Accelerate Resources Limited
ABN 33 617 821 771
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
CORPORATE
Accelerate Resources Limited
ACN: 617 821 771
ABN: 33 617 821 771
Stock Exchange
Australian Securities Exchange (ASX Limited)
Home Exchange Perth
Securities
Code: AX8
Share Registry
Advanced Share Registry
110 Stirling Hwy
Nedlands WA 6009
Australian Telephone: 1300 113 258
International Telephone: (618) 9389 8033
Website: advancedshare.com.au
Auditor
RSM Australia Partners
Level 32 Exchange Tower
2 The Esplanade
Perth, WA 6000
Telephone: +61 8 9261 9100
Directors
Mr Grant Mooney
Non-Executive Chairman
Ms Yaxi Zhan
Managing Director
Mr Terry Topping
Non-Executive Director
Mr Andrew Haythorpe
Non-Executive Director
Company Secretary
Ms Deborah Ho
Registered and Principal Office
Ground Floor, 16 Ord Street
West Perth, WA 6005
Telephone: (08) 9482 0560
Facsimile: (08) 9482 0505
Website
www.ax8.com.au
Email
admin@ax8.com.au
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
TABLE OF CONTENTS
CHAIRMAN'S LETTER
2
REPORT ON OPERATIONS 3
DIRECTOR’S REPORT 10
AUDITORS' INDEPENDENCE DECLARATION
STATEMENT OF COMPREHENSIVE INCOME
STATEMENT OF FINANCIAL POSITION
STATEMENT OF CHANGES IN EQUITY
STATEMENT OF CASH FLOWS
NOTES TO THE FINANCIAL STATEMENTS
DIRECTORS' DECLARATION
20
21
22
23
24
25
39
INDEPENDENT AUDITOR'S REPORT
ASX ADDITIONAL INFORMATION
40
44
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ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
CHAIRMAN’S LETTER
Dear Shareholders,
The 2019 Financial Year has seen your Company complete what it set out in its 2018 Prospectus- to test the Mt
Read Cobalt-Copper Project in Tasmania through targeted deep drilling of the known magnetic anomalies and
undertake field exploration in the area. While the outcome of these drilling programs didn’t deliver the high grade
results that provide broad market appeal, they confirmed the existence of a large mineralized system that has the
capability of hosting broad mineralized zones. With an excellent data set now compiled, your management team
are now working to identify partners to continue our field programs into 2020 without AX8 having to spend further
funds.
We have actively sought to rationalize our project portfolio to make way for new projects and reduce spend on
lower priority projects. More recently, we sold the Bulgera Project in Western Australia for $200,000 to Norwest
Minerals and relinquished applications in the Pilbara of WA.
Amid a busy year of exploration, your Board and management were forced to deal with the unwanted distraction
of a requisition by a group of shareholders represented by the Company’s Corporate Advisers GTT to remove the
Board. Pleasingly, the Company was successful in rejecting the resolutions to dismiss the Board. Subsequently, the
Company and GTT have engaged for a 12 month term to work together to ensure the best outcome for
shareholders.
AX8 has a capital structure ideal for share price appreciation if exploration success is achieved. That is, with less
than 50 million shares on issue and a modest market capitalisation, we recognize the importance of securing the
right project to provide uplift.
As such, your board and management team are working diligently with our advisers to identify the best project in
the preferred commodity for the right consideration to protect, restore and deliver shareholder value in the coming
12 months and beyond. We have recently reduced administrative overheads including board and management
costs by up to 50% and retain approximately $700,000 in cash at the end of the Financial Year.
On behalf of the Board, I believe AX8 is in a very strong position going into 2020 secure a joint venture partner for
the Mt Read Project and identify a new project to focus our exploration efforts. We are determined to deliver on
these key objectives to ensure that value is returned to our loyal shareholders.
Grant Mooney
Chairman
2
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
REPORT ON OPERATIONS
Accelerate Resource Limited exploration projects are located in two key jurisdictions:
• The Tasmanian Project – the key focus for exploration activities during 2019
• The Western Australian gold projects.
Figure 1:
Accelerate Resources Project Location
The Company’s Mount Read Project is located on the Cape Sorell Peninsula, south of Macquarie Harbour and
approximately 48 kilometres south of the town of Strahan, in western Tasmania (Figure 2). The project comprises
four exploration licences with an area of 492 km². The tenement details are listed in Table 1:
3
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
Table 1: List of Mt Read Project Tenements
Licence
EL6/2013
EL7/2018
EL8/2018
EL9/2018
Holder
Accelerate Resources Limited
Accelerate Resources Limited
Accelerate Resources Limited
Accelerate Resources Limited
Status
Granted
Granted
Granted
Granted
Accelerate
Ownership
Area km²
100%
100%
100%
100%
224
97
139
32
Figure 2:
Accelerates Mount Read Project location
The two main prospects comprising the company’s Mount Read Project that will be the focus of exploration activity
in the first two years of operation are:
• The Thomas Creek Co-Cu-Au prospect; and
• The Henrietta Co-Ni-Cu project.
A number of other base metal targets have been identified within the Mount Read project area. These targets will
be reviewed and assessed as part of future exploration activities.
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ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
Figure 3: MMT Survey Areas over Thomas Creek Prospect on 1vd RTP Aeromagnetic Imagery
Accelerate Resources ongoing multidisciplinary exploration program on EL6/2013 aims to discover economic Cu,
Co and Au mineralization at the Thomas Creek Prospect on the Sorell Peninsula, where the company is targeting a
large intrusive related mineralisation system. (Figure 3)
The Thomas Creek Prospect is hosted by the Cambrian – aged Noddy Creek Volcanics (NCV), correlates of the
Mount Read Volcanics (MRV), which are host to a number of significant VHMS deposits of varying hybrid styles.
The NCV hosts a series of diorite intrusions, and an extensive intrusive complex of diorites occurs at the Thomas
Creek Cu-Co-Au prospect, within the southern portion of the NCV, south west of the Ordovician sediments of the
Timbertops Syncline.
Completion of drill hole TCDD004
During the year, Accelerate Resources Limited (“Accelerate” or “the Company”) completed drill hole TCDD004 to
657.0m EOH at the Thomas Creek cobalt-copper prospect. Drilling by the Company during 2018, targeted strong
chargeability highs and resistivity lows within a large 3D inversion modelled IP chargeability anomaly located along
the eastern margin of an ovoid magnetic body, below surface copper-cobalt soil anomalism defining the core of
the Thomas Creek prospect. (see ASX announcement 6th April 2018) (Figure 4).
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ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
The drilling successfully intersected a fertile mineralised system bearing abundant disseminated sulphides and
containing several felsic-intermediate intrusions and sulphide veining with associated anomalous copper-cobalt
grades. The initial three holes at Thomas Creek, TCDD001, TCDD002 and TCDD003, are interpreted to have
intersected alteration consistent with the outer propylitic and intermediate phyllic zones associated with porphyry-
style mineralisation.
Figure 4: IP chargeability and magnetic inversion shells targeted by TCDD004
1.2.2 Completion of MobileMT survey
During the late 2018, the Company contracted Expert Geophysics Limited to conduct an airborne
electromagnetic survey using its Mobile MagnetoTellurics (MobileMT) technology over the larger Thomas Creek
prospect area.
The MobileMT system is the latest innovation in airborne electromagnetics and the most recent generation of
airborne Audio-Frequency Magnetic Electromagnetic (AFMAG) technologies. (see ASX announcement 20th
November 2018).
The ~415 line-kilometre airborne MobileMT survey was completed in early January 2019 and was aimed to define
the 3D alteration and structural controls within the larger Thomas Creek porphyry system, to enhance the
geological understanding and enable targeting of further potential mineralisation.
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ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
1.2.3 New exploration targets identified
Figure 5: Thomas Creek MobileMT conductivity targets on Aeromagnetic Imagery
Modelling and interpretation of the 3D inversion data from the Mobile MT survey, has highlighted a new
conductive anomaly in the northeastern part of the Thomas Creek copper-cobalt prospect. The Mobile MT survey
also confirmed a conductive zone associated with the initial Thomas Creek IP Chargeability and geochemical
target area, where earlier drilling by the Company (TCDD001-003) has intersected anomalous copper and cobalt
mineralisation associated with semi-massive sulphide veins and broad zones of disseminated pyrite and
chalcopyrite. (Figure 5).
The newly discovered conductive anomaly in the northeastern part of Thomas Creek, is located on the eastern
flank of the Thomas Creek magnetic complex, north of a major northwest-southeast striking regional fault, which
separates the target area from the previously identified Thomas Creek mineralisation. (see ASX announcement
8th April 2019 for further details of the Mobile MT survey and results)
The Company’s current WA gold projects comprise the Mount Monger Project and Comet Project. The Bulgera
Project was sold during July 2019 (Figure 6). Current exploration activities by Accelerate has comprised historical
data reviews, interpretation and program planning. Future activities will include soil sampling, mapping and
drilling programs.
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ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
Figure 6: Accelerate Resources WA Gold Projects Location
The Bulgera Gold Project is situated at the northern end of the multi-million ounce producing Plutonic Well
greenstone belt of Western Australia and comprises two granted exploration licenses E52/3276 and E52/3316.
In June 2019, the Company received an offer, by Norwest Minerals Ltd, to acquire 100% interest in the Bulgera
project for a consideration of $220,000 including GST. The sale of the Bulgera project was subsequently
completed and announced to the ASX on 9th of July 2019.
