C U L L E N
R E S O U R C E S L I M I T E D
A N N U A L R E P O R T 2 0 1 4
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Cullen Resources Limited
CORPORATE DIRECTORY
CONTENTS
Chairman's Report
Company Profile
Highlights
Exploration Review
Directors' Report
Corporate Governance Statement
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Comprehensive
Income
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors' Declaration
Independent Audit Report
Shareholder Information
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3
4
5
17
27
30
31
32
33
34
59
60
62
ABN: 46 006 045 790
Directors
Denis Clarke (Non-executive Chairman)
Chris Ringrose (Managing Director)
John Horsburgh (Non-executive)
Grahame Hamilton (Non-executive)
Wayne Kernaghan (Non-executive)
Secretary
Wayne Kernaghan
Registered and Principal Office
Unit 4
7 Hardy Street
South Perth WA 6151
Telephone +61 (8) 9474 5511
Facsimile +61 (8) 9474 5588
Auditors
Ernst & Young
11 Mounts Bay Road
Perth WA 6000
Solicitors
Lavan Legal
1 William Street
Perth WA 6000
Bankers
Westpac
Sydney NSW 2000
Securities Quoted
Australian Stock Exchange
Limited
Home Exchange - Sydney
ASX Code: CUL
Share Registry
Computershare Investor
Services
Level 3, 60 Carrington Street
Sydney NSW 2000
Telephone (02) 8234 5000
www.computershare.com
Email
cullen@cullenresources.com.au
Company Website
www.cullenresources.com.au
Chairman’s Report
2
DEAR FELLOW SHAREHOLDER
During the past year junior explorers have again endured difficult market conditions, and capital
management and project prioritisation has been the watch word. In response, Cullen has
curtailed overseas exploration activities in favour of concentrating generally on two main
objectives: maintaining its participating interest in the Mt Stuart Iron Ore Joint Venture
(MSIOJV), and exploring for nickel sulphide deposits and gold in its 100% owned Mt Eureka
project, both in Western Australia.
The most significant development in regards to the company's iron ore assets in the West
Pilbara has been the takeover of Aquila Resources Limited by Baosteel Resources Australia
Pty Ltd (Baosteel) and Aurizon Operations Limited (Aurizon), which was successfully
concluded in July 2014. Baosteel, with Aurizon, has indicated its intention to move forward
quickly towards rail and port development for exploitation of the West Pilbara Iron Ore Project
(WPIOP) resources. Cullen through the MSIO JV owns 30% of the Catho Well channel iron ore
deposit which has been previously proposed as a starter pit for the 30Mtpa, Stage 1-WPIOP
scenario ( from a 2010 Feasibility Study). The project may now move away from a tenement
maintenance/minimum budget position towards project development with new momentum.
Cullen considers its iron ore interest to be a substantial valuable asset.
At Mt Eureka Cullen owns ~40km of strike of ultramafics extending northwards from a new
nickel sulphide discovery at Camelwood-Musket-Cannonball (Rox Resources Limited). The
region is a potential new nickel sulphide province, and we believe that our large project is highly
prospective for nickel sulphides. We will undertake further mapping and sampling programmes
and ground geophysical surveys for target prioritisation, and further drilling is planned.
In addition, Cullen maintains its effort on early stage exploration in greenfield terranes and has
made some new tenement applications in WA. These are in the Dundas and Fraser Range
regions of south east WA for nickel-copper and gold, and in the Gascoyne region of WA for
graphite and gold.
In conclusion, I thank all shareholders for their continued support, and my fellow directors, staff,
consultants and contractors in Perth for their valuable contributions.
Dr. Denis Clarke, Chairman
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Company Profile
Company Profile
Perth-based minerals explorer with:
- iron ore Reserve, West Pilbara
- multi-commodity portfolio via
multiple JV partnerships
- active programmes
- innovative approaches
- motivated management
- experienced board
- project generation in Fraser Range,
Gascoyne and Goldfields Regions of W.A.
