Aura Biosciences, Inc. Annual Report 2017

FY2017 Annual Report · Aura Biosciences, Inc.

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ANNUAL
REPORT
2017

ACN: 115 927 681

CORPORATE
DIRECTORY

DIRECTORS
Peter Reeve - Executive Chairman
Bob Beeson - Non-Executive Director
Brett Fraser - Non-Executive Director
Julian Perkins - Non-Executive Director

COMPANY SECRETARY
John Madden

REGISTERED OFFICE
Aura Energy
Level 1, 34-36 Punt Road
Windsor VIC 3181
Telephone: +61 3 9516 6500
Facsimile: +61 3 9516 6565
Website: www.auraenergy.com.au

SHARE REGISTRY
Computershare Investor Services Pty Ltd
Level 2, Reserve Bank Building
45 St Georges Terrace
Perth, WA 6000
Telephone: 1300 557 010
Facsimile: 08 9323 2033
Email:
web.queries@computershare.com.au

AURA ENERGY LIMITED
ANNUAL REPORT 2016/17

NOMINATED ADVISOR
AND AIM BROKER
WH Ireland Limited
24 Martin Lane
London, England

AUDITOR
Bentleys London House
Level 3, 216 St Georges Tce
Perth, WA 6000

SOLICITORS
Steinepreis Paganin
Level 4, The Read Building
16 Milligan Street
Perth, WA 6000

CONTENT

1 About Us
2 Our projects
3 Highlights in 2017
4 Chairman’s Letter
6 Operation’s Review
12 Directors’ report
24 Auditor’s Independence Declaration
25 Financial statements
63 Directors’ Declaration
64 Independent Auditor’s Report
69 Additional Information
71 Tenement Report

ABOUT US

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Aura Energy is developing an African
uranium mine, ‘green’ metals in a
European polymetallic, and exploring
for gold and base metals in Africa

Aura Energy Limited is an exploration
and development and company building
a portfolio of high quality projects
towards cashflow. Aura is focussed on
developing the Tiris Uranium Project in
Mauritania and is also broadening its
business to include gold, base metals
and the growing area of ‘green’ metals.

Nuclear power remains key to providing
clean energy as the population swells
along with the demand for non-
polluting energy sources. Aura can
play an important role in supply to
the nuclear industry and also to other
emerging energy sector needs.

Aura’s broadened mineral portfolio
provides a balanced strategy and
opportunity to create cashflow from
different commodities.

Aura focussed its effort in 2017 to
progress the Tiris Uranium Project
Definitive Feasibility Study (DFS) and
continue the push to get its projects into
production quickly and with minimal
dilution.

The challenging uranium environment
continued and Aura redoubled its efforts
to remain competitive in all market
conditions by lowering its Tiris operating
cost to US$19.40/lb U3O8.

Aura continues to prudently progress
its projects to a commercial basis
whilst reviewing options to expand the
business. Gold, base and ‘green’ metals
is a new area Aura laid a foundation for
during 2017 and expects the coming
year to provide interest and hopefully
success in the pursuit for additional
projects.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17

OUR PROJECTS

Development projects in
Mauritania And Sweden

HÄGGÅN POLYMETALLIC SWEDEN –
LONG TERM VALUE
• Now broadened focus with

‘green’ metals

• 75% metal value in metals other

than uranium

• C1 Cash costs US$13.50/lb U3O8

including credits

• U3O8 Mlbs Inferred Resource
• US$537m capital cost

TIRIS URANIUM PROJECT –
MAURITANIA
• Definitive Feasibility Study

progressing well

• C1 Cash costs US$19.40/lb U3O8
• 49 Mlbs Indicated and Inferred

Resource

• US$45m capital cost

AURA ENERGY LIMITED
ANNUAL REPORT 2016/17

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ACTIVITY OVERVIEW
MAURITANIA
• Tiris project Feasibility Study

progressed well

• Commenced resource and water

drilling and expanded the
engineering effort

• Submitted the Tiris Mining Lease

Application

• Broadened the strategy with

gold and base metal tenements

SWEDEN
• Häggån polymetallic attributes

defined

• Conducted drilling on Haggan

and Marby

• Planning for community
engagement program

HIGHLIGHTS IN 2016/17

Aura aggressively pursued its Tiris Definitive
Feasibility Study in 2017 moving the
company closer to production status.
Aura broadened its mineral portfolio to
include gold and base metal exploration
on excellent tenements where previous
successful work has not been followed up.

REDUCED TIRIS
CASH TO

US$19.40Ib

TIRIS MINING
LEASE
APPLICATION
SUBMITTED

BROADENED STRATEGY:
GOLD
AND BASED
METALS
TENEMENTS

HÄGGÅN
GREEN
BATTERY
METALS
DEFINED

AURA ENERGY LIMITED ANNUAL REPORT 2016/17

CHAIRMAN’S LETTER

Aura Energy Limited is developing two projects,
the Tiris Uranium Project and the Häggån
Polymetallic Project which collectively contain
significant mineral resources and a broad suit of
metals. Aura believes shareholders are best served
pursuing production and cashflow.

AURA ENERGY LIMITED
ANNUAL REPORT 2016/17

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This step has ensured Tiris’ viability
in the current market, despite the
abnormally low spot price, and positions
Tiris as one of the most compelling
uranium development projects in the
world.

Häggån emerged during the year as
holding additional promise to supply
the market with the so-called ‘green’
metals. This re-evaluation was prompted
by the rise in the prices of a range of
the battery component metals. Many of
these metals will be taken into solution
using the current leach process and as
such marginal capital is required for
their recovery.

Aura also progressed the search for
a key representative to assist in the
Community Engagement Program for
the Häggån project.

The uranium price remained subdued
during 2017 despite a few pockets of
interest and excitement. Aura however,
shares the belief of a strong uranium
price recovery when contracts between
uranium producers and power utilities
roll off between now and 2020.

The weak sentiment in the uranium
market highlighted the need to be
involved in other mineral ventures and
with that position Aura pressed forward
with its gold and base metal strategy.
This strategy, based on tenements in
Mauritania, is very promising given the
positive assessment of their geological
potential. Located on very prospective
Archean greenstone belts the ground
has been only sporadically and poorly
explored.

Aura Energy Limited is developing
two projects, the Tiris Uranium Project
and the Häggån Polymetallic Project
which collectively contain significant
mineral resources across a broad suit
of metals. Aura maintains a belief that
shareholders are best served by pursuing
production and cashflow.

Following the successful listing on
the London AIM market last year Aura
focussed its efforts to advance all its
projects towards commercial outcomes
and broaden its strategy into other
metals.

As such during 2017 Aura continued
detailed efforts to advance the Definitive
Feasibility Study (DFS) for the Tiris
Uranium Project in Mauritania and
progressed its work on the broader
engagement issues for Häggån
continued.

On the Tiris Project, Aura maintained
excellent momentum on the project
studies and during the year employed
in-house engineering expertise to
advance details for the project. This
was successful and resulted in the
Mining Lease application for Tiris being
submitted on target and by year end
significant elements of the project were
under active costing and estimation.

In the field Aura conducted a range
of activities on resource evaluation,
metallurgical test work and water
searching. Aura also installed a weather
station in the Sahara Desert which
provided essential data for project
design, and health and safety matters for
the development of the project.

Subsequent to year end Aura made a
critical metallurgical breakthrough on
reagent consumption which resulted
in the reduction of Tiris cash cost from
US$30/lb U3O8 to US$19.40/lb U3O8.

Given the success on other greenstone
belts, such as Kalgoorlie, the potential
for discovery and success is high.
Unfortunately, the process for tenement
granting was slower than anticipated
and at year end fieldwork had not
yet commenced. This is expected to
commence shortly.

Algold Resources continued its run of
success on adjacent gold tenements and
this provides encouragement to Aura
that its position in the field has much
upside.

The junior sector remains a tough
arena constantly providing challenges
however Aura continues to strive for
projects which can be commercial as
these are the projects that receive active
support of shareholders.

Aura has a range of these projects and is
developing more with its diversification
efforts.

I would like to thank shareholders, again
for their ongoing support as we move
Aura towards production.

I would also like to thank our staff
and board for their efforts in our
achievements during the year.

Peter Reeve

Executive Chairman

Dated this Friday 29 September 2016

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
OPERATION’S REVIEW

2017 was extremely productive for Aura
following a very successful London AIM
listing……. with renewed effort into…..
achieving low cost production at Tiris,
success in the gold and base metals and
creating long-term value progressing
the Häggån Polymetallic Project.

AURA ENERGY LIMITED
ANNUAL REPORT 2016/17

2017 was extremely productive for Aura
following a very successful London AIM
listing and financing early in the year.

This funding allowed renewed effort
into a range of activities with the key
area of pursuing production at the Tiris
Uranium Project.

To summarise Aura’s activities, they
centred around the following three
principal areas;

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Progressing the Tiris Definitive
Feasibility Study (DFS)

Establishing a strong presence in
gold and base metals

• Re-energising the Häggån
Polymetallic Project

These activities were in line with Aura’s
clear and simple strategy of achieving
low cost production at Tiris, supporting
that development with success in the
gold and base metals program, and
creating large long-term value by
incrementally progressing the Häggån
Polymetallic Project.

By the end of the year excellent progress
had been made with the Tiris Project
and the early engineering phase, the
gold tenement grant was frustratingly
slower than expected and Häggån
emerged as a project that could play a
part in the emerging battery renaissance
with its so-called ‘green’ metals.

The uranium market recovery
continues to take longer than market
commentators have expected and whilst
this does not shake our long-term
belief in uranium it has both driven, and
justified, Aura’s decision to diversify into
other metals.

TIRIS PROJECT – 100% MAURITANIA

The Tiris Uranium Project envisages an operation with
an average life of mine production rate of approximately
800,000 pounds U3O8 over 15 years. Internal expansion
case studies suggest there is potential for Aura to produce
3 million pounds U3O8 per annum. This was detailed in the
2014 scoping study.

The key project attributes are;

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Shallow mining of less than 5m

• Ore beneficiation increases feed grade by up to 500%

• Recovery 94%

This results in a project with a small footprint and a very
manageable development costs;

•

Capital cost - US$45m

• Operating cost - US$19.40/lb U3O8

Aura used 2017 to progress the Tiris DFS with key areas
of activity as follows;

• Mining Lease Application

• Resource Definition work

• Water geophysics and drilling

• Metallurgical progress on test work, simulation and

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flowsheet development

Early stage engineering

Completion of an Environment and Social Impact
Assessment (ESIA)

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Community consultation process

The key advances in 2017 on the Tiris Study were the Mining
Lease Application being submitted on schedule, completion
of the Environmental and Social Impact Assessment, better
understanding of the Tiris mineralisation, and optimisation of
reagent consumption in the process plant reducing estimated
costs by 35% from the scoping study.

Aura has targeted completion for the Tiris DFS by end 2017
however with logistical delays on drilling and optimisation of
those drilling programs this completion date is now likely to
be mid-2018.

GEOLOGY PROGRAM

RESOURCE VALIDATION ACTIVITIES

Ultra-detailed Ground Radiometrics

A program of ultra-detailed ground radiometric surveying was
carried out over all Tiris uranium resource zones as well as
priority exploration targets such as Hippolyte South which
have yet to be drill tested. The surveys were conducted on
lines spaced 20 metres. The flat and vegetation free nature of
the terrain permits rapid and accurate ground surveying.

The survey proved very effective in precisely outlining
mineralised zones, in defining higher grade and lower grade
zones, and locating geological structures with which the
mineralisation is associated. It also demonstrated the potential
value of detailed radiometric surveying in grade control ahead
of mining.

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Figure 1: Hippolyte South Prospect. LH image is uranium
channel airborne radiometrics. RH image is ultra-detailed ground
radiometrics over same area.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
Down-hole gamma logging

WATER SEARCH PROGRAM

A groundwater search field program was initiated in late
2016. This followed on from desk studies by Golder Associates
assessing ground water supply potential in northern
Mauritania. The program to date has comprised:

•

analysis of geological and geophysical data to define
structures and formations with potential to host
significant water

A program of ground geophysics over 22 targets identified
to test for water. All but 3 of the targets are located in
Taoudeni Basin sediments to the south of Aura’s Tiris
resources. The Taoudeni Basin is a source of water
elsewhere in the region.

•

Selection of 12 targets for drill testing. This work is
currently ongoing.

While Aura has utilised downhole gamma logging in early
drilling at Tiris to validate the drilling technique, the resource
work to date has been based on chemical analysis of drill
samples as that is a more direct way of estimating uranium
grade and avoids some potential uncertainties associated with
downhole gamma logging which estimates grade indirectly by
recording radiation levels. However, gamma logging is lower
cost and records depth with +/- 20 cm accuracy compared with
50 cm accuracy associated with drill sampling and assaying.
To test the effectiveness of gamma logging at Tiris 63 holes
that had been drilled and cased in 2015 were gamma logged.
Results of this work were positive and Aura is now proceeding
to use down gamma logging for its resource upgrade work
which requires extensive drilling.

RESOURCE UPGRADE PROGRAMS

A program to increase the proportion of Measured and
Indicated Resources commenced in May 2017 and was in
progress at the end of the reporting year.

The program involves an extensive drilling program on a 50m
x 50m pattern with each hole being gamma logged with cm
accuracy. A proportion of the holes have been drilled by large
diameter triple tube diamond drilling and the core chemically
assayed in order to validate the downhole gamma logging and
to obtain density data throughout the zones drilled. Further
validation will be obtained from a program of trenching soon
to commence.

Figure 2: Ground water targets.

MINING TENEMENT APPLICATION

Applications were lodged in May 2017 with the Ministry of
Mines for 3 Mining Permits covering all of Aura’s currently
defined resources. The applications cover an area of 433
km2. The applications are currently under review by relevant
government authorities and a response is expected within
6 months of lodgement.

ENVIRONMENTAL AND SOCIAL IMPACT ASSESSMENT

As part of the requirements for grant of mining permits a
comprehensive Environmental and Social Impact Assessment
study was completed and submitted. Key conclusions of the
assessment were:

•

Tiris Project will result in substantial benefits at national
and regional level

Project is located in uninhabited hyper-arid area of Sahara
Desert

Project will “provide a net socio-economic benefit
to Mauritania and regional communities of the Tiris
Zemmour Wilaya without compromising environmental
and social values”

Validation diamond drilling at Hippolyte.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17Following the submission of the ESIA a series of community
consultation meetings were held at settlements in the region.

A weather station was installed on site allowing continuous
monitoring of weather conditions remotely.

Aura weather station. Hippolyte Zone 1 in the middle distance.

LITHIUM AND SODA-ASH SEARCH PROGRAM

The extensive salt lakes in Mauritania, known locally as
sabkhas, are a potential source for sodium carbonate or soda
ash which is a reagent required for the leaching of uranium
from Tiris ore. This environment is also a potential source of
other valuable substances, notably lithium.

A program to sample sabkhas in the region commenced in
a modest way due to other project commitments, and will
continue over the next 12 months.

TIRIS METALLURGY AND PROCESS DEVELOPMENT

The development of an efficient and robust process flowsheet
for the Tiris Uranium Project continued through FY 1617.

The process has been based on the natural characteristics
of the Tiris ore to allow upgrade of uranium concentration
through a simple scrubbing and screening process. This results
in rejection of most of material as barren waste, providing a
higher uranium grade and reduced total mass presented to
the leaching circuit. Because of this the leaching circuit size
can be significantly reduced, providing savings in capital and
operating costs.

The focus of process development was to update scoping
study flow sheet and establish a comprehensive program for
confirmation of design criteria in Feasibility study. This will
provide Aura with the basis for detailed confirmation of the
process flow sheet parameters across a range of scenarios to
allow for ore variability in the Tiris Resource.

A key focus was to refine the process model to allow for
optimisation of reagent and water usage. The model used for
definition of process parameters in the Tiris Scoping Study
was based on conservative assumptions that did not include
allowance for optimisation of reagent or water usage.

Aura has further developed this model to generate a steady
state simulation of the process, including scenario analysis for
the optimum configuration of recycle streams. The updated
model has been developed for the base case assumptions
used in the Tiris Scoping Study. Through this optimisation a
reduction in soda ash reagent requirement of 35% was made,
along with significant reductions in the overall size of the
leaching circuit and process water make-up requirements.

Importantly this soda ash usage reduction lowered the
operating cost of Tiris project to US$19.40 /lb U3O8 which
is among the lowest operating costs in the world.

To develop a robust process flow sheet it is important
to fully understand the ore variability in the resource.
Aura has developed a comprehensive plan to populate
a geometallurgical model for the Tiris Resource. This
geometallurgical model will include addition of important
process parameters, such as uranium upgrade factor,
mineralogy, leach behaviour and dewaterability to the
mine plan.

Aura has purchased equipment to undertake the required
test work at a facility in Nouakchott, Mauritania and sample
collection is currently underway as part of the resource
definition drilling program. The geometallurgical model will
be used to define process behaviour domains to be used in
the upcoming Feasibility Study test work program. In addition,
geometallurgical domains will be used in scenario simulation
analysis to define the robustness of the process flow sheet
configuration and identify opportunities for optimisation.

A detailed feasibility study test work program has been
defined for completion on multiple Domains defined from
the geometallurgical model. This program will utilise
bulk samples from primary geometallurgical domains
representative of the first 5 years of mine production. The
focus will be to confirm design criteria for process units in the
Tiris flow sheet. The Feasibility Study test work program is
scheduled for completion in Q2 2018.

Development of the Tiris uranium process over the coming
year will focus on confirmation of process design criteria and
assessing process scenarios. This will provide detailed inputs
for engineering design and reduce technical risk associated
with resource ore variability.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
TIRIS DFS AND ENGINEERING PROGRESS

During 2017 considerable progress was made towards
permitting of the Tiris Project and building the engineering
framework for the project.

In the first instance all work was completed to allow the
submission of the Tiris Mining Lease Application by the
deadline of May 20th. This was achieved and the Mauritanian
Government is now assessing the application.

Engineering work commenced in earnest on the Tiris Uranium
project in June, 2017, and has concentrated on setting up the
following key documentation;

•

The General Design criteria, setting out plant capacities,
design life, availability, site conditions, etc, as the main
project guidelines.

