AURIS MINERALS LIMITED
ANNUAL REPORT
30 JUNE 2018
ABN 77 085 806 284
DIRECTORS
Neville Bassett
Brian Thomas
Craig Hall
Robert Martin
Non-Executive Chair
Non-Executive Director
Non-Executive Director
Non-Executive Director
CHIEF OPERATING OFFICER
Mike Hendriks
COMPANY SECRETARY
Mark Clements
AUSTRALIAN BUSINESS NUMBER
77 085 806 284
REGISTERED AND PRINCIPAL OFFICE
Level 1, 18 Richardson Street
West Perth, Western Australia 6005
PO Box 298
West Perth, Western Australia 6872
Telephone: (+61-8) 6109 4333
Email: general@aurisminerals.com.au
Website: www.aurisminerals.com.au
SHARE REGISTRY
Security Transfer Australia Pty Ltd
Alexandrea House
770 Canning Highway
Applecross, Western Australia 6153
Telephone (+61-8) 9315 2333
Facsimile: (+61-8) 9315 2233
Email: registrar@securitytransfer.com.au
Website: www.securitytransfer.com.au
AUDITORS
Greenwich & Co Audit Pty Ltd
Level 2, 35 Outram Street
West Perth, Western Australia 6005
SOLICITORS
Steinepreis Paganin
Level 4, The Read Buildings
16 Milligan Street
Perth, Western Australia 6000
AUSTRALIAN SECURITIES EXCHANGE
Level 40, Central Park
152-158 St Georges Terrace
Perth, Western Australia 6000
ASX CODES
Ordinary Shares: AUR
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CONTENTS
Chair’s Letter
Directors’ Report
Schedule of Mining Tenements
Corporate Governance Statement
Additional Shareholder Information
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cashflows
Notes to the Consolidated Financial Reports
Directors’ Declaration
Independent Auditor’s Review Report
3
4
30
32
41
43
44
45
46
47
48
74
75
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CHAIR’S LETTER
Dear Shareholder,
I am pleased to be presenting to you in my inaugural year as Chair, the Auris Minerals Annual Report for the
financial year ended 30 June 2018 (“FY 2018”).
The 12 months in focus marked another chapter in the evolution of Auris, and was bookended by the realignment
of the Company’s corporate and operational objectives which culminated in the restructuring of our Board and
management team.
As I am sure our shareholders will be aware, following a General Meeting held on Friday 20th April 2018, I was
appointed to the Board as a Non-Executive Director along with Mr Brian Thomas and later appointed as Non-
Executive Chairman. On 1 August 2018, Mr Craig Hall was appointed as a Non-Executive Director to represent
the interests of Investmet Limited, replacing Ms Bronwyn Barnes.
Shortly after the conclusion of FY 2018, Mr Mike Hendriks was appointed on a strategic consultancy
arrangement to oversee the daily operations of the business. I am delighted with the initiatives and corporate
insight Mike has provided since joining our management team and I look forward to his ongoing contributions
towards driving Auris forward.
I acknowledge and understand that the Company’s recent history has been dotted by changes to management
and Board personnel, however with the swift implementation of this recent realignment, I am pleased to advise
that the foundations are now firmly set for Auris to deliver on our exploration objectives for our shareholders.
Shifting our focus away from the Boardroom, as you will note from recent ASX filings, a key focus over recent
months has been on refining the exploration strategy across our ~1,380km² copper-gold portfolio in the Bryah
Basin of Western Australia.
From a technical perspective, we continue to be encouraged by the positive results received from our ongoing
target generation activities, which have provided a very robust foundation from which our follow-up drilling
programs can be built.
Auris’ ‘on-ground’ focus for FY 2019:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
narrow our focus towards ramping up exploration across our Bryah Basin tenement holdings;
significantly improve our regional geological control of the Western Bryah Basin – starting with the near-
term release of detailed geological interpretations and updated project maps;
stronger commitment to systematically drilling our highest priority targets – starting with the respective
Cashman and Forrest Projects;
build upon our relationship with Sandfire Resources NL (ASX: SFR) as we look to progress exploration
work across the highly prospective Morck Well East and Doolgunna Projects; and
assess new strategic opportunities as they arise to expand our asset base.
I am very confident that our portfolio has considerable underlying potential, you only need to look at some of the
world-class mining operations that reside in the same neighbourhood as Auris, and so the challenge is now
firmly centred on delivering on this potential.
Finally, I would like to take this opportunity to thank all of our shareholders for their ongoing support over the
past 12 months. You can be assured that your Board is working hard to repay your commitment, having entered
this current financial year with great optimism.
Yours sincerely,
NEVILLE BASSETT
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DIRECTORS’ REPORT
The directors present their report together with the financial report of Auris Minerals Limited (the Company or
Auris), for the year ended 30 June 2018 and the auditor’s report thereon.
1.
Directors
The directors of the Company at any time during or since the end of the financial year are:
Name
Period of Directorship
Mr Neville Bassett – Non-Executive Chair
Appointed 20 April 2018
Mr Robert Martin – Non-Executive Director
Appointed 2 November 2016
Mr Brian Thomas – Non-Executive Director
Appointed 20 April 2018
Mr Craig Hall – Non-Executive Director
Appointed 1 August 2018
Ms Bronwyn Barnes – Non-Executive Director
Appointed 25 November 2016, held position of Non-
Executive Chair to 20 April 2018, Removed 1 August
2018
Dr Susan Vearncombe – Non-Executive Director Appointed 11 August 2017, Removed 20 April 2018
Mrs Debbie Fullarton – Executive Director
Appointed 1 September 2016, Resigned 11 August 2017
The qualifications, experience, interest in shares and options, and other directorships of the directors in office
at the date of this report and during the financial year are:
Current Directors
Neville Bassett
Non-Executive Chair
Experience and expertise
Mr Bassett is a Chartered Accountant specialising in corporate, financial
and management advisory services. He has been involved with numerous
public company listings and capital raisings. His involvement in the
corporate arena has also taken in mergers and acquisitions and includes
significant knowledge and exposure to the Australian financial markets. He
has a wealth of experience in matters pertaining to the Corporations Act,
ASX listing requirements, corporate taxation and finance. Mr Bassett is a
Fellow of Chartered Accountants Australia and New Zealand. He was a
Director/Councillor of the Royal Flying Doctor Service in Western Australia
for 26 years, serving 8 years as Chairman before his retirement in 2017. He
served 6 years as Western Operations representative on the National Board
of the Australian Council of the Royal Flying Doctor Service of Australia. Mr
Bassett was awarded a Member of the Order of Australia (AM) in the 2015
Australia Day Honours.
Interest in Shares and Options 1,100,000 ordinary shares in Auris Minerals Limited.
Listed company directorships
in last three years
Currently a Non-Executive Director of Pointerra Limited (ASX: 3DP) and
Metalsearch Ltd (ASX: MSE). Previously a Non-Executive Director of
Quantify Technology Holdings Ltd, Longford Resources Ltd, Meteoric
Resources NL and Vector Resources Ltd.
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DIRECTORS’ REPORT
Robert Martin
Non-Executive Director
Experience and expertise
Mr Martin is a major shareholder in the Company and has extensive
experience in ASX listed companies.
Mr Martin is also a director and the largest private shareholder (22.8%) of
Bulletin Resources Limited (ASX: BNR).
Mr Martin played a key role in the BNR joint venture with Pantoro (ASX:
PNR) to establish the highly successful Halls Creek gold mine.
Interest in Shares and Options 31,151,486 ordinary shares in Auris Minerals Limited and 2,000,000
Listed company directorships
in last three years
performance rights expiring 22 November 2020.
Non-Executive Director of Bulletin Resources Limited (ASX: BNR)
Brian Thomas
Non-Executive Director
Experience and expertise
Mr Thomas is the principal of a corporate advisory practice working with
small to mid-market capitalisation companies in corporate finance, mergers
& acquisitions and investor relations. He has held both Executive and Non-
Executive Director roles with numerous ASX listed and unlisted companies
after an extensive career in the financial services sector in corporate
stockbroking, investment banking, funds management and banking. He
has more than 30 years of mining and exploration industry experience in a
broad range of commodities from precious and base metals, bulk and
industrial minerals, diamonds plus oil and gas.
Mr Thomas graduated from the University of Adelaide with a BSc in
Geology and Mineral Economics, the University of Western Australia
Business School with an MBA and the Securities Institute of Australia (now
FinSIA) with a Certificate in Applied Finance and Investment.
Interest in Shares and Options None
Listed company directorships
in last three years
Mr Thomas is currently a Non-Executive Director of Cougar Metals NL
(ASX: CGM) and was formerly a Non-Executive Director of Tempo Australia
Ltd (ASX: TPP). He was a Non-Executive Director of Orinoco Gold Limited
before becoming the, now former, Non-Executive Chairman. He was also
previously the Non-Executive Chairman for GO Energy Group Limited and
Ensurance Ltd.
Craig Hall
Non-Executive Director
Experience and expertise
Mr Craig Hall is an experienced geologist with over 30 years of minerals
industry experience in exploration, development and production roles in a
range of commodities, principally precious and base metals. He has held
a variety of senior positions with mid-tier and junior sector resource
companies within Australia and overseas. He has previously consulted to
the minerals industry providing high quality exploration outcomes, on-site
mining support, expert reporting, project valuations and strategic advice to
companies
through an association with a well-respected Western
Australian resource consultancy. Until 6 August 2018, Mr Hall served as a
Non-Executive Director of Eclipse Metals Ltd (ASX: EPM) an Australian
exploration company focused on exploring the Northern Territory and
Queensland for uranium and manganese mineralisation.
Interest in Shares and Options None
Listed company directorships
in last three years
Mr Hall was a Non-Executive Director of Eclipse Metals Ltd.
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DIRECTORS’ REPORT
Former Directors
Bronwyn Barnes
Non-Executive Director – Removed 1 August 2018
Experience and expertise
Ms Barnes is a mining industry executive and consultant with over 23 years’
experience that includes, investor relations, stakeholder relations (including
Government relations), heritage and native title, corporate development
and strategic planning. Most recently she was Executive Chair of Windward
Resources Ltd where she oversaw the successful on market takeover of
Windward by Independence Group NL and before this spent 4 years as
deputy CEO of AMC Bauxite Ltd and 2 years as Managing Director of
Graynic Metals Pty Ltd. Ms Barnes has held positions both in the minerals
and energy sectors of the mining industry including, WMC, BHPB Nickel
West, Anaconda Nickel, Methanex Australia and Philips Petroleum
Australia.
Interest in Shares and Options 1,004,349 ordinary shares in Auris Minerals Limited.
Listed company directorships in
last three years
Ms Barnes is the Non-Executive Chair of Indiana Resources Limited (ASX:
IDA), MOD Resources Ltd (ASX: MOD) and was formerly the Executive
Chair of Windward Resources Ltd and Non-Executive Director of JC
International Ltd.
Susan Vearncombe
Non-Executive Director – Removed 20 April 2018
Experience and expertise
Dr Vearncombe is a geologist with over 25 years’ experience in the
exploration and mining sectors. Susan has a very strong technical
background that spans projects across Australasia, North and South
America, Asia, Africa and Europe. She also has a broad range of
boardroom and managerial experience that includes public listing, capital
raisings, project acquisitions and initiatives, geology audits, operational
practices for best outcomes and establishment of offshore subsidiaries.
Dr Vearncombe was a former MD of Silver Swan Group, Non-Executive
Director of Straits Resources and General Manager-Geology for Mercator
Gold. Currently, in conjunction with a Sydney-based Fund, Susan identifies
mining and exploration opportunities in the Iberian Peninsula, carries out
negotiations, due diligence, acquisition and placement into appropriate
vehicles.
Interest in Shares and Options None
Listed company directorships
in last three years
None
Debbie Fullarton
Executive Director – Resigned 11 August 2017
Experience and expertise
Mrs Fullarton is a Chartered Accountant with over 25 years' experience in
the resources industry. She served as the Company’s Chief Financial
Officer from 2012 until her resignation in August 2017. She has provided
corporate, financial management, administration and secretarial services
for a number of listed and unlisted companies with a specific focus on
exploration. Mrs Fullarton formerly held the position of Financial Manager
for De Beers Australia Exploration Limited and has also consulted to Gold
Road Resources Limited, Base Resources Limited and North Australian
Diamonds Limited. Mrs Fullarton currently holds director roles in a number
of unlisted companies and is a member of the Institute of Chartered
Accountants Australia and a member of the Governance Institute of
Australia.
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DIRECTORS’ REPORT
Interest in Shares and Options 1,950,833 ordinary shares in Auris Minerals Limited and options to acquire
a further 400,000 ordinary shares.
Listed company directorships
in last three years
None
2.
Company Secretary
Mr Mark Clements holds the position of Company Secretary, being appointed on 2 July 2012. Mr Clements
gained a Bachelor of Commerce degree from the University of Western Australia. He is a Fellow of the Institute
of Chartered Accountants and a member of the Australian Institute of Company Directors and an affiliated
member of the Institute of Chartered Secretaries in Australia. Mr Clements currently holds the position of
Company Secretary for a number of publically listed companies and has experience in corporate finance,
accounting and administration, capital raisings and ASX compliance and regulatory requirements.
3.
Directors’ Meetings
Formal meetings of the directors of the Company during the financial year are tabled as follows:
Director
Neville Bassett
Brian Thomas
Bronwyn Barnes
Susan Vearncombe
Robert Martin
Debbie Fullarton
Meetings eligible to attend
Meetings attended
2
2
6
4
6
-
2
2
4
4
6
-
4.
Principal Activities and Review of Operations
Review of Financial Condition
The Group recorded a loss of $1,317,036 for the year ended 30 June 2018 (2017: loss of $884,710). The loss
includes an impairment adjustment for exploration and evaluation expenditure of $364,813 (2017: $254,115).
As at 30 June 2018, the Group had net working capital of $3,971,818 (2017: $2,567,845). The Group’s net asset
position was $20,914,119 (2017: $17,651,481).
Exploration Highlights
Auris is primarily exploring for high-grade copper-gold deposits in the highly prospective Bryah Basin region of
Western Australia.
Significant activities during the 2018 financial year included the following:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
Phase 2 RC drilling at Wodger (1,251m);
Follow-up diamond drilling at Wodger (2 holes, 1,170m) and Forrest (1 hole, 580m) Prospects;
First sulphides intercepted at Wodger Prospect (in WDRC005);
DHEM surveys of three holes at Wodger and one hole at Forrest – new conductor defined from
WRDD003;
Reprocessed ground-based MLEM survey at Forrest – new conductor defined.
Gravity surveys completed on four tenements (three on Horseshoe Project and one on Forrest Project)
– completes gravity coverage of the entire tenement portfolio in the Bryah Basin;
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(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
Regional (1:100,000 scale) and detailed (1:25,000 scale) geological interpretations of all available
historical data, including magnetics, radiometrics, gravity, EM, geochemistry, published maps, etc.,
commissioned – 75% completed, with some significant outcomes (e.g.,. recognition of previously
unmapped prospective stratigraphy);
VTEM survey over areas of interest on the Cashman, Forrest and Horseshoe Project areas (total 1,802
line km) – multiple anomalies/targets defined, which require follow-up and/or drill testing;
Revised geological interpretation of the Wodger and Forrest Prospects – nearing completion, further
drilling planned;
Farm-out of the Doolgunna and Morck Well East tenements (4 in total) to Sandfire Resources NL;
VTEM survey over the Morck Well JV area – several robust anomalies defined;
Massive sulphide identified in 3 aircore holes at the far northeast of the Morck Well JV – followed up by
RC and diamond core holes, DHEM and ground-based MLEM;
Follow-up aircore drilling at Feather Cap Prospect, Morck Well West Project;
Regional soil sampling programme initiated over the prospective Karalundi Formation on Cashman
Project (nearing completion);
Establishment of a new Exploration Database, with Expedio data management consultants;
Compilation of a Technical Library of historical reports, with catalogue.
In addition to the above, a comprehensive review and assessment of the entire exploration portfolio has been
undertaken, the Projects have been ranked and prioritised, and a new exploration strategy has been developed.
Exploration Portfolio
Auris has consolidated a 1,380km² copper-gold exploration portfolio in the Bryah Basin divided into five well-
defined project areas – Forrest, Cashman, Horseshoe, Morck Well and Doolgunna. In February 2018, Auris
entered into a farm-in JV agreement with Sandfire Resources NL with respect to the Morck Well East and
Doolgunna Projects (which cover 442km²).
In addition, the Company owns three Mining Leases, one Exploration License and one Prospecting License in
the Chunderloo area, just over 15km southwest of Meekatharra.
The projects are currently ranked as follows:
1.
2.
3.
4.
5.
6.
Cashman
Forrest
Morck Well East
Doolgunna
Horseshoe Well
Chunderloo
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DIRECTORS’ REPORT
Figure 1: Auris Exploration Tenement Portfolio in the Bryah Basin (Sandfire, Northern Star & Omni JVs indicated)
Notes:
1.
2.
3.
4.
5.
The Forrest Project tenements (Figure 1) have the following outside interests:
(cid:1)
(cid:1)
Westgold Resources Ltd (ASX:WGX) own the gold rights over the Auris interest
Auris 80%; Fe Ltd 20% ((Fe Ltd (ASX:FEL) interest is free carried until a Decision to Mine)
Doolgunna Project tenement E52/2438 – Subject to Farm-in Agreement with Sandfire Resources NL (ASX:SFR) (Figure 1)
The Morck Well East JV Project tenements E52/1613, E51/1033, E52/1672 (Figures 1) (Auris 80%; Fe Ltd 20%)
(cid:1)
Subject to Farm-in Agreement with Sandfire Resources NL (ASX:SFR)
The Cashman Project tenements E51/1391, E51/1837-38, E52/2509 (Figure 1) have the following outside interests:
(cid:1)
Auris 51%; Northern Star 49% (ASX:NST) with Auris earning 70%
The Horseshoe Project tenements E52/3248, E52/3291, E52/2509 (Figure 1) have the following outside interests:
(cid:1)
Auris 85%; OMNI Projects Pty Ltd 15% (OMNI interest is free carried until a Decision to Mine)
Exploration Strategy
Auris’ exploration strategy is summarised as follows:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
Focus attention on unlocking the value of the current tenement package in the Bryah Basin;
Assess new strategic project opportunities as they arise;
Target multiple Cu-Au deposits – including but not limited to only VMS model deposits;
Develop the best regional geological control possible (to provide context), by means of published maps,
airborne geophysics (magnetics, radiometrics & EM), ground gravity and field mapping;
Commitment to drill exploration targets as soon as possible after definition;
Adhere to the highest technical standards in all activities.
