Auric Mining Limited
Annual Report 2022

Plain-text annual report

Auric Mining Limited and CONTROLLED ENTITIES ACN 635 470 843 Financial Statements 31 December 2022 Auric Mining Limited and CONTROLLED ENTITIES Contents 31 December 2022 Directors' report Auditor's independence declaration Consolidated statements of profit or loss and other comprehensive income Consolidated statements of financial position Consolidated statements of changes in equity Consolidated statements of cash flows Notes to the consolidated financial statements Directors' declaration Independent auditor's report to the members of Auric Mining Limited Shareholder information 2 13 14 15 16 17 18 39 40 45 General information The financial statements cover both Auric Mining Limited as an individual entity and the consolidated entity consisting of Auric Mining Limited and the entities it controlled at the end of, or during, the year. The financial statements are presented in Australian dollars, which is Auric Mining Limited's functional and presentation currency. Auric Mining Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business are: Registered office Level 1, 1 Tully Road, East Perth WA 6004 Principal place of business Level 1, 1 Tully Road, East Perth WA 6004 A description of the nature of the consolidated entity's operations and its principal activities are included in the Directors' report. The financial statements were authorised for issue, in accordance with a resolution of Directors, on 9 March 2023. 1 Auric Mining Limited and CONTROLLED ENTITIES Directors' report 31 December 2022 The Directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'consolidated entity') consisting of Auric Mining Limited (referred to hereafter as "Auric', the "Company" or "parent entity") and the entities it controlled at the end of, or during, the year ended 31 December 2022. Directors The following persons were Directors of Auric Mining Limited during the whole of the financial year and up to the date of this report, unless otherwise stated: Steven Morris - Non-Executive Chair Mark English - Managing Director John Utley - Executive Director Stephen Strubel - Non-Executive Director (Retired 27 May 2022) Particulars of each Director's experience and qualifications are set out later in this report. Principal Activities The principal activities of the Group during the financial period were gold exploration and development. Operating and Financial Review The Company completed further RC drilling programs at both Munda and Guest; Aircore drilling at Chalice West and continued the development of the Jeffreys Find Deposit. The Company announced an upgrade of Munda resource as announced to ASX on 28 January 2022. The Company completed the Metallurgical Testwork for both Jeffreys Find and Munda as announced to the ASX on 6 May 2022 and 11 May 2022. On 18 May 2022, the Company executed an exclusive option agreement to acquire all mineral rights for the Chalice West Project tenements E15/1801 and E63/2199 thereby providing Auric further landholdings in the Widgiemooltha/ Norseman area. The Company completed a scoping study for Jeffreys Find as announced to the ASX on 11 July 2022. The Company entered into a joint mining arrangement with BML Ventures Pty Ltd for the Jeffreys Find Deposit as announced to the ASX on 22 August 2022. The loss for the consolidated entity after providing for income tax amounted to $1,106,692 (31 December 2021: loss of $1,103,126). Significant changes in the state of affairs There were no significant changes in the state of affairs of the consolidated entity during the financial year. Dividends There were no dividends paid, recommended or declared during the current or previous financial year. Matters subsequent to the end of the financial year After the year ended 31 December 2022, the Company submitted 3 tenement applications to acquire P15/6786, E15/1978 and E15/1979. No other matter or circumstance has arisen since 31 December 2022 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years. Likely developments and expected results of operations Information on likely developments, future prospects and business strategies of the operations of the consolidated entity and the expected results of operations, not otherwise disclosed in this report, have not been included in this report because the Directors believe that the inclusion of such information would be likely to result in unreasonable prejudice to the consolidated entity. 2 Auric Mining Limited AND CONTROLLED ENTITIES Directors' report 31 December 2022 Indemnifying Officers or Auditor During the year, the Group maintained an insurance policy which indemnifies the directors and officers in respect of any liability incurred in connection with the performance of their duties as directors and officers of the Group to the extent permitted by the Corporations Act 2001. The Group has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the Company or any related entity against a liability incurred by the auditor. During the financial year, the Group has not paid a premium in respect of a contract to insure the auditor of the Company or any related entity. Environmental regulation The consolidated entity is not subject to any significant environmental regulation under Australian Commonwealth or State law as it is still in exploration stages. Risk Statement The consolidated entity is committed to the effective management of risk to reduce uncertainty in the consolidated entity’s business outcomes and to protect and enhance shareholder value. There are various risks that could have a material impact on the achievement of the consolidated entity’s strategic objectives and future prospects. Key risks and mitigation activities associated with the consolidated entity’s objectives are set out below: COVID-19 impacts The ongoing COVID-19 pandemic has had a significant impact on the global economy and the ability of businesses, individuals and governments to operate. Given the ongoing and dynamic nature of the circumstances, it is difficult to predict the impact of the pandemic on the consolidated entity’s business (or on the operations of other businesses on which it relies), and there is no guarantee that the consolidated entity’s efforts to address the adverse impacts of COVID-19 will be effective. The impact to date has included periods of significant volatility in financial, commodities and other markets. This volatility, if it continues could have an adverse impact on the consolidated entity’s condition and results of operations. There continues to be considerable uncertainty as to the duration and further impact of COVID-19, including (but not limited to) government, regulatory or health authority actions, work stoppages, lockdowns, quarantines, and travel restrictions. The impact of some or all of these factors could cause significant disruption to the consolidated entity’s operations and financial performance. The consolidated entity continues to put in place mitigation strategies in relation to the COVID-19 pandemic and ensures a COVID safe environment is carried out at all of its work sites. Exploration risk The consolidated entity’s projects are at various stages of exploration, and potential investors should understand that mineral exploration is a high-risk undertaking. There can be no assurance that exploration of these projects, or any other tenements that may be acquired in the future, will result in the discovery of an economic mineral deposit. The future exploration activities of the consolidated entity may be affected by a range of factors including geological conditions, limitations on activities due to seasonal weather patterns, unanticipated operational and technical difficulties, industrial and environmental accidents, local title processes, changing government regulations and many other factors beyond the control of the consolidated entity. In addition, the tenements forming the projects of the consolidated entity may include various restrictions excluding, limiting or imposing conditions upon the ability of the consolidated entity to conduct exploration activities. While the consolidated entity will formulate its exploration plans to accommodate and work within such access restrictions, there is no guarantee that the consolidated entity will be able to satisfy such conditions on commercially viable terms, or at all. The consolidated entity uses a number of exploration techniques in order to reduce the level of exploration risks and continues to explore new and innovative technologies through its day to day operations. 3 Auric Mining Limited AND CONTROLLED ENTITIES Directors' report 31 December 2022 Regulatory risk The consolidated entity’s mining and exploration activities are dependent upon the maintenance (including renewal) of the tenements in which the consolidated entity has or acquires an interest. Maintenance of the consolidated entity’s tenements is dependent on, among other things, the consolidated entity’s ability to meet the licence conditions imposed by relevant authorities. Although the consolidated entity has no reason to think that the tenements in which it currently has an interest will not be renewed, there is no assurance that such renewals will be given as a matter of course and there is no assurance that new conditions will not be imposed by the relevant authority or whether the consolidated entity will be able to meet the conditions of renewal on commercially reasonable terms, if at all. The consolidated entity works with local government and mining departments to ensure it meets the required level of reporting requirements and to reduce any potential for breach of regulatory requirements. Future funding risk The consolidated entity has no operating revenue. Exploration and development costs and pursuit of its business plan will use funds from the consolidated entity’s current cash reserves and the amounts raised under other funding opportunities. The development of one or more of its projects may require the consolidated entity to raise capital. Any additional equity financing may be dilutive to Shareholders, may be undertaken at lower prices than the market or may involve restrictive covenants which limit the consolidated entity’s operations and business strategy. Debt financing, if available, may involve restrictions on financing and operating activities. Although the directors believe that additional capital can be obtained, no assurances can be made that appropriate capital or funding, if and when needed, will be available on terms favourable to the consolidated entity or at all. If the consolidated entity is unable to obtain additional financing as needed, it may be required to reduce the scope of its activities and this could have a material adverse effect on the consolidated entity’s activities and could affect the consolidated entity’s ability to continue as a going concern. The consolidated entity’s funding requirements are reviewed on a regular basis in order to mitigate future funding risk. Proceedings on Behalf of the Company No person has applied for leave of a Court to bring proceedings against the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The Company was not a party to any Court proceedings during the period. Non-audit services There were no non-audit services provided during the financial year by the auditor. Options At the date of this report, the unissued ordinary shares of Auric Mining Limited under option are as follows: Grant date 29 January 2021 5 October 2022 29 November 2022 8 December 2022 16 December 2022 19 December 2022 Total Options Expiry date 31 October 2023 31 March 2024 31 March 2024 31 March 2024 31 March 2024 31 March 2024 Exercise price Number under option $0.40 43,908,175 7,848,612 $0.15 6,680,529 $0.15 1,999,994 $0.15 900,000 $0.15 300,000 $0.15 61,637,310 Option holders do not have any rights to participate in any issues of shares or other interests of the Company or any other entity. There have been no options granted over unissued shares or interests of any controlled entity within the Group since the end of the financial year. 4 Auric Mining Limited AND CONTROLLED ENTITIES Directors' report 31 December 2022 During the year ended 31 December 2022, no shares of Auric Mining Limited were issued on the exercise of options granted. No person entitled to exercise an option had or has any right by virtue of the option to participate in any share issue of any other body corporate. During the year ended 31 December 2022, 16,529,135 options were issued as part of the capital raising. 300,000 options were issued as part of the cost of raising capital. These 300,000 options were brought to account in the 31 December 2022 financial statements in the option reserve. 