Process Block Flow diagrams, illustrating the process
equipment required,

The Procurement and Site Contracts package list,
specifying how equipment and site contracts shall be
supplied in a series of packages,

The Equipment list, listing all known equipment and the
kw rating of the motors,

Following resolution on these documents, Aura has been
progressively obtaining from the equipment suppliers:-

HÄGGÅN POLYMETALLIC PROJECT –
100%, SWEDEN

The Häggån Polymetallic Project contains and array of metal
elements in significant quantities and is one of the world’s
largest undeveloped mineral deposits in Western Europe.

With the rise of the so called ‘battery metals’ the Häggån
project is being redefined as a potential source of vanadium,
neodymium, cobalt, molybdenum, zinc, copper, nickel and
uranium the project has an exciting future. See chart below.

The project whilst important for battery metals remains
an important source of uranium for Europe and potentially
Sweden, which is 50% nuclear dependent for electricity, and
therefore with potential to provide energy self-sufficiency for
many decades.

Aura believes that whilst the Häggån project is a large and
relatively expensive project undertaking it is also an extremely
valuable project which, in due course, will be a profitable long-
life mine in one of the most stable countries in the world.

During 2017 Aura continued to drill into Häggån to expand
its knowledge of the mineralisation and continues to progress
planning for a programme of community engagement on the
project including presentations on both the regional benefits
of the project and the operating aspects of the project.

•

formal budget pricing,

delivery periods,

layout drawings,

• motor kw,

The budget pricing being obtained will allow updating of the
Feasibility Study cost estimate to current costs.

Aura engaged a Melbourne based engineering consultant
in August to prepare 3D models of the dumping, stockpile,
crushing and screening areas of the plant, and to commence
plant layout drawings.

Aura has also been seeking;

•

Budget estimates of engineering hours and costs for the
detailed engineering phase,

transport logistics advice and costings from the SNIM
Railway Management, and Mauritanian transport
companies.

Metal Value Distribution - Total Metal
Current Prices

U308

V205

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
URANIUM MARKET

The uranium market remained subdued during 2017
however Aura remains confident of price recovery in a 2-3-
year timeframe based on supply demand fundamentals and
the expiry of long term supply contract during that period.

The World Nuclear Association has stated that China
presently has 30 nuclear reactors in operation and another
24 under construction. By 2020-21 China will generate 58
GWe from nuclear power and 150 GWe by 2030. The Chinese
nuclear power development programme is not dependent on
Chinese economic growth as the development programme
is a focused government commitment to meet massive base
load energy demand and to do so in an environmentally
acceptable manner with reduction in air pollution being
the public policy priority. This development agreement with
CEEC/GPEC place Aura in the group of companies that can
take advantage of this growth.

As the chart below confirms the requirement for new
uranium supply is significant over the coming years.

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TASIAST SOUTH GOLD PROSPECT
During 2017 Aura secured the rights to acquire 175 km2 of
prospective gold tenements covering three under-explored
mineralised greenstone belts in Mauritania. The areas lie along
strike from Kinross’ giant 21 Moz Tasiast gold mine and also
from Algold’s Tijirit gold project. The areas are currently held
under exploration permit applications and whilst the leases
were expected to be granted quickly at year end the grants
were still outstanding.

These highly prospective gold areas cover lightly explored
Archean greenstone belts and favourably located 200 km
from Nouakchott, 60 km from the coast, and can be managed
efficiently within the company’s existing management
resources without distraction from Aura’s core uranium focus.

Previous exploration for gold on these permit areas also
located strongly anomalous nickel values in several areas,
associated with ultramafic rocks. In parts of the tenements
high nickel values are associated with anomalous
copper highlighting potential for nickel-copper sulphide
mineralisation, as occurs in the greenstone belts of Australia
and Canada. At this stage there has been no follow-up work
carried out on these nickel targets.

Aura’s Tasiast South project area has the following attributes:

•

Tenements over two lightly explored greenstone belts
covering 175 km2

The 20 Moz Tasiast gold mine is nearby on the same
greenstone belt and highlights the potential for major
deposits in the region

$3 million has been expended by the previous explorer
on airborne geophysics, reverse circulation and air-core
drilling, and sampling

Broad zones of gold mineralisation have been identified
with strong similarities to the Tasiast gold mine
mineralisation and alteration

• No testing deeper than 150m with most previous holes

less than 100m

• High grade drill intersections have been reported

by others in the district from both past and current
programme, including one programmes in progress with
Algold Resources (a TSX-listed entity), which highlight the
current interest and potential in these poorly tested belts

Next steps following grant of the tenements at the Tasiast
South project are:

• Ground electrical geophysics to locate the strongest zones
of disseminated sulphide development for drill targeting

•

Additional bedrock sampling by air-core or auger-drilling
to better define the high nickel ultramafics and zones of
copper/nickel for follow up drilling

• Deep drill testing of targets defined

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
Your Directors present their report
together with the financial statements
of the Group, being the company and its
controlled entities, for the financial year
ended 30 June 2017.

DIRECTORS

The names of Directors in office at any
time during or since the end of the year
are:

A. PETER REEVE
Executive Chairman and
Managing Director

Peter Reeve has been involved in
the Australian resources industry
for approximately 25 years and, as a
professional metallurgist, has held

positions with Rio Tinto, Shell-
Billiton, Newcrest Mining and Normet
Consulting. For seven years Peter worked
at JB Were as a Resource Specialist Fund
Manager and a Resource Corporate
Finance Director. He has been a
management consultant in South Africa
and was involved in an African iron ore
start-up.

Peter was Managing Director and
Chief Executive Officer of Ivanhoe
Australia, which he co-founded with
Robert Friedland, and was a Director of
both EXCO Resources and Emmerson
Resources.

Peter’s specialisation is the development
of company strategy and the
commercialisation of projects, and
alignment with the global investment
community and international resource
corporations.

DIRECTORS’ REPORT

AURA ENERGY LIMITED
ANNUAL REPORT 2016/17

B. DR. BOB BEESON
Non-Executive Director

D. JULIAN PERKINS
Non-Executive Director

E. JOHN MADDEN
Company Secretary

John started his career with Rio Tinto
Limited (formerly CRA Limited) and held
a number of positions in accounting,
planning, business analysis and taxation
as well as the acquisitions group.
Between 1996 and 2000, John was the
Manager- Finance for Rio Tinto at the
Grasberg copper-gold project in West
Papua. On leaving Rio Tinto in 2000,
John worked in Papua New Guinea for
three years on the Hidden Valley/Wafi
gold projects feasibility studies and for
five years on the Tampakan copper-gold
project in the Philippines where he
was the General Manager- Commercial
and Company Secretary for Indophil
Resources NL.

John has provided strategic and
commercial advice as well as specialist
financial modelling services to OK Tedi
Mining Limited, Intrepid Mines Limited,
the Australian Iron Ore Joint Venture
and Mesa Minerals Limited from 2008
to 2011.

John has extensive commercial and
legal experience in Francophone
Africa as he co-founded Indian Pacific
Resources Limited, a Madagascar-based
iron ore explorer and served as an
executive officer from 2011 to 2015.

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Mr Julian Perkins has over 40 years’
experience in the global minerals
industry. He has held senior technical
management positions in Australia for
AngloGold Ashanti Ltd, Acacia Resources
Ltd, Shell Australia, and prior to that for
Billiton International Metals (part of the
Shell Group) in the Netherlands. He has
degrees in mining and metallurgical
engineering, with operational
experience in underground mining
in South Africa and the metallurgical
operations at Nchanga on the Zambian
Copperbelt. He is a Graduate of the
Australian Institute of Company
Directors.

Mr Perkins has extensive experience in
research and development. He was head
of the mineral processing department
at the Arnhem metals research centre
of Shell Research in the Netherlands
for three years. In Australia he was
Chairman of the Board of Parker Centre
Ltd, which managed the A J Parker
Cooperative Research Centre (CRC) for
Hydrometallurgy from 2006 to 2012,
having been a director prior to that. He
has also been a director on the boards
of the Cooperative Research Centre
for Mining and the Australian Centre
for Mining Environmental Research.
He designed and managed the early
metallurgical testwork and flowsheet
design for both of Aura’s projects. He has
been a non-executive director of Aura
Energy Limited since 2011.

Directors have been in office since the
start of the financial year to the date of
this report unless otherwise stated.

Dr. Bob Beeson is a professional
geologist with over 35 years’ experience
in mineral exploration and development.
He has held senior management
positions with Billiton Australia, Acacia
Resources, North Limited and New
Hampton Goldfields and has extensive
experience in leading and managing
teams in many regions of the world. He
was Managing Director of Aura Energy
Ltd since its listing in 2006 and in 2015
vacated the position and is now Non-
Executive Director.

Prior to establishing Aura, Dr Beeson
gained extensive uranium experience
in Australia, South Africa and the
Middle East.

C. BRETT FRASER
Non-Executive Director

Mr Fraser is a qualified accountant with
more than 29 years’ experience in the
mining, finance and securities industry
Mr Fraser is an experienced company
executive having served as a director
and been involved in governance,
negotiation, finance, development,
forensic accounting and operation for
a number of private and ASX listed
companies. As the founder or officer of
businesses in mining, securities trading,
the beverage industry, media, leisure
health and corporate finance Mr Fraser
has extensive knowledge and skills
in company operations. Mr Fraser is
the Non-Executive Chairman of Blina
Minerals, former Chairman of Doray
Minerals Ltd and the Securities Institute
Education, WA chapter, and also a former
director of Gage Roads Brewing Co and
Brainytoys Limited. Mr Fraser holds a
Bachelor of Business degree, is a Fellow
of Certified Practising Accountants, is a
Fellow of the Financial Services Institute
of Australasia and has completed
post graduate studies in finance and
marketing.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
SIGNIFICANT CHANGES IN STATE
OF AFFAIRS

There were no significant changes in the state of affairs of the
Group during the financial year.

EVENTS SUBSEQUENT TO
REPORTING DATE

Since balance date, the Company has informed the market that
it has made a critical metallurgical breakthrough which has
resulted in the reduction of Tiris project cash costs from
US$30 / lb U308 to US$19.40 / lb U308.

LIKELY DEVELOPMENTS

Likely developments, future prospects and business strategies
of the operations of the Group and the expected results of
those operations have not been included in this report as the
Directors believe that the inclusion of such information would
be likely to result in unreasonable prejudice to the Group.

NATURE OF OPERATIONS AND
PRINCIPAL ACTIVITIES

The principal activities of the Group during the financial
year were the exploration and evaluation of its projects in
Mauritania and Sweden.

CORPORATE GOVERNANCE
STATEMENT

Details of the Company’s corporate governance practices
are included in the Corporate Governance Statement set
out on the Company’s website at: www.auraenergy.com.au/
governance.html

DIVIDENDS PAID OR RECOMMENDED

There were no dividends paid or recommended during the
financial year ended 30 June 2017.

REVIEW OF OPERATIONS
OPERATION REVIEW
A detailed review of the Group’s exploration activities is set
out in the section entitled Operations Review on page 6 in this
annual report.

OPERATING RESULTS
The consolidated loss for the year amounted to $3,690,599
(2016: $1,625,775). The increase in the consolidated loss is
largely attributable to the recognition of impairment to the
fair value of exploration projects in Mauritania and Sweden
(see Note 11 Exploration and evaluation assets) as well as
once-off costs associated with the listing of the Group on the
Alternative Investment Market in London.

The financial statements have been prepared on a going
concern basis, which contemplates the continuity of normal
business activity and the realisation of assets and the
settlement of liabilities in the ordinary course of business.
Details of the Groups assessment in this regard can be found
in Note 1. Statement of significant accounting policies-Going
concern. The auditor’s report contains an emphasis on matter
in this regard.

FINANCIAL POSITION
The net assets of the Group have increased by $3,056,407 from
30 June 2016 to $16,897,113 at 30 June 2017.

As at 30 June 2017, the Group’s cash and cash equivalent
increased from 30 June 2016 by $2,335,202 (including foreign
exchange movements) to $2,652,960. The Group had a working
capital surplus of $2,026,388 (2016: $297,004 working capital
deficit).

AURA ENERGY LIMITED ANNUAL REPORT 2016/17INFORMATION ON DIRECTORS

Peter Reeve

Qualifications

Executive Chairman and Managing Director

Bachelor of Applied Sciences.

Experience

Board member since 13 July 2013 with over 30 years’ experience positions with Rio Tinto, Billiton
Australia and Newcrest Mining as well as experience as a Resource Fund Manager and Resources
Corporate Finance Director at J B Were and Son. More recently Peter was Chief Executive Officer of
Ivanhoe Australia Ltd.

Interest in shares and options

12,812,365 ordinary shares in Aura Energy Limited and 35,000,000 options.

Directorships held in other
listed entities in last 3 years

Nil

Dr Robert Beeson

Director (Non-executive)

Qualifications

Bachelor of Science with Honours; PhD; Member of the Australian Institute of Geoscientists

Experience

Board member since 31 March 2006. Geologist with over 35 years of global experience in
uranium and other commodity management, exploration and development.

Interest in shares and options

3,129,071 ordinary shares in Aura Energy Limited held directly and 2,472,501 ordinary shares
held indirectly; and 10 million options over ordinary shares at 10 cents per option and 20 million
options over ordinary shares at 15 cents per option.

Directorships held in other
listed entities in last 3 years

Managing Director of Drake Resources Limited from November 2004 until 31 January 2015. Non-
executive director or Drake Resources Limited until 1 February 2015. No other directorships in the
past three years.

Brett Fraser

Director (Non-executive)

Qualifications

Experience

Fellow of Certified Practicing Accountants; Fellow of the Financial Services Institute of
Australasia; Grad Dip Finance, Securities Institute of Australia; Bachelor of Business (Accounting);
International Marketing Institute - AGSM Sydney.

Board member since 24 August 2005.

Interest in shares and options

3,957,600 ordinary shares in Aura Energy Limited.

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Directorships held in other
listed entities in last 3 years

Non-executive director and Chairman of Blina Diamonds NL since September 2008 and non-
executive director and Chairman of Drake Resources Limited until 10 March 2017. No other
directorships in the past three years.

Julian Perkins

Director (Non-executive)

Qualifications

Master of Science (Imperial College of Science and Technology) 1972; Associate of the Camborne
School of Metalliferous Mining (Honours) 1967; Fellow of the Australasian Institute of Mining and
Metallurgy; Graduate of the Australian Institute of Company Directors.

Board member since 7 June 2011.

Mr. Perkins has over 40 years’ experience in operations and management with major companies
in the international minerals industry. He was Manager of Mining and Technology (Australia)
for AngloGold Ashanti Ltd, until 2006. His career includes operating and management roles on
the Zambian Copperbelt, leading the mineral processing at Shell Research in the Netherlands
before returning to corporate management in Australia. He was Chairman of Parker Centre Ltd
for Hydrometallurgy from 2006 to 2012 and previously a director of the CRC Mining and the
Australian Centre for Mining Environmental Research.

Experience

Interest in shares and options

2,861,990 ordinary shares in Aura Energy Limited.

Directorships held in other
listed entities in last 3 years

No other directorships held in other listed entities.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
MEETINGS OF DIRECTORS

During the financial year the board of directors held seven meetings (including committees of directors) with the remainder of
meetings conducted by way of written resolution. Attendances by each director during the year were as follows:

DIRECTORS’ MEETINGS

REMUNERATION COMMITTEE

AUDIT COMMITTEE

NUMBER ELIGIBLE

TO ATTEND NUMBER ATTENDED

COMMITTEE MEETINGS

PD Reeve

Dr R Beeson

BF Fraser

JC Perkins

ENVIRONMENTAL REGULATIONS

The Company is commencing exploration and evaluation
activities in Mauritania and Sweden. Both countries have
environmental regulation for the conduct of exploration
activities. The Company has complied with these
environmental regulations in the conduct of all field activities.

The directors have considered the enacted National
Greenhouse and Energy Reporting Act 2007 (the NGER Act)
which introduced a single national reporting framework for
the reporting and dissemination of information about the
greenhouse gas emissions, greenhouse gas projects, and
energy use and production of corporations. At the current
stage of development, the directors have determined that
the NGER Act has no effect on the Company for the current,
nor subsequent, financial year. The directors will reassess this
position as and when the need arises.

NON-AUDIT SERVICES

During the year ended 30 June 2017, AIM listing and taxation
consulting services were provided to the Company by a party
related to the auditors, Bentleys. These services amounted to
$10,550 (2016: $22,085). Details of remuneration paid to the
auditor can be found within the financial statements at Note 4
Auditor’s remuneration.

The directors are satisfied that the provision of non-audit
services during the year by Bentleys (or by another person
or firm on Bentley’s behalf) is compatible with the general
standard of independence for auditors imposed by the
Corporations Act 2001 (Cth).

INDEMNIFYING OFFICERS
OR AUDITOR

During or since the end of the financial year the Company has
given an indemnity or entered into an agreement to indemnify,
or paid or agreed to pay insurance premiums as follows:

•

The Company has entered into agreements to indemnify
all directors and provide access to documents, against
any liability arising from a claim brought by a third party
against the Company. The agreement provides for the
Company to pay all damages and costs which may be
awarded against the directors.

The Company has paid premiums to insure each of
the directors against liabilities for costs and expenses
incurred by them in defending any legal proceedings
arising out of their conduct while acting in the capacity
of director of the company, other than conduct involving
a willful breach of duty in relation to the Company. The
amount of the premium was $19,360 (2016: $9,092).

• No indemnity has been paid to auditors of the Group.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17OPTIONS

At the date of this report, the unissued ordinary shares of Aura Energy Limited under option (listed and unlisted) are as follows:

GRANT DATE

DATE OF EXPIRY

EXERCISE PRICE

NUMBER UNDER OPTION

12 November 2014

12 November 2018

10 June 2015

9 June 2018

9 February 2019

9 February 2020

9 February 2021

23 December 2015

23 December 2017

5 February 2016

5 February 2018

12 September 2016

11 September 2019

9 May 2016

9 May 2018

$0.070

$0.100

$0.150

$0.025

$0.02

$0.025

12,500,000

8,750,000

6,250,000

2,500,000

8,750,000

8,163,265

10,897,960

6,578,699

16,413,265

89,553,189

No person entitled to exercise the option has or has any right by virtue of the option to participate in any share issue
of any other body corporate.