Review of Operations
Drilling at Wodger and Forrest
The first phase of RC drilling was completed on the Wodger Prospect in July 2017 (total 999m), to test the
anomalous copper and gold intersected in previous aircore drilling. The following significant intercepts were
reported (ASX announcement, dated 21 August 2017), along a strike length of approximately 150m.
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(cid:1)
(cid:1)
(cid:1)
(cid:1)
WDRC002
14m @ 1.48% Cu, from 118m, including
5m @ 3.61% Cu, from 123m
9m @ 2.01g/t Au, from 123m, including
3m @ 5.19g/t Au;
WDRC003
61m @ 0.49% Cu, from 122m, including
5m @ 0.98% Cu from 128m
3m @ 1.07% Cu from 156m
4m @ 1.31% Cu from 171m
9m @ 0.94g/t Au, from 171m
WDRC004
27m @ 0.37% Cu, from 96m, including
1m @ 3.89% Cu, from 96m;
WDRC005
50m @ 1.55% Cu, from 175m, including
31m @ 2.39% Cu, from 187m, including
17m @ 3.41% Cu, from 200m
A second phase of RC drilling, in September 2017 (total 1,251m), yielded more encouraging results (ASX
announcement, dated 17 October 2017):
(cid:1)
(cid:1)
(cid:1)
(cid:1)
WDRC006
78m @ 0.35% Cu, including
15m @ 1.17% Cu, from 138m;
WDRC007
6m @ 1.14% Cu, from 235m;
WDRC008
28m @ 0.75% Cu, from 155m;
WDRC010
66m @ 0.59% Cu, from 290m, including
3m @ 2.20% Cu, from 307m
11m @ 1.22% Cu, from 317m
5m @ 2.38% Cu, from 346m
Two diamond core holes (WRDD003 & 004, for 560m & 610m, respectively) were drilled at Wodger in the
reporting period, to follow up the two drilled in the first half of 2017. The deepest hole was partly paid for with a
$200,000 Exploration Incentive government grant (ASX announcement, dated 05 September 2017). A broad
anomalous intercept was reported from WRDD003 (ASX announcement, dated 10 November 2017):
(cid:1)
WRDD003
71.0m @ 0.21% Cu, from 365m, including
5.5m @ 0.49% Cu, from 396m
2.5m @ 2.53% Cu, from 419m
5.0m @ 0.5% Cu, from 431m
2.5m @ 0.32g/t Au, from 419m
0.5m @ 0.55g/t Au, from 434m
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DIRECTORS’ REPORT
Two zones of anomalous copper were reported from WRDD004 (ASX announcement, dated 24 January 2018),
with thinner zones of higher-grade copper and gold included, as follows:
(cid:1)
WRDD004
6.8m @ 0.35% Cu, from 272m, including
10.8m @ 0.34g/t Au
72.0m @ 0.21% Cu, from 344m, including
16.7m @ 0.44% Cu
6.8m @ 0.37g/t Au
3.0m @ 0.40g/t Au
Figure 2: Cross section through WRDD004, Wodger Prospect
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Figure 3: Long section, Wodger Prospect, to show intercepts of WRDD003 & WRDD004.
Three down-hole electromagnetic (DHEM) surveys were completed at Wodger. Only one off-hole conductor was
identified, from WRDD003, and this was tested by WRDD004. The EM response is now interpreted to have
been due to conductive regolith in a zone of preferential weathering.
One diamond core hole (FGDD007, for 580m) was drilled at the Forrest Prospect at the end of 2017, to test a
remodelled ground EM anomaly, which was thought to be coincident with a blind anticline (analogous to the
interpretation for Wodger). Two thin zones of anomalous copper were reported from FGDD007 (ASX
announcement, dated 24 January 2018):
(cid:1)
FGDD007
2.0m @ 0.10% Cu, from 474m
2.0m @ 0.11% Cu, from 335m
A DHEM survey in FGDD007 had to be abandoned before completion, but no conductor was recognised in the
part of the hole that was surveyed (350-580m). The weak ground EM anomaly at Forrest is not properly
explained but, given that the DHEM response in FGDD007 is similar to others at Wodger, it is possible that deep
weathering and/or conductive cover may be the cause.
Both Wodger diamond core holes were originally interpreted to have drilled across the Wodger Anticline, starting
in Ravelstone Formation sediments, through Narracoota Formation volcanics, and ending back in Ravelstone
Formation. However, consistent up-hole younging directions at Wodger suggest that the stratigraphy at the
prospect is not folded, as previously thought. The lower/north-eastern Narracoota Formation contact is
interpreted to be structural in nature, which is consistent with the quartz-carbonate veining associated with the
broad, anomalous intercepts of copper and gold. Copper sulphides, including bornite, minor chalcopyrite and
chalcocite. The mineralised structure may be a back-thrust.
Another possibility is that the sediments that occur beneath the Narracoota Formation at Wodger are Karalundi
Formation (ASX announcement, dated 17 July 2018). Further work (including more drilling) will probably be
required to resolve the interpretation.
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Figure 4: Cross section of FGDD007, Forrest Prospect
All diamond core and RC chips from the Wodger and Forrest Prospects have been re-logged as part of a
comprehensive geological review, and two structural experts have been engaged to provide input.
A new geological model will inform where additional drilling might be necessary to advance both prospects.
Gravity Surveys at Horseshoe and Forrest
Gravity surveys were completed on all three tenements on the Horseshoe Project and on E52/1659 on the
Forrest Project. This completes the ground gravity coverage of the entire tenement portfolio in the Bryah Basin.
These data sets were important sources of information for the regional and detailed geological interpretations
(see below).
Regional and Detailed Geological Interpretations
A regional (1:100,000 scale) geological interpretation of the entire western Bryah Basin was compiled to provide
context for all future exploration in the district (ASX announcement, dated 30 January 2018). The data sets used
for this exercise included the following:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
Airborne magnetic and radiometric surveys;
Ground gravity surveys;
Airborne and ground EM data (including the most recently acquired VTEM data);
Surface geochemical sampling data;
Government magnetic and radiometric data;
Government-sponsored EM – a SPECTREM survey flown specifically to map the Bryah Basin;
Government mapping (of geology and regolith) and geochemical sampling – by the Geological Survey
of Western Australia (at 1:100,000 scale);
Landsat TM imagery;
ASTER imagery.
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Interestingly, the prospective Karalundi Formation (which hosts the DeGrussa Cu-Au deposit) is interpreted to
be thicker and more continuous in the southern Cashman area than has previously been mapped (by the
Geological Survey), and much more structural detail has been revealed in the area immediately south of the
Peak Hill Mining District (ASX announcement, dated 17 July 2018). Both of these new insights are significant
for future exploration plans.
620,000 mE
640,000 mE
660,000 mE
680,000 mE
N
m
0
0
0
,
0
6
1
,
7
N
m
0
0
0
,
0
4
1
,
7
N
m
0
0
0
,
0
2
1
7
,
LEGEND
Auris tenement outline
Structures
Unit Dip Direction
Unit Trend
Unit contact
Dyke units
Unit Contact; Major and often sheared
Unit Contact; Minor
Unit Contact; Major uncertain
BIF Contact
Mafic Dyke Reverse
Mafic Dyke Normal
Mafic Dyke Normal
Mafic Dyke Reverse
Felsic Dyke
Interpreted shears
Interpreted faults
Sense of Direction
Shear with sense of normal dip slip
and commonly inverted during
compression
Shear; Minor
Shear; Minor with dip slip motion
Brittle Fault; Minor
Brittle Fault; Minor
uncertain
Brittle Fault; Major
Brittle Fault; Major
uncertain
Anomalous gravity response
Gravity High Zone
Gravity Low Zone
Interpreted Geology
Mt Leake Formation: quartz arenite
Millidie Creek Formation: sandstone, shale, BIF granular iron -formation
Robinson Range Formation: shale, siltstone and BIF granular iron
Wilthorpe Formation: conglomerate, sandstone and siltstone
Labouchere Formation: sandstone, siltstone with some BIF , chert and conglomerate
Horseshoe Formation: sandstone and BIF granular iron
Ravelstone Formation: lithic -feldspathic sandstone, siltstone and chert turbiditic
Narracoota: turbidites and volcanics
Narracoota: schist after basalt and dolerite
Narracoota: mafics, basalt, pyroxenite and dolerite
Narracoota: hyaloclastite
Narracoota: breccia agglomerate
Karalundi Formation: sandstone, shale and conglomerate
Mooloogool Supergroup: mixed Doolgunna Formation, sandstones, conglomerate, siltstone
and chert with sedimentary deposits of possible Thaduna, Maraloou and Killara Formations
Johnson Cairn Formation: siltstone, shale and some sandstone
Juderina Formation: sandstone, siltstone, shale and conglomerate
Finlayson Member (Juderina Formation): quartz arenite
Peak Hill Schist: meta-Yerrida Group
Yilgarn Craton Granite Gneiss, includes some greenstone and amphibolite
Yilgarn Ultramafic, greenstone
Black Shale
Banded Iron Formation
0
10
kilometres
Scale 1:100,000
Datum : GDA 94
Projection : MGA 50
Regional Setting
7
,
1
6
0
,
0
0
0
m
N
7
,
1
4
0
,
0
0
0
m
N
7
,
,
1
2
0
0
0
0
m
N
Preliminary 1:100,000 map scale
bedrock geology and structure
interpretation
Date : 05/07/2018
620,000 mE
640,000 mE
660,000 mE
680,000 mE
Plot Name : C_A0_100k_prelim_interp
Figure 5: Regional geological interpretation (1:100,000 scale) of the SW Bryah Basin (including Cashman and Morck Well
West Project Areas). Location of Feather Cap Prospect.
The same data sets have been used to produce a more detailed (1:25,000 scale) geological interpretation over
the Forrest Project area of interest, between the Forrest and Big Billy Prospects, along the so-called “prospective
trend”. In this area, the prospective Narracoota Formation is interpreted to be more pervasive than has been
previously mapped (ASX announcement, dated 5 September 2018). Furthermore, the Narracoota is interpreted
to be folded and kinked along strike, which may be significant as a control on the location of copper and gold
mineralisation.
A detailed map is currently being prepared for the southern Cashman area of interest.
VTEM Exploration Activities - Cashman, Forrest and Horseshoe Projects
An airborne Versatile Time-Domain EM (VTEM) survey was completed over key areas of the Cashman, Forrest
and Horseshoe Projects (ASX announcement, dated 20 February 2018). The VTEM™Max system is one of the
best airborne EM systems flying worldwide, for mineral exploration, and is specifically designed for detecting
discrete conductors, such as massive sulphide deposits. However, it is also useful for mapping conductive cover
and, as such, is a useful tool for mapping areas that may not be suitable for surface geochemical sampling. In
total, 1,802 line km were surveyed with VTEM, on 200m line intervals, with a sensor height at an altitude of 35m.
After data processing and interpretation, and integration with other data, a total of 65 discrete VTEM targets
were identified (ASX announcement, dated 27 July 2018). Four are considered Priority-1 targets, 23 are Priority-
2 targets, and 38 are Priority-3 targets. 39 targets were identified on the Cashman Project, eighteen are on the
Forrest Project, and the remaining eight are at Horseshoe West. Three Priority-1 targets were identified at
Cashman and one is at Forrest.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
14 | P a g e
DIRECTORS’ REPORT
Most importantly, eleven targets were coincident with the prospective Karalundi Formation, which is host to the
De Grussa Cu-Au deposit, and 33 are coincident with the volcanic Narracoota Formation, which hosts the
Horseshoe Lights Cu-Au deposit.
Figure 6: VTEM targets, Forrest (A) and Cashman (B) Projects
Soil Sampling at Cashman
A new geochemical sampling programme, involving the collection of more than 3,500 soil samples, on a 200 x
100m grid (ASX announcement, dated 17 July 2018) was planned and started during the reporting period. The
area being sampled covers the full extent of the prospective Karalundi Formation on the southern Cashman
area of interest (indicated as the Prospective Area in Fig. 6B). This area includes the Orient Prospect, where
surface samples have assayed at up to 12.8% Cu and 41.7g/t Au. The sampling will cover most of the new
VTEM targets at Cashman, including all of the Priority-1 targets.
Aircore Drilling at Feather Cap
An aircore drilling programme of 40 holes (2,281m) was completed on the Feather Cap Prospect, located south
of the Peak Hill Mining District (Fig. 5, with assays pending). Feather Cap had been interpreted (from ground
gravity data) to be a north-northwest trending structural gold target, but it is now recognised to correlate with the
top of the volcanic Narracoota Formation, along a northwest-trending synclinal fold axis. This stratigraphic
setting is considered to be prospective for Horseshoe Lights-type Cu/Au mineralisation.
Auris Minerals Limited I 2018 ANNUAL REPORT
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DIRECTORS’ REPORT
Morck Well JV (Managed by Sandfire Resources NL – to earn a 70% interest)
At the end of February 2018, Auris entered into a Farm-in Agreement (“the Agreement”) with Sandfire Resources
NL in relation to the Morck Well East and Doolgunna Projects (ASX announcement, dated 27 February 2018).
Sandfire has the right to earn a 70% interest in either project upon completion of a Feasibility Study on a
discovery of not less than 50,000t of contained copper (or metal equivalent).
Within two weeks of the Company entering the Agreement, an airborne EM survey (using the VTEM™Max
system) was undertaken across the Morck Well East JV area (ASX announcement, dated 27 March 2018) and
was completed in April 2018. Two clusters of VTEM anomalies were interpreted, but follow-up moving loop EM
(MLEM) surveys have indicated that the anomalies are most likely due to paleo-drainages within the regolith.
In May 2018, Sandfire began an aircore drilling program on the Morck Well East JV Project. Soon after, narrow
zones of sulphide and supergene copper mineralisation were reported from three contiguous holes (ASX
announcement, dated 20 July 2018). The three intercepts assayed as follows:
(cid:1)
(cid:1)
(cid:1)
MWAC0109
11m @ 3.5% Cu, from 73m, including
3m @ 9.5% Cu, from 81m
MWAC0111
6m @ 1.3% Cu, from 112m, including
1m @ 4.5% Cu, from 113m
MWAC0112
9m @ 2.3% Cu, from 146m, including
3m @ 5.7% Cu, from 149m
Subsequent follow-up by RC and diamond core drilling, and a DHEM survey, have demonstrated that the
mineralisation has limited down-dip continuity and strike extent, although the diamond core also clearly confirms
the favourable nature of the geological sequence, in terms of prospectivity.
The aircore drilling programme is ongoing and a total of 506 holes were completed across the JV project area
in Q2 2018 (35,350m). Post-period end, Sandfire confirmed that a MLEM survey had begun and that this would
extend across the full prospective sequence over the entire Morck Well JV Project area. In addition, further RC
drill holes are being planned to further investigate the strike extent southwest of the aircore hits.
Chunderloo Project Review
As the main exploration focus this year was on the Bryah Basin, work on Chunderloo was restricted to
comprehensive review of previous work, historical data collected on this Project and an airbourne magnetic
survey conducted over the project area in August 2017.
Future Work Plans
Work plans are currently focused on target generation/confirmation in the Bryah Basin, via the geochemical soil
sampling programme at Cashman, field checking and follow-up MLEM surveys of the top priority VTEM targets,
and completion of the new regional and detailed geological interpretations. Targets will be drill-tested as soon
as possible. In addition, a geological review of the Wodger and Forrest Prospects is nearing completion and it
is likely that further drilling will be required to advance those prospects.
Further target generative work will include more geochemical soil sampling in areas where there is minimal
transported cover and/or the regolith is not too deep. Systematic aircore drilling may be necessary in some
problematic areas, but these will be targeted to save on costs. Appropriate ground geophysical surveys will be
conducted, as required to complement the geochemical targeting.
Corporate
On 27 February 2018 the Company announced it had entered a Farm-in Agreement with Sandfire Resources
NL (“Sandfire”) in relation to the Morck Well East and Doolgunna Projects. The transaction with Sandfire allows
the Company to focus on copper-gold exploration on its key Forrest, Cashmans and Horseshoe projects in the
Bryah Basin.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
16 | P a g e
DIRECTORS’ REPORT
On 20 April 2018, shareholders voted in favour of a Board restructure and Mr Neville Bassett and Mr Brian
Thomas joined the Board as Non-Executive Directors. Mr Bassett replaced Ms Bronwyn Barnes as Chair of the
Company (ASX announcement dated 26 April 2018). On 2 August 2018, the Company announced the
appointment of Mr Craig Hall as Non-Executive Director of the Board. Mr Hall has been nominated to represent
the interests of Investmet Limited as a replacement to Ms Barnes.
Mr Craig Hall is an experienced geologist with over 30 years of minerals industry experience in exploration,
development and production roles in a range of commodities, principally precious and base metals. He has held
a variety of senior positions with mid-tier and junior sector resource companies within Australia and overseas.
He has previously consulted to the minerals industry providing high quality exploration outcomes, on-site mining
support, expert reporting, project valuations and strategic advice to companies through an association with a
well-respected Western Australian resource consultancy. Until 6 August 2018, Mr Hall served as a Non-
Executive Director of Eclipse Metals Ltd (ASX: EPM) an Australian exploration company focused on exploring
the Northern Territory and Queensland for uranium and manganese mineralisation.
On 6 July 2018, the Company announced that Mr Wade Evans had ceased employment as the Company’s
CEO. The Company also announced the appointment of highly experienced finance executive, Mr Mike
Hendriks, on an initial 3-month consultancy arrangement to oversee day-to-day management of the Company.
Mr Hendriks is a Chartered Accountant and has gained extensive experience in the financial services sector in
various roles in the banking and stockbroking industries. He also has extensive experience as a company
director and secretary holding various executive and non-executive directorships of listed and unlisted
companies in both the industrial and resource sectors.
During the year, the following securities were issued by the Company:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
21,000,000 ordinary fully paid shares at an issue price of $0.08 each, by way of placement, to raise
$1,680,000;
25,488,478 ordinary fully paid shares on the exercise of the same number of options at an exercise price
of $0.08 each raising $2,039,078. The exercise of options included the issue of 15,625,000 ordinary
fully paid shares that were subject to an underwriting agreement;
73,727 ordinary fully paid shares on the exercise of the same number of options at an exercise price of
$0.12 each raising $8,847;
7,000,000 ordinary fully paid shares as consideration for the acquisition of Doolgunna tenement
E52/2438;
40,314 ordinary fully paid shares at an issue price of $0.0593 each in satisfaction for interest owing on
convertible notes; and
16,000,000 performance rights expiring 20 November 2020 issued in two equal tranches, each with
market based performance milestones. 8,000,000 vesting upon achieving a market capitalisation of $48
million for a period of 30 consecutive days and 8,000,000 vesting upon achieving a market capitalisation
of $60 million for a period of 30 consecutive days.
