Anglo Australian Resources NL
ABN 24 009 159 077
Annual Report
for the year ended 30 June 2017
1
CORPORATE DIRECTORY
ABN 24 009 159 077
Directors
John Jones (Executive Chairman)
Graeme Smith (Non-Executive Director)
Peter Stern (Non-Executive Director)
Company Secretary
Graeme Smith
Registered Office
Ground Floor
63 Hay Street
Subiaco WA 6008
Principal Place of Business
Ground Floor
63 Hay Street
Subiaco WA 6008
Telephone: +61 8 9382 8822
Facsimile: +61 8 6380 1904
Share Register
Security Transfer Registrars Pty Ltd
Suite 913, Exchange Tower
530 Little Collins Street
Melbourne VIC 3000
1300 992 916
registrar@securitytransfer.com.au
Auditors
Greenwich & Co Audit Pty Ltd
35 Outram Street
WEST PERTH WA 6005
Internet Address
www.anglo.com.au
Stock Exchange Listing
Anglo Australian Resources NL shares are listed on the Australian Securities Exchange (ASX code: AAR).
CONTENTS
Chairman’s Report
Review of Operations
Directors' Report
Auditor’s Independence Declaration
Corporate Governance Statement
Statement of Profit or Loss and Other Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors' Declaration
Independent Audit Report
ASX Additional Information
3
4
20
27
28
37
38
39
40
41
56
57
61
CHAIRMAN’S REPORT
Dear Shareholders,
This is my sixth Chairman’s Report since being re-appointed Chairman in 2011.
In the period since, sentiment towards the resources industry overall and Anglo Australian specifically has steadily
improved, leading me to state in my 2016 Chairman’s Report that, as far as our company was concerned, “…I sensed
cause for guarded optimism”.
Against this background, I am pleased to suggest that I believe there is cause for shareholders of Anglo Australian to
now be genuinely excited.
In August 2016, at our 100%-owned Feysville Gold Project, located as it is just 14 km to the south of and along strike
from the Super Pit, a 70+ million-ounce gold mine, a ground magnetic survey lead to us identifying the prominent ten
(or so) km long “Ethereal Shear Zone”.
Three aircore drilling campaigns during calendar 2017 primarily focussed on the southern end of the Shear
subsequently lead to us identifying the +1.6 km long “Think Big” prospect.
This, together with other prospects identified so far at Feysville including Rogan Josh, Dalray, Ethereal and Kamperman,
provides us with a host of attractive targets warranting further investigation in what we consider is an exploration
project of world class.
As I write, we have recently completed a reverse-circulation drilling campaign at Feysville encompassing 25 holes with
the focus on Think Big. Results are awaited.
Later this year, it is our intention to target deep mineralisation at Feysville by way of diamond drilling with funding
assistance to the amount of $100,000 provided by the Department of Mines and Petroleum, Western Australia under
an exploration incentive scheme.
In our 100%-owned Koongie Park Project in northern Western Australia, encompassing both gold and base metals
targets, we also have what we believe to be a very exciting opportunity.
As far as gold targets are concerned, we note that our nearest neighbour at Koongie Park, the ASX-listed Pantoro
Limited (market capitalisation of approximately $185 million), is building an excellent record of discovery as it pursues
targets along the very same geological structures that intersect our much more substantial ground position.
Moreover, with the price of both copper and zinc having increased significantly during the year, there is caused to
believe that our base metals resources at Koongie Park are such as to be capable of monetisation, one way or the
another, in the near term.
During the year, an aggregate of approximately $730,000 was raised through the issue of new shares to sophisticated
investors. Shares were also issued during the year as payment (or part payment) for drilling and other services, and
shares and options were issued in satisfaction of all Director’s fees.
A further capital raising since the end of the financial year of approximately $800,000 sees the company with the most
funds at its disposal since my re-appointment as Chairman and leaves us well-funded to undertake considerable
exploration activities moving forward.
I take this opportunity to sincerely thank shareholders for their loyal support, noting that a number of shareholders
have been with us for many years.
I also thank my fellow directors and all our consultants for their wonderful efforts. Like me, they believe we are
potentially building Anglo Australian to be something special.
Yours sincerely
John Jones
Executive Chairman
Anglo Australian Resources NL
3
REVIEW OF OPERATIONS
Anglo Australian Resources NL has five key
resources interests in gold and base metals,
primarily copper and zinc, all in Western Australia.
PROJECT
EXPLORATION STATUS
LOCATION
PROSPECTIVITY
Feysville Gold
Koongie Park Gold
and
Mineral Resources exist
numerous new targets identified
and drilling is underway
Many kilometers of under explored
shear zones but mapping, soils and
drilling are planned
Highly strategic, 14 kilometers
south of the Super Pit
Extremely high
Highly strategic
Very high
Mandilla Gold
East Mandilla Gold Resource and
underexplored
Non-strategic but close by the
Wattle Gold Mine
Modest
Koongie Park Base Metals
Indicated Mineral Resources and
underexplored
Leonora Base Metals
Significantly underexplored
Highly
numerous
existing
strategic,
VMS
with
targets
Very high
Strategic, along strike from
the Jaguar and Bentley Mines.
Modest
3
REVIEW OF OPERATIONS
FEYSVILLE GOLD PROJECT
Anglo Australian - 100% interest, including options over tenements
The Feysville Project is in Australia’s premier gold belt, just 14km south of the giant Golden Mile deposit
(70Moz) at Kalgoorlie. The belt extends for some 100km along a NNW strike, and takes in major gold deposits at
New Celebration (3Moz), some 10km south of Feysville, and the large St Ives field (+15Moz) 30-60km to the
south. Numerous other economic gold deposits have also been discovered.
4
REVIEW OF OPERATIONS
Gold deposits are contained within a major structural corridor centred on the Boulder Lefroy fault, which controls
regional uplift and folding of a lower sequence of mafic-ultramafic rocks (purple and green) surrounded by an
upper sequence of volcano-sediments (blue and yellow). Feysville contains the lower mafic-ultramafic sequence
of rocks in the core of the project area, with the Boulder Lefroy fault interpreted to pass along the western flank
of the project. Another major structure parallel to the Boulder Lefroy fault passes through the eastern side of the
project for some 10km, and hosts Feysville’s Rogan Josh and Dalray prospects.
In late 2016, a ground magnetic survey identified a new shear zone of more than 7km in length, referred to as
the Ethereal Shear Zone, which hosts a number of targets of interest.
During the course of 2017, the company conducted three aircore drilling campaigns at Feysville with the primary
focus being targets along the Ethereal Shear Zone.
Towards the southern end of the zone, the company has identified a coherent +1.6 km long anomalous +100 ppb
gold trend at the new “Think Big” prospect (refer yellow outline in map below). The trend encompasses a higher
grade +1 g/t Au core that runs for approximately 200 metres along strike, with maximum results of up to 3.57 g/t
Au (red outline).
A geologic map of the Think Big prospect is set out below.
5
REVIEW OF OPERATIONS
A reverse circulation drilling program to evaluate bedrock mineralisation at Think Big and other targets was
undertaken during the third quarter of 2017 with results expected shortly.
A photograph of drilling in the “swamp” at Think Big is set out below.
6
REVIEW OF OPERATIONS
A summary of key prospects identified at Feysville thus far is set out in the following table:
PROSPECT
COMMENT
Think Big
Rogan Josh
Kamperman
Dalray
Ethereal
•
•
Identified June 2017 through aircore drilling
Situated on Ethereal Shear Zone
• 1.6 km in length defined by 100 ppb gold contour
• Core of 800 m strike length and 100 to 200 m width defined by 200
ppb contour
•
First reverse circulation drilling recently completed with results
pending
• An at-surface target with a current size range of 300,000 to 350,000
tonnes @ 2.0 to 2.5 grams per tonne gold
• Open at depth and along strike
•
Further reverse circulation drilling is planned
• Best intercept 13 metres at 8.31 g/t Au from 24 metres to bottom of
hole
•
First reverse circulation drilling recently completed with results
pending
• Best intercept 6 metres at 9.08 g/t Au
•
Situated on Ethereal Shear Zone
• Best intercept 10 metres at 9.1 g/t Au and 6 metres at 9.76 g/t Au
7
REVIEW OF OPERATIONS
KOONGIE PARK GOLD AND BASE METALS PROJECT
Anglo Australian - 100% interest
Anglo Australian holds a portfolio of tenements prospective for gold and base metals approximately 20km to the
south west of Halls Creek in the Eastern Kimberley region of Western Australia.
The company has a substantial tenement position:
8
REVIEW OF OPERATIONS
Koongie Park Gold
Various tenements held by Anglo Australian are adjacent to the Nicholsons Gold Project owned by the ASX-listed
Pantoro Limited (refer blue tenement outline in map above), which is currently producing gold at a rate in the
order of 40,000 ounces per annum, though the company has plans to increase production to 80,000 ounces or
more through further expansion.
Located as they are close to the Pantoro operation, Anglo Australian’s leases are strategically located.
Ore is currently sourced from the Nicolsons Mine, where a recent resource of 720,000 tonnes at 7.41 g/t
containing 172,000 ounces of gold was reported.
The NNE-SSW trending Nicolsons Shear Zone on which the Nicolsons Mine is situated also hosts other gold
deposits held by Pantoro including Rowdies, Wagtail North and Wagtail South.
The Nicolsons Gold Project illustrates that mineralization is structurally controlled within a 400-metre-wide NNE
trending strike-slip shear zone adjacent to the northwest margin of the Lodestone Monzogranite. Host rocks
comprise folded and metamorphosed turbiditic greywackes, felsic volcaniclastics, mafic volcanic and laminated
siltstone and mudstone of the Koongie Park Formation. Mineralisation is strongly associated with discontinuous
quartz veining and iron-silica-potassium alteration.
The company’s ground position includes approximately 14km of the Nicolsons Shear Zone to the north of ground
held by Pantoro, which is yet to be drill tested.
Anglo Australian has identified a parallel shear zone to the east of the Nicolsons Shear Zone, known as the
Nicolsons East Shear Zone. Approximately 30km of Nicolsons East Shear Zone is within the company’s ground
position.
9
REVIEW OF OPERATIONS
Limited ground work has already identified a number of highly attractive targets, including the Nicolsons East
Prospect which outcrops over approximately a two-kilometre length and where a rock chip assay of 15.67 g/t Au
has previously been recorded.
Koongie Park Base Metals
Anglo Australian’s tenements at Koongie Park encompass more than 40kms of the Koongie Park Formation,
which is prospective for VMS-style base metal deposits.
Some 245 RC and diamond drill holes encompassing 50,0417m have been drilled on the project by Anglo
Australian. This effort focused on resource, metallurgical and Geotech drilling at two of the prospects, Sandiego
and Onedin, with mineralisation seeming to have accumulated in fold hinges.
A cross section through Sandiego is set out as follows:
10
REVIEW OF OPERATIONS
A summary of resources at Sandiego is set out in the following table:
Sandiego Deposit – Indicated and Inferred Mineral Resources
Supergene Copper: 370,000 tonnes @ 4.0 % Cu, 2.7% Zn, 48g/t Ag and 0.29g/t Au
Copper Zone: 1,140,000 tonnes @ 2.8% Cu, 1.5% Zn, 12g/t Ag and 0.43g/t Au
Zinc Zone:
1,220,000 tonnes @ 0.2 % Cu, 7.0% Zn, 26g/t Ag and 0.13g/t Au
Total Metal:
(ASX Release 13.06.13)
50,000 tonnes copper, 115,000 tonnes zinc, 2 million ounces of silver & 26,000 ounces of gold.
