Kazia Annual Report 2022

77 Kazia Theraputics Limited Annual Report 2022 2022 at a Glance Chairman’s Letter CEO’s Report Key Milestones Pipeline Review ESG Financial Reports Grant Thornton Australia Limited Material uncertainty related to going concern We draw attention to Note 2 in the financial statements, which indicates that the Group incurred a net loss of $24,647,815 during the year ended 30 June 2022 and had net cash outflows from operating activities of $22,762,663. As stated in Note 2, these events or conditions, along with other matters as set forth in Note 2, indicate that a material uncertainty exists that may cast doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter. Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material uncertainty related to going concern section, we have determined the matters described below to be the key audit matters to be communicated in our report. Key audit matter How our audit addressed the key audit matter Intangible asset impairment (Note 2, 3, 13) The Group carries in its statement of financial position intangible assets relating to: • the Licensing Agreement, which grants the Group the right to develop and commercialise the paxalisib molecule; and • the Licensing Agreement, which grants the Group the right to develop and commercialise the EVT801 molecule. The paxalisib Licensing Agreement has a carrying value of $10,241,444, and the EVT801 Licensing Agreement has a carrying value of $9,808,208. These assets are amortised over the remaining life of the underlying patents at the acquisition date, being 15 years and 12.5 years respectively. AASB 136 Impairment of Assets requires an entity to assess at the end of each reporting period whether there is any indication that an asset may be impaired. The entity shall estimate the asset’s recoverable amount if any indication exists. This is a key audit matter due to the materiality of the amounts and the high degree of management judgement required to assess whether there are impairment indicators. Our procedures included, amongst others: • obtained an understanding of and evaluating management’s process and controls relating to the assessment of the existence of impairment indicators; • obtaining and assessing management’s papers documenting its consideration of the existence of any impairment indicators; as well as making enquiries with the Company’s experts for their expert opinions relating to the science; • considering each of the internal and external factors outlined by AASB 136 and assessing whether any indicators of impairment are present; and • assessed the adequacy of the relevant disclosures in the financial statements. Our Collaborators

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