PROCEEDINGS ON BEHALF OF

No person has applied for leave of Court to bring proceedings
on behalf of the Company or intervene in any proceedings
to which the Company is a party for the purpose of taking
responsibility on behalf of the Company for all or any part of
those proceedings.

The Company was not a party to any such proceedings during
the year.

AUDITOR’S INDEPENDENCE
DECLARATION

The lead auditor’s independence declaration for the year
ended 30 June 2017 has been received and can be found in the
annual report.

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REMUNERATION REPORT (AUDITED)
REMUNERATION POLICY
The remuneration policy of the Group has been designed to
align director and management objectives with shareholder
and business objectives by providing a fixed remuneration
component, and offering specific long-term incentives based
on key performance areas affecting the Group’s financial
results. The board of directors believes the remuneration
policy to be appropriate and effective in its ability to attract
and retain the best management and directors to run and
manage the Group,
as well as create goal congruence between directors,
executives and shareholders.

The policy of the board of directors for determining the
nature and amount of remuneration for board members and
senior executives of the Group is described in the following
paragraphs.

The remuneration policy of the Group sets the terms and
conditions for executive directors and other senior executives.
Due to the rapidly changing circumstances of the Group in
recent years, the policy is reviewed annually by the board of
directors with the purpose of maintaining alignment of the
board and management with the Group’s strategic objectives.
Management is also entitled to participate in employee share
and option arrangements. All executives receive a base salary
which takes into account such factors as length of service and
experience, superannuation and share based incentive such
as options. The board of directors review executive packages
annually by reference to the performance of the Group,
individual executives and relevant comparable remuneration
data from similar listed companies and appropriate industry
sectors. Independent expert advice is sought as required.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
The total amount of non-executive directors’ remuneration is proposed by the board of directors from time to time at the Annual
General Meeting and is subject to formal approval by shareholders. Within this limit, the board of directors presently remunerates
non-executive directors at around the average of those obtained from relevant comparable data from similar listed companies
and appropriate industry sectors. A measure of longer-term incentive is provided by the allocation of options to non-executive
directors. The board of directors determines remuneration to individual non-executive directors, working within the limit set by
shareholders, and taking into account any special duties or accountability. Payments to non-executive directors are not linked to
Company performance but in order to align their interest with those of shareholders, non-executive directors are encouraged to
hold shares in Aura Energy Limited.

Executives and non-executive directors have received a superannuation guarantee contribution as required by law, which
increased to 9.5% on 1 July 2014, but do not receive any other retirement benefits.

All remuneration paid to non-executive directors and executives is valued at the cost to the Company and is expensed. Options
over ordinary shares granted to directors and employees are valued using the Black-Scholes methodology. Details of directors’ and
executives’ interests in options as at 30 June 2017 are provided in the Remuneration Report of the financial statements.

The Chairman became Executive Chairman and Managing Director of the Company with effect on 1 January 2015 and accordingly,
is a fulltime employee. The Executive Chairman and Managing Director has agreed to settle 20% of his salary by way of fully paid
ordinary shares in the Company.

Under clause 13.8 of the Constitution of the Company the total aggregate amount fixed sum per annum to be paid to non-
executive directors is $200,000. The Company proposes to put to shareholders a resolution to raise this total aggregate fixed sum
to $400,000. This is the first time the total aggregate fixed term will have been raised since incorporation.

At the annual general meeting on 30 November 2016, 59.6% of votes cast for the adoption of the remuneration report voted in
favour of the resolution. The number of votes cast in favour of the resolution totalled 3,961,865.

REMUNERATION DETAILS FOR THE YEAR ENDED 30 JUNE 2017
There were no cash bonuses paid during the year and there are no set performance criteria for achieving cash bonuses.

The following table of benefits and payment details, in respect to the financial year, the components of remuneration for each
member of the key management personnel of the Group:

2017

GROUP KEY
MANAGEMENT
PERSONNEL

SHORT-TERM BENEFITS

POST-
EMPLOYMENT
BENEFITS

LONG-TERM
BENEFITS

EQUITY-SETTLED SHARE-
BASED PAYMENTS

TOTAL

SALARY,
FEES AND
LEAVE

PROFIT
SHARE AND
BONUSES

NON-
MONETARY

OTHER

SUPER-
ANNUATION

OTHER

EQUITY

OPTIONS

COMPEN-
SATION
CONSISTING
OF
OPTIONS

PD Reeve(1)

324,562

Dr R Beeson

BF Fraser

JC Perkins

40,000

JM Madden(2)

444,562

120,417

25,438

3,800

120,417

36,838

100,000

69,552

519,552

13.4%

43,800

120,417

100,000

69,552

771,369

13.4%

(1) Mr PD Reeve was issued 1,921,295 fully paid ordinary shares (net of tax) in the Company pursuant to his contract of employment.

(2) Mr JM Madden is retained as a contractor and his appointment to the position is subject to a month-by- month arrangement until such time as the

Company secures long-term finance to advance its projects.

AURA ENERGY LIMITED ANNUAL REPORT 2016/172016

GROUP KEY
MANAGEMENT
PERSONNEL

SHORT-TERM BENEFITS

POST-
EMPLOYMENT
BENEFITS

LONG-TERM
BENEFITS

EQUITY-SETTLED SHARE-
BASED PAYMENTS

TOTAL

SALARY,
FEES AND
LEAVE

PROFIT
SHARE AND
BONUSES

NON-
MONETARY

OTHER

SUPER-
ANNUATION

OTHER

EQUITY

OPTIONS

COMPEN-
SATION
CONSISTING
OF OPTIONS

PD Reeve(1)

321,400

Dr R Beeson

BF Fraser

JC Perkins

SF Zillwood(2)

JM Madden(3)

40,000

43,800

40,000

445,200

53,299

39,149

92,448

28,600

3,800

36,200

100,000

158,645

608,645

26.1%

43,800

53,299

39,149

100,000

158,645

832,493

19.1%

(1) Mr Reeve was issued 3,725,500 fully paid ordinary shares (net of tax) in the Company pursuant to his contract of employment.

(2) Mr SF Zillwood is employed by Foster Resources Pty Ltd, a company controlled by Mr SF Zillwood, which provided company secretarial and accounting

services to the Company for the period 1 July 2015 to 31 March 2016 pursuant to a consultancy contract, dated 30 December 2013.

(3) Mr JM Madden was appointed company secretary and chief financial officer on 31 March 2016 following the decision by Mr SF Zillwood to retire and

accordingly, terminate his contractual relationship with the Company. Mr Madden is retained as a contractor and his appointment to the position is
subject to a month-by- month arrangement until such time as the Company secures long-term finance to advance its projects.

SERVICE AGREEMENTS
The Executive Chairman and Managing Director, Peter Reeve,
is employed under a contract of employment, effective 1
January 2015.

The employment deed stipulates a four weeks’ resignation
period. The Company may terminate the employment contract
without cause by providing four weeks’ written notice, or
making payment in lieu of notice based on the individual’s
annual salary component.

If employment is terminated other than for serious misconduct,
and the employee is not then otherwise in default of this
contract and his employment, the Managing Director will,
in connection with his retirement from the office, receive
in addition to the required four weeks’ notice period, three
months’ salary. An additional benefit may be paid in the
amount of one month for every year of service. This is subject
to the provisions of the Corporations Act 2001 (Cth), which may
require shareholder approval.

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SHARE-BASED COMPENSATION

Incentive Option Scheme

Options are granted under the Aura Energy Limited
Incentive Option Scheme. All staff who have been
continuously employed by the Company for a period of
at least one year are eligible to participate in the plan.
Options are granted under the plan for no consideration.

b. Director and Key Management Personnel Options

On 9 June 2015, the Company granted the Executive
Chairman and Managing Director the following options
over ordinary shares:

• 8,750,000 at an exercise price of $0.10 each. The
options are exercisable on or before 9 June 2018.

• 6,250,000 at an exercise price of $0.10 each. The

options are exercisable on or before 9 February 2019.

• 2,500,000 at an exercise price of $0.15 each. The
options are exercisable on or before 9 June 2019.

• 8,750,000 at an exercise price of $0.15 each. The
options are exercisable on or before 9 June 2020.

• 8,750,000 at an exercise price of $0.15 each. The
options are exercisable on or before 9 June 2021.

As at the date of this report, all options over ordinary
shares previously granted to non-executive directors have
expired.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
c. Share-based Payments

The terms and conditions relating to options granted as remuneration during the year to directors and key management
personnel are as follows:

2017

GROUP KEY
MANAGEMENT
PERSON

GRANT DATE

GRANT VALUE
$ (NOTE 1)

REASON FOR
GRANT

VESTING DATE

PERCENTAGE
VESTED
DURING YEAR
%

PERCENTAGE
FORFEITED
DURING YEAR
%

PERCENTAGE
REMAINING AS
UNVESTED
%

EXPIRY DATE

PD Reeve

10 Jun 2015

66,436

57,884

19,445

87,364

Note 1 9 Jun 2016

Note 1 9 Feb 2016

Note 1 9 Feb 2017

10 Jun 2015

103,555

Note 1 9 Feb 2018

100

- 9 Jun 2018

- 9 Feb 2019

- 9 Feb 2020

100 9 Feb 2021

RANGE OF
POSSIBLE
VALUES
RELATING
TO FUTURE
PAYMENTS

Note 1. The options have been granted to the Executive Chairman and Managing Director as part of his remuneration and for
future performance. The vesting conditions of the options are as follows:

• Tranche 1: vest at immediately, exercisable at 10 cents, expire 9 June 2018.

• Tranche 2: vest at 8 months from issue, exercisable at 10 cents, expire 9 February 2019.

• Tranche 3 vest at 8 months from issue, exercisable at 15 cents, expire 9 February 2019.

• Tranche 4: vest at 20 months from issue, exercisable at 15 cents, expire 9 February 2020.

• Tranche 5 vest at 32 months from issue, exercisable at 15 cents, expire 9 February 2021.

Details of all Share-Based Payments in existence during the year can be found at Note 19 Share-Based Payments.

2016

GROUP KEY
MANAGEMENT
PERSON

GRANT DATE

GRANT VALUE
$ (NOTE 1)

REASON FOR
GRANT

VESTING DATE

PERCENTAGE
VESTED
DURING YEAR
%

PERCENTAGE
FORFEITED
DURING YEAR
%

PERCENTAGE
REMAINING AS
UNVESTED
%

EXPIRY DATE

PD Reeve

10 Jun 2015

66,436

57,884

19,445

87,364

Note 1 9 Jun 2016

Note 1 9 Feb 2016

Note 1 9 Feb 2017

10 Jun 2015

103,555

Note 1 9 Feb 2018

100

- 9 Jun 2018

- 9 Feb 2019

100 9 Feb 2020

100 9 Feb 2021

RANGE OF
POSSIBLE
VALUES
RELATING
TO FUTURE
PAYMENTS

Note 1. The options have been granted to the Executive Chairman and Managing Director as part of his remuneration and for
future performance. The vesting conditions of the options are as follows:

• Tranche 1: vest at immediately, exercisable at 10 cents, expire 9 June 2018.

• Tranche 2: vest at 8 months from issue, exercisable at 10 cents, expire 9 February 2019.

• Tranche 3 vest at 8 months from issue, exercisable at 15 cents, expire 9 February 2019.

• Tranche 4: vest at 20 months from issue, exercisable at 15 cents, expire 9 February 2020.

• Tranche 5 vest at 32 months from issue, exercisable at 15 cents, expire 9 February 2021.

Details of all Share-Based Payments in existence during the year can be found at Note 19 Share-Based Payments.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17d. Description of Options Issued as Remuneration

Details of the options over ordinary shares granted as remuneration to those KMP listed in the previous tables are as follows:

GRANT DATE

ISSUER

ENTITLEMENT ON
EXERCISE

10 Jun 2015

DATES EXERCISABLE

From vesting date to

9 Jun 2018 (expiry)

9 Feb 2019 (expiry)

10 Jun 2015

Aura Energy Ltd

1:1 ordinary shares 9 Feb 2019 (expiry)

10 Jun 2015

9 Feb 2020 (expiry)

9 Feb 2021 (expiry)

EXERCISE PRICE
$

VALUE PER OPTION
AT GRANT DATE
$

AMOUNT PAID/
PAYABLE BY
RECIPIENT
$

0.10

0.15

0.0076

0.0093

0.0078

0.0100

0.0118

Options over ordinary shares values at grant date were determined using the Black-Scholes method.

Details relating to service and performance criteria required for the vesting of options over ordinary shares have been
provided in the within the financial statements at Note 19. Share-based payments.

KEY MANAGEMENT PERSONNEL (KMP) EQUITY HOLDINGS

a. Fully paid ordinary shares of Aura Energy Limited held by each KMP

2017

GROUP KEY
MANAGEMENT PERSON

PD Reeve(1)

RF Beeson

BF Fraser

JC Perkins

JM Madden

BALANCE AT
START OF YEAR
NO.

RECEIVED DURING THE
YEAR AS COMPENSATION
NO.

RECEIVED DURING THE
YEAR ON THE EXERCISE
OF OPTIONS
NO.

OTHER CHANGES DURING
THE YEAR(1)
NO.

BALANCE AT END
OF YEAR
NO.

9,718,304

5,636,937

3,957,600

2,861,990

1,921,295

22,174,831

1,921,295

11,639,599

5,636,937

3,957,600

2,861,990

24,096,126

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(1) Mr PD Reeve was issued 1,926,295 fully paid ordinary shares pursuant to his contract of employment with the Company.

2016

GROUP KEY
MANAGEMENT PERSON

PD Reeve(1)(2)

Dr R Beeson

BF Fraser

JC Perkins

JM Madden

SF Zillwood

BALANCE AT
START OF YEAR
NO.

RECEIVED DURING THE
YEAR AS COMPENSATION
NO.

RECEIVED DURING THE
YEAR ON THE EXERCISE
OF OPTIONS
NO.

OTHER CHANGES DURING
THE YEAR(1)
NO.

BALANCE AT END OF
YEAR
NO.

5,442,804

5,636,937

3,957,600

2,861,990

3,725,500

17,899,331

3,725,500

550,000

9,718,304

5,636,937

3,957,600

2,861,990

550,000

22,174,831

(1) Mr PD Reeve was issued 3,725,500 fully paid ordinary shares pursuant to his contract of employment with the Company.

(2) Mr PD Reeve purchased 550,000 fully paid ordinary shares in the Company on the market.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
b. Options of Aura Energy Limited held by each KMP

2017

GROUP KEY
MANAGEMENT PERSON

PD Reeve(1)

Dr R Beeson(2)

BF Fraser(3)

JC Perkins(4)

JM Madden

BALANCE AT START
OF YEAR
NO.

GRANTED AS
REMUNERATION
DURING THE YEAR
NO.

EXERCISED DURING
THE YEAR
NO.

OTHER CHANGES
DURING THE YEAR
NO.

BALANCE AT END OF
YEAR
NO.

VESTED AND
EXERCISABLE
NO.

37,000,000

2,125,000

625,000

1,250,000

41,000,000

(2,000,000)

35,000,000

26,250,000

(2,125,000)

(625,000)

(1,250,000)

(6,000,000)

35,000,000

26,250,000

(1) 2,000,000 options over ordinary shares granted to Mr PD Reeve at 15 cents per option expired on 13 July 2016.

(2) 2,125,000 options over ordinary shares granted to Dr R Beeson at 15 cents per option expired on 13 July 2016

(3) 625,000 options over ordinary shares granted to Mr BF Fraser at 15 cents per option expired on 13 July 2016

(4) 1,250,000 options over ordinary shares granted to Mr JC Perkins at 15 cents per option expired on 13 July 2016

2016

GROUP KEY
MANAGEMENT PERSON

PD Reeve(1)

Dr R Beeson(2)

BF Fraser(3)

JC Perkins(4)

SF Zillwood

JM Madden

BALANCE AT START
OF YEAR
NO.

GRANTED AS
REMUNERATION
DURING THE YEAR
NO.

EXERCISED DURING
THE YEAR
NO.

OTHER CHANGES
DURING THE YEAR
NO.

BALANCE AT END OF
YEAR
NO.

VESTED AND
EXERCISABLE
NO.

39,333,104

2,295,205

901,000

1,392,595

43,921,904

(2,333,104)

37,000,000

19,500,000

(170,205)

(276,000)

(142,595)

2,125,000

625,000

1,250,000

(2,921,904)

41,000,000

23,500,000

(1) 2,250,000 options over ordinary shares granted to Mr PD Reeve at 15 cents per option expired on 13 January 2016 and 83,104 options over ordinary

shares issued pursuant to the non-renounceable rights issue on 5 September 2014 expired on 1 September 2015

(2) 170,205 options over ordinary shares issued pursuant to the non-renounceable rights issue on 5 September 2014 expired on 1 September 2015

(3) 276,000 options over ordinary shares issued pursuant to the non-renounceable rights issue on 5 September 2014 expired on 1 September 2015

(4) 142,595 options over ordinary shares issued pursuant to the non-renounceable rights issue on 5 September 2014 expired on 1 September 2015

LOANS TO KEY MANAGEMENT PERSONNEL
There are no loans made to directors of Aura Energy as at 30 June 2017 (2016: nil).

AURA ENERGY LIMITED ANNUAL REPORT 2016/17OTHER TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL

Amounts owing to KMP

Payable for unpaid fees

PD Reeve

Dr R Beeson

BF Fraser

JC Perkins

JM Madden

2017
$

2016
$

50,000

3,166

8,000

40,150

18,840

There have been no other transactions involving equity instruments other than those described in this Annual Report.

This Report of the Directors, incorporating the Remuneration Report, is signed in accordance with a resolution of directors made
pursuant to s.298(2) of the Corporations Act 2001 (Cth).

Peter Reeve

Executive Chairman and Managing Director

Dated this Friday 29 September 2016

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
AUDITOR’S INDEPENDENCE DECLARATION

To The Board of Directors

Auditor’s Independence Declaration under Section 307C of the
Corporations Act 2001

As lead audit director for the audit of the financial statements of Aura Energy Limited for
the financial year ended 30 June 2017, I declare that to the best of my knowledge and
belief, there have been no contraventions of:

the auditor independence requirements of the Corporations Act 2001 in relation to

the audit; and

any applicable code of professional conduct in relation to the audit.

