ACN 148 966 545
Annual Report for the Year Ended 30 June 2017
ABN
Directors
AUROCH MINERALS LIMITED
CORPORATE DIRECTORY
91 148 966 545
Mr Glenn Whiddon (Executive Chairman)
Mr David Lenigas (Non-Executive Director)
Mr Ryan Gaffney (Non-Executive Director)
Company Secretary
Mr James Bahen
Registered office
Website
Share Registry
Bankers
Auditors
Stock Exchange
Solicitors
Unit 5, Ground Floor
1 Centro Avenue
Subiaco WA 6008
Telephone +61 8 9486 4699
Facsimile +61 8 9486 4799
www.aurochminerals.com
Security Transfer Registrars Pty Ltd
770 Canning Highway
Applecross WA 6153
Telephone +61 8 9315 2333
Facsimile +61 8 9315 2233
National Australia Bank
7 Sandridge Road
Bunbury WA 6230
BDO Audit (WA) Pty Ltd
38 Station Street
Subiaco, WA 6008
Australian Securities Exchange Limited
ASX Code: AOU
GTP Legal
Level 1, 28 Ord Street
West Perth WA 6005
1
AUROCH MINERALS LIMITED
CONTENTS
Directors’ Report
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Directors’ Declaration
Additional information
Independent Auditor’s Report
Page
3
17
18
20
21
22
23
51
52
55
2
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
Your Directors present their report on Auroch Minerals Limited (Auroch, Company or the Group) for the period 1 July
2016 to 30 June 2017.
REVIEW OF OPERATIONS
Auroch has expanded its foot print in the European renewable space through the significant Alcoutim Cu-Zn-Pb-Au-Ag
Project opportunity in south-eastern Portugal and the Tisova Co-Cu Project in the Czech Republic.
TISOVÁ PROJECT
The Company advised that it has entered into option agreements giving it the right to acquire 100% of the historic Tisová
copper mine and 3 exploration license applications (subject to approval by relevant authorities) in the Czech Republic.
Sampling at Tisová
The Company collected a suite of representative samples from the waste dumps at Tisová. Copper ores form lenses more
than several hundred meters in length but only 2 to 5 m width within a much thicker stratabound envelope of sulphides
which were regarded as waste by historic mining. These sulphides were systematically sampled on the old dumps. They
represent a wide range of potential ore types in the broader sulphide halos with significant amounts of other metals such
as cobalt and gold. Importantly the analytical data suggest that the best cobalt and gold grades are NOT associated with
the narrow high-grade copper zones. The results are shown below in Table 1.
3
SAMPLEsulphides% sulphidesAu g/tCo %Cu %TS001Py > Po > Cpy701.970.162.5TS002Py >Po > Cpy701.010.141.95TS003Po vein >>Cpy50.120.090.23TS004Py early, dissem200.150.090.3TS005Py early, dissem303.730.170.24TS006Py>>Cpy300.690.270.15TS007Py+Cpy100.210.043.56TS008Py600.090.020.18TS009Cpy>>Py100.520.023.6TS010Po>Py>Cpy300.860.120.74TS011Po, Cpy201.760.050.67TS012Py>>Cpy702.140.292.25TS013Po>Py>Cpy101.40.691.17TS014Py vein50.020.070.23TS015Po>>Cpy701.470.182.09TS016Cpy, Py vein30.140.141.08TS017Py, Cpy vein30.070.010.94TS018Py102.220.30.82Average1.030.161.26
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
Mineralisation at Tisová
The Tisová orebody comprises a thick zone (in excess of 100m true thickness – see figure 1) of semi-massive and
disseminated sulphides dominantly comprising pyrrhotite and pyrite with lesser amounts of chalcopyrite, sphalerite,
cobaltite, electrum, arsenopyrite, magnetite and bismuthinite. The deposit is interpreted to be a “Beshi” type Volcanic
Massive Sulphide (VMS) based on the tectonic setting and the element distribution.
The VMS mineralisation comprises at least three stratabound horizons that strike NE and dip around 25 degrees to the
north-west. Previous drilling has outlined a strike length of over 1,000m remaining open to the south west and down dip.
Previous underground mining between 1953 and 1973 has removed the bulk of the known copper-rich mineralisation
down to 200m below surface.
In the 1980s, the wider surroundings of the Tisová deposit were covered by early stage exploration (soil geochemistry,
geophysics). A surface and underground drilling programme in the central and southern zone of the deposit was executed
during the period of 1971-1989, producing reserves (non-JORC) down to 400 m below surface (level 9 of Helena shaft). A
large portion of the underground mine development was completed; however, mining was not resumed due to the
political system change in Eastern Europe. In 1990 and the mine was abandoned and allowed to flood. Historical figures
confirm that 561,000 tonnes of copper ore at a grade of 0.68% was transported from Tisová to the Krasno processing
facility where copper was extracted from a flotation circuit.
Figures 1 - Cross-sectional view of the Tisová orebodies – Redrafted from figures presented in P. Kozubek 1984. The deep-red colour represents the chalcopyrite
rich zones which were exploited by the previous mining. The blue zone represents the thicker pyrite & pyrrhotite sulphide zone where Auroch sampling has
indicated the presence of significant cobalt and gold mineralisation. Image of Sydney Harbour Bridge at same scale to show mapped size of sulphide orebody.
4
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
Work Plan
The Company has received initial approval from the Department of the Environment and Agriculture for its initial 12-hole
drilling program at the historic Tisová Copper mine, where sampling has highlighted the presence of previously un-sampled
Cobalt, Gold and Silver in addition to the known Copper.
Figure 2 – Tisová Licence showing historical collars in Blue and new planned drilling in Red. The
strike and dip of the stratabound orebody is also shown.
ALCOUTIM PROJECT
The Company entered into a new Joint Venture to earn up to 75% of the Alcoutim Project, a significant Cu-Zn-Pb-Au-Ag
exploration opportunity in south-eastern Portugal located immediately along strike from the supergiant Neves Corvo
Mine in the western half of the world famous Iberian Pyrite Belt (IPB).
5
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
The Company is to spend ~A$1.4 million to earn a 65% interest in the Alcoutim Project. Auroch will also have the right,
but not the obligation, to earn a further 10% by spending a further ~A$1.25 million.
The Company advised it commenced its Phase 1 drill program on Alcoutim Project, the significant Cu-Zn-Pb-Au-Ag
opportunity in south-eastern Portugal located immediately along strike from the supergiant Neves Corvo Mine in the
western half of the world famous Iberian Pyrite Belt (IPB).
Completion of drilling and down hole Geophysics at ALFP001
Diamond drill hole ALFP001 was drilled to 1,156.60m and completed on budget and schedule. It finished in interbedded
shales and greywackes the hole targeted an EM conductor at >800m depth.
The conductor was interpreted to be massive sulphides hosted by a lower order black shale basin, surrounded by mafic
magmatic rocks of the Foupana magmatic centre. The Iberian Pyrite Belt is known to host several deposits in similar
geologic settings.
At the completion of ALFP001, Terratec Geoservices mobilised to site (Figure 2) and completed a 2 loop (1,000m x
1,000m) Down Hole Transient Electromagnetic (DHTEM) survey in the lower portion of the hole (736 -1,155 m. Figure 2
shows the design of the 2-loop layout. Preliminary processing of the DHTEM data has indicated no conductors were
intersected or in the immediate vicinity of the first drill hole.
Hole ALFP002
Diamond drill hole ALFP002 intersected at the VSC sequence of altered and brecciated volcanic rocks that are host to the
Volcanic Hosted Massive Sulphide (VMS) style mineralisation throughout the Iberian Pyrite Belt. The volcanic rocks that
comprise the VSC are an integral part of the belt-wide mineralising event that emplaced the orebodies. In effect, the
volcanic activity provides the heat to drive the fluid flow that creates a VMS and locating a volcanic rich package is an
important step in locating mineralisation.
The ALFP002 target was selected on the basis of geologic and geophysical targeting that included:
a strong historic EM conductor within the VSC from historic geophysical surveys;
central position within the Foupana magmatic centre of the Neves-Corvo-Trend,
proximity to FP-1 (historic DD hole) which intercepted perspective VSC stratigraphy (host to ore bodies at
Neves Corvo)
A total of 22 potential VMS targets have been defined by integrating geology and geophysics throughout the large
Alcoutim license area, with the first 5 holes to test priority targets along the Neves Corvo Trend. The Foupana magnetic
anomaly (42 km southeast of the supergiant Neves Corvo Mine) is the largest and most intense magnetic anomaly of the
Neves Corvo Trend which is interpreted to be a large, submarine centre of bimodal magmatic activity. Coincident EM
anomalies are possible massive sulphide mineralisation.
Down hole Transient Electromagnetic (DHTEM) surveys and geochemical assays will be collected from all holes when
complete as part of continual refining of target selection.
NAMIBIAN EXPLORATION PROSPECTING LICENCES
The Company advised it applied for five new Exclusive Prospecting Licences (EPLs) in the Erongo Region of Namibia.
Following the application, the Company exercised its option to acquire 90% of EPL 5751. Namibia has been experiencing
a strong wet season (long overdue) and this has hampered efforts to visit all this large and remote licence. Attempts for
field work access is still on going.
6
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
Lithium Mineralisation on EPL 5751
EPL 5751 contains four historical pegmatite occurrences; the Tsaobis, Nordenburg, Dorstriver and Villa Rosa pegmatites.
Field visits to date by Auroch geologists have revealed lithium mineralisation is present at Tsaobis. At this stage
mineralisation is confined to sporadic occurrences of Lithiophilite, an iron-manganese-lithium phosphate mineral.
However, the presence of lithiophilite confirms that the pegmatite is a LCT pegmatite and increases the potential to find
lithium enriched mineralisation on the licence.
NORSEMAN GOLD PROJECTS, WESTERN AUSTRALIA
The Company dropped it’s 100% interest in two prospecting licenses in Western Australia; the Beete Gold Project
(P63/1646) and the Peninsula Gold Project (P63/1694).
The company conducted a significant multi-element soil survey across both tenement during the year. During this time
the main zones of interest were re-mapped and a new interpretation was completed.
Given the small nature of these targets and Company’s new strategy to focus on exploring for metals crucial to the
renewable energy market (Cobalt, Lithium and Copper) a decision was made to abandon these projects.
CORPORATE
Board & Company Secretary Appointments
During the Period the Company advised that Mr David Lenigas had been appointed to the Board as Non-Executive Director.
Mr Lenigas is an experienced mining engineer with significant global resources and corporate experience, having served
as executive chairman, chairman, and non-executive director of many public listed companies in London, Canada,
Johannesburg, and Australia.
In recent years, Mr Lenigas was the Executive Chairman of London listed lithium investment company Rare Earth Minerals
Plc, which has been responsible for provided significant funding for the development of the large Sonora Lithium Project
in Mexico and the Cinovec Lithium Project in the Czech Republic. He is currently a non-executive director of Canadian
listed Australian company Macarthur Minerals, whose major shareholder is Rare Earth Minerals Plc.
Mr Lenigas was also, until recently, the Executive Chairman of London listed UK Oil & Gas Investments Plc, which was
responsible for the new Horse Hill oil discovery near London’s Gatwick International Airport that flowed on to test a UK
onshore record of 1,688 barrels of oil per day. He is now the Executive Chairman of London listed Doriemus Plc, which
owns an interest in the Horse Hill oil discovery and is working with its JV partners towards moving Horse Hill in to
production.
Mr Lenigas has a Bachelor of Applied Science (Mining Engineering) (Distinction) from Curtin University’s Kalgoorlie School
of Mines and holds a Western Australian First Class Mine Manager's Certificate of Competency.