Mt Stuart JV
Wyloo JV
Hardey Junction JV
Gascoyne
Paraburdoo JV
Kunderong JV
Gunbarrel
Cue
Amadeus
Fraser Range
Killaloe JV
Perth
Forrestania JV
Minter
Uranium
Gold
Tungsten
Nickel
Iron
Base metals, gold
Graphite
4
Highlights
Highlights
2013/2014
Mt STUART JV, WA
IRON
Mineral Resource Estimate for the Catho Well Channel Iron Deposit (CID)
of 98Mt @ 55.0% Fe, and a Maiden JORC (2004) Reserve Estimate of
70Mt @ 54.8% Fe (Cullen 30%). Baosteel's successful takeover of Aquila
promises new project momentum.
WYLOO JV, WA
IRON
Maiden Inferred Resource in Bedded Iron Deposit (BID) of 16.9Mt @
57.11% Fe (Cullen 49%) further work in 2014/2015 is planned by JV
Manager, Fortescue Metals Group.
MT EUREKA, WA
NICKEL & GOLD
2
~650m project area in North Eastern Goldfields - prospective for gold and
nickel. VTEM and ground EM surveys completed, with drill testing of
conductor plates. Further exploration planned.
LACHLAN , NSW
TUNGSTEN
Diamond drilling completed at Minter in July 2012 tested for cupola-
related, tungsten-bearing vein system. Interpretation of vein orientation
indicates further drilling required to more correctly evaluate.
MURCHISON, WA
GOLD & BASE METALS
Project area ~30km east of Cue, covering the northern part of the
Tuckabianna - Webbs Patch greenstone sequence. Exploration targets for
gold and VMS-style base metal mineralisation in this underexplored area.
Some EM anomalies drilled, others remain untested.
KILLALOE JV
GOLD & COPPER
Targetting nickel sulphide deposits with drill testing of EM conductor
plates. Project area located south side of Lake Cowan along strike from
“Taipan” nickel discovery of Sirius Resources Limited.
NEW PROJECTS
New tenement applications - Gascoyne Region (gold, graphite) and
Fraser Range Region (nickel, copper, gold)
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Exploration Review
ASHBURTON/PILBARA, WA
WEST PILBARA MT STUART JV
The Mt Stuart Iron Ore Joint Venture (MSIOJV) is between Cullen Exploration Pty Ltd - 30%, a wholly-owned
subsidiary of Cullen Resources Limited (Cullen), and API Management Pty Ltd (“API”) - 70%. The shareholders of
API are the parties to the unincorporated joint venture known as the Australian Premium Iron Joint Venture (APIJV).
The participants in the APIJV, are: Aquila Steel Pty Ltd (a subsidiary of Aquila Resources Limited) 50%, and AMCI
(IO) Pty Ltd 50%. Aquila Resources Limited was taken over by Baosteel Resources Australia Pty Ltd (Baosteel) and
Aurizon Operations Limited (Aurizon) in July 2014.
The MSIOJV owns the Catho Well channel iron ore deposit (CID) – one of four starter pits for the proposed West
Pilbara Iron Ore Project - Stage 1 (WPIOP), a 30 Mtpa project to be developed by the APIJV (based upon a 2010
Feasibility Study). Cullen, is contributing funds and maintaining its 30% participating interest in the MSIOJV.
Cullen's ownership of iron ore produced from Catho Well, under one scenario, is ~1.5Mtpa for a 14 year mine life
derived from the Catho Well Ore Reserve of 70Mt @ 54.81% Fe (JORC 2004 compliant) – see Cullen's ASX
announcements of 14 December 2010; and 7 June 2012.
Cullen anticipates new momentum towards a development decision for the proposed West Pilbara Iron Ore Project,
to include mining of Cullen's ore in the Catho Well CID, in the wake of the successful takeover of Aquila Resources
Limited.
Towards the end of the year the KM Native Title Agreement was executed (see CUL:ASX announcement, 12 June
2014); and the execution process for the PKKP Native Title Agreement execution process commenced. Throughout
the year, compliance activities were carried out in respect of mine environmental approval and licence conditions;
and, a programme and budget for FY2014-15 was approved. RC drilling programmes are scheduled to commence
in the September Quarter at the Catho Well deposit and Cardo Bore prospect.