Yours faithfully

BENTLEYS
Chartered Accountants

DOUG BELL CA
Director

Dated at Perth this 29th day of September 2017

AURA ENERGY LIMITED ANNUAL REPORT 2016/17FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2017

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AURA ENERGY LIMITED
ANNUAL REPORT 2016/17

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2017

Impairment of exploration expenditure previously capitalised

(1,397,602)

Continuing operations

Revenue

Accounting and audit fees

Computers and communications

Depreciation

Employee benefits

Exchange fluctuation

Finance Costs

NOTE

Insurance

Consulting fees and corporate advisory

Public relations

Rent and utilities

Share-based payments

Share registry and listing fees

Travel and accommodation

Write-off of exploration assets

AIM listing costs

Other expenses

Loss before income tax

Income tax benefit

Loss from continuing operations

Other comprehensive income, net of income tax

Items that will not be reclassified subsequently to profit or loss

Items that may be reclassified subsequently to profit or loss:

Foreign currency movement for controlled entity no longer consolidated

Foreign currency movement

Other comprehensive income for the year, net of tax

2017
$

4,905

2016
$

4,907

(161,277)

(149,416)

(35,034)

(6,319)

(736,614)

(173,997)

(32,981)

(31,238)

(100,650)

(66,178)

(69,552)

(119,455)

(70,290)

(640,963)

(53,354)

(44,193)

(1,602)

(711,929)

(8,171)

(51,378)

(223,149)

(22,472)

(39,847)

(158,645)

(79,385)

(49,273)

(51,461)

(165,840)

(22,529)

(3,690,599)

(1,774,383)

148,608

(3,690,599)

(1,625,775)

(45,374)

(149,701)

(195,075)

31,563

Total comprehensive income attributable to members of the parent entity

(3,885,674)

(1,594,212)

Earnings per share:

Basic loss per share (cents per share)

(0.53)

(0.41)

The consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with the accompanying notes.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2017

Current assets

Cash and cash equivalents

Trade and other receivables

Financial assets

Total current assets

Non-current assets

Plant and equipment

Exploration and evaluation assets

Total non-current assets

Total assets

Current liabilities

Trade and other payables

Short-term provisions

Financial liabilities

Total current liabilities

Total liabilities

Net assets

Equity

Issued capital

Reserves

Accumulated losses

Total Equity

NOTE

2017
$

2,652,960

62,854

53,930

2,769,744

2016
$

317,758

57,708

43,625

419,091

18,905

14,851,820

14,870,725

14,137,710

17,640,469

14,556,801

576,605

118,948

47,803

743,356

550,844

165,251

716,095

16,897,113

13,840,706

39,558,943

32,784,203

841,671

1,029,542

(23,503,501)

(19,973,039)

16,897,113

13,840,706

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The consolidated statement of financial position is to be read in conjunction with the accompanying notes.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2017

ISSUED
CAPITAL
$

ACCUMULATED
LOSSES
$

OPTIONS
RESERVE
$

FOREIGN
EXCHANGE
TRANSLATION
RESERVE
$

TOTAL
$

Balance at 1 July 2015

31,311,988 (18,451,415)

398,924

502,328

13,761,825

Loss for the year attributable owners of the parent

Other comprehensive income for the year attributable
owners of the parent

Total comprehensive income for the year attributable
owners of the parent

Transaction with owners, directly in equity

Shares issued during the year

Transaction costs

Options expired during the year

Options exercised during the year

Options issued during the year

Balance at 30 June 2016

(1,625,775)

1,579,816

(107,601)

104,151

(104,151)

200,878

(1,625,775)

31,563

(1,594,212)

1,579,816

(107,601)

200,878

32,784,203 (19,973,039)

495,651

533,891

13,840,706

Balance at 1 July 2016

32,784,203 (19,973,039)

495,651

533,891

13,840,706

Loss for the year attributable owners of the parent

Other comprehensive income for the year attributable
owners of the parent

Total comprehensive income for the year attributable
owners of the parent

Transaction with owners, directly in equity

(3,690,599)

(45,374)

(3,735,973)

(3,690,599)

(149,701)

(195,075)

(149,701)

(3,885,674)

7,113,657

(338,917)

167,341

7,113,657

(338,917)

205,511

(205,511)

167,341

39,558,943 (23,503,501)

457,481

384,190

16,897,113

Shares issued during the year

Transaction costs

Options expired during the year

Options exercised during the year

Options issued during the year

Balance at 30 June 2017

The consolidated statement of changes in equity is to be read in conjunction with the accompanying notes

AURA ENERGY LIMITED ANNUAL REPORT 2016/17CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2017

Cash flows from operating activities

Receipts from customers

Interest received

Payments to suppliers and employees

Payments for exploration expenditure

Payments for listing on AIM

Rebate received for Research and Development

Net cash used in operating activities

Cash flows from investing activities

Purchase of plant and equipment

Net cash used in investing activities

Cash flows from financing activities

Proceeds from issue of shares

Capital raising costs

Net cash provided by financing activities

Net increase/(decrease) in cash held

Cash at 1 July

Change in foreign currency held

Cash at 30 June

The consolidated statement of cash flows is to be read in conjunction with the accompanying notes.

NOTE

2017
$

4,905

2016
$

4,907

(1,499,979)

(892,505)

(2,087,976)

(1,190,561)

(669,931)

148,608

18a

(4,252,981)

(1,929,551)

(25,224)

6,945,778

1,365,639

(158,374)

(59,324)

6,787,404

1,306,315

2,509,199

(623,236)

317,758

(173,997)

2,652,960

943,011

(2,017)

317,758

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE1. STATEMENT OF SIGNIFICANT
ACCOUNTING POLICIES
These are the consolidated financial statements and notes of
Aura Energy Limited and controlled entities (“Consolidated
Group” or “Group”). Aura Energy Limited is a company limited by
shares, domiciled and incorporated in Australia.

The ability of the Group to continue as a going concern
is principally dependent upon the ability of the Group
to secure funds by raising capital from equity markets
or by other means, and by managing cash flows
in line with available funds, and/or the successful
development of the Group’s exploration assets. These
conditions indicate a material uncertainty that may
cast doubt about the ability of the Group to continue
as a going concern.

Based upon cash flow forecasts and other factors
referred to above, the directors are satisfied that the
going concern basis of preparation is appropriate,
including the meeting of exploration commitments. In
addition, given the Group’s history of raising funds to
date, the directors are confident of the Group’s ability to
raise additional funds as and when they are required.

Should the Group be unable to continue as a going
concern it may be required to realise its assets and
extinguish its liabilities other than in the normal
course of business and at amounts different to those
stated in the financial statements.

The financial statements do not include any
adjustments relating to the recoverability and
classification of asset carrying amounts or to the
amount and classification of liabilities that might result
should the Group be unable to continue as a going
concern and meet its debts as and when they fall due.

iv. Use of estimates and judgements

The preparation of financial statements requires
management to make judgements, estimates and
assumptions that affect the application of policies and
reported amounts of assets and liabilities, income and
expenses. These estimates and associated assumptions
are based on historical experience and various
factors that are believed to be reasonable under the
circumstances, the results of which form the basis of
making the judgements about carrying values of assets
and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed
on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is
revised and in any future periods affected.

Judgements made by management in the application
of Australian Accounting Standards that have
significant effect on the financial statements and
estimates with a significant risk of material adjustment
in the next year are discussed in Note 1r Critical
accounting estimates and judgments.

v. Comparative figures

Where required by Accounting Standards comparative
figures have been adjusted to conform with changes in
presentation for the current financial year.

The separate financial statements of the parent entity, Aura
Energy Limited, have not been presented with this financial
report as permitted by the Corporations Act 2001 (Cth).

a. Basis of preparation

i. Statement of compliance

The financial statements are general purpose financial
statements that have been prepared in accordance with
Australian Accounting Standards, including

Australian Accounting Interpretations, other
authoritative pronouncements of the Australian
Accounting Standards Board and the Corporations Act
2001 (Cth).

Australian Accounting Standards set out accounting
policies that the AASB has concluded would result in a
financial report containing relevant and reliable

information about transactions, events and conditions
to which they apply. Compliance with Australian
Accounting Standards ensures that the financial
statements and notes also comply with International
Financial Reporting Standards as issued by the IASB.
Material accounting policies adopted in the preparation
of these financial statements are presented below. They
have been consistently applied unless otherwise stated.

The financial statements were authorised for issue on
29 September 2017 by the directors of the Company.

ii. Financial position

The financial statements have been prepared on
an accruals basis and are based on historical costs
modified, where applicable, by the measurement at fair
value of selected non-current assets, financial assets
and financial liabilities.

iii. Going concern

The Group incurred a loss for the year of $3,690,599
(2016: $1,625,775 and a net cash out-flow from
operating activities of $4,252,981 (2016: $1,929,551)

As at 30 June 2017, the Group had working capital
surplus of $2,026,388 (2016: $297,004 working
capital deficit).

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE1. STATEMENT OF SIGNIFICANT
ACCOUNTING POLICIES (CONT)

b. Principles of consolidation

A controlled entity is any entity over which Aura
Energy Limited has the power to govern the financial
and operating policies so as to obtain benefits from
its activities. In assessing the power to govern, the
existence and effect of holdings of actual and potential
voting rights are considered. A list of controlled entities
is contained in Note 17 Controlled entities in the
financial statements.

All inter-group balances and transactions between
entities in the Consolidated Group, including any
unrealised profits or losses, have been eliminated on
consolidation. Accounting policies of subsidiaries have
been changed where necessary to ensure consistency
with those adopted by the parent entity.

As at reporting date, the assets and liabilities of all
controlled entities have been incorporated into the
consolidated financial statements as well as their
results for the year then ended. Where controlled
entities have entered (left) the Consolidated Group
during the year, their operating results have been
included (excluded) from the date control was
obtained (ceased).

i. Business combinations

Business combinations occur when an acquirer obtains
control over one or more businesses.

A business combination is accounted for by applying
the acquisition method, unless it is a combination
involving entities or businesses under common control.
The business combination will be accounted for from
the date that control is attained, whereby the fair
value of the identifiable assets acquire and liabilities
(including contingent liabilities) assumed is recognised
(subject to certain limited exemptions).

When measuring the consideration transferred in the
business combination, any asset or liability resulting
from a contingent consideration arrangement is
also included. Subsequent to initial recognition,
contingent consideration classified as an asset or
liability is remeasured each reporting period to fair
value, recognising any change to fair value in profit or
loss, unless the change in value can be identified as
existing at acquisition date.

All transaction costs incurred in relation to the
business combination are expensed to the statement
of profit or loss and comprehensive income.

The acquisition of a business may result in the
recognition of goodwill or a gain from a bargain
purchase.

c. Exploration and development expenditure

i. Recognition and measurement

Exploration, evaluation, and development expenditure
incurred is accumulated in respect of each identifiable
area of interest. These costs are only carried forward
to the extent that they are expected to be recouped
through the successful development of the area or
where activities in the area have not yet reached
a stage that permits reasonable assessment of the
existence of economically recoverable reserves.

ii. Subsequent measurement

Accumulated costs in relation to an abandoned area
are written off in full against profit in the year in which
the decision to abandon the area is made.

When production commences, the accumulated costs
for the relevant area of interest will be amortised over
the life of the area according to the rate of depletion of
the economically recoverable reserves.

A regular review is undertaken of each area of interest
to determine the appropriateness of continuing to
capitalise costs in relation to that area of interest.

iii. Site restoration and rehabilitation

Costs of site restoration will be provided over the life
of the project, when such costs are incurred or the
Group becomes liable pursuant to a development
agreement with government agencies. In the
exploration and evaluation phase, all drill holes are
collared and any site disturbance is restored with
the costs incorporated in the costs of exploration
and evaluation. Site restoration costs will include
the dismantling and removal of mining plant,
equipment and building structures, waste removal,
and rehabilitation of the site in accordance with
clauses of the mining permits. Such costs have been
determined using estimates of future costs, current
legal requirements and technology on an undiscounted
basis.

Any changes in the estimates for the costs are
accounted on a prospective basis. In determining
the costs of site restoration, there is uncertainty
regarding the nature and extent of the restoration
due to community expectations and future legislation.
Accordingly the costs have been determined on the
basis that the restoration will be completed within one
year of abandoning the site.

d. Income tax

Current income tax expense charged to the profit or
loss is the tax payable on taxable income calculated
using applicable income tax rates enacted, or
substantially enacted, as at reporting date. Current
tax liabilities (assets) are therefore measured at the
amounts expected to be paid to (recovered from) the
relevant taxation authority.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE1. STATEMENT OF SIGNIFICANT
ACCOUNTING POLICIES (CONT)

Deferred income tax expense reflects movements in
deferred tax asset and deferred tax liability balances
during the year as well as unused tax losses.

Current and deferred income tax expense (income) is
charged or credited outside profit or loss when the tax
relates to items recognised outside profit or loss.

Deferred tax assets and liabilities are ascertained
based on temporary differences arising between the
tax bases of assets and liabilities and their carrying
amounts in the financial statements. Deferred tax
assets also result where amounts have been fully
expensed but future tax deductions are available. No
deferred income tax will be recognised from the initial
recognition of an asset or liability, excluding a business
combination, where there is no effect on accounting or
taxable profit or loss.

Deferred tax assets and liabilities are calculated at
the tax rates that are expected to apply to the period
when the asset is realised or the liability is settled,
based on tax rates enacted or substantively enacted at
reporting date.

Their measurement also reflects the manner in which
management expects to recover or settle the carrying
amount of the related asset or liability.

Deferred tax assets relating to temporary differences
and unused tax losses are recognised only to the
extent that it is probable that future taxable profit will
be available against which the benefits of the deferred
tax asset can be utilised.

Where temporary differences exist in relation to
investments in subsidiaries, branches, associates, and
joint ventures, deferred tax assets and liabilities are
not recognised where the timing of the reversal of the
temporary difference can be controlled and it is not
probable that the reversal will occur in the foreseeable
future.

Current tax assets and liabilities are offset where
a legally enforceable right of set-off exists and it
is intended that net settlement or simultaneous
realisation and settlement of the respective asset and
liability will occur. Deferred tax assets and liabilities
are offset where a legally enforceable right of set-off
exists, the deferred tax assets and liabilities relate to
income taxes levied by the same taxation authority
on either the same taxable entity or different taxable
entities where it is intended that net settlement
or simultaneous realisation and settlement of the
respective asset and liability will occur in future
periods in which significant amounts of deferred tax
assets or liabilities are expected to be recovered or
settled.

Where the Group receives the Australian Government’s
Research and Development Tax Incentive, The Group
accounts for the refundable tax offset under AASB 112.
Funds are received as a rebate through the parent
company’s income tax return and disclosed as such in
Note 5 Income tax.

e. Plant and equipment

i. Recognition and measurement

Each class of plant and equipment is measured at cost
or fair value less, where applicable, any accumulated
depreciation and impairment losses.

The carrying amount of plant and equipment is
reviewed annually by directors to ensure it is not in
excess of the recoverable amount from these assets.
The recoverable amount is assessed on the basis of
the expected net cash flows that will be received from
the assets employment and subsequent disposal. The
expected net cash flows have not been discounted
to their present values in determining recoverable
amounts.

Items of property, plant and equipment are measured
at cost less accumulated depreciation (see below)
and impairment losses (see Note 1m Impairment of
non- financial assets and Note 1c Exploration and
development expenditure).

ii. Depreciation

The depreciable amount of all fixed assets including
building and capitalised lease assets, but excluding
freehold land, is depreciated on a straight line basis
over their useful lives to the Consolidated Group
commencing from the time the asset is held ready for
use. Leasehold improvements are depreciated over the
shorter of either the unexpired period of the lease or
the estimated useful lives of the improvements.

The depreciation rates used for each class of
depreciable assets are:

Plant and equipment

20.00%

Computers

Motor Vehicles

33.00%

25.00%

The assets’ residual values and useful lives are
reviewed, and adjusted if appropriate, at the end of
each reporting period. An asset’s carrying amount is
written down immediately to its recoverable amount
if the asset’s carrying amount is greater than its
estimated recoverable amount.

Gains and losses on disposals are determined by
comparing proceeds with the carrying amount. These
gains and losses are included in the statement of
comprehensive income. When re-valued assets are sold,
amounts included in the revaluation reserve relating to
that asset are transferred to retained earnings.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17

NOTE1. STATEMENT OF SIGNIFICANT
ACCOUNTING POLICIES (CONT)

f. Employee benefits

h. Revenue and other income

Interest revenue is recognised on a proportional basis
taking into account the interest rates applicable to the
financial assets.

For the period ending 30 June 2017 the Company has
three employees.

Management fees are recognised on portion of
completion basis.

i. Defined contribution superannuation funds

A defined contribution plan is a post-employment
benefit plan under which an entity pays fixed
contributions onto a separate entity and will have no
legal or constructive obligation to pay further amounts.
Obligations for contributions to defined contribution
superannuation funds are recognised as an expense
in the income statement as incurred. Prepaid
contributions are recognised as an asset to the extent
that a cash refund or a reduction in future payments is
available.

ii. Short-term benefits

Liabilities for employee benefits for wages, salaries
and annual leave that are expected to be settled
within 12 months of the reporting date represent
present obligations resulting from employees’ services
provided to the reporting date and are calculated at
undiscounted amounts based on remuneration wage
and salary rates that the Company expects to pay at
the reporting date including related on-costs, such as
workers compensation insurance and payroll tax.

Non-accumulating non-monetary benefits, such as
medical care, housing, cars and free or subsidised
goods and services, are expensed based on the net
marginal cost to the Company as the benefits are
taken by the employees.

Gain on disposal of tenements, and revenue from
equipment chargebacks, are recognised on receipt of
compensation.

All revenue is stated net of the amount of value added
taxes (see Note 1i Value-added taxes).

i. Value-added taxes

Value-added taxes (VAT) is the generic term for the
broad-based consumption taxes that the Group is
exposed to such as: Australia (GST); Sweden (MOMS);
and in Mauritanian (VAT).

Revenues, expenses, and assets are recognised net of the
amount of VAT, except where the amount of VAT incurred
is not recoverable from the relevant country’s taxation
authority. In these circumstances the VAT is recognised
as part of the cost of acquisition of the asset or as part
of an item of the expense. Receivables and payables in
the statement of financial position are shown inclusive
of VAT.

Cash flows are presented in the statement of cash
flows on a gross basis, except for the VAT component of
investing and financing activities, which are disclosed as
operating cash flows.