A cross section through Onedin is set out as follows:
11
REVIEW OF OPERATIONS
A summary of resources at Onedin is set out in the following table:
Onedin Deposit – Indicated and Inferred Mineral Resources
Zinc Zone: 1,980,000 tonnes @ 6.25% Zn, 0.47% Cu, 32g/t Ag and 0.3g/t Au
Copper Zone: 2,500,000 tonnes @ 1.1% Cu, 0.8% Zn, 21g/t Ag and 0.3g/t Au
Total Metal: 36,000 tonnes copper & 140,000 tonnes zinc metal
(ASX Release 13.06.13)
The Sandiego and Onedin mineralized zones represent fold hinges
Distribution of metal in rock strongly suggests that the metal has been remobilized (which explains the Sandiego
and Onedin accumulations)
Within the Koongie Park project area, airborne magnetics has identified a number of other potential hinge
structures that are yet to be drill-tested.
12
REVIEW OF OPERATIONS
MANDILLA GOLD PROJECT
Anglo Australian - 100% interest
Anglo Australian’s Mandilla Gold Project is located approximately 70km south of Kalgoorlie and 20km south east
of Kambalda.
Anglo Australian’s tenement holdings comprise two mining leases and an exploration lease.
13
REVIEW OF OPERATIONS
Geology in the project area consists of a sequence of mafic and ultramafic rocks in contact with felsic volcaniclastic
and sedimentary rocks of the Mandilla Formation. The sedimentary sequence is intruded by the Emu Rocks
Granite. The western contact of the granite is faulted by an interpreted southern extension of a splay fault of the
Zuleika Shear Zone, which hosts +1 million ounce deposits at Raleigh and Mt Marion.
Over the period 2006 to 2007, Anglo Australian achieved production of approximately 23,000 ounces of gold
from an open-cut palaeochannel.
At Mandilla East, the Company has identified a bed-rock gold Inferred Resource of 357,000 tonnes at 3.3 g/t Au
for approximately 38,000 contained ounces (ASX 13/06/13).
Along strike and down dip from Mandilla East, a number of gold intersections in rotary air blast (RAB) and aircore
(AC) drill holes previously completed by Anglo Australian contain anomalous gold zones, the most notable being
2 metres at 6.21 g/t Au. Three drill target areas south east from Mandilla East Gold resource require further
evaluation. All these targets lie on or proximal to parallel North-West trending regional structures near or on the
contact between felsic volcaniclastic sedimentary rocks and demagnetised granitoid rocks.
At West Mandilla, a target area is defined by a 700-metre-long soil anomaly defined by a > 20ppb gold contour.
Within the >20 ppb gold contour there are four discrete bullseye soil highs defined by a >50 ppb contour. A
traverse of RC holes, drilled across the central part of the soil anomaly, did not target the peak soil values and
intersected only low-grade gold mineralisation with a best value of 2 metres at 1.45 g/t Au from 63 metres depth
downhole. The zone, open to the northwest and southeast, lies within the northwest-southeast striking regional
fault corridor.
During the year a reconnaissance aircore drilling program undertaken to cover strike projection of Mandilla East
mineralization and bedrock gold mineralization delineated in air core and RC drilling to the south east.
28 holes were drilled for 1,525 meters.
Results are currently being interpreted.
LEONORA BASE METALS PROJECT
Anglo Australian - 100% interest
Anglo Australian’s Leonora Project comprises many Exploration Licenses located approximately 12 km to the
North of the township of Leonora.
The Project covering 12 kms of strike strategically located only 32 kms to the south of, and along strike from,
Independence Group Limited’s Teutonic Bore – Jaguar – Bentley mineralized VMS corridor.
These deposits, discovered by drill testing bedrock electromagnetic conductors, occur near the boundary between
mafic and felsic units.
Anglo Australian’s project would appear to host these felsic volcanic and sediments broadly analogous to the
geology at Jaguar and Bentley.
14
REVIEW OF OPERATIONS
Based on interpretation of previous aircore drilling and aeromagnetic data, Anglo Australian considers 7km of this
zone is highly prospective for VMS-style mineralisation.
As bedrock in the zone is mostly covered by younger transported sediments, the company has identified Moving
Loop Electromagnetic (MLEM) survey as its primary exploration tool to search for VMS deposits that are generally
highly conductive and amenable to location by such geophysical methods.
A MLEM survey completed in May 2011 at the Leonora Project targeting potential massive copper-zinc
mineralisation discovered a strong 800m long bedrock conductor. Sample spoils from previous aircore drilling
indicated that the conductor was located within favourable stratigraphy proximal to the contact between felsic
and mafic volcanic rocks. Preliminary interpretation of the MLEM anomaly by the company’s geophysical
consultants suggested the source of the conductor (potentially massive or disseminated sulphide) commenced at
the base of weathering approximately 100m below surface and dipped steeply south west. The conductor
presented an exciting and compelling drill target.
15
REVIEW OF OPERATIONS
Two diamond core holes were completed in October 2012 as extensions to the pre-collar holes completed in May.
Both diamond core holes intersected a sequence of mafic and felsic volcanic and volcaniclastic rocks with minor
non-volcanic units. Trace to minor amounts of disseminated sulphides consisting of chalcopyrite, pyrrhotite and
pyrite were observed in the core and a narrow zones of stringer chalcopyrite and pyrrhotite were intersected
within a foliated mafic intrusive in hole LRCD001. Anomalous copper and zinc values supported by weakly
anomalous values in antimony and tin were recorded in several of the intervals selected for assaying. The best
intersection comprised a 0.65 metre interval at 2.08% copper from 233.25 metres in hole LRCD001. Narrow zones
of black shale containing variable amounts of pyrite and pyrrhotite and minor amounts of chalcopyrite intersected
in both holes most likely explain the source of the MLEM conductor.
A downhole EM survey was subsequently undertaken on each hole to define and confirm the conductive zone.
Analysis suggests a strong off hole conductor possibly related to massive sulphides has been detected in both
holes.
Two diamond core drill holes targeted off-hole conductors detected by downhole electromagnetic (DHEM)
surveys in two holes drilled in October 2012. The program was completed under the WA Government co-funded
Exploration Incentive Scheme (EIS) in July 2014.
16
REVIEW OF OPERATIONS
The holes were located in the vicinity of the previous holes, but targeted the south plunging, west dipping DHEM
conductors offset from those holes. As with the previous holes trace to minor amounts of sulphide mineralisation
in the form of pyrrhotite, chalcopyrite and sphalertite were intersected with the best results being 1 metre at
0.3045% Cu from 367.5 metres in hole LDRC003 and 1 metre at 0.2337% Zn from 227.65 metres in hole LRCD004.
Drill logs and assays have yet to be reviewed with respect to the geophysical target.
Although assay results are low the extent of disseminated mineralisation (328.75metres to 436.03 metres in hole
LDRC003 and 221.31 metres to 283.00 metres in hole LDRC004) is encouraging. These widths of disseminated and
stringer sulphides suggest that the volcano-sedimentary pile within the tenement area is fertile and capable of
hosting a massive sulphide deposit.
Drill logs and assays are being reviewed with respect to the geophysical target to determine optimise targeting
for further drilling.
17
REVIEW OF OPERATIONS
Compliance Statement
Information in this Report relating to geological data has been compiled by David Otterman who is an independent consultant
from DW Otterman Exploration Consultant.
David Otterman, who is a consultant to Anglo Australian Resources NL:
• Has relevant experience in relation to the mineralisation being reported on as to qualify as a Competent Person as
defined by the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC
Code 2004 Edition);
•
Is a Fellow of the Australasian Institute of Mining and Metallurgy (CP Geo) and is a Member of the Australian Institute
of Geoscientists and has had more than thirty years experience in the field of activity reported herein; and
• Has consented in writing to the inclusion of this data.
Mineral resource information in relation to the Mandilla Project has been compiled by Andrew Bewsher an independent
consultant from BM Geological Services, based on work by Peter Komyshan (formerly General Manager Exploration for Anglo
Australian Resources NL) and BMGS geologists.
Andrew Bewsher is a member of the Australian Institute of Geoscientists and has more than five years relevant experience
in relation to the mineralisation being reported on as to qualify as a Competent Persons as defined by the Australasian Code
for Reporting Identified Mineral Resources and Ore Reserves.
Mineral Resources for the Sandiego Deposit, Koongie Park Project have been estimated by David Slater, BAppSc, DipEd,
MAusIMM, Specialist Consultant - Resources and Invar Kirchner, BSc(Hons), MAusIMM – Manager Resources with Coffey
Mining Pty Ltd. Perth, WA. Both consultants have more than five years relevant experience in relation to the mineralisation
being reported on to qualify as a Competent Person as defined by the Australasian Code for Reporting Identified Mineral
Resources and Ore Reserves.
Mineral Resources for the Onedin Deposit, Koongie Park Project have been estimated under the overall supervision and
direction of Gerry Fahey, MAusIMM and MAIG, of CSA Global. Participants included Peter Komyshan (geological
interpretation) and David Williams, MAusIMM (Mineral Resource estimate). Mr Komyshan, Mr Williams and Mr Fahey are
Competent Persons as defined by the Australasian Code for the Reporting of Exploration Results, Mineral Resources or Ore
Reserves (JORC Code 2004 Edition).
18
REVIEW OF OPERATIONS
SCHEDULE OF MINING TENEMENTS
Project
Tenement
Company Interest
Title Registered to
Western Australia
Koongie Park
Feysville
Mandilla
Leonora
M80/276, 277
E80/4389,4766,
4957, 4960
P80/1802-10
P80/1831-1837
P26/3942 – 3951
P26/4051- 4052
P26/4074 – 4077
M15/96
M15/633
E15/1404
E37/1047
P37/8355
E37/1287
100%
Anglo Australian Resources NL
100%
Anglo Australian Resources NL
100% gold rights only
100% gold rights only
100%
Apollo Phoneix Resources Pty Ltd
Anglo Australian Resources NL
Anglo Australian Resources NL
100%
Anglo Australian Resources NL
19
DIRECTORS’ REPORT
The Directors present their report together with the financial report of Anglo Australian Resources NL ("the
Company") for the year ended 30 June 2017 and the auditors' report thereon.
1. DIRECTORS
The Directors of the Company at any time during or since the end of the financial year are:
Name, qualifications, experience, special responsibilities and other directorships and independence
status
John Jones
Executive Chairman
Mr Jones is a well-known and respected mining identity who has been
associated with a number of successful mining corporations in his 43 years
of business. Mr Jones has been a director of the Company since February
1990, is a Kalgoorlie pastoralist and businessman formerly associated with
North Kalgurli Mines NL and was a founding director of Jones Mining
Limited. Mr Jones is a Non-Executive Director of Troy Resources Limited,
Image Resources NL and Tanga Resources Limited.
