FIRST GROWTH HOLDINGS LTD. (Formerly Known as Vida Ventures Ltd.) Audited Consolidated Financial Statements. (Expressed in Canadian Dollars)

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1 Audited Consolidated Financial Statements June 30, 2014 and 2013

2 Management s Responsibility for Financial Reporting To the Shareholders of First Growth Holdings Ltd.: Management is responsible for the preparation and presentation of the accompanying consolidated financial statements, including responsibility for significant accounting judgments and estimates in accordance with International Financial Reporting Standards and ensuring that all information in the annual report is consistent with the statements. This responsibility includes selecting appropriate accounting principles and methods, and making decisions affecting the measurement of transactions in which objective judgment is required. In discharging its responsibilities for the integrity and fairness of the consolidated financial statements, management designs and maintains the necessary accounting systems and related internal controls to provide reasonable assurance that transactions are authorized, assets are safeguarded and financial records are properly maintained to provide reliable information for the preparation of the consolidated financial statements. The Board of Directors is responsible for overseeing management in the performance of its financial reporting responsibilities, and for approving the financial information included in the annual report. The Board fulfils these responsibilities by reviewing the financial information prepared by management and discussing relevant matters with management and external auditors. The Board is also responsible for recommending the appointment of the Company's external auditors. MNP LLP is appointed by the shareholders to audit the consolidated financial statements and report directly to them; their report follows. The external auditors have full and free access to, and meet periodically and separately with, both the Board and management to discuss their audit findings. October 27, 2014 (signed) (signed) Han Liang Pan Director Iat Wai Chan Director

3 INDEPENDENT AUDITORS' REPORT To the Shareholders of First Growth Holdings Ltd.: We have audited the accompanying consolidated financial statements of First Growth Holdings Ltd. (the Company ) which comprise the consolidated statements of financial position as at June 30, 2014 and 2013, and the consolidated statements of operations and comprehensive loss, changes in shareholders equity and cash flows for the years then ended, and a summary of significant accounting policies and other explanatory information. Management s Responsibility for the consolidated Financial Statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as at June 30, 2014 and 2013, and their financial performance and their cash flows for the years then ended, in accordance with International Financial Reporting Standards. Emphasis of Matter Without qualifying our opinion, we draw attention to Note 1 in the consolidated financial statements which discloses matters and conditions that indicate the existence of a material uncertainty that may cast significant doubt about the Company s ability to continue as a going concern. October 27, 2014 Vancouver, BC Chartered Accountant

4 Consolidated Statements of Financial Position As At June 30, 2014 and 2013 Notes June 30, June 30, $ $ ASSETS Current Assets Cash and cash equivalents 196,848 8,551 Short-term investment 4 4,101,757 - Accounts receivable 5 46,677 15,528 Inventory 6 856,080 15,401 Prepaid expenses 140,557 9,899 Total Current Assets 5,341,919 49,379 TOTAL ASSETS 5,341,919 49,379 LIABILITIES Current Liabilities Accounts payable & accrued liabilities 7 756, ,301 Bank loan 8-19,000 Loan payable 9-25,000 Due to related parties , ,069 Deferred revenue 77, ,430 Total Current Liabilities 1,239, ,800 SHAREHOLDERS' EQUITY Common shares 11 10,284,534 1,201 Class A special shares - 11,770 Reserves 700,376 - Deficit (6,882,596) (836,392) Total Shareholders' Equity 4,102,314 (823,421) TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 5,341,919 49,379 On behalf of the board: Han Liang Pan Director Iat Wai Chan Director Han Liang Pan Iat Wai Chan The accompanying notes are an integral part of these consolidated financial statements.

5 Consolidated Statements of Net Loss and Comprehensive Loss Year Ended June 30, Notes $ $ Revenue 1,864,113 1,664,877 Cost of Sales (1,553,701) (1,301,153) Gross Margin 310, ,724 Expenses Advisory 30,000 - Consulting fees ,008 70,757 Filing fees 8,880 - Listing cost 3 4,619,181 - Marketing and promotion 143,153 23,194 Meals and travel 174,260 59,107 Merchant fees 52,392 41,511 Office and general 122,282 52,713 Payroll ,376 77,116 Professional fees 312, ,489 Share-based compensation 202,131 - Technical support 35,240 23,740 Transfer agent fees 8,028 - (6,477,793) (465,627) Other Income (Expenses) Write off gift card 2 82,431 Interest (1,957) (37,526) Foreign exchange loss 40,703 - Net Loss and Comprehensive Loss (6,046,204) (139,429) Basic and Diluted Loss Per Share (0.16) (0.01) Weighted Average Number of Common Shares Outstanding 36,906,298 11,584,872 The accompanying notes are an integral part of these consolidated financial statements.