The successful sale of the Bulgera project will boost the Company cash position by $200,000 in the September
quarter.
The project comprises two granted exploration licenses, E25/525 and E25/565 and one exploration license
application E25/586, covering 35.3 km2 in the Bulong district, 43 km east of Kambalda and approximately 70 km
by road from Kalgoorlie. The project area is located 8 km east of Silver Lake Resources Ltd.’s currently operating
1.2Mtpa Randall’s gold mill. (Figure 7)
Exploration drilling by earlier workers and more recently by POZ Minerals (ASX: POZ) has outlined a 2.5 km long
mineralised gold trend, the Kiaki Soaks prospect, along the Bare Hill Shear Zone, within the Mount Monger
project. The mineralised zone is open to the north and lies along the sheared contact between Archaean basalts
in the west and sediments to the east.
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ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
Figure 7 Mount Monger Project Location and Regional Geology
During the year, the Company applied for a new exploration license, E25/586, at the Mount Monger Project. The
new application, E25/586, covers 11.8km2 and is located 3km north of the Randalls gold mill operated by Silver
Lake Resources Ltd, (see Figure 7).
The new license application covers the southern closure of the north-northwest striking, Bulong Anticline and
includes the Hickman’s Find gold prospect, which is located on the thrust faulted and folded contact between
felsic rocks in the north and the predominantly komatiite basalt sequence to the south. The Hickman’s Find
prospect was discovered by GSWA mapping during 1986, with initial drilling by Western Mining Corporation
during the mid-late 1980’s (25 holes for 1,607m) identifying shallow, narrow, low grade gold mineralisation
associated with ferruginous chert.
Proposed exploration by Accelerate will comprise further Aircore drilling to test the strike extension of gold
mineralisation north of the Kiaki Soaks prospect. RC drilling will be undertaken to test the identified
mineralisation at depth.
The Comet Gold Project comprises one granted exploration license, E20/908 covering 37 km² and one
exploration license application, E20/939, located approximately 115 km south southwest of Meekatharra and 20
km southeast of Cue. The project covers part of the Meekatharra to Mount Magnet Greenstone belt, located at
the southern end of the Tuckabianna Shear Zone. (Figure 8)
The project lies immediately to the north and along strike of the Comet gold mine, but very little modern
exploration has been carried out within the license area. Initial exploration by Newcrest Mining Ltd and Westgold
Resources NL, during the mid-1990’s identified a mineralised gold trend in shallow RAB drilling to the north of
the Comet mine.
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ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
The RAB drilling returned a number of significant gold values over 1.4 km strike. A second zone of anomalous
drilling lies approximately one kilometre to the east where RAB and limited RC drilling returned anomalous gold
values. Neither of these targets have been followed up by further exploration or drilling to Accelerates
knowledge.
Figure 8: Comet Project tenure and location
DIRECTOR’S REPORT
Your Directors present their Report on Accelerate Resources Limited (the ‘Company’) for the financial year ended
30 June 2019.
DIRECTORS
The following were Directors of the Company at any time during the reporting period and up to the date of this
report, unless otherwise indicated, were Directors for the entire period.
Director
Mr Grant Mooney
Ms Yaxi Zhan
Mr Terry Topping
Mr Andrew Haythorpe
Title
Non-Executive Chairman
Managing Director
Non-executive Director
Non-Executive Director1
Appointment Date
1 June 2017
7 March 2017
7 March 2017
7 September 2017
1 Mr Andrew Haythorpe became a Non-Executive Director as a result of the Company’s recent cost reduction activity as
announced on 29 May 2019.
COMPANY SECRETARY
Ms Deborah Ho (appointed 14 February 2019)
Mr Brett Tucker (resigned 14 February 2019)
PRINCIPAL ACTIVITIES
The Company is an Australian gold, base metals and cobalt focussed exploration Company.
10
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
DIRECTORS REPORT (CONTINUED)
RESULTS
The loss of the Company for the financial year ended 30 June 2019 was $1,715,102 (2018: $867,747).
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
There are no significant changes in the state of affairs of the Company.
EVENTS SUBSEQUENT TO BALANCE DATE
On 9 July 2019, the Company successfully executed a Tenement Sale Agreement to sell 100% of title and rights of
Bulgera Gold Project to Norwest Minerals Limited for a consideration of $220,000 cash (inclusive of GST). The
Bulgera Gold Project comprised of Exploration Licenses E52/3316 and E52/3276. The Bulgera Project was non-core
and the sale was part of the Company’s refocus on long term growth opportunities.
There are no other matters or circumstances that have arisen since 30 June 2019 to the date of this report that
have significantly affected, or may significantly affect the Company's operations, the results of those operations,
or the Company's state of affairs in future financial years.
LIKELY DEVELOPMENTS
Information on likely developments in the operations of the Company and the expected results of operations have
not been included in this report because the directors believe it would be likely to result in unreasonable prejudice
to the Company.
DIVIDEND
No dividends have been paid by the Company during the financial year ended 30 June 2019, nor have the Directors
recommended that any dividends be paid.
ENVIRONMENTAL REGULATION
The Directors believe that the Company has, in all material respects, complied with all particular and significant
environmental regulations relevant to its operations.
PARTICULARS OF DIRECTORS AND COMPANY SECRETARY
CURRENT DIRECTORS
Grant Mooney
Qualifications and Experience
Executive Chairman
Mr. Mooney is the principal of Perth-based corporate advisory firm
Mooney & Partners, specialising in corporate compliance administration
to public companies. He has extensive experience in the areas of
corporate and project management, capital raisings, mergers and
acquisitions and corporate governance.
Interest in Shares and Options
1,000,000 Ordinary Shares
1,000,000 Options exercisable at $0.25, expiring on 30 April 2021
Directorships held in other
listed entities in the past three
years
Non-Executive Director in Barra Resources Limited (from 2002 – present)
Non-Executive Director in Carnegie Clean Energy Limited (from 2008 –
present)
Non-Executive Director in POZ Minerals Limited (from 2008 – present)
Non-Executive Director in Talga Resources Limited (from 2014 – present)
11
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
DIRECTORS REPORT (CONTINUED)
PARTICULARS OF DIRECTORS AND COMPANY SECRETARY (CONTINUED)
Yaxi Zhan
Managing Director
Qualifications and Experience
Yaxi has over 11 years of experience in the resource industry. She has
worked
in capital raising, mergers and acquisitions and project
development with Sinosteel, Norilsk Nickel and within the Australian
listed junior exploration sector.
Interest in Shares and Options
3,000,000 Ordinary Shares
3,000,000 Options exercisable at $0.25, expiring on 30 April 2021
Directorships held in other
listed entities in the past three
years
Nil
Andrew Haythorpe
Non-Executive Director
Qualifications and Experience
Mr. Haythorpe has 30 years’ experience in the mining industry and has
over 20 years of experience in the management of listed public
companies on ASX and TSX.
His recent Directorship including as Managing Director of Crescent
Gold. Under his leadership, Crescent gold grew from an $8m explorer
to a $240m producer in 3 years.
Interest in Shares and Options
2,500,000 Ordinary Shares
Directorships held in other
listed entities in the past three
years
Non-Executive Director in Petratherm Limited (from August 2016 – April
2018)
Managing Director in Cirrus Networks Holdings Limited (formerly known
as Liberty Resources Limited) (from 2008 – July 2015)
Terry Topping
Non-Executive Director
Qualifications and Experience
Mr. Topping has 30 years’ experience in the mining industry and has
over 20 years of experience in the management of listed public
companies on ASX and TSX. Terry has experience in corporate finance,
mergers and acquisitions and also as a mining and exploration geologist
in Australia and overseas.
Interest in Shares and Options
1,000,000 Ordinary Shares
1,000,000 Options exercisable at $0.25, expiring on 30 April 2021
Directorships held in other listed
entities in the past three years
Executive Chairman in Kairos Minerals Limited (from March 2017 –
present)
Non-Executive Director in Orinoco Gold Limited (from April 2017 –
present)
Executive Director in Rumble Resources Ltd (from September 2012 –
August 2015)
12
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
DIRECTORS REPORT (CONTINUED)
PARTICULARS OF DIRECTORS AND COMPANY SECRETARY (CONTINUED)
Deborah Ho
Company Secretary
Qualifications and Experience
Ms Ho has over six years of experience in company secretarial, corporate
compliance and financial accounting matters. She has acted as Company
Secretary to a number of ASX listed and private companies.
DIRECTORS' MEETINGS
The Directors attendances at Board meetings held during the year were:
Grant Mooney
Yaxi Zhan
Terry Topping
Andrew Haythorpe
Board Meetings
Number eligible to attend
10
10
10
10
Number attended
10
10
10
10
The Company does not have any remuneration, nomination or audit committees, these functions are performed
by the Board.
The Board also approved six (6) circular resolutions during the year ended 30 June 2019 which were signed by all
Directors of the Company.
REMUNERATION REPORT (AUDITED)
This report details the nature and amount of remuneration for each key management person of Accelerate
Resources Limited, and for the executives receiving the highest remuneration.
REMUNERATION POLICY
The remuneration policy of Accelerate Resources Limited has been designed to align key management personnel
objectives with shareholder and business objectives by providing a fixed remuneration component that provides
cost effective services to the Company at an early stage of its development. The Board of Accelerate Resources
Limited believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best
key management personnel to run and manage the Company, as well as create goal congruence between directors,
executives and shareholders.