On 20 September 2017, 39,912,980 listed options exercisable at $0.12 each expired unexercised.
On 20 June 2018, 49,702,731 listed options exercisable at $0.12 each expired unexercised.
On 20 April 2018, pursuant to the terms of issue, 2,000,000 performance rights automatically lapsed.
Subsequent to year end, pursuant to the terms of issue, 8,000,000 performance rights have automatically
lapsed.
On 2 July 2018, the Company allotted 896,000 fully paid ordinary shares to a noteholder following the conversion
of two Convertible Notes approved by shareholders at the general meeting held 17 July 2015.
On 20 September 2018, 6,000,000 unlisted options exercisable at $0.12 expired.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
17 | P a g e
DIRECTORS’ REPORT
5.
Significant Changes in the State of Affairs
In the opinion of the directors there were no significant changes in the state of affairs of the Group that occurred
during the financial year, other than those described in this report under ‘Principal activities and review of
operations’.
6.
Environmental Regulations
The Group’s exploration activities are subject to various environmental regulations. The Board is responsible for
the regular monitoring of environmental exposures and compliance with environmental regulations.
The Group is committed to achieving a high standard of environmental performance and conducts its activities
in a professional and environmentally conscious manner and in accordance with applicable laws and permit
requirements. The Board believes that the Group has adequate systems in place for the management of its
environmental requirements and is not aware of any breach of those environmental requirements as they apply
to the Group.
The directors have considered the enacted National Greenhouse and Energy Reporting Act 2007 (the NGER
Act) which introduces 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 will have no effect on the
Company for the current financial year. The directors will reassess this position as and when the need arises.
7.
Dividends
The directors have not recommended the declaration of a dividend. No dividends were paid or declared during
the current or prior period.
8.
Events Subsequent to Reporting Date
Except for the events noted below, no other material events have occurred subsequent to the reporting date.
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
On 2 July 2018, 800,000 fully paid ordinary shares were issued following conversion of 2 Convertible
Notes and 96,000 fully paid ordinary shares were issued relating to the accrued interest on these
Convertible notes.
On 6 July 2018, Wade Evans resigned as Chief Executive Officer and Mr Mike Hendriks was appointed
on an initial 3 month consultancy to oversee day-to-day management.
On 20 July 2018, the follow-up drilling in the Morck Well Joint Venture was completed and the MLEM
surveying was underway.
On 27 July 2018, the VTEM survey identifies multiple targets in the Bryah Basin.
On 1 August 2018, Mr Craig Hall was appointed Non-Executive Director and is the nominated
representative for the interests of Investmet Limited.
On 5 September 2018, a new geological interpretation of the Forrest Project was completed.
On 14 September 2018, an Aircore drilling programme at the Wodger Prospect commenced.
On 20 September 2018, 6,000,000 unexercised $0.12 options expired.
9.
Likely Developments
Comments on expected results of certain operations of the Group are included in this financial report under
section 4, principal activities and review of operations.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
18 | P a g e
DIRECTORS’ REPORT
10.
Share Options
Unissued shares under option
At the date of this report unissued ordinary shares of the Company under option are:
Expiry date
Exercise Price
No. of options
3-Oct-18
8-Oct-19
$0.60
$1.30
1,480,000 Unlisted
2,500,000 Unlisted
3,980,000
The options do not entitle the holder to participate in any share issue of the Company or any other body
corporate.
Other shares issued since the end of the financial year
Issue date
Share price
No. of
shares
Nature
2 July 2018
$0.05
896,000
Conversion of convertible notes and accrued interest
11.
Convertible Notes
The following convertible notes have been converted during or since the end of the financial year:
Face Value
No. of Notes
Total Value
Conversion
Rate
$20,000
2
$40,000
$0.05
The following convertible notes remain on issue at the end of the financial year:
Face Value
No. of Notes
Total Value
Conversion
Rate
$20,000
2
$40,000
$0.05
The conversion rate has been restated on a post-consolidation basis.
As the convertible notes expire on 1 July 2018, the notes were converted on 2 July 2018 and earnt interest at a
rate of 12% per annum.
12.
Remuneration Report - Audited
Principles of compensation
Remuneration is referred to as compensation throughout this report.
Key management personnel have authority and responsibility for planning, directing and controlling the activities
of the Group. Key management personnel comprise the directors of the Group.
Compensation levels for key management personnel of the Group are competitively set to attract and retain
appropriately qualified and experienced directors and executives. The Board obtains independent advice on the
appropriateness of compensation packages of the Group given trends in comparative companies both locally
and internationally and the objectives of the Group’s compensation strategy.
The compensation structures explained below are designed to attract suitably qualified candidates, reward the
achievement of strategic objectives, and achieve the broader outcome of creation of value for shareholders.
Compensation packages include a mix of fixed compensation, equity-based compensation, performance-based
compensation as well as employer contributions to superannuation funds.
Auris Minerals Limited I 2018 ANNUAL REPORT
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DIRECTORS’ REPORT
Shares and options may only be issued to directors subject to approval by shareholders in general meeting.
Fixed compensation
Fixed compensation consists of base compensation as well as employer contributions to superannuation funds.
Compensation levels are reviewed annually by the Board through a process that considers individual and overall
performance of the Group. In addition, from time to time external consultants provide analysis and advice to
ensure the directors’ and senior executives’ compensation is competitive in the market place. The Group did not
employ the services of any remuneration consultants during the financial year ended 30 June 2018.
Performance linked compensation (Short-term incentive bonus)
In considering the Group’s strategic objectives the Board may integrate certain performance linked short-term
incentives (STIs) into key management personnel compensation packages.
Performance linked compensation primarily include STIs and are considered by the Board as and when projects
are delivered and are entirely at the Board’s discretion. The measures chosen are designed to align the
individual’s reward to the achievement of the Group’s strategies and goals and to reward key management
personnel for meeting or exceeding their personal objectives. No bonuses were paid during the financial year.
Equity based compensation (Long-term incentive bonus)
The Board provides equity-based long-term incentives (LTIs) to promote continuity of employment and to provide
additional incentive to key management personnel to increase shareholder wealth. LTIs are provided as options
and rights over ordinary shares of the Company and are provided to key management personnel based on their
level of seniority and position within the Group. Options and rights may only be issued to directors subject to
approval by shareholders in general meeting.
Key Management Personnel Incentives
Short-term and long-term incentive structure and consequences of performance on shareholder wealth have
been considered. However given the Group’s principal activity during the course of the financial year consisted
of exploration and evaluation, the Board has given more significance to service criteria instead of market related
criteria in setting the Group’s incentive schemes. Accordingly, at this stage the Board does not consider the
Company’s earnings or earning measures to be an appropriate key performance indicator. The issue of options
or rights as part of the remuneration package of directors is an established practice for listed exploration
companies and has the benefit of conserving cash whilst appropriately rewarding the directors. In considering
the relationship between the Group’s remuneration policy and the consequences for the Company’s shareholder
wealth, changes in share price are analysed.
The Group’s respective earnings and share price for the period 1 July 2013 to 30 June 2018 are as follows:
30 Jun 14
30 Jun 15
30 Jun 16
30 Jun 17
30 Jun 18
Net loss
(7,866,050)
(20,162,654)
(6,260,965)
(884,710)
(1,317,036)
Closing ASX share price
$0.20
$0.017
$0.013
$0.057
$0.068
Note the closing prices for the period 30 June 2014 to 30 June 2016 are based on pre-consolidation figures.
In the opinion of the Board, these earnings, as listed above, are largely irrelevant for assessing the Group’s
respective performance during the exploration and evaluation phases.
Service contracts
i)
Non-Executive Chair
Director and consulting services are provided by Mr Bassett via an associated company on normal commercial
terms and conditions.
The Non-Executive Chair rate was set at $45,000 per annum with effect from 1 February 2017, previously
$60,000 per annum. Additional fees are paid to Mr Bassett for any additional duties performed outside his role
as Non-Executive Chair at a rate of $1,500 per day.
20 | P a g e
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
DIRECTORS’ REPORT
ii)
Executive Director
Services were provided by Mrs Fullarton
(cid:1)
(cid:1)
(cid:1)
(cid:1)
Remuneration - $225,000 per annum, (excluding superannuation)
Superannuation - $21,375
Termination notice required - 3 months
Termination benefit: $56,250
iii)
Non-Executive Directors
Non-Executive Directors are currently paid at a rate of $30,000 per annum (previously $50,000 per annum) on
a continuous service arrangement requiring at least one month’s notice for termination. Total compensation for
all Non-Executive Directors are set based on advice, from time to time, from external advisors with reference to
fees paid to other Non-Executive Directors of comparable companies. The Group did not employ the services
of any remuneration consultants during the financial year ended 30 June 2018. Non-Executive Directors’ fees
are presently limited to $250,000 per annum, excluding director services charged under management or
consulting contracts.
Directors’ fees cover all main Board activities. The Board has no established retirement or redundancy schemes
in relation to Non-Executive Directors.
iv)
Changes in Directors and Executives subsequent to year end
Wade Evans resigned from the position of Chief Executive Officer on 6 July 2018.
Bronwyn Barnes was removed as a Non-Executive Director on 1 August 2018 as a result of the general meeting
held on 20 April 2018, in which Bronwyn remained as a director of Auris Minerals Ltd until which time Investmet
found a replacement to represent their interests.
Mr Craig Hall was appointed Non-Executive Director on 1 August 2018 as the nominated representative for
Investmet Limited.
Auris Minerals Limited I 2018 ANNUAL REPORT
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DIRECTORS’ REPORT
Key Management Personnel remuneration
Details of the nature and amount of each major element of remuneration are as follows:
Key Management
Personnel (KMP)
Short
term
salary
and fees
Super-
annuation
benefits
Termination
benefits
Equity
settled
share
based
payments (i)
Total
Proportion of
remuneration
performance
related
Value of
options as
proportion of
remuneration
$
$
$
$
$
%
%
Non-Executive Chair
N Bassett (ii)
M Kennedy(iii)
2018
2017
2018
2017
8,875
-
-
13,334
Chief Executive Officer
-
-
-
-
W Evans (iv)
D Morgan (v)
2018
2017
2018
2017
Chief Operating Officer
211,718
20,113
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
8,875
-
-
13,334
264,000 495,831
-
-
-
-
50,621
3,563
56,250
- 110,434
M Hendriks (vi)
2018
2017
-
-
-
-
-
-
-
-
-
-
Executive Director
D Fullarton (vii)
2018
2017
Non-Executive Directors
C Hall (viii)
B Thomas (ix)
B Barnes (x)
S Vearncombe
(xi)
R Martin (xii)
N Anderson
(xiii)
S Heggen (xiv)
Total
2018
2017
2018
2017
2018
2017
2018
2017
2018
2017
2018
2017
2018
2017
2018
2017
20,985
8,392
86,336
- 115,713
165,000
25,000
-
-
-
-
5,700
217
-
48,869
46,473
20,617
-
30,000
25,000
-
-
-
-
-
-
-
-
-
27,669
2,629
-
-
22,070
2,097
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
41,338 231,338
-
-
-
-
-
-
5,917
-
88,000 136,869
41,338
87,811
-
-
20,617
-
88,000 118,000
20,670
45,670
-
-
-
-
-
30,298
-
24,167
346,764
28,722
86,336
440,000 901,822
350,167
33,289
56,250
103,346 543,052
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
53
-
-
-
-
-
-
18
-
-
-
-
64
47
-
-
75
45
-
-
-
-
49
19
(i)
(ii)
The fair value of the equity settled share based payments are detailed in Note 19 of the Notes to the Financial Statements.
Neville Bassett was appointed Non-Executive Chair on 20 April 2018.
(iii)
Miles Kennedy resigned as Non-Executive Chair on 30 August 2016.
(iv) Wade Evans was appointed CEO on 17 July 2017; Resigned 6 July 2018.
(v)
David Morgan resigned as CEO on 1 September 2016.
Auris Minerals Limited I 2018 ANNUAL REPORT
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22 | P a g e
DIRECTORS’ REPORT
(vi)
Mike Hendriks was appointed as COO on 6 July 2018 on an initial 3-month consultancy arrangement.
(vii)
Debbie Fullarton resigned as Executive Director on 11 August 2017.
(viii) Craig Hall was appointed as Non-Executive Director on 1 August 2018 as the Investmet representative.
(ix)
Brian Thomas was appointed as Non-Executive Director on 20 April 2018.
(x)
Bronwyn Barnes was appointed Non-Executive Chair on 25 November 2016 and ceased as Chair on 20 April 2018 and
remained as a Non-Executive Director; Removed 1 August 2018.
(xi)
Susan Vearncombe was appointed Non-Executive Director on 14 August 2017; Removed 20 April 2018.
(xii)
Robert Martin was appointed 2 November 2016.
(xiii) Nannette Anderson resigned 3 February 2017.
(xiv)
Simon Heggen resigned 25 November 2016.
Equity instruments
Options holdings
Options refer to options over ordinary shares of Auris and are exercisable on a one-for-one basis. Details of
options over ordinary shares in Auris that were granted and vested as compensation to each key management
person are as follows:
Balance at 1
Jul 17 or
date of
appointment
Granted as remuneration
Issue
date
No.
Value
Exercised
Lapsed
Other
changes (i)
Balance at 30
June 18 or date
of resignation
Non-Executive Chair
N Bassett
Chief Executive Officer
W Evans
Chief Executive Officer
M Hendriks
Executive Director
-
-
-
D Fullarton
2,890,168
Non-Executive Directors
C Hall
B Thomas
R Martin
B Barnes
-
-
4,945,632
2,182,610
S Vearncombe
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,890,168
-
-
(1,972,816)
(2,139,483)
166,667
1,000,000
(91,305)
(91,305)
-
-
-
-
2,000,000
-
(i)
Recognising Rob Martin’s relevant interest in SDB Drilling Pty Ltd as announced on 9 April 2018.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
23 | P a g e
DIRECTORS’ REPORT
Balance at
30 Jun 18
Vested
Exercisable
Un-exercisable
Total
Unvested
Non-Executive Chair
N Bassett
Chief Executive Officer
W Evans
Chief Operating Officer
M Hendriks
Executive Director
D Fullarton
Non-Executive Directors
C Hall
B Thomas
R Martin
B Barnes
S Vearncombe
-
-
-
-
-
-
-
-
-
-
-
-
1,000,000
2,000,000
-
1,000,000
2,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,000,000
2,000,000
-
-
-
-
-
-
-
-
-
No terms of equity-settled share-based payment transactions (including options and rights granted as
compensation to a key management person) have been altered or modified by the issuing entity during the
reporting period or the prior period.
During the reporting period, no shares were issued on exercise of options previously granted as compensation
and no options were forfeited by key management persons during the reporting period.
Rights holdings
Rights refer to performance rights held over ordinary shares of the Company and are exercisable on a one-for-
one basis when vesting conditions are met. Details of the grant of performance rights to key management
personnel are set out in the table below.
Tranche
Balance at 1
Jul 17 or
date of
appointment
Granted as remuneration
Issue
date
No.
Value
Exercised Lapsed
Other
changes
(i)
Balance at 30
Jun 18 or
date of
resignation
Non-Executive Chair
N Bassett
Chief Executive Officer
W Evans
Chief Operating Officer
M Hendriks
Executive Director
D Fullarton
Non-Executive Directors
C Hall
B Thomas
R Martin
B Barnes
S Vearncombe
-
1
2
-
-
-
-
1
2
1
2
1
2
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
22/11/2017 3,000,000 141,000
22/11/2017 3,000,000 123,000
-
-
-
-
-
-
-
-
-
-
-
-
22/11/2017 1,000,000
47,000
22/11/2017 1,000,000
41,000
22/11/2017 1,000,000
47,000
22/11/2017 1,000,000
41,000
22/11/2017 1,000,000
47,000
22/11/2017 1,000,000
41,000
(i)
Performance rights cancelled on removal of key management personnel.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1,000,000)
(1,000,000)
-
3,000,000
3,000,000
-
-
-
-
1,000,000
1,000,000
1,000,000
1,000,000
-
-
24 | P a g e
DIRECTORS’ REPORT
Share holdings
No shares were granted to key management personnel during the reporting period as compensation in 2017 or
2018.
The movement during the reporting period in the number of ordinary shares in Auris Minerals Limited held,
directly, indirectly or beneficially, by each key management person, including their related parties, is as follows:
Balance at 1
Jul 17 or
date of
appointment
1,100,000
-
-
1,950,833
-
-
19,728,140
913,044
-
Non-Executive Chair
N Bassett
Chief Executive Officer
W Evans
Chief Operating Officer
M Hendriks
Executive Director
D Fullarton
Non-Executive Directors
C Hall
B Thomas
R Martin
B Barnes
S Vearncombe
Granted as
remuneration
Exercise of
options
Other
changes (i)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,972,816
91,305
-
-
8,950,530
-
-
Balance at
30 Jun 18 or
date of
resignation
1,100,000
-
-
1,950,833
-
-
30,651,486
1,004,349
-
(i)
Net movement of establishment and cessation with associated entities and announcement of relevant interest in SDB Drilling
Pty Ltd and Bulletin Resources Ltd.
Other Equity-related KMP Transactions
There have been no other transactions involving equity instruments apart from those described in the tables
above relating to options, rights, and shareholdings.
Other Transactions with KMP and / or their Related Parties
There were no other transactions conducted with the Group and KMP or their related parties, apart from those
disclosed above relating to equity, compensation and loans, that were conducted other than in accordance with
normal employee, customer or supplier relationships on terms no more favourable than those reasonably
expected under arm’s length dealings with unrelated persons.
END OF AUDITED SECTION
13.
Proceeding on Behalf of Company
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 party to any such proceedings during the year.
14.
Diversity
The Board is committed to having an appropriate blend of diversity on the Board and in all areas of the Group’s
business. The Board has established a policy (‘Diversity Policy’ or ‘policy’) regarding gender, age, ethnic and
cultural diversity. Details of the policy are available on the Company’s website.
Diversity Policy
The Company and all its related bodies corporate are committed to workplace diversity.
Auris Minerals Limited I 2018 ANNUAL REPORT
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25 | P a g e
DIRECTORS’ REPORT
The Company recognises the benefits arising from employee and Board diversity, including a broader pool of
high quality employees, improving employee retention, accessing different perspectives and ideas and
benefiting from all available talent.
Diversity includes, but is not limited to, gender, age, ethnicity and cultural background.
To the extent practicable, the Company will address the recommendations and guidance provided in the ASX
Corporate Governance Council's Principles and Recommendations.