6 Consolidated Statements of Cash Flows Cash provided by (used in): Year Ended June 30, Notes $ $ Operating activities Net loss for the year (6,046,204) (139,429) Items not involving cash: Listing cost 3 4,619,181 - Advisory expense 30,300 - Share-based compensation 202,131 - Changes in non-cash operating working capital: Accounts receivable (10,647) (12,368) Inventory (840,679) (15,401) Prepaid expenses (128,401) (8,576) Deferred revenue (56,987) 8,192 Due to related parties - 0 Accounts payable & accrued liabilities 458,336 88,507 Net change in operating activities (1,772,970) (79,075) Cash flows from investing activities: Acquisition of business 3 560,533 - Loan payable - 7,170 Short-term Investment (4,061,757) - Net change in financing activities (3,501,224) 7,170 Cash flows from financing activities: Share Capital 5,563,081 - Bank Loan (19,000) 19,000 Share issued for cash - 24 Due to related parties (81,590) 29,771 Net change in financing activities 5,462,491 48,795 Net change in cash 188,297 (23,110) Cash, beginning of the year 8,551 31,661 Cash, end of the year 196,848 8,551 Supplementary cash flow information (Note 12) The accompanying notes are an integral part of these consolidated financial statements.

7 Consolidated Statements of Changes in Shareholders Equity (Deficiency) (Expressed in Canadian Dollars, unless stated otherwise) Common Share Class A Special Share Number of Number of Reserve Deficit Shareholders Equity Shares $ Shares $ $ $ $ Balance June 30, ,526,916 1,177 11,770 11,770 - (696,963) (684,016) Issuance of common shares for cash 235, Net loss and comprehensive loss for the year (139,429) (139,429) Balance June 30, ,761,959 1,201 11,770 11,770 (836,392) (823,421) Issuance of common shares for consulting 2,938, services Warrants exercised 600,000 92, ,526 Consolidation of Vida 14,700,000 4,509,244 (11,770) (11,770) 333,427-4,830,901 Transaction cost due to amalgamation with Vida Issuance of common shares and share purchase warrants pursuant to private placement 843, , ,000 20,167,666 6,050, ,818-6,215,118 Share issuance cost - (622,037) (622,037) Share-based compensation , ,131 Net loss and comprehensive loss for the year (6,046,204) (6,046,204) Balance June 30, ,010,999 10,284, ,376 (6,882,596) 4,102,314 The accompanying notes are an integral part of these consolidated financial statements.

8 1. NATURE OF OPERATIONS AND CONTINUANCE OF OPERATIONS First Growth Holdings Ltd., formerly known as Vida Ventures Ltd., (the Company or FGH ) was incorporated under the Canada Business Corporations Act on January 25, The Company is engaged primarily in the business of distribution, marketing, and sale of grape wine products in Ontario and Alberta. On November 18, 2013, the Company acquired all the issued and outstanding common stock of WineOnline Marketing Company Ltd. ( WineOnline ) and changed its name to First Growth Holdings Ltd. under the Canada Business Corporations Act (the Transaction ). WineOnline, incorporated under the Canada Business Corporations Act on June 23, 2008, is now one of the wholly-owned subsidiaries of FGH. This Transaction was accounted for as a reverse acquisition as the former shareholders of WOL as well as new investors acquired control of the Company. The Transaction is considered a purchase of the Company s operations by the shareholders of WineOnline. The Transaction is recorded in accordance with guidance provided in IFRS 2 Share Based Payments and IFRS 3 Business Combinations. As the Company did not qualify as a business according to the definition in IFRS 3, this Transaction does not constitute a business combination; rather it is treated as an issuance of shares by WineOnline for the net assets of the Company and the listing status. In conjunction with the Transaction, the Company changed its fiscal year end to June 30. In addition, the Company incorporated two wholly-owned subsidiaries, WineOnline Alberta Ltd. and WineOnline Silva Bay Services Ltd, in fiscal year WineOnline Alberta Ltd. was incorporated under the Alberta Business Corporations Act on June 30, 2014 and WineOnline Silva Bay Services Ltd. under the British Columbia Business Corporations Act on April 17, Both subsidiaries remain inactive in fiscal year The Company s common shares commenced trading on the TSX Venture Exchange ( Exchange ) on November 25, 2013 under the stock symbol FGH. These consolidated financial statements have been prepared using International Financial Reporting Standards ( IFRS ) applicable to a going concern, which assumes that the Company will be able to realize its assets and discharge its liabilities and commitments in the normal course of operations for the foreseeable future. Since 2013, the Company has focused on rebranding its brand, website, sales and marketing activities. These activities have been funded by a combination of revenue generated from the sale of the Company s products and services and equity financing. The Company s expenses have exceed its revenue for the past two years, and has incurred a net loss for the year ended June 30, 2014 of $6,046,204 ( $139,429) and a working capital as of June 30, 2014 of $4,102,314 ( $823,421 working capital deficiency). In addition, as the Company s planned level of expenditures for 2015 exceeds its committed sources of funds, there is significant doubt about its ability to continue as a going concern and, accordingly, the appropriateness of the use of accounting principles applicable to a going concern. Management s current strategy is to focus on expanding to China and other provinces in Canada s market share of the wine industry, at the same time to exercise careful cost control to sustain operations in the near term. Management recognizes the Company s need to expand its cash reserves in the coming year if it intends to adhere to its sales and marketing plans and has evaluated its potential sources of funds, including: increased revenue from sale of its products and services and possible equity financing. Although management intends to assess and act on these options through the course of the year, there can be no assurance that the steps Management takes will be successful.