The Board’s policy for determining the nature and amount of remuneration for key management personnel of the
Company is as follows:
• The remuneration policy, setting the terms and conditions for the key management personnel, was
developed and approved by the Board.
• All key management personnel receive a base salary or fee appropriate to the skills and responsibility of
the role
• The Board reviews key management personnel packages annually by reference to the Company’s
performance, executive performance and comparable information from industry sectors.
The performance of key management personnel is measured against criteria agreed annually with each executive
and is based predominantly on the forecast development of the Company’s projects. Any bonuses or incentives
must be linked to predetermined performance criteria. The Board may, however, exercise its discretion in relation
to approving incentives, bonuses and options.
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ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
REMUNERATION REPORT (AUDITED) (CONTINUED)
REMUNERATION POLICY (CONTINUED)
Any changes must be justified by reference to measurable performance criteria. The policy is designed to attract
the highest calibre of executives and reward them for performance that results in long-term growth in shareholder
wealth.
Key management personnel are also entitled to participate in the employee share and option arrangements.
All remuneration paid to key management personnel is valued at the cost to the Company and expensed. Shares
given to key management personnel are valued as the difference between the market price of those shares and
the amount paid by key management personnel. Options are valued using the Black-Scholes methodology.
The Board policy is to remunerate Non-Executive Directors at market rates for time, commitment and
responsibilities. The Board determines payments to the Non-Executive Directors and reviews their remuneration
annually, based on market practice, duties and accountability. Independent external advice is sought when
required. The maximum aggregate amount of fees that can be paid to Non-Executive Directors is subject to
approval by shareholders at the Annual General Meeting. Fees for Non-Executive Directors are not linked to the
performance of the Company. However, to align directors’ interests with shareholder interests, the Directors are
encouraged to hold shares in the Company and are able to participate in the employee option plan.
PERFORMANCE-BASED REMUNERATION
It is the Company’s intention when appropriate to include performance based remuneration as a component of
management remuneration, and this was not deemed necessary in the year under review. As outlined within this
report, during the year options were issued to key management personnel with no element dependent on the
satisfaction of performance conditions. These options were issued to incentivise directors and align their interests
to that of the Company and its shareholders.
COMPANY PERFORMANCE, SHAREHOLDER WEALTH AND DIRECTOR AND EXECUTIVE REMUNERATION
The following table shows gross income, profits (losses) and dividends for the last 3 years as a listed entity
(incorporated on 7 March 2017), as well as the share price at the end of the respective financial years. As
highlighted above, the Company currently does offer any variable remuneration incentive plans or bonus schemes
to Directors and, as such, there are no performance related links to the existing remuneration policies.
Revenue
Loss after income tax
EBITDA
EBIT
Share price at year-end
Basic loss per share (cents per share)
Dividends paid
2019
$
46,036
(1,715,102)
(1,711,883)
(1,713,998)
0.03
(3.60)
-
2018
$
21,098
(867,747)
(867,065)
(867,289)
0.14
(3.65)
-
2017
$
-
(364,881)
(364,841)
(364,841)
-
(5.13)
-
14
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
REMUNERATION REPORT (AUDITED) (CONTINUED)
KEY MANAGEMENT PERSONNEL REMUNERATION POLICY
The Board's policy for determining the nature and amount of remuneration key management for the Company is
as follows:
The remuneration structure for key management personnel is based on a number of factors, including length of
service, particular experience and skills of the individual concerned, and overall performance of the Company. The
contracts for service between the Company and key management personnel are on a continuing basis, the terms
of which are not expected to change in the immediate future. Upon retirement key management personnel are
paid employee benefit entitlements accrued to date of retirement.
SERVICE AGREEMENTS
The following Directors had contracts in place with the Company during the financial year as detailed below:
Grant Mooney, Executive Chairman
• Confirmation of Appointment dated 1 June 2017 with no termination date;
o Director fees of $50,000 per annum (post-IPO), amended to $30,000 per annum on 1 May 2019;
o There will be no payment upon termination.
Yaxi Zhan, Managing Director
• Confirmation of Appointment dated 7 March 2017 with no termination date;
o Fees of $150,000 per annum (post-IPO), amended to $110,000 per annum on 1 May 2019;
o There will be no payment upon termination.
Andrew Haythorpe, Non-Executive Director
• Confirmation of Appointment dated 15 August 2017 with no termination date;
o Fees of up to $100,000 per annum (post-IPO), amended to $20,000 per annum on 1 May 2019;
and additionally contractual income of $800 per day worked outside of that annual salary
o 1 million shares @ $0.001 upon completion of the acquisition of a Cobalt resources project;
o 1 million shares @ $0.001 upon successful listing on the ASX;
o There will be no payment upon termination.
Terry Topping, Non-Executive Director
• Confirmation of Appointment dated 7 March 2017 with no termination date;
o Fees of $40,000 per annum (post-IPO), amended to $20,000 per annum on 1 May 2019;
o There will be no payment upon termination.
DETAILS OF REMUNERATION
Compensation of Key Management Personnel Remuneration - FY2019
Short-term Benefits
Key
Management
Person
Cash, salary
and fees
$
Other
$
Directors
Yaxi Zhan
Terence Topping
Grant Mooney
Andrew Haythorpe1
Total
143,333
36,667
46,667
95,333
322,000
Post-
Employment
Benefits
Superannuati
on
$
Long-term
Benefits
Long
Service
Leave
$
Share-Based Payments
Shares
$
Options
$
Total
$
-
-
-
-
-
13,617
3,483
4,433
-
21,533
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
156,950
40,150
51,100
95,333
343,533
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ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
REMUNERATION REPORT (AUDITED) (CONTINUED)
DETAILS OF REMUNERATION (CONTINUED)
Compensation of Key Management Personnel Remuneration - FY2018
Short-term Benefits
Other
$
Key Management
Person
Directors
Yaxi Zhan
Terence Topping
Grant Mooney
Andrew Haythorpe1
Total
Cash,
salary and
fees
$
56,250
15,000
18,750
37,500
127,500
1 Appointed on 7 September 2017
Post-
Employment
Benefits
Superannuati
on
$
Long-term
Benefits
Long
Service
Leave
$
Share-Based Payments
Shares
$
Options
$
Total
$
-
-
-
-
-
5,344
1,425
1,781
-
8,550
-
-
-
-
-
-
-
-
300,000
300,000
-
-
-
-
-
61,594
16,425
20,531
337,500
436,050
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Directors
Yaxi Zhan
Terence Topping
Grant Mooney
Andrew Haythorpe
Fixed
At Risk - STI
At Risk - LTI
2019
2018
2019
2018
2019
2018
100%
100%
100%
100%
100%
100%
100%
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Cash bonuses granted as compensation for the current financial year.
No cash bonuses were granted during the year ended 2019 (2018: nil).
Other transactions with related parties
There were no other transactions with related parties during the year ended 30 June 2019. (2018: nil).
Loans from key management personnel
As at 30 June 2019, there were no outstanding amounts due to key management personnel (2018: nil).
Use of remuneration consultants
During the financial year ended 30 June 2019, the Company did not engage the services of an independent
remuneration consultant to review its remuneration for Directors, key management personnel and other senior
executives.
Voting and comments made at the company's Annual General Meeting ('AGM')
At the 2018 Annual General Meeting the remuneration resolution received a “first strike”, representation a ‘no’
vote from 53.74% of shareholders voting at the meeting, either personally or by proxy.
SHARE-BASED PAYMENTS
This section only refers to those shares and options issued as part of remuneration. As a result they may not
indicate all shares and options held by a Director or other Key Management Personnel.
Shares
No shares were issued to Directors as part of compensation during the year ended 30 June 2019.
16
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
REMUNERATION REPORT (AUDITED) (CONTINUED)
SHARE-BASED PAYMENTS(CONTINUED)
Options
No Director options were granted, exercised, sold or lapsed during the 2019 financial year.
DIRECTORS’ INTERESTS
SHAREHOLDING
The number of shares in the Company held during the financial year by each director and other members of key
management personnel of the company, including their personally related parties, is set out below:
FY2019
30 June 2019
Directors
Yaxi Zhan
Terence Topping
Grant Mooney
Andrew Haythorpe
Total
FY2018
30 June 2018
Directors
Yaxi Zhan
Terence Topping
Grant Mooney
Andrew Haythorpe
Total
Opening Balance
of Shares
No.
Granted as
Compensation
No.
Additions
Disposals / Other
Closing Balance of
Shares
No.
3,000,000
1,000,000
1,000,000
2,500,000
7,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,000,000
1,000,000
1,000,000
2,500,000
7,500,000
Opening Balance
of Shares
No.
Granted as
Compensation
No.
Additions
Disposals / Other
Closing Balance of
Shares
No.
3,000,000
1,500,000
1,000,000
-
5,500,000
-
-
-
2,000,000
2,000,000
-
-
-
-
-
-
(500,000)
-
500,000
-
3,000,000
1,000,000
1,000,000
2,500,000
7,500,000
OPTION HOLDING
The following table discloses the movement in Directors’ and Key Management Personnel’s Options during the
2019 financial year.
Balance
1 Jul 18
No.
Options
Granted
No.
Options
Exercised
No.
Options
Lapsed
No.
Yaxi Zhan
Terence Topping
Grant Mooney
Andrew Haythorpe
Total
3,000,000
1,500,000
1,000,000
-
5,500,000
-
-
-
-
-
-
-
-
-
-
-
-
Balance
30 Jun 19
No.
3,000,000
1,500,000
1,000,000
-
5,500,000
Vested
during
year
No.
