CORPORATE DIRECTORY
ABN 83 116 095 802
2014 ANNUAL REPORT
1
CORPORATE DIRECTORY
Contents
Letter to Shareholders……...2
Exploration Summary……….3
Mineral Resource
Estimates………………………...10
Annual Financial
Report……………………………..17
CORPORATE DIRECTORY
DIRECTORS
Michael Ashforth
Non-Executive Chairman
Michael Ivey
Managing Director & CEO
Campbell Ansell
Non-Executive Director
SECRETARY
Des Kelly
STOCK EXCHANGE
Castle Minerals Limited is listed
on the Australian Securities
Exchange.
PRINCIPAL OFFICE
Unit 6, 1 Clive Street
West Perth WA 6005
PO BOX 437, West Perth WA
6872
Tel: +618 9322 7018
Fax: +618 9315 2233
ABN 83 116 095 802
www.castleminerals.com
Email: info@castleminerals.com
REGISTERED OFFICE
Unit 6, 1 Clive Street
West Perth WA 6005
GHANA OFFICE
Paul Amoako-Atta
PO Box CT9 East Cantonments,
Near NAFTI
Accra, Ghana
Tel:
+233 21 771 889
SHARE REGISTRY
Security Transfer Registrars
PO Box 535
Applecross WA 6953
Tel:
Fax:
www:securitytransfer.com.au
(08) 9315 2333
(08) 9315 2233
AUDITORS
BDO Audit (WA) Pty Ltd,
38 Station Street
Subiaco, WA 6008
AUSTRALIA
ACCOUNTANTS
BDO Corporate Tax (WA) Pty Ltd
38 Station Street
Subiaco, WA 6008
BANKERS
National Australia Bank
Hay St
WEST PERTH WA
AUSTRALIAN SOLICITORS
Gilbert + Tobin
1202 Hay Street
WEST PERTH
WA 6005
GHANAIAN SOLICITORS
Reindorf Chambers
20 Jones Nelson Road
Adabraka, Accra
GHANA
ASX Code: CDT
2
LETTER TO SHAREHOLDERS
Dear Fellow Shareholders,
The 2013/14 year was another busy year for Castle with our sixth green fields gold discovery being made at
the Kpali prospect. Kpali is located in NW Ghana and following RC drilling we defined a maiden gold
resource and also intersected high grade primary gold mineralisation at the nearby Bundi prospect. RAB
drilling on our Wa Project, using our own drill rig, saw 1,262 RAB holes completed for 29,861m of low cost
drilling.
Kpali was discovered in 2013 during our regional exploration program and represents the sixth gold
resource defined by Castle since we commenced exploration in 2007. Gold mineralisation at Kpali starts a
few metres below the surface and it is expected that with further drilling the resource will be materially
increased as the deposit remains open and displays increasing grade and the strongest mineralisation at
depth.
An Inferred Mineral Resource of 107,200 ozs has been estimated for Kpali and as a result Castle’s total gold
inventory for its Ghana Projects increased by 29% to 362,000 ounces due to the inclusion of the maiden
resource estimate for Kpali and updates to the mineral resources for the Akoko and Kandia deposits.
Our exploration effort on the Wa Project also successfully identified the Kpali East gold anomaly as well as
intersecting a number of new graphitic schist horizons that are currently being assessed along with a
detailed review of the Company’s Kambale graphite deposit that hosts an Inferred Resource of 14.4mt @
7.2% C (graphitic carbon) for 1.03mt contained graphite.
Drilling at Kpali East discovered a new area of near surface gold mineralisation 500m east of Kpali. This
zone has excellent potential to host primary gold mineralization as the RAB intercepts overlie the east side
of the Kpali granite and are aligned with a demagnetised corridor; a setting that is considered extremely
favourable for gold mineralization.
As part of an option agreement signed with Merah Resources Limited (ASX:MEH) to acquire Castle’s 100%
interest in the Antubia Project, Castle was issued 2 Million Merah shares (ASX:MEH) during the year being
part consideration for the Antubia Project option to purchase. This shareholding represents a 3.6% holding
in MEH.
Gold equities for junior companies remain at historic lows and access to capital remains difficult however I
remain optimistic about Castle’s future and I look forward to keeping you informed of our progress. The
support we received from our shareholders this year is very much appreciated and our thanks also go to our
Ghana based exploration teams who have made an outstanding contribution during 2014.
Sincerely
Michael Ivey
Managing Director
3
EXPLORATION SUMMARY
2014 EXPLORATION SUMMARY
Castle continued to focus its efforts on its 100% owned gold projects in Ghana. Castle's concessions are
located within the historic Ashanti and Sefwi gold belts of South West Ghana and in the Wa–Lawra and
Bolgatanga greenstone belts in the north. Castle has five distinct projects known as Antubia, Bondaye,
Akoko, Wa and Opon Mansi. A sale/option agreement has been executed with Merah Resources for the
Antubia Project. Castle has defined gold resources within the Wa and Akoko Projects that remain the focus
of exploration activities.
OPERATING HIGHLIGHTS
Field activities included:
• 1,292 exploration drill holes completed for 33,404 metres, comprising
30 RC holes for 3,543 metres
1,262 RAB holes completed for 29,861m
• Maiden resource estimate for Kpali and updates to the mineral resources for the Akoko and Kandia
deposits were completed
Castle owns and operates its own drill rig that completed 29,861m during the year at a cost ~$5/m. This
work was undertaken by our Ghanaian exploration team who made an excellent contribution from our
exploration base in northwest Ghana.
EXPLORATION SUMMARY
Regional geology and prospects for the Wa Gold Project. Project area defined by blue outline
5
EXPLORATION SUMMARY
Exploration on the Company’s Wa Project in north west
Ghana focussed on the new gold discoveries at Bundi and
Kpali. At Kpali a maiden resource estimate was completed
following completion of RC drilling.
Kpali was discovered in 2013 and represents the sixth green
fields gold discovery made by Castle in Ghana.
Consistent gold mineralisation was intersected over 600m
of strike and remains completely open at depth. A strong
trend is evident on the sections with the grade and width of
the mineralisation increasing with depth. Significant gold
intercepts from 1m RC samples include:
28m @ 2.26 g/t gold from 81m (13SWRC049)
inc. 13m @ 3.87 g/t gold from 81m and
5m @ 8.41g/t gold from 89m
21m @ 1.55 g/t gold from 86m (13 SWRC053)
inc. 15m @ 2.08 g/t gold from 87m
inc. 10m @ 2.84 g/t gold from 92m
inc. 3m @ 6.52 g/t gold from 97m
14m @ 2.29 g/t gold from 98m (13 SWRC054)
inc. 5m @ 4.53 g/t gold from 99m
16m @ 3.23 g/t gold from 9m (13SWRC 057)
10m @ 2.01 g/t gold from 22m (13SWRC059) and
10m @ 1.45 g/t gold from 49m
10m @ 1.41 g/t gold from 50m (13SWRC059)
8m @ 1.44 g/t gold from 100m (13SWRC060)
The Kpali deposit remains open and displays increasing grade and the strongest mineralisation at depth.
An Inferred Mineral Resource of 107,200 ozs has been estimated for Kpali as per the summary in Table 1. As
a result Castle’s total gold inventory for its Ghana Projects has increased by 29% to 362,000 ounces due to the
inclusion of maiden resource estimate for Kpali and updates to the mineral resources for the Akoko and
Kandia deposits.
Table 1: Kpali Deposit June 2014 Mineral Resource Estimate (All Inferred, 0.5g/t Au Cut-off)
Tonnes
Au Cut
Au Uncut
Au Cut
Au Uncut
Type
t
Oxide
365,000
Fresh
2,549,000
Total
2,914,000
g/t
1.0
1.2
1.1
g/t
1.0
1.2
1.2
Ounces
Ounces
11,500
95,700
12,200
97,500
107,200
109,700
6
EXPLORATION SUMMARY
Kpali RC Drilling and Resource Wireframes (left) and Resource Block model (right)
Kpali drill hole plan and intercepts and drill cross section on 1029 100N
7
EXPLORATION SUMMARY
Bundi Prospect
Bundi is a high grade gold and zinc prospect defined over 1100m strike that provides significant potential for
a gold resource to be defined.
Final results were received for the fourteen RC holes completed in January 2014 that intersected a high grade
gold surface with assays up to 51 g/t gold. Drilling has now tested an 1100m long target with 16 of the 20
holes testing the Bundi structure reporting significant gold mineralisation.
The gold mineralisation is associated with zinc sulphides with highly anomalous zinc intercepts including
10m @ 1.16% Zn and 5m @ 1.54% Zn reported. The high grade gold surface is open along strike and at depth
and further RC and diamond drilling is proposed.
Gold mineralisation at Bundi is hosted within altered Birimian shales and sediments with associated sericite
alteration and 1-3% disseminated sulphides including pyrite, pyrrhotite, sphalerite and chalcopyrite. Bundi
is a grassroots gold discovery in a previously unexplored area.
Bundi long section showing RC gold intercepts
8
EXPLORATION SUMMARY
Bundi hole plan and Ghana Project locations with detail on Bundi and Kpali prospects
9
EXPLORATION SUMMARY
Kpali East RAB Anomaly
RAB drilling intersected a new area of near surface gold mineralisation 500m east of Kpali. This zone has
excellent potential to host primary gold mineralisation. The RAB intercepts overlie the east side of the Kpali
granite and are aligned with a demagnetised corridor; a setting that is considered extremely favourable for
gold mineralisation. Significant RAB intercepts from Kpali East include;
8m @ 0.16 g/t gold from 0m 13SWRB920 and
5m @ 0.59 g/t gold from 18m
23m @ 0.14 g/t gold from 0m 13SWRB921
24m @ 0.20 g/t gold from 9m 13SWRB922
3m @ 1.44 g/t gold from 0m 13SWRB926
8m @ 0.26 g/t gold from 0m 13SWRB972
32m @ 0.10 g/t gold from 0m 13SWRB974
18m @ 0.13 g/t gold from 13m 13SWRB976
5m @ 0.29 g/t gold from 13m 13SWRB985
20m @ 0.24g/t gold from 28m 14SWRB1903
Drill hole plan showing new RAB anomaly 400m east of Kpali
10
EXPLORATION SUMMARY
Drill plan for Bundi and Kpali prospects showing Kpali East RAB anomaly and +10km long De-Mag Zone
11
MINERAL RESOURCE SUMMARY
Resource Estimate Summaries
The total gold inventory for Castle’s Ghana Projects has increased by 29% to 362,000 ounces due to the
inclusion of the maiden resource estimates for Kpali and updates to the mineral resources for the Akoko and
Kandia deposits.
Resource summaries for all Mineral Resource Estimates are presented below in Table 2 (Some totals may not
add exactly due to rounding). Full resource parameters can be found in CDT ASX Release of 2/7/2014.
Table 2 : Mineral Resource Estimates for the Wa and Akoko Gold Projects
The Kandia gold resource was re-estimated for the 4000 Zone. Since the 2011 resource estimate, further RC
drilling was undertaken with the objective of defining depth extensions to the mineralisation. A total of 7 new
holes were drilled, and two existing RC holes were deepened.
Geology and assay results from those holes have now been incorporated into the deposit model. Several of the
holes did not intersect mineralisation where expected. This has resulted in reduced depth extent to the
mineralisation compared to the 2011 estimate, with a resulting downgrade of the tonnage and contained gold
of the deposit with a reduction of 14,800 ozs.
There has been no change to the 8000 Zone resource where there was no additional drilling. All other resource
parameters remain unchanged from the previous estimate. A summary of the revised Mineral Resource for
the deposit is shown in Table 3. The previous estimate is shown in Table 4.
12
Wa ProjectTonnesAuAuTonnesAuAuTonnesAuAutg/tOuncestg/tOuncestg/tOuncesJulie West 383,0004.252,10032,0004.04,100415,0004.256,2001.0Danyawu72,0005.512,80072,0005.512,8001.0Kandia 8000 Zone229,0001.813,400229,0001.813,4001.0Kandia 4000 Zone1,772,0001.057,700777,0000.921,5002,549,0001.079,2000.5Kpali2,914,0001.1107,2002,914,0001.1107,2000.5Wa Project Total2,227,0001.7122,6003,952,0001.2146,2006,178,0001.4268,900Akoko ProjectTonnesAuAuTonnesAuAuTonnesAuAutg/tOuncestg/tOuncestg/tOuncesAkoko North448,0001.622,500517,0002.845,900965,0002.268,4000.8Akoko South575,0001.324,400575,0001.324,4000.8Total448,0001.622,5001,092,0002.070,3001,540,0001.992,800Total Ghana ProjectsWa Project2,227,0001.7122,6003,952,0001.2146,2006,178,0001.4268,900Akoko Project448,0001.622,5001,092,0002.070,3001,540,0001.992,800Total2,675,0001.7145,1005,044,0001.3216,5007,718,0001.5361,700Lower CutoffIndicatedInferredTotalIndicatedInferredTotalLower CutoffIndicatedInferredTotal
MINERAL RESOURCE SUMMARY
Table 3: Kandia Deposit June 2014 ID2 Mineral Resource Estimate
Indicated
Inferred
Total
Type
Tonnes
Au
Au
Tonnes
Au
Au
Tonnes
Au
Au
t
g/t
Ounces
t
g/t
Ounces
t
g/t
Ounces
Oxide
126,000
1.0
4,000
50,000
1.3
2,100
176,000
1.1
6,000
Fresh
1,645,800
1.0
53,800
955,800
1.1
32,900
2,602,000
1.0
86,600
Total
1,772,000
1.0
57,700
1,006,000
1.1
34,900
2,778,000
1.0
92,700
Table 4: Kandia Deposit December 2011 ID2 Mineral Resource Estimate
Indicated
Inferred
Total
Type
Tonnes
Au
Au
Tonnes
Au
Au
Tonnes
Au
Au
t
g/t
Ounces
t
g/t
Ounces
t
g/t
Ounces
Oxide
131,300
1.0
4,100
51,000
1.3
2,100
183,000
1.1
6,200
Fresh
1,841,500
1.0
58,700
1,327,200
1.0
42,500
3,169,000
1.0
101,200
Total
1,973,000
1.0
62,900
1,379,000
1.0
44,600
3,351,000
1.0
107,500
Note: For both the 2014 and 2011 estimates, a 0.5g/t Au cut-off has been used for the 4000 Domain, and a 1.0g/t Au cut-off has been used for the 8000 Domain
The Akoko North Gold Resource was re-estimated to incorporate geology, assay data and bulk density data
from four diamond drill holes that have been drilled subsequent to the 2011 resource update.