The Diversity Policy does not form part of an employee's contract of employment with the Company, nor gives
rise to contractual obligations. However, to the extent that the Diversity Policy requires an employee to do or
refrain from doing something and at all times subject to legal obligations, the Diversity Policy forms a direction
of the Company with which an employee is expected to comply.
The key objectives of the Diversity Policy are to achieve:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
a diverse and skilled workforce, leading to continuous improvement in service delivery and achievement
of corporate goals;
a workplace culture characterised by inclusive practices and behaviours for the benefit of all staff;
improved employment and career development opportunities for women;
a work environment that values and utilises the contributions of employees with diverse backgrounds,
experiences and perspectives through improved awareness of the benefits of workforce diversity and
successful management of diversity; and
awareness in all staff of their rights and responsibilities with regards to fairness, equity and respect for
all aspects of diversity.
The Diversity Policy does not impose on the Company, its directors, officers, agents or employee any obligation
to engage in, or justification for engaging in, any conduct which is illegal or contrary to any anti-discrimination or
equal employment opportunity legislation or laws in any State or Territory of Australia or of any foreign
jurisdiction.
Diversity Reporting
The Group’s gender diversity as at the end of the reporting period is as follows:
Board representation
Group representation
30 June 2018
30 June 2017
Female
Male
Female
Male
No.
1
2
%
25
29
No.
3
5
%
75
71
No.
2
2
%
67
40
No.
1
3
%
33
60
The Company’s proposed diversity objective for the 2018 financial year are to continue to assess and proactively
monitor gender diversity at all levels of the Company’s business and the implementation and effectiveness of
the Company’s diversity initiatives and programs.
15.
Indemnification and Insurance of Officers and Auditors
Indemnification
The Group indemnifies each of its directors and company secretary. The Group indemnifies each director or
officer to the maximum extent permitted by the Corporations Act 2001 from liability to third parties, except where
the liability arises out of conduct involving lack of good faith, and in defending legal and administrative
proceedings and applications for such proceedings.
Auris Minerals Limited I 2018 ANNUAL REPORT
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DIRECTORS’ REPORT
The Group must use its best endeavours to insure a director or officer against any liability, which does not arise
out of a conduct constituting a wilful breach of duty or a contravention of the Corporations Act 2001. The Group
must also use its best endeavour to insure a director or officer against liability for costs and expenses incurred
in defending proceedings whether civil or criminal.
The Group has not entered into any agreement with its current auditors indemnifying them against any claims
by third parties arising from their report on the financial report.
The directors of the Company are not aware of any proceedings or claim brought against Auris Minerals Ltd or
its controlled entities as at the date of this report.
Insurance
The Group holds cover in respect of directors’ and officers’ liability and legal expenses’ insurance, for current
and former directors and officers of the Group. The premium paid during the year was $9,424.
16.
Non-audit Services
During the year Greenwich & Co, the Company’s auditor, did not perform any services other than their audit
services.
In the event that non-audit services are provided by Greenwich & Co, the Board has established certain
procedures to ensure that the provision of non-audit services are compatible with, and do not compromise, the
auditor independence requirements of the Corporations Act 2001. These procedures include:
(cid:1)
(cid:1)
non-audit services will be subject to the corporate governance procedures adopted by the Group and
will be reviewed by the Group to ensure they do not impact the integrity and objectivity of the auditor;
and
ensuring non-audit services do not involve reviewing or auditing the auditor’s own work, acting in a
management or decision making capacity for the Group, acting as an advocate for the Group or jointly
sharing risks and rewards.
Details of the amounts paid to the auditor of the Company and their related practices for audit services provided
during the year are set out below.
Audit and review of financial reports
2018
$
29,000
29,000
2017
$
28,000
28,000
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
27 | P a g e
DIRECTORS’ REPORT
18.
Competent Person’s Statement
Competent Person’s Statement
Information in this report that relates to exploration results is based on and fairly represents information and
supporting documentation prepared and compiled by Nick Franey MSc (Mineral Exploration) who is a Member
of the Australasian Institute of Geoscientists.
The information in this report that relates to previously released exploration was first disclosed under the JORC
Code 2004. It has not been updated to comply with the JORC Code 2012 on the basis that the information has
not materially changed since it was last reported and is based on and fairly represents information and
supporting documentation prepared and compiled by Nick Franey MSc (Mineral Exploration) who is a Member
of the Australasian Institute of Geoscientists.
Mr Franey is General Manager Geology for Auris Minerals Limited. Mr Franey has sufficient experience which
is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is
undertaking to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for
Reporting Exploration Results, Mineral Resources and Ore Reserves. Mr Franey consents to the inclusion in
the report of the matters based on this information in the form and context in which it appears.
No New Information
Except where explicitly stated, this report contains references to prior exploration results and Mineral Resource
estimates, all of which have been cross referenced to previous market reports made by the Company. The
Company confirms that it is not aware of any new information or data that materially affects the information
included in the relevant market announcements and, in the case of estimates of Mineral Resources that all
material assumptions and technical parameters underpinning the results and/or estimates in the relevant market
report continue to apply and have not materially changed.
Forward-Looking Statements
This report has been prepared by Auris Minerals Limited. This document contains background information about
Auris Minerals Limited and its related entities current at the date of this report. This is in summary form and does
not purport to be all inclusive or complete. Recipients should conduct their own investigations and perform their
own analysis in order to satisfy themselves as to the accuracy and completeness of the information, statements
and opinions contained in this report. This report is for information purposes only. Neither this document nor the
information contained in it constitutes an offer, invitation, solicitation or recommendation in relation to the
purchase or sale of shares in any jurisdiction.
This report may not be distributed in any jurisdiction except in accordance with the legal requirements applicable
in such jurisdiction. Recipients should inform themselves of the restrictions that apply in their own jurisdiction. A
failure to do so may result in a violation of securities laws in such jurisdiction. This document does not constitute
investment advice and has been prepared without taking into account the recipient’s investment objectives,
financial circumstances or particular needs and the opinions and recommendations in this representation are
not intended to represent recommendations of particular investments to particular investments to particular
persons. Recipients should seek professional advice when deciding if an investment is appropriate. All securities
transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or
political developments.
No responsibility for any errors or omissions from this document arising out of negligence or otherwise is
accepted. This document does include forward-looking statements. Forward-looking statements are only
predictions and are subject to risks, uncertainties and assumptions which are outside the control of Auris
Minerals Limited. Actual values, results, outcomes or events may be materially different to those expressed or
implied in this report. Given these uncertainties, recipients are cautioned not to place reliance on forward-looking
statements.
Any forward-looking statements in this report speak only at the date of issue of this report. Subject to any
continuing obligations under applicable law and ASX Listing Rules, Auris Minerals Limited does not undertake
any obligation to update or revise any information or any of the forward-looking statements in this document or
any changes in events, conditions or circumstances on which any such forward-looking statement is based.
28 | P a g e
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
DIRECTORS’ REPORT
19.
Lead Auditor’s Independence Declaration
The lead auditor’s independence declaration is set out on page 43 and forms part of the directors’ report for the
financial year ended 30 June 2018.
This report is made with a resolution of the directors.
NEVILLE BASSETT
NON-EXECUTIVE CHAIR
Dated at West Perth this 26th day of September 2018
Auris Minerals Limited I 2018 ANNUAL REPORT
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29 | P a g e
SCHEDULE OF MINING TENEMENTS
Schedule of Mining Tenements as at 30 June 2018
Tenement
number
Registered holder
Doolgunna Project
Date
granted
Area graticular
Blocks(bk) /
Hectares (ha)
Area
(Sq km)
Notes
E52/2438
Auris Minerals Limited
11/02/2010
7bk
21.68
1, 8
Morck Well Project
E51/1033
Auris Exploration Pty Ltd 80%
Jackson Minerals Pty Ltd 20%
22/09/2005
E51/1883
Auris Exploration Pty Ltd
Application
E52/1613
E52/1672
Auris Exploration Pty Ltd 80%
Jackson Minerals Pty Ltd 20%
Auris Exploration Pty Ltd 80%
Jackson Minerals Pty Ltd 20%
E52/1910
Auris Exploration Pty Ltd
E52/2472
Auris Exploration Pty Ltd
E52/3275
Auris Exploration Pty Ltd
E52/3327
Auris Exploration Pty Ltd
E52/3350
Auris Exploration Pty Ltd
E52/3351
Auris Exploration Pty Ltd
P52/1497
Auris Exploration Pty Ltd
P52/1503
Auris Exploration Pty Ltd
P52/1504
Auris Exploration Pty Ltd
Cashmans Project
E51/1053
Auris Exploration Pty Ltd
E51/1120
Auris Exploration Pty Ltd
E51/1391
Auris Exploration Pty Ltd 51%
Northern Star Resources Ltd 49%
29/03/2006
22/09/2005
10/08/2006
19/11/2009
1/06/2016
15/10/2015
2/03/2016
2/03/2016
6/03/2015
6/03/2015
6/03/2015
22/09/2005
10/08/2006
11/11/2010
E51/1641
Auris Exploration Pty Ltd
5/02/2015
Auris Exploration Pty Ltd 51%
Northern Star Resources Ltd 49%
19/01/2018
53bk
4bk
30bk
35bk
41bk
2bk
2bk
2bk
3bk
2bk
155.90ha
172.86ha
191.81ha
35bk
40bk
21bk
20bk
3bk
161.84
2, 3, 8
12.3
8
92.77
2, 3, 8
108.02
2, 3, 8
124.21
4
6.1
6.1
6.1
9.2
6.1
1.56
1.73
1.92
105.26
122.46
64.82
61.86
9.2
5
5
5
5
E51/1837
E51/1838
E52/2509
Auris Exploration Pty Ltd 51%
Northern Star Resources Ltd 49%
19/01/2018
11bk
33.62
Auris Exploration Pty Ltd 51%
Northern Star Resources Ltd 49%
16/06/2011
E52/3500
Auris Exploration Pty Ltd
5/10/2017
6bk
1bk
18.56
3.1
Forrest Project
E52/1659
E52/1671
Auris Exploration Pty Ltd 80%
Jackson Minerals Pty Ltd 20%
Auris Exploration Pty Ltd 80%
Jackson Minerals Pty Ltd 20%
27/01/2004
13bk
34.09
2, 6
23/11/2004
61bk
185.26
2, 6
P52/1493
Auris Exploration Pty Ltd
6/03/2015
191.66ha
P52/1494
Auris Exploration Pty Ltd 80%
Jackson Minerals Pty Ltd 20%
6/03/2015
179.33ha
1.92
1.79
6
2
Auris Minerals Limited I 2018 ANNUAL REPORT
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30 | P a g e
SCHEDULE OF MINING TENEMENTS
P52/1495
P52/1496
Auris Exploration Pty Ltd 80%
Jackson Minerals Pty Ltd 20%
Auris Exploration Pty Ltd 80%
Jackson Minerals Pty Ltd 20%
Horseshoe West Project
E52/3248
E52/3291
Auris Exploration Pty Ltd 85%
Omni Projects Pty Ltd 15%
Auris Exploration Pty Ltd 85%
Omni Projects Pty Ltd 15%
6/03/2015
181.09ha
6/03/2015
183.70ha
1.81
1.83
31/03/2015
11bk
33.62
2/03/2016
13bk
34bk
39.73
103.92
2
2
7
7
E52/3166
Auris Exploration Pty Ltd
18/12/2014
Chunderloo Project
M51/79
Auris Exploration Pty Ltd
26/06/1986
240.05 ha
M51/638
Auris Exploration Pty Ltd
25/10/2012
222.00 ha
M51/639
Auris Exploration Pty Ltd
25/10/2012
928.00 ha
E51/1830
Auris Exploration Pty Ltd
22/11/2017
1bk
P51/3013
Auris Exploration Pty Ltd
22/11/2017
182.116 ha
2.43
2.24
9.38
3.1
1.82
Notes:
Auris Exploration Pty Ltd (AE) is a wholly owned subsidiary of Auris Minerals Limited.
1. Ascidian Prospecting Pty Ltd hold a 1% gross revenue royalty from the sale of all minerals
2. Peak Hill Sale Agreement: AE 80%, Jackson Minerals Pty Ltd 20% & free carried to a decision to mine.
3. PepinNini Robinson Range Pty Ltd (PRR) hold a 0.8% gross revenue royalty from the sale or disposal of iron ore.
4. PRR hold a 1.0% gross revenue royalty from the sale or disposal of iron ore.
5. Earning 70% JV interest.
6. Westgold Resources Limited owns gold mineral rights over the AE interest.
7. AE 85% beneficial interest, Omni Projects Pty Ltd 15% beneficial interest.
8. Sandfire Resources NL - Earn-in Agreement with rights to earn 70% interest.
Auris Minerals Limited I 2018 ANNUAL REPORT
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31 | P a g e
CORPORATE GOVERNANCE STATEMENT
In fulfilling its obligations and responsibilities to its various stakeholders, the Board of Auris Minerals Limited
(Auris) is a strong advocate of corporate governance. The Board has adopted corporate governance policies
and practices consistent with the ASX Corporate Governance Council’s “Corporate Governance Principles and
Recommendations” (Recommendations) where considered appropriate for a company of Auris’s size and
complexity.
The 3rd edition of the ASX Corporate Governance Principles and Recommendations was introduced on 27
March 2014 and took effect for a listed entity’s first full financial year ending on or after 1 July 2014. Accordingly
this Corporate Governance Statement has been prepared on the basis of disclosure under the 3rd edition of
these principles. Details of the Company’s compliance with these principles are summarised in the Appendix
4G announced to ASX in conjunction with the Annual Report.
This statement describes how Auris has addressed the Council’s guidelines and eight corporate governance
principles and where the Company’s corporate governance practices depart from a recommendation, the
Company discloses the reason for adoption of its own practices on an “if not, why not” basis.
Given the size and stage of development of the Company and the cost of strict compliance with all the
recommendations, the Board has adopted a range of modified procedures and practices which it considers
appropriate to enable it to meet the principles of good corporate governance. At the end of this statement is a
checklist setting out the recommendations with which the Company does or does not comply. The information
in this statement is current as at 26 September 2018.
following governance-related documents can be
The
www.aurisminerals.com.au, under the section marked “Corporate Governance Statement”.
found on
the Company’s website at
Charters
(cid:1)
Board
Policies and Procedures
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
Code of Conduct
Policy and Procedure for Selection and (Re)Appointment of Directors
Policy on Assessing the Independence of Directors
Securities Trading Policy
Risk Management Policy
Procedure for the Selection, Appointment and Rotation of External Auditor
Policy on Continuous Disclosure
Shareholder Communication Policy
Diversity Policy
Principle 1 – Lay solid foundations for management and oversight Role and Responsibilities of the
Board and Management
The main function of the Board is to lead and oversee the management and strategic direction of the Company.
The Board regularly measures the performance of Management in implementation of the strategy through
regular Board meetings.
Auris has adopted a formal board charter delineating the roles, responsibilities, practices and expectations of
the Board collectively, the individual directors and Management.
The Board of Auris ensures that each member understands its roles and responsibilities and ensures regular
meetings so as to retain full and effective control of the Company.
Auris Minerals Limited I 2018 ANNUAL REPORT
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32 | P a g e
CORPORATE GOVERNANCE STATEMENT
Role of the Board
The Board responsibilities are as follows:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
Setting the strategic aims of Auris and overseeing Management’s performance within that framework;
Making sure that the necessary resources (financial and human) are available to the Company and
Management to meet its objectives;
Overseeing and measuring Management’s performance of the Company’s strategic plan;
Selecting and appointing a Chief Executive Officer (or equivalent) with the appropriate skills to help the
Company in the pursuit of its objectives;
Controlling and approving financial reporting, capital structures and material contracts;
Ensuring that a sound system of risk management and internal controls is in place;
Setting the Company’s values and standards;
Undertaking a formal and rigorous review of the Corporate Governance policies to ensure adherence
to the ASX Corporate Governance Council principles;
Ensuring that the Company’s obligations to shareholders are understood and met;
Ensuring the health, safety and well-being of employees in conjunction with Management, developing,
overseeing and reviewing the effectiveness of the Company’s occupational health and safety systems
to assure the well-being of all employees;
Ensuring an adequate system is in place for the proper delegation of duties for the effective day to day
running of the Company without the Board losing sight of the direction that the Company is taking;
Establishing a diversity policy and setting objectives for achieving diversity.
Delegation to Management
Other than matters specifically reserved for the Board, responsibility for the operation and administration of the
Company has been delegated to the Chief Executive Officer (or equivalent). This responsibility is subject to an
approved delegation of authority which is reviewed regularly and at least annually.
Internal control processes are designed to allow management to operate within the parameters approved by the
Board and the Chief Executive Officer (or equivalent) cannot commit the Company to additional activities or
obligations in excess of these delegated authorities without specific approval of the Board.
Election of Directors
The Board is responsible for overseeing the selection process of new directors, and will undertake appropriate
checks before appointing a new director, or putting forward a candidate for election as a director. All relevant
information is to be provided in the Notice of Meeting seeking the election or re-election of a director including:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
biographical details including qualifications and experience;
other directorships and material interests;
term of office;
statement by the board on independence of the director;
statement by the board as to whether it supports the election or re-election; and
any other material information.
Auris Minerals Limited I 2018 ANNUAL REPORT
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33 | P a g e
CORPORATE GOVERNANCE STATEMENT
Terms of appointment
Non-Executive Directors
To facilitate a clear understanding of roles and responsibilities all non-executive directors have signed letters of
appointment. This letter of appointment includes acknowledgement of:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
director responsibilities under the Corporations Act, Listing Rules, the Company’s Constitution and other
applicable laws;
corporate governance processes and Company policies;
board and board committee meeting obligations;
conflicts and confidentiality procedures;
securities trading and required disclosures;
access to independent advice and employees;
confidentiality obligations;
directors fees;
expenses reimbursement;
directors and officers insurance arrangements;
other directorships and time commitments; and
board performance review.
Chief Executive Officer (or equivalent)
The Chief Operating Officer has a contract services agreement for an initial term of 3 months and thereafter
extended on a monthly basis by mutual consent.
Role of Company Secretary
The Company Secretary is accountable to the Board for:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
advising the Board and committees on corporate governance matters;
the completion and distribution of board and committee papers;
completion of board and committee minutes; and
the facilitation of director induction processes and ongoing professional development of directors.
All directors have access to the Company Secretary who has a direct reporting line to the Chair.