The Company also advised that Mr James Bahen had been appointed as Company Secretary of the Company. Mr Bahen
holds a Bachelor of Commerce degree majoring in Accounting and Finance. He commenced his career in audit and
assurance with a Chartered Accounting firm and has worked in a corporate advisory firm providing company secretarial
support to a number of listed companies that operate in the resource sector.
The Company further advised that Mr Matthew Foy resigned as Non-Executive Director and Company Secretary.
Shareholder Approval
The Company announced that all resolutions put to shareholders at the extraordinary general meeting held on 16 March
2017, including ratification of prior issue of placement shares and placement options, were successful.
7
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
Settlement proceed realized from Xtract Resources Plc
The Company advised it has crystallised A$1,280,3331 in cash via the sale of shares in Xtract on the AIM market in addition
to the receipt of cash payments from Xtract Resources Plc (Xtract) (refer to ASX announcement 2 March 2017).
The Convertible Loan Note with Xtract with a face value of US$748,136 was repaid.
A further US$ 1 million is still outstanding, together with accrued interest of US$38,904.11. This amount accrues interest
at 10% p.a. and is due for repayment no later than December 31, 2017; being settled firstly in cash or repaid via the issue
of shares in Xtract at a 15% discount to the 10 day volume weighted average share price.
Appendix 1 - Interest in Mining Tenements
Western Australia
Tenement
Beete
Peninsula
Namibia
Tenement
Garums
Okattjiho
Orutjiva
Moria
Narubis
Karibib
Portugal
Tenement
Alcoutim(1)
Tenement
ID
P63/1646
P63/1694
Status
Granted
Granted
Interest at beginning
of year
100%
100%
Interest
acquired or
disposed
100%
100%
Interest at
end of year
0%
0%
Tenement
ID
Status
Interest at beginning
of year
EPL6840
EPL6484
EPL6482
EPL6841
EPL6483
EPL 5751
Application
Application
Application
Application
Application
Option
-
-
-
-
-
-
Interest
acquired or
disposed
-
-
-
-
-
-
Interest at
end of year
-
-
-
-
-
-
Tenement
ID
MN/PP/008/
14
Status
Interest at beginning
of year
Granted
0%
Interest
acquired or
disposed
65%
Interest at
end of year
65%
(1) The Company has the right to earn a 75% interest in the Alcoutim Project
Czech Republic
Tenement
Tisova(1)
Tenement
ID
Č.j.
77533/ENV/14,
2091/530/14
Status
Interest at beginning
of year
Granted
-
Interest
acquired or
disposed
-
Interest at
end of year
-
(1) The Company has the option to earn a 100% interest in the Tisova Project
Competent Persons Statement
The information in this report that relates to Exploration Results is based on information compiled by Dr. Andrew Tunks and represents an accurate representation of
the available data. Dr. Tunks (Member Australian Institute Geoscientists) is the CEO of the Company and has sufficient experience that is relevant to the style of
mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the
‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Dr Tunks consents to the inclusion in the report of the matters based on
his information in the form and context in which it appears.
1 Based on a GBP/AUD exchange rate of 1GBP = 1.65AUD
8
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
DIRECTORS
The names of Directors who held office during or since the end of the period:
Mr Glenn Whiddon
Mr Ryan Gaffney
Mr David Lenigas (appointed 7 November 2016)
Mr Matthew Foy (resigned 28 April 2017)
INFORMATION ON DIRECTORS
Information on Directors as at the date of this report is as follows:
Mr Glenn Whiddon
Executive Chairman
Glenn has an extensive background in equity capital markets, banking and corporate advisory with specific focus on natural
resources, enabling project origination and financing. He has a significant contact network throughout the world which
has led to the development of a number of projects. Glenn holds an economics degree and has extensive corporate and
management experience. He has global banking experience with The Bank of New York in Australia, Europe and Russia.
Mr Whiddon is currently a director of Calima Energy Ltd and Fraser Range Metals Group Ltd and Statesman Resources Ltd.
In the past 3 years Mr Whiddon has been a director of Zyl Ltd, Sirocco Energy Ltd, Azonto Petroleum and Rialto Energy
Ltd.
Equity interests: 9,634,627 ordinary shares, 1,818,147 options exercisable at $0.08 on or before 31 December 2018,
2,850,000 options exercisable at $0.20 on or before 23 October 2018.
Mr Ryan Gaffney
Non-Executive Director
Ryan holds a BSBA in Finance and Economics from the Daniels College of Business, University of Denver, Colorado. Ryan,
based in London, UK, currently runs an independent advisory and consulting business focused on Mergers and Acquisitions
advisory and fundraising for small and medium-cap companies. He was previously a Managing Director with Canaccord
Genuity in London, where he focused on providing natural resources clients with mergers and acquisitions, financing, and
advisory services from 2002 to 2015.
Ryan is not currently a director of any other listed company and has not held any directorships in the last three years.
Equity interests in the Company: Nil.
Mr David Lenigas (Appointed 7 November 2016)
Non-Executive Director
Mr Lenigas is an experienced mining engineer with significant global resources and corporate experience, having served
as executive chairman, chairman, and non-executive director of many public listed companies in London, Canada,
Johannesburg, and Australia.
Mr Lenigas has a Bachelor of Applied Science (Mining Engineering) (Distinction) from Curtin University’s Kalgoorlie School
of Mines and holds a Western Australian First Class Mine Manager's Certificate of Competency.
Mr Lenigas is currently a director of Cadence Minerals Plc, Macauther Minerals Limited, Artemis Resources Limited,
Doriemis Plc, AfriAg Plc and Clancy Exploration Limited.
In the past 3 years Mr Lenigas has been a director of Oil & Gas Investments Plc.
Equity interests in the Company: Nil.
9
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
Mr Matthew Foy (resigned 28 April 2017)
Non-Executive Director & Company Secretary
Matthew is an active member of the WA State Governance Council of the Governance Institute of Australia (GIA) and
spent four years at the ASX facilitating the listing and compliance of companies. Matthew is also currently a Non-Executive
Director of Minerals Corporation Ltd.
In the last 3 years, Matthew has been a Non-Executive Director of Segue Resources Ltd (resigned 1 September 2014),
Omni Market Tide Limited (resigned 22 July 2015) and MSM Corporation Ltd (resigned 12 January 2016).
Equity interests in the Company: 175,000 ordinary shares.
DIRECTORS MEETING
There were no formal Directors’ meetings held during the period. The Directors’ conducted formal business via
circulating resolution.
REMUNERATION REPORT (Audited)
The Remuneration Report is set out under the following main headings:
Remuneration policy
Details of remuneration
Share-based compensation
Equity instrument disclosures relating to Key Management Personnel
Loans to Key Management Personnel
Other transactions with Key Management Personnel
Service agreements
The information provided in this remuneration report has been audited as required by section 308 (3C) of the Corporations
Act 2001.
This report details the nature and amount of remuneration for each Director of Auroch Minerals Limited and key
management personnel of the group. Those who are considered key management personnel of the group during the
period are as follows:
1. Glenn Whiddon (Executive Chairman)
2. David Lenigas (Non-Executive Director, appointed 7 November 2016)
3. Matthew Foy (Non-Executive Director, Company Secretary, Resigned 28 April 2017)
4. Andrew Tunks (Chief Executive Officer, appointed 9 January 2015)
5. Ryan Gaffney (Non-Executive Director)
6. James Bahen (Company Secretary, appointed 28 April 2017)
Remuneration policy
The remuneration policy of Auroch has been designed to align director and management objectives with shareholder and
business objectives by providing a fixed remuneration component, and offering specific long-term incentives, based on
key performance areas affecting the Group’s financial results. Key performance areas of the Group include cash flow,
share price, exploration results and development of cash-generating business activities. The Board of Directors (the Board)
of Auroch believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best
management and directors to run and manage the Group, as well as create goal congruence between directors, executives
and shareholders.
Voting and comments made at the company’s 2016 Annual General Meeting
At the 2016 Annual general Meeting the Company remuneration report was passed by the requisite majority of
shareholders (100% by a show of hands).
10
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
Remuneration Governance
The Board’s policy for determining the nature and amount of remuneration for Board members and senior executives of
the Group is as follows:
The remuneration policy, setting the terms and conditions for the executive directors and other senior executives, was
developed and approved by the Board. All executives receive a base salary (which is based on factors such as length of
service and experience), superannuation, fringe benefits and the ability to receive options and performance-based
incentives. The remuneration committee, composed of the full Board, reviews executive packages annually by reference
to the Group’s performance, executive performance, and comparable information from industry sectors and other listed
companies in similar industries.
Executives are also entitled to participate in the employee share and option arrangements.
The employees of the Group receive a superannuation guarantee contribution required by the government, which is
currently 9.5%, and do not receive any other retirement benefits.
All remuneration paid to Directors and executives is valued at the cost to the Group and expensed. Options (if applicable)
given to Directors and Key Management Personnel are valued using an appropriate option pricing methodology.
The Board policy is to remunerate non-executive Directors at the lower end of market rates for comparable companies
for time, commitment, and responsibilities. The remuneration committee 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. Fees for non-executive Directors are not linked to the performance of the Group.
However, to align Directors’ interests with shareholder interests, the Directors are encouraged to hold shares in the Group.
The maximum aggregate amount of fees that can be paid to non-executive Directors was approved by shareholders at a
General Meeting held on 11 February 2011. The maximum amount of fees payable to non-executive directors is
$250,000 per annum.
The Board expects that the remuneration structure implemented will result in the company being able to attract and
retain the best executives to run the Company. It will also provide executives with the necessary incentives to work to
grow long-term shareholder value.
The payment of bonuses, options and other incentive payments are reviewed by the Board as part of the review of
executive remuneration. All bonuses, options and incentives must be linked to predetermined performance criteria. The
Board can exercise its discretion in relation to approving incentives, bonuses and options. Any changes must be justified
by reference to measurable performance criteria. During the Period no performance based incentives, options or bonuses
were granted to any director or executive. As such, no pre-determined performance criteria have been outlined for the
existing Board.
During the year the company did not seek the advice of remuneration consultants.
Company performance, shareholder wealth and director and executive remuneration.
The following table shows gross revenue, profits/losses and share price of the Group at the end of the current and previous
financial years since incorporation. There is no link between company performance and remuneration given the current
nature of the Company’s operations.
11
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
30 June
2017
$
30 June
2016
$
30 June
2015
$
30 June
2014
$
Revenue from continuing operations (interest only)
Net profit/(loss)
Share price
The remuneration policy has been tailored to increase goal congruence between shareholders, directors and executives.
This will be achieved via offering performance incentives based on key performance indicators.
242,275
(1,919,686)
$0.145
81,791
(1,003,116)
$0.12
1,178
2,510,541
$0.13
29,154
(921,051)
$0.05
Details of remuneration
2017
Short-term
benefits
Name
Glenn Whiddon(i)
Matthew Foy(ii)
David Lenigas (iii)
Ryan Gaffney
Other
Andrew Tunks
James Bahen (iv)
Total
Cash
Salary and
Fees
233,900
80,300
49,600
43,000
249,960
12,294
671,754
Post-
employment
benefits
Super-
annuation
-
-
-
-
-
1,168
1,168
Share-based Payment
Equity
Options
Total
%
perf. based
-
-
-
-
-
-
-
-
-
-
-
-
233,900
80,300
49,600
43,000
249,960
13,462
672,922
Glenn Whiddon was paid a bonus of $50,000 in respect of the Manica asset sale transactions.