Commitments and contingencies are disclosed net of
the amount of VAT recoverable from, or payable to, the
taxation authority.

iii. Other long-term benefits

j. Leases

Employee benefits payable later than one year have
been measured at the present value of the estimated
future cash outflows to be made for those benefits.

g. Equity-settled compensation

The Group operates an employee share ownership
scheme. Share-based payments to employees are
measured at the fair value of the instruments issued
and amortised over the vesting periods. Share-based
payments to non-employees are measured at the fair
value of goods or services received or the fair value of
the equity instruments issued, if it is determined the
fair value of the goods or services cannot be reliably
measured, and are recorded at the date the goods
or services are received. The corresponding amount
is recorded to the option reserve. The fair value of
options is determined using the Black-Scholes pricing
model. The number of shares and options expected
to vest is reviewed and adjusted at the end of each
reporting period such that the amount recognised
for services received as consideration for the equity
instruments granted is based on the number of equity
instruments that eventually vest.

Leases of fixed assets where substantially all the risks
and benefits incidental to the ownership of the asset,
but not the legal ownership, are transferred to entities
in the Group are classified as finance leases.

Leased assets are depreciated on a straight-line basis
over their estimated useful lives where it is likely that
the Group will obtain ownership of the asset or over the
term of the lease.

Lease payments for operating leases, where substantially
all the risks and benefits remain with the lessor, are
charged as expenses in the periods in which they are
incurred.

Lease incentives under operating leases are recognised
as a liability and amortised on a straight-line basis over
the life of the lease term.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE1. STATEMENT OF SIGNIFICANT
ACCOUNTING POLICIES (CONT)

k. Financial instruments

Initial recognition and measurement

Financial instruments, incorporating financial assets
and financial liabilities, are recognised when the entity
becomes a party to the contractual provisions of the
instrument. Trade date accounting is adopted for
financial assets that are delivered within timeframes
established by marketplace convention.

Financial instruments are initially measured at fair
value plus transactions costs where the instrument
is not classified as at fair value through profit or loss.
Transaction costs related to instruments classified as at
fair value through profit or loss are expensed to profit
or loss immediately.

The Group does not designate any interests in
subsidiaries, associates or joint venture entities as
being subject to the requirements of accounting
standards specifically applicable to financial
instruments.

ii. Non-derivative financial instruments

Non-derivative financial instruments comprise
investments in equity securities, trade and other
receivables, cash and cash equivalents and trade and
other payables.

Non-derivative financial instruments are recognised
initially at fair value plus, for instruments not at fair
value through profit or loss, any directly attributable
transactions costs. Subsequent to initial recognition
non-derivative financial instruments are measured as
described below.

iii. Classification and subsequent measurement

(1) Cash and cash equivalents

Cash and cash equivalents includes cash on hand,
deposits held at call with banks, other short-term
highly liquid investments with original maturities
of three months or less, and bank overdrafts. Bank
overdrafts are shown within short-borrowings in
current liabilities on the Statement of financial
position.

(2) Loans

Loans are non-derivative financial assets with fixed
or determinable payments that are not quoted in
an active market and are subsequently measured at
amortised cost. Gains or losses are recognised in profit
or loss through the amortisation process and when the
financial asset is derecognised.

Loans are included in current assets, except for those
which are not expected to mature within 12 months
after the end of the reporting period.

(3) Trade and other receivables

Trade and other receivables are stated at amortised
cost. Receivables are usually settled within 30 to
90 days.

Collectability of trade and other debtors is reviewed
on an ongoing basis. An impairment loss is recognised
for debts which are known to be uncollectible. An
impairment provision is raised for any doubtful
amounts.

(4) Trade and other payables

Trade payables and other payable are recognised when
the Group becomes obligated to make future payments
resulting from the purchase of goods and services
which are unpaid and stated at their amortised cost.
The amounts are unsecured and are generally settled
on 30 day terms.

(5) Financial liabilities

Non-derivative financial liabilities (excluding financial
guarantees) are subsequently measured at amortised
cost.

(6) Share capital

Ordinary issued capital is recorded at the consideration
received. Incremental costs directly attributable to
the issue of ordinary shares and share options are
recognised as a deduction from equity, net of any
related income tax benefit. Ordinary issued capital
bears no special terms or conditions affecting income
or capital entitlements of the shareholders.

iv. Amortised cost

Amortised cost is calculated as the amount at which
the financial asset or financial liability is measured
at initial recognition less principal repayments and
any reduction for impairment, and adjusted for any
cumulative amortisation of the difference between
that initial amount and the maturity amount calculated
using the effective interest method.

v. Fair value

Fair value is determined based on current bid prices
for all quoted investments. Valuation techniques are
applied to determine the fair value for all unlisted
securities, including recent arm’s length transactions,
reference to similar instruments and option pricing
models.

vi. Effective interest method

The effective interest method is used to allocate
interest income or interest expense over the relevant
period and is equivalent to the rate that discounts
estimated future cash payments or receipts (including
fees, transaction costs and other premiums or
discounts) over the expected life (or when this cannot
be reliably predicted, the contractual term) of the
financial instrument to the net carrying amount of
the financial asset or financial liability. Revisions to
expected future net cash flows will necessitate

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE1. STATEMENT OF SIGNIFICANT
ACCOUNTING POLICIES (CONT)

an adjustment to the carrying amount with a
consequential recognition of an income or expense
item in profit or loss.

vii. Impairment

A financial asset is assessed at each reporting date
to determine whether there is any objective evidence
that it is impaired. 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 the income
statement.

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 the income statement.

viii. Derecognition

Financial assets are derecognised where the
contractual rights to cash flow expires or the asset
is transferred to another party whereby the entity no
longer has any significant continuing involvement
in the risks and benefits associated with the asset.
Financial liabilities are derecognised where the
related obligations are either discharged, cancelled
or expired. The difference between the carrying value
of the financial liability extinguished or transferred to
another party and the fair value of consideration paid,
including the transfer of non-cash assets or liabilities
assumed, is recognised in profit or loss.

ix. Financial income and expenses

Finance income comprises interest income on funds
invested (including available-for-sale financial assets),
gains on the disposal of available-for-sale financial
assets and changes in the fair value of financial assets
at fair value through profit or loss. Interest income
is recognised as it accrues in profit or loss, using the
effective interest method.

Financial expenses comprise interest expense on
borrowings calculated using the effective interest
method, unwinding of discounts on provisions, changes
in the fair value of financial assets at fair value through
profit or loss and impairment losses recognised on

financial assets. All borrowing costs are recognised in
profit or loss using the effective interest method.

Borrowing costs directly attributable to the acquisition,
construction or production of assets that necessarily
take a substantial period of time to prepare for their
intended use or sale, are added to the cost of those
assets, until such time as the assets are substantially
ready for their intended use or sale. All other borrowing
costs are recognised in income in the period in which
they are incurred.

Foreign currency gains and losses are reported on a
net basis.

l. Earnings per share

i. Basic earnings per share

Basic earnings (or loss) per share is determined by
dividing the profit or loss attributable to equity holders
of the parent company, excluding any costs of service
equity other than ordinary shares, by the weighted
average number of ordinary shares outstanding during
the financial year, adjusted for bonus elements in
ordinary shares issued during the year.

ii. Diluted earnings per share

Diluted earnings (or loss) per share is determined by
adjusting the profit or loss attributable to ordinary
shareholders and the weighted average number of
ordinary shares outstanding for the effects of all
dilutive potential ordinary shares which comprise share
options granted as share-based payments.

The Group does not report diluted earnings per share,
as dilution is not applied to annual losses generated by
the Group.

m. Impairment of non-financial assets

The carrying amounts of the Company’s non-financial
assets, other than deferred tax assets (Note 1d Income
tax) and exploration and evaluation assets (Note
1c Exploration and development expenditure) 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. Impairment losses are recognised in the
income statement, unless the asset has previously
been revalued, in which case the impairment loss is
recognised as a reversal to the extent of that previous
revaluation with any excess recognised through the
income statement. Impairment losses recognised in
respect of cash-generating units are allocated first to
reduce the carrying amount of any goodwill allocated
to the units and then to reduce the carrying amount of
the other assets in the unit on a pro rata basis.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE1. STATEMENT OF SIGNIFICANT
ACCOUNTING POLICIES (CONT)

The recoverable amount of an asset or cash-generating
unit is the greater of its fair value less costs to sell and
value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current
market assessments of the time value of money
and the risks specific to the asset. For an asset that
does not generate largely independent cash inflows,
the recoverable amount is determined for the cash-
generating unit to which the asset belongs.

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 and amortisation, if no
impairment loss had been recognised.

n. Provisions

Provisions are recognised when the Group has a legal
or constructive obligation, as a result of past events,
for which it is probable that an outflow of economic
benefits will results and that outflow can be reliably
measured.

o. Foreign currency transactions and balances

i. Functional and presentation currency

The functional currency of each of the Group’s
entities is measured using the currency of the primary
economic environment in which that entity operates.
The consolidated financial statements are presented
in Australian dollars which is the parent entity’s
functional and presentation currency.

ii. Transaction and balances

Foreign currency transactions are translated into
functional currency using the exchange rates
prevailing at the date of the transaction. Foreign
currency monetary items are translated at the year-
end exchange rate. Non-monetary items measured at
historical cost continue to be carried at the exchange
rate at the date of the transaction. Non-monetary items
measured at fair value are reported at the exchange
rate at the date when fair values were determined.

Exchange differences arising on the translation of
monetary items are recognised in the profit or loss
except where deferred in equity as a qualifying cash
flow or net investment hedge.

Exchange differences arising on the translation of
non-monetary items are recognised directly in other
comprehensive income to the extent that the gain
or loss is directly recognised in other comprehensive
income, otherwise the exchange difference is
recognised in the profit or loss.

iii. Group companies

The financial results and position of foreign operations
whose functional currency is different from the Group’s
presentation currency are translated as follows:

Assets and liabilities are translated at year-end
exchange rates prevailing at that reporting date.

Income and expenses are translated at average
exchange rates for the period.

Retained earnings are translated at the exchange rates
prevailing at the date of the transaction.

Exchange differences arising on translation of foreign
operations are transferred directly to the Group’s
foreign currency translation reserve in the statement of
financial position. These differences are recognised in
the profit or loss in the period in which the operation
is disposed.

p. Fair value estimation

A number of the Group’s accounting policies and
disclosures require the determination of fair value,
for both financial and non-financial assets and
liabilities. Information about the assumptions made
in determining fair values of assets and liabilities is
disclosed in the notes specific to that asset or liability.

q. Fair value of assets and liabilities

The Group measures some of its assets and liabilities
at fair value on either a recurring or non-recurring
basis, depending on the requirements of the applicable
Accounting Standard.

Fair value is the price the Group would receive to sell
an asset or would have to pay to transfer a liability
in an orderly (i.e. unforced) transaction between
independent, knowledgeable and willing market
participants at the measurement date.

As fair value is a market-based measure, the closest
equivalent observable market pricing information
is used to determine fair value. Adjustments to
market values may be made having regard to the
characteristics of the specific asset or liability. The fair
values of assets and liabilities that are not traded in
an active market are determined using one or more
valuation techniques. These valuation techniques
maximise, to the extent possible, the use of observable
market data.

To the extent possible, market information is extracted
from either the principal market for the asset or
liability (i.e. the market with the greatest volume and
level of activity for the asset or liability) or, in the
absence of such a market, the most advantageous
market available to the entity at the end of the
reporting period (i.e. the market that maximises the
receipts from the sale of the asset or minimises the
payments made to transfer the liability, after taking
into account transaction costs and transport costs).

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE1. STATEMENT OF SIGNIFICANT
ACCOUNTING POLICIES (CONT)

For non-financial assets, the fair value measurement
also takes into account a market participant’s ability to
use the asset in its highest and best use or to sell it to
another market participant that would use the asset in
its highest and best use.

The fair value of liabilities and the entity’s own equity
instruments (excluding those related to share-based
payment arrangements) may be valued, where there
is no observable market price in relation to the
transfer of such financial instruments, by reference
to observable market information where such
instruments are held as assets. Where this information
is not available, other valuation techniques are
adopted and, where significant, are detailed in the
respective note to the financial statements.

i. Valuation techniques

In the absence of an active market for an identical
asset or liability, the Group selects and uses one or
more valuation techniques to measure the fair value
of the asset or liability, the Group selects a valuation
technique that is appropriate in the circumstances
and for which sufficient data is available to measure
fair value. The availability of sufficient and relevant
data primarily depends on the specific characteristics
of the asset or liability being measured. The valuation
techniques selected by the Group are consistent with
one or more of the following valuation approaches:

(1) Market approach: valuation techniques that use

prices and other relevant information generated by
market transactions for identical or similar assets
or liabilities.

(2) Income approach: valuation techniques that

convert estimated future cash flows or income and
expenses into a single discounted present value.

(3) Cost approach: valuation techniques that reflect
the current replacement cost of an asset at its
current service capacity.

Each valuation technique requires inputs that reflect
the assumptions that buyers and sellers would
use when pricing the asset or liability, including
assumptions about risks. When selecting a valuation
technique, the Group gives priority to those techniques
that maximise the use of observable inputs and
minimise the use of unobservable inputs. Inputs that
are developed using market data (such as publicly
available information on actual transactions) and
reflect the assumptions that buyers and sellers would
generally use when pricing the asset or liability are
considered observable, whereas inputs for which
market data is not available and therefore are
developed using the best information available about
such assumptions are considered unobservable.

ii. Fair value hierarchy

AASB 13 requires the disclosure of fair value
information by level of the fair value hierarchy, which
categorises fair value measurements into one of three
possible levels based on the lowest level that an
input that is significant to the measurement can be
categorised into as follows:

(1) Level 1

Measurements based on quoted prices (unadjusted) in
active markets for identical assets or liabilities that the
entity can access at the measurement date.

(2) Level 2

Measurements based on inputs other than quoted
prices included in Level 1 that are observable for the
asset or liability, either directly or indirectly.

(3) Level 3

Measurements based on unobservable inputs for the
asset or liability.

The fair values of assets and liabilities that are not
traded in an active market are determined using one or
more valuation techniques. These valuation techniques
maximise, to the extent possible, the use of observable
market data. If all significant inputs required to
measure fair value are observable, the asset or liability
is included in Level 2. If one or more significant inputs
are not based on observable market data, the asset or
liability is included in Level 3.

The Group would change the categorisation within
the fair value hierarchy only in the following
circumstances:

•

if a market that was previously considered active
(Level 1) became inactive (Level 2 or Level 3) or
vice versa or

if significant inputs that were previously
unobservable (Level 3) became observable (Level 2)
or vice versa.

When a change in the categorisation occurs, the Group
recognises transfers between levels of the fair value
hierarchy (i.e. transfers into and out of each level of the
fair value hierarchy) on the date the event or change in
circumstances occurred.

r. Critical accounting estimates and judgements

The directors evaluate estimates and judgements
incorporated into the financial report based on
historical knowledge and best available current
information.

Estimates assume a reasonable expectation of future
events and are based on current trends and economic
data, obtained both externally and within the Group.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE1. STATEMENT OF SIGNIFICANT
ACCOUNTING POLICIES (CONT)

i. Key Judgements – Exploration and evaluation

expenditure

Exploration and evaluation costs are carried forward
where right of tenure of the area of interest is current.
These costs are carried forward in respect of an area
that has not at reporting date reached a stage that
permits reasonable assessment of the existence
of economically recoverable reserves, refer to the
accounting policy stated in Note 1c Exploration and
development expenditure.

The carrying value of capitalised expenditure at
reporting date is $14,851,820 (2016: $14,137,710).

During the financial year, the Group undertook
assessment of its tenement assets, as a result of this
assessment, the Group decided to impair some of its
exploration assets. Refer to Note 11 Exploration and
evaluation assets.

ii. Key Judgements – Environmental issues

Balances disclosed in the financial statements and
notes thereto are not adjusted for any pending or
enacted environmental legislation, and the directors
understanding thereof. At the current stage of the
Company’s development and its current environmental
impact, the directors believe such treatment is
reasonable and appropriate.

iii. Key Estimate – Taxation

Balances disclosed in the financial statements and the
notes thereto, related to taxation, are based on the
best estimates of directors. These estimates take into
account both the financial performance and position
of the Company as they pertain to current income
taxation legislation, and the directors understanding
thereof.

No adjustment has been made for pending or future
taxation legislation. The current income tax position
represents that directors’ best estimate, pending an
assessment by tax authorities in relevant jurisdictions.
Refer to Note 5 Income tax.

iv. Key Estimate — Impairment

The Group assesses impairment at each reporting date
by evaluating conditions specific to the Group that may
lead to impairment of assets. Where an impairment
trigger exists, the recoverable amount of the asset is
determined.

v. Key Estimate – Share-based payments

The Group measures the cost of equity-settled
transactions with employees by reference to the fair
value of the equity instruments at the date at which
they are granted. The fair value is determined by an
internal valuation using a Black-Scholes option pricing
model, using the assumptions detailed in Note 19
Share-based payments.

s. New standards, interpretations and amendments adopted by

the Group

The accounting policies adopted in the preparation of the
interim condensed consolidated financial statements are
consistent with those followed in the preparation of the
Group’s annual consolidated financial statements for the
year ended 31 December 2016, except for the adoption
of new standards and interpretations effective as of 1
January 2017. The nature and the effect of these changes
are discussed below. Although these amendments apply
for the first time in 2017, they do not have a material
impact on the interim condensed financial statements
of the Group. The nature and the impact of each new
amendment is described below:

i. AASB 2016-1 Amendments to Australian Accounting
Standards – Recognition of Deferred Tax Assets for
Unrealised Losses

The amendments clarify that an entity needs to consider
whether tax law restricts the sources of taxable profits
against which it may make deductions on the reversal
of that deductible temporary difference. Furthermore,
the amendments provide guidance on how an entity
should determine future taxable profits and explain the
circumstances in which taxable profit may include the
recovery of some assets for more than their carrying
amount. Entities are required to apply the amendments
retrospectively. However, on initial application of the
amendments, the change in the opening equity of
the earliest comparative period may be recognised in
opening retained earnings (or in another component
of equity, as appropriate), without allocating the
change between opening retained earnings and other
components of equity. Entities applying this relief must
disclose that fact. These amendments are effective for
annual periods beginning on or after 1 January 2017
with early application permitted. If an entity applies the
amendments for an earlier period, it must disclose that
fact. The adoption of these amendments had no material
impact on the financial position or performance of the
Group.

i. AASB 2016-2 Amendments to Australian Accounting

Standards – Disclosure Initiative: Amendments to AASB 107

The amendments to IAS 7 Statement of Cash Flows are
part of the IASB’s Disclosure Initiative and require an
entity to provide disclosures that enable users of financial
statements to evaluate changes in liabilities arising from
financing activities, including both changes arising from
cash flows and non-cash changes. On initial application
of the amendment, entities are not required to provide
comparative information for preceding periods. These
amendments are effective for annual periods beginning
on or after 1 January 2017, with early application
permitted. Application of amendments will result in
additional disclosure provided by the Group in the Group’s
annual financial statements ending 31 December 2017.