Vested and
exercisable
at 30 Jun 19
No.
3,000,000
1,500,000
1,000,000
-
5,500,000
-
-
-
-
Not Vested
at 30 June
19
No.
-
-
-
-
17
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
REMUNERATION REPORT (AUDITED) (CONTINUED)
DIRECTORS’ INTERESTS (CONTINUED)
The following table discloses the movement in Directors’ and Key Management Personnel’s Options during the
2018 financial year.
Balance
1 Jul 17
No.
3,000,000
1,500,000
1,000,000
5,500,000
Options
Granted
No.
Options
Exercised
No.
Options
Lapsed
No.
-
-
-
-
-
-
-
-
-
-
-
-
Balance
30 Jun 18
No.
3,000,000
1,500,000
1,000,000
5,500,000
Vested
during
year
No.
-
-
-
-
Vested and
exercisable
at 30 Jun 18
No.
3,000,000
1,500,000
1,000,000
5,500,000
Not Vested
at 30 June
18
No.
-
-
-
-
Yaxi Zhan
Terence Topping
Grant Mooney
Total
End of Remuneration Report
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings
on behalf of the Company or the Company, or to intervene in any proceedings to which the Company is a party,
for the purpose of taking responsibility on behalf of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section
237 of the Corporations Act 2001.
DIRECTORS’ INDEMNITIES
The company has indemnified the directors and executives of the company for costs incurred, in their capacity as
a director or executive, for which they may be held personally liable, except where there is a lack of good faith.
During the financial year, the company paid a premium in respect of a contract to insure the directors and
executives of the company against a liability to the extent permitted by the Corporations Act 2001. The contract of
insurance prohibits disclosure of the nature of the liability and the amount of the premium.
AUDITOR’S INDEMNITIES
The company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor
of the company or any related entity against a liability incurred by the auditor. During the financial year, the
company has not paid a premium in respect of a contract to insure the auditor of the company or any related
entity.
CORPORATE GOVERNANCE
The Company’s Appendix 4G is released to ASX on the same day the Annual Report is released. Accelerate
Resources Limited’s Corporate Governance Statement, and the Company’s Policies, Charters and Procedures, can
be all found on the Company’s website.
NON-AUDIT SERVICES
Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by
the auditor are outlined in Note 15 to the financial statements.
The directors are of the opinion that the services as disclosed in Note 16 to the financial statements do not
compromise the external auditor's independence requirements of the Corporations Act 2001 for the following
reasons:
•
all non-audit services have been reviewed and approved to ensure that they do not impact the integrity
and objectivity of the auditor; and
18
ACCELERATE RESOURCES LIMITED
Financial Report for the year ended 30 June 2019
• none of the services undermine the general principles relating to auditor independence as set out in APES
110 Code of Ethics for Professional Accountants issued by the Accounting Professional and Ethical
Standards Board, including reviewing or auditing the auditor's own work, acting in a management or
decision-making capacity for the company, acting as advocate for the company or jointly sharing economic
risks and rewards.
OFFICERS OF THE COMPANY WHO ARE FORMER PARTNERS OF RSM AUSTRALIA PARTNERS
There are no officers of the company who are former partners of Australia Partners.
AUDITOR INDEPENDENCE
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is
set out immediately after this directors' report.
AUDITOR
RSM Australia Partners continues in office in accordance with section 327 of the Corporations Act 2001.
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations
Act 2001.
On behalf of the directors
Yaxi Zhan
Managing Director
30 September 2019
19
RSM Australia Partners
Level 32, Exchange Tower
2 The Esplanade Perth WA 6000
GPO Box R1253 Perth WA 6844
T +61 (0) 8 9261 9100
F +61 (0) 8 9261 9111
www.rsm.com.au
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of Accelerate Resources Limited for the year ended 30 June
2019, I declare that, to the best of my knowledge and belief, there have been no contraventions of:
(i)
(ii)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
any applicable code of professional conduct in relation to the audit.
RSM AUSTRALIA PARTNERS
Perth, WA
Dated: 30 September 2019
TUTU PHONG
Partner
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent
accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
A C C E L E R A T E R E S O U R C E S L I M I T E D
Financial Report for the year ended 30 June 2019
STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2019
Revenue
Other income
Expenses
Accounting and finance
ASIC and ASX
Company secretarial
Corporate advisory
Depreciation
Director and employee benefits
Insurance
Marketing and promotion
Office and occupancy expenses
Impairment of exploration expenditure
Other expenses
Share based payments expenses
Loss before income tax expense
Income tax expense
Note
2019
$
2018
$
46,036
46,036
(50,347)
(56,376)
(36,000)
(151,178)
(2,116)
(440,884)
(29,736)
(65,164)
(130,432)
(664,668)
(127,631)
(6,606)
(1,715,102)
-
21,098
21,098
(60,235)
(72,549)
(13,500)
(80,000)
(224)
(136,050)
(18,261)
(64,319)
(34,028)
-
(89,679)
(320,000)
(867,747)
-
5
11
12
Loss before other comprehensive income
(1,715,102)
(867,747)
Other comprehensive income
-
-
Total comprehensive loss
(1,715,102)
(867,747)
Earnings per share for (loss) from continuing operations
attributable to the ordinary equity holders of the Company
Basic and diluted earnings per share (cents)
10
(3.60)
(3.65)
The above Statement of Comprehensive Income should be read in conjunction with the accompanying notes
21
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
STATEMENT OF FINANCIAL POSITION
As at 30 June 2019
ASSETS
Current Assets
Cash and cash equivalents
Other current assets
Asset held for sale
Total Current Assets
Non-Current Assets
Exploration and evaluation expenditure
Plant and equipment
Total Non-Current Assets
Total Assets
LIABILITIES
Current Liabilities
Trade and other payables
Total Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
Note
2019
$
2018
$
3
4
5
5
6
7
8
9
683,235
106,148
200,000
989,383
3,279,957
11,619
3,291,576
3,434,084
134,173
-
3,568,257
2,696,538
12,590
2,709,128
4,280,959
6,277,385
79,707
79,707
367,637
367,637
79,707
367,637
4,221,252
5,909,748
5,661,905
1,487,077
(2,947,730)
4,201,252
5,661,905
1,480,471
(1,232,628)
5,909,748
The above Statement of Financial Position should be read in conjunction with the accompanying notes.
22
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2019
Balance at 1 July 2017
Loss after income tax expense for the
period
Other comprehensive income for the
period
Total comprehensive loss for the
period
Issue of shares
Share based payments
Share issue costs
Balance at 30 June 2018
Loss after income tax expense for the
period
Other comprehensive income for the
period
Total comprehensive loss for the
period
Issue of shares
Share based payments
Share issue costs
Balance at 30 June 2019
Issued Capital
$
Note
Reserves Accumulated Losses
$
$
Total Equity
$
192,313
328,408
(364,881)
155,840
-
-
-
7,250,000
320,000
(2,100,408)
5,661,905
-
-
-
-
-
-
-
-
-
-
1,152,063
-
(867,747)
(867,747)
-
-
(867,747)
(867,747)
-
-
-
7,250,000
1,472,063
(2,100,408)
1,480,471
(1,232,628)
5,909,748
-
-
-
-
6,606
-
(1,715,102)
(1,715,102)
-
-
(1,715,102)
(1,715,102)
-
-
-
-
6,606
-
5,661,905
1,487,077
(2,947,730)
4,201,252
The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.
23
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
STATEMENT OF CASH FLOWS
For the year ended 30 June 2019
Note
2019
$
2018
$
Cash Flows from Operating Activities
Payments to suppliers and employees
Payments for exploration and evaluation expenditure
Interest received
Net cash (outflows) from operating activities
13
Cash Flows from Investing Activities
Purchase of plant and equipment
Net cash (outflows) from investing activities
Cash Flows from Financing Activities
Proceeds from issue of shares
Proceeds from initial public offering
Capital raising cost
Net cash inflow from financing activities
Net increase / (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Cash and cash equivalents at the end of the financial year
3
(1,347,653)
(1,448,087)
46,036
(2,749,704)
(554,427)
(982,404)
21,098
(1,515,733)
(1,145)
(1,145)
(12,814)
(12,814)
-
-
-
-
(2,750,849)
3,434,084
683,235
250,000
5,000,000
(421,325)
4,828,675
3,300,128
133,956
3,434,084
The above Statement of Cash Flows should be read in conjunction with the accompanying notes.
24
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated.
New or amended Accounting Standards and Interpretations adopted
In the period ended 30 June 2019, the Directors have reviewed all of the new and revised Standards and Interpretations issued
by the AASB that are relevant to the Company and effective for the year-end reporting period beginning on or after 1 July 2018.
AASB 15 Revenue from Contracts with Customers and AASB 9 Financial Instruments became mandatorily effective on 1 January
2018. Accordingly, these standards apply for the first time to this set of financial statements. The Directors have determined that
there is no material impact of the new and revised Standards and Interpretations on the Company and therefore no material
change is necessary to Company’s accounting policies.
Any new or amended standards and interpretations that are not yet mandatory have not been early adopted.
Going Concern
The financial statements have been prepared on the going concern basis, which contemplates continuity of normal business
activities and the realisation of assets and discharge of liabilities in the normal course of business.
As disclosed in the financial statements, the Company incurred a loss of $1,715,102 and had net cash outflows from operating
activities of $2,749,704 for the year ended 30 June 2019. The ability of the Company to continue as a going concern is principally
dependent upon the ability of the Company to secure funds by raising additional capital from equity markets and managing cash
flows in line with available funds.