MINERAL RESOURCE ESTIMATE CATHO WELL CHANNEL IRON DEPOSIT: (CULLEN 30%)
Joint
Venture
JORC
Classification
Mt Stuart
JV
Measured
Indicated
Inferred
TOTAL
Mt
2
73
23
98
Fe
%
P
%
SiO2
%
AI O2 3
%
S
%
Mn
%
MgO
%
LOI
%
55.1
0.041
6.61
3.64
0.020
0.058
0.208
9.99
55.1
0.037
6.91
3.16
0.016
54.6
0.037
7.53
3.10
0.015
0.079
0.102
0.178
0.209
10.26
10.40
55.0
0.037
7.05
3.15
0.016
0.084
0.186
10.29
The Catho Well Mineral Resource estimate is reported at a 53% Fe cut-off. The resource estimate has been compiled in
accordance with the guidelines defined in the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves (The JORC Code, 2004 Edition).
Exploration Review
6
MT STUART JOINT VENTURE (MSIOJV) ORE RESERVE ESTIMATE (CULLEN 30%)
Product
Category
Product 1
Proved
Probable
Total
Tonnes
Mt
1
69
70
Fe
%
55.28
54.80
54.81
AI O2 3
%
3.33
3.23
3.23
SiO2
%
6.57
7.23
7.22
P
%
0.043
0.037
0.037
LOI
%
10.03
10.31
10.30
Competent Persons Statement Resource
The information in this announcement that relates to Mineral Resources has been supervised by Mr Stuart Tuckey and Mr Richard
Gaze who are members of the Australian Institute of Mining and Metallurgy. Mr Tuckey is a full-time employee of API Management
Pty Ltd. Mr Gaze is a full time employee of Golder Associates Pty Ltd. Messrs Tuckey and Gaze have sufficient experience which is
relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify
as Competent Persons as defined in the 2004 Edition of the 'Australasian Code of Reporting of Exploration Results, Mineral
Resources and Ore Reserves'. Mr Tuckey and Mr Gaze consent to the inclusion in the report of the matters based on their
information in the form and context in which it appears.
Competent Persons Statement Reserve
The information in this release that relates to Ore Reserves is based on information compiled by Mr Steve Craig, Managing Director
of ORElogy (Mining Consultants). Mr Craig is a Member of the Australasian Institute of Mining and Metallurgy and has sufficient
experience which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is
undertaking, to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves”. Mr Craig consents to the inclusion of the matters based on his information in the
form and context in which it appears in this release.
TUNNEL CREEK JV - URANIUM
The Company has a Joint Venture agreement with Element 92 Pty Ltd, a wholly-owned subsidiary of Thundelarra
Exploration Ltd (Thundelarra), over its two tenements (ELs 52/1890, 1892) at Tunnel Creek/Kunderong, in the
Ashburton Province. In 2011, U3O8 Limited (U3O8) and Thundelarra agreed for U3O8 to farm–in and take over
management of these EL’s in this Cullen/Thundelarra JV. U3O8 and Thundelarra can together earn 70%, with
Cullen to retain 30%, in what is now called the Saltwater Pool JV. In 2012, U3O8 changed its name to Avocet, and
during 2012-2013 merged with Lion One Metals Ltd (ASX: LLO).
HARDEY JUNCTION JV - GOLD
Intrepid Mines Limited sold the Paulsens Gold Mine, located approximately 15km north of the Hardey Junction JV
ground, to Northern Star Resources Ltd in a deal which included sale of their beneficial interest in the Hardey
Junction JV. Cullen holds a 20% Free Carried Interest to decision to mine based on a Bankable Feasibility study in
this Joint Venture. Regional targeting work, which included acquisition of airborne multispectral images and a
University of WA/Centre for Exploration Targeting study, was completed over a large area including the Hardey
Junction JV tenements.
Catho Well - Channel Iron Deposit
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Exploration Review
WYLOO AND PARABURDOO JVs - IRON
The Wyloo JV project lies just south east of the MSIOJV's Catho Well Channel Iron Deposit. Fortescue has
previously provided (see Cullen’s ASX announcement of 21 April, 2012) a maiden Resource Estimate of 16.9 Mt @
57.11% Fe, for the Wyloo South Bedded Iron deposit, classified as Inferred and JORC 2004 Compliant. Fortescue
has earned 51% and may earn 80% by establishing and Indicated Resource and paying Cullen $500,000 and 3c per
tonne of Resource >62% Fe delineated, already or thereafter, up to a maximum of 35Mt and minus the $500,000
already paid. Cullen will then retain 20% FCI to DTM.