(i)
(ii) Mattew Foy resigned 28 April 2017
(iii) David Lenigas appointed 7 November 2016
James Bahen appointed 28 April 2017
(iv)
2016
Name
Short-term
benefits
Cash
Salary and
Fees
Post-
employment
benefits
Super-
annuation
Share-based Payment
Equity
Options
Total
%
perf. based
Glenn Whiddon
Matthew Foy
Nicholas Ong (i)
Ryan Gaffney (ii)
Other
Andrew Tunks
Total
171,800
-
-
-
114,785
286,585
-
-
-
-
-
-
-
16,450
-
-
40,000
56,450
12
-
-
-
-
-
-
171,800
16,450
-
-
154,785
343,035
-
-
-
-
-
-
-
-
-
-
-
-
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
(i) Nicholas Ong resigned 29 June 2016
(ii) Ryan Gaffney appointed 29 June 2016
Share-based compensation
The Auroch Minerals Limited Employee Share Plan (the “Plan”) is used to reward Directors and employees for their
performance and to align their remuneration with the creation of shareholder wealth. Approved by Shareholders 4 April
2013 the Plan is designed to provide long-term incentives to deliver long-term shareholder returns. Participation in the
Plan is at the discretion of the Board and no individual has a contractual right to participate in the plan or to receive any
guaranteed benefits.
During the Period no shares were issued under the Plan.
Shares
There were no shares issued to Directors or employees by the Group under the Plan during the year (2016: Nil), refer to
the above table for details of share based payments to Directors and employees not under the Plan.
Options
There were no options issued to Directors or employees by the Group (2016: Nil) under the Plan during the year.
Equity Instrument Disclosures Relating to Key Management Personnel
(i) Options provided as remuneration and shares issued on any exercise of such options
There were no options provided as remuneration and shares issued on any exercise of such options issued during the
period.
(ii) Option holdings
At the end of the period, the Director’s option holdings are as follows:
Balance at the
2017
start of the period
Other changes during the
period
Balance at the end
of the period
Received during
the period
Options
Directors
Glenn Whiddon
Matthew Foy(i)
David Lenigas (ii)
Ryan Gaffney
4,668,147
-
-
-
-
-
-
-
Employees
Andrew Tunks(iii)
James Bahen (v)
Total
(i) Mattew Foy resigned 28 April 2017
(ii) David Lenigas appointed 7 November 2016
(iii) Issued as part of free attaching options to placement
(iv) James Bahen appointed 28 April 2017
-
-
4,668,147
1,750,000
-
1,750,000
13
-
-
-
-
-
-
-
4,668,147
-
-
-
1,750,000
-
6,418,147
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
(iii) Share holdings
Aggregate numbers of shares of the Group held directly, indirectly or beneficially by Directors or key management
personnel of the Group at the date of this report:
2017
Fully Paid Shares
Directors
Glenn Whiddon
Matthew Foy(i)
David Lenigas (ii)
Ryan Gaffney
Employees
Andrew Tunks
James Bahen (iii)
Total
Balance at the
start of the period
Received during
the period
Other changes during the
period
Balance at the end
of the period
9,634,627
175,000
-
-
500,000
-
10,309,627
-
-
-
-
-
-
-
-
-
-
-
175,000
-
175,000
9,634,627
175,000
-
-
675,000
-
10,484,627
(i)
(ii)
(iii)
Mattew Foy resigned 28 April 2017
David Lenigas appointed 7 November 2016
James Bahen appointed 28 April 2017
Loans to Key Management Personnel
There were no loans to key management personnel during the year.
Other transactions with Key Management Personnel
Mr Mattew Foy is a director of Minerva Corporate Pty Ltd. During the period ended 30 June 2017 the Company was
providing consultancy, company secretarial, accounting and administration and registered office services to Auroch
Minerals Limited. Payments to Minerva Corporate Pty Ltd during the relevant period total $93,187 (2016: $116,500). The
amounts owed to Minerva Corporate Pty Ltd as at 30 June 2017 was nil (2016: $9,000).
Service Agreements
Mr Andrew Tunks has a consultancy agreement with the Company whereby Mr Tunks provides services in his capacity as
Chief Executive Officer. The consulting agreement commenced on 9 January 2015 and was amended on 29 June 2016 for
an indefinite term at $250,000 per annum. The Company or Mr Tunks may terminate the agreement by giving one months’
notice, or by the Company making one months’ payment in lieu of notice.
Mr James Bahen has an executive employment agreement with the Company whereby Mr Bahen provides services in his
capacity as Company Secretary. The agreement commenced on 10 April 2017 for an indefinite term at $60,000 per annum.
The Company or Mr Bahen may terminate the agreement by giving one months’ notice, or by the Company making one
months’ payment in lieu of notice.
End of Audited Remuneration Report
14
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
OPERATING RESULTS
The net loss after providing for income tax amounted to $1,919,686 (2016: Profit $2,510,541).
PRINCIPAL ACTIVITY
The principal activity of the Group is mineral exploration and development.
DIVIDENDS
There were no dividends paid or recommended during the financial year ended 30 June 2017 (2016: Nil).
FINANCIAL POSITION
The net assets of the Group at 30 June 2017 are $7,720,238 (2016: $8,655,798).
ENVIRONMENTAL REGULATIONS
In the normal course of business, there are no environmental regulations or requirements that the Group is subject to.
Greenhouse gas and energy data reporting requirements
The Company is not required to report under the Energy Efficiencies Opportunity Act 2006 or the National Greenhouse
and Energy Efficient Reporting Act 2007 (the Acts).
INDEMNIFYING OFFICERS OR AUDITOR
In accordance with the constitution, except as may be prohibited by the Corporations Act 2001 every Officer of the
Company shall be indemnified out of the property of the Company against any liability incurred by him in his capacity as
Officer, auditor or agent of the Company or any related corporation in respect of any act or omission whatsoever and
howsoever occurring or in defending any proceedings, whether civil or criminal. During the period the Group paid
$17,243 in premiums for Directors and Officer Insurance.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of the Group, or to intervene in any proceedings to which the Group is a party, for the purposes of taking
responsibility on behalf of the Group for all or part of those proceedings.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
There has been no other significant changes in the state of affairs of the Group during the financial year.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS
In the opinion of the Directors, disclosure of any further information on likely developments in operations and expected
results would be prejudicial to the interests of the Group, the consolidated entity and shareholders.
MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR
On 3 July 2017 the company advised it entered into option agreements giving it the right to acquire 100% of the historic
Tisová copper mine and 3 exploration licence applications (subject to approval by relevant authorities) in the Czech
Republic.
The material commercial terms of the option agreements for 100% of the project are summarised below:
Option Period – 9 months (to be extended if Auroch is not able to complete its due diligence and work
programme commitment within the initial 9-month period due to matters outside of Auroch’s control, including
weather and permitting issues)
On execution of the Options, Auroch is obliged to reimburse the vendors of the Czech permit and applications
for approx. A$75,000 in costs incurred by the vendors
15
AUROCH MINERALS LIMITED
DIRECTORS’ REPORT
Work programme commitment
During the Option Period, Auroch will complete 4 holes (approx. 1,200m total) to confirm spatial distribution of
Co and Cu (also Au Ag) on the Czech permits
Upon the exercise of the Options within the Option Period, the following payments will be made to the vendors of the
Czech permit and applications:
Cash payment of A$75,000 on completion
4,375,000 fully paid ordinary shares to be issued on completion
Deferred consideration of 5,000,000 addition fully paid ordinary shares to be issued (subject to shareholder
approval) on:
o a decision to mine on the project area;
o a change of control of Auroch (unless Auroch elects to return the project to the vendors for nil
consideration); or
o a sale of the project.
NON AUDIT SERVICES
During the financial period the following fees were paid or payable for services provided by the auditor:
BDO Corporate Tax (WA) Pty Ltd, tax compliance
2017
$
24,847
24,847
2016
$
34,454
34,454
The Group may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s
expertise and experience with the Group and/or the group are important.
The board of directors has considered the position and is satisfied that the provision of the non-audit services is compatible
with the general standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied
that the provision of non-audit services by the auditor did not compromise the auditor independence requirements of the
Corporations Act 2001 for the following reasons:
all non-audit services have been reviewed by the board of directors to ensure they do not impact the impartiality
and objectivity of the auditor
none of the services undermine the general principles relating to auditor independence as set out in APES 110
Code of Ethics for Professional Accountants.
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the independence declaration by the lead auditor under section 307C of the Corporations Act 2001 is included
on page 17 of this financial report.
This report is signed in accordance with a resolution of the Board of Directors.
Glenn Whiddon
DIRECTOR
Dated this 26th day of September 2017
16
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY DEAN JUST TO THE DIRECTORS OF AUROCH MINERALS LIMITED
As lead auditor of Auroch Minerals Limited for the year ended 30 June 2017, I declare that, to the best
of my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Auroch Minerals Limited and the entities it controlled during the
period.
Dean Just
Director
BDO Audit (WA) Pty Ltd
Perth, 26 September 2017
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN
77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK
company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under
Professional Standards Legislation, other than for the acts or omissions of financial services licensees.
AUROCH MINERALS LIMITED
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2017
Revenue
Less Expenses:
Accounting fees
Audit fees
Advertising and marketing
Borrowing costs
Consulting fees
Corporate advisory
Directors expense
Employee benefits expense
Corporate and regulatory fees
Interest
Impairment expense
Legal costs
Rent
Share based payment expense
Travel & accommodation
Finance costs
Foreign exchange loss
Other expenses
(Loss) before income tax
Income tax expense
(Loss) after income tax
Note
3
2017
$
2016
$
497,245
43,893
(40,500)
(28,133)
(21,601)
-
(446,832)
(25,500)
(98,214)
(263,422)
(22,153)
(1)
(230,702)
(171,501)
(17,469)
-
(115,435)
(101,764)
(189,415)
(644,291)
(1,919,686)
(108,142)
(41,265)
-
(12,500)
(422,834)
(30,000)
(18,887)
(25,000)
(22,734)
(80,261)
(556,534)
(157,222)
-
(265,563)
(75,520)
(221,209)
(482,780)
(127,071)
(2,603,629)
5
-
(1,919,686)
(847,355)
(3,450,984)
Profit from sale of discontinued operations
Profit/(Loss) for the year
-
(1,919,686)
5,961,525
2,510,541
18
AUROCH MINERALS LIMITED
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2017
Note
2017
$
2016
$
Other comprehensive income
Items that have been reclassified to the profit or loss
Exchange differences on disposal of controlled entities
Items that may be reclassified to the profit or loss
Exchange difference on translation of foreign operations
Other comprehensive income/(loss) for the year net of tax
Total comprehensive income/(loss) for the year attributable to
the owners of Auroch Minerals Limited
Basic loss per share (cents per share) from continuing operations
attributable to the ordinary equity holders of the company
Diluted loss per share (cents per share) from continuing
operations attributable to the ordinary equity holders of the
company
Basic profit/(loss) per share (cents per share) attributable to the
ordinary equity holders of the company
Diluted profit/(loss) per share (cents per share) attributable to
the ordinary equity holders of the company
6
6
6
6
-
-
-
191,382
-
191,382
(1,919,686)
2,701,923
(2.36)
(2.36)
(2.36)
(2.36)
(5.27)
(5.27)
4.12
2.62
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with
the accompanying notes.