Diversity
The Board values diversity in all aspects of its business and is committed to creating a working environment that
recognises and utilizes the contribution of its employees. The purpose of this is to provide diversity and equality
relating to all employment matters. The Company’s policy is to recruit and manage on the basis of ability and
qualification for the position and performance, irrespective of gender, age, marital status, sexuality, nationality,
race/cultural background, religious or political opinions, family responsibilities or disability. The company
opposes all forms of unlawful and unfair discrimination.
During the reporting period to 30 June 2018 the Board was represented by three females and for the majority of
the period, the Board comprised three directors, two of whom were female and one was male. As at 30 June
2018, the Board comprised of three directors, one of whom was female and the Board currently comprises four
directors, all of whom are male. The Board has determined that the composition of the current Board represents
the best mix of Directors that have an appropriate range of qualifications and expertise, can understand and
competently deal with current and emerging business issues and can effectively review and challenge the
performance of management.
Auris Minerals Limited I 2018 ANNUAL REPORT
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CORPORATE GOVERNANCE STATEMENT
The Company has disclosed measurable diversity objectives for the current period in the Remuneration Report
included in the Annual Report for the year ended 30 June 2018. The Company is continuing to assess and
proactively monitor gender diversity at all levels of Auris’s business and recognizes that it operates in a very
competitive labour market where positions are sometimes difficult to fill. However, every candidate suitably
qualified for a position has an equal opportunity of appointment regardless of gender, age, ethnicity or cultural
background.
The Company currently has 1 full-time employee who is male and 1 casual employee who is female.
Performance review
Board and board committees
A review of the Board’s performance and effectiveness is conducted annually and the performance of individual
directors is undertaken regularly. The Board has the discretion for these reviews to be conducted either
independently or on a self-assessment basis.
The review focuses on:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
strategic alignment and engagement;
board composition and structure;
processes and practices;
culture and dynamics;
relationship with management; and
personal effectiveness.
A formal review of the Board’s performance and effectiveness in respect of the year ended 30 June 2018 did
not occur.
Chairman and senior executives
Performance evaluation of the Non-Executive Chairman, senior executives and employees is undertaken
annually through a performance appraisal process which involves reviewing and assessment of performance
against agreed corporate and individual key performance indicators and deliverables.
For further information refer to the Remuneration Report included in the Annual Report for the year ended 30
June 2018.
Retirement and rotation of directors
Retirement and rotation of directors are governed by the Corporations Act 2001 and the Constitution of the
Company. Each year, one third of directors must retire and may offer themselves for re-election. Any casual
vacancy filled will be subject to shareholder vote at the next Annual General Meeting of the Company. It is
intended that Mr Hall will stand for re-election at the Company’s 2018 Annual General Meeting as this is the first
annual general meeting since his appointment and Mr Martin will stand for re-election by rotation.
Independent Professional Advice
Each director of the Company or a controlled entity has the right to seek independent professional advice at the
expense of the Company or the controlled entity. However prior approval of the Chairman is required which will
not be unreasonably withheld.
Access to employees
Directors have the right of access to any employee. Any employee shall report any breach of corporate
governance principles or Company policies to the Non-Executive Chairman who shall remedy the breach. If the
breach is not rectified to the satisfaction of the employee, they shall have the right to report any breach to an
independent director without further reference to senior executives of the Company.
Auris Minerals Limited I 2018 ANNUAL REPORT
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35 | P a g e
CORPORATE GOVERNANCE STATEMENT
Directors’ and officers’ liability insurance
Directors’ and officers’ liability insurance is maintained by the Company for the Directors and senior executives
at the Company’s expense.
Board meetings
The frequency of board meetings and the extent of reporting from management at board meetings are as follows:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
a minimum of four scheduled meetings are to be held per year;
other meetings will be held as required;
meetings can be held where practicable by electronic means;
information provided to the Board includes all material information related to the operations of the
Company including exploration, development and production operations, budgets, forecasts, cash
flows, funding requirements, investment and divestment proposals, business development activities,
investor relations,
financial accounts, taxation, external audits, internal controls, risk assessments, people and health,
safety and environmental reports and statistics;
once established, the Chairman of the appropriate board committee will report to the next subsequent
board meeting the outcomes of that meeting and the minutes of those committee meetings are also
tabled.
The number of directors’ meetings (including meetings of committees of directors where applicable) and the
number of meetings attended by each of the directors of the Company during the financial year are set out in
the Directors’ Report included in the Annual Report for the year ended 30 June 2018.
Principle 2 - Structure the Board to add value Composition of the Board
The names of the directors of the Company and their qualifications are set out in the section headed “Information
on Director’s in the Directors’ Report of the financial report for the year ended 30 June 2018.
The composition of the Board has been structured so as to provide Auris with an adequate mix of directors with
industry knowledge, technical, commercial and financial skills together with integrity and judgment considered
necessary to represent shareholders and fulfil the business objectives of the Company.
The ASX Corporate Governance Council guidelines recommend that the Board should constitute of a majority
of independent directors and that the Chairperson should be independent. For the majority of the reporting
period the Board consisted of three directors of whom one was considered independent, being Dr Susan
Vearncombe (Non-Executive Director – appointed 11 August 2017 and resigned on 20 April 2018). Ms Bronwyn
Barnes (Non-Executive Chair – appointed 25 November 2016 and removed 1 August 2018) did not meet the
criteria for an independent director as the nominee for Investmet Limited, a substantial shareholder of the
Company and Mr Robert Martin (Non-Executive Director - appointed 2 November 2016) did not meet the criteria
for an independent director as a substantial shareholder of the Company.
The Board currently consists of Mr Neville Bassett (Independent Non-Executive Chair – appointed 20 April
2018), Mr Robert Martin (Non-Executive Director), Mr Brian Thomas (Independent Non-Executive Director
appointed 20 April 2018) and Mr Craig Hall (Non-Executive Director – appointed 1 August 2018 as nominee for
Investmet Limited, a substantial shareholder of the Company).
The Company does not have a majority of independent directors and the Board considers the current balance
of skills and expertise is appropriate for the Company. The detailed skills matrix of the Board for a company of
Auris’s size and complexity is not considered necessary. The principal business of the Company at present is
as an explorer of its Bryah Basin tenement package, which is prospective for copper and copper-gold
discoveries, therefore requiring a skillset of geological and geophysical expertise, executive management,
financial and commercial skills.
Auris Minerals Limited I 2018 ANNUAL REPORT
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36 | P a g e
CORPORATE GOVERNANCE STATEMENT
The Board comprises directors who each have extensive technical, financial and commercial expertise. The
Board will address the skills matrix commensurate with the growth and development of the Company’s activities
to ensure those skill sets are complemented by additional industry expertise in the sector pursued as required.
Nomination of other Board Members
Membership of the Board of Directors is reviewed on an on-going basis by the Chairperson of the Board to
determine if additional core strengths are required to be added to the Board in light of the nature of the
Company’s businesses and its objectives. The Board does not have a separate Nomination Committee and
does not believe it is necessary in a Company of Auris’s size.
Director induction and ongoing professional development
The Company does not have a formal induction program for Directors but does provide Directors with information
pack detailing policies, corporate governance and various other corporate requirements of being a director of
an ASX Listed company. Due to the size and nature of the business, Directors are expected to already possess
a level of both industry and commercial expertise before being considered for a directorship of the Company.
Directors are provided with the opportunity to access employees of the business and any information as they
require about the business including being given access to regular news articles and publications where
considered relevant.
Principle 3 - Promote ethical and responsible decision-making Code of Conduct
Directors, officers, employees and consultants to the Company are required to observe high standards of
behaviour and business ethics in conducting business on behalf of the Company and they are required to
maintain a reputation of integrity on the part of both the Company and themselves. The Company does not
contract with or otherwise engage any person or party where it considers integrity may be compromised.
Conflicts of Interest
Directors are required to disclose to the Board actual or potential conflicts of interest that may or might
reasonably be thought to exist between the interests of the director or the interests of any other party in so far
as it affects the activities of the Company and to act in accordance with the Corporations Act if conflict cannot
be removed or if it persists. That involves taking no part in the decision making process or discussions where
that conflict does arise.
Trading in Company Securities
Directors are required to make disclosure of any share trading. The Company policy in relation to share trading
is that officers are prohibited to trade whilst in possession of unpublished price sensitive information concerning
the Company or within a period of the release of results i.e. the blackout period. That is information which a
reasonable person would expect to have a material effect on the price or value of the Company’s shares. An
officer must receive authority to acquire or sell shares with the directors or the Company Secretary prior to doing
so to ensure that there is no price sensitive information of which that officer might not be aware. The undertaking
of any trading in shares must be notified to the ASX.
Principle 4 - Safeguard integrity in financial reporting
Auris has a financial reporting process which includes half year and full-year results which are signed off by the
Board before they are released to the market.
The Board does not have a separate Audit Committee and does not believe it is necessary in a Company of
Auris’s size. Instead, the three Board members, who each have extensive commercial and financial expertise,
manage the financial oversight as well as advise on the modification and maintenance of the Company's financial
reporting, internal control structure, external audit functions, and appropriate ethical standards for the
management of the Company.
In discharging its oversight role, the Board is empowered to investigate any matter brought to its attention with
full access to all books, records, facilities, and personnel of the Company and the authority to engage
independent counsel and other advisers as it determines necessary to carry out its duties.
Auris Minerals Limited I 2018 ANNUAL REPORT
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CORPORATE GOVERNANCE STATEMENT
The Chief Executive Officer (or equivalent) reports in writing on the propriety of compliance on internal controls
and reporting systems and ensures that they are working efficiently and effectively in all material respects.
The Company has established procedures for the selection, appointment and rotation of its external auditor. The
Board is responsible for the initial appointment of the external auditor and the appointment of a new external
auditor when any vacancy arises, as recommended by the Board. Candidates for the position of external auditor
must demonstrate complete independence from the Company through the engagement period. The Board may
otherwise select an external auditor based on criteria relevant to the Company’s business and circumstances.
The performance of the external auditor is reviewed on an annual basis by the Board.
The Company’s external auditor attends each Annual General meeting and is available to answer questions
from shareholders relevant to the conduct of the external audit, the preparation and content of the Auditor’s
Report, the accounting policies adopted by the Company and the independence of the auditor.
Principle 5 - Make timely and balanced disclosure
Auris has adopted a formal policy dealing with its disclosure responsibilities. The Board has designated the
Company Secretary as the person responsible for overseeing and coordinating disclosure of information to the
ASX as well as communicating with the ASX. In accordance with the ASX Listing Rules the Company
immediately notifies the ASX of information:
(cid:1)
(cid:1)
concerning the Company that a reasonable person would expect to have a material effect on the price
or value of the Company’s securities; and
that would, or would be likely to, influence persons who commonly invest in securities in deciding
whether to acquire or dispose of the Company’s securities.
The policy also addresses the Company’s obligations to prevent the creation of a false market in its securities.
Auris ensures that all information necessary for investors to make an informed decision is available on its
website.
The Non-Executive Chairman has ultimate authority and responsibility for approving market disclosure which,
in practice, is exercised in consultation with the Board and Company Secretary.
In addition, the Board will also consider whether there are any matters requiring continuous disclosure in respect
of each and every item of business that it considers.
Principle 6 - Respect the rights of shareholders
The Board’s fundamental responsibility to shareholders is to work towards meeting the Company’s objectives
so as to add value for them. The Board maintains an investor relation program which will inform shareholders
of all major developments affecting the Company by:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
preparing half yearly and yearly financial reports;
preparing quarterly cash flow reports and reports as to activities;
making announcement in accordance with the listing rules and the continuous disclosure obligations;
posting all of the above on the Company’s website;
annually, and more regularly if required, holding a general meeting of shareholders and forwarding to
them the annual report, if requested, together with notice of meeting and proxy form; and
voluntarily releasing other information which it believes is in the interest of shareholders.
The Annual General Meeting enables shareholders to discuss the annual report and participate in the meetings
either by attendance or by written communication. The Company provides all shareholders with a Notice of
Meeting so they can be fully informed and be able to vote on all resolutions at the Annual General Meeting.
Shareholders are able to discuss any matter with the directors and/or the auditor of the Company who is also
invited to attend the Annual General Meeting.
Auris Minerals Limited I 2018 ANNUAL REPORT
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38 | P a g e
CORPORATE GOVERNANCE STATEMENT
Shareholders have the option to receive all Company and share registry communications electronically, and
may also communicate with the Company by emailing the Company via its website. All shareholders have the
ability to request copies of ASX releases, all of which are published and available on the Company’s website
immediately after they are released to ASX.
The Company regularly reviews its stakeholder communication policy and endeavours to maintain a program
appropriate for a company of its size and complexity.
Principle 7 - Recognise and Manage Risk
The Board has adopted a Risk Management Policy, which sets out the Company’s risk profile. Under the policy,
the Board is responsible for approving the Company’s policies on risk oversight and management and satisfying
itself that management has developed and implemented a sound system of risk management and internal
control.
Under the policy, the Board delegate’s day-to-day management of risk to the Chief Executive Officer or
equivalent, who is responsible for identifying, assessing, monitoring and managing risks. The Chief Executive
Officer or equivalent is also responsible for updating the Company’s material business risks to reflect any
material changes, with the approval of the Board.
In fulfilling the duties of risk management, the Chief Executive Officer or equivalent may have unrestricted
access to Company employees, contractors and records and may obtain independent expert advice on any
matter they believe appropriate, with the prior approval of the Board.
The Board does not have a separate Risk Management Committee as the Board monitors and reviews the
integrity of financial reporting and the Company’s internal financial control systems. Management assess the
effectiveness of the internal financial control on an annual basis and table concerns and recommendations at
Board meetings were required.
In addition, the following risk management measures have been adopted by the Board to manage the
Company’s material business risks:
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
Establishment of financial control procedures and authority limits for management;
Approval of an annual budget;
Adoption of a compliance procedure for the purpose of ensuring compliance with the Company’s
continuous disclosure obligations; and
Adoption of a corporate governance manual which contains other policies to assist the Company to
establish and maintain its governance practices.
Maintenance and review of a risk register to identify the Company’s material business risks and risk
management strategies for these risks. The risk register is reviewed half yearly and updated as required.
Management reports to the Board on material business risks at each Board meeting.
The Board has required management to design, implement and maintain risk management and internal control
systems to manage the material business risks of the Company. The Board also requires management to report
to it confirming that those risks are being managed effectively. The Board has received a report from
management as to the effectiveness of the Company’s management of its material business risks for the
financial year ended 30 June 2018.
The Chief Executive Officer (or equivalent) and the Chief Financial Officer (or equivalent) have provided a
declaration to the Board in accordance with section 295A of the Corporations Act and has assured the Board
that such declaration is founded on a sound system of risk management and internal control and that the system
is operating effectively in all material respects in relation to financial risks.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
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CORPORATE GOVERNANCE STATEMENT
Internal Audit
The Company does not have an internal audit function as the Board believes the business is neither the size
nor complexity that requires such a function. The Board is currently responsible for monitoring the effectiveness
of internal controls, risk management procedures and governance.
Sustainability Risks
The Company has a detailed risk matrix which it regularly reviews and which highlights critical risk factors the
Company faces at any particular time. The principal risks highlighted are what would typically be expected for a
small listed exploration company and include;
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
Reliance on key executives
Inability to access new exploration capital
Unsuccessful exploration results
Exposure to other operators, be it through Joint Venture agreements or actions of those operators in an
operational sense
Legislature changes in jurisdiction the Company operates in
As the Company expands its activities either within existing projects or with the addition of new projects, it is
expected that the sustainability risks will change accordingly. The Board reviews the overall sustainability of
both the copper-gold exploration business and more specifically, the Company, in its normal course of business
and therefore does not produce a separate sustainability report.
Principle 8 - Remunerate fairly and responsibly
The Company does not have a Remuneration Committee. Instead, the Board monitors and reviews the
remuneration policy of the Company. The Board will engage an independent remuneration consultant to review
the Company’s policy on remuneration as and when required.
Details of the remuneration policy are contained in the Remuneration Report included in the Directors’ Report.
The Company’s policy is to remunerate non-executive directors at a fixed fee for time, commitment and
responsibilities. Remuneration for non-executive directors is not linked to individual performance. From time-to-
time the Company may grant options to non-executive directors. The grant of options is designed to recognise
and reward efforts as well as to provide non-executive directors with additional incentive to continue those efforts
for the benefit of the Company.
The maximum aggregate amount of fees (including superannuation payments) that can be paid to non-executive
directors is subject to approval by the shareholders at general meeting.
Pay and rewards for executive directors and senior executives consists of a base salary and performance
incentives. Long term performance incentives may include options and / or performance rights granted at the
discretion of the Remuneration Committee and subject to obtaining the relevant approvals. The grant of options
and / or performance rights is designed to recognise and reward efforts as well as to provide additional incentive
and may be subject to the successful completion of performance hurdles. Executives are offered a competitive
level of base pay at market rates (for comparable companies) and are reviewed annually to ensure market
competitiveness. The Company’s policy is not to allow transactions in associated products which limit the risk
of participating in unvested elements of equity-based compensation plans.
There are no termination or retirement benefits for non-executive directors (other than superannuation).
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
40 | P a g e
ADDITIONAL SHAREHOLDER INFORMATION
Shareholder Information
The shareholder information set out below was applicable at 20 September 2018.
A.
Distribution of Equity Securities
i)
Analysis of numbers of shareholders by size of holding:
Ordinary Shares (AUR)
No. of
shareholders
Percentage of issued
capital
125
103
176
676
327
1,407
0.01%
0.07%
0.35%
6.71%
92.86%
100%
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
Over 100,000
Total
ii)
360 holdings of a less than marketable parcel at $0.05 per share.
B.
Equity Security Holders
Twenty largest quoted equity security holders
The names of the 20 largest holders of quoted equity securities are listed below:
Investmet Ltd
JP Morgan Nom Aust Ltd
HSBC Custody Nom Aust Ltd
Martin, R P & S P
Investmet Ltd
Citicorp Nom Pty Ltd
Hades Corp WA Pty Ltd
Motte & Bailey Pty Ltd
All-States Finance Pty Ltd
Guina Global Inv Pty Ltd
Pershing Aust Nom Pty Ltd
Perth Select Seafoods Pty Ltd
Bayferry Pty Ltd
BNP Paribas Nom Pty Ltd
Onmell Pty Ltd
Gleneagle Sec Nom Pty Ltd
Botsis Holdings Pty Ltd
Southern Cross Cap Pty Ltd
Goldfire Enterprise Pty Ltd
Riverview Corp Pty Ltd
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
No. of ordinary
shares held
40,959,103
Percentage of
issued shares
10.02%
35,894,827
27,038,665
22,147,280
18,954,491
14,195,531
14,175,000
12,693,419
12,247,830
5,200,000
5,100,000
5,000,000
4,800,000
4,631,148
3,551,912
3,533,395
3,500,000
3,500,000
3,217,392
3,215,083
8.78%
6.62%
5.42%
4.64%
3.47%
3.47%
3.11%
3.00%
1.27%
1.25%
1.22%
1.17%
1.13%
0.87%
0.86%
0.86%
0.86%
0.79%
0.79%
243,555,076
59.60%
41 | P a g e
ADDITIONAL SHAREHOLDER INFORMATION
Unquoted equity securities
1,480,000 unlisted $0.60 options held by seventeen (17) option holders, expiring 3 October 2018
2,500,000 unlisted $1.30 options held by eighteen (18) option holders, expiring 8 October 2019
6,000,000 performance rights held by two (2) holders, expiring 22 November 2020
C.