Interest in shares and
options
Shares – 22,352,177
Options - 16,200,000 - $0.02 exp 30/11/19
Options – 23,200,000 - $0.02 exp 30/11/20
Options – 4,980,000 - $0.025 exp 30/11/20
Options – 3,550,000 - $0.08 exp 30/11/20
Peter Stern
Non-Executive Director
Mr Stern is a graduate of Monash University with a Bachelor of Science
(geology major). Mr Stern’s career has been in corporate advisory,
spending six years with Macquarie Bank and three years with both UBS and
Deutsche Bank. In 2000, Mr Stern established Metropolis Pty Ltd, a
corporate advisory firm specializing in M&A and capital raisings. Mr Stern
is a Fellow of the Australian Institute of Company Directors. Mr Stern is
Non-Executive Chairman of Troy Resources Limited and Non-Executive
Director of Entek Energy Limited.
Interest in shares and
options
Shares – 4,706,252
Options - 6,100,000 - $0.02 exp 30/11/19
Options – 7,000,000 - $0.02 exp 30/11/20
Options – 2,000,000 - $0.025 exp 30/11/20
Options – 1,700,000 - $0.08 exp 30/11/20
Graeme Smith
Non-Executive Director
Mr Smith is a finance professional with over 25 years’ experience in
accounting and company administration. He graduated from Macquarie
University with a Bachelor of Economics degree and has since received a
Master of Business Administration and a Master of Commercial Law. He is
a Fellow of the Australian Society of Certified Practicing Accountants, the
Institute of Chartered Secretaries and Administrators and the Governance
Institute of Australia.
Mr Smith was previously a director of Surefire Resources NL.
Interest in shares and
options
Shares – 2,582,999
Options – 2,500,000 - $0.02 exp 30/11/19
Options – 7,000,000 - $0.02 exp 30/11/20
Options – 2,000,000 - $0.025 exp 30/11/20
Options –1,700,000 - $0.08 exp 30/11/20
2. COMPANY SECRETARY - Graeme Smith
20
DIRECTORS’ REPORT
3. DIRECTORS’ MEETINGS
The number of directors’ meetings held and number of meetings attended by each of the directors of
the Company during the financial year were:
Director
John Jones
Peter Stern
Graeme Smith
Director Meetings
Number Held
7
7
7
Number Attended
7
7
7
Audit
Committee
1
1
1
4. REMUNERATION REPORT - AUDITED
4.1
Principles of compensation
For the purpose of this report Key Management Personnel (“KMP”) are defined as those persons
having authority and responsibility for planning, directing and controlling the major activities of
the Company, directly or indirectly.
Based on this definition, the officers listed under Key Management Personnel below will be
included in the report. The report will also provide an explanation of the Company’s remuneration
policy and structure, details of remuneration paid to Key Management, (including directors), an
analysis of the relationship between company performance and executive remuneration
payments, and the key terms of executive employment contracts.
2017 Key Management Personnel:
John Jones
Peter Stern
Graeme Smith
Fixed Remuneration
Executive Chairman
Non-Executive Director
Non-Executive Director
Fixed remuneration – Fixed remuneration consists of base remuneration and statutory
superannuation entitlements. Remuneration levels are set by the Board based on individual
performance and the performance of the Company.
Performance Linked Remuneration
Due to the nature of the Company’s operations, i.e., mineral exploration, Directors and Executive
remuneration does not include performance-based incentives.
Options
The Board annually assesses the granting of any options to employees and executive directors
based on performance and according to the prevailing industry and market practices. No options
were granted during the year.
Non-executive Directors
Total remuneration for all non-executive directors during the year was $185,000 which included
options valued at $25,000. To date, directors’ fees have not been paid in cash by the Company.
The maximum shareholder approved remuneration is $200,000 per annum. Directors’ fees cover
all Board activities.
21
DIRECTORS’ REPORT
Relationship between Company performance and remuneration
The objective of the Company’s remuneration structure is to reward and incentivize the directors
and executives to ensure alignment with the interests of shareholders. The remuneration
structure also seeks to reward directors and executives for their contribution in a manner that is
appropriate for a company at this stage of its development. As outlined elsewhere in this Report,
the remuneration structure incorporates fixed component and options.
The key drivers of value for the Company: the acquisition and progression of exploration
properties to the point of commercial development or realization.
The only relevant financial measure at this point in the Company’s development is share price
for which history is presented below:
Closing share price at 30
June
2017
0.04
2016
0.012
2015
0.01
2014
0.01
2013
*0.03
2012
*0.06
* Share prices have been adjusted to reflect the cumulative dilution of the share capital
consolidation completed during December 2013.
Voting and Comments Made at the Company’s 2016 Annual General Meeting
The Company received approximately 99.9% of “yes” votes on its remuneration report for the
2016 financial year. The Company did not receive any specific feedback at the AGM on its
remuneration practices.
4.2 Key management personnel remuneration
The following table discloses the remuneration of the key management personnel of Anglo
Australian Resources NL.
Short-Term
Salary &
Fees –
Accrued
(A)
$
90,000
35,000
35,000
160,000
Salary &
Fees -
Non-Cash
(Options)
(B)
$
15,000
5,000
5,000
25,000
Post
Employment
Other
Share
Based
Payments
Total
Superannuation
$
-
-
-
-
$
-
-
-
-
$
105,000
40,000
40,000
185,000
2017
Directors
J L C Jones
P A Stern
G I Smith
Total
(A) Accrued fees represent director’s fees accrued from 1 July 2016 to 30 June 2017.
(B) As at 30 June 2016, directors were owed $80,000 in relation to remuneration. On 30 November 2016,
10.5 million options were granted to directors in lieu of outstanding directors fees. The options were
ascribed a value of $105,000 using the Black-Scholes model (Section 4.4 below). Of this amount,
$80,000 relates to remuneration incurred in the period ending 30 June 2016 and $25,000 relates to
the year to 30 June 2017.
(C) Nil amounts of the above remuneration is performance based.
22
DIRECTORS’ REPORT
Salary &
Fees
Non-Cash
Benefits
(Options)
(D)
Superannuation
Other
Share
Based
Payments
2016
$
$
Directors
J L C Jones
P A Stern
G I Smith (include secretarial
fees)
Total
50,000
15,000
15,000
35,840
10,900
10,900
80,000
57,640
$
-
-
-
-
$
-
-
-
-
$
85,840
25,900
25,900
137,640
(D) The 24.8 million options issued were ascribed a value of $202,665 using the Black Scholes Model. Of
this amount, $65,062 related to key management personal remuneration incurred in the year to 30
June 2016. The balance of the fair value settled amounts accrued in prior periods.
4.3
Service agreements
There are currently no service agreements in place with the directors.
4.4 Analysis of options over equity instruments granted as compensation during the year ended 30
June
Yr to 30 June 2017
Grant Date &
Vesting Date
Number
Granted (i)
Expiry Date
Exercise Price
(cents)
Value per option
at grant date
(cents)
Exercised
Number
% of
Remuneration
Directors
J L C Jones
P Stern
G I Smith
(i)
25/08/2016
25/08/2016
25/08/2016
6,500,000
30/11/2020
2,000,000
30/11/2020
2,000,000
30/11/2020
2.5
2.5
2.5
1.00
1.00
1.00
Nil
Nil
Nil
14%
13%
13%
As outlined above these options have been valued at $105,000. $80,000 of this value has been offset
against amounts owing to directors as at 30 June 2016. The inputs to the Black Scholes model were: Share
volatility of 149%; risk free rate of 1.62%; exercise date of 30.11.2020; share price at grant date of 1.2
cents; exercise price of 2.5 cents.
Grant Date &
Vesting Date
Number
Granted
Expiry Date
Exercise Price
(cents)
Value per option
at grant date
(cents)
Exercised
Number
% of
Remuneration
Year to 30 June
2016
Directors
J L C Jones
30/11/2015
23,200,000
30/11/2020
P Stern
G I Smith
30/11/2015
7,000,000
30/11/2020
30/11/2015
7,000,000
30/11/2020
2.0
2.0
2.0
0.37
0.37
0.37
Nil
Nil
Nil
41%
42%
42%
23
DIRECTORS’ REPORT
4.5
Equity instruments held by key management personnel
Share holdings
The movement during the reporting period in the number of ordinary shares in Anglo Australian
Resources NL held directly, indirectly or beneficially by each key management person, and
including their related parties is as follows:
Fully paid ordinary shares issued in Anglo Australian Resources NL
Balance at
1 July 2016
Granted as
Remuneration
No.
No.
Received on
Exercise of
Options
No.
Net Other
Change
No.
Balance at
30 June
2017
No.
Directors
J L C Jones
17,204,344
P A Stern
G I Smith
1,856,585
866,666
Option holdings
-
-
-
-
-
-
3,333,333
20,537,677
1,966,667
3,823,252
833,333
1,699,999
The movement during the reporting period in the number of options over ordinary shares in the
Company held, directly, indirectly or beneficially, by each key management personnel, including
their related parties, is as follows (all option numbers adjusted to reflect post-consolidation
balances):
Balance at
beginning of the
year
No.
Granted as
compensation
(A)
No.
Lapsed
Other
Changes
Balance at end
of the year
Vested and
exercisable
No.
No.
No.
No.
J L C Jones
39,400,000
6,500,000
P A Stern
G I Smith
13,100,000
2,000,000
9,500,000
2,000,000
-
-
-
(1,000,000)
44,900,000
44,900,000
-
-
15,100,000
15,100,000
11,500,000
11,500,000
(A) As at 30 June 2016, directors were owed $80,000 in relation to remuneration. On 30 November 2016,
10.5 million options were granted to directors in lieu of outstanding directors fees. The options were
ascribed a value of $105,000 using the Black-Scholes model (Section 4.4 above). Of this amount,
$80,000 relates to remuneration incurred in the period ending 30 June 2016 and $25,000 relates to
the year to 30 June 2017.
4.6 Other key management personnel transactions with Directors and Director-related entities
A number of key management persons, or their related parties, hold positions in other entities
that result in them having control or significant influence over the financial or operating policies
of those entities.
A number of these entities transacted with the Company or its subsidiaries in the reporting period.
24
DIRECTORS’ REPORT
The following fees were incurred on normal commercial terms and conditions to the following
Director related entities:
Related Parties
Transactions
Transactions Value
Amount owing by
the Company
30 June
2017
30 June
2016
30 June
2017
30 June
2016
$
$
$
$
(21,914)
303
1,976
23,890
(81,664)
(29,067)
-
81,664
(18,314)
256
-
-
2,164
823
20,478
567
32,658
8,799
54,254
21,596
36,468
36,468
-
-
J L C Jones – Westbury
Management Services Pty Ltd
J L C Jones
P A Stern
G I Smith
G I Smith – Wembley Corporate
Tanga Resources Limited
End of audited Remuneration Report
5. PRINCIPAL ACTIVITIES
Storage / Admin Services
expenses
Loan to the company net
of (repayments)
Loan, (repayments) &
interest
Loan to the company
Company Secretarial /
CFO fees
Rent,
Outgoing
Carpark
&
The principal activities of the Company during the financial year consisted of the continued exploration
of gold and base metals projects in Western Australia and Northern Territory. There has been no change
these activities during the financial year.
6. OPERATING AND FINANCIAL REVIEW
Overview of the Company
During the current year, the Company conducted exploration and tenement reviews. There was no
revenue for this year however the Company continued with the business activities of exploration and
evaluation of gold and base metals projects.
Shareholder Returns
The net loss of the Company for the financial year, after provision for income tax was $517,148 (2016
net loss: $393,790).
Review of Principal Businesses
A review of the operations for the financial year, together with prospects which form part of this report
are set out above.