Geology and assay results from those holes have largely confirmed the previous interpretation. Bulk density
data from the core has also been analysed and new bulk density parameters were derived for the Akoko North
estimate and have also been applied to the Akoko South deposit. The new density parameters are significantly
lower than the values assumed for the previous estimates (eg oxide density of 1.78t/m3 compared to 2.1t/m3
previously), resulting in a downgrade of the tonnage and contained gold of the deposits (reduction of 10,500
ozs).
A summary of the revised Mineral Resources for the deposits is shown in Table 5. The previous estimates are
shown in Table 6.
13
MINERAL RESOURCE SUMMARY
Table 5 : Akoko Project June 2014 Mineral Resource Estimate 0.8g/t Au Cut-off
Indicated
Inferred
Total
Deposit
Tonnes
Au
t
g/t
Au
Oz
Tonnes
Au
t
g/t
Au
Oz
Tonnes
Au
t
g/t
Au
Oz
Akoko North
448,000
1.6
22,500
517,000
2.8
45,900
965,000
2.2
68,400
Akoko South
575,000
1.3
24,400
575,000
1.3
24,400
Total
448,000
1.6
22,500
1,092,000
2.0
70,300
1,540,000
1.9
92,800
Table 6: Previous Estimates Akoko North (2011) and Akoko South (2009) 0.8g/t Au Cut-off
Indicated
Inferred
Total
Deposit
Tonnes
Gold
Tonnes
Gold
Tonnes
Gold
Gold
t
Akoko North
525,000
Akoko South
g/t
1.6
t
578,000
610,300
Total
525,000
1.6
1,188,300
g/t
2.7
1.3
2.0
t
g/t
Ounces
1,103,000
2.2
77,400
610,300
1.3
25,900
1,713,300
1.9
103,300
Kambale Graphite Deposit
In 2012 Castle announced a maiden resource estimate for its Kambale Graphite of 14.4mt @ 7.2% C
(graphitic carbon) for 1.03mt contained graphite (Inferred Resource).
Kambale Deposit July 2012 Inferred Mineral Resource Estimate (5% C cut-off grade)
Type
Oxide
Fresh
Total
Tonnes
Mt
3.4
11.0
14.5
C
%
7.1
7.2
7.2
Contained C
t
243,000
793,000
1,036,000
14
MINERAL RESOURCE SUMMARY
Drill hole plan of Kambale graphite deposit with significant graphite intercepts. Results in blue were used in the
2012 resource estimate whilst those in black are from new shallow drilling testing the southern strike extension.
15
MINERAL RESOURCE SUMMARY
COMPETENT PERSONS STATEMENT
Information in this announcement that relates to Exploration Results and Mineral Resources is based on
information compiled by Michael Ivey, Castle Minerals Limited Managing Director, who is a Member of The
Australasian Institute of Mining and Metallurgy. Michael Ivey is a permanent consultant to Castle Minerals
Limited and has sufficient experience that is relevant to the style of mineralisation and type of deposit under
consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the
2012 JORC Code. Michael Ivey consents to the inclusion in the report of the matters based on his information
in the form and context in which it appears.
16
Castle Minerals Limited
ABN 83 116 095 802
Annual Financial Report
for the year ended 30 June 2014
Castle Minerals Limited
Corporate Information
ABN 83 116 095 802
Directors
Michael Ashforth (Non-Executive Chairman)
Michael Ivey (Managing Director)
Campbell Ansell (Non-Executive Director)
Company Secretary
Desmond Kelly
Registered Office
Unit 6, 1 Clive Street
WEST PERTH WA 6005
Telephone: (08) 9322 7018
Facsimile: (08) 9315 2233
Postal Address
PO Box 437
WEST PERTH WA 6872
Solicitors
Gilbert + Tobin
1202 Hay Street
WEST PERTH WA 6005
Bankers
National Australia Bank Limited
1232 Hay Street
WEST PERTH WA 6005
Share Register
Security Transfer Registrars Pty Ltd
770 Canning Highway
APPLECROSS WA 6153
Telephone: (08) 9315 2333
Facsimile: (08) 9315 2233
Auditors
BDO Audit (WA) Pty Ltd
38 Station Street
SUBIACO WA 6008
Internet Address
www.castleminerals.com
Email Address
info@castleminerals.com
Stock Exchange Listing
Castle Minerals Limited shares are listed on the Australian Securities Exchange (ASX code CDT).
1
Castle Minerals Limited
Contents
Directors'
Report
Auditor’s Independence
Declaration
Corporate Governance
Statement
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
Independent Audit
Report
ASX Additional
Information
3
10
11
17
18
19
20
21
41
42
44
2
Directors’ Report
Castle Minerals Limited
Your directors submit their report on the consolidated entity (referred to hereafter as the Group) consisting of Castle Minerals Limited and
the entities it controlled at the end of, or during, the year ended 30 June 2014.
DIRECTORS
The names and details of the Group’s directors in office during the financial year and until the date of this report are as follows. Where
applicable, all current and former directorships held in listed public companies over the last three years have been detailed below. Directors
were in office for this entire period unless otherwise stated.
Names, qualifications, experience and special responsibilities
Michael Ashforth, JD, LLB (Non-Executive Chairman, chairman of remuneration committee, member of audit committee), Independent
Director.
Michael Ashforth is an Executive Director of Macquarie Capital. He was formerly a Managing Director of Gresham Advisory Partners.
Mr Ashforth has advised on a wide range of mergers and acquisitions transactions for Australian and international clients across a wide
range of industry sectors. He has extensive experience in transactions across the resources sector.
Mr Ashforth was appointed as a director of Castle Minerals on 5 September 2005. Mr Ashforth is a former director of Cradle Resources
Limited within the last 3 years.
Michael Ivey, B. App. Sc (Geol), M.Sc. (Min.Econ.) WASM, M.Aus.I.M.M., (Managing Director)
Michael Ivey has been involved in the mineral exploration industry in Western Australia for over 25 years and has held a number of senior
public company roles in the gold industry. He graduated from Curtin University with a Bachelor of Applied Science degree majoring in
geology and has a Master of Science (Mineral Economics) from the WA School of Mines.
Mr Ivey was appointed as a director on 5 September 2005
Mr Ivey is also Principal of MetalsEx Capital. Mr Ivey has not held any other public company directorships in the last 3 years.
Campbell Ansell, FCA, (Non-Executive Director, chairman of audit committee, member of remuneration committee), Independent
Director.
Campbell Ansell is a Chartered Accountant who is also a nonexecutive director of several other successful business operations and has had
a long term involvement with the resources sector and several government and semi government boards. Campbell has not held any other
public company directorships in the last 3 years.
Mr Ansell was appointed as a director on 5 September 2005.
COMPANY SECRETARY
Desmond Kelly
Mr Kelly has more than 30 years financial and corporate management experience focussed mainly in the resources sector and has acquired
extensive financial, audit and company secretarial skills during his career.
Interests in the shares and options of the Company and related bodies corporate
As at the date of this report, the interests of the directors in the shares and options of Castle Minerals Limited were:
Michael Ashforth
Michael Ivey
Campbell Ansell
Ordinary
Shares
5,980,000
7,378,498
1,759,250
Options over
Ordinary
Shares
-
-
-
Performance
Rights
-
2,000,000
-
PRINCIPAL ACTIVITIES
During the year the Group carried out exploration on its tenements and applied for or acquired additional tenements with the objective of
identifying gold and other economic mineral deposits.
There was no significant change in the nature of the Group’s activities during the year.
DIVIDENDS
No dividends were paid or declared during the financial year. No recommendation for payment of dividends has been made.
REVIEW OF OPERATIONS
An Exploration Review, including the business strategies and prospects of the Group, and the Directors Review are contained in the
previous sections of the annual report.
3
Directors' Report continued
Castle Minerals Limited
Finance Review
The Group began the financial year with a cash reserve of $1,636,882. Funds were used to actively advance the Group’s projects located
in Ghana, West Africa.
During the year total exploration expenditure incurred by the Group amounted to $1,362,300 (2013: $1,649,761). In line with the
Company’s accounting policies, all exploration expenditure is expensed as incurred. Net administration expenditure incurred amounted to
$138,022 (2013: $450,055). This has resulted in an operating loss after income tax for the year ended 30 June 2014 of $1,500,322 (2013:
$2,099,816).
At 30 June 2014 surplus funds available totalled $310,480.
Operating Results for the Year
Summarised operating results are as follows:
Consolidated entity revenues and loss before income tax expense
Shareholder Returns
Basic loss per share (cents)
2014
Revenues
$
Results
$
392,369
(1,636,763)
2014
(1.2)
2013
(1.8)
Risk Management
The board is responsible for ensuring that risks, and also opportunities, are identified on a timely basis and that activities are aligned with
the risks and opportunities identified by the board.
The Company believes that it is crucial for all board members to be a part of this process, and as such the board has not established a
separate risk management committee.
The board has a number of mechanisms in place to ensure that management's objectives and activities are aligned with the risks identified
by the board. These include the following:
Board approval of a strategic plan, which encompasses strategy statements designed to meet stakeholders needs and manage business
risk.
Implementation of board approved operating plans and budgets and board monitoring of progress against these budgets.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
A significant change in the state of affairs of the Group during the financial year was as follows:
An increase in contributed equity of $148,577 as a result of the issue of 4,245,067 ordinary shares as part consideration for drilling
services received.
SIGNIFICANT EVENTS AFTER THE REPORTING DATE
No matters or circumstances, besides those disclosed at note 20, have arisen since the end of the financial year which significantly affected
or may significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial
years.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
The Group expects to maintain the present status and level of operations and hence there are no likely developments in the entity's
operations.
ENVIRONMENTAL REGULATION AND PERFORMANCE
The Group is subject to significant environmental regulation in respect to its exploration activities.
The Group aims to ensure the appropriate standard of environmental care is achieved, and in doing so, that it is aware of and is in compliance
with all environmental legislation. The directors of the Group are not aware of any breach of environmental legislation for the year under
review.
The directors have considered the recently enacted National Greenhouse and Energy Reporting Act 2007 (the NGER Act) which introduces
a single national reporting framework for the reporting and dissemination of information about greenhouse gas emissions, greenhouse gas
projects, and energy use and production of corporations. At the current stage of development, the directors have determined that the NGER
Act will have no effect on the Group for the current, nor subsequent, financial year. The directors will reassess this position as and when
the need arises.
4
Directors' Report continued
Castle Minerals Limited
REMUNERATION REPORT (AUDITED)
The information provided in this audited remuneration report has been audited as required by section 308(3C) of the Corporations Act
2001.
Principles used to determine the nature and amount of remuneration
Remuneration Policy
The Remuneration Committee is comprised of the two non-executive directors. The remuneration policy of Castle Minerals Limited has
been designed to align director and executive 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. All short
term incentives are decided at Board level. The board of Castle Minerals Limited believes the remuneration policy to be appropriate and
effective in its ability to attract and retain the best executives and directors to run and manage the Group.
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 by the
board. All executives receive a base salary (which is based on factors such as length of service and experience) and superannuation. The
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.
The board may exercise discretion in relation to approving incentives, bonuses and options. The policy is designed to attract and retain the
highest calibre of executives and reward them for performance that results in long-term growth in shareholder wealth.
Executives are also entitled to participate in the employee share and option arrangements.
The executive directors and executives receive a superannuation guarantee contribution required by the government, which was 9.25% for
the 2014 financial year (9.5% effective 1 July 2014), and do not receive any other retirement benefits. Some individuals, however, may
choose to sacrifice part of their salary to increase payments towards superannuation.
All remuneration paid to directors and executives is valued at the cost to the Group and expensed. Shares given to directors and executives
are valued as the difference between the market price of those shares and the amount paid by the director or executive. Options are valued
using either the Black-Scholes or Binomial methodologies.
The board policy is to remunerate non-executive directors at market rates for comparable companies for time, commitment and
responsibilities. The board determines payments to the non-executive directors and reviews their remuneration annually, based on market
practice, duties and accountability. Independent external advice is sought when required. The maximum aggregate amount of fees that can
be paid to non-executive directors is subject to approval by shareholders at the Annual General Meeting (currently $200,000). 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 Company and are able to participate in the employee option plan.
Performance based remuneration
The Group currently has performance based remuneration components built into director and executive remuneration packages.