9 1. NATURE OF OPERATIONS AND CONTINUANCE OF OPERATIONS (CONT D ) In the event that cash flow from operations, together with the proceeds from any future financings are insufficient to cover planned expenditures, Management will allocate available resources in such manner as deemed to be in the Company s best interest. This may result in a significant reduction in the scope of existing and planned operations. These consolidated financial statements do not reflect any adjustments, which could be material, to the carrying amounts of assets and liabilities, reported revenues and expenses, and statement of financial position classifications used that would be necessary if the Company were unable to continue as a going concern. The head office, principal address and registered office of the Company are located at W. Georgia St., Vancouver, British Columbia, V6E 3C9. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The consolidated financial statements, including comparatives, have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board ("IASB") and interpretations of the International Financial Reporting Interpretations Committee ("IFRIC"). These consolidated financial statements have been prepared on a historical cost basis except for financial instruments classified as at fair value through profit or loss and available-for-sale that have been measured at fair value. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting, except for cash flow information. These consolidated financial statements include the accounts of the Company and the following whollyowned subsidiaries: WineOnline, WineOnline Alberta Ltd., and WineOnline Silva Bay Services Ltd. Control is achieved when the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The subsidiaries are fully consolidated from the date on which control is acquired by the Company. Inter-company transactions and balances are eliminated upon consolidation. They are de-consolidated from the date that control by the Company ceases. Inter- company balances and transactions and any unrealized income and expenses arising from intercompany transactions are eliminated in preparing the consolidated financial statement. Functional and presentation currency The consolidated financial statements are presented in Canadian dollars, which is the Company s functional currency. Foreign currency transaction and translation Transactions in currencies other than the functional currency are recorded at the rates of exchange prevailing on the date of the relevant transactions. At each financial position reporting date, monetary assets and liabilities that are denominated in foreign currencies are translated at the rates prevailing at the date of the statement of financial position. Translation gains and losses are included in income or expense of the period in which they occur. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

10 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) Critical accounting judgments, estimates and assumptions The preparation of these consolidated financial statements, in conformity with IFRS, requires management to make judgments, estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of net sales and expenses during the year. However, uncertainties about these assumptions and estimates could result in outcomes that would require a material adjustment to the carrying amount of the asset or liability affected in the future. Actual results could differ from these estimates. Estimates are reviewed on an ongoing basis based on management s experience and knowledge of the facts and circumstances. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Significant areas of estimation uncertainty in applying accounting policies that have the most significant effect on the amount recognized in the statements of financial position are: i. Taxation Provisions for taxes are made using the best estimate of the amount expected to be paid based on a qualitative assessment of all relevant factors. The Company reviews the adequacy of these provisions at the end of the reporting period. However, it is possible that at some future date an additional liability could result from audits by taxing authorities. Where the final outcome of these tax-related matters is different from the amounts that were initially recorded, such differences will affect the tax provisions in the period in which such determination is made. Assumptions underlying the composition of deferred tax assets and liabilities include estimates of future results of operations and the timing of reversal of temporary differences as well as the tax rates and laws in place at the time of the expected reversal. Significant areas of critical judgments in applying accounting policies that have the most significant effect on the amount recognized in the statements of financial position are: i. Gross versus net revenue presentation assessment The determination by the Company on whether it acts as a principal in a transaction, and recognizes revenue based on the gross amount billed to a customer, or as an agent, and reports the sales transaction on a net basis requires significant judgment. Changes to the assumptions and judgments made by management could materially impact the amount of net sales recognized in a particular period. ii. Going concern Management has applied judgments in the assessment of the Company s ability to continue as a going concern when preparing its financial statements for the year ended June 30, Management prepares the financial statements on a going concern basis unless management either intends to liquidate the entity or to cease trading, or has no realistic alternative but to do so. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but is not limited to, twelve months from the end of the reporting period. Management considered a wide range of factors relating to current and expected profitability, debt repayment schedules and potential sources of