7. EVENTS SUBSEQUENT TO REPORTING DATE
There have been no events subsequent to the reporting date, other than those mentioned elsewhere in
this report.
8.
LIKELY DEVELOPMENTS
The Company intends to continue its exploration and evaluation programs on existing tenements and
to acquire further suitable tenements for exploration.
25
DIRECTORS’ REPORT
9. SHARE OPTIONS
Unissued Shares under Options
Unissued ordinary shares of Anglo Australian Resources NL under option at the date of this report
are as follows:
Expiry date
30 November 2019
30 November 2020
30 November 2020
30 November 2020
30 November 2020
Exercise price (cents)
2
2
2.5
4.0
8.0
Number of options
32,300,000
37,200,000
10,500,000
3,000,000
8,950,000
Total number of options outstanding at the date of this report
91,950,000
No option holder has any right under the options to participate in any other share issue of the Company or
any other entity.
10. INDEMNIFICATION AND INSURANCE OF OFFICERS AND AUDITORS
Indemnification
The Company has agreed to indemnify the following current directors of the Company, J L C Jones, G I
Smith and P A Stern against all liabilities to another person (other than the Company or related body
corporate) that may arise from their position as officers of the Company, except where the liability arises
out of conduct involving lack of good faith. The agreement stipulates that the Company will meet the
full amount of any such liabilities, including costs and expenses.
The Company has not entered into an agreement with their current auditors, Greenwich & Co Audit Pty
Ltd, indemnifying them against any claims by third parties arising from their report on the annual
financial report.
11. NON-AUDIT SERVICES
Details of amounts payable to the Auditor for non-audit services and audit services paid during the year
are set out in Note 19.
12. LEAD AUDITOR’S INDEPENDENCE DECLARATION
The lead auditor’s independence declaration is set out on page 27 and forms part of the directors’ report
for the financial year ended 30 June 2017.
Signed in accordance with a resolution of the Directors.
John Jones
Executive Chairman
Anglo Australian Resources NL
Dated at Perth this 30th day of September 2017.
26
CORPORATE GOVERNANCE STATEMENT
CORPORATE GOVERNANCE STATEMENT
The Board of Directors of Anglo Australian Resources NL is responsible for the corporate governance of
the consolidated entity. The Board guides and monitors the business and affairs of Anglo Australian
Resources NL on behalf of the shareholders by whom they are elected and to whom they are
accountable.
Anglo Australian Resources NL’s corporate governance practices were in place throughout the year
ended 30 June 2017 and were compliant with the ASX Governing Council’s best practice
recommendations, unless otherwise stated.
Information on Corporate Governance
www.anglo.com.au/investors.
is
available on
the Company’s website
at
In fulfilling its obligations and responsibilities to its various stakeholders, the Board of directors of the
Company advocates the adoption of and adherence to a framework of rules, relationships, systems and
processes within and by which authority is exercised and controlled within the corporation – this is what
is meant in this manual when reference is made to corporate governance. This manual outlines the
Company’s principal corporate governance procedures. The Board supports a system of corporate
governance to ensure that the management of the Company is conducted in a manner which is directed
at achieving the Company’s objectives in a proper and ethical manner.
Except to the extent indicated herein, the Company has resolved that for so long as it is admitted to the
official lists of the ASX it shall abide by the ASX Recommendations.
Due to the exigencies and vagaries of commercial life and changing circumstances, there will, no doubt,
be occasions when, especially because of the size of the Company and the composition of its Board, that
it can be expected to depart from the policies and charters which it has adopted. These policies have
been adopted on the basis that, in the circumstances of the Company, they reflect what is considered
to reflect a reasonable aspiration. It is not expected that these guidelines will be slavishly adhered to.
Their object is to focus attention upon the issues they address and provoke thought about and
awareness of those issues and the pitfalls that one could otherwise fall into inadvertently. The important
thing is to develop a culture conducive only to good and appropriate conduct and practices.
Honesty and integrity must be the overriding and guiding principle in all things- substance must prevail
over form and lip service. Adhering to the following policies is a condition of each contract of
employment or service.
The Board encourages all key management personnel, other employees, contractors and other
stakeholders to monitor compliance with this Corporate Governance manual and periodically, by liaising
with the Board, management and staff; especially in relation to observable departures from the intent
of hereof and with and any ideas or suggestions for improvement.
28
CORPORATE GOVERNANCE STATEMENT
PRINCIPLE 1 – LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT
1.1
1.2
1.3
1.4
1.5
A listed entity should disclose:
(a)
(b)
the respective roles and responsibilities of its board and management; and
those matters expressly reserved to the board and those delegated to
management.
A listed entity should:
(a) undertake appropriate checks before appointing a person, or putting forward
to security holders a candidate for election, as a director; and
(b) provide security holders with all material information in its possession relevant
to a decision on whether or not to elect or re-elect a director.
Information about the respective roles and responsibilities of our Board and
management (including those matters expressly reserved to the Board and
those delegated to management) is found under the Board Charter.
The appointment of directors is undertaken under by the whole Board
The Board recognises the benefits arising from diversity and aims to promote
an environment conducive to the appointment of well qualified Board candidates
so that there is appropriate diversity to maximise the achievement of corporate
goals.
As required under the ASX Listing Rules and the Corporations Act, election or
re-election of directors is a resolution put to members at each Annual General
Meeting. The notice of meeting contains all material information relevant to a
decision on whether or not to elect or re-elect a director.
A listed entity should have a written agreement with each director and senior
executive setting out the terms of their appointment.
The Company does not have any senior executives and it does not have
agreements with each director.
The company secretary of a listed entity should be accountable directly to the
board, through the chair, on all matters to do with the proper functioning of the
board.
The company secretary reports directly to the Board through the Chairman and
is accessible to all directors. The function performed by the company
secretary is noted in the letter of appointment of the company secretary
A listed entity should:
(a) have a diversity policy which includes requirements for the board or a relevant
committee of the board to set measurable objectives for achieving gender
diversity and to assess annually both the objectives and the entity’s progress in
achieving them;
(b) disclose that policy or a summary of it; and
(c)
disclose as at the end of each reporting period the measurable objectives for
achieving gender diversity set by the board or a relevant committee of the board
in accordance with the entity’s diversity policy and its progress towards
achieving them and either:
(1) the respective proportions of men and women on the board, in senior
executive positions and across the whole organisation (including how the
entity has defined “senior executive” for these purposes); or
(2) if the entity is a “relevant employer” under the Workplace Gender Equality
Act, the entity’s most recent “Gender Equality Indicators”, as defined in and
published under that Act.
The Company has a Diversity policy which can be found on its website under
the Corporate Governance section. The Company’s Diversity policy does not
include requirements for the board to set measurable objectives for achieving
gender diversity and given the size and nature of the Company at this stage,
the Board considers this course of action reasonable.
The Company recognises that a diverse and talented workforce is a
competitive advantage and that the Company’s success is the result of the
quality and skills of our people. Our policy is to recruit and manage based on
qualification for the position and performance, regardless of gender, age,
nationality, race, religious beliefs, cultural background, sexuality or physical
ability. It is essential that the Company employs the appropriate person for
each job and that each person strives for a high level of performance.
The Company has not set measurable objectives for achieving gender diversity
during the reporting period of 2016 – 2017.
There are no women on the Board.
29
CORPORATE GOVERNANCE STATEMENT
1.6
A listed entity should:
(a) have and disclose a process for periodically evaluating the performance of the
board, its committees and individual directors; and
(b) disclose, in relation to each reporting period, whether a performance
evaluation was undertaken in the reporting period in accordance with that
process.
1.7
A listed entity should:
(a) have and disclose a process for periodically evaluating the performance of its
senior executives; and
(b) disclose, in relation to each reporting period, whether a performance
evaluation was undertaken in the reporting period in accordance with that
process.
Process for Evaluating Board Performance is detailed in the Board Charter.
Information on Performance Evaluations is included in the remuneration report
section of the Annual Report.
The Company does not have any executives and therefore does not have a
process for evaluating the performance of senior executives. Given the size
and nature of the Company, the board considers this to be reasonable in the
circumstances. However, the board will re-evaluate senior executive
performance evaluation measures should the Company’s circumstances
change.
30
CORPORATE GOVERNANCE STATEMENT
PRINCIPLE 2 - STRUCTURE THE BOARD TO ADD VALUE
2.1
The board of a listed entity should:
(a) have a nomination committee which:
(1) has at least three members, a majority of whom are independent directors;
and
(2) is chaired by an independent director,
and disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the number of times the committee
met throughout the period and the individual attendances of the members
at those meetings; or
(b)
if it does not have a nomination committee, disclose that fact and the
processes it employs to address board succession issues and to ensure that
the board has the appropriate balance of skills, knowledge, experience,
independence and diversity to enable it to discharge its duties and
responsibilities effectively.
2.2
A listed entity should have and disclose a board skills matrix setting out the mix of
skills and diversity that the board currently has or is looking to achieve in its
membership.
The Board does not have a Nomination Committee.
The Board considers it has an appropriate balance of skills, knowledge,
experience, independence and diversity to enable it to discharge its duties
and responsibilities effectively. Board succession issues are discussed by
the whole Board when required.
The Board has identified that the appropriate mix of skills and diversity required
of its members on the Board to operate effectively and efficiently is achieved by
directors having substantial skills and experience in operational management,
exploration and geology, corporate law, finance, listed resource companies,
equity markets.
The Board Skills matrix for the current Board is as follows:
operational management
exploration and geology
corporate law
accounting & finance
listed resource companies
equity markets
John
Jones
-
-
Peter
Stern
Graeme
Smith
-
31
CORPORATE GOVERNANCE STATEMENT
2.3
2.4
2.5
2.6
A listed entity should disclose:
(a)
the names of the directors considered by the board to be independent
directors;
if a director has an interest, position, association or relationship of the type
described in Box 2.3 but the board is of the opinion that it does not
compromise the independence of the director, the nature of the interest,
position, association or relationship in question and an explanation of why the
board is of that opinion; and
the length of service of each director.
(b)
(c)
The Company considers that Peter Stern and Graeme Smith are independent
directors.
John Jones is a substantial shareholder of the Company and therefore non-
independent.
Although Graeme Smith provides services, as the Principal of Wembley
Corporate Services, as Company Secretary, the board considers that this does
not interfere, or might reasonably be seen to interfere, with his capacity to bring
an independent judgement to bear on issues before the board and to act in the
best interests of the entity and its security holders generally.
John Jones has been a director since 9 Feb 1990.
Peter Stern has been a director since 28 Nov 2011.
Graeme Smith has been a director since 18 Mar 2014.
A majority of the board of a listed entity should be independent directors.
The majority of the board are not independent directors.
The chair of the board of a listed entity should be an independent director and, in
particular, should not be the same person as the CEO of the entity.
The Chairman is not an independent director. The Board believes the
Chairman is the most suitable director to undertake this role. The Company
does not have a CEO.
A listed entity should have a program for inducting new directors and provide
appropriate professional development opportunities for directors to develop and
maintain the skills and knowledge needed to perform their role as directors effectively.
The Company will provide induction material for any new directors and,
depending on specific requirements, will provide appropriate professional
development opportunities for directors.
PRINCIPLE 3 – ACT ETHICALLY AND RESPONSIBLY
3.1
A listed entity should:
(a) have a code of conduct for its directors, senior executives and employees; and
(b) disclose that code or a summary of it.