The Group has not early adopted any other standard,
interpretation or amendment that has been issued but is
not yet effective.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 2. REVENUE AND OTHER INCOME

Revenue

Interest received from financial institutions

Total Revenue

NOTE 3. LOSS BEFORE INCOME TAX

The following significant expense items are relevant in explaining the financial performance:

Superannuation expense

NOTE 4. AUDITOR’S REMUNERATION

Remuneration of the auditor of the Group for:

Auditing or reviewing the financial reports

Taxation services provided by a related practice of the auditor

Other services

2017
$

4,905

2016
$

4.907

4,907

2017
$

2016
$

36,838

36,200

2017
$

40,860

1,550

9,000

51,410

2016
$

37,000

2,085

20,000

59,085

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 5. INCOME TAX

Income tax expense/(benefit)

Current tax

Deferred tax

Tax rebate for research and development

NOTES

2017
$

2016
$

(148,608)

Deferred income tax expense included in income tax expense comprises:

Increase/(decrease) in deferred tax assets

(Increase)/decrease in deferred tax liabilities

Reconciliation of income tax expense to prima facie tax payable

The prima facie tax payable/(benefit) on loss from ordinary activities before income tax
is reconciled to the income tax expense as follows:

Prima facie tax on operating loss at 30% (2016: 30%)

(1,107,180)

(487,733)

Add/(less)

Tax effect of:

Capital-raising costs deductible

Impairment of exploration expenditure previously capitalised

Share-based payments

Write-off of exploration assets

Other

Deferred tax asset not brought to account

Income tax expense/(benefit) attributable to operating loss

Less rebates:

Tax rebate for research and development

Income tax expense/(benefit)

The applicable weighted average effective tax rates attributable to operating profit
are as follows

Balance of franking account at year end

140,608

419,281

20,556

(52,199)

578,925

Nil

(24,749)

47,594

15,438

2,451

446,999

(148,608)

Nil

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 5. INCOME TAX (CONT)

Deferred tax assets

Tax losses

Provisions and accruals

Other

Set-off deferred tax liabilities

Net deferred tax assets

Less deferred tax assets not recognised

Net tax assets

Deferred tax liabilities

Exploration expenditure

Set-off deferred tax assets

Net deferred tax liabilities

Tax losses

Unused tax losses for which no deferred tax asset has been recognised, that may be
utilised to offset tax liabilities:

Revenue losses

Capital losses

NOTE

2017
$

2016
$

4,174,499

3,895,970

21,697

99,869

41,173

15,019

4,296,066

3,952,162

4,296,066

3,952,162

(4,296,066)

(3,952,162)

14,345,219

12,482,130

2,083,905

691,104

16,429,124

13,173,234

Potential deferred tax assets attributable to tax losses and exploration expenditure carried forward have not been brought to
account at 30 June 2017 because the directors do not believe it is appropriate to regard realisation of the deferred tax assets as
probable at this point in time. These benefits will only be obtained if:

i. The Group derives future assessable income of a nature and of an amount sufficient to enable the benefit from the deductions

for the loss and exploration expenditure to be realised.

ii. The Group continues to comply with conditions for deductibility imposed by law.

iii. No changes in tax legislation adversely affect the Group in realising the benefit from the deductions for the loss and

exploration expenditure.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 6. EARNINGS PER SHARE

a. Loss from continuing operations for the year

NOTE

2017
$

2016
$

(3,690,599)

(1,625,775)

2017
NO.

2016
NO.

b. Weighted average number of ordinary shares outstanding during the year used

in calculation of basic EPS

692,642,263

398,625,406

c. Basic and diluted earnings per share (cents per share)

2017
¢

(0.53)

2016
¢

(0.41)

i. The Group is in a loss making position and it is unlikely that the conversion to, calling of, or subscription for, ordinary share
capital in respect of potential ordinary shares would lead to diluted earnings per share that shows an inferior view of the
earnings per share. Therefore in the event the Company has dilutionary equity instruments on issue, the diluted loss per share
for the year ended 30 June 2017 is the same as basic loss per share, whilst the Company remains loss making.

ii. There are 80,803,189 (2016: 177,249,702) options over ordinary shares that have vested.

NOTE 7. CASH AND CASH EQUIVALENTS

Cash at bank

Short-term bank deposits

NOTE

2017
$

2016
$

2,614,749

317,758

38,211

2,652,960

317,758

a. The Group’s exposure to interest rate risk and a sensitivity analysis for financial assets and liabilities

are disclosed in Note 24 Financial risk management.

NOTE 8. TRADE AND OTHER RECEIVABLES

Current

Value-added tax receivable

Trade debtors

Other

Less: Provision for impairment

NOTE

2017
$

62,854

2016
$

43,346

18,782

648

(5,068)

57,708

a. Value-added tax (VAT) is a generic term for the broad-based consumption taxes that the Group is exposed to such as:

Australia (GST); Sweden (MOMS); and in Mauritanian (VAT).

b. The Group’s exposure to interest rate risk and a sensitivity analysis for financial assets and liabilities are disclosed in

Note 24 Financial risk management.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 9. FINANCIAL ASSETS

Current

Bonds and prepayments

NOTE 10. PLANT AND EQUIPMENT

Non-current

Plant and equipment

Accumulated depreciation

Motor vehicles

Accumulated depreciation

Total plant and equipment

Movements in carrying amounts

Balance at the beginning of year

Additions

Depreciation expense

Carrying amount at the end of year

2017
$

2016
$

80,897

43,625

2017
$

25,224

(6,319)

18,905

25,224

(6,319)

18,905

2016
$

160,102

(160,102)

1,602

(1,602)

NOTE 11. EXPLORATION AND EVALUATION ASSETS

Non-current

Exploration expenditure capitalised:

Exploration and evaluation phase at cost

Add:

Effect of exchange rate changes on exploration and evaluation assets

Less: Exploration expenditure impairment

Net carrying value

a. The value of the Group interest in exploration expenditure is dependent upon:

• The continuance of the Group’s rights to tenure of the areas of interest.

• The results of future exploration.

NOTE

2017
$

2016
$

16,442,768

14,099,992

(193,346)

(37,718)

11b

11a,b

(1,397,602)

14,851,820

14,137,710

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• The recoupment of costs through successful development and exploitation of the areas of interest, or alternatively,

by their sale.

The Group’s exploration properties may be subjected to claim(s) under Native Title (or jurisdictional equivalent), or contain
sacred sites, or sites of significance to the indigenous people of Sweden and Mauritania.

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 quantify whether such claims exist, or the quantum of such
claims.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 11. EXPLORATION AND EVALUATION ASSETS (CONT)

b. The Group has recorded an impairment to the carrying value of its Mauritanian and Swedish tenements for the financial year

ended 30 June 2017 of $1,397,602 (2016: nil).

This impairment for the financial year arose from the group relinquishing tenements in Mauritania $495,433 and Sweden
$897,368. The Group also recorded an impairment of $4,801 on an entity it placed into voluntary liquidation during the course
of the financial year.

NOTE 12. TRADE AND OTHER PAYABLES

Current

Unsecured

Trade payables

Accrued expenses

Other taxes payable

NOTE

12a

2017
$

2016
$

333,684

165,282

77,639

576,605

242,496

257,527

50,821

550,844

a. Trade payables are non-interest bearing and arise from the usual operating activities of the Group. Trade payables and other

payables and accruals, except directors’ fees, are usually settled within the lower of terms of trade or 30 days.

b. The Group’s exposure to interest rate risk and a sensitivity analysis for financial assets and liabilities are disclosed in Note 24

Financial risk management.

NOTE 13. SHORT-TERM PROVISIONS

Current

Employee benefits

Number of employees at year end

NOTE 14. OTHER FINANCIAL LIABILITIES

Current

Share Sale Facility

2017
$

2016
$

118,948

165,251

2017
NO.

2017
$

47,803

2016
NO.

2016
$

On 10 February 2017 the Company established a Share Sale facility which enabled shareholders with unmarketable parcels to
sell their shares with the Company bearing the costs of the sale. At balance date, the Company held $47,803 in proceeds from the
Share sale facility which was distributed to shareholders on 21 July 2017.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 15. ISSUED CAPITAL

The Company has issued share capital amounting to 792,808,124
(2016: 457,048,412 fully paid ordinary shares at no par value.

a. Equity raised during the financial year

At the beginning of the reporting period

Shares issued during the year:

48,660,000 Shares issued on 29 September 2015

851,442 Shares issued on 15 October 2015

13,451,801 Shares issued on 25 November 2015

1,008,004 Shares issued on 9 December 2015

3,267,311 Shares issued on 14 December 2015

8,163,265 Shares issued on 15 December 2015

18,755,093 Shares issued on 12 February 2016

1,224,500 Shares issued on 12 February 2016

716,667 Shares issued on 18 February 2016

22,943,877 Shares issued on 10 May 2016

1,074,615 Shares issued on 10 May 2016

1,099,578 Shares issued on 10 May 2016

766,476 Shares issued on 10 May 2016

196,883,849 Shares issued on 12 September 2016

3,937,677 Shares issued on 12 September 2016

53,250,000 Shares issued on 16 September 2016

200,000 Shares issued on 16 September 2916

4,581,633 Shares issued on 6 October 2016

500,000 Shares issued on 19 October 2016

871,335 Shares issued on 21 December 2016

559,623 Shares issued on 21 December 2016

1,882,845 Shares issued on 21 December 2016

62,111,801 Shares issued on 8 February 2017

6,530,612 Shares issued on 8 February 2017

4,000,000 Shares issued on 23 February 2017

450,337 Shares issued on 5 April 2017

Transaction costs relating to share issues

At reporting date

NOTE

2017
$

2016
$

15a

39,558,943

32,784,203

31,311,988

15a.i

15a.ii

15a.iii

15a.iv

15a.v

15a.vi

15a.vii

15a.viii

15a.ix

15a.x

15a.xi

15a.xii

15a.xiii

15a.xiv

15a.xv

15a.xvi

15a.xvii

15a.xviii

15a.xix

15a.xx

15a.xxi

15a.xxii

15a.xxiii

15a.xxiv

15a.xxv

15a.xxvi

596,085

18,253

164,785

18,253

60,000

100,000

229,750

15,000

35,000

281,062

30,000

18,253

13,375

3,937,877

78,754

1,065,000

4,000

114,541

12,500

13,375

45,000

1,552,795

163,265

100,000

13,375

(338,917)

(107,601)

39,558,943

32,784,203

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE

15a.i

15a.ii

15a.iii

15a.iv

15a.v

15a.vi

15a.vii

15a.viii

15a.ix

15a.x

15a.xi

15a.xii

15a.xiii

2017
NO.

2016
NO.

457,048,412

335,065,783

48,660,000

851,442

13,451,801

1,008,004

3,267,311

8,163,265

18,755,093

1,224,500

716,667

22,943,877

1,074,615

1,099,578

766,476

15a.xiv

196,883,849

15a.xv

3,937,677

15a.xvi

53,250,000

15a.xvii

200,000

15a.xviii

4,581,633

15a.xix

15a.xx

15a.xxi

500,000

871,335

559,623

15a.xxii

1,882,845

15a.xxiii

62,111,801

15a.xxiv

6,530,612

15a.xxv

4,000,000

15a.xxvi

450,337

792,808,124

457,048,412

NOTE 15. ISSUED CAPITAL (CONT)

At the beginning of the reporting period

Ordinary shares issued during the financial year:

48,660,000 Shares issued on 29 September 2015

851,442 Shares issued on 15 October 2015

13,451,801 Shares issued on 25 November 2015

1,008,004 Shares issued on 9 December 2015

3,267,311 Shares issued on 14 December 2015

8,163,265 Shares issued on 15 December 2015

18,755,093 Shares issued on 12 February 2016

1,224,500 Shares issued on 12 February 2016

716,667 Shares issued on 18 February 2016

22,943,877 Shares issued on 10 May 2016

1,074,615 Shares issued on 10 May 2016

1,099,578 Shares issued on 10 May 2016

766,476 Shares issued on 10 May 2016

196,883,849 Shares issued on 12 September 2016

3,937,677 Shares issued on 12 September 2016

53,250,000 Shares issued on 16 September 2016

200,000 Shares issued on 16 September 2916

4,581,633 Shares issued on 6 October 2016

500,000 Shares issued on 19 October 2016

871,335 Shares issued on 21 December 2016

559,623 Shares issued on 21 December 2016

1,882,845 Shares issued on 21 December 2016

62,111,801 Shares issued on 8 February 2017

6,530,612 Shares issued on 8 February 2017

4,000,000 Shares issued on 23 February 2017

450,337 Shares issued on 5 April 2017

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 15. ISSUED CAPITAL (CONT)
i.

Issued pursuant to Share Placement (through WH Ireland Limited)

ii.

iii.

iv.

vi.

vii.

viii.

ix.

xi.

xii.

xiii.

xiv.

xv.

xvi.

Issued to Executive Chairman/Managing Director pursuant to Contract of Employment

Issued pursuant to Share Placement (through WH Ireland Limited)

Issued to Executive Chairman/Managing Director pursuant to Contract of Employment

Issued pursuant to Engagement Letter between the Company and Hartley Limited

Issued pursuant to Share Placement to ASOF

Issued pursuant to Share Placement

Issued pursuant to conversion By ASOP of convertible notes into fully paid ordinary shares

Issued pursuant to conversion by ASOP of convertible notes into fully paid ordinary shares

Issued of shares to sophisticated and professional investors for working capital

Issued pursuant to Engagement Letter between Company and Hartley Limited

Issued to Executive Chairman/Managing Director pursuant to Contract of Employment

Issued on AIM admission

Issued pursuant to Letter of Engagement to WHI Ireland as commission for AIM Listing

Issued pursuant to Australian Placement

xvii.

Issued pursuant to Letter of Engagement to Australian brokers as commission for Placement

xviii. Exercise of options over ordinary shares expiring 5 February 2018

xix.

xx.

xxi.

Exercise of options over ordinary shares expiring 5 February 2018

Issued to Executive Chairman/Managing Director pursuant to Contract of Employment.

xxii.

Issued to Consultant pursuant to Letter of Engagement

xxiii. Exercise of options over ordinary shares expiring 25 November 2017

xxiv.

Exercise of options over ordinary shares expiring 9 May 2018

xxv.

Exercise of options over ordinary shares expiring 9 May 2018

xxvi.

Issued to Executive Chairman/Managing Director pursuant to Contract of Employment

b. Options

For information relating to the Aura Energy Limited employee options scheme, including details of options issued, issued and
lapsed during the financial year, and the options outstanding at balance date, refer to Note 19 Share-based payments. The
total number of options on issue is as follows:

Listed options

Unlisted options

2017
NO.

2016
NO.

27,226,166

89,553,189

170,123,536

89,553,189

197,349,702

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 15. ISSUED CAPITAL (CONT)

c. Capital Management

i. Capital management policy

The directors’ objectives when managing capital are to ensure that the Group can fund its operations and continue as a
going concern, so that they may continue to provide returns for shareholders and benefits for other stakeholders.

Due to the nature of the Group’s activities, being mineral exploration, the Group does not have ready access to credit
facilities, with the primary source of funding being equity raisings. Therefore, the focus of the Group’s capital risk
management is the current working capital position against the requirements of the Group to meet exploration
programmes and corporate overheads.

The Group’s strategy is to ensure appropriate liquidity is maintained to meet anticipated operating requirements, with a
view to initiating appropriate capital raisings as required.

ii. Current ratio

The current ratio the Group at 30 June 2017 and 30 June 2016 was as follows:

Current ratio

iii. Working capital position

The working capital position of the Group at 30 June 2017 and 30 June 2016 was as follows:

NOTE

Cash and cash equivalents

Trade and other receivables

Financial assets

Trade and other payables

Financial liabilities

Short-term provisions

Working capital surplus / (deficit)

NOTE 16. RESERVES

Option reserve

Foreign exchange reserve

a. Option reserve

NOTE

16a

16b

2017
NO.

3.76

2017
NO.

2016
NO.

0.58

2016
NO.

2,652,960

317,758

62,854

80,897

57,708

43,625

(576,605)

(550,844)

(47,803)

(118,948)

(165,251)

2,053,355

(297,004)

2017
$

457,481

384,190

2016
$

495,651

533,891

841,671

1,029,542

The option reserve records items recognised as expenses on the value of employee and consultant share options.

b. Foreign exchange translation reserve

The foreign exchange reserve records exchange differences arising on translation of foreign controlled subsidiary.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 17. CONTROLLED ENTITIES

CONTROLLED ENTITIES

Aura Energy Sweden AB

Aura Energy Mauritania Pty Limited

Tiris Ressources SA

GCM Africa Uranium Limited

Tiris International Mining Company sarl

COUNTRY OF
INCORPORATION

Sweden

Australia

Mauritania

United Kingdom

Mauritania

CLASS OF SHARES

Ordinary

PERCENTAGE OWNED

2017

100%

90%

100%

2016

100%

Investments in subsidiaries are accounted for at cost.

During the financial year, the Company acquired Tiris International Mining Company Sarl for $133,811. This entity has applied
for gold tenements in Mauritania.

The Company also liquidated its non operating UK controlled entity, GCM Africa Uranium Limited during the financial year.