During the year, the Joint Venture Manager has reported that earthworks were completed on E47/1154 and
E47/1650 at Wyloo North and E47/1649 at Wyloo South in preparation for a drilling program. This program, and
drilling on E47/1650 and E47/1649, is planned to be undertaken in the September quarter of FY14/15.
Fortescue can earn up to an 80% interest in the iron ore rights on Cullen's E52/1667 (Snowy Mountain), located
~25km south east of Paraburdoo in the Pilbara Region of Western Australia. The tenement includes potential for
bedded iron deposits within the Brockman Iron Formation, along strike from the Paraburdoo and Channar Groups of
iron deposits. Further work is planned to follow up this drilling over the next 2 years.
I n d i a n O c e a n
Port Hedland
API JV's proposed
railway and port
Dampier
Pannawonica
ANKETELL
POINT
Fortescue's
proposed
Western Hub
Marble Bar
Solomon
Mt MacLeod
MT STUART JV
CATHO WELL CID
Tom Price
Hardey
Paraburdoo
Channar
WYLOO JV
Cullen/Fortescue
PARABURDOO JV
Cullen/Fortescue
Cloudbreak
Christmas Creek
Nyudunghu
N
50 kilometres
Newman
Mt Whaleback
Iron ore deposits
Existing railway
Proposed railway (APIJV)
Fortescue iron ore deposit
Existing Fortescue railway
Competent Persons Statement – Wyloo JV - Resource
Mr. Stuart Robinson is a full-time employee of Fortescue Metals Group Ltd and Mr. Mark Glassock has since resigned from the
company. Both people provided geological interpretations for Mineral Resource calculations and compiled the exploration results.
Mr. Robinson, who is a Fellow of The Australian Institute of Mining and Metallurgy, and Mr. Glassock, who is a Member of The
Australian Institute of Mining and Metallurgy have sufficient experience which is relevant to the style of mineralization and type of
deposit under consideration and the activity which they are undertaking to qualify as a Competent Person as defined in the 2004
Edition of the “Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”.
Mr. Robinson and Mr. Glassock consent to the inclusion in this report of the matters based on this information and in the form and
context in which it appears.
Exploration Review
8
NORTH WEST YILGARN, WA
NORTH TUCKABIANNA - GOLD AND BASE METALS
The felsic Eelya Complex hosts the high-grade Hollandaire copper discovery of Silver Lake Resources Ltd (ASX:
SLR – 10 November 2011) as well as several other EM conductor targets, explored by Silver Lake Resources Ltd,
including the Colonel and Mt Eelya prospects .
In April 2012, Cullen completed 7 holes, ~1000m, of scout RC drilling at its North Tuckabianna copper/gold project
which targeted three conductors (NT1-NT3) identified by a helicopter-borne EM survey (VTEM,100-200m line
spacing). The VTEM survey was flown across the Eelya Complex and the northern section of the Tuckabianna
greenstone belt in March 2012. This drilling intersected disseminated sulphide (mainly pyrite and pyrrhotite, 1-20%
visually identified over intervals of 1-20m downhole) in mafic and felsic rocks at or near the modelled conductor
plates from the VTEM survey in all holes drilled.
However, downhole surveys completed at each VTEM anomaly redefined the position of the conductor plates and
showed that the conductive targets had been narrowly missed by the first pass drilling and therefore had not been
adequately tested. These redefined conductor plates were tested in August 2012 with four RC holes (TNRC15-18)
and intersected zones of disseminated sulphide but with only geochemically anomalous assay results (maximum Cu
- 0.20%). Several low-order VTEM anomalies remain to be investigated and tested, initially using A/C and/or RAB
drilling.
EASTERN GOLDFIELDS, WA
KILLALOE JV - GOLD AND NICKEL
Matsa has earned a 70% interest in the Killaloe Project and Cullen has exercised its option to convert its 30%
participating interest into a 20% Free Carried Interest (FCI) to a Decision to Mine. In June 2014, Cullen reported to
the ASX in relation to the exploration activities completed by Matsa Resources Limited (Matsa), the JV Manager.
These announcements described the intersection of narrow zones of semi-massive, and disseminated sulphides in
komatiite at the “Hanging Wall Gossan” nickel prospect (diamond drill-hole 14KLDH01 – see CUL: ASX, 17 June
2014). Down hole surveying of this hole identified two strong off-hole conductors (CUL: ASX, 20 June ASX).