11 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) replacement financing. As a result of the assessment, management concluded there are significant doubt as to the ability of the Company to meet its obligations as they fall due and, accordingly, the ultimate appropriateness of the use of accounting principles applicable to a going concern. Cash and cash equivalents Cash and cash equivalents comprise of cash at banks and on hand, credit card receipts in transit and short-term money market instruments with an original maturity of three months or less when acquired, which are readily convertible into a known amount of cash. As at June 30, 2014, the Company s cash and cash equivalents consist of cash and credit card receipts in transit. As at June 30, 2014, cash in trust of $72,396 (June 30, $Nil) is held by the Company s counsel. Revenue Revenue comprises wine sales, commissions and revenues from ancillary actives and is measured at the fair value of the consideration received or to be received, after deducting trade discounts and salesrelated taxes and duties. Sales are recognized when the significant risks and rewards of ownership have been transferred, generally at the date of customer received the products. The Company mainly generates revenue from wine sale through its website in Ontario and Alberta, Canada. Sales of product in which the Company acts as a principal are presented on a gross basis. As a principal, the Company obtains and validates a customer s order, purchases the product from the wineries at a negotiated price, arranges for shipment of the product to customers, collects payment from customers, and processes returns. The Company s product is shipped directly to customers using third-party carriers. Sales of product in which the Company acts as an agent are presented on a net basis. Revenue is recorded when evidence of an arrangement exists, the product is received by the customer and collection is reasonably assured. (a) Sales return provision The Company estimates the level of anticipated sales returns based on historical experience and records a provision for sales returns. The historical estimate is reviewed throughout the year to ensure it reflects the most relevant data available. (b) Deferred revenue Deferred revenue includes unearned revenue on sales of gift cards and where the products have not been delivered. Revenue from the Company's gift cards is recognized when tendered for payment, or upon redemption. Outstanding customer balances are included in deferred revenue on the consolidated Statements of Financial Position. There are no expiration dates on the Company's gift cards, and the Company does not charge any service fees that cause a decrement to customer balances.

12 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) Cost of sales While the Company will continue to honor all gift cards presented for payment, management may determine the likelihood of redemption to be remote for certain card balances due to, among other things, long periods of inactivity (greater than two years). Card balances are recognized in the consolidated statements of Net Loss and Comprehensive Loss in Other income." For the years ended June 30, 2014 and 2013, revenue recognized on unredeemed gift card balances was $82,341, and Nil, respectively. Cost of sales included product cost, direct costs associated with delivering the services, duty, outbound and inbound freight costs and provision for inventory losses. Inventory Inventory is valued at the lower of cost and net realizable value net of an inventory provision. Cost of inventory is determined using specific identification of individual cost. Cost of inventory include acquisition and production costs including costs incurred to deliver inventory to the Company s distribution centers including freight, non-refundable taxes, duty and other landing costs. The inventory provision is determined based on historical information and professional judgment. Inventory comprises wine purchased for resale. Related party transactions Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control, related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. Income taxes Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognized in profit or loss except to the extent that it relates to a business combination, or items recognized 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 year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. Deferred tax is recognized 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 not recognized for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss, and differences relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will not reverse in the foreseeable future. In addition, deferred tax is not recognized for taxable temporary differences arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when the related asset is realized or liability is settled, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax

13 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously. A deferred tax asset is recognized 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 utilized. 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 realized. Earnings (loss) per share Basic earnings (loss) per share is computed by dividing net earnings (loss) available to common shareholders by the weighted average number of outstanding common shares for the period. In computing diluted earnings per share, an adjustment is made for the dilutive effect of the exercise of stock options and warrants. The number of additional shares is calculated by assuming that outstanding stock options and warrants are exercised and that the proceeds from such exercises were used to acquire common shares at the average market price during the reporting periods. In periods where a net loss is reported all outstanding options and warrants are excluded from the calculation of diluted loss per share, as they are all anti-dilutive. Comprehensive Income (Loss) Comprehensive income (loss) is the overall change in the net assets of the Company for a period, other than changes attributable to transactions with shareholders. It is made up of net income and other comprehensive income. The historical make up of net income has not changed. Other comprehensive income includes gains or losses, which IFRS requires be recognizing in a period, but excluding from net income for that period. The Company has no other comprehensive income during the year ended June 30, 2014 and Share-based payment transactions The stock option plan allows Company directors, officers and consultants to acquire shares of the Company. The fair value of share purchase options granted is recognized as an employee or consultant expense with a corresponding increase in equity. An individual is classified as an employee when the individual is an employee for legal or tax purposes (direct employee) or provides services similar to those performed by a direct employee. The fair value is measured at grant date and the share based compensation is expensed based on graded vesting. When the value of goods or services received in exchange for the share-based payment cannot be reliably estimated, the fair value of the share purchase options granted is measured using the Black-Scholes option pricing model taking into account the terms and conditions upon which the share purchase options were granted. Forfeiture rates are estimated in advance and are used in the estimate of the share-based expense for the financial statement period. Equity-settled share-based payment transactions with non-employees are measured at the fair value of the goods or services received. However, if the fair value cannot be estimated reliably, the share-based payment transaction is measured at the fair value of the equity instruments granted at the date the Company receives the goods or the services.

14 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) Share capital The Company records proceeds from share issuances net of issue costs. Common shares issued for consideration other than cash, are valued based on their market value at the date the common shares are issued. Warrants Proceeds from issuances by the Company of units consisting of shares and warrants are allocated based on the residual method, whereby the carrying amount of the warrants is determined based on any difference between gross proceeds and the estimated fair market value of the shares. If the proceeds from the offering are less than or equal to the estimated fair market value of shares issued, a nil carrying amount is assigned to the warrants. Financial Assets Financial assets are classified into one of four categories: i. Fair value through profit or loss; ii. Held-to-maturity; iii. Available-for-sale; and iv. Loans and receivables. The classification is determined at initial recognition and depends on the nature and purpose of the financial asset. i. Fair value through profit or loss ( FVTPL ) A financial asset is classified at fair value through profit or loss if it is classified as held for trading or is designated as such upon initial recognition. Financial assets are designated as at FVTPL, if the Company manages such investments and makes purchase and sale decisions based on their fair value in accordance with the Company s risk management or investment strategy. Attributable transaction costs are recognized in profit or loss when incurred. Financial assets classified as FVTPL are stated at fair value with any resultant gain or loss recognized in profit or loss. The net gain or loss recognized incorporates any dividend or interest earned on the financial asset. ii. Held-to-maturity These assets are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Company s management has the positive intention and ability to hold to maturity. Held-to-maturity investments are recognized on a trade-date basis and are initially measured at fair value, including transaction costs. Subsequent to initial recognition, these assets are measured at amortized costs using the effective interest method. If there is objective evidence that the asset is impaired, determined by reference to external credit ratings and other relevant indicators, the financial asset is measured at the present value of estimated future cash flows. Any changes to the carrying amount of the investment, including impairment losses, are recognized in the statements of operations and comprehensive loss.

15 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) iii. Available-for sale Non-derivative financial assets not included in the above categories are classified as availablefor-sale ( AFS ). They are carried at fair value with changes therein, other than impairment losses, interest calculated using the effective interest method and foreign currency differences on AFS monetary items, recognized in other comprehensive income or loss. When an investment is derecognized or is determined to be impaired, the cumulative gain or loss previously recognized in equity is transferred to profit or loss for the period. iv. 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 initially recognized at fair value plus any directly attributable transaction costs. Subsequent to initial recognition loans and receivables are measured at amortized cost using the effective interest method, less any impairment losses v. Effective interest method The effective interest method calculates the amortized cost of a financial asset and allocates interest income over the corresponding period. The effective interest rate is the rate that discounts estimated future cash receipts over the expected life of the financial asset, or, where appropriate, a shorter period, to the net carrying amount on initial recognition. Income is recognized on an effective interest basis for debt instruments other than those financial assets classified as FVTPL. vi. Impairment of financial assets Financial assets, other than those at FVTPL, are assessed for indicators of impairment at each period end. Financial assets are impaired when there is objective evidence that, as an objective evidence of impairment could include the following: Significant financial difficulty of the issue or counterparty; or Default or delinquency in interest or principal payments; or It becoming probable that the borrower will enter bankruptcy or financial reorganization. For marketable securities classified as AFS, a significant or prolonged decline in the fair value of the securities below their cost is considered to be objective evidence of impairment. For financial assets carried at amortized cost, the amount of the impairment is the difference between the asset s carrying amount and the present value of the estimated future cash flows, discounted at the financial asset s original effective interest rate. The carrying amount of financial assets is reduced by the impairment loss directly for all financial assets with the exception of accounts receivable, where the carrying amount is reduced through the use of an allowance account. When an account receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognized in profit or loss.