Substantial Holders
As at 26 September 2018, the Company had received substantial shareholder notices from the following
shareholders:
Shareholder
No. of shares
Percentage of issue
Michael George Fotios
Goldfire Enterprises Pty Ltd
SG Hiscock & Company Limited
74,438,594
28,651,486
20,493,391
18.26%
7.03%
5.03%
Note:
i)
The above details may not reconcile to the information in the Twenty Largest Security Holders list as
revised substantial shareholder notices had not been received by the Company as at 26 September
2018.
D.
Voting Rights
At a general meeting of shareholders:
(a) On a show of hands, each person who is a member or sole proxy has one vote.
(b) On a poll, each shareholder is entitled to one vote for each fully paid share.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
42 | P a g e
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2018
Finance income
Grant income
Administrative expenses
Finance costs
Release from right of first refusal
Share based payments expense
Write off exploration assets
Loss before income tax
Income tax benefit
(Loss) from continuing operations
Note
3
3
3
19
10
4
30 Jun 2018
30 Jun 2017
$
62,210
53,857
(1,154,494)
(5,652)
-
(616,000)
(364,813)
$
25,093
-
(1,220,231)
(11,920)
(92,885)
(142,566)
(254,115)
(2,024,892)
(1,696,624)
707,856
811,914
(1,317,036)
(884,710)
Other comprehensive income for the period, net of tax
-
-
Total comprehensive income for the period
(1,317,036)
(884,710)
Loss per share
Basic loss per share attributable to ordinary equity holders
5
(0.33)
(0.30)
The consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with
the accompanying notes.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
44 | P a g e
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2018
ASSETS
Cash and cash equivalents
Trade and other receivables
Financial assets
Total current assets
Property, plant and equipment
Exploration assets
Total non-current assets
TOTAL ASSETS
LIABILITIES
Trade and other payables
Borrowings
Provisions
Total current liabilities
Provisions
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
30 Jun 2018
30 Jun 2017
Note
$
$
11
7
8
9
10
12
13
14
14
3,178,861
31,532
1,200,000
4,410,393
188,613
16,883,568
3,223,776
49,371
-
3,273,147
237,959
14,975,557
17,072,181
15,213,516
21,482,574
18,486,663
263,797
40,000
134,778
438,575
129,880
129,880
568,455
484,333
40,000
180,969
705,302
129,880
129,880
835,182
20,914,119
17,651,481
15
15
123,829,985
1,241,125
(104,156,991)
119,866,311
2,317,493
(104,532,323)
20,914,119
17,651,481
The consolidated statement of financial position is to be read in conjunction with the accompanying notes.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
45 | P a g e
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2018
Issued capital
Accumulated
losses
Share based
payments
reserve
Total equity
Note
$
$
$
$
113,847,669
(106,337,493)
4,864,807
12,374,983
-
-
(884,710)
(884,710)
-
-
(884,710)
(884,710)
15
15
15
15
6,327,725
(309,083)
-
-
-
-
-
2,689,880
-
-
142,566
(2,689,880)
6,327,725
(309,083)
142,566
-
Opening balance at 1 July
2016
Comprehensive income
Loss for the period
Total comprehensive income for
the period
Transactions with owners and
other transfers
Shares issued
Share issue costs
Share based payments
Expiry of options
Balance as at 30 June 2017
119,866,311
(104,532,323)
2,317,493
17,651,481
Opening balance at 1 July
2017
Comprehensive income
Loss for the period
Total comprehensive income for
the period
Transactions with owners and
other transfers
Shares issued
Share issue costs
Share based payments
Expiry of options
119,866,311
(104,532,323)
2,317,493
17,651,481
-
-
(1,317,036)
(1,317,036)
-
-
(1,317,036)
(1,317,036)
15
15
15
15
4,127,925
(164,251)
-
-
-
-
-
1,692,368
-
-
616,000
(1,692,368)
4,127,925
(164,251)
616,000
-
Balance as at 30 June 2018
123,829,985
(104,156,991)
1,241,125
20,914,119
The consolidated statement of changes in equity is to be read in conjunction with the accompanying notes.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
46 | P a g e
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2018
Cash flows from operating activities
Cash receipts from customers
Cash paid to suppliers and employees
Research and development tax benefit
Interest received
Note
2018
$
2017
$
53,857
(1,153,138)
707,856
66,473
-
(1,092,618)
811,914
20,830
Net cash outflow from operating activities
11(a)
(324,952)
(259,874)
Cash flows from investing activities
Payments for exploration and evaluation
Proceeds on disposal of property, plant and equipment
Payments for property, plant and equipment
Net cash outflow from investing activities
Cash flows from financing activities
Proceeds from issue of shares
(Return)/receipt of shareholder funds in trust
Share issue costs
Net cash inflow from financing activities
15
15
Net (decrease) / increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents at the end of the period
11
(3,263,364)
153
(1,020)
(4,063,438)
71,225
(81,721)
(3,264,231)
(4,073,934)
3,727,925
(19,406)
(164,251)
3,544,268
(44,915)
3,223,776
3,178,861
5,657,155
43,614
(309,083)
5,391,686
1,057,878
2,165,898
3,223,776
The consolidated statement of cash flows is to be read in conjunction with the accompanying notes.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
47 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
1.
Reporting entity
Auris Minerals Limited (the Company or Auris Minerals) is a company domiciled in Australia. The address of the
Company’s registered office and principal place of business is Level 1, 18 Richardson Street, West Perth WA
6005. The Company is primarily involved in the exploration of mineral tenements in Western Australia. The
consolidated financial statements of the Company as at and for the year ended 30 June 2018 comprised the
Company and its wholly owned subsidiaries (together referred to as the “Group”).
Statement of compliance
a)
Statement of compliance
The financial report is a general purpose financial report which has been prepared in accordance with Australian
Accounting Standards (AASBs) (including Australian interpretations) adopted by the Australian Accounting
Standard Board (AASB) and the Corporations Act 2001. The financial report of the Group complies with the
International Financial Reporting Standards (IFRSs) and interpretations adopted by the International Accounting
Standards Board (IASB).
The financial statements were authorised for issue by the Board of Directors on 26th September 2018.
b)
Basis of measurement
The financial statements have been prepared on the historical cost basis except for share based payments
which are measured at fair value. The methods used to determine fair values are discussed further note 2 (m)
under share based payment transaction.
Going Concern
This report has been prepared on the going concern basis, which contemplates the continuation of normal
business activity and the realisation of assets and the settlement of liabilities in the normal course of business.
The directors recognise that the ability of the Group to continue as a going concern and to pay its debts as and
when they fall due is dependent on the ability of the Group to secure additional funding through either the issue
of further shares and / or options.
The directors have reviewed the business outlook and are of the opinion that the use of the going concern basis
of accounting is appropriate as they believe the Group will achieve the matters set out above. As such, the
directors believe that they will continue to be successful in securing additional funds as and when the need to
raise working capital arises.
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 from those stated
in the financial report.
The financial report does not include any adjustments relating to the recoverability and classification of recorded
asset amounts nor to the amounts and classification of liabilities that may be necessary should the Group be
unable to continue as a going concern.
c)
Functional and presentation currency
These financial statements are presented in Australian dollars, which is the Group’s functional currency.
d)
Use of estimates and judgements
The preparation of financial statements requires management to make judgements, estimates and assumptions
that affect the application of accounting policies and reported amounts of assets, liabilities, income and
expenses. 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.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
48 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
2.
Significant accounting policies
The accounting policies set out below have been applied consistently to all periods presented in these financial
statements, and have been applied consistently by the Group.
Certain comparative amounts have been reclassified to conform to the current year’s presentation where
required.
a)
Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Company. Control exists when the Company has the power, directly
or indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
In assessing control, potential voting rights that currently are exercisable or convertible are taken into account.
The financial statements of subsidiaries are included in the consolidated financial statements from the date that
control commences until the date that control ceases. The accounting policies of subsidiaries have been
changed when necessary to align them with the policies adopted by the Company.
In the Company’s financial statements, investments in subsidiaries are carried at cost.
Minority interests in the results and equity of subsidiaries are shown separately in the consolidated statement of
profit and loss and other comprehensive income and statement of financial position respectively.
Transactions eliminated on consolidation
Intra-group transactions, balances and any unrealised income and expenses arising from transactions, are
eliminated in preparing the consolidated financial statements.
b)
Financial instruments
Non-derivative financial assets
The Group initially recognises receivables and deposits on the date that they are originated. All other financial
assets (including assets designated at fair value through the statement of profit and loss and other
comprehensive income) are recognised initially on the trade date at which the Group becomes party to the
contractual provisions of the instrument.
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire,
or it transfers the rights to receive the contractual cash flows on the financial asset in a transaction in which
substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in
transferred financial assets that is created or retained by the Group is recognised as a separate asset or liability.
Financial assets and liabilities are offset and the net amount presented in the statement of financial position
when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net
basis or to realise the asset and settle the liability simultaneously.
The Group has the following non-derivative financial assets: cash and cash equivalents, trade and other
receivables.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on
demand and form an integral part of the Group’s cash management are included as a component of cash and
cash equivalents for the purpose of the statement of cash flows. The Group does not recognise funds held in
trust, in relation to equity issues, as a component of cash and cash equivalents.
Accounting for finance income and finance cost is discussed in Note 2(i).
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
49 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
2.
Significant accounting policies (continued)
Receivables
Receivables are financial assets with fixed or determinable payments that are not quoted in an active market.
Such assets are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to
initial recognition receivables are measured at amortised cost using the effective interest method, less any
impairment losses.
Non-derivative financial liabilities
Financial liabilities are recognised initially on the trade date at which the Group becomes a party to the
contractual provisions of the instrument. The Group derecognises a financial liability when its contractual
obligations are discharged or cancelled or expire. Financial assets and liabilities are offset and the net amount
presented in the statement of financial position when, and only when, the Group has a legal right to offset the
amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.
The Group has the following non-derivative financial liabilities: trade and other payables, borrowings and
provisions.
Such financial liabilities are recognised initially at fair value plus any directly attributable transaction costs.
Subsequent to initial recognition trade and other payables are measured at cost, which approximates fair value,
borrowings are measured at amortised cost using the effective interest rate method, and provisions are
measured as outlined in Note 2(h).
c)
Issued capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares
and share options are recognised as a deduction from equity, net of any tax effects. Dividends on ordinary
shares are recognised as a liability in the period in which they are declared.
d)
Property, plant and equipment
Recognition and measurement
Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated
impairment losses.
Cost includes expenditure that is directly attributable to the acquisition of the asset. When parts of an item of
property, plant and equipment have different useful lives, they are accounted for as separate items (major
components) of property, plant and equipment.
Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the
proceeds from disposal with the carrying amount of property, plant and equipment and are recognised net within
“other income” in the statement of profit and loss and other comprehensive income.
Subsequent costs
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of
an item if it is probable that the future economic benefits embodied within the item will flow to the Group and the
cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other
costs are recognised in the income statement as an expense incurred.
Depreciation
Depreciation is recognised in the income statement on a diminishing value basis over the estimated useful lives
of each part of an item of property, plant and equipment. The estimated useful lives in the current and
comparative periods are as follows:
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
50 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
2.
Significant accounting policies (continued)
Office equipment
20%
Plant and equipment
40%
Motor vehicles
20%
Depreciation methods, useful lives and residual values are reviewed at each reporting date.
e)
Exploration expenditure
Exploration activity involves the search for mineral resources, the determination of technical feasibility and the
assessment of commercial viability of an identified resource. Exploration expenditure incurred is accumulated
in respect of each identifiable area of interest. Exploration expenditure is measured at cost.
Exploration expenditure related to each identifiable area of interest are recognised as an exploration assets in
the year in which they are incurred and carried forward to the extent that the following conditions are satisfied:
(i)
rights to tenure of the identifiable area of interest are current; and
(ii)
at least one of the following conditions is also met:
(cid:1)
(cid:1)
the expenditure is expected to be recouped through the successful development of the identifiable
are of interest, or alternatively, by its sale; or
where activities in the identifiable area of interest have not at the reporting date reached a stage
that permits a reasonable assessment of the existence or otherwise of economically recoverable
reserves and activities in, or in relation to, the area of interest.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest. Accumulated costs in relation to an abandoned area are written
off in full in the statement of profit and loss and other comprehensive income in the year in which the decision
to abandon the area is made.
Exploration assets are reviewed at each reporting date for indicators of impairment and tested for impairment
where such indicators exist. If the test indicates that the carrying value might not be recoverable the asset is
written down to its recoverable amount. Any such impairment arising is recognised in the statement of profit and
loss and other comprehensive income for the year.
Where an impairment loss is subsequently reversed, the carrying amount of the asset is increased to the revised
estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed
the carrying amount that would have been determined had no impairment loss been recognised for the asset in
previous years.
f)
Impairment
Financial assets (including receivables)
A financial asset not carried at fair value through the statement of profit and loss and other comprehensive
income is assessed at each reporting date to determine whether there is objective evidence that it is impaired.
A financial asset is considered to be impaired if objective evidence indicates that a loss event has occurred after
the initial recognition of the asset, and that the loss event had a negative effect on the estimated future cash
flows of that asset that can be estimated reliably.
Objective evidence that financial assets are impaired can include default or delinquency by a debtor,
restructuring of an amount due to the Group on terms that the Group would not consider otherwise, indications
that a debtor or issuer will enter bankruptcy, and the disappearance of an active market for a security.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
51 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
2.
Significant accounting policies (continued)
The Group considers evidence of impairment for receivables at both a specific asset and collective level. All
individually significant receivables are assessed for specific impairment. All individually significant receivables
found not to be specifically impaired are then collectively assessed for any impairment that has been incurred
but not yet identified. Receivables that are not individually significant are collectively assessed in groups that
show similar credit risk characteristics.
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 asset’s
original interest rate. Losses are recognised in the statement of profit and loss and other comprehensive income
and reflected in an allowance account against receivables. Interest on the impaired asset continues to be
recognised through the unwinding of the discount. When a subsequent event causes the amount of impairment
loss to decrease, the decrease in impairment loss is reversed through the statement of profit and loss and other
comprehensive income.
Non-financial assets
The carrying amounts of the Group’s non-financial assets are reviewed at each reporting date to determine
whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount
is estimated.
The recoverable amount of an asset or cash-generating unit is the greater of its fair value in use and its fair
value less costs to sell. 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 the purposes of impairment testing, assets that cannot be tested individually are grouped together into the
smallest group of assets that generates cash inflows from continuing use that are largely independent of the
cash inflows of other assets or groups of assets (the “cash-generating unit”). 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.
The Group’s corporate assets do not generate separate cash inflows. If there is an indication that a corporate
asset may be impaired, then the recoverable amount is determined for the CGU to which the corporate asset
belongs.
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its
estimated recoverable amount. Impairment losses are recognised in the statement of profit and loss and other
comprehensive income. Impairment losses recognised in respect of CGUs are allocated to reduce the carrying
amounts of other assets in the unit (group of units) on a pro rata basis.
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.
g)
Employee benefits
Defined contribution superannuation funds
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into
a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for
contributions to defined contribution plans are recognised as an employee benefit expense in the statement of
profit and loss and other comprehensive income in the periods during which services are rendered by
employees. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in
future payments is available.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
52 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
2.
Significant accounting policies (continued)
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
reporting date and are calculated at undiscounted amounts based on remuneration wage and salary rates that
the Group expects to pay as at reporting date including related on-costs, such as workers compensation
insurance and payroll tax.
h)
Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation
that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle
the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that
reflects current market assessments of the time value of money and the risks specific to the liability. The
unwinding of the discount is recognised as finance cost.
Exploration activities give rise to obligations for site closure and rehabilitation. Site restoration costs include the
dismantling and removal of mining plant, equipment and building structures, waste removal and rehabilitation of
the site in accordance with clauses of the mining permits. Such costs have been determined using estimates of
future costs, current legal requirements and technology discounted to their present values.
i)
Revenue
Services
Revenue from services rendered is recognised in the statement of profit and loss and other comprehensive
income in proportion to the stage of completion of the transaction at the reporting date.
Finance income and finance costs
Finance income comprises interest income on funds invested. Interest income is recognised as it accrues in the
statement of profit and loss and other comprehensive income, using the effective interest method.
Finance costs comprise interest expense on borrowings, unwinding of the discount on provisions and impairment
losses recognised on financial assets.
j)
Income tax
Income tax expense comprises current and deferred tax. Current and deferred tax are recognised in the
statement of profit and loss and other comprehensive income except to the extent that it relates to a business
combination, or items recognised directly in equity or in other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates
enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous
years.
Deferred tax is recognised using the balance sheet method, providing for temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation
purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of assets
and liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable
profit or loss, and differences relating to investments in subsidiaries to the extent that it is probable that they will
not reverse in the foreseeable future.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
53 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
2.
Significant accounting policies (continued)
Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when
they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred
tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets,
and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax
entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities
will be realised simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to
the extent that it is probable that future taxable profits will be available against which the asset can be utilised.
Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer
probable that the related tax benefit will be realised.
k)
Goods and services tax
Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST), except
where the amount of GST incurred is not recoverable from the taxation authority. In these circumstances, the
GST is recognised as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable
from, or payable to, the Australian Taxation Office is included as a current asset or liability in the balance sheet.
Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows
arising from investing and financing activities which are recoverable from, or payable to, the Australian Taxation
Office are classified as operating cash flows.
l)
Loss per share
The Company presents basic and diluted loss per share for its ordinary shares. Basic loss per share is calculated
by dividing the profit or loss attributable to the ordinary shareholders of the Company by the weighted average
number of ordinary shares outstanding during the period. Diluted earnings per share is only determined if the
Company is in a profit position. Refer to note 5 for details.
m)
Accounting estimates and judgements
Management discusses with the Board the development, selection and disclosure of the Group’s critical
accounting policies and estimates and the application of these policies and estimates. The estimates and
judgements that have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below.