Performance Rights
Michael Ivey was issued 2,000,000 performance rights for nil consideration on the 7 December 2011 following shareholder approval
granted at the Annual General Meeting held on 22 November 2011. The Performance Rights will vest only if a total Gold Resource
(Measured, Indicated or Inferred) equal to or exceeding 1,000,000oz of gold, or gold equivalent for other precious or base metals, in
accordance with the JORC Code, is obtained, provided that the total Resource must contain at least 80% of the ounces within the Measured
and Indicated categories as defined by the JORC Code.
The rights expire on the 22 November 2016.
As part of Mr Haydn Hadlow’s employment agreement he will be entitled to be issued with 1,000,000 fully paid ordinary shares upon
achieving performance hurdles, (subject to any required shareholder approvals). The Hurdle will be achieved only if a total Gold Resource
for the Company (Measured, Indicated or Inferred) is equal to or exceeds 1,000,000oz of gold, or gold equivalent for other precious or base
metals, in accordance with the JORC Code is obtained. These rights were cancelled when Mr Hadlow resigned in February 2014.
Company performance, shareholder wealth and directors’ and executives’ remuneration
No relationship exists between shareholder wealth, director and executive remuneration and Company performance due to the Group still
being in the exploration phase.
The table below shows the gross revenue, losses and earnings per share for the last five years for the listed entity.
2011
$
2012
$
2014
$
2010
$
2013
$
Revenue
Net loss
Loss per share (cents)
Share price at year end (cents)
No dividends have been paid.
392,369
(1,500,322)
(1.2)
1.0
145,539
(2,099,816)
(1.8)
2.9
329,520
(4,538,103)
(4.0)
26.0
418,744
(5,053,439)
(5.2)
35.0
141,712
(2,977,591)
(4.0)
40.0
5
Directors' Report continued
Castle Minerals Limited
Use of remuneration consultants
The Group did not employ the services of any remuneration consultants during the financial year ended 30 June 2014.
Voting and comments made at the Company’s 2013 Annual General Meeting
The Company received approximately 84.5% of “yes” votes on its remuneration report for the 2013 financial year. The Company did not
receive any specific feedback at the AGM or throughout the year on its remuneration practices.
Details of remuneration
Details of the remuneration of the directors and the key management personnel of the Group are set out in the following table.
The key management personnel of the Group include the directors and the following executive officer who has authority and responsibility
for planning, directing and controlling the activities of the Group:
Haydn Hadlow – Exploration Manager (resigned February 2014)
Given the size and nature of operations of the Group, there are no other employees who are required to have their remuneration disclosed
in accordance with the Corporations Act 2001.
Key management personnel of the Group
Short-Term
Post Employment
Share-Based
Payments
Total
Salary
& Fees
$
Non-Cash
benefits
$
Superannuation
$
Retirement
benefits
$
Performance
rights
$
$
Percentage
Relevant
to Share-
Based
Payments
%
Percentage
Perfor-
mance
Related
%
Directors
Michael Ashforth
2014
2013
Michael Ivey(1)
2014
2013
Campbell Ansell
2014
2013
50,000
50,000
183,333
300,000
30,000
30,000
Other key management personnel
Haydn Hadlow (resigned February 2014)
86,492
195,833
2014
2013
-
4,964
-
4,964
-
4,964
4,625
4,500
-
-
2,775
2,700
-
-
8,001
17,625
Total key management personnel compensation
2014
2013
349,825
575,833
-
14,892
15,401
24,825
-
-
-
-
-
-
-
-
-
-
-
-
54,625
59,464
-
-
-
-
20,498
21,346
203,831
326,310
10.1
6.5
10.1
6.5
-
-
32,775
37,664
-
-
-
-
(2)(92,400)
30,690
2,093
244,148
(2)
12.6
(2)
12.6
(71,902)
52,036
293,324
667,586
(1) In addition to the above remuneration, the Group leased office accommodation from Henmik Pty Ltd (“Henmik”), a company associated
with Mr Ivey. The lease terms are set at normal commercial rates, with amounts paid during the year totalling $74,544 (2013: $73,065).
(2) Mr Hadlow’s performance rights were cancelled by right of forfeiture when he left the Company’s employment in February 2014.
Therefore, as no rights have ultimately vested due to failure to satisfy the vesting conditions, the previously expensed amount has been
reversed during the current period.
Service agreements
The details of service agreements of the key management personnel of Castle Minerals Limited and the Group are as follows:
Michael Ivey, Managing Director:
(cid:0) Term of agreement – 4 years commencing 1 July 2010.
(cid:0) Annual consultancy fees, from the beginning of the financial year of $150,000 (plus GST), increased to $250,000 effective 1 March
2014, are paid to M Ivey Pty Ltd, a company controlled by Mr Ivey.
(cid:0) The agreement may be terminated by the Company, without reason, by giving the consultant 12 months written notice. The consultant
may terminate the agreement, without reason, by giving the Company 3 months’ written notice. There are no benefits payable on
termination other than entitlements accrued to the date of termination.
6
Directors' Report continued
Castle Minerals Limited
Haydn Hadlow, Exploration Manager:
(cid:0) Term of agreement – Commenced 1 September 2011 until resignation in February 2014.
(cid:0) Annual base salary, inclusive of 9% superannuation, of $218,000.
(cid:0) Under Mr Hadlow’s employment agreement he will be entitled to be issued with 1,000,000 fully paid ordinary shares upon achieving
performance hurdles, (subject to any required shareholder approvals). The Hurdle will be achieved only if a total Gold Resource for
the Company (Measured, Indicated or Inferred) is equal to or exceeds 1,000,000oz of gold, or gold equivalent for other precious or
base metals, in accordance with the JORC Code is obtained. These rights were cancelled when Mr Hadlow resigned.
None of the other directors or key management personnel have service agreements in place.
Share-based compensation
Options
Options are issued to directors and executives as part of their remuneration. The options are not issued based on performance criteria, but
are issued to the majority of directors and executives of Castle Minerals Limited to increase goal congruence between executives, directors
and shareholders. The Company does not have a formal policy in relation to the key management personnel limiting their exposure to risk
in relation to the securities, but the Board actively discourages key personnel management from obtaining mortgages in securities held in
the Company. There were no options granted to or vesting with key management personnel during the year.
Ordinary Shares
No ordinary shares in the Company have been provided as a result of the exercise of remuneration options to each director of Castle
Minerals Limited and other key management personnel of the Group during the year.
Performance Rights
Performance rights are issued to directors and executives as part of their remuneration, following the approval by shareholders of the
Company’s Performance Rights Plan at the 2011 Annual General Meeting. The Company does not have a formal policy in relation to the
key management personnel limiting their exposure to risk in relation to the securities, but the Board actively discourages key personnel
from obtaining mortgages in securities held in the Company.
The terms and conditions of each grant of performance rights affecting remuneration in the current or a future reporting period are as
follows:
Grant Date
Granted
Number
Vested
Number
Forfeited
%
Date Vesting
and
Exercisable Expiry Date
Value per
right at
grant date
(cents)(1)
% of
Remuneration
Directors
Michael Ivey
Other Key Management Personnel
Haydn Hadlow (resigned
February 2014)
22/11/2011 2,000,000
05/07/2011 1,000,000
Nil
-
(2)
22/11/2016
27.0
10.1
Nil
100%
(3)
N/A
33.0
(3)
(1) The value at grant date in accordance with AASB 2: Share Based Payments of performance rights granted during the year as part of
remuneration. The value is the closing share price on grant date.
(2) The performance condition for these rights is:
“The Company achieving a total Gold Resource (Measured, Indicated or Inferred) equal to or exceeding 1,000,000oz of gold, or
gold equivalent for other precious or base metals, in accordance with the JORC Code, provided that the total Resource must contain
atleast 80% of the ounces within the Measured and Indicated categories as defined by the JORC code.”
At the reporting date, the Board has determined that the probability of this performance condition being met is 17%.
(3) The performance condition for these rights was:
“The Company achieving a total Gold Resource (Measured, Indicated or Inferred) equal to or exceeding 1,000,000oz of gold, or
gold equivalent for other precious or base metals, in accordance with the JORC Code.”
Mr Hadlow’s performance rights were cancelled by right of forfeiture when he left the Company’s employment in February 2014.
Therefore, as no rights have ultimately vested due to failure to satisfy the vesting conditions, the previously expensed amount has been
reversed during the current period.
Equity instruments held by key management personnel
Share holdings
The numbers of shares in the Company held during the financial year by each director of Castle Minerals Limited and other key management
personnel of the Group, including their personally related parties, and any nominally held, are set out below. There were no shares granted
during the reporting period as compensation.
7
Castle Minerals Limited
Directors' Report continued
2014
Directors of Castle Minerals Limited
Ordinary shares
Michael Ashforth
Michael Ivey
Campbell Ansell
Other key management personnel of the Group
Ordinary shares
Haydn Hadlow (resigned February 2014)
(1) At year end there are no nominally held shares.
Received
during the
year on the
exercise of
options
Balance at
start of the
year
Other changes
during the
year
Balance at end
of the year(1)
5,980,000
7,378,498
1,759,250
-
-
-
-
-
-
-
-
-
5,980,000
7,378,498
1,759,250
-
Performance right holdings
Michael Ivey was issued 2,000,000 performance rights for nil consideration on the 7 December 2011 following shareholder approval
granted at the Annual General Meeting held on 22 November 2011. The Performance Rights will vest only if a total Gold Resource
(Measured, Indicated or Inferred) equal to or exceeding 1,000,000oz of gold, or gold equivalent for other precious or base metals, in
accordance with the JORC Code, is obtained, provided that the total Resource must contain at least 80% of the ounces within the Measured
and Indicated categories as defined by the JORC Code.
The rights expire on the 22 November 2016.
As part of Mr Haydn Hadlow’s employment agreement he will be entitled to be issued with 1,000,000 fully paid ordinary shares upon
achieving performance hurdles, (subject to any required shareholder approvals). The hurdle will be achieved only if a total Gold Resource
for the Company (Measured, Indicated or Inferred) is equal to or exceeds 1,000,000oz of gold, or gold equivalent for other precious or base
metals, in accordance with the JORC Code is obtained. These rights were cancelled when Mr Hadlow resigned in February 2014.
No other member of the key management personnel holds options or performance rights in the Company.
Loans to key management personnel
There were no loans to key management personnel during the year.
Other transactions with key management personnel
During the year, the Group leased office accommodation from Henmik Pty Ltd (“Henmik”), a company associated with Mr Ivey. The lease
terms are set at normal commercial rates, with amounts paid during the year totalling $74,544. There are no amounts outstanding at the
reporting date. Refer to note 17 for details of the lease commitments.
End of audited Remuneration Report
DIRECTORS' MEETINGS
During the year the Company held five meetings of directors. The attendance of directors at meetings of the board were:
Committee Meetings
Michael Ashforth
Michael Ivey
Campbell Ansell
Directors Meetings
Audit
Remuneration
A
5
5
5
B
5
5
5
A
2
*
2
B
2
*
2
A
1
*
1
B
1
*
1
Notes
A - Number of meetings attended.
B - Number of meetings held during the time the director held office during the year.
* - Not a member of the relevant Committee.
8
Directors' Report continued
Castle Minerals Limited
SHARES UNDER OPTION
Unissued ordinary shares of Castle Minerals Limited under option at the date of this report are as follows:
Expiry date
1 September 2016
Exercise price (cents)
40
Date options issued
30 May 2011
Total number of options outstanding at the date of this report
Number of options
1,050,000
1,050,000
No option holder has any right under the options to participate in any other share issue of the Company or any other entity.
INSURANCE OF DIRECTORS AND OFFICERS
During the financial year, Castle Minerals Limited paid a premium to insure the directors and secretary of the Company. The total amount
of insurance contract premiums paid is confidential under the terms of the insurance policy. The amount has been included in the
compensation amounts disclosed for key management personnel elsewhere in this report and in the notes to the financial statements.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought against the
officers in their capacity as officers of the Company, and any other payments arising from liabilities incurred by the officers in connection
with such proceedings. This does not include such liabilities that arise from conduct involving a wilful breach of duty by the officers or the
improper use by the officers of their position or of information to gain advantage for themselves or someone else or to cause detriment to
the company. It is not possible to apportion the premium between amounts relating to the insurance against legal costs and those relating
to other liabilities.
NON-AUDIT SERVICES
The following non-audit services were provided by the entity's auditor, BDO Audit (WA) Pty Ltd or associated entities. The directors are
satisfied that the provision of 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, as set out below, 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 audit committee 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.
BDO Audit (WA) Pty Ltd or associated entities received or are due to receive the following amounts for the provision of non-audit services:
Tax compliance services
Total remuneration for non-audit services
2014
$
6,630
6,630
2013
$
8,640
8,640
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 10.
Signed in accordance with a resolution of the directors.
Michael Ivey
Managing Director
Perth, 25 September 2014
9
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 GLYN O'BRIEN TO THE DIRECTORS OF CASTLE MINERALS
LIMITED
As lead auditor of Castle Minerals Limited for the year ended 30 June 2014, 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 Castle Minerals Limited and the entities it controlled during the period.
Glyn O'Brien
Director
BDO Audit (WA) Pty Ltd
Perth, 25 September 2014
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) in each State or Territory other than Tasmania.
Corporate Governance Statement
Castle Minerals Limited
The Board of Directors
The Company's constitution provides that the number of directors shall not be less than three and not more than nine. There is no
requirement for any share holding qualification.
As and if the Company's activities increase in size, nature and scope the size of the board will be reviewed periodically, and as circumstances
demand. The optimum number of directors required to supervise adequately the Company's constitution will be determined within the
limitations imposed by the constitution.