These factors indicate a material uncertainty which may cast significant doubt as to whether the Company will continue as a
going concern and therefore whether it will realise its assets and extinguish its liabilities in the normal course of business and at
the amounts stated in the financial report.
The Directors believe that it is reasonably foreseeable that the Company will continue as a going concern and that it is appropriate
to adopt the going concern basis in the preparation of the financial report after consideration of the following factors:
•
•
•
As disclosed in note 20 events subsequent to balance date, on 9 July 2019, the company disposed of 100% of title and
rights to Bulgera Gold Project to Norwest Minerals Limited for a consideration of $200,000.
The Company has the ability to issue additional equity securities under the Corporations Act 2001 to raise further
working capital; and
The Company has the ability to curtail administrative, discretionary exploration and overhead cash outflows as and
when required.
Accordingly, the Directors believe that the Company will be able to continue as a going concern and that it is appropriate to
adopt the going concern basis in the preparation of the financial report.
The financial report does not include any adjustments relating to the amounts or classification of recorded assets or
liabilities that might be necessary if the Company does not continue as a going concern.
a) Basis of Preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate
for for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards as
issued by the International Accounting Standards Board ('IASB').
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for, where applicable, the
revaluation of available-for-sale financial assets, financial assets and liabilities at fair value through profit or loss and
derivative financial instruments.
25
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial
statements, are disclosed in note 2.
Functional and Presentation Currency
These financial statements are presented in Australian dollars, which is the Company’s functional currency.
b) Cash and Cash Equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly
liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash
and which are subject to an insignificant risk of changes in value. For the statement of cash flows presentation purposes,
cash and cash equivalents also includes bank overdrafts, which are shown within borrowings in current liabilities on the
statement of financial position.
c) Other Assets
Other receivables are recognised at amortised cost, less any provision for impairment.
d) Exploration and evaluation assets
Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest. These costs
are only carried forward to the extent that they are expected to be recouped through the successful development of the
area or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of
economically recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit in the period in which the decision
to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the
area according to the rate of depletion of the economically recoverable reserves.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward
costs in relation to that area of interest.
Costs of site restoration are provided over the life of the facility from when exploration commences and are included in the
costs of that stage. Site restoration costs include the dismantling and removal of mining plant, equipment and building
structures, waste removal, and rehabilitation of the site in accordance with clauses of the mining permits. Such costs have
been determined using estimates of future costs, current legal requirements and technology on an undiscounted basis.
Any changes in the estimates for the costs are accounted on a prospective basis. In determining the costs of site restoration,
there is uncertainty regarding the nature and extent of the restoration due to community expectations and future
legislation. Accordingly, the costs have been determined on the basis that the restoration will be completed within one
period of abandoning the site.
e) Plant and Equipment
i.
Items of plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses.
Cost includes expenditure that is directly attributable to the acquisition of the asset.
Recognition and measurement
The gain or loss on disposal of an item of plant and equipment is determined by comparing the proceeds from disposal with
the carrying amount of plant and equipment and is recognised net within other income / other expenses in profit or loss.
26
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Depreciation
ii.
Depreciation is based on the cost of an asset less its residual value. Depreciation is recognised in profit or loss on a
diminishing value basis over the estimated useful lives of each part of an item of plant and equipment, since this most
closely reflects the expected pattern of consumption of the future economic benefits embodied in the asset.
The estimated useful lives for the current and comparative periods are as follows:
Office equipment
3 -10 years
Depreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate.
f) Impairment
At each reporting date, the Company reviews the carrying amounts of its assets to determine whether there is any indication
that those assets have suffered an impairment loss. An asset is impaired if objective evidence indicates that a loss
event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated
future cash flows of that asset that can be estimated reliably. If any such indication exists, the recoverable amount of the
asset is estimated in order to determine the extent of the impairment loss. When a subsequent event causes the amount
of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss.
g) Trade and other payables
These amounts represent liabilities for goods and services provided to the entity prior to the end of the financial period and
which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts
are unsecured and are usually paid within 30 days of recognition.
Wages and Salaries
h) Employee Benefits
i.
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled wholly within
12 months of the reporting date are recognised in employee provisions in respect of employees’ services up to the reporting
date and are measured at the amounts expected to be paid when the liabilities are settled.
Superannuation
ii.
The amount charged to the profit and loss in respect of superannuation represents the contributions paid or payable by the
Company to the employee’s superannuation funds.
iii.
Employee benefit on-costs, including payroll tax, are recognised when paid or payable by the Company.
Employee Benefits on-costs
Share-based payments
Equity-settled and cash-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for
the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of
cash is determined by reference to the share price.
The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined
using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the
option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the
expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that
do not determine whether the Company receives the services that entitle the employees to receive payment. No account
is taken of any other vesting conditions.
The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting
period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate
of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in
profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in
previous periods.
27
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
h) Employee Benefits (continued)
The cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either the
Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was
granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows:
•
•
during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied
by the expired portion of the vesting period.
from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at
the reporting date.
All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to
settle the liability.
Market conditions are taken into consideration in determining fair value. Therefore, any awards subject to market
conditions are considered to vest irrespective of whether or not that market condition has been met, provided all other
conditions are satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An
additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value
of the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the Company or employee, the failure to satisfy the condition is treated
as a cancellation. If the condition is not within the control of the Company or employee and is not satisfied during the vesting
period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense
is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award
is treated as if they were a modification.
h)
Investments and financial assets
Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial
measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either
amortised cost or fair value depending on their classification. Classification is determined based on both the business model
within which such assets are held and the contractual cash flow characteristics of the financial asset unless, an accounting
mismatch is being avoided.
Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the
Company has transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of
recovering part or all of a financial asset, it's carrying value is written off.
Financial assets at fair value through profit or loss
Financial assets not measured at amortised cost or at fair value through other comprehensive income are classified as
financial assets at fair value through profit or loss. Typically, such financial assets will be either: (i) held for trading, where
they are acquired for the purpose of selling in the short-term with an intention of making a profit, or a derivative; or (ii)
designated as such upon initial recognition where permitted. Fair value movements are recognised in profit or loss.
Financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income include equity investments which the Company intends
to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition.
Impairment of financial assets
The Company recognises a loss allowance for expected credit losses on financial assets which are either measured at
amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon
the Company's assessment at the end of each reporting period as to whether the financial instrument's credit risk has
increased significantly since initial recognition, based on reasonable and supportable information that is available, without
undue cost or effort to obtain.
Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected
credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable
28
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where
it is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit
losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of
anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate.
For financial assets measured at fair value through other comprehensive income, the loss allowance is recognised within
other comprehensive income. In all other cases, the loss allowance is recognised in profit or loss.
Financial Liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost.
i)
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the entity's
normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after
the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a
liability for at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the entity's normal operating cycle; it is held
primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other
liabilities are classified as non-current.
j)
Issued capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds.
k) Earnings Per Share
The Company presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic earnings per share is
calculated by dividing the profit or loss after income tax attributable to ordinary shareholders of the Company by the
weighted average number of ordinary shares outstanding during the period. Diluted earnings per share is calculated by
dividing the profit or loss after income tax attributable to ordinary shareholders of the Company by the weighted average
number of ordinary shares outstanding during the period, adjusted for the effects of all dilutive potential ordinary shares,
which comprise share options granted to employees.
Revenue
l)
Revenue is recognised on completion of performance obligation and when it is probable that the economic benefit will flow
to the Company and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration
received or receivable.
Interest
Interest revenue is recognised as interest accrues using the effective interest method.
Income Taxes
m)
Income tax expense or revenue comprises current and deferred tax. Current and deferred taxes are recognised in profit or loss
except to the extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive
income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the 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 assets and liabilities are recognised in respect of temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not
recognised for the following temporary differences, the initial recognition of assets and 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 associates 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 recognised for taxable temporary differences arising on the initial
recognition of goodwill. Deferred tax is measured at the tax rates expected to apply when the assets are recovered or
29
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
liabilities are settled, based on those rates which are enacted or subsequently enacted for each jurisdiction.
Deferred tax assets are recognised for unused tax losses, tax credits and deductible temporary differences to the extent
that it is probable that future taxable profits will be available against which they can be utilised. Deferred tax assets are
reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will
be realised.
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets and liabilities
and when the deferred tax balances relate to the same taxation authority. Current tax assets and liabilities are offset where
the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and
settle the liability simultaneously.
n) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not
recoverable from the taxation authority. 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 in the statement of financial position are shown inclusive of GST. The net amount of GST
recoverable from, or payable to, the taxation authority is included as a current asset or liability in the statement of financial
position.
Cash flows are presented in the statement of cash flows on a gross basis, except for the GST component of investing and
financing activities, which is disclosed as operating cash flows.
o) Segment Reporting
An operating segment is a component of the Company that engages in business activities from which it may earn revenues
and incur expenses, including revenues and expenses that related to transactions with any of the Company’s other
components. A geographical segment is engaged in providing products or services within a particular economic environment
and is subject to risks and returns that are different from those of segments operating in other economic environments.
The Board (Chief Operating Decision Makers “CODM”) is responsible for the allocation of resources to operating segments
and assessing their performance.
p) New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory,
have not been early adopted by the Company for the annual reporting period ended 30 June 2019. The Company's
assessment of the impact of these new or amended Accounting Standards and Interpretations, most relevant to the
Company, are set out below.