NOTE 18. CASH FLOW INFORMATION

a. Reconciliation of cash flow from operations to loss after income tax

Loss after income tax

Cash flows excluded from profit attributable to operating activities

Non-cash flows in profit from ordinary activities:

Share-based payments expense

Payments to employees and corporate advisor by way of shares

Net interest on convertible notes

Depreciation

Effects of foreign exchange on translation

Impairment of exploration expenditure previously capitalised

2017
$

2016
$

(3,690,599)

(1,625,775)

69,552

135,125

6,319

173,997

1,397,602

158,645

158,134

6,960

1,602

2,017

Capitalised exploration expenditure included in cash flows from operations

(2,087,976)

(1,110,965)

Other

Changes in assets and liabilities, net of the effects of purchase and disposal of subsidiaries:

(Increase)/decrease in receivables and prepayments

(Decrease)/Increase in trade and other payables

(Decrease)/Increase in provisions

Cash flow from operations

b. Credit standby facilities

The Group has no credit standby facilities.

c. Non-Cash Investing and Financing Activities

The Group has no non-cash investing and financing activities.

d. Restrictions on Cash Balance

The Group does not have any restrictions over its cash balance.

(2,086)

(208,613)

(46,302)

14,845

438,374

26,612

(4,252,981)

(1,929,551)

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17

NOTE 19. SHARE-BASED PAYMENTS

Share-based payment expense

2017
$

2016
$

69,552

158,645

a. The above share-based payment expense is comprised of the following arrangements in place at 30 June 2017:

On 9 June 2015, the following options over ordinary shares were granted to the Executive Chairman and Managing Director of
the Company in the following tranches:

• 8,750,000 at an exercise price of $0.10 each. The options are exercisable on or before 9 June 2018.

• 6,250,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 February 2019.

• 2,500,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 June 2019.

• 8,750,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 June 2020.

• 8,750,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 June 2021.

$69,552 was the deemed cost of the options over ordinary shares for the financial year.

The options over ordinary shares hold no voting or dividend rights and are not transferable. At balance date, no options over
ordinary shares have been exercised or forfeited and the 35,000,000 options over ordinary shares remain.

b. The above share-based payment expense is comprised of the following arrangements in place at 30 June 2016:

On 9 June 2015, the following options over ordinary shares were granted to the Executive Chairman and Managing Director of
the Company in the following tranches:

• 8,750,000 at an exercise price of $0.10 each. The options are exercisable on or before 9 June 2018.

• 6,250,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 February 2019.

• 2,500,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 June 2019.

• 8,750,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 June 2020.

• 8,750,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 June 2021.

The options over ordinary shares hold no voting or dividend rights and are not transferable. Share-based payments recognised
directly in equity and in place at 30 June 2016.

c. Movement in share-based payment arrangements during the period

A summary of the movements of all Company options issued as share-based payments is as follows:

2017

2016

NUMBER OF
OPTIONS

WEIGHTED
AVERAGE EXERCISE
PRICE

NUMBER OF
OPTIONS

WEIGHTED
AVERAGE EXERCISE
PRICE

Outstanding at the beginning of the year

56,925,000

$0.1206

59,745,000

Issued

Exercised

Expired

Outstanding at year-end

Exercisable at year-end

6,578,699

$0.0200

(9,425,000)

54,078,699

45,328,699

$0.1581

(2,820,000)

($0.2505)

$0.1018

56,925,000

$0.1022

36,825,000

$0.1206

$0.1117

$0.1940

$0.1132

The weighted average remaining contractual life of options outstanding at year end is 2.94 years (2016: 2.52 years). The
weighted average exercise price of outstanding shares at the end of the reporting period is $0.1018 (2016: $0.1206).

During the financial year, 9,425,000 options over ordinary shares expired and resulted in $205,511 being reclassified from
options reserve to accumulated losses.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 19. SHARE-BASED PAYMENTS (CONT)

d. Fair value of options grants during the period

The Company granted WH Ireland Limited on 12 September 2016 6,578,699 3-year warrants at an exercise price of 2 cents
per warrants. The share price on the date of the grant was 2.5 cents per share with a volatility of 84% and risk-free rate of 2%.

NOTE 20. KEY MANAGEMENT PERSONNEL COMPENSATION

a. Key management personnel (“KMP”)

The names are positions of KMP are as follows:

Executive Chairman and Managing Director

PD Reeve
Dr R Beeson Non-executive director
Non-executive director
BF Fraser
Non-executive director
JC Perkins
Company Secretary
JM Madden

b. KMP compensation

The totals of remuneration paid to KMP during the year are as follows:

Short-term employee benefits

Post-employment benefits

Share-based payments in equity

Share-based payments in options

Other long-term benefits

Termination benefits

Payments to contractors for accounting and secretarial services

Total

2017
$

444,562

36,838

100,000

69,552

2016
$

445,200

36,200

100,000

158,645

120,417

771,369

92,448

832,493

Refer to the Remuneration Report contained in the Director’s Report for details of the remuneration paid to each member of
the Group’s KMP for the year ended 30 June 2017.

NOTE 21. RELATED PARTY TRANSACTIONS
Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to
other parties unless otherwise stated.

Other transactions with key management personnel are set out in the Remuneration Report, there are no other related party
transactions.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 22. COMMITMENTS

a. Exploration expenditure commitments:

Exploration tenement minimum expenditure requirements

886,945

335,996

2017
$

2016
$

Payable:

not later than 12 months

between 12 months and 5 years

greater than 5 years

The Group does not have any expenditure commitments under the terms and conditions of the
tenements it holds. The exploration expenditure commitments relate to annual renewal fees,

b. Operating lease commitments:

Operating leases contracted for or committed to but not capitalised in the financial statements

Payable:

not later than 12 months

between 12 months and 5 years

greater than 5 years

NOTE 23. OPERATING SEGMENTS

Identification of reportable segments

412,149

395,588

79,208

886,945

296,416

39,578

335,994

50,058

33,949

53,460

87,740

84,007

141,200

The Group operates predominantly in the mining industry. This comprises exploration and evaluation of uranium projects.
Inter- segment transactions are priced at cost to the Consolidated Group.

The Group has identified its operating segments based on the internal reports that are provided to the Board of Directors on
a monthly basis. Management has identified the operating segments based on the two principal locations of its projects –
Sweden and Mauritania. The Group also maintains a corporate function primarily responsible for overall management of the
operating segments, raising capital and distributing funds to operating segments.

Corporate expenses include administration and regulatory expenses arising from operating an ASX listed entity.

Segment assets include the costs to acquire tenements and the capitalised exploration costs of those tenements Financial
assets including cash and cash equivalents, and investments in financial assets, are reported in the Treasury segment.

b. Basis of accounting for purposes of reporting by operating segments

i. Accounting policies adopted

Unless stated otherwise, all amounts reported to the board of directors, being the chief decision maker with respect to
operating segments, are determined in accordance with accounting policies that are consistent to those adopted in the
annual financial statements of the Group.

ii.

Inter-segment transactions

An internally determined transfer price is set for all inter-segment sales. This price is reset quarterly and is based on what
would be realised in the event the sale was made to an external party at arm’s length. All such transactions are eliminated
on consolidation of the Group’s financial statements.

Corporate charges are allocated to reporting segments based on the segments’ overall proportion of revenue generation
within the Group. The board of directors believes this is representative of likely consumption of head office expenditure
that should be used in assessing segment performance and cost recoveries.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 23. OPERATING SEGMENTS (CONT)

Inter-segment loans payable and receivable are initially recognised at the consideration received/to be received net of
transaction costs. If inter-segment loans receivable and payable are not on commercial terms, these are not adjusted to
fair value based on market interest rates. This policy represents a departure from that applied to the statutory financial
statements.

iii. Segment assets

Where an asset is used across multiple segments, the asset is allocated to that segment that receives majority economic
value from that asset. In the majority of instances, segment assets are clearly identifiable on the basis of their nature and
physical location.

iv. Segment liabilities

Liabilities are allocated to segments where there is a direct nexus between the incurrence of the liability and the
operations of the segment. Borrowings and tax liabilities are generally considered to relate to the Group as a whole and
are not allocated. Segment liabilities include trade and other payables and certain direct borrowings.

v. Unallocated items

The following items of revenue, expenses, assets and liabilities are not allocated to operating segments as they are not
considered part of the core operations of any segment:

• Non-exploration impairment of assets and other non-recurring items of revenue or expense

•

Income tax expense

• Deferred tax assets and liabilities

• Current tax liabilities

• Other financial liabilities

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 23. OPERATING SEGMENTS (CONT)

FOR THE YEAR TO 30 JUNE 2017

Segment revenue

Segment results

Amounts not included in segment results but reviewed by Board:

Expenses not directly allocable to identifiable segments or areas of interest

MAURITANIA
EXPLORATION
$

SWEDEN
EXPLORATION
$

CORPORATE
$

4,905

TOTAL
$

4,905

(495,433)

(894,800)

103

(1,390,130)

Accounting and audit fees

Computers and communications

Depreciation

Employee benefits expense

Exchange fluctuation

Insurance

Consulting fees and corporate advisory

Public relations

Rent and utilities

Share-based payment expenses

Share registry and listing fees

Travel and accommodation

AIM listing costs

Other expenses

Tax rebate for research and development

Loss after income tax

AS AT 30 JUNE 2017

Segment assets

Unallocated assets:

Trade and other receivables

Plant and equipment

Other non-current assets

Total assets

Segment asset increases for the period:

Capital expenditure-exploration

Less: Write-off of exploration assets

Segment liabilities

Unallocated liabilities:

Trade and other payables

Short-term provisions

Financial liabilities

Total liabilities

(161,277)

(35,034)

(6,319)

(736,614)

(173,997)

(32,981)

(31,238)

(100,650)

(66,178)

(69,552)

(119,455)

(70,290)

(640,963)

(55,921)

(3,690,599)

9,383,768

5,685,455

2,490,644

17,559,867

61,697

18,905

17,640,469

2,030,513

206,431

2,236,944

(495,433)

(897,367)

(4,802)

(1,397,602)

1,535,080

(690,936)

(4,802)

839,342

225,765

24,608

250,373

326,232

118,948

47,803

743,356

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 23. OPERATING SEGMENTS (CONT)

FOR THE YEAR TO 30 JUNE 2016

Segment revenue

Segment results

Amounts not included in segment results but reviewed by Board:

Expenses not directly allocable to identifiable segments or areas of interest

MAURITANIA
EXPLORATION
$

SWEDEN
EXPLORATION
$

(51,461)

CORPORATE
$

4,907

TOTAL
$

4,907

(46,554)

Accounting and audit fees

Computers and communications

Depreciation

Employee benefits expense

Finance costs

Insurance

Consulting fees and corporate advisory

Public relations

Rent and utilities

Share-based payment expenses

Share registry and listing fees

Travel and accommodation

AIM Listing costs

Other expenses

Tax rebate for research and development

Loss after income tax

AS AT 30 JUNE 2016

Segment assets

Unallocated assets:

Trade and other receivables

Plant and equipment

Other non-current assets

Total assets

Segment asset increases for the period:

Capital expenditure-exploration

Less: Write-off of exploration assets

Segment liabilities

Unallocated Liabilities:

Trade and other payables

Short term provisions

Financial liabilities

Total liabilities

(149,416)

(44,193)

(1,602)

(711,929)

(8,171)

(51,378)

(223,149)

(22,472)

(39,847)

(158,645)

(79,385)

(49,273)

(165,840)

(22,529)

148,606

(1,625,775)

7,647,926

6,484,992

366,185

14,459,093

57,708

14,556,801

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704,014

173,898

704,014

173,898

30,474

877,912

30,474

520,370

165,251

716,095

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 24. FINANCIAL RISK MANAGEMENT

a. Financial risk management policies

This note presents information about the Group’s exposure to each of the above risks, its objectives, policies and procedures
for measuring and managing risk, and the management of capital.

The Group’s financial instruments consist mainly of deposits with banks, short-term investments, and accounts payable and
receivable.

The Group does not speculate in the trading of derivative instruments. A summary of the Group’s financial assets and liabilities
is shown below:

FLOATING
INTEREST
RATE
$

FIXED
INTEREST
RATE
$

NON-
INTEREST
BEARING
$

2017
TOTAL
$

FLOATING
INTEREST
RATE
$

FIXED
INTEREST
RATE
$

NON-
INTEREST
BEARING
$

2016
TOTAL
$

Financial assets

Cash and cash equivalents

2,652,960

Trade and other receivables

Financial assets

Total financial assets

2,652,960

Financial liabilities

Financial liabilities at
amortised cost

Trade and other payables

Financial liabilities

Total financial liabilities

Net financial assets

2,652,960

b. Specific financial risk exposures and management

- 2,652,960

317,758

62,854

53,930

116,784 2,769,744

317,758

576,605

47,803

624,408

(507,624) 2,145,336

317,758

57,708

43,625

101,333

419,091

550,844

(449,511)

(131,753)

The main risk the Group is exposed to through its financial instruments are credit risk, liquidity risk and market risk consisting
of interest rate, foreign currency risk and equity price risk.

The board of directors has overall responsibility for the establishment and oversight of the risk management framework. The
board of directors has adopted practices designed to identify significant areas of business risk and to effectively manage those
risks in accordance with the risk profile. This includes assessing, monitoring and managing risks for the Group and setting
appropriate risk limits and controls. The Group is not of a size nor is its affairs of such complexity to justify the establishment
of a formal system for risk management and associated controls. Instead, the Board approves all expenditure, is intimately
acquainted with all operations and discuss all relevant issues at the Board meetings. The operational and other compliance
risk management have also been assessed and found to be operating efficiently and effectively.

i. Credit risk

Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract
obligations that could lead to a financial loss to the Group

The Group does not have any material credit risk exposure to any single receivable or Group of receivables under financial
instruments entered into by the Group.

Credit risk exposures
The maximum exposure to credit risk is that to its alliance partners and that is limited to the carrying amount, net of any
provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial
statements.

Credit risk related to balances with banks and other financial institutions is managed by the Group in accordance with
approved Board policy. Such policy requires that surplus funds are only invested with financial institutions residing in
Australia, where ever possible.

Impairment losses
Group’s financial assets that are past due total $nil (2016: $nil).

There has been no allowance for impairment in respect of the financial assets of the Group during this year.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 24. FINANCIAL RISK MANAGEMENT (CONT)

ii. Liquidity risk

Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise
meeting its obligations related to financial liabilities.

The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and ensuring sufficient cash
and marketable securities are available to meet the current and future commitments of the Group. Due to the nature
of the Group’s activities, being mineral exploration, the Group does not have ready access to credit facilities, with the
primary source of funding being equity raisings. The board of directors constantly monitor the state of equity markets in
conjunction with the Group’s current and future funding requirements, with a view to initiating appropriate capital raisings
as required. Any surplus funds are invested with major financial institutions.

The financial liabilities of the Group are confined to trade and other payables as disclosed in the statement of financial
position. All trade and other payables are non-interest bearing and due within 30 days of the reporting date.

iii. Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will
affect the Group’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.

The Board meets on a regular basis and considers the Group’s exposure currency and interest rate risk.

(1) Interest rate risk

Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the end of the reporting
period whereby a future change in interest rates will affect future cash flows or the fair value of fixed rate financial
instruments. The Group is also exposed to earnings volatility on floating rate instruments.

Interest rate risk is not material to the Group as no debt arrangements have been entered into, and movement in
interest rates on the Group’s financial assets is not material.

(2) Foreign exchange risk

Exposure to foreign exchange risk may result in the fair value or future cash flows of a financial instrument fluctuating
due to movement in foreign exchange rates of currencies in which the Group holds financial instruments which are
other than the Australian dollars functional currency of the Group.

With instruments being held by overseas operations, fluctuations in foreign currencies may impact on the Group’s
financial results. The Group’s exposure to foreign exchange risk is minimal; however the Board continues to review this
exposure regularly.

(3) Price risk

Price risk relates to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market prices.

The Group is exposed to securities price risk on investments held for trading or for medium to longer terms.

The investment in listed equities has been valued at the market price prevailing at balance date. Management of this
investment’s price risk is by ongoing monitoring of the value with respect to any impairment.

At balance date, the Group does not hold financial instruments that would give rise to price risk.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 24. FINANCIAL RISK MANAGEMENT (CONT)

iv. Sensitivity analyses

(1) Interest rates

The following table illustrates sensitivities to the Group’s exposures to changes in interest rates. The table indicates
the impact on how profit and equity values reported at balance sheet date would have been affected by changes in
the relevant risk variable that management considers to be reasonably possible. These sensitivities assume that the
movement in a particular variable is independent of other variables.

A change of 100 basis points in the interest rates at the reporting date would have increased/(decreased) equity and
profit or loss by the amounts shown below. The analysis was performed on a change of 100 basis points for 2017.

Year ended 30 June 2017

± 100 basis points change in interest rates

Year ended 30 June 2016

± 100 basis points change in interest rates

(2) Foreign exchange

PROFIT
$

EQUITY
$

±26,250

±6,516

±9,929

The Group has exposure to foreign currency risk to Swedish Krona (SEK) for assets the Group holds through its
Swedish subsidiary, Aura Energy Sweden AB. The following table illustrates sensitivities to the Group’s exposures to
changes in the SEK rate. The table indicates the impact on how profit and equity values reported at balance sheet
date would have been affected by changes in the relevant risk variable that management considers to be reasonably
possible. These sensitivities assume that the movement in a particular variable is independent of other variables.

Year ended 30 June 2017

± 10% of Australian dollar strengthening/weakening against the SEK

Year ended 30 June 2016

± 10% of Australian dollar strengthening/weakening against the SEK

PROFIT
$

EQUITY
$

+23,681

-46,199

+65,849

-59,118

Nil

The Group has exposure to foreign currency risk in relation to US dollars for assets the Group holds in Mauritania.
The following table illustrates sensitivities to the Group’s exposures to changes in the AUD/USD exchange rate. The
table indicates the impact on how profit and equity values reported at balance sheet date would have been affected
by changes in the relevant risk variable that management considers to be reasonably possible. These sensitivities
assume that the movement in a particular variable is independent of other variables.

Year ended 30 June 2017

± 10% of Australian dollar strengthening/weakening against the US dollar

Year ended 30 June 2016

± 10% of Australian dollar strengthening/weakening against the US dollar

PROFIT
$

EQUITY
$

+93,568

-78,084

+27,300

-59,745

Nil

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 24. FINANCIAL RISK MANAGEMENT (CONT)

v. Net fair values

(1) Fair value estimation

The fair values of financial assets and financial liabilities are presented in the table below and can be compared to
their carrying values as presented in the statement of financial position. Fair values are those amounts at which an
asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length transaction.