The membership of the board, its activities and composition, is subject to periodic review. The criteria for determining the identification
and appointment of a suitable candidate for the board shall include quality of the individual, background of experience and achievement,
compatibility with other board members, credibility within the Company's scope of activities, intellectual ability to contribute to board's
duties and physical ability to undertake board's duties and responsibilities.
Directors are initially appointed by the full board subject to election by shareholders at the next general meeting. Under the Company's
constitution the tenure of a director (other than managing director, and only one managing director where the position is jointly held) is
subject to reappointment by shareholders not later than the third anniversary following his or her last appointment. Subject to the
requirements of the Corporations Act 2001, the board does not subscribe to the principle of retirement age and there is no maximum period
of service as a director. A managing director may be appointed for any period and on any terms the directors think fit and, subject to the
terms of any agreement entered into, may revoke any appointment.
The board considers that the Company is not currently of a size, nor are its affairs of such complexity to justify the formation of separate
or special committees (other than audit, remuneration and nominations committees) at this time. The board as a whole is able to address
the governance aspects of the full scope of the Company's activities and to ensure that it adheres to appropriate ethical standards.
Role of the Board
The board's primary role is the protection and enhancement of long-term shareholder value.
To fulfil this role, the board is responsible for oversight of management and the overall corporate governance of the Company including
its strategic direction, establishing goals for management and monitoring the achievement of these goals.
Appointments to Other Boards
Directors are required to take into consideration any potential conflicts of interest when accepting appointments to other boards.
Independent Professional Advice
The board has determined that individual directors have the right in connection with their duties and responsibilities as directors, to seek
independent professional advice at the Company's expense. With the exception of expenses for legal advice in relation to director's rights
and duties, the engagement of an outside adviser is subject to prior approval of the Chairman and this will not be withheld unreasonably.
Continuous Review of Corporate Governance
Directors consider, on an ongoing basis, how management information is presented to them and whether such information is sufficient to
enable them to discharge their duties as directors of the Company. Such information must be sufficient to enable the directors to determine
appropriate operating and financial strategies from time to time in light of changing circumstances and economic conditions. The directors
recognise that mineral exploration is an inherently risky business and that operational strategies adopted should, notwithstanding, be
directed towards improving or maintaining the net worth of the Company.
ASX Principles of Good Corporate Governance
The board has reviewed its current practices in light of the ASX Principles of Good Corporate Governance and Best Practice Guidelines
with a view to making amendments where applicable after considering the Company's size and the resources it has available.
As the Company's activities develop in size, nature and scope, the size of the board and the implementation of any additional formal
corporate governance committees will be given further consideration.
The following table sets out the Company's present position with regard to adoption of these Principles.
11
ASX Principle
Status
Reference/comment
Principle 1:
Lay solid foundations for management and oversight
1.1
A listed entity should disclose:
(a) The respective roles and responsibilities of its
board and management; and
(b) Those matters expressly reserved to the board and
those delegated to management
A
A
The Roles and responsibilities of the Board and management are set
out in the Annual Report
Matters reserved for the Board can be viewed on the Company website
1.2
A listed entity should:
(a) Undertake appropriate checks before appointing a
person, or putting forward to security holders a
candidate for election, as a director; and
(b) Provide security holders with all material
information in its possession relevant to a decision on
whether or not to elect or re-elect a director
1.3
1.4
A listed entity should have a written agreement with
each director and senior executive setting out the terms
of their appointment
The company secretary of a listed entity should be
accountable directly to the board, through the chair, on
all matters to do with the proper functioning of the
board.
1.5
A listed entity should:
(a) Have a diversity policy which includes
requirements for the board or a relevant committee of
the board to set measurable objectives for achieving
gender diversity and to assess annually both the
objectives and the entity’s progress in achieving them;
(b) Disclose that policy or a summary of it; and
(c) Disclose at the end of each reporting period the
measurable objectives for achieving gender diversity set
by the board or a relevant committee of the board in
accordance with the entity’s diversity policy and its
progress towards achieving then and either:
(i) the respective proportions of men and
women on the board, in senior executive positions and
across the whole organisation (including how the entity
has defined “senior executive” for these purposes); or
(ii) if the entity is a “relevant employer”
under the Workplace Gender Equality Act, the entity’s
most recent “Gender Equality Indicators”, as defined in
and published under that Act.
A
The Chairman undertakes appropriate reference checks
The Company’s Notice of Meeting for election of Directors includes
material information
Employment agreements are in place for all senior executive
appointments and for the Board.
The Company is committed to providing a workplace that promotes
includes, gender, age, ethnicity, cultural
diversity. Diversity
background or disability. Due to the small size and nature of the
company it does not propose to implement a formal code or policy
with measureable objectives.
A
A
A
N/A
N/A
N/A
A
The Company has employed three female employees part time, nil in
executive or Board positions. Proportion of females is 25% of
employees across the whole organisation
1.6
A listed entity should:
(a) Have and disclose a process for periodically
evaluating the performance of the board, its committees
and individual directors; and
(b) Disclose, in relation to each reporting period
whether a performance evaluation was undertaken in
the reporting period in accordance with that process.
A
A
Evaluations were conducted in the current year using a performance
survey to:
• review the respective roles of the Board ;
• review the mix of experience and skills required by the Board;
• assess the performance of the Board as a whole over the previous
12 months
• assess the effectiveness of Board processes; and
• examine ways of assisting the Board in performing its duties
more effectively and efficiently.
The Managing Director’s performance evaluation is also undertaken
annually by the Board. The performance of non-executive Directors
is reviewed by the Board with the exclusion of the Director concerned.
1.7
A listed entity should:
12
(a) Have and disclose a process for periodically
evaluating the performance of its senior executives; and
A
Evaluations were conducted in the current year using a performance
survey.
(b) Disclose, in relation to each reporting period,
whether a performance evaluation was undertaken in
the reporting period in accordance with that process
Principle 2:
Structure the board to add value
2.1
The board of a listed entity should:
(a) Have a nomination committee which:
N/A
(i) Has at least three members, a majority of
whom are independent directors; and
(ii) Is chaired by an independent director, and
discloses:
(iii) The charter of the committee;
(iv) The members of the committee; and
(v) As at the end of each reporting period, the
number of times the committee met throughout the
period and the individual attendances of the members at
those meetings; OR
(b) If it does not have a nomination committee,
disclose that fact and the processes it employs to
address board succession issues and to ensure that the
board has the appropriate balance of skills, knowledge,
experience, independence and diversity to enable it to
discharge its duties and responsibilities effectively
2.2
A listed entity should have and disclose a board skills
matrix setting out the mix of skills and diversity that the
board currently has or is looking to achieve in its
membership.
2.3
A listed entity should disclose:
(a) The names of the directors considered by the
board to be independent directors;
(b) If a director has an interest, position, associated or
relationship of the type described in Box 2.3 but the
board is of the opinion that it does not comprise the
independence of the director, the nature of the interest,
position, association or relationship in question and an
explanation of why the board is of that opinion; and
(c) The length of service of each director.
A majority of the board of a listed entity should be
independent directors.
The chair of the board of a listed entity should be an
independent director and, in particular, should not be
the same person as the CEO of the entity
A listed entity should have a program for inducting new
directors and provide appropriate professional
development opportunities for directors to develop and
maintain the skills and knowledge needed to perform
their role as directors effectively.
2.4
2.5
2.6
Principle 3:
Act Ethically and Responsibly
3.1
A listed entity should:
(a) Have a code of conduct for its directors, senior
executives and employees; and
(b) Disclose that code or a summary of it
Principle 4:
Safeguard Integrity in Corporate Reporting
4.1
The board of a listed entity should:
13
A
The full Board carries out the duties that would normally fall to the
nomination committee. This includes the selection of new directors
and re-election of incumbent directors. The Boards policy on
appointment of Directors is based on the qualifications, experience and
industry relevance.
A
The skills and experience of Directors are set out in the Company’s
Annual Report and on its website.
A
Messrs Ashforth and Ansell are considered independent.
Is disclosed in the Annual Report’s Directors Report
Two of the three directors are considered independent
All board members maintain their own professional memberships and
continuing professional development
those
memberships. This is encouraged by the Board.
requirements of
Disclosed
www.castleminerals.com/corporate/company
procedures/code of conduct.
on
the
policies
website
and
A
A
A
A
A
A
A
(a) Have an audit committee which:
(i) Has at least three members, all whom are
non-executive directors and a majority of whom are
independent directors; and
(ii) Is chaired by an independent director, who
is not the chair of the board; and disclose:
(iii) The charter of the committee;
(iv) The relevant qualifications and experience
of the members of the committee; and
(v) In relation to each reporting period, the
number of times the committee met throughout the
period and the individual attendances of the members at
those meetings; OR
(b) If it does not have an audit committee, disclose
that fact and the processes it employs that
independently verify and safeguard the integrity of its
corporate reporting, including the processes for the
appointment and removal of the external auditor and the
rotation of the audit engagement partner.
The board of a listed entity should, before it approves
the entity’s financial statements for a financial period,
receive from its CEO and CFO a declaration that, in
their opinion, the financial records of the entity have
been properly maintained and that the financial
statements comply with the appropriate accounting
standards and give a true and fair view of the financial
position and performance of the entity and that the
opinion has been formed on the basis of a sound system
of risk management and internal control which is
operating effectively.
A listed entity that has an AGM should ensure that its
external auditor attends its AGM and is available to
answer questions from security holders relevant to the
audit
4.2
4.3
Principle 5: Make Timely and Balanced Disclosure
5.1
A listed entity should:
(a) Have a written policy for complying with its
continuous disclosure obligations under the Listing
Rules; and
(b) Disclose that policy or a summary of it.
Principle 6:
Respect the Rights of Security Holders
A
The Company has established an audit committee which comprises
only non-executive directors.
N/A
The company only has two non executive directors
A
A
A
A
A
A
A
A
Is disclosed at www.castleminerals.com/ corporate/company policies
and procedures/audit committee charter.
Details are disclosed in the Company Annual Report’s Directors’
Report
www.castleminerals.com/corporate/
procedures/continuous disclosure policy
company
policies
and
6.1
6.2
6.3
6.4
A listed entity should provide information about itself
and its governance to investors via its website.
A
www.castleminerals.com
A listed entity should design and implement an investor
relations program to facilitate effective two-way
communication with investors
A listed entity should disclose the policies and
processes it has in place to facilitate and encourage
participation at meetings of security holders.
A listed entity should give security holders the option to
receive communications to, the entity and its security
registry electronically.
A
A
A
All shareholders are kept informed of major developments affecting
the Company. This disclosure is through regular shareholder
communications including the Annual Report, Quarterly Reports, the
Company website and the distributions of specific releases covering
major transactions or events
All shareholders receive Notices of Meetings and are encouraged to
participate at all meetings
www.castleminerals.com/corporate/
procedures/continuous disclosure policy
company
policies
and
Principle 7:
Recognise and Manage Risk
7.1
The board of a listed entity should:
14
(a) Have a committee or committees to oversee risk,
each of which:
(i) Has at least three members, a majority of
whom are independent directors; and
N/A
(ii) Is chaired by an independent director, and
disclose;
(iii) The charter of the committee;
(iv) The members of the committee and
(v) As at the end of each of the reporting
period, the number of times the committee met
throughout the period and the individual attendances of
the members at those meetings; OR
(b) if it does not have a risk committee or committees
that satisfy (a) above, disclose that fact and the process
it employs for overseeing the entity’s risk management
framework
7.2
The board or a committee of the board should:
(a) review the entity’s risk management framework
at least annually to satisfy itself that it continues to be
sound; and
(b) disclose, in relation to each reporting period,
whether such a review has taken place
A
A
A
the Company does have formalised policies on risk
While
management the Board recognises its responsibility for identifying
areas of significant business risk and for ensuring that arrangements
are in place for adequately managing these risks. This issue is
regularly reviewed at Board meetings and risk management culture is
encouraged amongst employees and contractors. The risk management
at
policy
on
www.castleminerals.com/corporate/
and
procedures/risk management policy
the
company
site
policies
outlined
web
is
The Board is responsible for ensuring the Company establishes and
maintains policies for risk oversight and management. It is the Board’s
responsibility to ensure that an effective internal control framework
exists within the entity. This includes internal controls to deal with
both the effectiveness and efficiency of significant business processes.
This also includes the safeguarding of assets, the maintenance of
proper accounting records, and the reliability of financial information
as well as non-financial considerations.
The Audit Committee is responsible for monitoring the development
and annual review of the Company’s risk profile and system of risk
management. The Audit Committee also provides the board with
additional assurance regarding the reliability of the financial
information for the inclusion in the financial reports. This review has
taken place.
7.3
A listed entity should disclose:
(a) if it has an internal audit function, how the
function is structured and what role it performs; OR
(b) if it does not have an internal audit function, that
fact and the processes it employs for evaluating and
continually improving the effectiveness of its risk
management and internal control processes.
N/A
A
The Board requires management to establish appropriate systems and
procedures to manage the Company’s material business risks and to
report on the effective management of those risks. An annual review
has been completed
7.4
A listed entity should disclose whether it has any
material exposure to economic, environmental and
social sustainability risks and, if it does, how it manages
or intends to manage those risks.
Principle 8:
Remunerate Fairly and Responsibly
8.1
The board of a listed entity should:
(a) have a remuneration committee which:
(i) has at least three members, a majority of
whom are independent directors; and
(ii) is chaired by an independent directors,
and disclose:
(iii) the charter of the committee;
(iv) the members of the committee; and
(v) as at the end of each reporting period, the
number of times the committee met throughout the
period and the individual attendances of the members at
those meetings; OR
15
A
The Company has exposure to capital markets risks which are
managed by promotional activities to those markets
A(in
part)
N/A
A
Due to the size of the Board the Remuneration committee consists of
only two non executive directors.