Thereafter, Matsa reported that ground EM surveying and full assessment of all existing exploration data for the
prospect would be undertaken to allow for the design of a follow-up drill programme at the Hanging Wall Gossan
prospect (MAT: ASX, 23 June 2014).
In addition, Cullen suggests there is significant nickel sulphide prospectivity along the western contact of the Eastern
Ultramafic Belt. Cullen interprets this contact is the southern strike extent of the basal contact of ultramafics which
host the Taipan nickel sulphide discovery of Sirius Resources Limited (SIR: ASX announcement of 16 July, 2014) in
their Polar Bear Project.
FORRESTANIA JV
Despite a long campaign of promotion by the Manager, the Joint Venture was unable to attract support from any third
party for further nickel exploration, and no divestment was achieved. Subsequently the Joint Venture agreed to
surrender a number of tenements, but retains the gold rights on M77/544.
9
Exploration Review
NORTH EASTERN GOLDFIELDS, WA
MT EUREKA - GOLD, NICKEL
2
Cullen holds 100% of ~650km of approved tenure in the Mt Eureka Greenstone Belt in the North Eastern
Goldfields of Western Australia which includes multiple targets for nickel sulphides and gold. The high nickel
prospectivity of Cullen's ground is confirmed by the discovery of nickel sulphides by Rox Resources Limited
(Rox) at Camelwood (Fisher East Project) which is located ~3km on strike to the south of Cullen's tenement
boundary (ASX release by Rox, ASX : RXL of 3/10/2013 describes Maiden Resource for Camelwood).
PRIORITY DRILL TARGETS for NICKEL
The Mt Eureka project area includes a wide variety of targets for massive nickel sulphide deposits. Some targets
have been drill-tested by WMC/BHPB Limited in joint venture with Cullen in 2002-2006, generally by 1 or 2 diamond
drill holes. However, several targets have received very limited follow-up, with no ground EM and/or deeper drill
testing. These targets include unresolved down hole EM (DHEM) and/or ground EM anomalies, as well as
geochemical and lithological targets along strike of known mineralisation for further evaluation.
During 2013/2014 Cullen completed various phases of RC drilling to test EM conductors and
geological/geochemical targets for nickel sulphide mineralisation, and a ground EM survey at its Doyles nickel
prospect, located approximately 25km north and along strike of Camelwood, to optimise drilling positions.
The Doyles nickel prospect includes a cluster of “picks” (anomalies), from a 2007 VTEM survey. These anomalies
are broadly coincident with an area of anomalous nickel geochemistry from historical shallow drilling (as reported
previously, Cullen ASX: 23/10/2013). Drilling returned black shales, explaining two main conductors (C1 and C2),
and drilling beneath other low-level nickel anomalies from historical drilling appear to be indicate an enhancement of
nickel values has occurred in the regolith.
The Silverbark North prospect comprises a series of VTEM and ground EM modeled conductors stretching over
1km in Cullen's ground (E1637). Cullen targeted this conductor trend for structurally remobilised nickel sulphide
mineralisation (e.g. Spotted Quoll-type) and for shear-hosted gold and/or VMS base metals. However, in its first
programme of RC drilling EM conductor tested proved to be black shales or sulphidic sediments without nickel.
A further phase of RC drilling (9 holes for 1502m, MERC 126-134, and deepening of MERC121), was completed in
July 2014, testing various EM conductors at the Doyles and Silverbark North nickel sulphide prospects and in the
Western Ultramafics. Geological logging did not indicate any significant Ni sulphide mineralisation associated with
the ultramafics intersected. Of the four EM anomalies tested: two were explained as black shale/pyritic sediments;
two were pyritic-pyrrhotitic-quartz veined structures in basalt and possibly prospective for gold mineralisation. Other
holes tested ultramafics and below anomalous geochemistry in ultramafics, and a magnetic anomaly.
On-going geological mapping and prospecting of nickel sulphide targets at Mt Eureka has underlined the AK47
prospect area, the Central Ultramafics basal contact, and the Silverbark North BIF contacts – both east and west –
as the priorities for further exploration and drill testing.