19
AUROCH MINERALS LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2017
Note
2017
$
2016
$
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
Non-current Assets
Property, plant and equipment
Mineral exploration and evaluation expenditure
Total Non-current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and other payables
Total Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
7
8
9
10
11
12
13
14
4,790,836
2,983,196
7,774,032
5,223,618
3,392,763
8,616,381
20,442
37,106
57,548
-
171,507
171,507
7,831,580
8,787,888
111,342
111,342
111,342
132,090
132,090
132,090
7,720,238
8,655,798
10,467,539
424,464
(3,171,765)
7,720,238
9,518,702
389,175
(1,252,079)
8,655,798
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
20
AUROCH MINERALS LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2017
Contributed
Equity
Accumulated
Losses
Option
Reserve
Share Based
Payments
Reserve
$
$
$
$
9,518,702
-
(1,252,079)
(1,919,686)
-
-
-
(1,919,686)
194,828
194,347
-
-
-
-
-
-
Foreign
Currency
Translation
Reserve
$
-
-
-
-
-
-
-
-
Total Equity
$
8,655,798
(1,919,686)
-
(1,919,686)
986,337
35,289
(37,500)
7,720,238
(191,382) 4,123,489
- 2,510,541
191,382
191,382
191,382 2,701,923
-
-
-
194,347
115,533
-
-
-
-
-
-
-
-
194,828
-
-
194,828
-
-
78,814
-
194,347
- 1,575,130
194,828
-
78,814
-
(18,386)
-
- 8,655,798
986,337
-
(37,500)
10,467,539
-
-
-
(3,171,765)
-
35,289
-
230,117
7,961,958
-
(3,762,620)
2,510,541
-
-
-
2,510,541
1,575,130
-
-
(18,386)
-
-
-
-
Balance at 1 July 2016
Profit/Loss for year
Exchange difference on foreign
operations
Total comprehensive loss for year
Transactions with owners in their
capacity as owners:
Issue of shares
Issue of options
Share capital raising costs
Balance at 30 June 2017
Balance at 1 July 2015
Profit/Loss for year
Exchange difference on foreign
operations
Total comprehensive loss for year
Transactions with owners in their
capacity as owners:
Issue of shares
Issue of options
Share based payment reserve
Share capital raising costs
Balance at 30 June 2016
9,518,702
(1,252,079)
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
21
AUROCH MINERALS LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2017
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
Interest paid
Net cash (outflow) from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Advance of funds
Payment for purchase of plant, equipment and prospects
Payments for exploration expenditure
Proceeds from sale of prospects
Net cash inflow from investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings
Proceeds from issue of shares and options
Capital raising costs
Net cash inflow from financing activities
Net increase/(decrease) in cash and cash equivalents
Foreign exchange movement on cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Note
2017
$
2016
$
15
(1,782,745)
44,988
(1)
(1,737,758)
(1,605,933)
(22,968)
(110,530)
2,393,388
653,957
-
787,924
(37,500)
750,424
(333,377)
(99,405)
5,223,618
(1,438,155)
1,146
(179,442)
(1,616,451)
-
-
(999,811)
7,306,573
6,306,762
829,673
-
(21,505)
808,168
5,498,479
(361,528)
86,667
NET CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
7
4,790,836
5,223,618
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
22
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
In order to assist in the understanding of the accounts, the following summary explains the material accounting policies
that have been adopted in the preparation of the accounts.
(a) Basis of Preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards,
other authoritative pronouncements of the Australian Accounting Standards Board, Australian Accounting Interpretations
and the Corporations Act 2001. The Company is a for-profit entity for the purpose of preparing these financial statements.
Compliance with IFRS
The financial statements of the company also comply with International Financial Reporting Standards (IFRS) as issued by
the International Accounting Standards Board (IASB)
Historical cost convention
These financial statements have been prepared on an accruals basis and are based on historical costs and do not take into
account changing money values or, except where stated, current valuations of non-current assets. Cost is based on the
fair values of the consideration given in exchange for assets.
Early adoption of new standards
The Group has elected not to early adopt any new standards issued not yet effective. Refer to note 1 (t) for an assessment
of the impact of these standards to the Group.
(b) Principles of Consolidation
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Auroch Minerals Limited
as at 30 June 2017 and the results of all subsidiaries for the year then ended. Auroch Minerals Limited and its subsidiaries
together are referred to in this financial report as the group or the consolidated entity.
Subsidiaries are all entities (including structured entities) over which the group has control. The group controls an entity
when the group 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 to direct the activities of the entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated
from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted
by the Group.
Joint arrangements
Under AASB 11 Joint Arrangements investments in joint arrangements are classified as either joint operations or joint
ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal
structure of the joint arrangement.
Joint operations
The group recognises its direct right to the assets, liabilities, revenues and expenses of joint operations and its share of
any jointly held or incurred assets, liabilities, revenues and expenses.
23
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
Joint ventures
Interests in joint ventures are accounted for using the equity method, after initially being recognised at cost in the
consolidated statement of financial position.
(c) Impairment of Assets
The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such
indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset’s
recoverable amount.
An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and is determined for an
individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets
or groups of assets and the asset’s values in use cannot be estimated to be close to its fair value. In such cases the asset
is tested for impairment as part of the cash generating unit to which it belongs.
When the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-
generating unit is considered impaired and is written down to its recoverable amount. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks specific to the asset.
Impairment losses relating to continuing operations are recognised in those expense categories consistent with the
function of the impaired asset unless the asset is carried at re-valued amount (in which case the impairment loss is treated
as a revaluation decrease).
As assessment is also made at each reporting date as to whether there is any indication that previously recognised
impairment losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is
estimated. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to
determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case the carrying
amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount
that would have been determined, net of depreciation, had the impairment loss been recognised for the asset in prior
years. Such reversal is recognised in profit or loss unless the asset is carried at the re-valued amount, in which case the
reversal is treated as a revaluation increase. After such a reversal the depreciation charge is adjusted in future periods to
allocate the asset’s revised carrying amount, less any residual value, on a systematic basis over its remaining useful life.
(d) Share Based Payment Transactions
Under AASB 2 Share Based Payments, the Group must recognise the fair value of shares and options granted to directors,
employees and consultants as remuneration as an expense on a pro-rata basis over the vesting period in the Statement
of Profit or Loss and Other Comprehensive Income with a corresponding adjustment to equity.
Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. The
total expense is recognised over the vesting period, which is the period over which all of the specified vesting conditions
are to be satisfied. At the end of each period, the entity revises its estimates of the number of options that are expected
to vest based on the non-market vesting conditions. It recognises the impact of the revision to original estimates, if any,
in profit or loss, with a corresponding adjustment to equity. No revision to original estimates is made in respect of options
issued with market based conditions.
The Group provides benefits to employees (including directors) of the Group in the form of share based payment
transactions, whereby employees render services in exchange for shares or rights over shares (“equity-settled
transactions”). The cost of these equity-settled transactions with employees (including directors) is measured by
reference to fair value at the date they are granted. The fair value is determined using an appropriate option pricing model.
In relation to the valuation of the share-based payments, these are valued using an appropriate option valuation method.
Once a valuation is obtained management use an assessment as to the probability of meeting non-market based
conditions. Market conditions are vested over the period in which management assess it will take for these conditions to
be satisfied.
24
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
(e) Segment Reporting
Operating segments are reported in a manner that is consistent with the internal reporting to the chief operating decision
maker (“CODM”), which has been identified by the Group as the Managing Director and other members of the Board of
directors.
(f) Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for
disclosure purposes.
The carrying value less impairment provision of trade receivables and payables are assumed to approximately their fair
value due to their short-term nature. The fair value of financial liabilities for disclosure purposes is estimated by
discounting the future contractual cash flows at the current market interest rate that is available to the Group for similar
financial instruments.
(g) Income Tax and Other Taxes
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the
applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of
the reporting period in the countries where the Group’s subsidiaries and associates operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax
regulation is subject to interpretation. It establishes provision where appropriate on the basis of amounts expected to be
paid to the tax authorities. Adjustments to current income tax are made to take into account any change in tax rates
between the Company and its subsidiaries.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts in the financial statements. However, deferred tax liabilities are not
recognised if they arise from the initial recognition of goodwill.
Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction
other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss.
Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end
of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred
income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax
bases of investments in foreign operations where the Group is able to control the timing of the reversal of the temporary
differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and
liabilities and when the deferred tax balances relate to the same taxation authority.
25
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either
to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Auroch Minerals Limited and its wholly-owned Australian controlled entities have implemented the tax consolidation
legislation. As a consequence, these entities are taxed as a single entity and the deferred tax assets and liabilities of these
entities are set off in the financial statements.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or
directly in equity, respectively.
(h) Exploration and Evaluation Expenditure
The Group’s policy with respect to exploration and evaluation expenditure is to use the area of interest method. Under
this method exploration and evaluation expenditure is carried forward on the following basis:
i.
ii.
Each area of interest is considered separately when deciding whether, and to what extent, to carry forward or
write off exploration and evaluation costs; and
Exploration and evaluation expenditure related to an area of interest is carried forward provided that rights to
tenure of the area of interest are current and that one of the following conditions is met:
such evaluation costs are expected to be recouped through successful development and exploitation of
the area of interest or alternatively, by its sale; or
exploration and/or evaluation activities in the area of interest have not yet reached a stage which
permits a reasonable assessment of the existence or otherwise of economically recoverable reserves
and active and significant operations in relation to the area are continuing.
Exploration and evaluation costs accumulated in respect of each particular area of interest include only net direct
expenditure.
(i) Cash and Cash Equivalents
For the purposes of the statement of cash flows, cash and cash equivalents includes cash on hand, cash in bank accounts,
money market investments readily convertible to cash within two working days, and bank bills but net of outstanding bank
overdrafts.
(j) Investments and other financial assets
The Group classifies its financial assets in the following categories: loans and receivables. The classification depends on
the purpose for which the investments were acquired. Management determines the classification of its investments at
initial recognition and, in the case of assets classified as held-to-maturity, re-evaluates this designation at each reporting
date.
(i) Loans and receivables
Loans and receivables are non-derivate financial assets with fixed or determinable payments that are not quoted in an
active market. They are included in current assets, except for those with maturities greater than 12 months after the
statement of financial position date which are classified as non-current assets. Loans and receivable are included in trade
and other receivables in the statement of financial position.
Recognition and de-recognition
Investments are initially recognised at fair value plus transactions costs for all financial assets not carried at fair value
through profit or loss. Financial assets are derecognised when the rights to receive cash flows from the financial assets
have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership.
Subsequent measurement
Loans and receivables are carried at amortised cost using the effective interest method.
26
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
Impairment
The Group assesses at each reporting date whether there is objective evidence that a financial asset or Group of financial
assets is impaired.
(k) Earnings Per Share
(i) Basic Earnings Per Share
Basic earnings per share is determined by dividing the operating loss attributable to the equity holder of the Company
after income tax by the weighted average number of ordinary shares outstanding during the financial year.
(ii) Diluted Earnings Per Share
Diluted earnings per share adjusts the figures used in determination of basic earnings per share by taking into account
amounts unpaid on ordinary shares and any reduction in earnings per share that will arise from the exercise of options
outstanding during the year.
(l) Revenue recognition
Revenue is measured at fair value of the consideration received or receivable. Amounts disclosed as revenue are net of
returns, trade allowances and duties and taxes paid. The following specific recognition criteria must also be met before
revenue is recognised:
Interest income is recognised as it accrues using the effective interest method.
(m) Trade and Other Receivables
Receivables are initially recognised at fair value and subsequently measured at amortised cost, less provision for doubtful
debts. Current receivables for GST are due for settlement within 30 days and other current receivables within 12 months.
Cash on deposit is not due for settlement until rights of tenure are forfeited or performance obligations are met.
(n) Trade and Other Payables
Trade payables and other payables are carried at cost and represent liabilities for goods and services provided to the
Group prior to the end of the financial period that are unpaid and arise when the Group becomes obliged to make future
payments in respect of the purchase of these goods and services. The amounts are unsecured and usually paid within 30
days of recognition.
(o) Borrowings Cost
Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a
substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such time
as the assets are substantially ready for their intended use of sale.
All other borrowing costs are recognised as expenses in the period in which they are incurred.
(p) Goods and Service Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST except:
Where the GST incurred on the purchase of goods and services is not recoverable from the taxation authority, in
which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as
applicable; and
Receivable and payable are stated with the amount of GST included.
The amount of GST recoverable from the taxation authority is included as part of the receivables in the Statement of
financial position. The amount of GST payable to the taxation authority is included as part of the payables in the Statement
of financial position.