900,000 options were issued as part of the employee incentive share plan. Information on Directors and Company Secretary Name: Title: Qualifications: Experience and expertise: Steven John Morris Non-Executive Chair Diploma of Financial Markets (FINSIA) Steven has over 30 years’ experience in financial markets. He was Head of Private Clients (Australia) for Patersons Securities, Managing Director of Intersuisse Ltd, Founder and Managing Director of Peloton Shareholder Services and held senior executive roles in the Little Group. Steven is Vice President of the Melbourne Football Club. Other current directorships: Former directorships (last 3 years): Steven was previously the Chair of Purifloh Ltd (ASX:PO3) until November 2019 and a Steven was a Non-Executive Director of De Grey Mining Ltd(“DEG”) from 2014 to 2019 and Chairman of ASX-listed Purifloh Ltd (“PO3”) from 2013 to 2019. None Interests in shares: Interests in options: Name: Title: Qualifications: Experience and expertise: Director of De Grey Mining Ltd (ASX:DEG) until July 2019 6,683,333 ordinary shares of Auric Mining Limited 2,312,500 options of Auric Mining Limited expiring 31 October 2023 @ $0.40 104,166 options of Auric Mining Limited expiring 31 March 2024 @ $0.15 Mark Anthony English Managing Director Bachelor of Business (Curtin University) Fellow of the Institute of Chartered Accountants Australia and New Zealand Member of the Institute of Company Directors Mark is a Chartered Accountant and a member of the Australian Institute of Company Directors. Mark has 40 year career in the resources sector and corporate services. Mark has particular responsibility for Company strategy, financial management, corporate development and acquisition opportunities. Mark was a founding Director of Bullion Minerals Ltd, that he managed for 10 years including completing IPO. Mark is a Co-Founder, Director and Shareholder in the Moora Citrus group of companies, WA’s largest citrus producing orchard in operation for over 20 years. Other current directorships: None Former directorships (last 3 years): None Interests in shares: Interests in options: 7,238,433 ordinary shares of Auric Mining Limited 2,515,834 options of Auric Mining Limited expiring 31 October 2023 @ $0.40 208,333 options of Auric Mining Limited expiring 31 March 2024 @ $0.15 5 Auric Mining Limited and CONTROLLED ENTITIES Directors' report 31 December 2022 Experience and expertise: Name: Title: Qualifications: John Peter Utley Technical Director Master's of Science in Earth Sciences (University of Waikato, New Zealand) Member of the Australian Institute of Mining and Metallurgy Member of the Australian Institute of Geoscientists John has a 35 year career in mining and exploration, principally gold sector. John has worked in Australia, South America, Papua New Guinea and in Canada where he was Chief Geologist for Atlantic Gold Corporation, during exploration and development of the Touquoy Gold Mine and other gold deposits in Nova Scotia, prior to its acquisition by St Barbara. John previously worked with Plutonic Resources Ltd, where he was head of the exploration team at Darlot Gold Mine, during the discovery and development of the 2.3M ounce Centenary gold deposit. None Other current directorships: Former directorships (last 3 years): None Interests in shares: Interests in options: 6,976,666 ordinary shares of Auric Mining Limited 2,527,500 options of Auric Mining Limited expiring 31 October 2023 @ $0.40 208,333 options of Auric Mining Limited expiring 31 March 2024 @ $0.15 Name: Title: Qualifications: Experience and expertise: Stephen Rodney Strubel (Retired 27 May 2022) Non-Executive Director (Stephen was the Company Secretary from 19 August 2019 to 1 February 2022) Bachelor of Business in Banking and Finance/International Trade (Victoria University) Graduate Certificate in Business (Finance) (Victoria University) Master's in Business Administration (Australian Institute of Business) Fellow Governance Institute of Australia (FGIA) Stephen completed a Bachelor of Business in Banking and Finance/International Trade and Graduate Certificate in Business (Finance) from Victoria University and has an MBA from the Australian Institute of Business. He is a Fellow of the Governance Institute of Australia. Stephen has worked in financial markets in Melbourne for approximately 10 years predominantly with Patersons Securities. Stephen was a Non-Executive Director of Star Minerals Ltd (“SMS”) and Executive Director of ChemX Materials Ltd ("CMX"). An Executive Director of ChemX Materials Ltd (ASX:CMX) 2021 to date Other current directorships: Former directorships (last 3 years): A Non-Executive Director of Star Minerals Ltd (ASX:SMS) 2021 to 2022 Experience and expertise: Name: Title: Qualifications: Tamara Monica Barr Company Secretary: Appointed: 1 February 2022 Certificate in Governance Practice (Governance Institute of Australia) Affiliated Member (GIA) Tamara is a highly experienced ASX Company Secretary with over 17 years’ experience practising as a Company Secretary and Corporate Governance Advisor across a variety of sectors and industries. She has worked predominantly in Australia, as well as in the UK and Europe, providing Company Secretarial advice and service to ASX listed, Public and NFP companies. Tamara is Managing Director of corporate services firm, Clear Sky Blue Pty Ltd where Tamara works closely with Boards to enhance their Corporate Governance procedures. None Other current directorships: Former directorships (last 3 years): None 6 Auric Mining Limited AND CONTROLLED ENTITIES Directors' report 31 December 2022 Meetings of Directors The number of meetings of the Company's Board of Directors ('the Board') held during the year ended 31 December 2022, and the number of meetings attended by each Director were: Steven Morris Mark English John Utley Stephen Strubel Full Board Attended Held 10 10 10 6 10 10 10 6 Held: represents the number of meetings held during the time the Director held office. All other matters requiring approval by the Directors, have been approved by Circular Resolution. Remuneration report (audited) Remuneration Policy The remuneration policy of the company has been designed to align key management personnel (KMP) objectives with shareholder and business objectives by providing a fixed remuneration component. The Board of the company believes the remuneration policy to be appropriate and effective in its ability to attract and retain high-quality KMP to run and manage the Group, as well as create goal congruence between Directors, executives and shareholders. For the purposes of this report, KMP comprises executive and non-executive Directors of the Group, as follows: Steven Morris – Non-Executive Chair Mark English – Managing Director John Utley – Technical Director Stephen Strubel – Non-Executive Director (Retired 27 May 2022) The Board’s policy for determining the nature and amount of remuneration for KMP of the Group is based on the following: - The remuneration policy is developed and approved by the Board after professional advice, if required. - All KMP receive a base salary (which is based on factors such as length of service and experience), superannuation, fringe benefits and long service leave. - The Board reviews KMP packages annually by reference to the Group’s performance, executive performance and comparable information from industry sectors. KMP receive, at a minimum, a superannuation guarantee contribution required by the government, which is currently 10.5% of the individual’s average weekly ordinary time earnings (AWOTE). Some individuals, however, have chosen to sacrifice part of their salary to increase payments towards superannuation. All remuneration paid to KMP is valued at the cost to the Group and expensed. The Board’s policy is to remunerate non-executive Directors at market rates for time, commitment and responsibilities. The Board determines payments to the non-executive Directors and reviews their remuneration annually, based on market practice, duties and accountability. Independent external advice is sought when required. The current amount has been set at an amount not to exceed $250,000 per annum. The maximum aggregate amount of fees that can be paid to non-executive Directors is subject to approval by shareholders at general meeting. Options granted under the arrangement do not carry dividend or voting rights. Each option is entitled to be converted into one ordinary share once the interim or final financial report has been disclosed to the public and is measured using the Hoadley’s Binomial Model. 7 Auric Mining Limited and CONTROLLED ENTITIES Directors' report 31 December 2022 Relationship between Remuneration Policy and Company Performance The remuneration policy has been tailored to increase goal congruence between shareholders, Directors and executives. The method has been applied to achieve this aim. As at the date of this report, there is no performance-based bonuses based on KPI’s. Employment Details of Members of Key Management Personnel The following table provides employment details of persons who were, during the financial year , members of KMP of the Group. The table also illustrates the proportion of remuneration that was performance and non-performance based. 8 2022 2021 Proportions of Elements of Remuneration Related to Performance (Other than Options Issued) Proportions of Elements of Remuneratio n Not Related to Performance Proportions of Elements of Remuneration Related to Performance (Other than Options Issued) Proportions of Elements of Remuneration Not Related to Performance Shares/ Units Fixed Salary/Fees Non-salary Cash- based Incentives Shares/ Units Fixed Salary/Fees Non-salary Cash- based Incentives % % % % % % – – 100 – – 100 – – 100 – 100 – – 100 – 100 – – 100 – – 100 Auric Mining Limited and CONTROLLED ENTITIES Directors' report 31 December 2022 Position Held as at 31 December 2022 and any Change During the Year Contract Details (Duration and Termination) Group KMP Steven Morris Non-executive Chair Consultancy agreement commenced 14 December 2020 for three years. The the Company may terminate three Consultancy Agreement with months’ notice. The Consultant may terminate the Consultancy Agreement by giving the Company one months’ notice or immediately if Mr Morris the ceases Company. to be a Director of Mark English Managing Director John Utley Technical Director Stephen Strubel Non-Executive Director terminate Executive agreement Services commenced 14 December 2020 and continues in force till terminated. The the Company may Agreement with three months’ notice and the payment of twelve months base salary. The executive may terminate the Agreement by giving the Company three months’ notice and being paid twelve months base salary upon certain events. terminate Executive agreement Services commenced 14 December 2020 and continues in force till terminated. The Company may the Agreement with three months’ notice and the payment of twelve months base salary. The executive may terminate the Agreement by giving the Company three months’ notice and being paid twelve months base salary upon certain events. terminate Executive agreement Services commenced 14 December 2020 and continues in force till terminated. The Company may the Agreement with three months’ notice and the payment of twelve months base salary. The executive may terminate the Agreement by giving the Company three months’ notice and being paid twelve months base salary upon certain events. 9 Auric Mining Limited and CONTROLLED ENTITIES Directors' report 31 December 2022 The employment terms and conditions of all KMP are formalised in contracts of employment or consulting agreements. Remuneration Expense Details for the Year Ended 31 December 2022 The following table of benefits and payments represents the components of the current year remuneration expenses for each member of KMP and their related parties of the Group. Such amounts have been calculated in accordance with Australian Accounting Standards. Short-term benefits Short-term benefits Short-term benefits Post- employme nt Salary & Fees $ Bonus $ Annual leave¹ $ Super $ Other long- term benefits Long service leave² $ Share- based payments Share rights $ Total Performan ce related $ % 48,000 228,933 182,407 18,629 477,969 - - - - - - 17,944 14,632 - - 28,735 19,523 1,712 - 5,056 4,083 - 32,576 49,970 9,139 - - - - - 48,000 280,668 220,645 20,341 569,654 - - - - - 2022 Directors Steven Morris Mark English John Utley Stephen Strubel Total ¹ Paid and accrued annual leave ² Accrued long service leave Short-term benefits Short-term benefits Short-term benefits Post- employme nt Salary & Fees $ Bonus $ Annual leave $ Super $ Other long- term benefits Long service leave $ Share- based payments Share rights $ Total Performan ce related $ % 48,000 241,449 195,016 66,863 551,328 - - - - - - 8,881 6,439 1,201 - 25,896 19,356 6,636 - 4,334 3,501 1,200 16,521 51,888 9,035 - - - - - 48,000 280,560 224,312 75,900 628,772 - - - - 2021 Directors Steven Morris Mark English John Utley Stephen Strubel Securities Received that Are Not Performance-related No members of KMP are entitled to receive securities that are not performance-based as part of their remuneration package. Cash Bonuses, Performance-related Bonuses and Share-based Payments No bonuses or share-based payments were paid to members of KMP during 31 December 2022 year. 10 Auric Mining Limited and CONTROLLED ENTITIES Directors' report 31 December 2022 Additional disclosures relating to key management personnel KMP Shareholdings The number of ordinary shares in Auric Mining Limited held by each KMP and their related parties of the Group during the financial year and up to the date of this financial report is as follows: Ordinary shares Steven Morris Mark English John Utley Balance at Received the start of as part of the year remuneration Additions Disposals/ other Balance at the end of the year 6,225,000 6,681,767 6,420,000 19,326,767 - - - - 458,333 556,666 556,666 1,571,665 - 6,683,333 - 7,238,433 6,976,666 - - 20,898,432 Option holdings The number of options in Auric Mining Ltd held by each KMP and their related parties of the Group during the financial year and up to the date of this financial report, exercisable at $0.40 with expiry date of 31 October 2023 is as follows: Balance at the start of the year Granted Expired/ forfeited/ Balance at the end of the year Exercised other Options over ordinary shares Steven Morris Mark English John Utley 2,312,500 2,515,834 2,527,500 7,355,834 - - - - - - - - - - - - 2,312,500 2,515,834 2,527,500 7,355,834 The number of options in Auric Mining Ltd held by each KMP and their related parties of the Group during the financial year and up to the date of this financial report, exercisable at $0.15 with expiry date of 31 March 2024 is as follows: Balance at the start of the year Granted Expired/ forfeited/ Balance at the end of the year Exercised other Options over ordinary shares Steven Morris Mark English John Utley - 104,166 - 208,333 - 208,333 520,832 - During the year ended 31 December 2022, the above options were issued to KMP and their related parties as a consequence of capital raisings. 