Code of Conduct sets out the principles and standards which the Board,
management and employees of the Company are encouraged to strive to
abide by when dealing with each other, shareholders and the broad community
32
CORPORATE GOVERNANCE STATEMENT
PRINCIPLE 4 – SAFEGUARD INTEGRITY IN CORPORATE REPORTING
4.1
The board of a listed entity should:
(a) have an audit committee which:
(1) has at least three members, all of whom are non-executive directors and a
majority of whom are independent directors; and
(2) is chaired by an independent director, who is not the chair of the board,
and disclose:
(3) the charter of the committee;
(4) the relevant qualifications and experience of the members of the
committee; and
(5) in relation to each reporting period, the number of times the committee met
throughout the period and the individual attendances of the members at
those meetings; or
(b)
if it does not have an audit committee, disclose that fact and the processes it
employs that independently verify and safeguard the integrity of its corporate
reporting, including the processes for the appointment and removal of the
external auditor and the rotation of the audit engagement partner.
The board of a listed entity should, before it approves the entity’s financial
statements for a financial period, receive from its CEO and CFO a declaration that,
in their opinion, the financial records of the entity have been properly maintained
and that the financial statements comply with the appropriate accounting standards
and give a true and fair view of the financial position and performance of the entity
and that the opinion has been formed on the basis of a sound system of risk
management and internal control which is operating effectively.
A listed entity that has an AGM should ensure that its external auditor attends its
AGM and is available to answer questions from security holders relevant to the
audit.
4.2
4.3
The Company’s Audit committee comprises all directors and is Chaired by
Peter Stern.
The Audit Committee charter is disclosed on the Company’s website under the
Corporate Governance link
Qualifications and experience of members of the Audit Committee are found
under the directors’ profile in both the Annual report and on the Company’s
website at Directors and Management
Details of meetings of the audit committee are to be found in the Annual report
of the company.
The Company does not have a CEO but the Audit committee receives from its
CFO (Graeme Smith), declarations in relation to full year and half year
statutory financial reports during the reporting period in accordance with
section 295A of the Corporations Act.
The audit engagement partner attends the AGM and is available to answer
shareholder questions from shareholders relevant to the audit.
33
CORPORATE GOVERNANCE STATEMENT
PRINCIPLE 5 – MAKE TIMELY AND BALANCED DISCLOSURE
5.1
A listed entity should:
(a) have a written policy for complying with its continuous disclosure obligations
under the Listing Rules; and
(b) disclose that policy or a summary of it.
PRINCIPLE 6 – RESPECT THE RIGHTS OF SECURITY HOLDERS
6.1
A listed entity should provide information about itself and its governance to investors
via its website.
6.2
6.3
A listed entity should design and implement an investor relations program to
facilitate effective two-way communication with investors.
A listed entity should disclose the policies and processes it has in place to facilitate
and encourage participation at meetings of security holders.
6.4
A listed entity should give security holders the option to receive communications
from, and send communications to, the entity and its security registry electronically.
The Company’s continuous Disclosure Policy can be found under the
Corporate Governance section of the Company’s website
The Company’s website provides information on the Company including its
background, objectives, projects and contact details. The Corporate
Governance page provides access to key policies, procedures and charters of
the Company, such as the Board and Committee charters, securities trading
policy, diversity policy and the latest Corporate Governance Statement.
ASX announcements, Company reports and presentations are uploaded to the
website following release to the ASX and editorial content is updated on a
regular basis.
A Shareholder Communication Policy can be found on the Company’s website
The Company encourages shareholders to attend all general meetings of the
Company and sets the time and place of each meeting to promote maximum
attendance by Shareholders.
The Company encourages Shareholders to submit questions in advance of a
general meeting, and for the responses to these questions to addressed through
disclosure relating to that meeting.
The Company’s Shareholder Communication Policy is disclosed on the
Company’s website.
is
the Company’s desire
It
that shareholders receive communications
electronically in the interests of the environment and constraining costs. In an
endeavor to drive this objective the Company has a policy of providing hard
materials at least cost (which will generally involve a black & white presentation
even where the electronic version is full colour).
34
CORPORATE GOVERNANCE STATEMENT
PRINCIPLE 7 – RECOGNISE AND MANAGE RISK
7.1
The board of a listed entity should:
(a) have a committee or committees to oversee risk, each of which:
(1) has at least three members, a majority of whom are independent directors;
and
(2) is chaired by an independent director,
and disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the number of times the committee
met throughout the period and the individual attendances of the members
at those meetings; or
(b)
if it does not have a risk committee or committees that satisfy (a) above,
disclose that fact and the processes it employs for overseeing the entity’s risk
management framework.
The board or a committee of the board should:
(a)
review the entity’s risk management framework at least annually to satisfy
itself that it continues to be sound; and
(b) disclose, in relation to each reporting period, whether such a review has taken
place.
A listed entity should disclose:
(a)
(b)
if it has an internal audit function, how the function is structured and what role it
performs; or
if it does not have an internal audit function, that fact and the processes it
employs for evaluating and continually improving the effectiveness of its risk
management and internal control processes.
A listed entity should disclose whether it has any material exposure to economic,
environmental and social sustainability risks and, if it does, how it manages or
intends to manage those risks.
7.2
7.3
7.4
The Board has not established a Risk committee however it does have a Risk
Policy which can be found on the company’s website.
Risk management is specifically discussed at the Company’s board meetings
during the year.
The Company reviews its risk management framework annually and this
information is disclosed in the Annual Report.
The size and operations of the company do not warrant an internal audit
committee.
The Company’s external auditor advises the Company at each end of year and
half year whether there are any issues with internal control and improvements
which could be undertaken to improve them.
The Company is subject to, and responsible for, existing environmental
liabilities associated with its tenements. The Company will continually monitor
its ongoing environmental obligations and risks, and implement rehabilitation
and corrective actions as appropriate to remain compliant. These risks may be
impacted by change in Government policy.
The Company does not believe it has any significant exposure to economic
and social sustainability risks.
35
CORPORATE GOVERNANCE STATEMENT
PRINCIPLE 8 – REMUNERATE FAIRLY AND RESPONSIBLY
8.1
The board of a listed entity should:
(a) have a remuneration committee which:
(1) has at least three members, a majority of whom are independent directors;
and
(2) is chaired by an independent director,
and disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the number of times the committee
met throughout the period and the individual attendances of the members
at those meetings; or
(b)
if it does not have a remuneration committee, disclose that fact and the
processes it employs for setting the level and composition of remuneration for
directors and senior executives and ensuring that such remuneration is
appropriate and not excessive.
A listed entity should separately disclose its policies and practices regarding the
remuneration of non-executive directors and the remuneration of executive directors
and other senior executives.
A listed entity which has an equity-based remuneration scheme should:
(a) have a policy on whether participants are permitted to enter into transactions
(whether through the use of derivatives or otherwise) which limit the economic
risk of participating in the scheme; and
(b) disclose that policy or a summary of it.
8.2
8.3
The Company does not have a Remuneration committee as the Company
does not have any staff.
The whole board considers the level and composition of remuneration for
directors with reference to remuneration levels set by its peers in the mining
industry.
Non-executive directors are paid amounts equivalent to the remuneration
received by other non-executive directors working in similarly sized exploration
companies.
The Company does not have any staff and no need for a policy on
remuneration of executives.
The Company does not have an equity based remuneration scheme.
36
ANGLO AUSTRALIAN RESOURCES N.L.
A.C.N. 009 159 077
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
For the Year Ended 30 June 2017
Note
2017
$
2016
$
Interest income
Consultancy expenses
Exploration expenditure written off
Impairment expense
Directors’ fees
Depreciation and amortisation expenses
Rental expense
Share based payments
Interest expenses
Other expenses
Loss before tax
Income tax expense
Loss for the year
Total comprehensive loss for the year
attributable to equity holders of the Company
Loss per share:
Basic and diluted loss per share
9
15
8
15
16
15,431
-
(1,296)
(18,103)
(185,000)
-
(99,674)
(43,000)
(1,942)
(183,564)
(517,148)
11
-
-
-
(137,640)
(2,515)
(100,687)
-
-
(152,959)
(393,790)
-
-
(517,148)
(393,790)
(517,148)
(393,790)
17(i)
(0.22 cents)
(0.23 cents)
The above Statement of Profit or Loss and Other Comprehensive Income is to be read in conjunction with the
accompanying notes.
37
ANGLO AUSTRALIAN RESOURCES N.L.
A.C.N. 009 159 077
STATEMENT OF FINANCIAL POSITION
As at 30 June 2017
Assets
Cash and cash equivalents
Other receivables
Total Current Assets
Other receivables
Property, plant & equipment
Exploration and evaluation assets
Total Non-Current Assets
Total Assets
Liabilities
Trade and other payables
Borrowings
Total Current Liabilities
Rehabilitation provision
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Note
18(i)
7
7
8
9
10
11
12
2017
$
178,786
27,660
206,446
38,000
-
2,230,612
2,268,612
2,475,058
521,577
2,987
524,564
65,220
65,220
589,784
2016
$
279,415
8,609
288,024
38,000
-
1,672,004
1,710,004
1,998,028
419,499
102,708
522,207
65,220
65,220
587,427
1,885,274
1,410,601
13
14(a)
14(b)
30,057,224
717,770
(28,889,720)
29,213,403
569,770
(28,372,572)
Total equity attributable to the equity holders of
the Company
1,885,274
1,410,601
The above Statement of Financial Position is to be read in conjunction with the accompanying notes.
38
ANGLO AUSTRALIAN RESOURCES N.L.
A.C.N. 009 159 077
STATEMENT OF CHANGES IN EQUITY
For the Year Ended 30 June 2017
Opening Balance at 1 July 2015
Total comprehensive loss for the period
Loss for the period
Total comprehensive loss for the period
Transactions with owners, recorded directly
in equity
Issue of ordinary shares
Options issued to directors
Closing balance at 30 June 2016
Opening Balance at 1 July 2016
Total comprehensive loss for the period
Loss for the period
Total comprehensive loss for the period
Transactions with owners, recorded directly
in equity
Issue of ordinary shares
Options issued
Closing balance at 30 June 2017
Issued
Capital
$
28,668,168
Share based
Payments
Reserve
$
432,130
Accumulated
losses
Total Equity
$
$
(27,978,782)
1,121,516
-
-
-
-
(393,790)
(393,790)
(393,790)
(393,790)
545,235
-
29,213,403
-
137,640
569,770
-
-
(28,372,572)
545,235
137,640
1,410,601
29,213,403
569,770
(28,372,572)
1,410,601
-
-
-
-
(517,148)
(517,148)
(517,148)
(517,148)
843,821
-
30,057,224
-
148,000
717,770
-
-
(28,889,720)
843,821
148,000
1,885,274
The Statement of Changes in Equity is to be read in conjunction with the accompanying notes.
39
ANGLO AUSTRALIAN RESOURCES N.L.