27
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of cash flows arising from
investing and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as
operating cash flows.
(q) Contributed Equity
Issued and paid up capital is recognised at the fair value of the consideration received by the Group. Any transaction costs
arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share proceeds received.
(r) Foreign currency translation
Functional and presentation currency
Items included in the financial statements of the Group are measured using the currency of the primary economic
environment in which the Group operates (‘the functional currency). The consolidated financial statements are presented
in Australian dollars, which is the Group’s functional and presentation currency.
Group companies
The results and financial position of foreign operations (none of which has the currency of a hyperinflationary economy)
that have a functional currency different from the presentation currency are translated into the presentation currency as
follows:
assets and liabilities for each Statement of Financial Position presented are translated at the closing rate at the
date of that Statement of Financial Position.
income and expenses for each Statement of Profit or Loss and Other Comprehensive Income are translated at
average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates
prevailing on the transaction dates, in which case income and expenses are translated at the dates of the
transactions), and
all resulting exchange differences are recognised in other comprehensive income.
On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of
borrowings and other financial instruments designated as hedges of such investments, are recognised in other
comprehensive income. When a foreign operation is sold or any borrowings forming part of the net investment are repaid,
a proportionate share of such exchange difference is reclassified to profit or loss, as part of the gain or loss on sale where
applicable.
Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of
the foreign operation and translated at the closing rate.
Transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the dates of
the transactions. Foreign currency monetary assets and liabilities at the reporting date are translated at the exchange
rate existing at reporting date. Exchange differences are recognised in profit or loss in the period in which they arise.
No dividends were paid or proposed during the year.
(s) Parent entity information
The financial information for the parent entity, disclosed in Note 26 has been prepared on the same basis as the
consolidated financial statements, except as set out below.
(i) Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries are accounted for at cost in the financial statements. Dividends received from associates are
recognised in the parent entity’s profit or loss when its right to receive the dividend is established.
(t) Standards and Interpretations in issue not yet adopted
At the date of authorisation of the financial report, a number of Standards and Interpretations including those Standards
and Interpretations issued by the IASB/IFRIC, where an Australian equivalent has not been made by the AASB, were in
28
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
issue but not yet effective for which the Entity has considered it unlikely for there to be a material impact on the financial
statements.
AASB reference
AASB 9 (issued
Title and
Affected
Standard(s):
Financial
Nature of Change
Application
Impact on Initial Application
date:
Amends the requirements for classification and
Annual
Adoption of AASB 9 is only
December 2009 and
Instruments
measurement of financial assets. The available-
reporting
mandatory for the year
amended December
for-sale and held-to-maturity categories of
periods
ending 30 June 2018.
2010)
financial assets in AASB 139 have been
beginning on
eliminated. Under AASB 9, there are three
or after 1
The entity does not currently
categories of financial assets:
January
have any financial
Amortised cost
20172
instruments.
Fair value through profit or loss
Fair value through other comprehensive
income.
The following requirements have generally been
carried forward unchanged from AASB 139
Financial Instruments: Recognition and
Measurement into AASB 9:
Classification and measurement of financial
liabilities; and
Derecognition requirements for financial
assets and liabilities.
However, AASB 9 requires that gains or losses on
financial liabilities measured at fair value are
recognised in profit or loss, except that the
effects of changes in the liability’s credit risk are
recognised in other comprehensive income.
2 The application date of AASB 9 has been deferred from annual periods beginning on or after 1 January 2015 to annual periods b eginning on or after 1 January 2017
by AASB 2013-9 Amendments to Australian Accounting Standards - Conceptual Framework, Materiality and Financial Instruments.
29
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
AASB reference
Title and
Nature of Change
Application
Impact on Initial Application
Affected
Standard(s):
date:
AASB 15 Revenue from
Revenue
The standard provides a single standard for
Annual
The consolidated entity will
Contracts with
Customers
revenue recognition. The core principle of the
reporting
adopt this standard from 1
standard is that an entity will recognise revenue
periods
July 2017 but the impact of
to depict the transfer of promised goods or
beginning on
its adoption is yet to be
services to customers in an amount that reflects
or after 1
assessed by the consolidated
the consideration to which the entity expects to
January 2017
entity.
be entitled in exchange for those goods or
services. The standard will require: contracts
(either written, verbal or implied) to be
identified, together with the separate
performance obligations within the contract;
determine the transaction price, adjusted for the
time value of money excluding credit risk;
allocation of the transaction price to the separate
performance obligations on a basis of relative
stand-alone selling price of each distinct good or
service, or estimation approach if no distinct
observable prices exist; and recognition of
revenue when each performance obligation is
satisfied. Credit risk will be presented separately
as an expense rather than adjusted to revenue.
For goods, the performance obligation would be
satisfied when the customer obtains control of
the goods. For services, the performance
obligation is satisfied when the service has been
provided, typically for promises to transfer
services to customers. For performance
obligations satisfied over time, an entity would
select an appropriate measure of progress to
determine how much revenue should be
recognised as the performance obligation is
satisfied.
30
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
AASB reference
Title and
Affected
Standard(s):
Nature of Change
Application
Impact on Initial
date:
Application
Contracts with customers will be
presented in an entity's statement of
financial position as a contract liability, a
contract asset, or a receivable, depending
on the relationship between the entity's
performance and the customer's
payment. Sufficient quantitative and
qualitative disclosure is required to
enable users to understand the contracts
with customers; the significant judgments
made in applying the guidance to those
contracts; and any assets recognised from
the costs to obtain or fulfil a contract with
a customer.
AASB 16
Leases
This standard and its consequential
Effective for
The entity has not yet made an
amendments are applicable to annual
periods beginning
assessment of the impact of
reporting periods beginning on or after 1
on or after 1 July
these amendments.
January 2019. This Standard sets out the
2019
principles for the recognition,
measurement, presentation and
disclosure of leases. The objective is to
ensure that lessees and lessors provide
relevant information in a manner that
faithfully represents those transactions.
This information gives a basis for users of
financial statements to assess the effect
that leases have on the financial position,
financial performance and cash flows of
an entity.
2. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
In preparing these Financial Statements the Group has been required to make certain estimates and assumptions
concerning future occurrences. There is an inherent risk that the resulting accounting estimates will not equate exactly
with actual events and results.
(a) Significant accounting judgements
In the process of applying the Group’s accounting policies, management has made the following judgements, apart from
those involving estimations, which have the most significant effect on the amounts recognised in the financial statements.
31
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
2. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued)
Capitalisation of exploration and evaluation expenditure
The Group has capitalised exploration and evaluation expenditure on the basis either that this is expected to be
recouped through future successful development (or alternatively sale) of the Areas of Interest concerned or on the
basis that it is not yet possible to assess whether it will be recouped. Refer to note 10 for further details.
Receivables
Collectability of trade and other receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible
are written off. An allowance account (provision for impairment of trade receivables) is used when there is objective
evidence that the Company will not be able to collect all amounts due according to the original terms of the receivables.
The amount of the allowance is the difference between the asset’s carrying amount and the present value of estimated
future cash flows, discounted at the original effective interest rate. Cash flows relating to short-term receivables are not
discounted if the effect of discounting is immaterial. The amount of the allowance is recognised as impairment in the
statement of profit or loss and other comprehensive income. The Directors have reviewed the amounts owing in respect
of the deferred consideration on the sale of the Manica asset and the funds advanced to Bolt Resources Pty Ltd as
disclosed in note 8 and are satisfied amounts are fully recoverable.
(b) Significant accounting estimates and assumptions
The carrying amount of certain assets and liabilities are often determined based on estimates and assumptions of future
events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying
amounts of certain assets and liabilities within the next annual reporting period are:
Impairment of capitalised exploration and evaluation expenditure
The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of factors,
including whether the Group decides to exploit the related lease itself or, if not, whether it successfully recovers the
related exploration and evaluation asset through sale.
Factors that could impact the future recoverability include the level of reserves and resources, future technological
changes, costs of drilling and production, production rates, future legal changes (including changes to environmental
restoration obligations) and changes to commodity prices.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined using the Black Scholes model. Should
the assumptions used in these calculations differ, the amounts recognised could significantly change. Details of estimates
used can be found in Note 20.
3. REVENUE
From continuing operations
Gain on disposal of non current asset
Interest received
Total
2017
$
2016
$
254,970
242,275
497,245
-
43,893
43,893
32
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
4. EXPENSES
Profit/Loss includes the following specific expenses:
Consultants and advisory fees
Advertising and Marketing
Share registry costs
Depreciation
5. TAXATION
The components of tax expense comprise:
Current tax
Deferred tax
The prima facie tax payable/(benefit) on profit/(loss) from ordinary activities before
income tax is reconciled to the income tax as follows:
Profit/(Loss) before income tax
Profit/(Loss) before income tax from discontinued operations
Prima facie tax benefit on loss from continuing activities before income tax at 27.5%
(2016: 30%)
Add/(subtract) tax effect of:
Expenditure not deductible
Other
Deferred tax assets relating to tax losses not recognised
Adjustments relating to Mozambique capital gains tax
Foreign tax rate differential
Total income tax expense
The franking account balance at year end was $nil.
Deferred tax assets and liabilities not recognised relate to the following:
Deferred tax assets
Tax losses
Other temporary differences
Capital loss
Exploration expenditure
Net deferred tax assets
2017
$
2016
$
446,832
21,601
12,773
2,527
452,834
1,768
10,335
-
2017
$
2016
$
-
-
-
847,355
-
847,355
(1,919,686)
-
(2,603,629)
5,961,525
(527,914)
1,007,369
402,400
652,715
125,514
-
-
-
167,476
(1,033,165)
52,960
847,355
1,411,878
-
54,564
-
1,466,442
1,255,772
56,984
41,672
(50,851)
1,303,577
33
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
6. PROFIT/LOSS PER SHARE
(a) Profit/(loss) per share
Profit/(loss) attributable to the ordinary equity holders of the Group
(b) Reconciliations of profit/loss used in calculated loss per share
Basic and diluted profit/loss per share
Diluted profit/loss per share
(c) Weighted average number of shares used as a denominator
Weighted average number of ordinary shares used as the denominator in calculating
basic loss per share
7. CASH AND CASH EQUIVALENTS
Deposits at call
Cash at bank
The Group’s exposure to interest rate risk is discussed in Note 17.
Financial Guarantees
The Group has provided no financial guarantees.
8. TRADE AND OTHER RECEIVABLES
Deferred consideration on sale of Manica asset
Prepayments
Advance of Funds to Bolt Resources Pty Ltd
Other receivables
Ageing of receivables past due or impaired
The Group’s exposure to credit risk is discussed in Note 17.
2017
$
2016
$
(1,919,686)
2,701,923
(2.36)
(2.36)
4.12
2.62
81,259,014
65,531,281
2017
$
1,085,332
3,705,504
4,790,836
2016
$
31,514
5,192,104
5,223,618
2017
$
1,327,366
1,057
1,605,933
48,840
2,983,196
2016
$
3,359,075
578
-
33,110
3,392,763
The deferred consideration receivable relates to the Groups disposal of the Manica gold project to Xtract Resources PLC.
The remaining balance is outstanding.
The Company is in discussions with Xtract in relation to settlement of the remaining US$1,000,000 plus interest owed to
it and envisages that following completion of the discussions between Xtract, a resolution will be reached on the final
Instalment. Security over the loan is held in that the loan can be converted into shares at a discount to market and
realised through the sale of those shares. The directors are satisfied that the remaining receivable is fully recoverable.