104,166 208,333 208,333 520,832 - - - - - - - - There have been no KMP transactions involving equity instruments apart from those described in the tables above relating to options and shareholdings. Other Transactions with KMP and/or their Related Parties There were no other transactions conducted between the Group and KMP or their related parties, apart from those disclosed above relating to equity and compensation 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 Remuneration Report Exploration and Evaluation Expenditure Exploration and evaluation expenditure is capitalised and valued at cost. The directors are of the opinion that the recoverable amount of exploration and evaluation expenditure is greater than cost, as per the financial statements and accordingly there is no impairment required. 11 Auric Mining Limited and CONTROLLED ENTITIES Directors' report 31 December 2022 This Directors’ Report, incorporating the remuneration report, is signed in accordance with a resolution of the Board of Directors: On behalf of the Directors ___________________________ Mark English Managing Director 9 March 2023 Perth WA 12 AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001 TO THE DIRECTORS OF AURIC MINING LIMITED I declare that, to the best of my knowledge and belief, during the year ended 31 December 2022 there have been: — no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and — no contraventions of any applicable code of professional conduct in relation to the audit. William Buck Audit (Vic) Pty Ltd ABN: 59 116 151 136 J.C. Luckins Director Melbourne, 9th March 2023 Level 20, 181 William Street, Melbourne VIC 3000 +61 3 9824 8555 vic.info@williambuck.com williambuck.com.au William Buck is an association of firms, each trading under the name of William Buck across Australia and New Zealand with affiliated offices worldwide. Liability limited by a scheme approved under Professional Standards Legislation. Auric Mining Limited and CONTROLLED ENTITIES Consolidated statements of profit or loss and other comprehensive income For the year ended 31 December 2022 Revenue Interest received Expenses Employee benefits expense Consultants, Corporate Advisory & Publicity Depreciation and amortisation expense Insurance Accounting fees Audit fees Legal fees Subscription, Software & Conference ASIC, ASX & Share registry Director Fees Rent Other expenses Loss before income tax expense Income tax expense Loss after income tax expense for the year attributable to the owners of Auric Mining Limited Other comprehensive income for the year, net of tax Total comprehensive income for the year attributable to the owners of Auric Mining Limited Note Consolidated 2022 $ 2021 $ 8,037 13,998 (439,010) (196,718) (37,056) (48,316) (16,170) (39,215) (50,475) (57,034) (94,119) (48,000) (13,975) (74,641) (474,992) (197,915) (16,933) (32,930) (46,375) (39,500) (28,986) (53,105) (68,486) (48,000) (16,000) (93,902) (1,106,692) (1,103,126) 4 - - (1,106,692) (1,103,126) - - (1,106,692) (1,103,126) Cents Cents Basic earnings per share Diluted earnings per share 20 20 (1.10) (1.10) (1.32) (1.32) The above consolidated statements of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes 14 Auric Mining Limited and CONTROLLED ENTITIES Consolidated statements of financial position As at 31 December 2022 Assets Current assets Cash and cash equivalents Other receivables Term Deposits Other Total current assets Non-current assets Property, plant and equipment Right-of-use assets Exploration and evaluation Other Total non-current assets Total assets Liabilities Current liabilities Trade and other payables Employee Benefits Lease Liability Total current liabilities Non-current liabilities Employee benefits Lease Liability Total non-current liabilities Total liabilities Net assets Equity Issued capital Share Option Reserve Accumulated losses Total equity Note Consolidated 2022 $ 2021 $ 5 6 7 8 817,524 78,940 1,200,000 225,639 2,322,103 545,007 35,850 2,020,000 68,057 2,668,914 29,113 109,931 8,537,814 9,249 8,686,107 29,569 134,363 6,529,640 8,878 6,702,450 11,008,210 9,371,364 222,761 80,099 22,410 325,270 85,532 92,135 20,653 198,320 22,738 93,723 116,461 9,035 116,133 125,168 441,731 323,488 10,566,479 9,047,876 9 10 12,856,302 10,244,807 657,066 (1,853,997) 670,866 (2,960,689) 10,566,479 9,047,876 The above consolidated statements of financial position should be read in conjunction with the accompanying notes 15 Auric Mining Limited and CONTROLLED ENTITIES Consolidated statements of changes in equity For the year ended 31 December 2022 Note Issued Capital $ Option Reserve $ Accumulated Losses $ Total $ Balance at 1 January 2022 10,244,807 657,066 (1,853,997) 9,047,876 Loss for the year ended 31 December 2022 Total comprehensive loss for the year Transactions with owners, directly in equity Shares issued Transaction costs Option reserve - - 9 2,780,200 (168,705) - - - - 10 - 13,800 (1,106,692) (1,106,692) (1,106,692) (1,106,692) - - - 2,780,200 (168,705) 13,800 Balance at 31 December 2022 12,856,302 670,866 (2,960,689) 10,566,479 Balance at 1 January 2021 Loss for the year ended 31 December 2021 Total comprehensive loss for the year Transactions with owners, directly in equity Shares issued Transaction costs Option reserve Note Issued Capital $ 3,098,256 - - 9 7,956,417 (809,866) 10 - 320,000 Option Reserve $ 337,066 Accumulated Losses $ Total $ (750,871) 2,684,451 - - - - (1,103,126) (1,103,126) (1,103,126) (1,103,126) - - - 7,956,417 (809,866) 320,000 Balance at 31 December 2021 10,244,807 657,066 (1,853,997) 9,047,876 The above consolidated statements of changes in equity should be read in conjunction with the accompanying notes 16 Auric Mining Limited and CONTROLLED ENTITIES Consolidated statements of cash flows For the year ended 31 December 2022 Cash flows from operating activities Payments to suppliers and employees (inclusive of GST) (1,060,549) (1,403,595) Net cash used in operating activities 19 (1,060,549) (1,403,595) Note Consolidated 2022 $ 2021 $ Cash flows from investing activities Payments for property, plant and equipment Payments for exploration and evaluation Receipts/(Payments) for term deposits Net cash used in investing activities Cash flows from financing activities Proceeds from issue of shares Capital raising costs Repayment of lease liabilities Net cash from financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the financial year Cash and cash equivalents at the end of the financial year (20,138) (2,059,411) 819,629 (26,997) (2,802,827) (2,028,878) (1,259,920) (4,858,702) 9 2,780,200 (164,805) (22,409) 7,256,417 (615,738) (9,793) 2,592,986 6,630,886 272,517 545,007 368,589 176,418 817,524 545,007 The above consolidated statements of cash flows should be read in conjunction with the accompanying notes 17 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 The consolidated financial statements and notes represent those of Auric Mining Limited and CONTROLLED ENTITIES (the Consolidated Group or Group). The financial statements were authorised for issue on 9 March 2023 by the Directors of the Company. Note 1. Significant Accounting Policies The principal accounting policies adopted in the preparation of the financial statements are set out either in the respective notes or below. These policies have been consistently applied to all the years presented, unless otherwise stated. New or amended Accounting Standards and Interpretations adopted The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (‘AASB’) that are mandatory for the current reporting year. The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the consolidated entity. Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted. Basis of Preparation These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate for for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board ('IASB'). Except for cash flow information, the financial statements have been prepared on an accrual basis and are based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities. Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report containing relevant and reliable information about the transactions, events and conditions to which they apply. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting Standards. Material accounting policies adopted in the preparation of this financial report are presented below. They have been consistently applied unless otherwise stated. Going Concern The consolidated financial statements have been prepared on a going concern basis which contemplates the continuity of normal business activities and the realisation of assets and the payment of liabilities in the ordinary course of business. The Group has incurred a net loss after tax for the year ended 31 December 2022 of $1,106,692, a net cash outflow from operations of $1,060,549 and net cash used in investing activities, excluding redemption of the term deposits of $2,079,549. As at 31 December 2022, the Group had net equity of $10,566,479 and cash and term deposits of $2,017,524. There is a material uncertainty that the Group will be able to continue as a going concern and therefore it may be unable to realise its assets and discharge its liabilities in the normal course of business. The Group’s ability to continue as a going concern and pay its debts as and when they fall due is dependent upon a combination of the following: - - - - the Group raising additional equity capital via any means available to it inclusive of, but not limited to, share placements, right issues, or joint venture arrangements in a timely manner in order to fund the ongoing exploration and operation activities of the Group; or the Group realising cash from the mining of the Jeffreys Find Deposit; or the Group delaying exploration activities if sufficient funds are not raised; or the Group selling some of the tenements if sufficient funds are not raised. 