) is considered to be reasonably possible in the current economic environment. An increase of 100 basis points in interest rates at the reporting date would have increased net profit before tax by $466,577 (June 2017: an increase of $1,208,479); an equal change in the opposite direction would have decreased net profit before tax by $466,577 (June 2017: a decrease of $1,208,479). e) Equity securities price risk The Trust has no exposure to equity investments listed on the Australian Securities Exchange. f) Fair values The net fair values of listed investments have been valued at the quoted market bid price at balance date. For other assets and other liabilities net fair value approximates their carrying value and is determined from observable market data (directly or indirectly). No financial assets or financial liabilities are readily traded on organised markets in standardised form other than listed investments. The aggregate net fair values and carrying amounts of financial assets and financial liabilities are disclosed in the Statement of Financial Position and in the notes to the financial statements. 27 Trust details The principal place of business is 2/75 Tamar Street Ballina NSW and its principal activity is investing in commercial rental properties. At 31 December 2017 there were sixteen employees of the Responsible Entity. Page 34