16 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) Financial Assets (Cont d ) With the exception of AFS equity instruments, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized, the previously recognized impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortized cost would have been had the impairment not been recognized. In respect of AFS equity securities, impairment losses previously recognized through profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognized directly in equity. When an AFS financial asset is considered to be impaired, cumulative gains or losses previously recognized in other comprehensive income are reclassified to profit or loss in the period. vii. Derecognition of financial assets Financial assets are derecognized when the rights to receive cash flows from the assets expire or the financial assets are transferred and the Company has transferred substantially all the risks and rewards of ownership of the financial assets. On derecognition of a financial asset, the difference between the asset s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognized directly in equity is recognized in profit or loss. Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs. Financial liabilities are classified as either financial liabilities at FVTPL or other financial liabilities. i. Other financial liabilities Other financial liabilities are initially measured at fair value, net of transaction costs, and are subsequently measured at amortized cost using the effective interest method, with interest expense recognized on an effective yield basis. The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating interest expenses over the corresponding period. The effective interest rate is the rate that exactly discounts estimated future cash payments over the expected life of the financial liability, or, where appropriate, a shorter period, to the net carrying amount on initial recognition. ii. Derecognition of financial liabilities The Company derecognizes financial liabilities when, and only when, the Company s obligations are discharged, cancelled or they expire. The Company has implemented the following classifications for its financial instruments:

17 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) 1. Cash and cash equivalents and short term investment has been classified as FVTPL; 2. Accounts receivables* have been classified as loans and receivables; and 3. Bank loan, accounts payables and accrued liabilities*, loan payable and due to related parties have been classified as other financial liabilities. *Accounts receivables and accounts payables and accrued liabilities exclude sales tax receivable and payable. Changes in accounting policies The following new or amended standards, and their resulting consequential amendments, were applied for the first time in the current year: IFRS 7, Financial Instruments: Disclosures IFRS 7 was amended in December 2011 to require more extensive disclosure about the offsetting of financial instruments and is effective for annual periods beginning on or after January 1, 2013, with earlier adoption permitted. The standard does not have a material impact on the financial statement IFRS 10, Consolidated Financial Statements IFRS 10 establishes principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities. IFRS 10 supersedes IAS 27, Consolidated and Separate Financial Statements and Standing Interpretation Committee ( SIC ) -12 Consolidation Special Purpose Entities, and is effective for annual periods beginning on or after January 1, Adoption of the standard had no material impact on these financial statements. IFRS 13, Fair Value Measurements IFRS 13 defines fair value, sets out a single IFRS framework for measuring value and requires disclosures about fair value measurements. IFRS 13 applies to IFRSs that require or permit fair value measurements or disclosures about fair value measurements (and measurements, such as fair value less costs to sell, based on fair value or disclosures about those measurements), except in specified circumstances. IFRS 13 is to be applied for annual periods beginning on or after January 1, Adoption of the standard had no material impact on these financial statements. Amendments to IAS 1, Presentation of Financial Statements The amendments introduce changes to presentation of items of other comprehensive income. The amendments require that an entity present separately the items of other comprehensive income that would be reclassified to profit and loss in the future if certain conditions are met from those that would never be reclassified to profit and loss. The amendments are to be applied effective July 1, 2012 and may be early adopted. The amendments are to be applied retroactively in accordance with IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors. Adoption of the standard had no material impact on these financial statements. Future accounting pronouncements Standards issued but not yet effective up to the date of issuance of the Company s financial statements are listed below. This listing is of standards and interpretations issued, which the Company reasonably expects to be applicable at a future date. The Company intends to adopt those standards when they become effective. The Company does not expect the impact of such changes on the consolidated financial statements to be material.