A.C.N. 009 159 077
STATEMENT OF CASH FLOWS
For the Year Ended 30 June 2017
Note
2017
$
2016
$
Cash Flows from Operating Activities
Cash payments to suppliers and employees
Other revenue
Net cash used in operating activities
18(ii)
(230,565)
-
(230,565)
1,033
(555,485)
-
-
(554,452)
30,000
(71,664)
726,052
684,388
(100,629)
279,415
(238,148)
-
(238,148)
11
(202,922)
-
-
(202,911)
361,615
(415,682)
533,240
479,173
38,114
241,301
Cash Flows from Investing Activities
Interest received
Exploration and evaluation expenditure incurred
Proceeds from sale of property, plant &
equipment
Payments for property, plant & equipment
Net cash used in investing activities
Cash Flows from Financing Activities
Proceeds from borrowings
Repayment of borrowings
Proceeds from issue of shares (net of costs)
Net cash from financing activities
Net (decrease) / increase in cash and cash
equivalent
Cash and cash equivalents at the beginning of
the financial year
Cash and cash equivalents at the end of the
financial year
18(i)
178,786
279,415
The above Statement of Cash Flows is to be read in conjunction with the accompanying notes.
40
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
A.C.N. 009 159 077
1.
REPORTING ENTITY
Anglo Australian Resources NL (the “Company”) is a for profit company domiciled in Australia. The address of
the Company’s registered office is Ground Floor, 63 Hay Street, Subiaco, Western Australia. The Company is
involved in the exploration of mineral tenements.
2.
BASIS OF PREPARATION
(a) Statement of compliance
The financial report is a general purpose financial report which has been prepared in accordance with
Australian Accounting Standards (AASBs) adopted by the Australian Accounting Standards Board (AASB)
and the Corporations Act 2001. The financial report also complies with International Financial Reporting
Standards (IFRSs) adopted by the International Accounting Standards Board (IASB).
The financial reports were approved by the Board of Directors on 30 September 2017.
(b) New and amended standards adopted by the Company
The Company has adopted all the new and revised Standards and Interpretations issued by the AASB
that are relevant to their operations and effective for the current annual reporting period.
The adoption of all the new and revised Standards and Interpretations has not resulted in any changes
to the Company’s accounting policies and has no effect on the amounts reported for the current or prior
years.
(c) Basis of measurement
The financial reports have been prepared on the historical cost basis, except for share based payments
measured at fair value.
(d) Functional and presentation currency
These financial reports are presented in Australian dollars, which is the Company’s functional currency.
(e) Use of estimates and judgements
The preparation of financial reports in conformity with AASBs requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported amounts of
assets and liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an on-going basis. Revisions in accounting
estimates are recognised in the period in which the estimates are revised and in any future periods
affected.
In preparing this financial report, the significant judgements made by management in applying the
Company’s accounting policies and the key sources of estimation uncertainty are as follows.
(i) Measurement of Share Based Payments
From time to time, the Company grants options to key management people in lieu of services received.
Options granted are measured using a Black Scholes model that incorporates various estimates and
assumptions, including estimated future share price volatility.
(ii) Impairment of exploration and evaluation assets
The ultimate recoupment of the value of exploration and evaluation assets is dependent on successful
development and commercial exploitation, or alternatively, sale, of the underlying mineral exploration
properties. The Company undertakes at least on an annual basis, a comprehensive review for indicators of
impairment of these assets. Where impairment indictors are noted, there is significant estimation and
judgement in determining the inputs and assumptions used in determining the recoverable amounts.
The key area of estimation and judgement that is considered in this is the Company’s market capitalisation
compared to its net assets
41
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
2.
BASIS OF PREPARATION (continued)
(e)
Use of estimates and judgements(continued)
(iii) Going concern
A.C.N. 009 159 077
A key assumption underlying the preparation of the financial statements is that the Company will
continue as a going concern.
A Company is a going concern when it is considered to be able to pay its debts as and when they are
due, and to continue in operation without any intention or necessity to liquidate or otherwise wind up
its operations. A significant amount of judgment has been required in assessing whether the entity is a
going concern as set out in Note 3.
(iv) Provision for environmental rehabilitation
Included in liabilities at the end of each reporting period is an amount that represents an estimate of
the cost to rehabilitate the land upon which the Company has carried out its exploration for mineral
resources. Provisions are measured at the present value of management's best estimate of the costs
required to settle the obligation at the end of the reporting period. Actual costs incurred in future
periods to settle these obligations could differ materially from these estimates. Additionally, future
changes to environmental laws and regulations, life of mine estimates, and discount rates could affect
the carrying amount of this provision.
3. GOING CONCERN
The financial report has been prepared on the going concern basis that contemplates the continuity of normal
business activities and the realisation and extinguishment of liabilities in the ordinary course of business. For
the year ended 30 June 2017 the Company incurred a loss of $517,148 (2016: $393,790). The Company had net
cash outflows from operations of $230,565 (2016: $238,148), and net cash outflows from investing activities of
$554,452 (2016: $202,911).
The Company will require further funding in order to meet day-to-day obligations as they fall due and to progress
its exploration and evaluation projects as budgeted. The Company has a history of successful capital raisings to
fund exploration. The Board of Directors is aware, of the Company’s working capital requirements and the need
to access additional funding. The ability of the Company to continue as a going concern is dependent on the
Company securing further working capital by the issue of additional equity.
The Board of Directors have reviewed the business outlook and is of the opinion that the use of the going
concern basis of accounting is appropriate as they believe the Company will achieve the matters set out above.
Should the Company be unsuccessful in raising equity as required, there would be 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 financial report does not include any adjustments relating to the recoverability and
classification of recorded asset amounts nor to the amounts and classification of liabilities that may be necessary
should the Company be unable to continue as a going concern.
4.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
(a) Property, Plant and Equipment
(i) Recognition and measurement
Items of property, plant and equipment are measured at cost less accumulated depreciation and
amortisation (see below), and impairment losses (see accounting policy (e)).
Cost includes expenditures that are directly attributable to the acquisition of the asset. Where
parts of an item of property, plant and equipment have different useful lives, they are accounted
for as separate items of property, plant and equipment.
42
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
A.C.N. 009 159 077
4. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(a) Property, Plant and Equipment (continued)
(ii) Subsequent costs
The Company recognises in the carrying amount of an item of property, plant and equipment the
cost of replacing part of such an item when that cost is incurred if it is probable that the future
economic benefits embodied within the item will flow to the entity and the cost of the item can be
measured reliably. The carrying amount of the replaced part is derecognised. All other costs are
recognised in the statement of profit or loss and other comprehensive income as an expense as
incurred.
(iii) Depreciation
With the exception of mine property, depreciation is charged to the income statement on a
straight-line basis over the estimated useful lives of each part of an item of property, plant and
equipment.
Depreciation rates and methods and any residual values are reviewed annually for
appropriateness. When changes are made, adjustments are reflected prospectively in current and
future periods only. Depreciation is charged to the statement of comprehensive income.
(b) Exploration and Evaluation Expenditure
Exploration and evaluation costs, including the costs of acquiring licences and directors and, where
appropriate, management’s time are capitalised as exploration and evaluation assets on an area of
interest basis. The entity subcontracts equipment on an as required basis and as a result all exploration
and evaluation costs incurred are of an intangible nature. Costs incurred before the Company has
obtained the legal rights to explore an area are recognised as an expense in the income statement.
Exploration and evaluation assets are only recognised if the rights of the area of interest are current and
either:
the expenditures are expected to be recouped through successful development and exploitation
(i)
of the area of interest; or
(ii)
activities in interest have not at the reporting date, reached a stage which permits a reasonable
assessment of the existence or otherwise of economically recoverable reserves and active and
significant operations in, or in relation to, the area of interest are continuing.
Exploration and evaluation assets are assessed for impairment if (i) sufficient data exists to determine
technical feasibility and commercial viability, or (ii) facts and circumstances suggest that the carrying
amount exceeds the recoverable amount (see impairment accounting policy (e)). For the purposes of
impairment testing, exploration and evaluation assets are allocated to cash-generating units to which
the exploration activity relates. The cash generating unit is never larger than the area of interest.
Once the technical feasibility and commercial viability of the extraction of mineral resources in an area
of interest are demonstrable, exploration and evaluation assets attributable to that area of interest
are first tested for impairment.
(c) Cash and cash equivalent
Cash and cash equivalents comprise cash balances, short term bills and call deposits.
(d) Other receivables
Other receivables are subsequently measured at their amortised cost less impairment losses (see
accounting policy (e))
43
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
A.C.N. 009 159 077
4. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(e)
Impairment
(i)
Financial assets
A financial asset is considered to be impaired if objective evidence indicates that one or more
events have had a negative effect on the estimated future cash flows of that asset.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the
difference between its carrying amount, and the present value of the estimated future cash flows
discounted at the original effective interest rate.
Individually significant financial assets are tested for impairment on an individual basis. The
remaining financial assets are assessed collectively in groups that share similar credit risk
characteristics.
All impairment losses are recognised in profit or loss.
An impairment loss is reversed if the reversal can be related objectively to an event occurring
after the impairment loss was recognised. For financial assets measured at amortised cost, the
reversal is recognised in profit or loss.
(ii)
Non-financial assets
The carrying amounts of the Company’s non-financial assets are reviewed at each reporting date
to determine whether there is any indication of impairment. If any such indication exists then
the asset’s recoverable amount is estimated.
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit
exceeds its recoverable amount. A cash-generating unit is the smallest identifiable asset group
that generates cash flows that largely are independent from other assets and groups.
For the purpose of impairment testing, assets that cannot be tested individually are grouped
together into the smallest group of assets that generates cash inflows from continuing use that
are largely independent of the cash inflows of other assets or groups of assets (the “cash-
generating unit”). Impairment losses are recognised in profit or loss. Impairment losses
recognised in respect of cash-generating units are allocated to reduce the carrying amount of the
other assets in the unit (group of units) on a pro rata basis.
The recoverable amount of deferred exploration and evaluation cost is primarily considered by
directors with reference to the market of capitalisation of the company.
In respect of assets, impairment losses recognised in prior periods are assessed at each reporting
date for any indications that the loss has decreased or no longer exists. An impairment loss is
reversed if there has been a change in the estimates used to determine the recoverable amount.
An impairment loss is reversed only to the extent that the asset’s carrying amount does not
exceed the carrying amount that would have been determined, net of depreciation or
amortisation, if no impairment loss had been recognised.
(f)
Share Capital
Transaction costs
Qualifying transaction costs of an equity transaction, which are incremental and directly attributable to
the issue of ordinary shares, are accounted for as a deduction from equity, net of any related income
tax benefit.
(g) Employee Benefits
The Company does not have any employees and does not therefore provide any employee benefits such
as Wages, Salaries, Annual Leave Sick Leave or Long Service Leave.
(h) Provisions
A provision is recognised in the balance sheet when the Company has a present legal or constructive
obligation as a result of a past event, and it is probable that an outflow of economic benefits will be
required to settle the obligation. If the effect is material, provisions are determined by discounting the
expected future cash flows at a pre-tax rate that reflects current market assessments of the time value
of money and, when appropriate, the risks specific to the liability.
44
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
A.C.N. 009 159 077
4. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(i)
Trade and Other Payables
Trade and other payables are measured at their amortised cost. Trade payables are non-interest
bearing and are normally settled on 60-day terms.
(j)
Finance income
Finance income comprises interest income on funds invested. Interest income is recognised as it
accrues, using the effective interest method.
(k) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except
where the amount of GST incurred is not recoverable from the Australian Tax Office (ATO). In these
circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of an item
of the expense.
Receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability
in the balance sheet.
Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash
flows arising from investing and financing activities which are recoverable from, or payable to, the ATO
are classified as operating cash flows.
(l)
Earnings per Share
The Company presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS
is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the
weighted average number of ordinary shares outstanding during the period.
(m) Determination and presentation of operating segments
For management purposes and for the purposes of reporting to the Board (the Company’s chief decision
makers), the Company is organised into one operating segment, which involves exploration throughout
Australia. The Company’s principal activities are interrelated, and the Company has no revenue from
operations
(n) Borrowings
Borrowings are measured at amortised cost. Gains or losses are recognised in profit or loss through the
amortisation process and when the borrowings are derecognised.
(o) New standards and Interpretations not yet adopted
At the date of authorisation of the financial statements, the Standards and Interpretations listed below
were in issue but not yet effective.
The Company does not anticipate that there will be a material effect on the financial statements from
the adoption of these standards.
Standard/Interpretation
AASB 9 ‘Financial Instruments’, and the relevant amending
standards
Effective for
annual reporting
periods beginning
on or after
Expected to be
initially applied in
the financial year
ending
1 January 2018
30 June 2019
AAASB 15 ‘Revenue from contracts with customers’
1 January 2017
30 June 2018
45
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
5. DETERMINATION OF FAIR VALUES
A.C.N. 009 159 077
A number of the Company’s accounting policies and disclosures require the determination of fair value, for
both financial and non- financial assets and liabilities. Fair values have been determined for measurement
and /or disclosure purposes based on the following methods. When applicable, further information about
the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.
Other receivables
The fair value of other receivables is estimated as the present value of future cash flows, discounted at the
market rate of interest at the reporting date.
6.
FINANCIAL RISK MANAGEMENT
Overview
The Company have exposure to the following risks from their use of financial instruments:
•
•
•
liquidity risk
market risk
interest rate 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. Further quantitative
disclosures are included throughout this financial report.
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.
Cash
The Company limits its exposure to credit risk by only investing in deposit instruments of major Australian
banking institutions.
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due.
The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Company’s reputation.
The Company manages liquidity risk by maintaining adequate reserves by continuously monitoring forecast
and actual cash flows.
Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates, commodity
prices and equity prices will affect the Company’s income or the value of its holdings of financial instruments.
The objective of market risk management is to manage and control market risk exposures within acceptable
parameters, while optimising the return.
Interest rate risk
The Company is exposed to interest rate risk on cash balances.
The Company adopts a policy of placing all of its cash not required for immediate cash flow in its operations
in a high interest-bearing cash management accounts exposed to variable interest rates.
Capital Management
Management controls the capital of the Company in order to ensure that it can fund its operations and
continue as a going concern in conjunction with the continual assessment as to the underlying market value
of its exploration and development projects. The Company has no external debt other than disclosed in the
financial statements and there are no externally imposed capital requirements.
Management effectively manages the Company’s capital by assessing its financial risks and adjusting its
capital structure in response to changes in these risks and in the market. These responses include share
issues. There have been no changes in the strategy adopted by management since the prior year.
46
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
7. OTHER RECEIVABLES
Current
Other receivables
Non - Current
Security deposit – leased premises
8.
PROPERTY, PLANT & EQUIPMENT
Office furniture & fittings, PP&E – at cost
Accumulated depreciation
Total property, plant & equipment
9.
EXPLORATION AND EVALUATION ASSETS
Deferred exploration and evaluation assets
Balance at 1 July 2016
Expenditure during the year
Amounts impaired during the year
Revaluation of rehabilitation provision
Balance at 30 June 2017
Comprised of:
Feysville project
Koongie Park project
Leonora project
Mandilla project
Impairment relates to:
Feysville project
Koongie Park project
Leonora project
Mandilla project
A.C.N. 009 159 077
2017
$
2016
$
27,660
27,660
38,000
38,000
2017
$
11,392
(11,392)
-
-
2017
$
1,672,004
576,711
(18,103)
-
2,230,612
628,196
1,214,317
126,064
262,035
2,230,612
-
(3,580)
(14,523)
-
(18,103)
8,609
8,609
38,000
38,000
2016
$
11,392
(11,392)
-
-
2016
$
1,451,001
231,187
-
(10,184)
1,672,004
240,880
1,135,442
122,704
172,978
1,672,004
-
-
-
-
-
The ultimate recoupment of exploration and evaluation assets is dependent upon successful development
and commercial exploitation, or alternatively sale of the respective areas.
The Company’s exploration properties may be subjected to claim(s) under native title, or contain sacred sites,
or sites of significance to Aboriginal people. As a result, exploration properties or areas within the tenements
may be subject to exploration restrictions, mining restrictions and/or claims for compensation. At this time,
it is not possible to determine whether such claims exist or the quantum of such claims, if any.
47
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
10. TRADE AND OTHER PAYABLES
Current
Trade payables
Accrued director fees
Other payables and accruals
11. BORROWINGS
Current
Loans
A.C.N. 009 159 077
2017
$
282,500
160,000
79,077
521,577
2016
$
329,499
80,000
10,000
419,499
2,987
2,987
102,708
102,708
Loan – J Jones
A loan of $81,664 from director Mr John Jones was repaid during the year.
Loan – P Stern
A loan of $20,000 was paid during the year. Interest of $2,164 owing to director Mr Peter stern remains at
balance date.
Loan – G Smith
Interest of $823 owing to director Mr Graeme Smith remains at balance date.
12. REHABILITATION PROVISION
A provision has been made to cover costs of rehabilitating the Company’s areas of interest. It is not expected
that this will be required in the next 12 months.
Balance at 1 July
Re-estimation of provisions
Provisions used during the year
Balance at 30 June
13.
ISSUED CAPITAL
Issued and Paid Up Capital
258,339,441 ordinary shares fully paid
(2016 – 209,311,348 ordinary shares fully paid)
2017
$
65,220
-
-
65,220
2016
$
75,404
(10,184)
-
65,220
2017
$
30,057,224
2016
$
29,213,403
48
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
13.
ISSUED CAPITAL(continued)
A.C.N. 009 159 077
Share movements during the
year
Issue
Price
($)
2017
Number of
Shares
2017
$
2016
Number of
Shares
2016
$
At beginning of year
209,311,348
29,213,403
160,575,087
28,668,168
Placement – July 2016 - Cash
Issue – August 2016 - in lieu of
amounts owed to directors
Issue – January 2017 – in lieu of
services received
Placement – March 2017 – Cash
Issue – May 2017 – in lieu of
drilling services received
Issue – June 2017 – in lieu of
drilling services received
Placement – October 2015(1)
Placement – June 2015
Cost of capital
0.012
0.016 -
0.02
0.02
0.04
0.02
0.01
0.012
0.012
9,845,010
118,140
5,833,333
70,000
1,154,750
30,750,000
21,970
615,000
645,000
25,800
-
-
-
-
-
-
-
-
-
-
800,000
-
-
-
16,000
-
-
(23,089)
-
19,800,000
28,936,261
-
-
198,000
347,235
-
At the end of the year
258,339,441
30,057,224
209,311,348
29,213,403
The Company does not have authorised capital or par value in respect of its issued shares.
(1) Shares issued in October 2015 includes 1,091,250 million shares issued for services rendered.
14. RESERVES AND ACCUMULATED LOSSES
(a) Reserves
Share-based payments reserve
Balance at beginning of financial year
Share based payments – options (Note 15)
Option issued to Directors (Note 15)
Balance at end of financial year
(b) Accumulated losses
Balance at beginning of financial year
Net loss for the year
Balance at end of financial year
2017
$
569,770
43,000
105,000
717,770
2016
$
432,130
-
137,640
569,770
(28,372,572)
(517,148)
(28,889,720)
(27,978,782)
(393,790)
(28,372,572)
(c) Nature and purpose of reserves
The share-based payments reserve is used to recognise the fair value of options issued.
49
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
15. SHARE BASED PAYMENTS
A.C.N. 009 159 077
As at 30 June 2016, directors were owed $80,000 in relation to remuneration (Note 10). On 25 August 2016,
10.5 million unlisted options were granted to directors in lieu of outstanding directors fees. The options were
ascribed a value of $105,000 using a Black-Scholes model. Of this amount, $25,000 relates to remuneration
incurred in the year to 30 June 2017. The balance of the fair value ($80,000) settles amounts accrued to 30
June 2016. The inputs to the Black-Scholes valuation were as follows:
Measurement date
25 August 2016
Share price at measurement date
Exercise price
Volatility
Expiry date
Risk free rate
$0.012
$0.025
149%
30 November 2020
1.62%
In December 2016, the company issued 3 million options in consideration for services received. The options
have been valued by a Black-Scholes model, under the following assumptions:
Measurement date
1 December 2016
Share price at measurement date
Exercise price
Volatility
Expiry date
Risk free rate
$0.014
$0.04
147%
30 November 2020
1.52%
Unlisted Options
Options over ordinary shares of the Company have been issued for nil cash consideration. The options cannot
be transferred and will not be quoted on the ASX. Therefore, no voting rights are attached to the options
unless converted into ordinary shares. All options are granted at the discretion of the directors.
The terms and conditions of the grants are as follows:
Grant Date &
Vesting Date Granted Number
Expiry Date
Exercise Price
(cents)
Value per option at
grant date (cents)
Exercised
Number
01/12/2014
24,800,000
30/11/2019
22/06/2015
7,500,000
30/11/2019
30/11/2015
37,200,000
30/11/2020
25/08/2016
10,500,000
08/12/2016
3,000,000
30/11/2020
30/11/2020
2
2
2
2.5
4
0.81
0.73
0.37
1
1.43
Nil
Nil
Nil
Nil
Nil
The number and weighted average exercise prices of share options are as follows:
Weighted
average exercise
price 2017
Number of
options 2017
Weighted
average exercise
price 2016
Number of
options 2016
Outstanding at 1 July
Lapsed during period
Exercised during period
Granted during the period
Outstanding at 30 June
Exercisable at 30 June
$0.02
-
-
$0.028
$0.021
$0.021
69,500,000
-
-
13,500,000
83,000,000
83,000,000
$0.02
$0.14
-
$0.02
$0.02
$0.02
35,900,000
(3,600,000)
-
37,200,000
69,500,000
69,500,000
The value of options is recognised as expenses immediately on grant date.
50
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
16.
TAXATION
Current tax expense
Deferred tax expense
a)
Numerical reconciliation between tax expense and pre-tax
accounting loss
Loss before tax
Income tax using the corporate tax rate of 28.5% (2016:
30%)
Current year losses for which no deferred tax asset was
recognised
Income tax expense
b) Unrecognised Deferred Tax Assets
A.C.N. 009 159 077
2017
$
2016
$
-
-
-
-
(517,148)
(393,790)
(147,387)
(112,230)
147,387
-
112,230
-
The Company had estimated tax losses of $21,173,187 (2016: $20,954,872) at 30 June 2017. The tax losses
do not expire under current tax legislation. Deferred tax assets have not been recognised in respect of these
items because it is not probable that future taxable profit will be available against which the company can
use the benefits. The potential future income tax benefit will only be obtained if:
-
-
-
the relevant Company derives future assessable income of a nature and amount sufficient to enable the
benefit to be realised;
the relevant Company complies with the conditions for deductibility imposed by the law; and
no changes in tax legislation adversely affect the relevant Company in realising the benefit.
17.