N/A
There is no formal charter.
A
A
Messrs Ansell and Ashforth are members
This is disclosed in the Annual Report’s Directors’ Report
8.2
8.3
(b) if it does not have a remuneration committee,
disclose that fact and the processes it employs for
setting the level and composition of remuneration for
directors and senior executives and ensuring that such
remuneration is appropriate and not excessive.
A listed entity should separately disclose its policies
and practices regarding the remuneration of non-
executive directors and the remuneration of executive
directors and other senior executives.
A listed entity which has an equity–based remuneration
scheme should:
(a) have a policy on whether participants are
permitted to enter into transactions (whether through
the use of derivatives or otherwise) which limit the
economic risk of participating in the scheme; and
disclose that policy or a summary of it.
N/A
N/A
The Company does not have separate policies and practices regarding
remuneration but endeavours to remunerate fairly given the economic
circumstances of the company and the market based realities for
employment opportunities
There is no formal charter or policy on prohibiting the entering into
transactions in associated products which limit the economic risk of
participating in unvested entitlements under any equity based
remuneration schemes
A = Adopted; N/A = Not adopted
16
Castle Minerals Limited
Consolidated Statement of Profit or Loss and Other Comprehensive
Income
YEAR ENDED 30 JUNE 2014
Notes
Consolidated
REVENUE
Other income
EXPENDITURE
Depreciation expense
Salaries and employee benefits expense
Tenement acquisition and exploration expenses
Impairment expense
Corporate expenses
Administration expenses
Fair value loss on investments held for trading
Share based payment income/(expense)
LOSS BEFORE INCOME TAX
INCOME TAX BENEFIT
2014
$
33,326
359,043
(156,188)
(140,199)
(1,362,300)
-
(68,269)
(191,891)
(176,000)
65,715
2013
$
93,739
51,800
(144,099)
(140,148)
(1,649,761)
(31,729)
(77,621)
(277,610)
-
(98,973)
(1,636,763)
(2,274,402)
136,441
174,586
4(a)
4(b)
5
9
23
6
LOSS FOR THE YEAR ATTRIBUTABLE TO MEMBERS OF CASTLE MINERALS
LIMITED
(1,500,322)
(2,099,816)
OTHER COMPREHENSIVE INCOME
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Other comprehensive income for the year, net of tax
5,229
5,229
32,608
32,608
TOTAL COMPREHENSIVE LOSS FOR THE YEAR ATTRIBUTABLE TO MEMBERS
OF CASTLE MINERALS LIMITED
(1,495,093)
(2,067,208)
Basic and diluted loss per share for loss attributable to the members of Castle
Minerals Limited (cents per share)
22
(1.2)
(1.8)
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the Notes to the Consolidated
Financial Statements.
17
Consolidated Statement of Financial Position
Castle Minerals Limited
AT 30 JUNE 2014
Notes
Consolidated
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Financial assets at fair value through profit or loss
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Plant and equipment
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
TOTAL CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
2014
$
310,480
157,333
76,000
543,813
344,113
344,113
2013
$
1,636,882
211,696
-
1,848,578
469,007
469,007
887,926
2,317,585
164,380
164,380
164,380
181,808
181,808
181,808
723,546
2,135,777
23,192,885
884,724
(23,354,063)
723,546
23,044,308
945,210
(21,853,741)
2,135,777
7
8
9
10
11
12
13
The above Consolidated Statement of Financial Position should be read in conjunction with the Notes to the Consolidated Financial Statements.
18
Consolidated Statement of Changes in Equity
Castle Minerals Limited
YEAR ENDED 30 JUNE 2014
Consolidated
BALANCE AT 1 JULY 2012
Loss for the year
OTHER COMPREHENSIVE INCOME
Exchange differences on translation of
foreign operations
TOTAL COMPREHENSIVE INCOME
TRANSACTIONS WITH OWNERS IN THEIR
CAPACITY AS OWNERS
Shares issued during the year
Share issue transaction costs
Options vesting with employees and
contractors
Performance rights issued to employees
Notes
Contributed
Equity
$
22,531,287
-
Share-based
Payments
Reserve
$
Foreign
Currency
Translation
Reserve
$
Accumulated
Losses
$
Total
$
634,883
-
178,746
-
(19,753,925)
(2,099,816)
3,590,991
(2,099,816)
-
-
12
12
526,489
(13,468)
-
-
-
-
-
-
46,937
52,036
32,608
32,608
-
(2,099,816)
32,608
(2,067,208)
-
-
-
-
-
-
-
-
526,489
(13,468)
46,937
52,036
BALANCE AT 30 JUNE 2013
23,044,308
733,856
211,354
(21,853,741)
2,135,777
Loss for the year
OTHER COMPREHENSIVE INCOME
Exchange differences on translation of
foreign operations
TOTAL COMPREHENSIVE INCOME
TRANSACTIONS WITH OWNERS IN THEIR
CAPACITY AS OWNERS
Shares issued during the year
Options vesting with employees and
contractors
Performance rights (cancelled)/vesting
with employees
-
-
-
12
148,577
-
-
-
-
-
-
6,187
(71,902)
-
(1,500,322)
(1,500,322)
5,229
5,229
-
(1,500,322)
5,229
(1,495,093)
-
-
-
-
-
-
148,577
6,187
(71,902)
BALANCE AT 30 JUNE 2014
23,192,885
668,141
216,583
(23,354,063)
688,546
The above Consolidated Statement of Changes in Equity should be read in conjunction with the Notes to the Consolidated Financial Statements.
19
Consolidated Statement of Cash Flows
Castle Minerals Limited
YEAR ENDED 30 JUNE 2014
Notes
Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
Expenditure on mining interests
Proceeds on sale of mining interests
Income tax refund
Other income received
NET CASH (OUTFLOW) FROM OPERATING ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for plant and equipment
NET CASH (OUTFLOW) FROM INVESTING ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issues of ordinary shares
Payment of share issue costs
NET CASH (OUTFLOW)/INFLOW FROM FINANCING ACTIVITIES
NET (DECREASE) IN CASH AND CASH EQUIVALENTS
Cash and cash equivalents at the beginning of the financial year
Effects of exchange rate changes on cash and cash equivalents
CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL YEAR
21
7
2014
$
(413,027)
40,843
(1,189,642)
85,000
174,586
18,085
(1,284,155)
(40,557)
(40,557)
-
(385)
(385)
(1,325,097)
1,636,882
(1,305)
310,480
2013
$
(486,062)
108,537
(2,100,400)
40,000
104,748
10,000
(2,323,177)
(3,903)
(3,903)
526,489
(13,083)
513,406
(1,813,674)
3,443,660
6,896
1,636,882
The above Consolidated Statement of Cash Flows should be read in conjunction with the Notes to the Consolidated Financial Statements.
20
Notes to the Consolidated Financial Statements
Castle Minerals Limited
30 JUNE 2014
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies have been
consistently applied to all the years presented, unless otherwise stated. The financial statements are for the consolidated entity consisting
of Castle Minerals Limited and its subsidiaries. The financial statements are presented in the Australian currency. Castle Minerals Limited
is a company limited by shares, domiciled and incorporated in Australia. The financial statements were authorised for issue by the directors
on 25 September 2014. The directors have the power to amend and reissue the financial statements.
(a) Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations
issued by the Australian Accounting Standards Board and the Corporations Act 2001. Castle Minerals Limited is a for-profit entity for the
purpose of preparing the financial statements.
(i) Compliance with IFRS
The consolidated financial statements of the Castle Minerals Limited Group also comply with International Financial Reporting Standards
(IFRS) as issued by the International Accounting Standards Board (IASB).
(ii) New and amended standards adopted by the Group
The Group has adopted all of the new and revised Standards and Interpretations issued by the AASB that are relevant to their operations
and effective for the current annual reporting period.
New and revised Standards and amendments thereof and Interpretations effective for the first time for the annual reporting period
commencing 1 July 2013 that are relevant to the Group include:
AASB 10 Consolidated Financial Statements;
AASB 11 Joint Arrangements;
AASB 12 Disclosure of Interests in Other Entities;
AASB 13 Fair Value Measurement;
AASB 119 Employee Benefits;
AASB 2012-2 Amendments to Australian Accounting Standards – Disclosures – Offsetting Financial Assets and Financial
Liabilities; and
AASB 2012-5 Amendments to Australian Accounting Standards arising from Annual Improvements 2009-2011 Cycle.
The adoption of all the new and revised Standards and Interpretations has not resulted in any changes to the Group’s accounting policies
and has no effect on the amounts reported for the current or prior years. However, the above standards have affected the disclosures in the
notes to the financial statements.
(iii) Early adoption of standards
The Group has not elected to apply any pronouncements before their operative date in the annual reporting period beginning 1 July 2013.
(iv) Historical cost convention
These financial statements have been prepared under the historical cost convention, as modified by the revaluation of available-for-sale
financial assets, which have been measured at fair value.
(v) Going concern
The financial report has been prepared on a going concern basis, which contemplates the continuity of normal business activity and the
realisation of assets and the settlement of liabilities in the normal course of business.
During the year the Group incurred a net loss of $1,500,322 (2013: $2,099,816) and incurred net cash outflows from operating activities
of $1,284,155 (2013: $2,323,177).
The ability of the Group to continue as a going concern is dependent on the Group being able to raise additional funds to meet ongoing
exploration commitments and for working capital. The Directors believe that they will be able to raise additional capital as required and
are in the process of evaluating the Group’s cash requirements. The Directors believe that the Group will continue as a going concern. As
a result the financial report has been prepared on a going concern basis. However should the Group be unsuccessful in undertaking
additional raisings, the Group may not be able to continue as a going concern. No adjustments have been made relating to the recoverability
and classification of assets and liabilities that might be necessary should the Group not continue as a going concern.
(b) Principles of consolidation
(i) Subsidiaries
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.
The acquisition method of accounting is used to account for business combinations by the Group.
21
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
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 transferred asset. Accounting policies of subsidiaries
have been changed where necessary to ensure consistency with the policies adopted by the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of profit or loss and
other comprehensive income, statement of changes in equity and statement of financial position respectively.
(ii) Changes in ownership interests
The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity owners of the
Group. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling
interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests
and any consideration paid or received is recognised in a separate reserve within equity attributable to owners of Castle Minerals Limited.
When the Group ceases to have control, any retained interest in the entity is remeasured to its fair value with the change in carrying amount
recognised in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest
as an associate, jointly controlled entity or financial asset. In addition, any amounts previously recognised in other comprehensive income
in respect of that entity are accounted for as if the group had directly disposed of the related assets or liabilities. This may mean that
amounts previously recognised in other comprehensive income are reclassified to profit or loss.
If the ownership interest in a jointly controlled entity or associate is reduced but joint control or significant influence is retained, only a
proportionate share of the amounts previously recognised in other comprehensive income are reclassified to profit or loss where appropriate.
(c) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The
chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been
identified as the full Board of Directors.
(d) Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic
environment in which the entity operates (‘the functional currency’). The consolidated financial statements are presented in Australian
dollars, which is Castle Minerals Limited's functional and presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions.
Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates
of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss.
(iii) Group companies
The results and financial position of all the Group entities (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 that 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, the associated exchange differences are reclassified to profit or
loss, as part of the gain or loss on sale.
(e) Revenue recognition
Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the financial assets. Rent revenue
is recognised upon receipt of payment.
22
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
(f) Income tax
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 Company’s subsidiaries and associated 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
provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
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 consolidated financial statements. However, the deferred income tax is 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 reporting date 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 controlled entities where the parent entity 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. 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.
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.
(i) Investment allowances and similar tax incentives
The Group may be entitled to claim special tax deductions for investments in qualifying assets or in relation to qualifying expenditure (eg
the Research and Development Tax Incentive regime in Australia or other investment allowances). The Group accounts for such allowances
as tax credits, which means that the allowance reduces income tax payable and current tax expense or creates an income tax receivable and
current tax benefit.
(g) Leases
Leases of property, plant and equipment where the Group, as lessee, has substantially all the risks and rewards of ownership are classified
as finance leases. Finance leases are capitalised at the lease’s inception at the fair value of the leased property or, if lower, the present value
of the minimum lease payments. The corresponding rental obligations, net of finance charges, are included in other short-term and long-
term payables. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to profit or loss over the
lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The property,
plant and equipment acquired under finance leases is depreciated over the shorter of the asset’s useful life and the lease term.
Leases where a significant portion of the risks and rewards of ownership are not transferred to the Group as lessee are classified as operating
leases (note 17). Payments made under operating leases (net of any incentives received from the lessor) are charged to profit or loss on a
straight-line basis over the period of the lease.
(h) Business combinations
The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other
assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the:
fair values of the assets transferred;
liabilities incurred;
equity interests issued by the Group;
fair value of any asset or liability resulting from a contingent consideration arrangement; and
fair value of any pre-existing equity interest in the subsidiary.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions,
measured initially at their fair values at the acquisition date. The Group recognises any non-controlling interest in the acquired entity on
an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net
identifiable assets.
Acquisition-related costs are expensed as incurred.
23
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
consideration transferred;
amount of any non-controlling interest in the acquired entity; and
acquisition-date fair value of any previous equity interest in the acquired entity;
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
The excess of:
over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net
identifiable assets of the subsidiary acquired, the difference is recognised directly in profit or loss as a bargain purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as
at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which similar borrowing could
be obtained from an independent financier under comparable terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently
remeasured to fair value with changes in fair value recognised in profit or loss.