Taxation
Balances disclosed in the financial statements and the notes related to taxation, are based on the best estimates
of directors and take into account the financial performance and position of the Group as they pertain to current
income tax legislation, and the directors understanding thereof. No adjustment has been made for pending or
future taxation legislation. The current tax position represents the best estimate, pending assessment by the
Australian Tax Office.
Exploration assets
The accounting policy for exploration expenditure results in expenditure being capitalised for an area of interest
where it is considered likely to be recoverable by future exploitation or sale or where the activities have not
reached a stage which permits a reasonable assessment of the existence of reserves.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
54 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
2.
Significant accounting policies (continued)
This policy requires management to make certain estimates as to future events and circumstances, in particular
whether an economically viable extraction operation can be established. Any such estimates and assumptions
may change as new information becomes available. If, after having capitalised the expenditure under the policy,
a judgement is made that the recovery of the expenditure is unlikely, the relevant capitalised amount will be
written off to profit and loss.
Share-based payment transactions
The Group measures the cost of equity-settled transactions by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value of rights granted is measured using the single
barrier share option pricing model, taking into account the terms and conditions set out within note 19.
Estimated useful lives of assets
Estimated useful lives of assets have been based on historical experience. The condition of the assets is
assessed at least once per year and considered against the remaining life. Adjustments to useful lives are made
when considered necessary.
Provision for rehabilitation
Included in liabilities at the end of each reporting period is an amount that represents an estimate of the cost to
rehabilitate the land upon which the Group has carried out its exploration for mineral resources. Provisions are
measured at the present value of management's best estimate of the costs required to settle the obligation at
the end of the reporting period. Actual costs incurred in future periods to settle these obligations could differ
materially from these estimates. Additionally, future changes to environmental laws and regulations, life of mine
estimates, and discount rates could affect the carrying amount of this provision.
Impairment
The Group assesses impairment at the end of each reporting period by evaluating conditions or events specific
to the Group that may be indicative of impairment indicators. The decision as to the existence of impairment
indicators requires judgement.
n)
New standards and interpretations not yet adopted
There are a number of new Accounting standards and Interpretations issued by the AASB that are not yet
mandatorily applicable to the Group. They are available for early adoption at 30 June 2018, but have not been
applied in preparing this financial report because the adoption would not materially impact this financial report.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
55 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
3.
Revenue and expenses includes:
Finance costs
Costs in relation to convertible notes:
Interest
Foreign exchange loss
Note
2018
$
4,883
769
5,652
2017
$
11,920
-
11,920
Release from right of first refusal
Issue of 1,429,000 shares to Westgold Limited
11(b)(ii)
-
92,885
Administrative expenses
Disclosable
Employee benefits expense
Office lease payments
Depreciation
Legal services
Company secretarial services
Other
8
436,261
40,193
49,990
128,554
60,000
439,496
567,002
51,333
60,485
108,545
60,000
372,866
1,154,494
1,220,231
4.
a)
Income tax expense
Numerical reconciliation between tax expense / (benefit) and pre-tax net loss
Loss before tax
Income tax benefit using the domestic corporation tax rate of 27.5%
(2017: 27.5%)
Increase / (decrease) in income tax due to:
Non-deductible expenses
Temporary differences and losses not recognised
Adjustments in respect of previous current income tax
Tax amortisation of capital raising costs
Income tax benefit
b)
Tax consolidation
2018
2017
$
(2,024,892)
$
(1,696,624)
(556,845)
(466,572)
169,786
484,473
(707,856)
(97,414)
66,034
497,508
(811,914)
(96,970)
(707,856)
(811,914)
The company and its 100% owned controlled entities have formed a tax consolidated group. Members of the
Consolidated Entity have entered into a tax sharing arrangement in order to allocate income tax expense to the
wholly owned controlled entities on a pro-rate basis. The agreement provides for the allocation of income tax
liabilities between the entities should the head entity default on its tax payment obligations. At balance date, the
possibility of default is remote. The head entity of the tax consolidated group is Auris Minerals Limited.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
56 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
4.
c)
Income tax expense (continued)
Tax effect accounting by members of the tax consolidated group
Members of the tax consolidated group have entered into a tax funding agreement. The tax funding agreement
provides for the allocation of current taxes to members of the tax consolidated group. Deferred taxes are
allocated to members of the tax consolidated group in accordance with a group allocation approach which is
consistent with the principles of AASB 112 Income Taxes. The allocation of taxes under the tax funding
agreement is recognised as an increase/decrease in the controlled entities intercompany accounts with the tax
consolidated group head company, Auris Minerals Limited.
In this regard the Company has utilised the benefit of tax losses from controlled entities of $1,818,520 (2017:
$1,751,535) as of the balance date. The nature of the tax funding agreement is such that no tax consolidation
contributions by or distributions to equity participants are required.
d)
Deferred tax (liabilities) / assets not recognised
Exploration expenditure
Receivables
Plant and equipment
Investments
Environmental liability
Provisions and sundry items
Business related costs
Capital losses
Tax losses
Deferred tax asset not recognised
Net deferred tax liability
2018
2017
$
(4,431,402)
-
12,431
29,493
35,717
42,899
200,897
243,664
26,492,262
(22,625,961)
$
(4,118,278)
(1,172)
(16)
29,493
35,717
53,617
268,132
243,664
24,488,070
(20,999,227)
-
-
The tax losses do not expire under current legislation. Deferred tax assets have not been recognised in respect
of these items because it is not probable that future taxable profit will be available against which the Company
can utilise the benefits.
5.
Loss per share
Basic loss per share (cents)
2018
Cents
0.33
2017
Cents
0.30
The calculation of basic loss per share at 30 June 2018 is based on the loss attributable to ordinary shareholders
of $1,317,036 (2017: $884,710) and a weighted average number of ordinary shares outstanding of 396,088,820
(2017: 291,625,860).
The number ordinary shares has been restated on a post consolidation basis.
As at 30 June 2018, the options detailed within note 19 are considered to be potential ordinary shares. However,
as the Group is in a loss position, the potential ordinary shares are considered to be anti-dilutive in nature, as
their exercise will not result in a diluted loss per share that shows an inferior view of earnings performance of
the Group than is shown by basic loss per share. For this reason, the options have not been included in the
determination of diluted loss per share and the diluted loss per share is disclosed to be the same as basic loss
per share.
57 | P a g e
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
6.
Auditors remuneration
Audit services:
Audit and review of financial reports
7.
Trade and other receivables
Receivable from Australian Taxation Office
Other
2018
$
29,000
29,000
2018
$
22,960
8,572
31,532
2017
$
28,000
28,000
2017
$
36,811
12,560
49,371
The Group’s exposure to credit and currency risks and impairment losses related to trade and other receivables
are disclosed in note 20.
8.
Financial Assets
Available-for-sale financial assets
Balance at 1 July
Acquisition of listed investments
Balance at 30 June
Note
(i)
2018
2017
$
-
1,200,000
1,200,000
$
-
-
-
(i)
Available-for-sale financial assets consists of investments in ordinary shares and, therefore, have no fixed maturity date or
coupon rate.
On 7 March 2018, Sandfire Resources NL (ASX: SFR) issued 166,006 shares at $7.23 per share to Auris as a
part of the Farm-In Agreement in relation to the Morck Well East and Doolgunna Projects.
As at 30 June 2018, the SFR share price was $9.16 equating to a total value of $1,520,615.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
58 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
9.
Property, plant and equipment
A reconciliation of the carrying amounts for each class of property, plant and equipment is set out below.
Carrying amount
At cost
Plant &
equipment
$
Office
equipment
$
Motor
vehicles
$
Total
$
75,304
204,205
409,789
689,298
Accumulated Depreciation
(63,471)
(115,752)
(272,116)
(451,339)
Balance at 30 June 2017
11,833
88,453
137,673
237,959
At cost
75,304
203,998
409,789
689,091
Accumulated Depreciation
(67,891)
(132,937)
(299,650)
(500,478)
Balance at 30 June 2018
7,413
71,061
110,139
188,613
Movement in carrying amount
Balance at 1 July 2016
Additions
Disposals
Depreciation
Balance at 30 June 2017
Balance at 1 July 2017
Additions
Disposals
Depreciation
Balance at 30 June 2018
29,630
1,764
(11,635)
(7,926)
11,833
11,833
-
-
(4,420)
7,413
109,946
11,916
(12,389)
(21,020)
88,453
88,453
1,020
(376)
(18,036)
71,061
152,758
68,145
(51,691)
(31,539)
137,673
292,334
81,825
(75,715)
(60,485)
237,959
137,673
237,959
-
-
(27,534)
110,139
1,020
(376)
(49,990)
188,613
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
59 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
10.
Exploration expenditure
Balance at 1 July 2016
Expenditure during the
period
Note
Exploration
$
10,720,149
(i)
4,509,206
Adjustment to environmental
liability
Impairment of assets
Balance at 30 June 2017
(iii)
(v)
Balance at 1 July 2017
Expenditure during the
period
320
(254,115)
14,975,557
14,975,557
(ii)
3,472,824
Proceeds during the period
Impairment of assets
Balance at 30 June 2018
(iv)
(v)
(1,200,000)
(364,813)
16,883,568
Evaluation
$
Development
$
Total
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
10,720,149
4,509,206
320
(254,115)
14,975,557
14,975,557
3,472,824
(1,200,000)
(364,813)
16,883,568
(i)
(ii)
(iii)
Expenditure included $13,650 in respect of the shares issued to Omni GeoX Pty Ltd pursuant to a joint venture agreement over
exploration tenements; $200,000 in respect of shares issued to Ascidian Prospecting Pty Ltd pursuant to an asset sale
agreement and $232,115 in respect of shares issued to Westgold Limited pursuant to an asset sale agreement (Note 11 (b)
(ii)).
Expenditure included $400,000 in respect of the shares issued to Ascidian Prospecting Pty Ltd pursuant to an asset sale
agreement (Note 11 (b) (ii)).
The estimated environmental liability is based on an annual assessment under the criteria adopted by the Mining Rehabilitation
Fund as implemented by the Department of Mines and Petroleum.
(iv)
Shares issued by Sandfire Resources NL per Farm-In Agreement (Note 8).
(v)
The carrying value has been impaired based on a review undertaken by an external consultant to determine the recoverability
of the current carrying value. The determination was based on examining the tenements held within each entity within the group
on a project-by-project basis to assess whether:
•
•
The expenditure and the associated activities have resulted in high priority exploration targets that will be the focus of
funded exploration over the next 2 years; and
An area of interest is considered likely to be recoverable by future exploitation or sale.
The directors supported the recommendations and approved the associated amounts impaired.
11.
Cash and cash equivalents
Bank balances
Cash and cash equivalents in the statement of cash flows
2018
2017
$
3,178,861
$
3,223,776
3,178,861
3,223,776
The exposure to interest rate risk and a sensitivity analysis for financial assets are discussed in note 20.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
60 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
11.
Cash and cash equivalents (continued)
a)
Reconciliation of cash flows from operating activities
Loss for the period after income tax
Adjusted for:
Depreciation expense
Impairment of exploration assets
Interest on convertible notes paid in shares
Employee share-based payments
Release from right of first refusal
Loss on disposal of assets
Note
2018
2017
$
(1,317,036)
$
(884,710)
3
9
11(b)
3
49,990
364,813
4,800
616,000
-
222
60,485
254,115
11,920
142,566
92,885
4,385
Operating loss before changes in working capital and provisions
(281,211)
(318,354)
Decrease / (increase) in trade and other receivables
Decrease / (increase) in trade and other payables
Decrease / (increase) in provisions
Net cash outflow from operating activities
b)
Non cash financing and investing activities
Issue of incentive options
Issue of shares
Issue of performance rights
Shares received – farm-in consideration
832
(26,786)
(17,787)
(29,676)
133,502
(45,347)
(324,952)
(259,875)
(i)
(ii)
(iii)
(iv)
-
400,000
616,000
(1,200,000)
(184,000)
142,566
538,650
-
-
681,216
(i)
Issue of Incentive Options
As approved by shareholders in general meeting held on 21 November 2013, the Company may issue unlisted
options to employees to subscribe for ordinary fully paid shares in the Company at any time within five years of
issue and at an exercise price approved by the directors. There are no voting or dividend rights attached to the
options and options issued under the plan were issued for no consideration. Voting rights will be attached to the
ordinary issued shares when the options have been exercised. Each option is convertible to one fully paid
ordinary share.
The following issues took place:
(cid:1)
(cid:1)
(ii)
(cid:1)
On 5 April 2017, the Company issued 1,000,000 employee incentive options to an employee at an
exercise price of $0.12 each and expiring on 20 September 2018. $39,220 was recognised as a share
based payment in the income statement.
On 27 March 2017, the Company issued 2,000,000 director options to Debbie Fullarton, 2,000,000
director options to Bronwyn Barnes and 1,000,000 director options to Robert Martin. These options were
issued at an exercise price of $0.12 each and expiring on 20 September 2018. $103,346 was recognised
as a share based payment in the income statement.
Issue of Shares
On 7 July 2017, 7,000,000 fully paid ordinary shares were issued to Ascidian Prospecting Pty Ltd
pursuant to an asset sale agreement. $400,000 was capitalised to exploration assets as a result of the
issue of shares. Refer to Note 10.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
61 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
11.
Cash and cash equivalents (continued)
(cid:1)
(cid:1)
(cid:1)
On 5 April 2017, 5,000,000 fully paid ordinary shares were issued to Westgold Limited pursuant to an
asset sale agreement over mining tenements and the release from the right of first refusal over
exploration tenements. $232,115 was capitalised to exploration assets and $92,885 was expensed as
a release of rights as a result of the issue of these shares. Refer to note 10.
On 20 December 2016, 260,000 (1,300,000 pre-consolidation) fully paid ordinary shares were issued
to Omni GeoX Pty Ltd pursuant to a joint venture agreement over exploration tenements. $13,650 was
capitalised to exploration assets as a result of the issue of these shares. Refer to note 10.
On 6 July 2016, 3,118,600 (15,593,000 pre-consolidation) fully paid ordinary shares were issued to
Ascidian Prospecting Pty Ltd pursuant to an asset sale agreement. $200,000 was capitalised to
exploration assets as a result of the issue of these shares. Refer to note 10.
(iii)
Issue of Performance Rights
(cid:1)
(cid:1)
On 22 November 2017, the Company issued 2,000,000 director performance rights to Bronwyn Barnes,
2,000,000 director performance rights to Robert Martin, 2,000,000 director performance rights to Susan
Vearncombe, 6,000,000 employee performance rights to Wade Evans and 4,000,000 employee
performance rights to Nick Franey. $704,000 was recognised as a shared based payment in the income
statement.
On 26 April 2018, the Company cancelled 2,000,000 director performance rights held by outgoing
director Susan Vearncombe. $88,000 was reversed from share based payment in the income statement.
(iv)
Shares Received – Farm-In Consideration
(cid:1)
On 7 March 2018, Auris received 166,006 Sandfire Resources shares at $7.23 per share as part of the
Farm-In Agreement for the Morck Well East and Doolgunna Projects.
12.
Trade and other payables
Trade payables and other accruals
Monies held in trust
2018
$
239,589
24,208
263,797
2017
$
440,719
43,614
484,333
Monies held in trust
On 20 February 2017, being the applicable record date, the Company provided shareholders with a notice of
intention to sell shares of less than a marketable parcel in accordance with the company constitution. Impacted
shareholders were given the opportunity to return their Notice of Retention by 10 April 2017 if they did not want
these shares to be sold on their behalf. The sale was concluded on 19 April 2017 and 1,350 shares holders
collectively holding 1,509,225 shares received their proceeds from the sale ($0.07 per share sold). The monies
currently held in trust represent unpresented cheques at the balance date.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
62 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
13.
Borrowings
Convertible notes
Movement in borrowings
Balance at 1 July
Notes issued
Notes converted
Balance at 30 June
Note
15
2018
$
40,000
40,000
2018
$
40,000
-
-
40,000
2017
$
40,000
40,000
2017
$
160,000
-
(120,000)
40,000
Convertible notes
As at 30 June 2018 there are two remaining convertible notes having a face value of $20,000 each maturing on
1 July 2018. Interest, at a rate of 12% per annum, is payable six monthly in June and December in shares
converted at a 30 day VWAP. The notes together with the accrued interest were converted into shares at an
issue price of $0.05 per share on 2 July 2018.
14.
Provisions
Current provisions
Employee leave benefits
Provision for stamp duty
2018
$
9,725
125,053
134,778
2017
$
55,916
125,053
180,969
Provision has been made for additional stamp duty in respect the share purchase acquisition of Auris Exploration
Pty Ltd for movable property, and an adjustment for the value of gold inventory. This had not previously been
taken into account when the interim assessment was issued by the Office of State Revenue on 13 December
2013.
Non-current provisions
Note
Environmental provision
Movement in non-current provisions
Balance at 1 July
Provision adjustment
Balance at 30 June
9
2018
$
129,880
129,880
129,880
-
129,880
2017
$
129,880
129,880
129,560
320
129,880
A provision has been made in respect of environmental rehabilitation on tenements based on the disturbance
criteria as determined by Department of Mines and Petroleum.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
63 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
15.
Issued capital and reserves
Issued and fully paid ordinary
shares
Movement in ordinary shares
On issue at 1 July
Consolidation of shares 5:1
Issue of shares for cash
Issue of shares on conversion of
convertible notes
Issue of share for interest on
convertible notes
Issue of shares to acquire
exploration licences
2018
$
2017
$
123,829,985
119,866,311
Note
2018
2018
2017
2017
No.
354,223,138
-
46,562,202
$
119,866,311
3,727,925
No.
1,286,553,365
- (1,029,242,197)
85,927,475
$
113,847,669
-
5,515,649
13
-
-
-
-
2,400,000
120,000
205,895
11,920
11(b)(ii)
7,000,000
400,000
6,949,600
445,765
Issue of shares in lieu of cash
payment for expenses
11(b)(ii)
Issue of listed options for cash
consideration
Share issue costs
On issue at 30 June
Listed options on issue
-
-
-
-
-
(164,251)
1,429,000
92,885
-
-
141,506
(309,083)
407,785,340
123,829,985
354,223,138
119,866,311
$0.08 listed options, expiring 20 September 2017
$0.12 listed options, expiring 20 June 2018
On issue at 30 June
Terms and conditions
2018
No.
-
-
2017
No.
49,776,458
49,776,458
-
99,552,916
The holders of ordinary shares are entitled to receive dividends from time to time and are entitled to one vote
per share at meetings of the Company. All shares rank equally with regard to the Company’s residual assets.