34
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
8. TRADE AND OTHER RECEIVABLES (continued)
Bolt Resources Pty Ltd is the holder of the Alcoutim license in Portugal. Subject to the Conditions being satisfied or waived,
Auroch will subscribe for fully paid ordinary shares in Bolt Resources Pty Ltd comprising 65% of all Bolt Resources Pty Ltd
shares then on issue. Subscription of the shares is based on the following conditions:
A) Bolt Resources Pty Ltd successfully renewing the Prospecting Licence for an additional 12 months
commencing on 23 September 2017; and
B) if any such renewal is granted subject to conditions not already applicable to the Prospecting Licence at the
date the agreement, those new conditions being satisfactory to Auroch, acting reasonably, on or before 31
December 2017
All formal documents have been submitted for the application of the Prospecting license renewal to Portuguese licensing
authorities. The directors are satisfied that the loan receivable is fully recoverable.
9. PROPERTY PLANT AND EQUIPMENT
Office Equipment
Less Accumulated Depreciation on Office Equipment
Vehicles
Less Accumulated Depreciation on Vehicles
Balance at the end of the year
10. EXPLORATION AND EVALUATION EXPENDITURE
Balance at beginning of the year
Exploration expenditure incurred
Exploration expenditure written off
Balance at the end of the year
2017
$
2016
$
1,320
(163)
21,648
(2,363)
20,442
-
-
-
-
-
2017
$
171,507
96,301
(230,702)
37,106
2016
$
206,866
521,175
(556,534)
171,507
The balance carried forward represents projects in the exploration and evaluation phase. Ultimate recoupment of
exploration expenditure carried forward is dependent on successful development and commercial exploitation, or
alternatively, sale of respective areas.
11. TRADE AND OTHER PAYABLES
Trade payables
Accruals
2017
$
87,342
24,000
111,342
2016
$
88,565
43,525
132,090
All current liabilities are expected to be settled within 12 months as they are generally due on 30-60 day terms.
The Group’s exposure to credit risk is discussed in Note 17.
35
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
12. CONTRIBUTED EQUITY
(a) Share Capital
Fully paid
Equity raising costs
2017
2016
Shares
85,817,551
-
85,817,551
Shares
76,810,865
-
76,810,865
2017
$
2016
$
10,505,039 10,192,746
(674,044)
9,518,702
(37,500)
10,467,539
(b) Movements in ordinary shares (including equity raising costs)
2017
Date
01/07/16
16/12/16
16/12/16
20/12/16
30/1/17
17/2/17
24/3/17
10/05/17
30/06/17
Details
Balance at 01 July
Issue of Placement Shares
Issue of shares in settlement of DD Services
provided to company
Equity raising costs
Issue of shares in lieu of consultants fees
Exercise of options
Exercise of options
Shares issued in lieu of consultant fees
Balance at 30 June
(b) Movements in ordinary shares (including equity raising costs)
2016
Date
01/07/15
03/07/15
Details
Balance at 01 July
Shares issued in lieu of corporate advisory
services
Issue of shares on conversion of debt and
shares issued to employees and unrelated
contractors in satisfaction of remuneration,
fees and employee entitlement forgone
Share issued upon conversion of Convertible
Note
Share issued upon conversion of Convertible
Note
Share issued to former employees and
unrelated contractors
Shares issued upon exercise of options
Shares issued upon exercise of options
Shares issued pursuant to share sale
agreement to acquire project
23/10/15
23/10/15
18/03/16
18/03/16
29/04/16
23/05/16
25/05/16
36
Number of
shares
76,810,865
7,500,000
Issue
price
$0.10
675,000
$0.15
233,334
287,305
186,749
124,299
85,817,552
$0.15
$0.08
$0.08
$0.50
2017
$
9,518,702
$750,000
$101,250
(37,500)
$35,000
$22,985
$14,940
$62,162
10,467,539
Number of
shares
58,591,397
Issue
price
2016
$
7,743,958
102,564
$0.11
11,282
1,850,000
$0.09
173,900
3,350,723
$0.08
250,000
8,702,461
$0.09
750,000
1,660,000
1,090,000
125,000
$0.11
$0.20
$0.15
182,600
218,000
18,750
950,000
$0.15
142,500
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
12. CONTRIBUTED EQUITY (continued)
14/06/16
30/06/16
Shares issued in settlement of former
employee entitlements
Shares issued upon exercise of options
Equity raising costs
Balance at 30 June
250,000
138,720
$0.14
$0.08
76,810,865
35,000
11,098
(18,386)
9,518,702
(d) Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Group in proportion
to the number of shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote,
and upon a poll each share is entitled to one vote.
(e) Capital risk management
The Group’s objective when managing working capital is to safeguard the ability to continue as a going concern, so that it
can continue to provide returns for the shareholders and benefits for other stakeholders and to maintain an optimal
capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the return of capital to shareholders, issue new
shares or sell assets to reduce debt. The Group defines capital as cash and cash equivalents plus equity.
The Board of Directors monitors capital on an ad-hoc basis. No formal targets are in place for return on capital, or
gearing ratios, as the Group has not derived any income from their mineral exploration and currently has no debt
facilities in place.
13. RESERVES
(a) Reserves
Share-based payments reserve
Options reserve
Share-based payments reserve
Balance 1 July
Share based payments
Balance 30 June
Option reserve
Balance 1 July
Options issued
Balance 30 June
37
2017
$
2016
$
194,347
230,117
424,464
2017
$
194,347
-
194,347
2017
$
194,828
35,289
230,117
194,347
194,828
389,175
2016
$
115,533
78,814
194,347
2016
$
-
194,828
194,828
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
13. RESERVES (continued)
Foreign currency translation reserve
Balance 1 July
Foreign currency translation difference on consolidation
Reclassification of exchange differences on disposal of controlled entities to Profit or
Loss
Balance 30 June
Nature and purpose of reserves
(i) Share-based payments reserve
The share based payments reserve is used to recognise:
The fair value of options issued to employees and consultants but not exercised
The fair value of shares issues to employees
2017
$
2016
$
-
-
-
(191,382)
-
191,382
-
(ii) Foreign currency translation reserve
Exchange differences arising on translation of foreign controlled entities are recognised in other comprehensive income
and accumulated in a separate reserve within equity. The cumulative amount is reclassified to profit or loss when the net
investment is disposed of.
(iii) Option reserve
The Share Option Reserve contains amounts received on the issue of options over unissued capital of the company.
14. ACCUMULATED LOSSES
Accumulated losses at the beginning of the period
Net profit/loss attributable to members of the Group
Accumulated losses at the end of the financial year
2017
$
(1,252,079)
(1,919,686)
(3,171,765)
2016
$
(3,762,620)
2,510,541
(1,252,079)
15. RECONCILATION OF LOSS AFTER INCOME TAX TO NET CASH INFLOW FROM OPERATING ACTIVITIES
Profit/Loss for the year
Gain on disposal of non-current asset
Depreciation and amortisation
Finance and interest expense
Non-cash employee benefits expense – share-based payments
Impairment of capitalised expenditure
Foreign exchange loss
(Increase)/decrease in trade debtors and other receivables
Increase/(decrease) in trade creditors and other payables
Net cash outflow from operating activities
38
2017
$
(1,919,686)
(452,257)
2,527
-
248,498
230,702
189,415
(16,209)
(20,748)
(1,737,758)
2016
$
2,510,541
(5,961,525)
-
130,205
265,563
556,534
482,780
2,589,426
(2,189,975)
(1,616,451)
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
16. REMUNERATION OF AUDITORS
Amounts received or due and receivable by the auditors for:
Audit services:
BDO Audit (WA) Pty Ltd Audit and review of financial reports under the
Corporations Act 2001
Non audit services
2017
$
33,883
24,847
58,730
2016
$
49,425
34,454
83,879
17. FINANCIAL RISK MANAGEMENT
Overview
The Group has exposure to the following risks from their use of financial instruments:
a) credit risk
b) liquidity risk
c) market risk
This note presents information about the Group’s exposure to each of the above risks, their objectives, policies and
processes for measuring and managing risk, and the management of capital.
The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework.
Management monitors and manages the financial risks relating to the operations of the Group through regular reviews of
the risks.
(a) Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its
contractual obligations, and for the Group arises principally from cash and cash equivalents and receivables.
All cash balances are held with recognised institutions limiting the exposure to credit risk. There are no formal credit
approval processes in place.
Exposure to credit risk
The carrying amount of the Group’s financial assets represents the maximum credit exposure. The Group’s maximum
exposure to credit risk at the reporting date was:
Cash and cash equivalents
Receivables
2017
$
4,790,836
2,983,196
7,774,033
2016
$
5,223,618
3,392,185
8,615,803
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit
ratings (if available) or to historical information about default rates.
Financial assets that are neither past due and not impaired are as follows:
Cash and cash equivalents
AA S&P rating
4,790,836
4,790,836
5,223,617
5,223,617
As disclosed in note 8, the company has a receivable due from Xtract Resources PLC that is due as at 31 December 2017.
39
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
17. FINANCIAL RISK MANAGEMENT (continued)
(b) Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking
damage to the Group’s reputation. The Group manages liquidity risk by maintaining adequate reserves by continuously
monitoring forecast and actual cash flows. The Group anticipates a need to raise additional capital in the next 12 months
to meet forecasted operational activities. The decision on how the Group will raise future capital will depend on market
conditions existing at that time.
Typically, the Group ensures that it has sufficient cash on demand to meet expected operational expenses for a period of
60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that
cannot reasonably be predicted, such as natural disasters.
The Group has no access to credit standby facilities or arrangements for further funding or borrowings in place.
The financial liabilities the Group had at reporting date were trade payables incurred in the normal course of the business.
These were non-interest bearing and were due within the normal 30-60 days terms of creditor payments.
Maturities of financial liabilities
The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period
at the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual
undiscounted cash flows.
17. FINANCIAL RISK MANAGEMENT (continued)
Less than
6 months
$
6-12
months
$
1-2 years
$
2-5
years
$
Over 5
years
$
Total
contractual
cash flows
$
Carrying
amount
(assets)/
liabilities
$
As at 30 June 2017
Trade and other payables
111,342
-
-
-
-
111,342
111,342
Less than
6 months
$
6-12
months
$
1-2 years
$
2-5
years
$
Over 5
years
$
Total
contractual
cash flows
$
Carrying
amount
(assets)/
liabilities
$
As at 30 June 2016
Trade and other payables
132,090
-
-
-
-
132,090
132,090
(c) Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will
affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management
is to manage and control market risk exposures within acceptable parameters, while optimising the return.
40
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
17. FINANCIAL RISK MANAGEMENT (continued)
(i) Currency risk
Foreign exchange risk arises when future commercial transactions and recognised assets and liabilities are denominated
in a currency that is not the entity’s functional currency.
The Group did not have any formal policies in place regarding currency risk during the year as it was not considered
significant. This will be monitored as appropriate going forward and introduced as necessary.
The groups exposure to foreign currency risk at the end of the reporting period, expressed in Australian dollar, was as
follows:
Cash and cash equivalents
Deferred consideration
Trade and other receivables
Trade and other payables
Cash and cash equivalents
Cash and cash equivalents
Sensitivity analysis
Cash and cash equivalents
Trade and other payables
2017
USD
$
1,042,756
1,000,000
-
-
2017
GBP
$
-
2017
EUR
$
50,000
2016
USD
$
2,154,705
2,500,000
-
7,040
2016
GBP
$
1,165,020
2016
EUR
$
-
2017
Foreign exchange risk
2016
Foreign exchange risk
+ 1%
1,043
-
- 1%
+ 1%
-1%
(1,043)
-
21,547
70
(21,547)
(70)
1,043
(1,043)
21,617
(21,617)
(ii) Cashflow and interest rate risk
The Group’s only interest rate risk arises from cash and cash equivalents held. Term deposits and current accounts held
with variable interest rates expose the Group to cash flow interest rate risk. The Group does not consider this risk to be
material and has therefore not undertaken any further analysis of risk exposure for 2017.