If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the
aquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from such remeasurement are recognised in profit or
loss.
(i) Impairment of assets
Assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable
amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped
at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other
assets or groups of assets (cash-generating units). Non-financial assets that suffered an impairment are reviewed for possible reversal of
the impairment at the end of each reporting period.
(j) Cash and cash equivalents
For statement of cash flows presentation purposes, cash and cash equivalents includes cash on hand, deposits held at call with financial
institutions, other short-term highly liquid investments with original maturities of three months or less that are readily convertible to known
amounts of cash and which are subject to insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within
borrowings in current liabilities on the statement of financial position.
(k) Trade and other receivables
Receivables are recognised initially at fair value and subsequently at amortised cost. An estimate for doubtful debts is made when collection
of the full amount is no longer probable. Bad debts are written-off as incurred.
(l) Financial assets
Classification
The Group classifies its financial assets in the following categories: loans and receivables; and financial assets at fair value through profit
or loss. The classification depends on the purpose for which the investments were acquired. Management determines the classification of
its financial assets at initial recognition.
(i) Loans and receivables
Loans and receivables are non-derivative 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 reporting date which are classified as non-
current assets.
Collectability of loans and receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off by
reducing the carrying amount directly. An allowance account (provision for impairment) is used when there is objective evidence that the
Group will not be able to collect all amounts due according to the original terms of the receivables or in an otherwise timely manner. The
amount of the impairment allowance is the difference between the asset’s carrying amount and the estimated future cash flows. None of
the Group’s loans and receivables has an applicable interest rate hence the cash flows are not discounted.
The amount of the impairment loss is recognised in the statement of profit or loss and other comprehensive income within impairment
expenses. When a loan or receivable for which an impairment allowance had been recognised becomes uncollectible in a subsequent period,
it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against other expenses
in the statement of profit or loss and other comprehensive income.
(ii) Financial assets at fair value through profit or loss
Financial assets classified as held for trading are included in the category ‘financial assets at fair value through profit or loss’. Financial
assets are classified as held for trading if they are acquired for the purpose of selling in the near term. Derivatives are also classified as held
for trading unless they are designated as effective hedging instruments. Gains or losses on investments held for trading are recognised in
profit or loss.
24
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
Recognition and derecognition
Regular purchases and sales of financial assets are recognised on trade-date, the date on which the Group commits to purchase or sell the
asset. Investments are initially recognised at fair value plus transaction 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.
Measurement
Loans and receivables and held-to-maturity investments are carried at amortised cost using the effective interest method.
Details on how the fair value of financial investments is determined are disclosed in note 2.
Impairment
The Group assesses at each reporting date whether there is objective evidence that a financial asset or group of financial assets is impaired.
If there is evidence of impairment for any of the Group’s financial assets carried at amortised cost, the loss is measured as the difference
between the asset’s carrying amount and the present value of estimated future cash flows, excluding future credit losses that have not been
incurred. The cash flows are discounted at the financial asset’s original effective interest rate. The loss is recognised in the statement of
profit or loss and other comprehensive income.
(m) Plant and equipment
All plant and equipment is stated at historical cost less depreciation and impairment. Historical cost includes expenditure that is directly
attributable to the acquisition of the items.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that
future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying
amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged
to the statement of profit or loss and other comprehensive income during the reporting period in which they are incurred.
Depreciation of plant and equipment is calculated using the reducing balance method to allocate their cost, net of their residual values, over
their estimated useful lives. The rates vary between 20% and 40% per annum.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated
recoverable amount (note 1(i)).
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the statement of profit
or loss and other comprehensive income.
(n) Exploration and evaluation costs
Exploration and evaluation costs are expensed (and not capitalised) in the year they are incurred.
(o) Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year which are unpaid.
They are recognised initially at fair value and subsequently at amortised cost. The amounts are unsecured and are paid on normal
commercial terms.
(p) Employee benefits
(i) Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits, and annual leave expected to be settled within 12 months of the
reporting date are recognised in other payables in respect of employees’ services up to the reporting date and are measured at the amounts
expected to be paid when the liabilities are settled.
(ii) Share-based payments
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’), refer to note 23.
The cost of these equity-settled transactions with employees is measured by reference to the fair value at the date at which they are granted.
The fair value is determined by an internal valuation using an appropriate option pricing model.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the
performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (‘vesting
date’).
25
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the extent to which
the vesting period has expired and (ii) the number of options that, in the opinion of the directors of the Group, will ultimately vest. This
opinion is formed based on the best available information at reporting date. No adjustment is made for the likelihood of market performance
conditions being met as the effect of these conditions is included in the determination of fair value at grant date.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised
for the award is recognised immediately. However, if a new award is substituted for the cancelled award, and designated as a replacement
award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the original award.
Options over ordinary shares have also been issued as consideration for services and the acquisition of interests in tenements. These options
have been treated in the same manner as employee options described above, with the expense being included as part of exploration
expenditure.
(q) Contributed equity
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
Incremental costs directly attributable to the issue of new shares or options for the acquisition of a business are not included in the cost of
the acquisition as part of the purchase consideration.
(r) Earnings per share
(i) Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the Company, excluding any costs of servicing equity
other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus
elements in ordinary shares issued during the year.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income
tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares
assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
(s) Goods and Services Tax (GST) and Value Added Tax (VAT)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the
taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or
payable to, the taxation authority is included with other receivables or payables in the statement of financial position.
The Group’s transactions in Ghana are subject to VAT administered by the Value Added Tax Service of the Republic of Ghana. VAT may
only be recoverable once the Group’s operations are producing revenue in Ghana. Hence, at the Group’s current level of activity, being
exploration, VAT is recognised as part of the cost of acquisition of an asset or as part of an item of expense. Receivables and payables in
the statement of financial position are shown inclusive of VAT.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are
recoverable from, or payable to the respective taxation authorities, are presented as operating cash flows.
(t) Share-based payments
The Group granted benefits to suppliers and consultants in the form of share-based payment transactions.
The share-based payments are measured at fair value equal to the value of goods and services received.
(u) New accounting standards and interpretations
Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2014 reporting periods. The
Group’s assessment of the impact of these new standards and interpretations is set out below. New standards and interpretations not
mentioned are considered unlikely to impact on the financial reporting of the Group.
AASB 9: Financial Instruments, AASB 2009-11 Amendments to Australian Accounting Standards arising from AASB 9, AASB 2010-7
Amendments to Australian Accounting Standards arising from AASB 9 (December 2010), AASB 2012-6 Amendments to Australian
Accounting Standards – Mandatory Effective Date of AASB 9 and Transition Disclosures and AASB 2013-9 Amendments to Australian
Accounting Standards – Conceptual Framework, Materiality and Financial Instruments (effective from 1 January 2017)
AASB 9 replaces the multiple classification and measurement models in AASB 139 Financial instruments: Recognition and measurement
with a single model that has only two classification categories: amortised cost and fair value.
26
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
Classification of debt assets will be driven by the entity’s business model for managing the financial assets and the contractual cash flow
characteristics of the financial assets. A ‘simple’ debt instrument is measured at amortised cost if: a) the objective of the business model is
to hold the financial asset for the collection of the contractual cash flows, and b) the contractual cash flows under the instrument solely
represent payments of principal and interest.
All other financial assets, including investments in complex debt instruments and equity investments, must be recognised at fair value.
All fair value movements on financial assets are taken through the income statement, except for equity investments that are not traded,
which may be recorded in the income statement or in reserves.
For financial liabilities that are measured under the fair value option entities will need to recognise the part of the fair value change that is
due to changes in their own credit risk in other comprehensive income rather than profit or loss.
The new hedge accounting rules that were released in December 2013 align hedge accounting more closely with common risk management
practices. As a general rule, it will be easier to apply hedge accounting going forward. The new standard also introduces expanded
disclosure requirements and changes in presentation.
Based on the financial assets and liabilities currently held, the Group does not anticipate any impact on the financial statements upon
adoption of this standard. The Group does not presently engage in hedge accounting.
None of the other amendments or Interpretations are expected to affect the accounting policies of the Group.
(v) Critical accounting judgements, estimates and assumptions
The preparation of these financial statements requires the use of certain critical accounting estimates. It also requires management to
exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or
complexity, or areas where assumptions and estimates are significant to the financial statements are:
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 by an internal valuation using an appropriate option pricing model or quoted
active market price, using the assumptions detailed in note 23. If any of these assumptions, including the probability of achieving the
performance hurdle were to change, there may be an impact on the amounts reported.
Exploration expenditure
Exploration and evaluation costs are expensed as they are incurred.
VAT Recoverability
The Group pays VAT on invoices from Ghana which is expensed as incurred until such time as the Group goes into production and can
recover the past 12 months’ expense incurred prior to production commencing.
2.
FINANCIAL RISK MANAGEMENT
The Group’s activities expose it to a variety of financial risks: market risk (including currency risk and interest rate risk), credit risk and
liquidity risk. The Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise
potential adverse effects on the financial performance of the Group.
Risk management is carried out by the full Board of Directors as the Group believes that it is crucial for all board members to be involved
in this process. The executive chairman, with the assistance of senior management as required, has responsibility for identifying, assessing,
treating and monitoring risks and reporting to the board on risk management.
(a) Market risk
(i) Foreign exchange risk
The Group operates internationally and are exposed to foreign exchange risk arising from various currency exposures, primarily with
respect to the US dollar.
Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is
not the entity’s functional currency. The Group has not formalised a foreign currency risk management policy however, it monitors its
foreign currency expenditure in light of exchange rate movements.
The functional currency of the subsidiary companies is the US dollar. All parent entity balances are in Australian dollars and all Group
balances are in either Australian or US dollars, so the Group does not have any exposure to foreign currency risk at the reporting date
(2013: Nil exposure).
(ii) Price risk
The Group is exposed to equity securities price risk. This arises from investments held by the Group and classified in the statement of
financial position as at fair value through profit or loss. Given the current level of operations, the Group is not currently exposed to
commodity price risk.
27
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
FINANCIAL RISK MANAGEMENT (cont’d)
2.
To minimise the risk the Group’s investments are of high quality and are publicly traded on the ASX. The investments are managed on a
day to day basis so as to pick up any significant adjustments to market prices.
Sensitivity analysis
At 30 June 2014, if the value of the equity instruments held had increased/decreased by 15% with all other variables held constant, post-
tax loss for the Group would not have been $6,150 lower/higher as a result of gains/losses on equity securities classified as at fair value
through profit or loss (2013: N/A).
(iii) Interest rate risk
The Group is exposed to movements in market interest rates on cash and cash equivalents. The Group policy is to monitor the interest rate
yield curve out to 120 days to ensure a balance is maintained between the liquidity of cash assets and the interest rate return.
Sensitivity analysis
At 30 June 2014, if interest rates had changed by -/+ 100 basis points from the weighted average rate for the year with all other variables
held constant, post-tax loss for the Group would have been $10,500 lower/higher (2013: $22,500 lower/higher) as a result of lower/higher
interest income from cash and cash equivalents. The directors believe that in the current economic environment a 1% increase in interest
rates is reasonable given comments made by the Reserve Bank of Australia. Weighted average interest rate for the year was 3.2% (2013:
4.2%).
(b) Credit risk
The maximum exposure to credit risk at reporting date is the carrying amount (net of provision for impairment) of those assets as disclosed
in the statement of financial position and notes to the financial statements. The only significant concentration of credit risk for the Group
is the cash and cash equivalents held with financial institutions. All material deposits are held with the major Australian banks for which
the Board evaluate credit risk to be minimal.
As the Group does not presently have any trade receivables, lending, significant stock levels or any other credit risk, a formal credit risk
management policy is not maintained.
(c) Liquidity risk
The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and ensuring sufficient cash and marketable
securities are available to meet the current and future commitments of the Group. Due to the nature of the Group’s activities, being mineral
exploration, the Group does not have ready access to credit facilities, with the primary source of funding being equity raisings. The Board
of Directors constantly monitor the state of equity markets in conjunction with the Group’s current and future funding requirements, with
a view to initiating appropriate capital raisings as required.
The financial liabilities of the Group are confined to trade and other payables as disclosed in the statement of financial position. All trade
and other payables are non-interest bearing and due within 12 months of the reporting date.
(d) Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. .
The equity investments held by the Group are classified as available-for-sale. The market value of all equity investments represents the fair
value based on quoted prices on active markets (ASX) as at the reporting date without any deduction for transaction costs. These
investments are classified as level 1 financial instruments.
The carrying amounts and estimated fair values of financial assets and financial liabilities are as follows:
Consolidated
Financial Assets
Cash and cash equivalents
Trade and other receivables
Available-for-sale financial assets
Total Financial Assets
Financial Liabilities
Trade and other payables
Total Financial Liabilities
2014
$
310,480
157,333
76,000
543,813
164,380
164,380
2013
$
1,636,882
211,696
-
1,848,578
181,808
181,808
The methods and assumptions used to estimate the fair value of financial instruments are outlined below:
28
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
FINANCIAL RISK MANAGEMENT (cont’d)
2.
Cash
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.
Fair value measurements of financial assets
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:
Level 2:
quoted prices (unadjusted) in active markets for identical assets or liabilities;
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
inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Level 3:
30 June 2014
Available-for-sale financial asset
Total as at 30 June 2014
30 June 2013
Available-for-sale financial asset
Total as at 30 June 2013
Level 1
$
76,000
76,000
-
-
Level 2
$
Level 3
$
-
-
-
-
-
-
-
-
Total
$
76,000
76,000
-
-
Due to their short term nature, the carrying amount of the current receivables and current payables is assumed to approximate their fair
value.