18 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) Although it is not certain that these efforts will be successful, management has determined that the activities it will take are sufficient to mitigate the material uncertainty on the entity’s ability to continue as a going concern and be able to discharge its liabilities in the normal course of business. The Directors have reviewed the Business outlook and cash flow forecasts after taking into account the above matters and are of the view that the use of going concern basis accounting is appropriate as the Directors believe the Group will achieve the matters set out above and be able to pay its debts as and when they fall due. The financial statements are normally prepared on the assumption that the Group is a going concern and will continue in operation for the foreseeable future. Hence, it is assumed that the Group has neither the intention nor the need to liquidate or curtail materially the scale of its operations. If such an intention or need exists, the financial statements may have to be prepared on a different basis and, if so, the basis will be disclosed and the impacts quantified. a. Principles of Consolidation The consolidated financial statements incorporate all of the assets, liabilities and results of the Parent (Auric Mining Limited) and all of the subsidiaries (including any structured entities). Subsidiaries are entities the Parent controls. The Parent controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. A list of the subsidiaries is provided in Note 17. The assets, liabilities and results of all subsidiaries are fully consolidated into the financial statements of the Group from the date on which control is obtained by the Group. The consolidation of a subsidiary is discontinued from the date that control ceases. Intercompany transactions, balances and unrealised gains or losses on transactions between Group entities are fully eliminated on consolidation. Accounting policies of subsidiaries have been changed and adjustments made where necessary to ensure uniformity of the accounting policies adopted by the Group. Equity interests in a subsidiary not attributable, directly or indirectly, to the Group are presented as "non-controlling interests". The Group initially recognises non-controlling interests that are present ownership interests in subsidiaries and are entitled to a proportionate share of the subsidiary’s net assets on liquidation at either fair value or the non- controlling interests’ proportionate share of the subsidiary’s net assets. Subsequent to initial recognition, non- controlling interests are attributed their share of profit or loss and each component of other comprehensive income. Non-controlling interests are shown separately within the equity section of the statement of financial position and statement of comprehensive income. Business combinations Business combinations occur where an acquirer obtains control over one or more businesses. A business combination is accounted for by applying the acquisition method, unless it is a combination involving entities or businesses under common control. The business combination will be accounted for from the date that control is obtained, whereby the fair value of the identifiable assets acquired and liabilities (including contingent liabilities) assumed is recognised (subject to certain limited exemptions). When measuring the consideration transferred in the business combination, any asset or liability resulting from a contingent consideration arrangement is also included. Subsequent to initial recognition, contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity. Contingent consideration classified as an asset or liability is remeasured in each reporting year to fair value, recognising any change to fair value in profit or loss, unless the change in value can be identified as existing at acquisition date. All transaction costs incurred in relation to business combinations, other than those associated with the issue of a financial instrument, are recognised as expenses in profit or loss when incurred. The acquisition of a business may result in the recognition of goodwill or a gain from a bargain purchase. 19 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) b. Income Tax The income tax expense for the year comprises current income tax expense and deferred tax expense. Current income tax expense charged to profit or loss is the tax payable on taxable income for the current year. Current tax liabilities (assets) are measured at the amounts expected to be paid to (recovered from) the relevant taxation authority using tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting year. Deferred tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year as well as unused tax losses. Current and deferred income tax expense (income) is charged or credited outside profit or loss when the tax relates to items that are recognised outside profit or loss or arising from a business combination. A deferred tax liability shall be recognised for all taxable temporary differences, except to the extent that the deferred tax liability arises from: (a) the initial recognition of goodwill; or (b) the initial recognition of an asset or liability in a transaction which: (i) is not a business combination; and (ii) at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss). Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled and their measurement also reflects the manner in which management expects to recover or settle the carrying amount of the related asset or liability. Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is probable that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised, unless the deferred tax asset relating to temporary differences arises from the initial recognition of an asset or liability in a transaction that: – – is not a business combination; and at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss). Where temporary differences exist in relation to investments in subsidiaries, branches, associates and joint ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference can be controlled and it is not probable that the reversal will occur in the foreseeable future. Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are offset where: (i) a legally enforceable right of set-off exists; and (ii) the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur in future years in which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled. c. Fair Value of Assets and Liabilities The Group measures some of its assets and liabilities at fair value on either a recurring or non-recurring basis, depending on the requirements of the applicable Australian Accounting Standard. Fair value is the price the Group would receive to sell an asset or would have to pay to transfer a liability in an orderly (i.e., unforced) transaction between independent, knowledgeable and willing market participants at the measurement date. As fair value is a market-based measure, the closest equivalent observable market pricing information is used to determine fair value. Adjustments to market values may be made having regard to the characteristics of the specific asset or liability. The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation techniques. These valuation techniques maximise, to the extent possible, the use of observable market data. To the extent possible, market information is extracted from either the principal market for the asset or liability (i.e., the market with the greatest volume and level of activity for the asset or liability) or, in the absence of such a market, the most advantageous market available to the entity at the end of the reporting year (i.e., the market that maximises the receipts from the sale of the asset or minimises the payments made to transfer the liability, after taking into account transaction costs and transport costs). For non-financial assets, the fair value measurement also takes into account a market participant’s ability to use the 20 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) asset in its highest and best use or to sell it to another market participant that would use the asset in its highest and best use. The fair value of liabilities and the entity’s own equity instruments (excluding those related to share-based payment arrangements) may be valued, where there is no observable market price in relation to the transfer of such financial instruments, by reference to observable market information where such instruments are held as assets. Where this information is not available, other valuation techniques are adopted and, where significant, are detailed in the respective note to the financial statements. d. Plant and Equipment Each class of plant and equipment is carried at cost or fair value as indicated less, where applicable, any accumulated depreciation and impairment losses. Plant and equipment Plant and equipment are measured on the cost basis and therefore carried at cost less accumulated depreciation and any accumulated impairment. In the event the carrying amount of plant and equipment is greater than the estimated recoverable amount, the carrying amount is written down immediately to the estimated recoverable amount and impairment losses are recognised in profit or loss. A formal assessment of recoverable amount is made when impairment indicators are present (refer to Note 1(g) for details of impairment). The carrying amount of plant and equipment is reviewed annually by Directors to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the asset’s employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts. The cost of fixed assets constructed within the Consolidated Group includes the cost of materials, direct labour, borrowing costs and an appropriate proportion of fixed and variable overheads. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are recognised as expenses in profit or loss during the financial year in which they are incurred. Depreciation The depreciable amount of all fixed assets including buildings and capitalised leased assets, is depreciated on a straight-line basis over the asset’s useful life to the Consolidated Group commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired year of the lease or the estimated useful lives of the improvements. The depreciation rates used for office equipment is 66.67% diminishing value. The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting year. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are recognised in profit or loss in the year in which they arise. Gains shall not be classified as revenue. When revalued assets are sold, amounts included in the revaluation surplus relating to that asset are transferred to retained earnings. e. Exploration and Evaluation Costs Exploration, evaluation and development expenditures incurred are capitalised in respect of each identifiable area of interest. These costs are only capitalised to the extent that they are expected to be recovered through the successful development of the area or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves. Accumulated costs in relation to an abandoned area are written off in full against profit or loss in the year in which the decision to abandon the area is made. When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the area according to the rate of depletion of the economically recoverable reserves. 21 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) A regular review is undertaken of each area of interest to determine the appropriateness of continuing to capitalise costs in relation to that area. f. Financial Instruments Initial recognition and measurement Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions to the instrument. For financial assets, this is the date that the Group commits itself to either the purchase or sale of the asset (i.e., trade date accounting is adopted). Financial instruments (except for trade receivables) are initially measured at fair value plus transaction costs, except where the instrument is classified "at fair value through profit or loss", in which case transaction costs are expensed to profit or loss immediately. Where available, quoted prices in an active market are used to determine fair value. In other circumstances, valuation techniques are adopted. Trade receivables are initially measured at the transaction price if the trade receivables do not contain a significant financing component or if the practical expedient was applied as specified in AASB 15: Revenue from Contracts with Customers Classification and subsequent measurement Financial liabilities Financial instruments are subsequently measured at: – – amortised cost; or fair value through profit or loss. A financial liability is measured at fair value through profit and loss if the financial liability is: – – – a contingent consideration of an acquirer in a business combination to which AASB 3: Business Combinations applies; held for trading; or initially designated as at fair value through profit or loss. All other financial liabilities are subsequently measured at amortised cost using the effective interest method. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest expense in profit or loss over the relevant year. The effective interest rate is the internal rate of return of the financial asset or liability. That is, it is the rate that exactly discounts the estimated future cash flows through the expected life of the instrument to the net carrying amount at initial recognition. A financial liability is held for trading if: – – – it is incurred for the purpose of repurchasing or repaying in the near term; part of a portfolio where there is an actual pattern of short-term profit taking; or a derivative financial instrument (except for a derivative that is in a financial guarantee contract or a derivative that is in an effective hedging relationships). Any gains or losses arising on changes in fair value are recognised in profit or loss to the extent that they are not part of a designated hedging relationship are recognised in profit or loss. The change in fair value of the financial liability attributable to changes in the issuer's credit risk is taken to other comprehensive income and are not subsequently reclassified to profit or loss. Instead, they are transferred to retained earnings upon derecognition of the financial liability. If taking the change in credit risk in other comprehensive income enlarges or creates an accounting mismatch, then these gains or losses should be taken to profit or loss rather than other comprehensive income. A financial liability cannot be reclassified. Financial assets 22 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) Financial assets are subsequently measured at: – – – amortised cost; fair value through other comprehensive income; or fair value through profit or loss. Measurement is on the basis of two primary criteria: – – the contractual cash flow characteristics of the financial asset; and the business model for managing the financial assets. A financial asset that meets the following conditions is subsequently measured at amortised cost: – – the financial asset is managed solely to collect contractual cash flows; and the contractual terms within the financial asset give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding on specified dates. A financial asset that meets the following conditions is subsequently measured at fair value through other comprehensive income: – – the contractual terms within the financial asset give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding on specified dates; the business model for managing the financial assets comprises both contractual cash flows collection and the selling of the financial asset. By default, all other financial assets that do not meet the measurement conditions of amortised cost and fair value through other comprehensive income are subsequently measured at fair value through profit or loss. The Group initially designates a financial instrument as measured at fair value through profit or loss if: – – – it eliminates or significantly reduces a measurement or recognition inconsistency (often referred to as "accounting mismatch") that would otherwise arise from measuring assets or liabilities or recognising the gains and losses on them on different bases; it is in accordance with the documented risk management or investment strategy, and information about the groupings was documented appropriately, so that the performance of the financial liability that was part of a group of financial liabilities or financial assets can be managed and evaluated consistently on a fair value basis; it is a hybrid contract that contains an embedded derivative that significantly modifies the cash flows otherwise required by the contract. The initial designation of the financial instruments to measure at fair value through profit or loss is a one-time option on initial classification and is irrevocable until the financial asset is derecognised. Equity instruments At initial recognition, as long as the equity instrument is not held for trading and not a contingent consideration recognised by an acquirer in a business combination to which AASB 3: Business Combinations applies, the Group may make an irrevocable election to measure any subsequent changes in fair value of the equity instruments in other comprehensive income, while the dividend revenue received on underlying equity instruments investment will still be recognised in profit or loss. Regular way purchases and sales of financial assets are recognised and derecognised at settlement date in accordance with the Group's accounting policy. Derecognition Derecognition refers to the removal of a previously recognised financial asset or financial liability from the statement of financial position. Derecognition of financial liabilities A liability is derecognised when it is extinguished (i.e., when the obligation in the contract is discharged, cancelled or 23 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) expires). An exchange of an existing financial liability for a new one with substantially modified terms, or a substantial modification to the terms of a financial liability is treated as an extinguishment of the existing liability and recognition of a new financial liability. The difference between the carrying amount of the financial liability derecognised and the consideration paid and payable, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss. Derecognition of financial assets A financial asset is derecognised when the holder's contractual rights to its cash flows expires, or the asset is transferred in such a way that all the risks and rewards of ownership are substantially transferred. All of the following criteria need to be satisfied for derecognition of financial asset: – – – the right to receive cash flows from the asset has expired or been transferred; all risk and rewards of ownership of the asset have been substantially transferred; and the Group no longer controls the asset (i.e., the Group has no practical ability to make a unilateral decision to sell the asset to a third party). On derecognition of a financial asset measured at amortised cost, the difference between the asset's carrying amount and the sum of the consideration received and receivable is recognised in profit or loss. On derecognition of a debt instrument classified as at fair value through other comprehensive income, the cumulative gain or loss previously accumulated in the investment revaluation reserve is reclassified to profit or loss. On derecognition of an investment in equity which was elected to be classified under fair value through other comprehensive income, the cumulative gain or loss previously accumulated in the investment revaluation reserve is not reclassified to profit or loss but is transferred to retained earnings. Impairment The Group recognises a loss allowance for expected credit losses on: – – – – – financial assets that are measured at amortised cost or fair value through other comprehensive income; lease receivables; contract assets (e.g., amounts due from customers under construction contracts); loan commitments that are not measured at fair value through profit or loss; and financial guarantee contracts that are not measured at fair value through profit or loss. Loss allowance is not recognised for: – – financial assets measured at fair value through profit or loss; or equity instruments measured at fair value through other comprehensive income. Expected credit losses are the probability-weighted estimate of credit losses over the expected life of a financial instrument. A credit loss is the difference between all contractual cash flows that are due and all cash flows expected to be received, all discounted at the original effective interest rate of the financial instrument. The Group uses the following approaches to impairment, as applicable under AASB 9: Financial Instruments: – – – – the general approach; the simplified approach; the purchased or originated credit-impaired approach; and low credit risk operational simplification. General approach Under the general approach, at each reporting year, the Group assesses whether the financial instruments are credit- impaired, and if: – the credit risk of the financial instrument has increased significantly since initial recognition, the Group 24 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) measures the loss allowance of the financial instruments at an amount equal to the lifetime expected credit losses; or – there is no significant increase in credit risk since initial recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month expected credit losses. Simplified approach The simplified approach does not require tracking of changes in credit risk at every reporting year, but instead requires the recognition of lifetime expected credit loss at all times. This approach is applicable to: – – trade receivables or contract assets that result from transactions within the scope of AASB 15: Revenue from Contracts with Customers and which do not contain a significant financing component; and lease receivables. In measuring the expected credit loss, a provision matrix for trade receivables was used taking into consideration various data to get to an expected credit loss (i.e., diversity of customer base, appropriate groupings of historical loss experience, etc). Recognition of expected credit losses in financial statements At each reporting date, the Group recognises the movement in the loss allowance as an impairment gain or loss in the statement of profit or loss and other comprehensive income. The carrying amount of financial assets measured at amortised cost includes the loss allowance relating to that asset. Assets measured at fair value through other comprehensive income are recognised at fair value, with changes in fair value recognised in other comprehensive income. Amounts in relation to change in credit risk are transferred from other comprehensive income to profit or loss at every reporting year. For financial assets that are unrecognised (e.g., loan commitments yet to be drawn, financial guarantees), a provision for loss allowance is created in the statement of financial position to recognise the loss allowance. g. Impairment of Non-Financial Assets At the end of each reporting year, the Group assesses whether there is any indication that an asset may be impaired. The assessment will include the consideration of external and internal sources of information, including dividends received from subsidiaries. If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the asset, being the higher of the asset’s fair value less costs of disposal and value in use, to the asset’s carrying amount. Any excess of the asset’s carrying amount over its recoverable amount is recognised immediately in profit or loss, unless the asset is carried at a revalued amount in accordance with another Standard (e.g., in accordance with the revaluation model in AASB 116: Property, Plant and Equipment). Any impairment loss of a revalued asset is treated as a revaluation decrease in accordance with that other Standard. Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Impairment testing is performed annually for goodwill, intangible assets with indefinite lives and intangible assets not yet available for use. When an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so 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 (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase. h. Employee Benefits Short-term employee benefits Provision is made for the Group’s obligation for short-term employee benefits. Short-term employee benefits are benefits (other than termination benefits) that are expected to be settled wholly before 12 months after the end of the annual reporting year in which the employees render the related service, including wages, salaries and sick leave. Short-term employee benefits are measured at the (undiscounted) amounts expected to be paid when the obligation is settled. 25 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) The Group’s obligations for short-term employee benefits such as wages, salaries and sick leave are recognised as part of current trade and other payables in the statement of financial position. The Group’s obligations for employees’ annual leave and long service leave entitlements are recognised as provisions in the statement of financial position. Other long-term employee benefits Provision is made for employees’ long service leave and annual leave entitlements not expected to be settled wholly within 12 months after the end of the annual reporting year in which the employees render the related service. Other long-term employee benefits are measured at the present value of the expected future payments to be made to employees. Expected future payments incorporate anticipated future wage and salary levels, durations of service and employee departures and are discounted at rates determined by reference to market yields at the end of the reporting year on government bonds that have maturity dates that approximate the terms of the obligations. Any remeasurements for changes in assumptions of obligations for other long-term employee benefits are recognised in profit or loss in the years in which the changes occur. The Group’s obligations for long-term employee benefits are presented as non-current provisions in its statement of financial position, except where the Group does not have an unconditional right to defer settlement for at least 12 months after the end of the reporting year, in which case the obligations are presented as current provisions. Defined contribution superannuation benefits All employees of the Group other than those who receive defined benefit entitlements receive defined contribution superannuation entitlements, for which the Group pays the fixed superannuation guarantee contribution (currently 10.5% of the employee’s average ordinary salary) to the employee’s superannuation fund of choice. All contributions in respect of employees’ defined contribution entitlements are recognised as an expense when they become payable. The Group’s obligation with respect to employees’ defined contribution entitlements is limited to its obligation for any unpaid superannuation guarantee contributions at the end of the reporting year. All obligations for unpaid superannuation guarantee contributions are measured at the (undiscounted) amounts expected to be paid when the obligation is settled and are presented as current liabilities in the Group’s statement of financial position. Termination benefits When applicable, the Group recognises a liability and expense for termination benefits at the earlier of: – – the date when the Group can no longer withdraw the offer for termination benefits; and when the Group recognises costs for restructuring pursuant to AASB 137: Provisions, Contingent Liabilities and Contingent Assets and the costs include termination benefits. In either case, unless the number of employees affected is known, the obligation for termination benefits is measured on the basis of the number of employees expected to be affected. Termination benefits that are expected to be settled wholly before 12 months after the annual reporting year in which the benefits are recognised are measured at the (undiscounted) amounts expected to be paid. All other termination benefits are accounted for on the same basis as other long-term employee benefits. i. Provisions Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured. Provisions are measured using the best estimate of the amounts required to settle the obligation at the end of the reporting year. j. Cash and Cash Equivalents Cash and cash equivalents include cash on hand, deposits available on demand with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are reported within borrowings in current liabilities on the statement of financial position. k. Goods and Services Tax (GST) Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to, the ATO are presented as operating cash flows included in receipts from customers or payments to suppliers. 