(d) Fair values
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for
disclosure purposes.
41
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
17. FINANCIAL RISK MANAGEMENT (continued)
The Fair value of financial instruments that are not traded in an active market (for example investments in unlisted
subsidiaries) is determined using valuation techniques.
The carrying value less impairment of trade receivables and payables are assumed to approximate their fair values due to
their short-term nature.
The carrying amounts are estimated to approximate fair values of financial assets and financial liabilities as follows:
Financial Assets
Cash and cash equivalents
Trade and other receivables
Total Financial Assets
Financial Liabilities
Trade and other payables
Borrowings
Financial liabilities
Total Financial Liabilities
2017
$
2016
$
4,790,836
2,983,196
7,774,032
5,223,618
3,392,185
8,615,803
111,342
-
-
111,342
132,090
-
-
132,090
The methods and assumptions used to estimate the fair value of financial instruments are outlined below:
Cash/financial liabilities and loans
The carrying amount is fair value due to the liquid nature of these assets.
Receivables/payables
Due to the short term nature of these financial rights and obligations, their carrying amounts are estimated to
represent their fair values.
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for
disclosure purposes.
Due to their short term nature, the carrying amount of the current receivables and current payables is assumed to
approximate their fair value.
Refer to note 18 for further details.
18. FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS
The carrying values of financial assets and liabilities of the Group approximate their fair values. Fair values of financial
assets and liabilities have been determined for measurement and / or disclosure purposes.
Fair value hierarchy
The Group classifies assets and liabilities carried at fair value using a fair value hierarchy that reflects the significance of
the inputs used in determining that value. The following table analyses financial instruments carried at fair value by the
valuation method. The different levels in the hierarchy have been defined as follows:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly (as prices) or indirectly (derived from prices); and
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
42
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
18. FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS (continued)
Due to their short term nature, the carrying values of all of the Group’s financial assets and liabilities is assumed to be
their fair value. That is, there are no financial assets or financial liabilities measured using the fair value hierarchy.
19. SEGMENT INFORMATION
Management has determined that the Group has two reportable segments, being mineral exploration in Namibia and
Western Australia, which is based on the internal reports that are reviewed and used by the Board of Directors (chief
operating decision makers) in assessing performance and determining the allocation of resources. As the Group is focused
on mineral exploration, the Board monitors the Group based on actual versus budgeted exploration expenditure incurred
by area of interest.
This internal reporting framework is the most relevant to assist the Board with making decisions regarding the Group and
its ongoing exploration activities, while also taking into consideration the results of exploration work that has been
performed to date.
Segment information relating to the reportable segment being mineral exploration in Mozambique and Western Australia
is outlined below.
2017
Revenue from external sources
Reportable segment profit / (loss)
Reportable segment assets
19. SEGMENT INFORMATION (continued)
Reportable segment liabilities
Reconciliation of reportable segment profit or loss
Reportable segment profit /(loss)
Other income
Unallocated:
Other income
Depreciation expense
Director benefits
Share buy-back
Employee benefits
Other expenses
Profit before tax
Namibia
$
Western
Australia
$
-
-
37,106
Namibia
$
-
-
-
-
Western
Australia
$
-
Total
$
-
-
37,106
Total
$
-
-
497,245
(2,527)
(98,214)
0
(263,422)
(2,052,769)
(1,919,687)
-
-
-
-
-
43
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
19. SEGMENT INFORMATION (continued)
2016
Revenue from external sources
Reportable segment profit / (loss)
Reportable segment assets
Reportable segment liabilities
Reconciliation of reportable segment profit or loss
Reportable segment profit /(loss)
Other income
Unallocated:
Other income
Depreciation expense
Director benefits
Share buy-back
Employee benefits
Other expenses
Profit before tax
Other Segment Information
Total segment revenue
Interest revenue
Total revenue from continuing operations
Segment assets
Unallocated:
Cash and cash equivalents
Trade and other receivables
Property Plant & Equipment
Mineral exploration and evaluation
Loan Receivable
Total assets as per the statement of financial position
Segment liabilities are reconciled to total liabilities as follows:
Segment Liabilities
Unallocated:
Trade and other payables
Borrowings
Total liabilities as per the statement of financial position
44
Mozambique
$
-
5,114,170
-
-
Western
Australia
$
-
-
169,502
-
-
-
Total
$
-
5,114,170
169,502
-
5,114,170
-
43,893
-
(18,887)
-
(25,000)
(2,603,635)
2,510,541
2017
$
254,970
242,275
497,245
2016
$
42,715
1,178
43,893
37,106
169,505
4,790,836
1,377,263
20,442
-
1,605,933
7,831,580
5,223,618
3,392,763
2,001
-
8,787,887
-
-
111,342
-
111,342
132,090
-
132,090
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
20. SHARE BASED PAYMENT TRANSACTIONS
Share Based Payments
(a) Options
There have been no options issued to current directors and executives as part of their remuneration.
On 24 March 2017 300,000 unlisted options were issued during the year to a third party contractor as settlement of fees
outstanding. The options have an exercise price of 20 cents each and expire on 24 March 2019.
The unlisted option reserve records items recognised on valuation of director, employee and contractor share options as
well as share options issued during the course of a business combination. Information relating to the details of options
issued, exercised and lapsed during the financial year and options outstanding at the end of the financial year, is set out
in note 12.
The assessed fair values of the options were determined using a Black-Scholes option pricing model, taking into account
the exercise price, term of option, the share price at grant date and expected price volatility of the underlying share,
expected dividend yield and the risk-free interest rate for the term of the option.
The inputs to the model used were:
24 March 2017
Dividend Yield
Expected volatility (%)
Risk-free interest rate (%)
Expected life of options (years)
Option exercise price ($)
Share price at grant date ($)
Value of option ($)
-
95
2.5
2.0
0.20
0.22
0.01176
The expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that may
occur. The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which
may also not necessarily be the actual outcome.
Employee Share Plan
The Auroch Minerals Limited Employee Share Plan is used to reward Directors and employees for their performance and
to align their remuneration with the creation of shareholder wealth. There are no performance requirements to be met
before exercise can take place. The Plan is designed to provide long-term incentives to deliver long-term shareholder
returns. Participation in the Plan is at the discretion of the Board and no individual has a contractual right to participate in
the plan or to receive any guaranteed benefits.
21. DIVIDENDS
Share based payments transactions are recognised at fair value in accordance with AASB 2. The adoption of AASB 2 is
equity-neutral for equity-settled transactions.
Numbers of Employee Shares were issued this year is nil (2016: nil).
There were no dividends paid or declared by the Group during the year (2016: Nil).
45
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
22. EVENTS OCCURRING AFTER REPORTING DATE
On 3 July 2017 the company advised it entered into option agreements giving it the right to acquire 100% of the historic
Tisová copper mine and 3 exploration licence applications (subject to approval by relevant authorities) in the Czech
Republic.
The material commercial terms of the option agreements for 100% of the project are summarised below:
Option Period – 9 months (to be extended if Auroch is not able to complete its due diligence and work
programme commitment within the initial 9-month period due to matters outside of Auroch’s control, including
weather and permitting issues)
On execution of the Options, Auroch is obliged to reimburse the vendors of the Czech permit and applications
for approx. A$75,000 in costs incurred by the vendors
Work programme commitment
During the Option Period, Auroch will complete 4 holes (approx. 1,200m total) to confirm spatial distribution of
Co and Cu (also Au Ag) on the Czech permits
Upon the exercise of the Options within the Option Period, the following payments will be made to the vendors of the
Czech permit and applications:
Cash payment of A$75,000 on completion
4,375,000 fully paid ordinary shares to be issued on completion
Deferred consideration of 5,000,000 addition fully paid ordinary shares to be issued (subject to shareholder
approval) on:
o a decision to mine on the project area;
o a change of control of Auroch (unless Auroch elects to return the project to the vendors for nil
consideration); or
o a sale of the project.
23. CONTINGENCIES
Contingent Liabilities
The Group had no other material contingent assets or liabilities at 30 June 2017.
Commitments
The Group had no material commitments at 30 June 2017.
24. SUBSIDIARIES
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries:
Name of entity
Country of
Incorporation
Class of
shares
Note
Auroch Exploration Pty Ltd1
Auroch Europe Pty ltd2
Auroch Exploration (UK) Ltd3
Auroch Minerals (Namibia) (Pty)
Limited4
Australia
Australia
United Kingdom
Namibia
Ordinary
Ordinary
Ordinary
Ordinary
46
Equity
holding
2017
100%
100%
100%
100%
Equity
holding
2016
-
-
-
-
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
24. SUBSIDIARIES (continued)
Auroch Exploration (Namibia)
(Pty) Ltd5
Auroch Namibia Exploration One
(Pty) Ltd6
Auroch Namibia Exploration
Number Two (Pty) Ltd7
Auroch Minerals Mozambique
Pty Ltd8
Auroch Minerals SA Proprietary
Limited9
Namibia
Ordinary
Namibia
Ordinary
Namibia
Ordinary
Australia
Ordinary
South Africa
Ordinary
95%
100%
100%
-
-
-
-
-
100%
100%
1 Holding company for Auroch Exploration (UK) Ltd
2 Dormant subsidiary
3 Holding Company for Auroch Minerals (Namibia) (Pty) Limited
4 Holding Company for Auroch Exploration (Namibia) (Pty) Ltd, Auroch Namibia Exploration One (Pty) Ltd and Auroch
Namibia Exploration Number Two (Pty) Ltd
5 Holder of EPL 6840, EPL 6841, EPL 6482, EPL 6483 and EPL 6484
6 Holder of EPL 5751
7 Dormant subsidiary
8 Holding company for Mistral Development Corporation Ltd.
9 Dormant subsidiary
25. RELATED PARTY TRANSACTIONS
(a) Parent entities
The parent entity within the Group is Auroch Minerals Limited. The ultimate parent entity and ultimate controlling party
is Auroch Minerals Limited (incorporated in Australia) which at 30 June 2017 owns 100% of the issued ordinary shares of
the above subsidiaries.
(b) Subsidiaries
Interests in subsidiaries are set out in note 24.
(c) Key management personnel
(i) Key Management Personnel Compensation
Short-term employee benefits
Post-employment benefits
Share-based payments
2017
$
672,922
-
-
672,922
2016
$
326,585
-
16,450
343,035
(ii) Other transactions with Key Management Personnel
Mr Glenn Whiddon was paid a bonus of $50,000 in respect of thee Manica asset sale transaction.
Mr Mattew Foy is a director of Minerva Corporate Pty Ltd. During the period ended 30 June 2017 the Company was
providing consultancy, company secretarial, accounting and administration and registered office services to Auroch
Minerals Limited. In accordance with the services agreement the monthly charge for these services is $8,000 per month.
Payments to Minerva Corporate Pty Ltd during the relevant period total $93,187 (2016: $116,500). The amounts owed to
Minerva Corporate Pty Ltd as at 30 June 2017 was nil (2016: $9,000).
47
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
25. RELATED PARTY TRANSACTIONS (continued)
Mr James Bahen is joint company secretary of Calima Energy Limited. During the period ended 30 June 2016 the Company
was providing consultancy, company secretarial, accounting and administration services to Auroch Minerals Limited.
Payments to Calima Energy during the relevant period total $13,703 (2016: nil). The amounts owed to Calima Energy
Limited as at 30 June 2017 was $13,703 (2016: nil).
(d) Outstanding balances arising from sales/purchases of goods and services
There is an outstanding balance arising from services provided by Calima Energy Limited of $13,703. Mr James Bahen was
Company Secretary of Auroch Minerals Limited and joint Company Secretary of Calima Energy Limited during the period.
26. PARENT ENTITY INFORMATION
The following details information related to the parent entity, Auroch Minerals Limited, at 30 June 2017. The information
presented here has been prepared using consistent accounting policies as presented in Note 1.