Cash and cash equivalents, trade and other receivables, and trade and other payables are short-term investments in
nature whose carrying value is equivalent to fair value.

The methods and assumptions used in determining the fair values of financial instruments are disclosed in the
accounting policy notes specific to the asset or liability.

vi. Financial liability and asset maturity analysis

Financial liabilities due for payment

Trade and other payables

Financial Liabilities

Total contractual outflows

Financial assets

Cash and cash equivalents

Trade and other receivables

Financial assets

Total anticipated inflows

WITHIN 1 YEAR

2017
$

2016
$

TOTAL

2017
$

2016
$

576,605

550,844

576,605

550,844

47,803

624,408

550,844

624,408

550,844

2,652,960

317,758

2,652,960

317,758

62,854

53,930

57,708

43,625

62,854

80,897

57,708

43,625

2,769,744

419,091

2,796,711

419,091

Net (outflow)/inflow on financial instruments

2,145,336

(131,753)

2,172,303

(131,753)

NOTE 25. EVENTS SUBSEQUENT TO REPORTING DATE
Since balance date, the Company has informed the market that it has made a critical metallurgical breakthrough which has
resulted in the reduction of Tiris project cash costs from US$30 / lb U308 to US$19.40 / lb U308.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 26. PARENT ENTITY DISCLOSURES

a. Financial position of Aura Energy Limited

Current assets

Cash and cash equivalents

Trade and other receivables

Financial assets

Total current assets

Non-current assets

Plant and equipment

Financial assets

Other assets

Total non-current assets

Total assets

Current liabilities

Trade and other payables

Short-term provisions

Financial liabilities

Total current liabilities

Total liabilities

Net assets

Equity

Issued capital

Option reserve

Accumulated losses

Total equity

b. Financial assets

Loans to subsidiaries

Shares in controlled entities at cost

Net carrying value

NOTE

2017
$

2016
$

2,490,644

299,974

7,763

80,897

24,227

43,625

2,579,304

367,826

18,905

26b

5,996,451

8,317,554

9,021,201

5,871,421

15,036,557

14,188,975

17,615,861

14,556,801

551,997

118,948

47,803

718,748

520,370

165,264

685,634

16,897,113

13,871,167

39,558,943

32,784,203

522,221

599,802

(23,184,051)

(19,512,838)

16,897,113

13,871,167

26b.i

5,729,189

6,410,654

267,262

1,906,900

5,996,451

8,317,554

i. Loans are provided by the parent entity to its controlled entities to fund their activities. The eventual recovery of loans and investments will be

dependent upon the successful commercial application of these projects or their sale to third parties.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17NOTE 26. PARENT ENTITY DISCLOSURES (CONT)

c. Financial performance of Aura Energy Limited

Loss for the year

Other comprehensive income

Total comprehensive income

2017
$

2016
$

(3,510,081)

(1,433,556)

(45,374)

(3,555,455)

(1,433,556)

d. Guarantees entered into by Aura Energy Limited for the debts of its subsidiaries

There are no guarantees entered into by Aura Energy Limited for the debts of its subsidiaries as at 30 June 2017 (2016: none).

e. Contingent liabilities of Aura Energy Limited

There are no contingent liabilities as at 30 June 2017, other than as detailed in Note 27 Contingent liabilities (2016: none).

f. Commitments by Aura Energy Limited

Exploration expenditure commitments:

Exploration tenement minimum expenditure requirements

886,945

335,996

2017
$

2016
$

Payable:

not later than 12 months

between 12 months and 5 years

greater than 5 years

The Group has no contracted exploration expenditure, however the Group has treatment core
asset tenement renewals as expenditure the Group is committed to.

Operating lease commitments:

Operating leases contracted for or committed to but not capitalised in the financial statements

Payable:

not later than 12 months

between 12 months and 5 years

greater than 5 years

412,149

395,588

79,208

886,945

296,418

39,578

335,996

50,058

33,949

53,460

87,740

84,007

141,200

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The Group shares premises with a number of companies. Balances stated represent the maximum gross amount payable, prior
to reimbursement from other parties.

The amounts presented above are applicable for both Aura Energy Limited (the parent) and the Consolidated Group.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17
NOTE 27. CONTINGENT LIABILITIES
On 15 October 2010, the Company and Global Coal Management plc entered into a Share Sale and Purchase Agreement which
resulted in the Company acquiring all the shares on issue in GCM Africa Uranium, the entity which held the beneficial interest of
GCM in the above- mentioned research permits in Mauritania.

The Company paid GCM US$100,000 on execution of the Share Sale and Purchase Agreement; US$472,183 in cash plus 2,000,000
fully paid ordinary shares in the Company on completion (due diligence); and, US$500,000 on the first anniversary of completion.

The Company also agreed to pay a contingent consideration:

• US$2,000,000 (in cash and shares as determine by the Company) on the delineation of 75 million pounds or more Initial

Resource (not defined in the Letter Agreement) under the Australasian Code for the Reporting of Exploration Results, Mineral
Resources and Ore Reserves; and

• US$400,000 in cash and 400,000 fully paid ordinary shares in the Company for each Subsequent Resource
of 6,500,000 pounds up to a maximum of US$4,000,000 in cash and 4,000,000 in fully paid ordinary shares.

The obligations to make the contingent consideration payments are held by the Company and the contingent consideration is
only payable if the Initial Resource and Subsequent Resource are achieved within 10 years of the date of the Share Sale and
Purchase Agreement. Accordingly, the obligation to pay the contingent consideration expires on
15 October 2020.

There are no other contingent liabilities as at 30 June 2017.

NOTE 28. COMPANY DETAILS
The registered office and principal place of the Company is:

Address: Level 1, 34-36 Punt Road, Windsor Victoria 3181
Telephone: +61 (0)3 9516 6500
Facsimile: +61 (0)3 9516 6565
Website: www.auraenergy.com.au
E-mail:

info@auraenergy.com.au

AURA ENERGY LIMITED ANNUAL REPORT 2016/17DIRECTORS’ DECLARATION

The directors of the Company declare that:

1. The financial statements and notes to the accounts are in accordance with the Corporations Act 2001 (Cth) and:

(a) Comply with Accounting Standards.

(b) Are in accordance with International Financial Reporting Standards issued by the International Accounting Standards

Board, as stated in Note 1 to the financial statements.

(c) Give a true and fair view of the financial position as at 30 June 2017 and of the performance for the year ended on that

date of the Company and Consolidated Group.

2. The Chief Executive Officer and Chief Finance Officer have each declared that:

(a) The financial records of the Company for the financial year have been properly maintained in accordance with

s.286 of the Corporations Act 2001 (Cth).

(b) The financial statements and notes for the financial year comply with the Accounting Standards.

In the directors’ opinion there are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors pursuant to s.295(5) and is signed for and on
behalf of the directors by:

Peter Reeve

Chairman

Dated this Friday, 29 September 2017

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17

INDEPENDENT AUDITOR’S REPORT

Independent Auditor's Report

To the Members of Aura Energy Limited

Report on the Audit of the Financial Report

Opinion

We have audited the financial report of Aura Energy Limited (“the Company”) and its
subsidiaries (“the Consolidated Entity”), which comprises the consolidated statement of
financial position as at 30 June 2017, the consolidated statement of profit or loss and

other comprehensive income, the consolidated statement of changes in equity and the
consolidated statement of cash flows for the year then ended, and notes to the financial
statements, including a summary of significant accounting policies, and the directors’
declaration.

In our opinion:

the accompanying financial report of the Consolidated Entity is in accordance with
the Corporations Act 2001, including:

(i)

(ii)

giving a true and fair view of the Consolidated Entity’s financial position as
at 30 June 2017 and of its financial performance for the year then ended;

and

complying with Australian Accounting Standards and the Corporations
Regulations 2001.

the financial report also complies with International Financial Reporting Standards
as disclosed in Note 1(a)(i).

Basis for Opinion

We conducted our audit in accordance with Australian Auditing Standards. Those
standards require that we comply with relevant ethical requirements relating to audit
engagements and plan and perform the audit to obtain reasonable assurance about

whether the financial report is free from material misstatement. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report. We are independent of the Consolidated Entity in
accordance with the auditor independence requirements of the Corporations Act 2001

and the ethical requirements of the Accounting Professional and Ethical Standards
Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are

relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.

We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17Independent Auditor’s Report
To the Members of Aura Energy Limited (Continued)

Material Uncertainty Related to Going Concern

We draw attention to Note 1(a)(iii) in the financial report, which indicates that the Consolidated Entity incurred a
net loss of $3,690,599 during the year ended 30 June 2017. As stated in Note 1(a)(iii), these events or
conditions, along with other matters as set forth in Note 1(a)(iii), indicate that a material uncertainty exists that
may cast significant doubt on the Consolidated Entity’s ability to continue as a going concern. Our opinion is
not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial report of the current period. These matters were addressed in the context of our audit of the
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.

Key audit matter

How our audit addressed the key audit matter

Exploration and Evaluation Expenditure –
$14,851,820

(Refer to Note 11)

Exploration and evaluation is a key audit matter due
to:

The significance of the balance to the

Consolidated Entity’s consolidated financial
position.

The level of judgement required in evaluating

management’s application of the requirements of
AASB 6 Exploration for and Evaluation of
Mineral Resources (“AASB 6”). AASB 6 is an

industry specific accounting standard requiring
the application of significant judgements,
estimates and industry knowledge. This includes
specific requirements for expenditure to be
capitalised as an asset and subsequent
requirements which must be complied with for
capitalised expenditure to continue to be carried
as an asset.

The assessment of impairment of exploration
and evaluation expenditure being inherently
difficult.

Our procedures included, amongst others:

Assessing management’s determination of its

areas of interest for consistency with the
definition in AASB 6. This involved analysing the
tenements in which the consolidated entity holds
an interest and the exploration programmes
planned for those tenements.

For a sample of tenements, we assessed the

Consolidated Entity’s rights to tenure by
corroborating to external supporting
documentation;

We tested the additions to capitalised

expenditure for the year by evaluating a sample
of recorded expenditure for consistency to

underlying records, the capitalisation
requirements of the Consolidated Entity’s
accounting policy and the requirements of AASB
6;

We considered the activities in each area of

interest to date and assessed the planned future
activities for each area of interest by evaluating
budgets for each area of interest;

We assessed each area of interest for one or

more of the following circumstances that may
indicate impairment of the capitalised
expenditure:

the licenses for the right to explore expiring in

the near future or are not expected to be
renewed;

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17

Independent Auditor’s Report
To the Members of Aura Energy Limited (Continued)

Key audit matter

How our audit addressed the key audit matter

substantive expenditure for further
exploration in the specific area is neither
budgeted or planned;

decision or intent by the Consolidated Entity
to discontinue activities in the specific area of

interest due to lack of commercially viable
quantities of resources; and

data indicating that, although a development
in the specific area is likely to proceed, the
carrying amount of the exploration asset is
unlikely to be recovered in full from
successful development or sale.

We assessed the appropriateness of the related

disclosures in note 11 to the financial
statements.

Other Information

The directors are responsible for the other information. The other information comprises the information
included in the Consolidated Entity’s annual report for the year ended 30 June 2017, but does not include the
financial report and our auditor’s report thereon.

Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.

In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our

knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the Financial Report

The directors of the Company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such

internal control as the directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error. In Note 1(a)(i),
the directors also state in accordance with Australian Accounting Standard AASB 101 Presentation of Financial

Statements, that the financial report complies with International Financial Reporting Standards.

In preparing the financial report, the directors are responsible for assessing the Consolidated Entity’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Consolidated Entity or to cease
operations, or has no realistic alternative but to do so.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17Independent Auditor’s Report
To the Members of Aura Energy Limited (Continued)

Auditor’s Responsibilities for the Audit of the Financial Report

Our responsibility is to express an opinion on the financial report based on our audit. Our objectives are to
obtain reasonable assurance about whether the financial report as a whole is free from material misstatement,
whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian
Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from

fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of this financial report.

As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement
and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial report, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve

collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Consolidated Entity’s internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.

Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Consolidated Entity’s ability to continue as a going

concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Consolidated Entity to cease to
continue as a going concern.

Evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that
achieves fair presentation.

Obtain sufficient appropriate audit evidence regarding the financial information of the entities or

business activities within the Consolidated Entity to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Consolidated Entity audit. We remain
solely responsible for our audit opinion.

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17

Independent Auditor’s Report
To the Members of Aura Energy Limited (Continued)

We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or

when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.

Report on the Remuneration Report

We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2017.
The directors of the Company are responsible for the preparation and presentation of the remuneration report
in accordance with s 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the

remuneration report, based on our audit conducted in accordance with Australian Auditing Standards.

Auditor’s Opinion

In our opinion, the Remuneration Report of the Company, for the year ended 30 June 2017, complies with
section 300A of the Corporations Act 2001.

BENTLEYS
Chartered Accountants

DOUG BELL CA
Director

Dated at Perth this 29th day of September 2017

AURA ENERGY LIMITED ANNUAL REPORT 2016/17

ADDITIONAL INFORMATION

AS OF 22 SEPTEMBER 2017

The following additional information is required by the Australian Securities Exchange in respect of listed public companies.

a. Distribution of Shareholders

1 - 1,000

1,001 - 5,000

5,001 - 10,000

10,001 - 100,000

100,001 - 1,000,000,000

TOTAL

b. Unmarketable Parcels

Minimum $ 500.00 parcel at $ 0.0250 per unit

TOTAL HOLDERS

UNITS % OF ISSUED CAPITAL

647

445

3,888

90,830

236,506

27,956,960

764,519,940

1,226

792,808,124

0.00

0.01

0.03

3.53

96.43

100.00

MINIMUM
PARCEL SIZE

20,000

HOLDERS

UNITS

258

2,212,370

c. Voting Rights

The voting rights attached to each class of equity security are as follows:

• Ordinary shares: Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a

meeting or by proxy has one vote on a show of hands.

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17

d. 20 Largest Shareholders — Ordinary Shares as at 22 September 2017

RANK

NAME

UNITS

% OF UNITS

COMPUTERSHARE CLEARING PTY LTD

HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED

CITICORP NOMINEES PTY LIMITED

PRE-EMPTIVE TRADING PTY LTD

SAMBOLD PTY LTD

BNP PARIBAS NOMINEES PTY LTD

PASAGEAN PTY LIMITED

MR MARTY HENG LAU

MR PETER DESMOND REEVE

10 MR PIETER HOEKSTRA + MRS RUTH HOEKSTRA

HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED-GSCO ECA

YARANDI INVESTMENTS PTY LTD

13 MS MICHELLE ANNE PAINE

BUSHELL NOMINEES PTY LTD

15 MRS KERRYN PATRICIA DELEN

16 MR LUKE PETER DALE + MRS MARIEANNE ERIKA DALE

17 MR SEBASTIAN MADEJA + MRS SYLVIA MADEJA

18 MR SCOTT ANDREW ROBERTS

19 M & K KORKIDAS PTY LTD

20 MS CHUI YING CHAN

Totals: Top 20 holders of Ordinary Fully Paid Shares

Total Remaining Holders Balance

242,837,266

98,099,286

63,576,281

37,500,000

15,364,895

14,796,330

13,094,558

10,500,000

9,718,304

5,300,000

5,250,000

4,754,793

4,700,000

4,292,542

3,668,075

3,611,468

3,500,000

3,400,000

3,327,828

30.59

12.36

8.01

4.72

1.94

1.86

1.65

1.32

1.22

0.67

0.66

0.60

0.59

0.54

0.46

0.45

0.44

0.43

0.42

550,791,626

242,944,264

69.39

30.61

COMPANY SECRETARY
The name of the Company Secretary is JM Madden.

UNQUOTED SECURITIES
Options over Unissued Shares

PRINCIPAL REGISTERED OFFICE
As disclosed in Note 28 Company Details of this Annual Report.

A total of 89,553,189 (2016: 170,123,536) unlisted options are
on issue of which 35,000,000 (2016: 35,000,000) options are
issued to directors as at 22 September 2017.

USE OF FUNDS
The Company has used its funds in accordance with its initial
business objectives.

REGISTERS OF SECURITIES ARE HELD AT THE
FOLLOWING ADDRESSES
As disclosed in the Corporate Directory of this Annual Report.

STOCK EXCHANGE LISTING
Quotation has been granted for all the ordinary shares of
the Company on all Member Exchanges of the Australian
Securities Exchange Limited, as disclosed in the Corporate
Directory of this Annual Report.

AURA ENERGY LIMITED ANNUAL REPORT 2016/17TENEMENT REPORT

COUNTRY

Mauritania

TENEMENT
NUMBER

NAME

DATE OF
GRANT/
APPLICATION

EXPIRY DATE

SQ KMS HOLDER

561

563

564

1482

2002

2365

2366

2457

2458

Oum Ferkik

16-Apr-08

20-Nov-17

60 Aura Energy Limited

Oued El Foule Est

16-Apr-08

24-Mar-18

313 Aura Energy Limited

Ain Sder

16-Apr-08

09-Jun-18

330 Aura Energy Limited

Oum Ferkik Sud

17-Jan-17

17-Jan-20

476 Aura Energy Limited

Aguelet

17-Jan-17

17-Jan-20

100 Aura Energy Limited

Oued El Foule Sud

20-May-15 (Application)

224 Aura Energy Limited

Agouyame

20-May-15 (Application)

34 Aura Energy Limited

Hadeibet Bella

1-Mar-16

(Application)

Touerig Taet

1-Mar-16

(Application)

41 TIMCO

134 TIMCO

Sweden

2007:243

Haggan nr 1

28-Aug-07 28-Aug-22

18.3 Aura Energy Sweden AB

2009:23

Koborgsmyren nr 1

23-Jan-09

23-Jan-19

5.4 Aura Energy Sweden AB

2017:7

2017:9

Skallbole nr 1

20-Jan-16

20-Jan-19

7.8 Aura Energy Sweden AB

Mockelasen nr 1

21-Jan-16

21-Jan-19

17.6 Aura Energy Sweden AB

EQUITY
INTEREST

100%

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AURA ENERGY LIMITED ANNUAL REPORT 2016/17

THis PAgE HAs bEEN LEFT bLANK iNTENTiONALLY

AURA ENERGY LIMITED ANNUAL REPORT 2016/17ACN: 115 927 681