26 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office (ATO). Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the ATO is included with other receivables or payables in the statement of financial position. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to, the ATO are presented as operating cash flows included in receipts from customers or payments to suppliers. l. Critical Accounting Estimates and Judgements The Directors evaluate estimates and judgements incorporated into the financial statements based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Group. m. Key Judgements Exploration and evaluation expenditure The Group capitalises expenditure relating to exploration and evaluation where it is considered likely to be recoverable or where the activities have not reached a stage that permits a reasonable assessment of the existence of reserves. While there are certain areas of interest from which no reserves have been extracted, the Directors are of the continued belief that such expenditure should not be written off since feasibility studies in such areas have not yet concluded. Such capitalised expenditure is carried at the end of the reporting year at $8.54 million. n. Share-based Payment Transactions The consolidated entity 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 is determined by using either Hoadley’s Binomial model or the Black-Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting year but may impact profit or loss and equity. o. Right-of-Use-Asset A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset. Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter. Where the  consolidated entity  expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities. The  consolidated entity  has elected not to recognise a right-of-use asset and corresponding lease liability for short- term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as incurred. p. Lease Liabilities A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the company's incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred. Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are 27 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 1. Significant Accounting Policies (continued) remeasured if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset is fully written down. Note 2. Parent Information The following information has been extracted from the books and records of the financial information of the Parent Entity set out below and has been prepared in accordance with Australian Accounting Standards. Loss Other comprehensive income for the period TOTAL COMPREHENSIVE LOSS Current assets Non-current assets TOTAL ASSETS Current liabilities Non-current liabilities TOTAL LIABILITIES NET EQUITY Issued capital Accumulated losses Share option reserve TOTAL EQUITY Consolidated 2022 $ 2021 $ (1,101,901) - (1,101,901) (1,094,173) - (1,094,173) Consolidated 2022 $ 2021 $ 2,162,976 8,803,613 10,966,589 616,647 8,762,578 9,379,225 266,346 116,462 382,808 10,583,781 193,670 125,168 318,838 9,060,387 12,856,302 10,244,807 (1,841,486) 657,066 9,060,387 (2,943,387) 670,866 10,583,781 The Parent entity has guaranteed the contingent asset and liabilities as detailed in note 13 and has also guaranteed the obligation to Neometals Limited as detailed in note 14. Note 3. Operating segments Identification of reportable operating segments For management’s purposes, the Group is organised into one main operating segment, which involves the exploration and development of minerals in Australia. All of the Group’s activities are interrelated, and discrete financial information is reported to the Board as a single segment. Accordingly, all significant decisions are based upon analysis of the Group as one segment. The financial results from this segment are equivalent to the financial statements of the Group as a whole. 28 Auric Mining Limited AND CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 4. Income tax Numerical reconciliation of income tax benefit and tax at the statutory rate Loss before income tax expense Tax at the statutory tax rate of 25% (2021: 26%) Tax effect amounts which are not deductible/(taxable) in calculating taxable income: Non-allowable items Other items Carry forward tax losses not recognised DTA/DTL not recognised Income tax benefit Note 5. Current assets – Term Deposits Term deposit 1 Term deposit 2 Term deposit 3 Term deposits 1 matures on 6 March 2023. Term deposits 2 matures on 6 June 2023. Term deposits 3 matures on 6 September 2023. Note 6. Non-current assets - exploration and evaluation Exploration and evaluation - at cost Consolidated 2022 $ 2021 $ (1,106,692) (1,103,126) (276,673) (286,813) 42,293 (157,933) (408,871) 801,184 37,929 (176,342) (108,482) 533,708 - - Consolidated 2022 $ 2021 $ 500,000 500,000 200,000 20,000 1,000,000 1,000,000 1,200,000 2,020,000 Consolidated 2022 $ 2021 $ 8,537,814 6,529,640 Reconciliations Reconciliations of the cost at the beginning and end of the current and previous financial year are set out below: Opening balance Expenditure during the year Closing balance Consolidated 2022 $ 2021 $ 6,529,640 2,008,174 3,830,614 2,699,026 8,537,814 6,529,640 All exploration and evaluation expenditure including general activities, geological, project generation, tenement acquisition and drilling costs are capitalised as incurred. 29 Auric Mining Limited AND CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 7. Current liabilities - trade and other payables Trade and other payables Accruals Note 8. Current liabilities - Employee Benefits Annual leave Superannuation payable PAYG payable Note 9. Equity - Issued capital Opening balance Shares issued via IPO Shares issued to NMT re Gold Rights Shares issued to John Williams Shares issued via Placement Shares issued via SPP Less capital raising costs Consolidated 2022 $ 2021 $ 161,491 61,270 26,402 59,130 222,761 85,532 Consolidated 2022 $ 2021 $ 59,741 - 20,358 28,742 5,575 57,818 80,099 92,135 2022 Shares Consolidated 2022 $ 2021 Shares 2021 $ 93,084,325 10,244,807 60,628,967 - 29,025,667 3,429,691 - - 400,000 - 1,130,200 1,250,000 - - (168,705) - - 4,716,981 15,697,224 17,361,061 - 3,098,256 7,256,417 700,000 - - - (809,866) Closing balance 130,859,591 12,856,302 93,084,325 10,244,807 Ordinary shares Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company does not have a limited amount of authorised capital. On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. Share buy-back There is no current on-market share buy-back. Capital risk management The consolidated entity's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital. Capital is regarded as total equity, as recognised in the statement of financial position. In order to maintain or adjust the capital structure, the consolidated entity may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets. 30 Auric Mining Limited AND CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 9. Equity - Issued capital (continued) The consolidated entity would look to raise capital when an opportunity to invest in a business or company was seen as value adding relative to the current Company's share price at the time of the investment. The capital risk management policy remains unchanged from the 31 December 2021 Annual Report. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction from the proceeds. Note 10. Equity - Share Option Reserve A total of 900,000 options have been issued to two employees of the Company in accordance with the Company's 'Employee Securities Incentive Plan'. A total of 300,000 options have been issued to Lazarus Capital (Vic) Pty Ltd as part of their corporate advisory services provided to the Company. Both options had the following assumptions: The options were valued by PKF Melbourne using the Hoadley’s Binomial Model to value the Employee Options. The Black Scholes method has been used to value the Lazarus Options. The assumptions used are as follows: Stock price $0.076 Volatility 80% Exercise price $0.15 Risk free rate 3.070% Grant date 16/12/2022 Fair value per option $0.011 (900,000 options) Expiry date 31/03/2024 Fair value per option $0.013 (300,000 options) Share option reserve $13,800 Opening balance Value of options issued during the year Closing balance Consolidated 2022 $ 2021 $ 657,066 13,800 337,066 320,000 670,866 657,066 Listed Options Expiring 31/10/2023 @ $0.40 Consolidated Opening balance Options reissued 29 January 2021 Issued as per IPO Issued for capital raising services 2022 No 2022 $ 2021 No 2021 $ 43,908,175 - - - 657,066 - - 26,895,341 - 14,512,834 2,500,000 - 337,066 - - 320,000 Closing Balance 43,908,175 657,066 43,908,175 657,066 Listed Options Expiring 31/03/2024 @ $0.15 Consolidated 2022 No 2022 $ 2021 No 2021 $ Opening balance Issued as per Placement Issued as per SPP Issued for capital raising services Issued under Employee Incentives Securities Plan Closing Balance Total - - - 3,900 9,900 13,800 - - - - - - - - - - 670,866 43,908,175 657,066 - 7,848,612 8,680,523 300,000 900,000 17,729,135 61,637,310 31 Auric Mining Limited AND CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 10. Equity - Share Option Reserve (continued) The weighted average exercise price for option expiring 31 October 2023 is $0.40 per option. the same in prior year and the current year. The remaining contractual life of options outstanding at the end of the financial year was 8 months. (31 December 2021: 1.8 years) The weighted average exercise price for option expiring 31 March 2024 is $0.15 per option. The remaining contractual life of options outstanding at the end of the financial year was 1.3 years. (31 December 2021: Nil) As at 31 December 2022, all options are exercisable as at the year end. (2021: all options are exercisable at year end) Note 11. Key management personnel disclosures 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) or their related parties for the year ended 31 December 2022. The total of remuneration paid to KMP of the Company and the Group during the year are as follows: Short-term employee benefits Post-employment benefits Long-term benefits Short-term benefits Consolidated 2022 $ 2021 $ 510,545 49,970 9,139 567,849 51,888 9,035 569,654 628,772 These amounts include fees and benefits paid to non-executive Directors or their related parties as well as all salary and paid leave benefits awarded to executive Directors. Post-employment benefits These amounts are the current-year’s estimated costs of providing for the Group’s defined benefits scheme post-retirement, superannuation contributions made during the period. Other long-term benefits These amounts represent long service leave benefits accruing during the period. Note 12. Auditor's Remuneration During the financial year the following fees were paid or payable for services provided by William Buck, the auditor of the Company: Audit services - William Buck Audit or review of the financial statements Consolidated 2022 $ 2021 $ 36,727 39,500 32 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 13. Contingent Assets and Liabilities As part of the terms and conditions of the acquisition of Spargoville Project, the Group has contingent liabilities amounting to $150,000 worth of ordinary shares to be issued, subject to performance milestones being achieved, at a deemed issue price per share equal to the VWAP of shares calculated over the 5 trading days immediately preceding the date of issue of the shares. As part of the acquisition of the Spargoville Project, the Group has taken on the obligation to Breakaway Resources Pty Ltd to a 1.5% net smelter royalty in respect of production from the tenements. As part