Current Assets
Non-Current Assets
TOTAL ASSETS
Current Liabilities
Non-Current Liabilities
TOTAL LIABILITIES
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
Loss for the year
Other Comprehensive loss for the year
TOTAL COMPREHENSIVE LOSS FOR THE YEAR
2017
$
4,385,903
57,173
4,443,076
2,117,210
-
2,117,210
10,467,539
424,464
(8,566,137)
2,325,866
(2,173,631)
-
(2,173,631)
2016
$
3,474,168
171,507
3,645,675
132,090
-
132,090
9,518,702
253,937
(6,257,054)
3,515,585
(2,545,959)
-
(2,545,959)
At reporting date, the parent entity has nil guarantees and contingent liabilities (2016: Nil).
27. DISCONTINUED OPERATIONS
No operations were discontinued during the 2017 year.
In the prior year Company advised it had entered into a binding agreement to sell 100% of the Manica mining Concession
3990C to AIM-listed Xtract Resources Plc (Xtract or XTR) for total sale consideration of US$10 million in a combination of
cash and equity in Xtract, plus the assumption of project related creditors of up to US$1.5 million (Agreement).
The Agreement was conditional upon Auroch obtaining prior consent of the Government of Mozambique through the
Ministry of Mineral Resources and Energy to the extent required under the Mozambique Mining Act and other applicable
laws relating to the change of control of the Company’s subsidiary and communicating such change of control to the
Mozambican mining authorities. Completion of the Agreement was also subject to Auroch obtaining shareholder approval
under ASX Listing Rule 11.2 for the sale of the Manica Mining Concession and Xtract obtaining approval for the admission
of the Consideration Shares to trading on AIM.
48
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
27. DISCONTINUED OPERATIONS (continued)
On 2 March 2016 the Company advised that final approval had been received under the Mozambique Mining Act from
the Mozambique Mining Act from the Mozambican mining authorities in addition to the earlier approvals from the Central
Bank and the Ministry of Taxation, permitting the completion of the sale of 100% of the Manica Gold Project to Xtract
(Completion).
The final terms of the Agreement with Xtract are as follows:
- Cash payment at Completion of ~A$4.2 million3 (US$3.0 million); and
-
Issue of 1,137,258,065 XTR Shares (currently valued at ~A$4.22 million4) (Completion Consideration).
Consideration to be paid 3 months post Completion:
- Deferred cash consideration of ~A$3.5million5 (US$2.5 million) payable as follows:
US$1.3 million cash; and
the remaining US$1.2 million will be payable in cash or XTR Shares (at Auroch’s election), issued at a 20%
discount to the 10-day VWAP prior to Auroch’s election.
Results of discontinued operations
Revenue
Cost of sales
Other expenses
Results from operating activities
Income tax (expense)/benefit
Results from operating activities after tax
Gain on sale of subsidiary assets (i)
Profit on sale of discontinued operations
(i) Gain on sale of subsidiary assets
Assets and liabilities disposed of
Cash and cash equivalents
Exploration asset
Trade and other payables
Foreign exchange reserve
Sale consideration
Cash
Deferred consideration
3 Assumes 1 US Dollar equals 1.40 Australian Dollars
4 Assumes 1 British Pound equals 1.95 Australian Dollars and an Xtract share price of £0.0019
5 Assumes 1 US Dollar equals 1.40 Australian Dollars
49
2017
$
2016
$
2017
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(5,345)
(5,345)
-
(5,345)
5,966,870
5,961,525
2016
$
163,900
5,828,628
(132,459)
394,773
6,254,842
5,968,720
3,359,075
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
27. DISCONTINUED OPERATIONS (continued)
Xtract Plc shares (net proceeds)
Gain on sale of subsidiary assets
Cashflows gained from/ (used in) discontinued operations
Net cash gained from investing activities
Net cash flow for the year
2017
$
2016
$
2,893,917
12,221,712
5,966,870
4,480,717
4,480,717
-
-
-
-
-
50
AUROCH MINERALS LIMITED
NOTES TO THE CONSOLIDATED FIANCIAL STATEMENTS
FOR THE YEAR ENEDED 30 JUNE 2017
AUROCH MINERALS LIMITED
ACN 119 267 391
DECLARATION BY DIRECTORS
The directors of the Group declare that:
1. The financial statements, comprising the consolidated statement of profit or loss and other comprehensive
income, consolidated statement of financial position, consolidated statement of cash flows, consolidated
statement of changes in equity and accompanying notes, are in accordance with the Corporations Act 2001 and:
a) comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory
professional reporting requirements; and
b) give a true and fair view of the financial position as at 30 June 2017 and of the performance for the year
ended on that date of the consolidated Group.
2.
In the directors’ opinion, there are reasonable grounds to believe that the Group will be able to pay its debts as
and when they become due and payable.
3. The remuneration disclosures included in the directors’ report (as part of the audited Remuneration Report), for
the year ended 30 June 2017, comply with section 300A of the Corporations Act 2001.
4. The Group has included in the notes to the financial statements and explicit an unreserved statement of
compliance with International Financial Reporting Standards.
5. The directors have been given the declarations by the chief executive officer and chief financial officer required
by section 295A.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the
directors by:
Glenn Whiddon
Chairman
Perth, Western Australia
26 September 2017
51
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR'S REPORT
To the members of Auroch Minerals Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Auroch Minerals Limited (the Company) and its subsidiaries
(the Group), which comprises the consolidated statement of financial position as at 30 June 2017, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement
of changes in equity and the consolidated statement of cash flows for the year then ended, and notes
to the financial report, including a summary of significant accounting policies and the directors’
declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2017 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 Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance
with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
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.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275,
an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and
form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation other than for
the acts or omissions of financial services licensees
Recoverability of trade and other receivables
Key audit matter
How the matter was addressed in our audit
As disclosed in Note 8 of the financial report, the Group
Our procedures included, but were not limited
holds trade and other receivables valued at $2,983,196
to:
(2016: $3,392,763).
•
Reviewing the terms and conditions of the
Refer to Note 1(m) and Note 2(a) of the financial report for
contractual arrangements of the
a description of the accounting policy and significant
receivables;
estimates and judgements applied to these assets.
•
Reviewing management’s assessment that
In accordance with Australian Accounting Standards, at the
there were no objective indicators of
end of each reporting period, management are required to
impairment for reasonableness;
assess whether there is any objective evidence that these
assets are impaired.
•
Holding discussions with management as to
the credit risk of the counterparty, and
Due to the subjectivity involved in determining whether
whether this information is consistent with
there is any objective evidence of impairment on these
management’s impairment assessment
assets, we have determined that the recoverability of trade
position;
and other receivables is a key audit matter.
•
Considering whether any other data exists
which would constitute indicators of
impairment; and
•
Assessing the adequacy of the related
disclosures in Note 1(m), Note 2(a) and
Note 8 of the financial report.
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2017, 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 the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group 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 Group 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 the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
http://www.auasb.gov.au/auditors_files/ar2.pdf
This description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 10 to 14 of the directors’ report for the
year ended 30 June 2017.
In our opinion, the Remuneration Report of Auroch Minerals Limited, for the year ended 30 June 2017,
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.
BDO Audit (WA) Pty Ltd
Dean Just
Director
Perth, 26 September 2017
AUROCH MINERALS LIMITED
ADDITIONAL INFORMATION
The following additional information is required by the ASX in respect of listed public companies.
Information as at 2 September 2019
(a) Distribution of Shareholders
Category (size of holding)
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 – 100,000
100,001 and above
Total
Number
Ordinary
14
48
80
384
108
634
(b) The number of shareholdings held in less than marketable parcels is 30.
(c) Voting Rights
The voting rights attached to each class of equity security are as follows:
Ordinary Shares
Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or
by proxy has one vote on a show of hands.
(d) 20 Largest Shareholders — Ordinary Shares as at 2 September 2017.
Rank
Holder Name
Designation
Securities
%
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
MED BRAVO SA
RARE EARTH MINERALS PLC
6466 INV PL
NORTON MATTHEW J + R F
MIMO STRATEGIES PL
CELTIC CAP PL
KOBIA HLDGS PL
GETMEOUTOFHERE PL
BLU BONE PL
HUGHES JAY + LINDA
RAINMAKER HLDGS WA PL
SMITH PETER S + D P
INKESE PL
BROWN BRICKS PL
INSWINGER HLDGS PL
J P MORGAN NOM AUST LTD
HSBC CUSTODY NOM AUST LTD
BAHEN MARK JOHN + M P
TURNILL JUSTIN PAUL
CROESUS MINING PL
12,707,432
6,500,000
5,048,333
3,180,000
2,961,318
2,000,000
2,000,000
1,624,976
1,600,000
1,350,000
1,340,000
1,308,333
1,300,000
1,277,227
950,000
879,850
870,220
750,000
684,833
679,117
49,011,639
36,805,912
85,817,551
14.81%
7.57%
5.88%
3.71%
3.45%
2.33%
2.33%
1.89%
1.86%
1.57%
1.56%
1.52%
1.51%
1.49%
1.11%
1.03%
1.01%
0.87%
0.80%
0.79%
57.09%
42.91%
100%
NORTON FAM SUPER A
MIMO A/C
CELTIC CAP A/C
SINKING SHIP S/F A
INKESE SUPER A/C
MACRI INV A/C
MONTARA S/F A/C
HM A/C
MJ BAHEN S/F A/C
SECOND S/F A/C
Top 20 Total
Total Remaining Balance
Grand Total
55
AUROCH MINERALS LIMITED
ADDITIONAL INFORMATION
(e) Substantial Shareholders (i.e. shareholders who hold 5% or more of the issued capital):
Name
Med Bravo SA
Rare Earth Minerals PLC
6466 INV PL
Number of Shares Held
12,707,432
6,500,000
5,048,333
Percentage
14.81%
7.57%
5.88%
(f) The name of the Company Secretary is Mr James Bahen.
(g) The address of the principal registered office is Unit 5, Ground Floor, 1 Centro Avenue, Subiaco WA 6008 Telephone
(08) 9486 4036.
(h) Registers of securities are held at Security Transfer Registrars Ltd, 770 Canning Highway, Applecross WA 6153.
(i) Stock Exchange Listing
Quotation has been granted for all the ordinary shares of the Company on the Australian Securities Exchange Ltd.
(j) Unquoted Securities
Number
300,000
1,000,000
24,144,650
4,821,349
300,000
Terms
Options exercisable at $0.10 on or before 17 March 2018
Options exercisable at $0.10 on or before 23 October 2018
Options exercisable at $0.20 on or before 23 October 2018
Options exercisable at $0.08 on or before 31 December 2018
Options exercisable at $0.20 on or before 24 March 2019
(k) Securities Subject to Escrow
Nil.
(l) Unquoted Equity Securities Holders with Greater than 20% of an Individual Class
Options exercisable at $0.10 on or before 17 March 2018
Percentage Held
100%
Name
S3 Consortium Pty Ltd
Options exercisable at $0.10 on or before 23 October 2018
Percentage Held
100%
Name
Titan Drilling International Limited
Options exercisable at $0.08 on or before 31 December 2018
Percentage Held
22%
Name
Celtic Capital Pty Ltd
22%
MIMO Strategies Pty Ltd
56
Number of Securities held
300,000
Number of Securities held
1,000,000
Number of Securities held
1,149,220
1,180,659
AUROCH MINERALS LIMITED
ADDITIONAL INFORMATION
Options exercisable at $0.20 on or before 24 March 2019
Percentage Held
100%
Name
Elysium Growth Nominees Pty Ltd
Number of Securities held
300,000
(m) Corporate Governance Statement
The Company’s Corporate Governance Statement is available on the Company’s website at:
http://www.aurochminerals.com/about-us/corporate-governance/
57