29
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
3.
SEGMENT INFORMATION
For management purposes, the Group has identified only one reportable segment being exploration activities undertaken in Ghana, West
Africa. This segment includes activities associated with the determination and assessment of the existence of commercial economic
reserves, from the Group’s mineral assets in this geographic location.
Segment performance is evaluated based on the operating profit and loss and cash flows and is measured in accordance with the Group’s
accounting policies.
Consolidated
2014
$
2013
$
337,000
40,000
33,326
22,043
392,369
93,739
11,800
145,539
(550,385)
(865,412)
(15,373)
(1,071,005)
(1,636,763)
(18,418)
(1,390,572)
(2,274,402)
280,952
468,047
606,974
887,926
1,849,538
2,317,585
-
40,557
40,557
538
3,365
3,903
33,326
93,739
337,000
22,043
359,043
40,000
11,800
51,800
Ghana exploration segment
Ghana segment income
Reconciliation of Ghana segment revenue to total revenue before tax:
Interest revenue
Other income
Total revenue
Ghana segment results
Reconciliation of Ghana segment result to net loss before tax:
Corporate depreciation
Other corporate and administration
Net loss before tax
Ghana segment operating assets
Reconciliation of Ghana segment operating assets to total assets:
Other corporate and administration assets
Total assets
Total assets includes additions to plant and equipment:
Ghana exploration segment
Other corporate and administration
4.
REVENUE AND OTHER INCOME
(a) Revenue
Other revenue
Interest
(b) Other income
Profit on sale of mining interests
Other
30
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
5.
EXPENSES
Loss before income tax includes the following specific expenses:
Defined contribution superannuation expense
Minimum lease payments relating to operating leases
Impairment of trade and other receivables (see note 8(a))
Depreciation
Fair value loss on investments held for trading
6.
INCOME TAX
(a) Income tax benefit
Current tax
Deferred tax
Research and Development refund
Consolidated
2014
$
22,057
15,530
-
156,188
176,000
2013
$
29,700
36,532
31,729
144,099
-
-
-
(136,441)
(136,441)
-
-
(174,586)
(174,586)
(b) Numerical reconciliation of income tax expense to prima facie tax
payable
Loss from continuing operations before income tax expense
(1,636,763)
(2,274,402)
Prima facie tax benefit at the Australian tax rate of 30% (2013: 30%)
Tax effect of amounts which are not deductible (taxable) in calculating
taxable income:
Share-based payments
Other
Movements in unrecognised temporary differences
Tax effect of current year tax losses for which no deferred tax asset has been
recognised
Foreign tax rate differential
Research and Development refund
Income tax benefit
(c) Unrecognised temporary differences
Deferred Tax Assets (at 30%)
On Income Tax
Account
Capital raising costs
Foreign exploration tax losses
Accruals and other provisions
Financial assets at fair value
Australian carry forward tax losses
(491,029)
(682,321)
(19,715)
174,316
(336,428)
29,692
284,526
(368,103)
30,312
7,311
352,486
(46,370)
(136,441)
(136,441)
404,476
(43,684)
(174,586)
(174,586)
4,787
6,291,351
7,387
52,800
571,017
6,927,342
25,170
6,043,878
27,764
-
602,743
6,699,555
Deferred Tax Liabilities (at 30%)
-
-
Net deferred tax assets have not been brought to account as it is not probable within the immediate future that tax profits will be available
against which deductible temporary differences and tax losses can be utilised.
The Group’s ability to use losses in the future is subject to the companies in the Group satisfying the relevant tax authority’s criteria for
using these losses. Foreign exploration tax losses are incurred in Ghana and are arrived at after adjusting losses reported in financial
statements in line with tax principles. Mining concerns are allowed to deduct the losses over a five-year period subsequent to the year in
which the loss was incurred.
31
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
7.
CURRENT ASSETS – CASH AND CASH EQUIVALENTS
Cash at bank and in hand
Short-term deposits
Cash and cash equivalents as shown in the statement of financial position and
the statement of cash flows
Consolidated
2014
$
109,083
201,397
310,480
2013
$
454,494
1,182,388
1,636,882
Cash at bank and in hand earns interest at floating rates based on daily bank deposit rates.
Short-term deposits are made for varying periods of between one day and three months depending on the immediate cash requirements of
the Group, and earn interest at the respective short-term deposit rates, refer to note 2(a)(iii).
8.
CURRENT ASSETS – TRADE AND OTHER RECEIVABLES
Government taxes receivable
Allowance for impairment (note (a))
Other receivables
143,531
-
13,802
157,333
185,521
-
26,175
211,696
Other receivables are not past due nor impaired, and based on history are expected to be fully recoverable. Refer below for details on
Government taxes receivable. Information about the Group’s exposure to credit risk is provided in note 2.
(a) Impaired receivables
During the prior year the VAT receivable from the Group’s operations in Ghana was written off as uncollectible, and the accounting
procedures have been changed to expense VAT as incurred. In prior periods the VAT was recognised as a receivable but provided for in
full as a doubtful debt. The VAT may only be recoverable once the Group’s operations are producing revenue in Ghana.
Movements in the allowance for impairment of receivables are as follows:
Balance at the beginning of the year
Allowance for impairment recognised during the year
Foreign exchange movements
Receivables written off during the year as uncollectible
9.
CURRENT ASSETS – FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
Australian listed equity securities
Opening value
Acquisitions
Revaluation adjustment through profit or loss
Closing value
-
-
-
-
-
1,253,419
31,729
(12,213)
(1,272,935)
-
-
252,000
(176,000)
76,000
-
-
-
-
The equity investments are all classified as held for trading. The market value of all equity investments represent the fair value based on
quoted prices on active markets (ASX) as at the reporting date without any deduction for transaction costs. These investments are classified
as Level 1 financial instruments. There have been no transfers between levels of the fair value hierarchy used in measuring the fair value
of these financial instruments, or changes in its classification as a result of a change in the purpose or use of these assets.
32
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
10. NON-CURRENT ASSETS – PLANT AND EQUIPMENT
Consolidated
At 1 July 2012
Cost
Accumulated
depreciation
Net book
amount
Year ended 30 June 2013
Opening net book
amount
Exchange differences
Additions
Depreciation
charge
Closing net book
amount
At 30 June 2013
Cost
Accumulated
depreciation
Net book
amount
Year ended 30 June 2014
Opening net book
amount
Exchange differences
Additions
Depreciation
charge
Closing net book
amount
At 30 June 2014
Cost
Accumulated
depreciation
Plant and Equipment Motor Vehicles Computer Equipment
$
$
$
Total
$
494,456
136,942
96,522
727,920
(76,751)
(23,724)
(59,990)
(160,465)
417,705
113,218
36,532
567,455
417,705
33,618
176
113,218
7,811
-
36,532
319
3,727
567,455
41,748
3,903
(88,147)
(39,877)
(16,075)
(144,099)
363,352
81,152
24,503
469,007
541,601
152,343
101,162
795,106
(178,249)
(71,191)
(76,659)
(326,099)
363,352
81,152
24,503
469,007
363,352
(7,945)
40,557
81,152
(1,295)
-
24,503
(23)
-
469,007
(9,263)
40,557
(101,191)
(45,101)
(9,896)
(156,188)
294,773
34,756
14,584
344,113
563,199
147,710
72,841
783,750
(268,426)
(112,954)
(58,257)
(439,637)
33
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
Net book
amount
294,773
34,756
14,584
344,113
11. CURRENT LIABILITIES - TRADE AND OTHER PAYABLES
Trade payables
Other payables and accruals
Consolidated
2014
$
83,482
80,898
164,380
2013
$
74,847
106,961
181,808
Information about the Group’s exposure to foreign exchange and liquidity risk is provided in note 2.
34
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
12. CONTRIBUTED EQUITY
(a) Share capital
Ordinary shares fully paid
Total contributed equity
(b) Movements in ordinary share capital
Beginning of the financial year
Issued during the year:
Issued for cash at 5 cents
Issued as consideration for drilling services
Less: Transaction costs
End of the financial year
(c) Movements in options on issue
Beginning of the financial year
End of the financial year
(d) Movements in performance rights on issue
Beginning of the financial year
End of the financial year
2014
2013
Notes
Number of
shares
$
Number of
shares
$
12(b), 12(e) 128,492,519
23,192,885
124,247,452
23,044,308
128,492,519
23,192,885
124,247,452
23,044,308
124,247,452
23,044,308
113,717,677
22,531,287
23(c)
-
4,245,067
-
128,492,519
-
148,577
-
23,192,885
10,529,775
-
-
124,247,452
526,489
-
(13,468)
23,044,308
Number of options
2013
2014
1,050,000
1,050,000
1,050,000
1,050,000
Number of performance rights
2014
2,000,000
2,000,000
2013
2,000,000
2,000,000
(e) Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number
of and amounts paid on the 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.
Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
(f) Capital risk management
The Group’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they may continue to
provide returns for shareholders and benefits for other stakeholders.
Due to the nature of the Group’s activities, being mineral exploration, the Group does not have ready access to credit facilities, with the
primary source of funding being equity raisings. Therefore, the focus of the Group’s capital risk management is the current working capital
position against the requirements of the Group to meet exploration programmes and corporate overheads. The Group’s strategy is to ensure
appropriate liquidity is maintained to meet anticipated operating requirements, with a view to initiating appropriate capital raisings as
required. The working capital position of the Group at 30 June 2014 and 30 June 2013 are as follows:
Cash and cash equivalents
Trade and other receivables
Financial assets at fair value through profit or loss
Trade and other payables
Working capital position
35
Consolidated
2014
$
310,480
157,333
76,000
(164,380)
379,433
2013
$
1,636,882
211,696
-
(181,808)
1,666,770
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
Consolidated
13. RESERVES AND ACCUMULATED LOSSES
(a) Reserves
Foreign currency translation reserve
Share-based payments reserve
2014
$
216,583
668,141
884,724
2013
$
211,354
733,856
945,210
(b) Nature and purpose of reserves
(i) Foreign currency translation reserve
Exchange differences arising on translation of the foreign controlled entity are recognised in other comprehensive income as described in
note 1(d) and accumulated within a separate reserve within equity. The cumulative amount is reclassified to profit or loss when the net
investment is disposed of.
(ii) Share-based payments reserve
The share-based payments reserve is used to recognise the fair value of options and performance rights granted.
14. DIVIDENDS
No dividends were paid during the financial year. No recommendation for payment of dividends has been made.
15. REMUNERATION OF AUDITORS
During the year the following fees were paid or payable for services provided by the auditor of the parent entity, its related practices and
non-related audit firms:
(a) Audit services
BDO Audit (WA) Pty Ltd - audit and review of financial reports
Non-related audit firm for the audit or review of financial reports of Group
subsidiary entities
Total remuneration for audit services
(b) Non-audit services
BDO (WA) Pty Ltd - tax compliance services
Total remuneration for other services
16. CONTINGENCIES
30,475
4,274
34,749
6,630
6,630
25,041
13,110
38,151
8,640
8,640
Newmont Option Agreement
During the 2009 financial year the Group completed the acquisition of the Wa Reconnaissance Licence from Newmont Ghana Gold Limited
(“NGGL”). NGGL will be entitled to a 1% net smelter royalty on any minerals produced from the licence area if the Group relinquishes
control of the licence within 5 years of the Approval Date.
All granted projects are 100% owned by Castle Minerals (subject to Ghanaian Government right to a free-carried 10% interest). Castle’s
corporate objectives are exploration and development of its six projects in Ghana and the acquisition and exploration of other mineral
resource opportunities, particularly in West Africa. The country of Ghana has a long history of gold mining and exploration and is Africa’s
second largest gold producer behind South Africa.
36
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
17. COMMITMENTS
Lease commitments: Group as lessee
Operating leases (non-cancellable):
Minimum lease payments
within one year
later than one year but not later than five years
Aggregate lease expenditure contracted for at reporting date but not
recognised as liabilities
Consolidated
2014
$
2013
$
-
-
-
29,102
-
29,102
The property lease that expired on 30 November 2013 was a non-cancellable lease with a three-year term, with rent payable monthly in
advance. Contingent rental provisions within the lease agreement required the minimum lease payments to be increased by 5% per annum.
The lease allowed for subletting of all lease areas. Premises are currently rented on a month-by-month basis, with no fixed commitment.
18. RELATED PARTY TRANSACTIONS
(a) Parent entity
The ultimate parent entity within the Group is Castle Minerals Limited.
(b) Subsidiaries
Interests in subsidiaries are set out in note 19.
(c) Key management personnel compensation
Short-term benefits
Post-employment benefits
Other long-term benefits
Termination benefits
Share-based payments
349,825
15,401
-
-
(71,902)
293,324
590,725
24,825
-
-
52,036
667,586
Detailed remuneration disclosures are provided in the remuneration report on pages 5 to 8.
(d) Transactions and balances with other related parties
Transactions with related parties are disclosed in the Directors’ Report.
(e) Loans to related parties
Castle Minerals Limited has provided unsecured, interest free loans to its wholly owned subsidiaries Carlie Mining Limited and Topago
Mining Limited totalling $17,942,637 (2013: $17,211,410). An impairment assessment is undertaken each financial year by examining the
financial position of each subsidiary and the market in which the respective subsidiary operates to determine whether there is objective
evidence that the subsidiary is impaired. When such objective evidence exists, the Company recognises an allowance for the impairment
loss.