18 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) Future accounting pronouncements (Cont d ) IFRS 2 Share-based payment The amendments to IFRS 2, issued in December 2013 clarify the definition of vesting conditions, and separately define a performance condition and a service condition. A performance condition requires the counterparty to complete a specified period of service and to meet a specified performance target during the service period. A service condition solely requires the counterparty to complete a specified period of service. The amendments are effective for share-based payment transactions for which the grant date is on or after July 1, IFRS 3 Business combinations The amendments to IFRS 3, issued in December 2013, clarify the accounting for contingent consideration in a business combination. At each reporting period, an entity measures contingent consideration classified as an asset or a financial liability at fair value, with changes in fair value recognized in profit or loss. The amendments are effective for business combinations for which the acquisition date is on or after July 1, IFRS 7 Financial instruments: disclosures and IAS 32 Financial instruments: presentation Financial assets and financial liabilities may be offset, with the net amount presented in the statement of financial position, only when there is a legally enforceable right to set off and when there is either an intention to settle on a net basis or to realize the asset and settle the liability simultaneously. The amendments to IAS 32, issued in December 2011, clarify the meaning of the offsetting criterion "currently has a legally enforceable right to set off" and the principle behind net settlement, including identifying when some gross settlement systems may be considered equivalent to net settlement. The amendments will only affect disclosure and are effective for annual periods beginning on or after January 1, IFRS 9 Financial instruments IFRS 9 was issued in November 2009 and subsequently amended as part of an ongoing project to replace IAS 39 Financial instruments: Recognition and measurement. The standard requires the classification of financial assets into two measurement categories based on the entity s business model for managing its financial instruments and the contractual cash flow characteristics of the instrument. The two categories are those measured at fair value and those measured at amortized cost. The classification and measurement of financial liabilities is primarily unchanged from IAS 39. However, for financial liabilities measured at fair value, changes in the fair value attributable to changes in an entity s own credit risk is now recognized in other comprehensive income instead of in profit or loss. This new standard will also impact disclosures provided under IFRS 7 Financial instruments: disclosures. In November 2013, the IASB amended IFRS 9 for the significant changes to hedge accounting. In addition, an entity can now apply the own credit requirement in isolation without the need to change any other accounting for financial instruments. The mandatory effective date of January 1, 2015 has been removed to provide sufficient time for preparers of financial statements to make the transition to the new requirements. IAS 16 Property, plant and equipment and IAS 38 Intangible assets The amendments to IAS 16 and IAS 38, issued in December 2013, clarify how an entity calculates the gross carrying amount and accumulated depreciation when a revaluation is performed. The amendments are effective for annual periods beginning on or after July 1, 2014.

19 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT D ) Future accounting pronouncements (Cont d ) IAS 24 Related party disclosures The amendments to IAS 24, issued in December 2013, clarify that a management entity, or any member of a group of which it is a part, that provides key management services to a reporting entity, or its parent, is a related party of the reporting entity. The amendments also require an entity to disclose amounts incurred for key management personnel services provided by a separate management entity. This replaces the more detailed disclosure by category required for other key management personnel compensation. The amendments will only affect disclosure and are effective for annual periods beginning on or after July 1, IAS 36 Impairment of assets The amendments to IAS 36, issued in May 2013, require: Disclosure of the recoverable amount of impaired assets; and Additional disclosures about the measurement of the recoverable amount when the recoverable amount is based on fair value less costs of disposal, including the discount rate when a present value technique is used to measure the recoverable amount. The amendments will only affect disclosure and are effective for annual periods beginning on or after January 1, REVERSE TAKE-OVER On November 18, 2013, the Company completed the Transaction by acquiring all of the issued and outstanding common shares and Class A special shares of WineOnline in consideration for 14,700,000 common shares of FGH and acquired 1,470,000 options issued by Vida Venture Ltd. prior to the Transaction. FGH paid 843,333 shares as finder s fee in connection with the completion of the Transaction. In connection with the Qualifying Transaction, FGH completed a non-brokered private placement financing (the Concurrent Financing ) of an aggregate of 20,067,666 subscription receipts (each, a Subscription Receipt ) at a price of $0.30 per Subscription Receipt for aggregate gross proceeds of $6,020,300. The Concurrent Financing closed in two tranches on September 27, 2013 and November 5, Upon closing of the Agreement, each Subscription Receipt was automatically exercised into one unit of FGH (each a Unit ), for no additional consideration. Each Unit consists of one share of FGH and one-half of one share purchase warrant (each whole warrant, a Warrant ). Each Warrant entitles the holder thereof to purchase one additional share at a price of $0.45 for a period of two years from the date the Unit was issued. FGH paid an aggregate of $452,832 and issued an aggregate of 1,509,438 finders warrants, each of which is exercisable into one share at a price of $0.45 per share until two years from the dates of closing of the respective tranches, to certain finders in connection with the completion of the Concurrent Financing. The following summarizes the reverse takeover of WineOnline by the Company and FGH s assets acquired and its liabilities assumed:

20 3. REVERSE TAKE-OVER (CONT D ) Net asset acquired Cash and cash equivalents $ 560,532 Short-term investments 40,214 Prepaids 2,257 Sales tax receivables 20,289 Note receivables 25,000 Accounts payable and accrued liabilities (91,045) $ 557,246 Consideration paid: Share capital $ 4,923,427 Listing cost (4,366,181) $ 557,246 As the Transaction was not considered a business combination, the excess of the fair value of the consideration over the net assets of $4,366,181, as well as a $253,000 finder s fee relating to the issuance of 843,333 finder s shares are included as listing expense on the consolidated statements of comprehensive loss totally $4,619, SHORT TERM INVESTMENT As at June 30, 2014, the Company has a short term investment of $4,073,000 (June 30, $Nil) within a major financial institution and $28,757 interest receivable due on November 26, The shortterm investment has an annual yield of prime minus 1.8%. 5. ACCOUNT RECEIVABLE The Company s accounts receivable comprises the following: June 30, 2014 June 30, 2013 $ $ Accounts receivable 20,772 15,528 Sales tax receivable 25,905-46,677 15,528 As at June 30, 2014, there was no past due amount included in trade receivables and no allowance for doubtful accounts has been provided. 6. INVENTORY As at June 30, 2014, inventory comprised of $856,080 (June 30, $15,401) of which $550,594 relates to inventory in transit. As at June 30, 2014, there were no significant write-downs on inventory as a result of net realizable value being lower than cost, and no inventory write-downs recognized in previous years were reversed.

21 7. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES The Company s accounts payable and accrued liabilities comprise the following: June 30, 2014 June 30, 2013 $ $ Trade payables 440,696 31,617 Accrued liabilities 75,692 3,000 Other payables 240, ,053 Sales tax payables - 18, , , BANK LOAN The Company has a $25,000 revolving credit facility available for general corporate purposes which are secured by General Security Agreement. As at June 30, 2014, the Company borrowed $Nil (June 30, $19,000 which bear interest at lender s prime rate plus 2.65%). 9. LOAN PAYABLE On October 15, 2012, WineOnline entered into a promissory note ( Promissory Note ) for $10,000 with FGH, whereby WineOnline unconditionally promises to repay a loan principal amount of $10,000. The loan principal is to be repaid in full by December 31, 2013 or at a mutually agreed date. The Promissory Note is non-interest bearing loan. As result of the completion of the amalgamation with FGH on November 18, 2013, the Promissory Note has been eliminated upon consolidation. On May 28, 2013, WineOnline entered into another promissory note ( Promissory Note ) for $15,000 with FGH, whereby WineOnline unconditionally promises to repay a loan principal amount of $15,000. The loan principal is to be repaid in full by December 31, 2013 or at a mutually agreed date. The Promissory Note is non-interest bearing loan. As result of the completion of the amalgamation with FGH on November 18, 2013, the Promissory Note has been eliminated upon consolidation. 10. COMMITMENTS The Company leases vehicle under operating leases. Operating lease payments are expenses over the term of the relevant lease agreement. The Company is obligated to make future annual lease payments under operating leases for vehicle. Commencing April 3, 2010 management of the Company co-owns a vehicle with the Company for business use. The Company makes a monthly payment of $459 for the car and as of June 30, 2014 management and the Company have a balance of $4,131 (June 30, $10,395) outstanding with Honda Financial Services. Commencing November 8, 2011 management of the Company co-owns a vehicle with the Company for business use. The Company makes a monthly payment of $858 for the car and as of June 30, 2014 management and the Company have a balance of $12,870 (June 30, $23,166) outstanding with Acura Financial Services. Commencing December 20, 2013 management of the Company co-owns a delivery vehicle with the Company for business use. The Company makes a monthly payment of $691 for the car and as of June 30, 2014 management and the Company have a balance of $36,649 (June 30, $Nil) outstanding with Mercedes-Benz Financial Services.