Exploration Review
10
Wiluna
Mt Keith
Cliffs
Yakabindie
Cosmos
Horse Well
Jundee
P
r
o
t
e
r
o
z
o
i
c
MT EUREKA
MT EUREKA
Mt Fisher
Camelwood
Collurabbie
Mt Mcclure
Bronzewing
Melrose
WONGANOO
Rosie
Moolart
Well
Perserverance
Darlot
Waterloo
Yi l g a r n C r a t o n
( A r c h e a n )
Garden
Well
Mt Windarra
Laverton
N
40 kilometres
Leonora
Granitoid rocks
Greenstone belt
Sediments
Ultramafics
/
Nickel / Gold occurence
and prospects
Road, town
Cullen tenement
MT EUREKA PROJECT - Regional Geological Setting
11
Exploration Review
352,000 mE
356,000 mE
Western
Ultramafics
Central
Ultramafics
Targeting
Basal Contact
BIF
Eastern
Ultramafics
7,042,000 mN
MERC126
7,042,000 mN
MERC103
Silverbark North
MERC128
Silverbark
B
I
F
Nickel Prospect
Downhole surveying
planned
VTEM Anomalies (Cullen)
Priority 1
Priority 2
Priority 3
Basal Contact
7,038,000 mN
7,038,000 mN
MT EUREKA PROJECT
Tenement
Layout
7,036,000 mN
Cullen
Resources
Twinleaf
Emu Bush
Camelwood (ROX)
1.6Mt @ 2.2% Ni
Map
Area
352,000 mE
Cannonball
356,000 mE
MT EUREKA PROJECT - Nickel Prospects over Aeromagnetics
N
2 kilometres
Exploration Review
12
MT EUREKA - SOUTHERN GOLD PROSPECT
Cullen completed one vertical hole to a depth of 234m (MERC110) at the Southern gold prospect, which intersected
a thick (~30m) sulphidic (visually estimated: pyrite, pyrrhotite, arsenopyrite at ~1-10%) zone (ASX announcement of
28 August 2013). Assays from this hole included a best intersection of 8m @ 1.71 g/t Au in 4m composite samples
from 184m, within a 20m thick zone with anomalous arsenic averaging 1360ppm. Cullen also completed a further 5
RC holes on two drill fences 150m apart (MERC111-115). These holes tested the down plunge/dip, deeper portions
of the gold mineralisation in the regolith at Southern, seeking to demonstrate continuity and higher grade.
This drilling confirmed the geological model based on a gas-in-soil anomaly and structural interpretation, which
predicts that gold mineralised structures (low-angle faults/thrusts/shears) strike east-west and dip to the north where
drill-tested to date. Mineralisation was intersected in all five holes drilled and comprises disseminated and semi-
massive pyrite (visually estimated 30-40% over 1m), and arsenopyrite associated with quartz veining. The host
rocks are mafic volcanics, felsic intrusives and meta-sediments, variably affected by alteration and metasomatism.
The intersected quartz-sulphide mineralisation correlates well with previously intersected high-grade gold
mineralisation in the regolith (2m @ 10.0 g/t Au from 50m and 7m @ 9 g/t Au from 116m in MERC 74; and 9m @ 6 g/t
Au from 98m in MERC 75) and shows excellent continuity between individual drill holes and the two drill fences
completed. Cullen has planned diamond drilling to further test this mineralisation.
MT EUREKA - OTHER GOLD TARGETS
The Southern gold prospect was discovered by RAB/air core drilling across a gold-in-lag geochemical anomaly. A
review of the tenor and position of this anomaly on Cullen's aeromagnetic interpretation and regolith maps shows a
major NW-SE alluvial channel lying south of Southern which overlies a number of interpreted intersecting structures.
It is notable that a number of gold-in-lag gold anomalies sit at the margin of this channel and are controlled by
structures, suggesting that other such geochemical anomalies may have been “stripped out”.
The position of Southern and other truncated geochemical anomalies suggests that numerous north and NW-SE
trending shear zones and thrusts mapped beneath the alluvial channel are prime targets for gold. Although there
have been some previous RAB and aircore traverses drilled in the channel, most holes are too shallow and too
widely spaced to have effectively tested this area.
It is notable that the Garden Well gold deposit in the Duketon greenstone belt sits on the margin of a Tertiary
palaeochannel, and that the Bronzewing gold deposit in the Yandal greenstone belt was discovered beneath thick,
transported overburden.