AASB 16 Leases
This standard is applicable to annual reporting periods beginning on or after 1 January 2019. The standard replaces AASB
117 'Leases' and for lessees will eliminate the classifications of operating leases and finance leases. Subject to exceptions, a
'right-of-use' asset will be capitalised in the statement of financial position, measured at the present value of the
unavoidable future lease payments to be made over the lease term. The exceptions relate to short-term leases of 12 months
or less and leases of low-value assets (such as personal computers and small office furniture) where an accounting policy
choice exists whereby either a 'right-of-use' asset is recognised or lease payments are expensed to profit or loss as incurred.
A liability corresponding to the capitalised lease will also be recognised, adjusted for lease prepayments, lease incentives
received, initial direct costs incurred and an estimate of any future restoration, removal or dismantling costs. Straight-line
operating lease expense recognition will be replaced with a depreciation charge for the leased asset (included in operating
costs) and an interest expense on the recognised lease liability (included in finance costs). In the earlier periods of the lease,
the expenses associated with the lease under AASB 16 will be higher when compared to lease expenses under AASB 117.
However EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) results will be improved as the operating
expense is replaced by interest expense and depreciation in profit or loss under AASB 16. For classification within the
statement of cash flows, the lease payments will be separated into both a principal (financing activities) and interest (either
operating or financing activities) component. For lessor accounting, the standard does not substantially change how a lessor
accounts for leases. The Company will adopt this standard from 1 July 2019 and the impact of its adoption is expected to be
minimal on the Company.
30
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
2.
CRTICIAL ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS
The preparation of the financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates
in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates
and assumptions on historical experience and on other various factors, including expectations of future events,
management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will
seldom equal the related actual results. The judgements estimates and assumptions that have a significant risk of causing a
material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial
year are discussed below.
Share-based payment transactions
The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by using either the Binomial or Black-Scholes
model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates
and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets
and liabilities within the next annual reporting period but may impact profit or loss and equity.
Exploration and evaluation costs
Exploration and evaluation costs have been capitalised on the basis that the Company will commence commercial
production in the future, from which time the costs will be amortised in proportion to the depletion of the mineral resources.
Key judgements are applied in considering costs to be capitalised which includes determining expenditures directly related
to these activities and allocating overheads between those that are expensed and capitalised. In addition, costs are only
capitalised that are expected to be recovered either through successful development or sale of the relevant mining interest.
Factors that could impact the future commercial production at the mine include the level of reserves and resources, future
technology changes, which could impact the cost of mining, future legal changes and changes in commodity prices. To the
extent that capitalised costs are determined not to be recoverable in the future, they will be written off in the period in
which this determination is made.
3.
CASH AND CASH EQUIVALENTS
Cash at bank
4. OTHER CURRENT ASSETS
Accounts receivables
GST receivable
Deposit
5. EXPLORATION AND EVALUATION EXPENDITURE
Exploration and evaluation expenditure - Mt Read
Exploration and evaluation expenditure - Bulgera
Exploration and evaluation expenditure - Mt Read
Opening balance
Additions
Impairment
Closing balance
2019
$
683,235
683,235
2019
$
7,613
12,159
86,376
106,148
2019
$
3,277,983
-
3,277,983
1,912,669
1,367,288
-
3,279,957
2018
$
3,434,084
3,434,084
2018
$
83,173
51,000
134,173
2018
$
1,912,669
783,869
2,696,538
-
1,912,669
-
1,912,669
31
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
5. EXPLORATION AND EVALUATION EXPENDITURE (CONTINUED)
Exploration and evaluation expenditure - Bulgera
Opening balance
Additions
Impairment
Reclass of balance to asset held for sale
2019
$
783,869
80,799
(664,668)
(200,000)
2018
$
30,000
753,869
-
Closing balance
783,869
As disclosed in Note 20 on 9 July 2019, the Company successfully executed a Tenement Sale Agreement to sell 100% of title
and rights of Bulgera Gold Project to Norwest Minerals Limited for a consideration of $200,000. As a result of this the asset
has been classified as held for sale asset as at 30 June 2019.
-
6. PLANT AND EQUIPMENT
Plant and equipment
- at cost
- accumulated depreciation
Plant and equipment - movements
Opening balance
Additions
Depreciation
Closing balance
7. TRADE AND OTHER PAYABLES
Trade payables
Accruals
Other payables
2019
$
13,959
(2,340)
11,619
12,590
1,145
(2,116)
11,619
2019
$
27,512
10,000
42,195
79,707
2018
$
12,814
(224)
12,590
-
12,814
(224)
12,590
2018
$
211,737
123,659
32,241
367,637
Trade creditors, excluding related party payables, are expected to be paid on 30 day terms.
8.
ISSUED CAPITAL
Ordinary shares on issue, fully paid
Reconciliation of Movement in Issued Capital
Opening Balance at 1 July 2017
Share based payment to Director
Issue of shares
Issue of shares from IPO
Issue of shares to Lead Manager
Issue of shares to Project Vendors
Share based payment to Director
Issue of shares to Consultants
Less issue costs
Closing balance at 30 June 2018
Closing balance at 30 June 2019
30-Jun-19
No.
47,620,000
30-Jun-18
No.
47,620,000
30-Jun-19
$
5,661,905
30-Jun-18
$
5,661,905
Issue Price
$
0.10
0.10
0.20
0.20
0.20
0.20
0.20
Shares
No.
8,020,000
1,000,000
2,500,000
25,000,000
5,000,000
5,000,000
1,000,000
100,000
-
47,620,000
47,620,000
Amount
$
192,313
100,000
250,000
5,000,000
1,000,000
1,000,000
200,000
20,000
(2,100,408)
5,661,905
5,661,905
32
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
8.
ISSUED CAPITAL (CONTINUED)
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in
proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the
Company does not have a limited amount of authorised capital. On a show of hands, every member present at a meeting
in person or by proxy shall have one vote and upon a poll each share shall have one vote.
Capital risk management
The Company’s objectives when managing capital are to safeguard its ability to continue as a going concern, so that it may
continue to provide returns for shareholders and benefits for other stakeholders. The Company’s capital includes ordinary
share capital and financial liabilities, supported by financial assets.
Due to the nature of the Company’s activities, being mineral exploration, it does not have ready access to credit facilities,
with the primary source of funding being equity raisings. Accordingly, the objective of the Company’s capital risk
management is to balance the current working capital position against the requirements of the Company to meet
exploration programmes and corporate overheads. This is achieved by maintaining appropriate liquidity to meet
anticipated operating requirements, with a view to initiating appropriate capital raisings as required. The Company is not
subject to any externally imposed capital requirements.
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Working capital position
9. RESERVES
Options reserve
2019
$
683,235
19,772
(79,708)
623,299
2019
$
1,487,077
2018
$
3,434,084
83,173
(367,637)
3,149,620
2018
$
1,480,471
Options and performance shares issued carry no dividend or voting rights. When exercisable each option and performance
share is convertible to one ordinary share.
Opening balance at 1 July 2017
Issue of options to Lead Manager – Note 11
Issue of options to Project Vendors – Note 11
Closing balance at 30 June 2018
Vesting of options issued to consultant
Closing balance at 30 June 2019
10. EARNINGS PER SHARE
Loss after income tax (used in calculating both basic and diluted loss per
share)
Basic loss per share (cents)
Diluted loss per share (cents)
Weighted average number of ordinary shares and potential ordinary shares
Weighted average number of ordinary shares used in calculating basic and
diluted EPS
No. of Options
6,000,000
5,000,000
4,000,000
15,000,000
200,000
15,200,000
$
328,408
666,776
485,287
1,480,471
6,606
1,487,077
2019
$
2018
$
(1,715,102)
(867,747)
(3.60)
(3.60)
(3.65)
(3.65)
Number
Number
47,620,000
23,797,534
33
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
11. SHARE BASED PAYMENTS
Shares – 30 June 2019
No shares were issued as part of a share based payment for the period ended 30 June 2019
Options
On 13 August 2018, the Company issued 200,000 unlisted options to a consultant on the condition that the consultant has
provided 12 months of continuous service to the Company as a consultant, from date of issue. The consultant options are
exercisable at $0.25 per option on or before 30 April 2020. The Black-Scholes option pricing model was used to value the
options and the following table lists the inputs to the model used for the valuation of the options:
Options
Vendor
Expiry Date
30/04/2020
Exercise Price
$0.25
Share Price at
Grant Date
$0.12
Expected
Volatility
100%
Risk-free
Interest Rate
1.99%
Fair Vale per
Option
$0.0374
Summary of options granted as at 30 June 2019 are as follows:
Grant Date
28/04/2017
18/01/2018
18/01/2018
13/08/2018
Expiry Date
30/02/2021
30/04/2021
12/02/2022
30/04/2020
Exercise
Price
$0.25
$0.25
$0.25
$0.25
Balance at
Start of Year
6,000,000
4,000,000
5,000,000
-
15,000,000
Granted
Exercised
Expired /
Forfeited /
Other
-
-
-
200,000
200,000
-
-
-
-
-
-
-
-
-
-
Balance at
End of Year
6,000,000
4,000,000
5,000,000
200,000
15,200,000
Shares – 30 June 2018
On 15 November 2017, the Company issued 1,000,000 shares to a Director (Andrew Haythorpe) at an issue price of $0.10
per share, for a total transactional value of $100,000 as identified in Note 9 and the ‘Remuneration Report’ included in the
Directors’ Report, as part of his remuneration package.