19. SUBSIDIARIES
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the
accounting policy described in note 1(b):
Name
Country of incorporation
Equity Holding*
Class of shares
Carlie Mining Ltd
Topago Mining Ltd
Ghana
Ghana
Ordinary
Ordinary
*The proportion of ownership interest is equal to the proportion of voting power held.
2014
%
100
100
2013
%
100
100
37
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
Consolidated
2014
$
2013
$
20. EVENTS OCCURRING AFTER THE REPORTING DATE
No matter or circumstance has arisen since 30 June 2014, which has significantly affected, or may significantly affect the operations of the
Group, the result of those operations, or the state of affairs of the Group in subsequent financial years.
21. CASH FLOW INFORMATION
Reconciliation of net loss after income tax to net cash outflow from
operating activities
Net loss for the year
Non-Cash Items
Depreciation of non-current assets
Net exchange differences
Share based payment expense
Fair value loss on financial assets at fair value through profit or loss
Financial assets received as consideration on sale mining interests
Shares issued as consideration for drilling services*
Change in operating assets and liabilities
Decrease/(increase) in trade and other receivables
(Decrease) in trade and other payables
Net cash outflow from operating activities
(1,500,322)
(2,099,816)
156,188
14,649
(65,715)
176,000
(252,000)
148,577
54,363
(15,895)
(1,284,155)
144,099
32,129
98,973
-
-
-
(45,218)
(453,344)
(2,323,177)
As at 30 June 2014 the Group had no non-cash investing and financing activities, except as noted below.
* Shares issued as consideration for drilling services is mentioned in note 23(c).
22. LOSS PER SHARE
(a) Reconciliation of earnings used in calculating loss per share
Loss attributable to the owners of the Company used in calculating basic and
diluted loss per share
(b) Weighted average number of shares used as the denominator
Weighted average number of ordinary shares used as the denominator in
calculating basic and diluted loss per share
(1,500,322)
(2,099,816)
Number of shares
Number of shares
125,747,763
114,265,802
(c) Information on the classification of options
As the Group has made a loss for the year ended 30 June 2014, all options on issue are considered anti-dilutive and have not been included
in the calculation of diluted earnings per share. These options could potentially dilute basic earnings per share in the future.
38
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
23. SHARE-BASED PAYMENTS
(a) Employees and Contractors Option Plan
The Group provides benefits to employees (including directors) and contractors of the Group in the form of share-based payment
transactions, whereby employees or consultants render services in exchange for options to acquire ordinary shares. The exercise price of
the options granted under the plan is 40 cents per option, with an expiry date of 1 September 2016.
Options granted carry no dividend or voting rights. When exercisable, each option is convertible into one ordinary share in the capital of
the Company with full dividend and voting rights.
Set out below are summaries of granted options:
Outstanding at the beginning of the year
Granted
Forfeited
Exercised
Expired
Outstanding at year-end
Exercisable at year-end
Consolidated
2014
2013
Weighted
average
exercise price
cents
40.0
-
-
-
-
40.0
40.0
Weighted
average
exercise price
cents
40.0
-
-
-
-
40.0
40.0
Number of
options
1,050,000
-
-
-
-
1,050,000
700,000
Number of
options
1,050,000
-
-
-
-
1,050,000
1,050,000
The weighted average remaining contractual life of share options outstanding at the end of the year was 2.17 years (2013: 3.17 years), and
the exercise price is 40 cents. Option expiry date is 1 September 2016
There were no options granted during the 2014 or 2013 financial years.
(b) Employees and contractors performance rights
The Group provides benefits to employees (including directors) and contractors of the Group in the form of share-based payment
transactions, whereby performance rights over ordinary shares are issued as an incentive to improve employee and shareholder goal
congruence. Performance rights granted to the Managing Director have an expiry date of 22 November 2016 whilst rights granted to an
employee have no expiration date.
Performance rights granted carry no dividend or voting rights. When each performance condition is satisfied, each performance right is
converted into one ordinary share of the Company with full dividend and voting rights.
Set out below are summaries of the performance rights granted:
Outstanding at the beginning of the year
Granted
Forfeited/cancelled
Exercised
Expired
Outstanding at year-end
2014
3,000,000
-
(1,000,000)
-
-
2,000,000
2013
3,000,000
-
-
-
-
3,000,000
There were no performance rights granted during the 2014 or 2013 financial years. The performance rights previously granted to an
employee were cancelled by right of forfeiture when the employee left the Company’s employment in February 2014. Therefore, as no
rights have ultimately vested due to failure to satisfy the vesting conditions, the previously expensed amount ($92,400) has been reversed
during the current period.
(c) Shares issued to suppliers
On 21 February 2014, 4,245,067 ordinary shares were issued at the invoiced value of $148,577 as consideration for drilling services and
are included as part of the ‘Tenement acquisition and exploration expenses’ on the statement of profit or loss and other comprehensive
income of the Group for the 2014 financial year.
39
Notes to the Consolidated Financial Statements continued
Castle Minerals Limited
30 JUNE 2014
23. SHARE-BASED PAYMENTS (cont’d)
(d) Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions recognised during the period were as follows:
Options granted to and vesting with employees and contractors
Performance rights (cancelled)/granted to and vesting with employees
Shares issued to a supplier
Consolidated
2014
$
6,187
(71,902)
148,577
82,862
2014
$
2013
$
46,937
52,036
-
98,973
2013
$
24. PARENT ENTITY INFORMATION
The following information relates to the parent entity, Castle Minerals Limited, at 30 June 2014. The information presented here has been
prepared using accounting policies consistent with those presented in note 1.
Current assets
Non-current assets
Total assets
Current liabilities
Total liabilities
Contributed equity
Share-based payments reserve
Accumulated losses
Total equity
Loss for the year
Total comprehensive loss for the year
537,920
69,052
606,972
122,799
122,799
23,192,885
668,141
(23,376,853)
484,173
(1,304,167)
(1,304,167)
1,805,670
43,869
1,849,539
144,061
144,061
23,044,308
733,856
(22,072,686)
1,705,478
(2,355,923)
(2,355,923)
As detailed in note 16, there are contingent liabilities in respect to tenement acquisition agreements that the parent entity has co-signed
with subsidiary entities.
40
Directors' Declaration
Castle Minerals Limited
In the directors’ opinion:
(a)
the financial statements comprising the statement of profit or loss and other comprehensive income, statement of financial position,
statement of changes in equity, statement of cash flows and accompanying notes set out on pages 17 to 39 are in accordance with
the Corporations Act 2001, including:
(i)
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting
requirements; and
giving a true and fair view of the consolidated entity’s financial position as at 30 June 2014 and of its performance for the
financial year ended on that date;
(ii)
(b)
(c)
(d)
there are reasonable grounds to believe that the consolidated entity will be able to pay its debts as and when they become due and
payable;
the remuneration disclosures included in the Directors’ Report (as part of the audited Remuneration Report), for the year ended 30
June 2014, comply with Section 300A of the Corporations Act 2001; and
a statement that the attached financial statements are in compliance with International Financial Reporting Standards has been
included in the notes to the financial statements.
The directors have been given the declarations by the chief executive officer and chief financial officer required by section 295A of the
Corporations Act 2001.
This declaration is made in accordance with a resolution of the directors.
Michael Ivey
Managing Director
Perth, 25 September 2014
41
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 Castle Minerals Limited
Report on the Financial Report
We have audited the accompanying financial report of Castle Minerals Limited, which comprises the
consolidated statement of financial position as at 30 June 2014, 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, notes comprising a summary of
significant accounting policies and other explanatory information, and the directors’ declaration of the
consolidated entity comprising the company and the entities it controlled at the year’s end or from
time to time during the financial year.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error. In Note 1(a)(i), the directors also state, in accordance with Accounting Standard AASB
101 Presentation of Financial Statements, that the financial statements comply with International
Financial Reporting Standards.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. Those standards require that we comply with
relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial report. The procedures selected depend on the auditor’s judgement, including the
assessment of the risks of material misstatement of the financial report, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the company’s
preparation of the financial report that gives a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the company’s internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of accounting estimates made by the directors, as
well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations
Act 2001. We confirm that the independence declaration required by the Corporations Act 2001, which
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) in each State or Territory other than Tasmania.
has been given to the directors of Castle Minerals Limited, would be in the same terms if given to the
directors as at the time of this auditor’s report.
Opinion
In our opinion:
(a)
the financial report of Castle Minerals Limited is in accordance with the Corporations Act 2001,
including:
(i)
giving a true and fair view of the consolidated entity’s financial position as at 30 June 2014
and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b)
the financial report also complies with International Financial Reporting Standards as disclosed in
Note 1(a)(i).
Emphasis of matter
Without modifying our opinion, we draw attention to Note 1a(v) in the financial report, which indicates
that the ability of the consolidated entity to continue as a going concern is dependent upon the future
successful raising of necessary funding through equity. This condition, along with other matters as set
out in Note 1a(v), indicate the existence of a material uncertainty that may cast significant doubt
about the consolidated entity’s ability to continue as a going concern and therefore, the consolidated
entity may be unable to realise its assets and discharge its liabilities in the normal course of business.
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June
2014. 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.
Opinion
In our opinion, the Remuneration Report of Castle Minerals Limited for the year ended 30 June 2014
complies with section 300A of the Corporations Act 2001.
BDO Audit (WA) Pty Ltd
Glyn O'Brien
Director
Perth, 25 September 2014
ASX Additional Information
Castle Minerals Limited
Additional information required by Australian Stock Exchange Ltd and not shown elsewhere in this report is as follows. The information
is current as at 15 September 2014.
(a) Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
1
1,001
5,001
10,001
100,001
-
-
-
-
1,000
5,000
10,000
100,000
and over
The number of shareholders holding less than a marketable parcel of shares are:
(b) Equity Security Holders
Twenty largest quoted equity security holders
The names of the twenty largest holders of quoted ordinary shares are:
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Azumah Res Ltd
Lujeta Pty Ltd
Bridgelane Capital Pty Ltd
Henry Wiechecki
Trailstar Ltd
M Ivey PL
Merrill Lynch Aust Nom PL
Ausdrill Intnl PL
Michael Ashforth
Bluestar Res Ltd
Kingston Mgmnt
M Ivey PL Super Account
Computer Visions PL
Bunda Holdings PL
Twynam Agricultural Group PL
Ivoryrose Holdings PL
Grizzley Holdings PL
Zadar Holdings PL
Foxton Nominees PL
ABN Amro Clearing
Unquoted equity securities
Ordinary shares
Number of holders Number of shares
30
85
113
314
104
646
299
4,379
249,027
950,962
11,822,808
115,465,343
128,492,519
Listed ordinary shares
Number of shares
19,315,812
10,220,000
7,550,000
7,279,100
4,702,256
4,453,179
4,285,714
4,245,067
3,830,000
3,784,644
3,777,663
2,893,319
2,335,000
2,333,000
2,076,670
1,915,000
1,810,807
1,388,436
1,310,000
1,281,618
90,787,285
Percentage of
ordinary shares
15.03
7.95
5.88
5.66
3.66
3.47
3.34
3.30
2.98
2.95
2.94
2.25
1.82
1.82
1.62
1.49
1.41
1.08
1.02
1.00
70.67
Options issued under the Castle Minerals Limited Employees and Contractors Option
Plan to take up ordinary shares
Performance Rights issued under the Castle Minerals Limited Performance Rights Plan
to take up ordinary shares
1,050,000
2,000,000
1
1
Number on issue
Number of holders
44
ASX Additional Information continued
Castle Minerals Limited
(c) Substantial shareholders
The names of substantial shareholders who have notified the Company in accordance with section 671B of the Corporations Act 2001
are:
Number of Shares
19,315,812
Azumah Resources Limited
10,135,000
Lujeta Pty Ltd
7,550,000
Bridgelane Capital Pty Ltd
8,527,919
David Harper
Henry Wiechecki
7,279,100
Michael Ivey 7,378,498
(d) Voting rights
All ordinary shares (whether fully paid or not) carry one vote per share without restriction.
(e) There are no restricted securities or securities subject to voluntary escrow on issue
(f) There is no current on market buy back
(g) Schedule of interests in mining tenements
Location
Antubia, Ghana
Antubia, Ghana
Bondaye, Ghana
Akoko, Ghana
Akoko, Ghana
Opon Mansi, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
Wa, Ghana
*Tenements under Option/Sale Agreement to Merah Resources Limited (ASX: MEH) where MEH may acquire a 100% interest.
Government of Ghana has the right to acquire a 10% free carried interest in all tenements.
Tenement Reference
PL2/400
PL2/399
Application
PL. 2/398
PL. 2/425
Application
Application
RL. 10/23
PL. 10/13
RL. 10/13
PL 10/26
PL 10/23
PL 10/25
Application
PL 10/24
Application
Application
PL.10/34
PL.10/32
PL.10/29
PL.10/33
PL 10/28
PL.10/31
PL.10/30
PL.10/27
RL. 8/27
RL. 8/28
RL. 8/31
RL. 8/30
RL. 8/29
Application
PL10/47
Tenement Name
Boizan
Antubia (Juabeso)
Bondaye
Akoko
Akoko West
Opon Mansi
Wonachiyiri
Jang
Julie West
Wa
Degbiwu
Bulenga
Charingu
Kandia
Baayiri
Kunche Trend 1
Kunche Trend 2
Sawla
Sawla East
Sawla South
Jandra
Jandra North
Tuna
Jang North
Jang North West
Gbinyiri
Gurungu
Jumo
Chasia
Perisi
Funsi
Kambale
Percentage held
100*
100*
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100*
100*
100*
100*
100*
100*
100*
100*
100
100
100
100
100
100
100
45