(i)
LOSS PER SHARE
Basic loss per share
Net loss attributable to ordinary shareholders
(517,148)
(393,790)
As the Company has made a loss for the year ended 30 June 2017, all options on issue are considered
antidilutive and have not been included in the calculation of diluted earnings per share.
2017
$
2016
$
Weighted average number of ordinary shares
Weighted average number of ordinary shares used as the
denominator in calculating basic and diluted loss per share
2017
No. of shares
2016
No. of
shares
238,556,499
174,585,525
Basic loss per share recognised
(0.22 cents)
(0.23 cents)
51
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
18.
NOTES TO THE STATEMENT OF CASH FLOWS
(i) Reconciliation of Cash and Cash Equivalents
A.C.N. 009 159 077
For the purposes of the Statement of Cash Flows, cash and cash equivalents includes cash on hand and
at bank and short-term deposits. Cash and cash equivalents as at the end of the financial year, as shown
in the Statement of Cash Flows is reconciled to the related items in the balance sheet as follows:
Cash on hand
Cash at bank
(ii)
Reconciliation of cash flows from operating activities
Loss for the period after income tax
Adjustments for:
Depreciation
Impairment
Share based payments expense
Interest received
Change in other receivables
Change in operating trade and other payables
2017
$
-
178,786
178,786
2016
$
300
279,115
279,415
(517,148)
(393,790)
-
18,103
242,500
-
(19,051)
45,031
2,515
-
144,135
(11)
5,843
3,160
Net cash used in operating activities
(230,565)
(238,148)
Non-cash investing and financing activities during the year are listed at Note 13.
19.
AUDITOR’S REMUNERATION
Auditor’s services
Audit and review of financial reports
20.
COMMITMENTS
Mineral Tenement Leases
2017
$
2016
$
26,000
21,000
The Company has minimum expenditure obligations in pursuance of the terms and conditions of tenement
licences in the forthcoming year of approximately $660,944(2016: $551,740). The aforementioned
expenditure obligations can be subject to variation to a lesser amount as a result of: reduction in tenement
areas; relinquishment of tenements; and/or farm out of project areas to third party joint venture partners
who assume responsibility for the expenditure obligations. These obligations are expected to be fulfilled in
the normal course of operations of the Company. If the current status of the tenements is maintained, then
for one year or later and not more than five years the total obligations are approximately $1,945,268 (2016:
$2,758,700) and for later than five years the total obligations are Nil (2016: $Nil).
52
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
20.
COMMITMENTS (continued)
Operating Leases
Non-cancellable operating lease rentals are payable as follows:
Less than one year
Between one and five years
More than five years
A.C.N. 009 159 077
2017
$
137,620
84,752
222,372
2016
$
140,312
350,760
-
491,072
The Company leases business office premises under a non-cancellable operating lease, expiring in the 2020
financial year.
21. FINANCIAL INSTRUMENTS
Credit risk
The carrying amount of the Company’s financial assets represents the maximum credit exposure. The
Company’s maximum exposure to credit risk at the balance sheet date was:
Other Receivables
Cash and cash equivalents
Note
7
18(i)
Carrying amount
2017
$
65,660
178,786
244,446
2016
$
46,609
279,415
326,024
None of the company’s other receivables are past due (2014: nil).
Liquidity Risk
The following are the contractual maturities of financial liabilities, including estimated interest payments
and excluding the impact of netting agreements:
30 June 2017
Non-derivative financial liabilities
Carrying
amount
Contractual
cash flows
6 mths or
less
Trade and other payables
521,577
521,577
521,577
30 June 2016
Non-derivative financial liabilities
Carrying
amount
Contractual
cash flows
6 mths or
less
Trade and other payables
419,499
419,499
419,499
Currency risk
The Company is not exposed to foreign currency risk.
Interest rate risk
At the reporting date, the interest rate profile of the Company’s interest bearing financial assets was:
Weighted
average interest
rate
Floating
interest rate
2017
Financial Assets
Cash and cash equivalents
Other receivables
2016
Financial Assets
Cash and cash equivalents
Other receivables
1.0%
3.35%
2.0%
3.35%
$
178,786
-
178,786
279,415
-
279,415
Fixed interest
rate more
than a year
$
Total
$
-
65,660
65,660
-
46,609
46,609
178,786
65,660
244,446
279,415
46,609
326,024
53
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
21. FINANCIAL INSTRUMENTS (continued )
A.C.N. 009 159 077
Ref to Note 11 for information of interest rates relating to borrowings. Trade and other payables are not
interest bearing.
Fair values
The fair values of financial assets and liabilities of the Company at the balance date approximate the
carrying amounts in the financial statements.
Fair value sensitivity analysis for fixed rate instruments
A change in interest rates of 1% at the reporting date would not materially affect profit or loss.
Cash flow sensitivity analysis for variable rate instruments
Interest for the year was $15,431 of which $14,397 and was non-cash, therefore a sensitivity analysis on a
1% change in interest rates would not materially affect the loss for the year.
Fair values versus carrying amounts
The fair values of financial assets and liabilities are the same as the carrying value.
22. RELATED PARTIES
The following were key management personnel of the Company at any time during the reporting period and
unless otherwise indicated were key management personnel for the entire period:
John Load Cecil Jones – Executive Chairman
Peter Stern - Non-executive director
Graeme Smith – Non-executive director / Company Secretary / CFO
Key management personnel compensation
Short-term benefits
Post-employment benefits
Share-based payments
2017
$
185,000
-
-
185,000
2016
$
137,640
-
-
137,640
Information regarding individual directors and executives’ compensation is required by the Corporations
Regulations 2M.3.03 and 2M.6.04 to be provided in the Remuneration Report section of the Directors’ Report
on pages 21 to 25 Apart from the details disclosed in this note, no director has entered into a material contract
with the Company since the end of the previous financial year and there were no material contracts involving
directors’ interests existing at year end.
Related Parties
Transaction
Transactions value
Company
Amount owing by the
30 June
2017
30 June
2016
30 June
2017
30 June
2017
$
$
$
$
J L C Jones – Westbury
Management Services Pty Ltd
Storage / Admin Service
expenses
(21,914)
303
1,976
23,890
J L C Jones
P A Stern
G I Smith
Loan to the company net of
(repayments)
(81,664)
(29,067)
-
81,664
Loan, (repayments) & interest
(18,314)
Loan to the company
256
-
-
2,164
20,478
823
567
G I Smith – Wembley
Corporate Services Pty Ltd
Company Secretarial / CFO
fees
32,658
8,799
54,254
21,596
Tanga Resources Limited
Rent, Carpark & Outgoing
36,468
36,468
-
-
54
ANGLO AUSTRALIAN RESOURCES N.L.
Notes to the Financial Statements
23.
SUBSEQUENT EVENTS
A.C.N. 009 159 077
No matters or circumstances have arisen since the end of the financial year which significantly affected or
may significantly affect the operations of the Company, the results of those operations, or the of the Company
in future financial years other than the following:
• On 6 July 2017, the Company issued 900,500 shares at a deemed price of $0.04 per share for drilling
services.
• On 17 July 2017, the Company issued 590,500 shares at a deemed price of $0.04 per share for legal
services.
• On 31 July 2017, the Company issued 125,000 shares at a deemed price of $0.04 per share for other
services.
• On 29 August 2017, the Company issued 20,248,231 shares, comprising:
o 16,045,335 shares at $0.048 for cash, to fund further exploration work and for working capital;
o 622,396 shares at a deemed price of $0.048 in consideration for provision of services; and
o 3,580,500 shares pursuant to shareholder approval at general meeting of the company on 21
August 2017.
• On 30 August 2017, 6,950,000 options were issued pursuant to shareholder approval at a general meeting
of the company on 21 August 2017.
55
DIRECTORS’ DECLARATION
1.
In the opinion of the directors of Anglo Australian Resources NL
a)
The financial statements and notes, and the Remuneration Report in the Directors’ Report, set out on pages
20 to 55 are in accordance with the Corporations Act 2001, including:
(i)
giving a true and fair view of the financial position of the Company and of its performance, as
represented by the results of its operations and its cash flows, for the year ended on that date; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001;
b)
c)
2.
the directors draw attention to Note 2(a) to the financial statements, which includes a statement of
compliance with International Financial Reporting Standards;
as set out in Note 3, 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 directors have been given the declarations required by Section 295A of the Corporations Act 2001 from
the Company Secretary (who performs the Chief Financial Officer’s function) for the financial year ended 30
June 2017.
Signed in accordance with a resolution of directors:
John Jones
Executive Chairman
Anglo Australian Resources NL
Dated at Perth this 30th day of September 2017
56
ASX Additional Information
Additional information required by Australian Securities Exchange Ltd and not shown elsewhere in this report is as follows.
The information is current as at 26 September 2017.
(a) Issued Capital
The issued capital of the Company at 26 September 2016; 280,203,672 ordinary fully paid shares.
(b) Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
Ordinary shares
Number of holders
Number of shares
1
1,001
5,001
10,001
100,001
- 1,000
- 5,000
- 10,000
- 100,000
and over
The number of shareholders holding less than a
marketable parcel of shares are:
485
654
303
666
285
2393
1,298
(c) Twenty largest shareholders
The names of the twenty largest holders of quoted ordinary shares are:
259,347
1,835,026
2,534,650
25,251,851
250,322,798
280,203,672
16,276,747
Porter Street Investments Pty Ltd
Wise Plan Pty Ltd
Braham Investments Pty Ltd
HSBC Custody Nom Aust Ltd
Fast Lane Aust Pty Ltd
Sunden Pty Ltd
Fontana Sabina
C Thwaites Pty Ltd
Corona Land Holdings Pty Ltd
S Loader Pty Ltd
Dixtru Pty Ltd
Beaumont Michael John
Graham Investments Pty Ltd
Rec WA Pty Ltd
D & P Buckley Pty Ltd
Jones Rhett
Lopez George
Orbit Drilling Pty Ltd
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19 Wembley Corporate Services Pty Ltd
20
Raad Graham
Listed ordinary shares
Number of shares
20,169,616
19,000,000
16,565,255
11,590,129
7,000,000
6,166,667
6,000,000
4,743,532
4,500,000
3,684,910
3,427,214
3,405,180
3,144,078
3,000,000
2,922,229
2,644,687
2,600,000
2,469,000
2,382,999
2,150,000
127,565,496
Percentage of
ordinary shares
7.20%
6.78%
5.91%
4.14%
2.50%
2.20%
2.14%
1.69%
1.61%
1.32%
1.22%
1.22%
1.12%
1.07%
1.04%
0.94%
0.93%
0.88%
0.85%
0.77%
45.53
(d) Substantial shareholders
Porter Street Investments Pty Ltd - 7.2%, Wise Plan Pty Ltd – 6.78%, Braham Investments Pty Ltd – 5.91%
(e) Voting rights
All ordinary shares (whether fully paid or not) carry one vote per share without restriction.
(f) Unquoted Securities
At 19 September 2017, the Company has a total 91,950,000 unlisted options as follows:
Number of Holders
Exercise Price
Number of Options
32,300,000
37,200,000
10,500,000
3,000,000
8,950,000
91,950,000
6
3
3
3
6
21
$0.02
$0.02
$0.025
$0.04
$0.08
Expiry Date
30 November 2019
30 November 2020
30 November 2020
30 November 2020
30 November 2020
61