On 12 February 2018, the Company issued 1,000,000 shares to a Director (Andrew Haythorpe) at an issue price of $0.20
per share, for a total transactional value of $200,000 as identified in Note 9 and the ‘Remuneration Report’ included in the
Directors’ Report, as part of his remuneration package.
On 12 February 2018, the Company issued 100,000 shares at an issue price of $0.20 per share, for a total transaction value
of $20,000 to Ventnor Capital Pty Ltd for the provision of corporate advisory and company secretarial services.
On 12 February 2018, the Company issued 5 million shares to the lead manager and 5 million shares to the vendor at an
issue price of $0.20 per share, for a total transaction value of $2,000,000. The fair value of the shares issued to the lead
manager were treated as share issue costs in the statement of changes in equity. The fair value of the shares issued to the
vendor were treated as exploration and evaluation assets in the statement of financial position.
The total share based payment expense recognised in the in the statement of comprehensive income during the current
financial year was $320,000.
Options – 30 June 2018
On 12 February 2018, on shareholder’s approval, the Company issued 5 million lead manager options and 4 million vendor
options. The lead manager options are exercisable at $0.25 per option on or before 4 years from the date the Company is
admitted to the Official List (12 February 2022). The vendor options are exercisable at $0.25 per option on or before 30
April 2021. The Black-Scholes option pricing model was used to value the options and the following table lists the inputs to
the model used for the valuation of the options:
Options
Vendor
Lead Manager
Expiry Date
30/04/2021
12/02/2022
Exercise Price
$0.25
$0.25
Share Price at
Grant Date
$0.20
$0.20
Expected
Volatility
100%
100%
Risk-free
Interest Rate
2.13%
2.36%
Fair Vale per
Option
$0.1213
$0.1334
9.
SHARE BASED PAYMENTS
34
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
11. SHARE BASED PAYMENTS (CONTINUED)
The fair value ($666,776 – Note 10) of the options issued to the lead manager were treated as share issue costs in the
statement of changes in equity. The fair value ($485,287 – Note 10) of the options issued to the vendor were treated as
exploration and evaluation expenditure in the statement of financial position.
Summary of options granted as at 30 June 2018 are as follows:
Exercise
Price
$0.25
$0.25
$0.25
Balance at
Start of Year
6,000,000
-
-
6,000,000
Granted
Exercised
-
4,000,000
5,000,000
9,000,000
Expired /
Forfeited /
Other
-
-
-
-
-
-
-
-
Balance at
End of Year
6,000,000
4,000,000
5,000,000
15,000,000
Grant Date
28/04/2017
18/01/2018
18/01/2018
Expiry Date
30/02/2021
30/04/2021
12/02/2022
12. INCOME TAX EXPENSE
2019
$
2018
$
A reconciliation between the income tax expense and the product of
accounting profit before income tax multiplied by the Company’s applicable
income tax rate is as follows:
Loss before income tax
(1,715,102)
(867,747)
Prima facie benefit on operation loss at 27.5% (2018: 27.5%)
Non-allowable expenditure
Temporary differences not brought to account as a deferred tax asset
Tax losses not brought to account as a deferred tax asset
Income tax benefit
(471,653)
184,923
(57,220)
343,950
-
238,630
(88,036)
(52,046)
(98,548)
-
Unrecognised tax losses
2,990,130
1,739,403
A potential deferred tax asset, attributable to tax losses carried forward, amounts to approximately $822,286 (2018:
$478,336) and has not been brought to account at reporting date because the directors do not believe it is appropriate to
regard realisation of the deferred tax asset as probable at this point in time. This benefit will only be obtained if:
• the Company derives future assessable income of a nature and of an amount sufficient to enable the benefit from the
deductions for the loss incurred;
• the Company continues to comply with the conditions for deductibility imposed by law; and
• no changes in tax legislation adversely affect the Company in realising the benefit from the deductions for the loss incurred.
• the Company continues to comply with the conditions for deductibility imposed by law; and
• no changes in tax legislation adversely affect the Company in realising the benefit from the deductions for the loss incurred.
13. CASH FLOW INFORMATION
Reconciliation of Cash Flow from Operations with Loss after Income Tax
Loss after income tax
Add / (deduct) non-cash items:
Share based payment expense
Depreciation
Impairment of exploration expenditure
Changes in assets and liabilities:
Other current assets
Exploration and evaluation expenditure
Trade and other payables
Cash Outflows from Operations
2019
$
2018
$
(1,715,102)
(867,747)
6,606
2,116
664,668
28,026
(1,448,088)
(287,930)
(2,749,704)
320,000
224
(76,207)
(982,404)
90,401
(1,515,733)
35
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
14. RELATED PARTY TRANSACTIONS
a) Key Management Personnel Compensation
Short-term employee benefits
Post-employment benefits
Share-based payment
b) Transactions with Related Parties
Transactions with Related Parties
Purchase of tenement from POZ Minerals Limited (director-related entity of
Grant Mooney)
Director fees to Ouro Pty Ltd (director-related entity of A Haythorpe)
c) Other Related Party Transactions
There were no other related party transactions.
15. AUDITORS REMUNERATION
Audit services
Audit or review of the financial statements
Non-audit services
Preparation of the Investigating Accountant’s Report
2019
$
322,000
21,533
-
343,533
2019
$
2018
$
127,500
8,550
300,000
436,050
2018
$
-
783,869
101,933
101,933
783,869
2019
$
22,000
-
22,000
2018
$
22,000
6,000
28,000
16. COMMITMENTS
Operating lease commitments consists of various mining tenement leases in Tasmania (Mt Read Cobalt Project) and Western
Australia (Bulgera, Mount Monger, Comet, Pilbara).
Within 1 year
Not later than 1 year but less than 5 years
More than 5 years
2019
$
24,441
3,036
-
27,477
2018
$
1,158
14,185
-
15,343
17. OPERATING SEGMENTS
The Company has identified its operating segments based on the internal reports that are used by the Board (the chief operating
decision makers) in assessing performance and in determining the allocation of resources.
The operating segments are identified by the Board based on the phase of operation within the mining industry. For management
purposes, the Company has organised its operations into one reportable segment on the basis of stage of development as follows:
•
Exploration and evaluation assets, which includes assets that are associated with the determination and assessment
of the existence of commercial economic reserves.
The Board as a whole will regularly review the identified segments in order to allocate resources to the segment and to assess its
performance.
During the year ended 30 June 2019, the Company had no development assets. The Board considers that it has only operated in
one segment, being mineral exploration.
The Company is domiciled in Australia. Another income from external customers are only generated from Australia. No income was
derived from a single external customer.
36
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
18. FINANCIAL RISK MANAGEMENT
The Company has exposure to the following risks from their use of financial instruments:
credit risk;
liquidity risk; and
•
•
• market risk.
This note presents information about the Company’s exposure to each of the above risks, their objectives, policies and processes
for measuring and managing risk, and the management of capital.
The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework.
Management monitors and manages the financial risks relating to the operations of the Company through regular reviews of the
risks.
Credit risk
The maximum exposure to credit risk, excluding the value of any collateral or other security, at reporting date to recognised
financial assets, is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of
financial position and notes to the financial statements.
The Company has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral where
appropriate, as a means of mitigating the risk of financial loss from defaults. The Company’s exposure and the credit ratings of
its counterparties are continuously monitored and the aggregate value of transactions is spread amongst approved
counterparties.
Credit risk related to balances with banks and other financial institutions is managed by the board. The board’s policy requires
that surplus funds are only invested with counterparties with a Standard & Poor’s rating of at least AA-. All of the Company’s
surplus funds are invested with AA- Rated financial institutions.
The Company does not have any material credit risk exposure to any single receivable or Group of receivables under financial
instruments entered into by the Company.
The credit risk for counterparties included in cash and cash equivalents at 30 June 2019 is detailed below:
Financial assets:
Cash and cash equivalents
AA- rated counterparties
Liquidity risk
2019
$
683,235
683,235
2018
$
3,434,084
3,434,084
The responsibility with liquidity risk management rests with the Board of Directors. The Company manages liquidity risk by
monitoring forecast cash flows and ensuring that adequate working capital is maintained. The Company’s policy is to ensure that
it has sufficient cash reserves to carry out its planned exploration activities over the next 12 months.
Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect
the Company’s income or the value of its holdings of financial instruments.
Interest rate risk
The Company does not have any exposure to interest rate risk as there were no external borrowings at 30 June 2019 (2018: nil).
Interest bearing assets are all short term liquid assets and the only interest rate risk is the effect on interest income by movements
in the interest rate. There is no other material interest rate risk.
Fair values
The net fair values of financial assets and financial liabilities approximate their carrying value. The methods for estimating fair
value are outlined in the relevant notes to the financial statements.
37
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
20. EVENTS SUBSEQUENT TO BALANCE DATE
On 9 July 2019, the Company successfully executed a Tenement Sale Agreement to sell 100% of title and rights of Bulgera Gold
Project to Norwest Minerals Limited for a consideration of $200,000 consideration. The Bulgera Gold Project comprised of
Exploration Licenses E52/3316 and E52/3276. The Bulgera Project was non-core and the sale was part of the Company’s refocus
on long term growth opportunities.
There are no matters or circumstances that have arisen since 30 June 2018 to the date of this report that have significantly
affected, or may significantly affect the Company's operations, the results of those operations, or the Company's state of affairs
in future financial years.