of the acquisition of the Neometals gold rights, the Group has taken on the obligation to Neometals Ltd to a 1% gross royalty in respect of gold production from Tenement E15/1583. The Company entered into an option agreement to acquire all the issued capital of Mineral Business Development Pty Ltd. Settlement of the option agreement was dependent on tenement E15/1801 being granted. The cash amount of $275,000 was paid prior to 30 June 2022. Tenement E15/1801 was granted on 1 July 2022 and accordingly 4,716,981 shares at an issue price of $0.0848 were issued and allotted on 13 July 2022. As part of the acquisition of the Chalice West Project, the Group has taken on the obligation to pay Mr and Mrs. Williams $225,000 in cash or 2,250,000 shares (subject to purchaser's shareholders’ approval) to extend the option for second year, if the Company elects to continue. Payment method to be elected by Mr and Mrs. Williams. If the value of shares is the higher value but the Company are unable to obtain shareholder approval, the Company will pay the vendors the value of the 2,250,000 AWJ shares as a cash payment. The same obligation applies if the Company elects to continue for third year. At the end of the third year, if the Company proceeds to settlement, the Company will pay the vendors $2,250,000 cash or shares to the value of $2,250,000 (subject to purchaser's shareholders’ approval), or combination thereof, at the Company’s election, to buy the shares in Mineral Business Development Pty Ltd. As part of the acquisition of the Chalice West Project, the Group has taken on the obligation to Mr and Mrs. Williams to a 2% net smelter royalty on all mineral production from the tenements. Note 14. Commitments Tenement commitments: 0-1 year Tenement commitments: 1-5 years Tenement commitments: 5 years plus Consolidated 2022 $ 2021 $ 733,900 1,378,000 74,400 513,900 529,500 86,800 2,186,300 1,130,200 As part of the acquisition of the Neometals gold rights, the Group has taken on the obligation to spend $450,000 on the tenements in year 1 from settlement date and a further $450,000 in the second year. As part of the acquisition of the Chalice West Project, the Group has taken on the obligation to spend a minimum expenditure commitment of $200,000 on the Direct Drilling Activities on the tenements in year 1 from settlement date, a combined $500,000 by the end of year 2 and a combined $1,000,000 by the end of year 3. Note 15. Related party transactions a. Related Parties The Group's main related parties are related to Key Management Personnel, identified as follows: Steven Morris Mark English John Utley Stephen Strubel (retired 27 May 2022) 33 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 15. Related party transactions (continued) b. Transactions with related parties Transactions between than those available been disclosed in the Remuneration Report. related parties are on normal commercial terms and conditions no more favourable transactions with key management personnel have to other parties unless otherwise stated. All c. Amounts paid/ payable to related parties The following transactions occurred with related parties: Consolidated 2022 $ 2021 $ Targo Holdings Pty Ltd, entity related to Steven Morris for services rendered 48,000 48,000 Receivable from and payable to related parties There were no trade receivables from or trade payables to related parties at the current and previous reporting date. Loans to/from related parties There were no loans to or from related parties at the current and previous reporting date. Terms and conditions All transactions were made on normal commercial terms and conditions and at market rates. Note 16. Capital Commitments The Company has entered into a contract for the purchase of a Toyota Hilux for an amount up to $55,000. During to the financial year, the Company has submitted an offer to purchase a Crown Lease Property at Widgiemooltha for $25,000 Note 17. Interests in Subsidiaries a. Parents entities Auric Mining Limited is the ultimate Australian parent entity. b. Subsidiaries The subsidiaries listed below have share capital consisting solely of ordinary shares which are held directly by Auric. The proportion of ownership interests held equals the voting rights held by Auric. Each subsidiary’s principal place of business is also its country of incorporation. Name Widgie Gold Pty Ltd Spargoville Minerals Pty Ltd Jeffreys Find Pty Ltd Chalice West Pty Ltd Principal place of business / Country of incorporation Australia Australia Australia Australia Ownership interest 2021 2022 % % 100% 100% 100% 100% 100% 100% 100% - Subsidiary financial statements used in the preparation of these consolidated financial statements have also been prepared as at the same reporting date as the Group’s financial statements. 34 Auric Mining Limited AND CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 18. Events after the reporting period After the year ended 31 December 2022, the Company submitted 3 tenement applications to acquire P15/6786, E15/1978 and E15/1979. No other matter or circumstance has arisen since 31 December 2022 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years. Note 19. Cash flow information Reconciliation of loss after income tax to net cash used in operating activities Loss after income tax expense for the year (1,106,692) (1,103,126) Consolidated 2022 $ 2021 $ Change in operating assets and liabilities: Increase/(decrease) in trade and other payables Increase/(decrease) in other provisions Depreciation, amortisation and non cash salaries (Increase) in receivables and other current assets Net cash used in operating activities Note 20. Earnings per share 49,162 44,701 48,713 (96,433) (75,182) (210,223) 16,933 (31,997) (1,060,549) (1,403,595) Consolidated 2022 $ 2021 $ Loss after income tax attributable to the owners of Auric Mining Limited (1,106,692) (1,103,126) Basic earnings per share Diluted earnings per share Cents Cents (1.10) (1.10) (1.32) (1.32) Number Number Weighted average number of ordinary shares used in calculating basic earnings per share 100,446,241 83,599,875 Weighted average number of ordinary shares used in calculating diluted earnings per share 100,446,241 83,599,875 Accounting policy for earnings per share Basic earnings per share Basic earnings per share is calculated by dividing the profit attributable to the owners of Auric Mining Limited, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year. Diluted earnings per share Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares. Options have not been included as they are anti-dilutive. 35 Auric Mining Limited AND CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 21. Financial Risk Management The Group’s financial instruments consist mainly of deposits with banks, accounts receivable and payable. The totals for each category of financial instruments, measured in accordance with AASB 9: Financial Instruments as detailed in the accounting policies to these financial statements, are as follows: Financial assets Financial assets at amortised cost Cash and cash equivalents Other receivables Term deposits Other Total financial assets Financial liabilities Financial liabilities at amortised cost Other payables Financial Risk Management Policies Consolidated 2022 $ 2021 $ 817,524 78,940 1,200,000 225,639 545,007 35,850 2,020,000 68,057 2,322,103 2,668,914 Consolidated 2022 2021 441,732 323,488 The Board monitors the Group’s financial risk management policies and exposures and approves financial transactions within the scope of its authority. It also reviews the effectiveness of internal controls relating to commodity price risk, counterparty credit risk, foreign currency risk, liquidity risk and interest rate risk. The overall risk management strategy seeks to assist the Consolidated Group in meeting its financial targets, while minimising potential adverse effects on financial performance. Its functions include the review of the use of credit risk policies and future cash flow requirements. Specific financial risk exposures and management The main risks the Group is exposed to through its financial instruments are credit risk and liquidity risk. There are no substantive changes in the types of risks the Group is exposed to, how these risks arise, or the Board’s objectives, policies and processes for managing or measuring the risks. 36 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 21. Financial Risk Management (continued) a. Credit risk Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract obligations that could lead to a financial loss to the Group. Due to the current nature of the Group, being an exploration entity, the Group is not exposed to material credit risk. b. Liquidity risk Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise meeting its obligations related to financial liabilities. Ultimate responsibility for liquidity risk management rests with the Board of Directors, who have built an appropriate liquidity risk management framework for the management of the Group's short, medium and long-term funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves and by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. Typically, the Group ensures that it has sufficient cash to meet expected operational expenses for a period of 60 days. The financial liabilities of the Group include trade and other payables as disclosed in the statement of financial position. All trade and other payables are non-interest bearing and due within 30 days of the reporting date. The following table reflects an undiscounted contractual maturity analysis for financial assets and financial liabilities. Financial liability and financial asset maturity analysis Consolidated Group 2022 Financial liabilities due for payment Other payables Lease liability Total expected outflows Financial assets – cash flows realisable Cash and cash equivalents Other receivables Term Deposit Rental security bond Total anticipated inflows Within 1 Year 1 to 5 Years $ $ Total $ (222,761) (22,410) (245,171) - (93,724) (93,724) (222,761) (116,134) (338,895) 817,524 304,579 1,200,000 - 2,322,103 - - - 9,249 9,249 817,524 304,579 1,200,000 9,249 2,331,352 Net inflow on financial instruments 2,076,932 (84,475) 1,992,457 37 Auric Mining Limited and CONTROLLED ENTITIES Notes to the consolidated financial statements 31 December 2022 Note 21. Financial Risk Management (continued) Consolidated Group 2021 Financial liabilities due for payment Other payables Lease liability Total expected outflows Financial assets – cash flows realisable Cash and cash equivalents Other receivables Term Deposit Rental security bond Total anticipated inflows Within 1 Year 1 to 5 Years $ $ Total $ (85,532) (20,653) (106,185) - (116,133) (116,133) (85,532) (136,786) (222,318) 545,007 103,907 2,020,000 - 2,668,914 - - - 8,878 8,878 545,007 103,907 2,020,000 8,878 2,677,792 Net (outflow) on financial instruments 2,562,729 (107,255) 2,455,474 Fair value estimation The fair values of financial assets and financial liabilities are presented above and can be compared to their carrying values as presented in the statement of financial position. Fair values are those amounts at which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm's length transaction. Financial instruments whose carrying value is equivalent to fair value due to their nature include:  Cash and cash equivalents;  Other receivables; and  Other payables Note 22. Company Details The registered office and principal place of business of the Company is: Auric Mining Limited Suite 1, 1 Tully Road East Perth WA 6004 38 Auric Mining Limited and CONTROLLED ENTITIES Directors' declaration 31 December 2022 In the Directors' opinion: ● ● ● ● the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; the attached financial statements and notes comply with International Financial Reporting Standards as issued by the International Accounting Standards Board as described in note 1 to the financial statements; the attached financial statements and notes give a true and fair view of the Company's and consolidated entity's financial position as at 31 December 2022 and of their performance for the financial year ended on that date; and there are reasonable grounds to believe that the Company will be able to pay its debts when they become due and payable, as disclosed in note 1 of the financial statements. The Directors have been given the declarations required by section 295A of the Corporations Act 2001. Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations Act 2001. On behalf of the Directors ___________________________ Mark English Managing Director 9 March 2023 Perth WA 39 Auric Mining Limited Independent auditor’s report to members REPORT ON THE AUDIT OF THE FINANCIAL REPORT Opinion We have audited the financial report of Auric Mining Limited (the Company and its subsidiaries (the consolidated entity)), which comprises the consolidated statement of financial position as at 31 December 2022, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information, and the directors’ declaration. In our opinion, the accompanying financial report of the consolidated entity, is in accordance with the Corporations Act 2001, including: i. giving a true and fair view of the consolidated entity’s financial position as at 31 December 2022 and of its financial performance for the year ended on that date; and ii. complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the consolidated entity in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Material Uncertainty Related to Going Concern We draw attention to Note 1 to the financial report, which indicates that the consolidated entity incurred a net loss of $1,106,692 for the year ended 31 December 2022 and had net cash outflows from operations of $1,060,549 and net cash used in investing activities excluding redemption of term deposits of $2,079,549. As stated in Note 1, these events or conditions, indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter. Level 20, 181 William Street, Melbourne VIC 3000 +61 3 9824 8555 vic.info@williambuck.com williambuck.com.au William Buck is an association of firms, each trading under the name of William Buck across Australia and New Zealand with affiliated offices worldwide. Liability limited by a scheme approved under Professional Standards Legislation. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Related to Going Concern section, we have determined the matters described below to be the key audit matters to be communicated in our report. CAPITALISATION OF EXPLORATION AND EVALUATION COSTS Area of focus Refer also to notes 1 and 6 The consolidated entity has incurred exploration and evaluation costs for exploration projects in Australia of $2,008,174 for the year ended 31 December 2022 and has elected to capitalise all these costs as a non-current asset in the Statement of Financial Position in accordance with the consolidated entity accounting policies. There is a risk that the consolidated entity may lose or relinquish its rights to explore and evaluate those areas of interest and therefore amounts capitalised to the Statement of Financial Position from the current and historical periods, be no longer recoverable. Therefore, we considered this to be a key audit matter. During the year no impairment charge was recognised in relation to exploration and evaluation. How our audit addressed it Our audit procedures included the following: — Understanding and vouching the underlying contractual entitlement to explore and evaluate each area of interest, including an evaluation of the consolidated entity’s purchase in that area of interest at its expiry; — Examining project spend per each area of interest and comparing this spend to the minimum expenditure requirements set out in the underlying exploration expenditure plan; — Examining project spend to each area of interest to ensure that it is directly attributable to that area of interest; — From an overall perspective, comparing the market capitalisation of the consolidated entity to the net carrying value of its assets on the Statement of Financial Position to identify any other additional indicators of impairment; and — Assessing management’s position as to why no impairment charge is required despite the net carrying value of its assets on the Statement of Financial Position exceeding the market capitalisation of the consolidated entity. — Assessing the adequacy of the consolidated entity’s disclosures in the financial report. SHARE BASED PAYMENTS Area of focus Refer also to notes 1 and 10 The consolidated entity has incurred share-based payments expenses during the year as part of capital raising services and under its employee share plan during the year. There is a risk that the consolidated entity may not have valued these options appropriately and that the expense due to be recognised from these options issued during the year is incorrect. Therefore, we considered this to be a key audit matter. The options issued to employees were valued using a bi-nominal model whilst the options issued to advisors were valued using a black scholes model with all options vesting immediately, and the expense for the options fully recognised during the year. CAPITAL RAISING Area of focus Refer also to notes 1, 9 and 10 The consolidated entity raised capital during the year through 2 tranches, one being a placement of $1,130,200 before costs and one being through a share purchase plan of $1,250,000 before costs. Attaching options were issued as part of the capital raises completed and costs attributable to the capital raised have been recognised as costs of raising capital within equity. There is a risk that the consolidated entity may not have received the funds from the capital raise and issued the associated shares, that the attaching options have not been valued appropriately and costs not directly attributable to the raising of capital have been recognised within equity. Therefore, we considered this to be a key audit matter. How our audit addressed it Our audit procedures included the following: — Understanding the terms of the options being issued including the number of options issued, grant date, expiry date, exercise price and the presence of any market or non-market conditions; — Assessing the bi-nominal and black scholes models used by management’s expert to determine the valuation of the options and examining the key inputs used in the model; — Recalculating the expense recognised during the year in line with the terms of the options; and — Assessing the adequacy of the consolidated entity’s disclosures in the financial report. How our audit addressed it Our audit procedures included the following: — Agreeing the capital raised during the year to bank statement; — Assessing the fair value of the attaching options issued as part of the capital raises; — Assessing the costs associated to the capital raises being recognised during the year within equity; and — Assessing the adequacy of the consolidated entity’s disclosures in the financial report. Other Information The directors are responsible for the other information. The other information comprises the information in the consolidated entity’s annual report for the year ended 31 December 2022, but does not include the financial report and the auditor’s report thereon. Our opinion on the financial report does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Directors for the Financial Report The directors of Auric Mining Limited are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the ability of the consolidated entity to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the consolidated entity or to cease operations, or has no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. A further description of our responsibilities for the audit of these financial statements is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf This description forms part of our independent auditor’s report. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in the directors’ report for the year ended 31 December 2022. In our opinion, the Remuneration Report of Auric Mining Limited, for the year ended 31 December 2022, complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. William Buck Audit (Vic) Pty Ltd ABN 59 116 151 136 J. C. Luckins Director Melbourne, 9 March 2023 Auric Mining Limited and CONTROLLED ENTITIES Shareholder information 31 December 2022 The shareholder information set out below was applicable as at 27 February 2023. Distribution of equitable securities Analysis of number of equitable security holders by size of holding: Ordinary shares Listed Options Exp 31/10/2023 @ $0.40 Listed Options Exp 31/03/2024 @ $0.15 Number % of total shares Number % of total shares of holders issued of holders issued % of total shares issued Number of holders 13 55 120 315 184 687 192 - 0.14 0.75 10.23 88.87 - 128 71 203 63 - 1.24 1.46 23.12 74.18 - - 14 34 58 - - 0.58 9.64 89.78 100.00 465 100.00 110 100.00 - 437 - 47 - 1 to 1,000 1,001 to 5,000 5,001 to 10,000 10,001 to 100,000 100,001 and over Holding less than a marketable parcel Equity security holders Twenty largest quoted equity security holders The names of the twenty largest security holders of quoted equity securities are listed below: Ordinary shares % of total Shares issued Number held ANAMORPH PTY LTD (UTLEY FAMILY A/C) R J & A INVESTMENTS PTY LTD (MULLER MORVAN FAMILY A/C) FAIRCHILD CAPITAL AUSTRALIA PTY LTD SRS HGS PTY LTD (SRS FAMILY A/C) 13 NOMINEES PTY LTD (MEES SUPER FUND A/C) MINCOR RESOURCES NL CITICORP NOMINEES PTY LIMITED MR JOHN DENNIS WILLIAMS MR STEVEN JOHN MORRIS & MS NICOLE LEANNE MORRIS (MORRIS FAMILY SUPER FUND A/C) HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2 MS DEBBIE LYNNE WILLIAMS TARGO HOLDINGS PTY LTD ALTOR CAPITAL MANAGEMENT PTY LTD (ALTOR ALPHA FUND A/C) NEOMETALS INVESTMENTS PTY LTD KEMBLA NO 20 PTY LTD (CAA A/C) 140 HOLDINGS PTY LTD (THE HACKNEY A/C) MR STEVEN JOHN MORRIS VALENCE HOLDINGS PTY LTD THE PW & CM STINTON (SUPERANNUATION FUND A/C) LADYMAN SUPER PTY LTD (LADYMANSUPERFUND A/C) LYTTON NOMINEES PTY LTD (LYTTON SUPER FUND A/C) Total Top 20 Others Total 6,836,666 6,258,334 6,125,100 5,125,100 5,031,667 3,666,667 3,635,724 2,775,157 2,520,833 2,446,396 3,358,490 2,312,500 2,083,335 2,000,000 1,700,000 1,500,100 1,500,000 5.22 4.78 4.68 3.92 3.85 2.80 2.78 2.12 1.93 1.87 1.80 1.77 1.59 1.53 1.30 1.15 1.15 1,270,925 1,098,900 1,083,333 61,329,227 69,530,364 130,859,591 0.97 0.84 0.83 46.87 53.13 100.00 45 Auric Mining Limited and CONTROLLED ENTITIES Shareholder information 31 December 2022 Listed Options Exp 31/10/2023 @ $0.40 Options over ordinary shares % of total Options issued Number held R J & A INVESTMENTS PTY LTD (MULLER MORVAN FAMILY A/C) ANAMORPH PTY LTD (UTLEY FAMILY A/C) CONRAD CAPITAL INVESTMENTS PTY LTD (CONRAD INVESTMENTS UNIT A/C) 13 NOMINEES PTY LTD (MEES SUPER FUND A/C) FAIRCHILD CAPITAL AUSTRALIA PTY LTD MINCOR RESOURCES NL SRS HGS PTY LTD (SRS FAMILY A/C) MR STEVEN JOHN MORRIS & MS NICOLE LEANNE MORRIS (MORRIS FAMILY SUPER FUND A/C) TARGO HOLDINGS PTY LTD GOFFACAN PTY LTD (KMM FAMILY A/C) MR ROBERT JAMES PENFOLD HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2 THREE ZEBRAS PTY LTD (JUDD FAMILY A/C) M & K KORKIDAS PTY LTD (M & K KORKIDAS PTY LTD A/C) MR STEPHEN STRUBEL & MR BRIAN STRUBEL (STRUBEL FAMILY S/F A/C) MR THOMAS MAUSEZAHL & MRS EVELYN CALAPAN MANZA (TM SUPERANNUATION FUND A/C) CONRAD CAPITAL GROUP PTY LTD WHIMPLECREEK PTY LTD (STAWELL FAMILY A/C) LYTTON NOMINEES PTY LTD (LYTTON SUPER FUND A/C) MR PETER RAFTOPOULOS Total Top 20 Others Total 2,645,833 2,527,500 2,500,000 2,405,834 2,312,500 1,833,333 1,812,500 1,156,250 1,156,250 834,202 800,827 793,450 666,667 550,000 520,000 520,000 500,000 383,333 333,334 333,334 24,585,147 19,323,028 43,908,175 6.03 5.76 5.69 5.48 5.27 4.18 4.13 2.63 2.63 1.90 1.82 1.81 1.52 1.25 1.18 1.18 1.14 0.87 0.76 0.76 55.99 44.01 100.00 46 Auric Mining Limited and CONTROLLED ENTITIES Shareholder information 31 December 2022 LISTED OPTIONS EXPIRING 31/03/2024 @ $0.15 Options over ordinary shares % of total Options issued Number held JC NEXTGEN PTY LTD (DALPAT NEXGEN CAPITAL A/C) ALTOR CAPITAL MANAGEMENT PTY LTD (ALTOR ALPHA FUND A/C) MGL CORP PTY LTD RIYA INVESTMENTS PTY LTD MR THOMAS CHRISTIAN BLEAKLEY KEMBLA NO 20 PTY LTD (CAA A/C) BILL BROOKS PTY LTD (BILL BROOKS SUPER FUND A/C) MR MICHAEL FRANCIS MCMAHON & MRS SUSAN LESLEY MCMAHON (MCMAHON SUPER A/C) MR WILLIAM DONALD LLOYD ROSDAREM INVESTMENTS PTY LTD (MAPLESON SUPER FUND A/C) SCRATCHING AROUND 4 RETURNS PTY LTD (BLUE COLLAR A/C) WFC NOMINEES PTY LTD (WFC NOMINEES AUSTRALIA A/C) LAZARUS CAPITAL (VIC) PTY LTD R J & A INVESTMENTS PTY LTD (ACME SUPER FUND A/C) R J & A INVESTMENTS PTY LTD (MULLER MORVAN FAMILY A/C) 13 NOMINEES PTY LTD (MEES SUPER FUND A/C) ANAMORPH PTY LTD (UTLEY FAMILY A/C) ANNA BATTERS BARNETT PENSION PTY LTD (BARNETT PENSION FUND A/C) J F BYRNES SUPER PTY LTD (ARGOON AVENUE S/F A/C) Total Top 20 Others Total Listed Options 1,270,833 1,041,667 840,277 690,278 425,751 350,000 347,222 347,222 347,222 347,222 347,222 347,222 300,000 250,000 250,000 208,333 208,333 208,333 208,333 208,333 8,543,803 8,285,332 16,829,135 7.55 6.19 4.99 4.10 2.53 2.08 2.06 2.06 2.06 2.06 2.06 2.06 1.79 1.49 1.49 1.24 1.24 1.24 1.24 1.24 50.77 49.23 100.00 Unquoted equity securities UNLISTED OPTIONS EXPIRING 31/03/2024 @ $0.15 NICHOLAS SNOW CATHERINE YEO Total Unlisted Options Options over ordinary shares Number Held % of total shares 600,000 300,000 900,000 66.67 33.33 100.00 47 Auric Mining Limited and CONTROLLED ENTITIES Shareholder information 31 December 2022 Substantial holders Substantial holders in the Company are set out below: AARON AND CHRISTINE MULLER & RELATED PARTIES MARK ENGLISH AND ELIZABETH SAUNDERS & RELATED PARTIES JOHN UTLEY & RELATED PARTIES STEVEN AND NICOLE MORRIS & RELATED PARTIES Voting rights The voting rights attached to ordinary shares are set out below: Ordinary shares % of total shares issued Number held 8,200,000 6,681,767 6,420,000 6,225,000 7.22 5.89 5.66 5.48 Ordinary shares On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. There are no other classes of equity securities. 48 

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