Nature and purpose of share-based payments reserve
The share-based payments reserve represents the fair value of equity instruments issued to employees as
compensation and issued to external parties for the receipt of goods and services. This reserve will be reversed
against issued capital when the underlying shares are converted and reversed against retained earnings when
they are allowed to lapse.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
64 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
15.
Issued capital and reserves (continued)
Movement in share-based payment reserve
Balance at 1 July
Share based payments
Expiry of options
Balance at 30 June
Movement in listed options
Note
2018
2017
11(b)(iii)
$
2,317,493
616,000
(1,692,368)
$
4,864,807
142,566
(2,689,880)
1,241,125
2,317,493
Options expiring on
or before
Exercise
price
On issue at
1 Jul 17
20 Sep 2017 (AUROA)
20 Jun 2018 (AUROB)
$0.08 49,776,458
$0.12 49,776,458
99,552,916
Issued
Exercised
Expired
On issue at
30 Jun 18
-
-
-
(9,863,478) (39,912,980)
(73,727) (49,702,731)
(9,937,205) (89,615,711)
-
-
-
Movement in unlisted options
Options expiring
on or before
Exercise
Price
On issue at
1 Jul 17
Consolidation
of options
Issued
Exercised
Expired
On issue at
30 Jun 18
15 Sep 2017
9 Nov 2017
31 Jan 2018
3 Oct 2018
8 Oct 2019
20 Sep 2018
20 Sep 2018
$1.25
$3.00
$0.15
$0.60
$1.30
$0.12
$0.12
600,000
300,000
600,000
1,480,000
2,500,000
5,000,000
1,000,000
11,480,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(600,000)
(300,000)
(600,000)
-
-
-
-
-
-
-
1,480,000
2,500,000
5,000,000
1,000,000
(1,500,000)
9,980,000
16.
Controlled entities
Auris Exploration Pty Ltd, incorporated in Australia (i), (ii)
(i)
(ii)
Auris Exploration Pty Ltd was formerly known as Grosvenor Gold Pty Ltd.
The parent entity acquired a 100% interest in Auris Exploration Pty Ltd on 8 March 2012.
17.
Segment reporting
2018
%
100
2017
%
100
The Group operations are entirely associated with exploration and related development activities in Western
Australia.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
65 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
18.
Parent information
Statement of Financial Position
Assets
Total current assets
Total non-current assets
Total assets
Liabilities
Total current liabilities
Total non-current liabilities
Total liabilities
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Statement of Profit and Loss and Other Comprehensive Income
Total loss
Total comprehensive loss
19.
Share based payments
Recognised share-based payments
2018
$
2017
$
3,179,515
40,808,635
3,225,511
14,814,906
43,988,150
18,040,417
257,400
22,816,631
23,074,031
340,858
48,080
388,938
123,829,985
1,241,125
(104,156,991)
119,866,311
2,317,493
(104,532,325)
20,914,119
17,651,479
1,317,036
3,864,926
1,317,036
3,864,926
Details of share based payments recognised during the year are shown in the table below.
Employee share based payments
KMP share based payments
Issue of shares
Note
11(b)(ii)
2018
$
176,000
440,000
616,000
400,000
1,016,000
2017
$
39,220
103,346
142,566
538,650
681,216
Equity based compensation plans (Long-term incentive bonus)
The Board has provided equity-based long-term incentives (LTIs) to promote continuity of employment and to
provide additional incentive to key management personnel to increase shareholder wealth. LTIs are provided as
options and rights over ordinary shares of the Company and are provided to key management personnel based
on their level of seniority and position within the Group. Options and rights may only be issued to directors
subject to approval by shareholders in general meeting.
There are no voting or dividend rights attached to the options and rights. Options and rights issued under the
plans were issued for no consideration. Voting rights will be attached to the ordinary issued shares when the
options and rights have been exercised. Each option and right is convertible to one fully paid ordinary share.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
66 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
19.
Share based payments (continued)
Issue of incentives
As approved by shareholders in general meeting the Company may issue unlisted options or rights to employees
to subscribe for ordinary fully paid shares in the Company with an expiry date not later than five years from the
date of issue and with an exercise price at the discretion of the directors.
The following options and rights were issued to employees and directors included in equity settled share-based
payments expenses under Administrative expenses in the statement of profit and loss and other comprehensive
income.
Issue of incentive options
Issue of performance rights
Equity settled share-based payment expense
Options granted as share based payments
There were no options issued during the reporting period.
2018
$
-
616,000
616,000
2017
$
142,566
-
142,566
The following table illustrates the number and weighted average exercise prices (WAEP) of, and movements in,
share options during the year:
Outstanding at 1 July
Granted during the year
Expired during the year
Outstanding at 30 June
2018
2017
No.
11,480,000
-
(1,500,000)
WAEP
$0.57
$0.00
$1.16
No.
54,120,000
6,000,000
(48,640,000)
WAEP
$0.30
$0.12
$0.21
9,980,000
$0.49
11,480,000
$0.57
The options have been restated on a post-consolidation basis.
The outstanding balance at 30 June 2018 is represented by:
Expiry date
Exercise Price
No. of shares
20 September 2018
3 October 2018
8 October 2019
$0.12
$0.60
$1.30
6,000,000
1,480,000
2,500,000
9,980,000
The number and pricing of options have been restated on a post-consolidation basis.
Weighted average remaining contractual life
The weighted average remaining contractual life for share options outstanding as at 30 June 2018 is 0.43 years
(2017: 1.35 years).
Range of exercise price
The range of exercise prices for options outstanding at the end of the year was $0.12 - $1.30 (2017: $0.08 -
$3.00). As the range of exercise prices is wide, refer to the above table for further information in assessing the
number and timing of additional shares that may be issued and the cash that may be received upon exercise of
those options.
Note the exercise prices have been restated on a post-consolidation basis.
67 | P a g e
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
19.
Share based payments (continued)
Weighted average fair value
The weighted average fair value of options granted during the year was nil (2017: $0.10).
Rights granted as share based payments
On 22 November 2017, the Company issued 16,000,000 performance rights which were approved at the
Company’s shareholder meeting. The performance rights were issued in two equal tranches, each with market
based performance milestones. Each performance right will convert into 1 ordinary share of AUR upon
achievement of the milestone by the milestone expiry date.
On 20 April 2018, Susan Vearncombe was removed as Non-Executive Director in a general meeting, Dr
Vearncombe was issued 2,000,000 performance rights on 22 November 2017. These rights were cancelled as
a result of her removal as Non-Executive Director.
Movement of rights during the reporting period is set out in the table below.
Balance at 1 July
Granted during the year
Cancelled during the year
Balance at 30 June
Fair value of performance rights
Tranche 1
Tranche 2
No.
Fair Value
No.
Fair Value
-
8,000,000
(1,000,000)
7,000,000
-
376,000
(47,000)
329,000
-
8,000,000
(1,000,000)
7,000,000
-
328,000
(41,000)
287,000
The following table sets out the assumptions made in determining the fair value of the performance rights
granted during the period which were estimated at the date of grant using the single barrier share option pricing
model.
Tranche
No.
Grant date Volatility
Risk-free
rate
Exercise
price
Expiry
date
Fair
value per
right
Total
fair
value
1
2
8,000,000 22 Nov 2017
90%
1.91%
8,000,000 22 Nov 2017
90%
1.91%
nil
nil
22 Nov 2020
0.047
376,000
22 Nov 2020
0.041
328,000
Performance milestones:
(1)
Vest upon achieving a market capitalisation of $48 million for a period of 30 consecutive days.
(2)
Vest upon achieving a market capitalisation of $64 million for a period of 30 consecutive days.
20.
Financial instruments
Financial risk management
This note presents information about the Group’s exposure to credit, liquidity and market risks, their objectives,
policies and processes for measuring and managing risk, and the management of capital.
The Group’s principal financial instruments comprise receivables, payables, borrowings, cash and short-term
deposits. All financial assets measured at fair value are considered to be Level 1 financial assets. That is, they
have quoted prices in active markets for identical assets.
Risk exposures and responses
The Group manages its exposure to key financial risks in accordance with the Group’s financial risk management
policy. The objective of the policy is to support the delivery of the Group’s financial targets while protecting future
financial security.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
68 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
20.
Financial instruments (continued)
The Board of Directors has overall responsibility for the establishment and oversight of the risk management
framework. Management monitors and manages the financial risks relating to the operations of the Group
through regular reviews of the risks.
The main risks arising from the Group’s financial instruments are interest rate risk and liquidity risk. The Group
uses different methods to measure and manage different types of risks to which it is exposed. These include
monitoring levels of exposure to interest rates via assessments of market forecasts for interest rates and
monitoring liquidity risk through the development of future rolling cash flow forecasts.
The Group does not use any form of derivatives as the Group’s operations and related financial instruments are
not at a level of complexity to require the use of derivatives to hedge its exposures. The Group does not enter
into or trade financial instruments, including derivative financial instruments, for speculative purposes.
Credit risk
Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in a financial loss
to the Group. The Group’s potential concentration of credit risk consists mainly of cash deposits with banks and
other receivables. The Group’s short term cash surpluses are placed with banks that have investment grade
ratings.
The maximum credit risk exposure relating to the financial assets is represented by the carrying value as at the
balance sheet date. The Group considers the credit standing of counterparties when making deposits to manage
the credit risk.
Considering the nature of the Group’s ultimate customers and the relevant terms and conditions entered into
with such customers, the Group believes that the credit risk is immaterial.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The
Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity
to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses
or risking damage to the Group’s reputation.
Ultimate responsibility for liquidity risk management rests with the Board of Directors. The Group manages
liquidity risk by maintaining adequate cash reserves either from funds raised in the market or via short term
loans and by continuously monitoring forecast and actual cash flows.
The following are the contractual and expected maturities of the Group’s non-derivative, non-cash financial
assets and the Group’s expected maturities of financial liabilities:
As at 30 June 2018
Financial assets
Trade and other receivables
Financial liabilities
Trade and other payables
Provisions
Borrowings - current
Net outflow
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
Within 6
months
6 to 12
months
$
31,532
31,532
263,797
134,778
40,000
438,575
(407,043)
$
-
-
-
-
-
-
-
>12 months
Total
$
-
-
-
-
-
-
-
$
31,532
31,532
263,797
134,778
40,000
438,575
(407,043)
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NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
20.
Financial instruments (continued)
As at 30 June 2017
Financial assets
Trade and other receivables
Financial liabilities
Trade and other payables
Provisions
Borrowings - current
49,371
49,371
484,333
180,969
-
665,302
-
-
-
-
40,000
40,000
Net outflow
(615,931)
(40,000)
-
-
-
-
-
-
-
49,371
49,371
484,333
180,969
40,000
705,302
(655,931)
Equity price risk
Equity price risk is the risk that the value of the Group’s financial instruments will fluctuate as a result of changes
in market prices (other than those arising from interest rate risk or currency risk), whether caused by factors
specific to an individual investment, its issuer or all factors affecting all instruments traded in the market.
Capital risk management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going
concern, so as to maintain a strong capital base sufficient to maintain future exploration, evaluation and
development of its mineral projects. In order to maintain or adjust the capital structure, the Group may return
capital to shareholders, issue new shares or sell assets to reduce debt.
Due to the Group being principally involved in mineral exploration, the primary source of funding is equity
raisings.
The Company also encourages employees and directors to be shareholders through its various equity-based
long-term incentives as detailed in Note 21.
As at 30 June 2018, the Group had a net working capital of $3,971,818 (2017: $2,567,845), The Group’s net
asset position was $20,914,119 (2017: $17,651,481).
There were no changes in the Group’s approach to capital management during the year. Risk management
policies and procedures are established with regular monitoring and reporting.
The Group is not subject to externally imposed capital requirements.
Fair value
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the
basis of measurement and the basis on which revenues and expenses are recognised, in respect of each class
of financial asset, financial liability and equity instrument are disclosed in Note 2 to the financial statements.
The financial assets and liabilities included in the assets and liabilities of the Group approximate net fair value,
determined in accordance with the accounting policies disclosed in Note 2 to the financial statements.
Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity
prices will affect the Group’s income or the value of its holdings of financial instruments. The objective of market
risk management is to manage and control market risk exposures within acceptable parameters, while optimising
the return.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
70 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
20.
Financial instruments (continued)
Cash flow interest rate risk
The Group is exposed to interest rate risk, primarily on its cash and cash equivalents. Cash flow interest rate
risk is the risk that a financial instrument’s value will fluctuate as a result of changes in the market interest rates
on interest- bearing financial instruments. The Group does not use derivatives to mitigate these exposures. The
interest rate on the short term loan is fixed.
The interest rate profile of the Group’s interest-bearing financial instruments was:
Fixed interest rate maturity
Average
interest
rate
%
Variable
interest
rate
A$
Less than 1
year
1 to 5
years
More than 5
years
Total
A$
A$
A$
A$
3.3
3,178,861
-
12.0
-
40,000
1.6
3,223,776
-
12.0
-
40,000
-
-
-
-
-
-
-
-
3,178,861
40,000
3,223,776
40,000
At 30 June 2018
Financial assets
Cash and cash equivalents
Financial liabilities
Borrowings - current
At 30 June 2017
Financial assets
Cash and cash equivalents
Financial liabilities
Borrowings - current
Cash flow sensitivity analysis for variable rate instruments
A change of 100 basis points in interest rates at the reporting date would have no material impact on the income
statement. There would be no effect on the equity reserves other than those directly related to income statement.
21.
Related parties
Key management personnel compensation
Refer to the remuneration report contained in the directors’ report for details of the remuneration paid or payable
to each member of the Group’s key management personnel (KMP) for the year ended 30 June 2018.
The totals of remuneration paid to KMP of the Group during the year comprised:
Short-term employee benefits
Post-employment benefits
Termination benefits
Share-based payments
2018
$
346,763
28,722
86,336
440,000
901,821
2017
$
350,167
33,289
56,250
103,346
543,052
Other than the directors and Chief Executive Officer, no other person is concerned in, or takes part in, the
management of the Group or has the authority and responsibility for planning, directing and controlling the
activities of the Group.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
71 | P a g e
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
21.
Related parties (continued)
Short-term employee benefits
These amounts include fees and benefits paid to the Non-Executive Directors as well as all fees, salary, paid
leave, fringe benefits awarded to Executive Directors as well as the Chief Executive Officer.
Post-employment benefits
These represent the cost of superannuation contributions made during the year.
Share-based payments
These amounts represent expense related to the participation of directors in equity-settled benefit schemes as
measured by the fair value of options or rights granted on the grant date.
Further information in relations to key management personnel remuneration can be found in the directors’ report.
Individual directors and executives compensation disclosures
Information regarding individual directors' compensation and some equity instruments disclosures as required
by Corporations Regulations 2M.3.03 is provided in the Remuneration Report section of the Directors’ Report.
Apart from the details disclosed in this note, no director has entered into a material contract with the Group since
the end of the previous financial year and there were no material contracts involving directors’ interests at year-
end.
Key management personnel and director transactions
A number of key management persons, or their related parties, hold positions in other entities that result in them
having control or significant influence over the financial or operating policies of those entities. A number of these
entities transacted with the Company or its subsidiaries in the reporting period. The terms and conditions of the
transactions with management persons and their related parties were no more favourable than those available,
or which might reasonably be expected to be available, on similar transactions to non-director related entities
on an arm’s length basis.
The aggregate value of transactions and outstanding balances relating to key management personnel and their
related entities over which they have control or significant influence were as follows:
22.
Commitments
Exploration expenditure commitments in respect of tenement holdings
Payable not later than 12 months
Payable between 12 months and 5 years
2018
$
1,580,780
6,323,120
7,903,900
2017
$
1,599,418
6,397,672
7,997,090
23.
Events subsequent to reporting date
Except for the events noted below, no other material events have occurred subsequent to the reporting date.
(cid:1)
(cid:1)
(cid:1)
On 3 July 2018, 800,000 fully paid ordinary shares were issued following conversion of 2 Convertible
Notes and 96,000 fully paid ordinary shares were issued relating to the accrued interest on these
Convertible notes.
On 6 July 2018, Wade Evans resigned as Chief Executive Officer and Mr Mike Hendriks was appointed
on an initial 3 month consultancy to oversee day-to-day management.
On 20 July 2018, the follow-up drilling in the Morck Well Joint Venture was completed and the MLEM
surveying was underway.
72 | P a g e
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
NOTES TO THE CONSOLIDATED FINANCIAL REPORTS
FOR THE YEAR ENDED 30 JUNE 2018
23.
Events subsequent to reporting date (continued)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
(cid:1)
On 27 July 2018, the VTEM survey identifies multiple targets in the Bryah Basin.
On 1 August 2018, Mr Craig Hall was appointed Non-Executive Director and is the nominated
representative for the interests of Investmet Limited.
On 5 September 2018, a new geological interpretation of the Forrest Project was completed.
On 14 September 2018, an Aircore drilling programme at the Wodger Prospect commenced.
On 20 September 2018, 6,000,000 unexercised $0.12 options expired.
24.
Contingent liability
As outlined at Note 14, the OSR is still undergoing a review process for additional stamp duty in respect to the
share purchase acquisition of Auris Exploration Pty Ltd, and are yet to issue their final assessment. No further
provision (in addition to that at Note 14) has been provided for any additional duty that may arise, as
management believe they have adequately substantiated the remaining items in dispute. However, final
determination of additional stamp duty to be paid is yet to be agreed with the OSR and therefore maybe more
than outlined at Note 14, however as of today’s date it is impossible to predict with reasonable certainty the
extent of any additional costs.
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
73 | P a g e
DIRECTORS’ DECLARATION
In the opinion of the directors of Auris Minerals Limited
(a)
the Consolidated Financial Statements and Notes, as set out on pages 44 to 73, and the Remuneration
Report in the Directors’ Report, are in accordance with the Corporations Act 2001, including:
(i)
(ii)
giving a true and fair view of the Group’s financial position as at 30 June 2018 and of its
performance, for the financial year ended on that date; and
complying with Australian Accounting Standards
Interpretations) and the Corporations Regulations 2001;
(including
the Australian Accounting
(b)
(c)
the financial report also complies with International Financial Reporting Standards as disclosed in note
1(a);
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable.
The directors have been given the declarations required by section 295A of the Corporations Act 2001 from the
Chief Executive Officer (equivalent) and Chief Financial Officer (equivalent) for the financial year ended 30 June
2018.
Signed in accordance with a resolution of the directors.
NEVILLE BASSETT
NON-EXECUTIVE CHAIR
Dated at West Perth this 26th day of September 2018
Auris Minerals Limited I 2018 ANNUAL REPORT
ABN 77 085 806 284
74 | P a g e