21. CONTINGENT LIABILITIES AND ASSETS
There are no contingent liabilities or assets at 30 June 2019 (2018: nil).
38
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
DIRECTORS’ DECLARATION
For the year ended 30 June 2019
In the opinion of the Directors of Accelerate Resources Limited:
a)
b)
c)
The financial statements and notes set out on the preceding pages are in accordance with the Corporations Act 2001
including:
i
ii
giving a true and fair view of the financial position of the Company as at 30 June 2019 and of their performance for the
financial year ended on that date; and
complying with Australian Accounting Standards (including the Australian Accounting Interpretations), the
Corporations Regulations 2001 and other mandatory professional reporting requirements; and
There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable.
The financial statements and notes thereto are in accordance with International Financial Reporting Standards issued
by the International Accounting Standards Board.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of the Directors made pursuant to section 295(5)(a) of Corporations Act 2001.
Yaxi Zhan
Managing Director
30 September 2019
Perth
39
RSM Australia Partners
Level 32, Exchange Tower
2 The Esplanade Perth WA 6000
GPO Box R1253 Perth WA 6844
T +61 (0) 8 9261 9100
F +61 (0) 8 9261 9111
www.rsm.com.au
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
ACCELERATE RESOURCES LIMITED
Opinion
We have audited the financial report of Accelerate Resources Limited (the Company), which comprises the
statement of financial position as at 30 June 2019, the statement of comprehensive income, the statement of
changes in equity and the statement of cash flows for the year then ended, and notes to the financial statements,
including a summary of significant accounting policies, and the directors' declaration.
In our opinion, the accompanying financial report of the Company is in accordance with the Corporations Act
2001, including:
(i)
giving a true and fair view of the Company's financial position as at 30 June 2019 and of its financial
performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Company in accordance with the auditor independence requirements of
the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards
Board's APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor's
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
RSM Australia Pty Ltd is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent
accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Pty Ltd ACN 009 321 377 atf Birdanco Practice Trust ABN 65 319 382 479 trading as RSM
Liability limited by a scheme approved under Professional Standards Legislation
Material Uncertainty Related to Going Concern
We draw attention to Note 1, which indicates that the Company incurred a loss of $1,715,102 and had net cash
outflows from operating activities of $2,749,704 for the year ended 30 June 2019. As stated in Note 1, these
events or conditions, along with other matters as set forth in Note 1, indicate that a material uncertainty exists that
may cast significant doubt on the Company'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 this matter
Exploration and Evaluation Expenditure
Refer to Note 5 in the financial statements
The Company has capitalised exploration and
evaluation expenditure with a carrying value of
$3,279,957 as at 30 June 2019.
We considered this to be a key audit matter due to
the significant management judgments involved in
assessing the carrying value of the asset including:
finding
the basis on which
Determination of whether the expenditure can be
specific mineral
that
associated with
resources, and
expenditure is allocated to an area of interest;
Determination of whether exploration activities
have progressed to the stage at which the
recoverable
existence of an economically
mineral reserve may be assessed; and
Assessing whether any indicators of impairment
are present, and if so, judgments applied to
determine and quantify any impairment loss.
Our audit procedures included:
Mt Read - Area of Interest
Obtaining evidence that the Company has valid
rights to explore in the specific area of interest;
Reviewing and enquiring with management the
basis on which they have determined that the
exploration and evaluation of mineral resources has
the stage which permits a
not yet reached
reasonable assessment of
the existence or
otherwise of economically recoverable reserves;
Enquiring with management and reviewing budgets
and other documentation as evidence that active
and significant operations in, or relation to, the area
of interest will be continued in the future;
Agreeing a sample of additions to supporting
documentation and ensuring the amounts are
capital in nature and relate to the area of interest;
and
Critically assessing and evaluating management’s
impairment
indicators of
that no
assessment
existed.
Bulgera - Area of Interest
Obtaining evidence that the Company has valid
rights to the specific area of interest at the reporting
date;
Obtain documentation as evidence
the
Company was planning to sell this area of interest
prior to the reporting date; and
that
Evaluated
the
the
resulting recoverable value of the area of interest at
the reporting date.
impairment recognised and
Other Information
The directors are responsible for the other information. The other information comprises the information included
in the Company's annual report for the year ended 30 June 2019 but does not include the financial report and the
auditor's report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporation Act 2001 and for such internal
control as the directors determine is necessary to enable the preparation of the financial report that gives a true
and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Company to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no
realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar2.pdf. This
description forms part of our auditor's report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the directors' report for the year ended 30 June 2019.
In our opinion, the Remuneration Report of Accelerate Resources Limited, for the year ended 30 June 2019,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
RSM AUSTRALIA PARTNERS
Perth, WA
Dated: 30 September 2019
TUTU PHONG
Partner
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
ASX ADDITIONAL INFORMATION
Schedule of mining tenements held at the report date
Status
Location
Beneficial
Percentage
Interest
Project
Mt Read
Mt Read
Mt Read
Mt Read
Bulgera
Bulgera
Mount Monger
Mount Monger
Mount Monger
Comet
Comet
Tenement
Number
EL 6/2013
EL 7/2018
EL 8/2018
EL 9/2019
E52/3276
E52/3316
E25/525
E25/565
E25/586
E20/908
E20/939
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Tasmania
Tasmania
Tasmania
Tasmania
Western Australia
Western Australia
Western Australia
Western Australia
Application
Western Australia
Granted
Western Australia
Application
Western Australia
Sandstone
E57/1118
Application
Western Australia
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
44
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
ASX ADDITIONAL INFORMATION
Additional information required by the ASX Limited Listing Rules not disclosed elsewhere in this Annual Report is
set out below.
SHAREHOLDINGS
The issue capital of the Company at 20 September 2019 is 47,620,000 ordinary fully paid shares. All ordinary
shares carry one vote per share.
TOP 20 SHAREHOLDERS AS AT 20 SEPTEMBER 2019
No. of
Shares Held
% Held
YAXI ZHAN
1
2 GIBB RIVER DIAMONDS LIMITED
3 OURO PTY LTD
THYLACINE RESOURCES PTY LTD
4
5 GTT GLOBAL OPPORTUNITIES PTY LTD
6 OLI PRIVATE INVESTMENT PTY LTD
7
8 GRANT MOONEY
TERENCE TOPPING
9
MOUNTS BAY INVESTMENTS PTY LTD
10 SYRACUSE CAPITAL PTY LTD
11
12
KCIRTAP SECURITIES PTY LTD
MURDOCH CAPITAL PTY LTD
13 MR HAITAO ZHOU
14 MR YAN ZHANG
15 MRS HENG ZHANG
16
CORPORATE PROPERTY SERVICES PTY LTD
17 RATDOG PTY LTD
18 AOJIN GROUP PTY LTD
19 XIAOFANG CHEN
20 ANDEW HANS RUST
Shares Range
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
3,000,000
3,000,000
2,500,000
2,000,000
1,366,334
1,003,660
1,000,000
1,000,000
975,000
925,000
850,000
800,000
617,666
600,000
600,000
596,549
500,000
500,000
500,000
500,000
22,834,209
6.30
6.30
5.25
4.20
2.87
2.11
2.10
2.10
2.05
1.94
1.78
1.68
1.30
1.26
1.26
1.25
1.05
1.05
1.05
1.05
47.95
No. of Holders No. of Shares
2,861
143,244
840,715
10,699,084
35,934,096
47,620,000
10
36
93
253
80
472
Number holding less than a marketable parcel
144
1,040,920
Shareholders by Location
Australian holders
Overseas holders
VOTING RIGHTS
No. of Holders No. of Shares
47,568,000
52,000
47,620,000
470
2
472
The holders of ordinary shares are entitled to one vote per share at meetings of the Company.
45
A C C E L E R A T E R E S O U R C E S L I M I T E D
Annual Report for the year ended 30 June 2019
ASX ADDITIONAL INFORMATION
SUBSTANTIAL SHAREHOLDERS AS AT 20 SEPTEMBER 2019
YAXI ZHAN
GIBB RIVER DIAMONDS LIMITED
OURO PTY LTD
OPTION HOLDINGS
No. of
Shares Held
% Held
3,000,000
3,000,000
2,500,000
6.30
6.30
5.25
The Company has the following classes of options on issue at 20 September 2019 as detailed below. Options
do not carry any rights to vote.
Class
AX8OPT1
AX8OPT2
AX8OPT3
Unlisted
Options
Unlisted
Options
Unlisted
Options
Options Range
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Terms
No. of
Options
Exercisable at 0.25c expiring on or before 30 April 2021
10,000,000
Exercisable at 0.25c expiring on or before 14 February 2022
5,000,000
Exercisable at 0.25c expiring on or before 30 April 2020
200,000
15,200,000
Unlisted Options
No. of Holders
-
-
-
11
17
28
No. of
Options
-
-
-
600,000
14,600,000
15,200,000
The following Option holders hold more than 20% of a particular class of the Company’s Unlisted Options.
Holder
Thylacine Resources Pty Ltd
Mindalla Holding Pty Ltd
Robert Owen Reid
AX8OPT1 AX8OPT3
3,000,000
3,000,000
-
-
-
200,000
Consistency with business objectives - ASX Listing Rule 4.10.19
The Company states that it has not used the cash and assets in a form readily convertible to cash that it had
at the time of admission in a way consistent with its business objectives. The board adjusted its exploration
budget after considering the exploration results from Mt Read Project, to enable further work to be performed
on the Tasmanian Project.
46