Cullen proposes to prioritise its targets from the multiple structural settings by using its gas-in-soil geochemical
technique, which it believes will indicate sulphide-bearing zones at depth, followed by reconnaissance drilling.
13
CENTRAL LACHLAN FOLD BELT, NSW
MINTER - TUNGSTEN
A combined RC percussion-diamond drilling programme totalling 536.8 metres in three holes was undertaken on the
Minter project in June/July 2012 testing selected geological/geochemical targets at the Doyenwae and Orr Trig
prospects. Holes were designed to test beneath zones of anomalous tungsten and tin geochemistry outlined by
earlier soil sampling and shallow percussion/aircore/RAB drilling.
At the Doyenwae Prospect, RC percussion hole MRC005 averaged 0.045% tungsten over the full 111 metre length
of the hole with localised two-metre zones of quartz-scheelite veining assaying up to 0.35% tungsten. Diamond drill
hole CMDD001, drilled to 258.0 metres at the Doyenwae prospect, intersected significant quartz + sulphide veining
throughout much of the hole. Examination of the core with an ultraviolet lamp detected widespread scheelite
mineralisation occurring both within quartz veins and as disseminations/aggregates in silica-altered sandstone
units; particularly in the interval from 130 metres to the end of the hole. The true width of potential mineralisation in
both MRC005 and CMDD001 is uncertain as preliminary observations of vein orientations in the CMDD001 drill core
indicate that the holes may have been drilled at a low angle to some of the mineralised quartz veins.
At the Orr Trig Prospect, diamond core hole CMDD002; drilled to 267.8 metres, intersected scattered zones of
narrow quartz veining and localised silicification over much of the hole with scheelite being observed as
disseminations in sandstone and within quartz veins in the interval between 100m and 250m. Although it would
appear that hole CMDD002 has been drilled in an appropriate direction with respect to the orientation of the quartz
veins, the amount of observable scheelite mineralisation is less than that noted in CMDD001. The results included:
1m @ 0.7% WO (from 131.45m) and 4.05m @ 0.58% WO from 185m in CMDD001.
3
3
Further drilling is required to test the dominant vein orientation as inferred from a mapping programme completed at
a quarrying site near the Doyenwae prospect. Cullen has been awarded $36,250 (August,2014) from the NSW
government’s New Frontiers Cooperation Drilling Program, to support this planned work.
Exploration Review
14
SCHEDULE OF TENEMENTS (as at 30 June 2014)
REGION
TENEMENTS
APPLICATIONS
CULLEN
INTEREST
COMMENTS
WA: ASHBURTON / PILBARA
Mt Stuart JV
Hardey Junction JV
Wyloo JV
EL08/1135, 1330, 1341,
EL08/1292
EL08/1166, 1189, 1763, P08/546
MLA08/481,
MLA08/482
EL08/1393, EL47/1154, 1649, 1650,
P08/556
MLA47/1490
MLA08/502
Paraburdoo JV
EL52/1667
Tunnel Creek JV
EL52/1890, 1892
EL08/2227
EL08/2145
Mt Edith
Wyloo
WA: NE GOLDFIELDS
Gunbarrel
EL53/1299, 1300 +/ *
EL53/1630, 1635
EL53/1637
EL53/1209
EL53/1611
Irwin Well
Irwin Bore
Wonganoo
WA: SE REGION
Dundas
Fraser Range
E63/1673
E28/2377
E28/2470
EL20/714, E20/808
WA: MURCHISON
Cue
WA: EASTERN GOLDFIELDS
Killaloe
WA: FORRESTANIA
Forrestania JV
M77/544
EL63/1018, 1199, P63/1672, 1331-1333
NEW SOUTH WALES
Minter
EL6572
NORTHERN TERRITORY
Amadeus
E25493, 25494
SWEDEN: Holmajarvi 2; Lavasjakka - Exploration Permits 100% interest
API has earned 70% of iron ore rights
Cullen 100% other mineral rights
Northern Star Resources Limited 80%
FMG has earned 51%, can earn 80%
of iron ore rights
Cullen 100% other mineral rights
FMG can earn up to 80% of iron ore
rights
Cullen 100% other mineral rights
Thundelarra Exploration and Lion One
can earn up to 70%
+2.5% NPI Royalty to Pegasus on
Cullen's interest (parts of E1299);
*1.5% NSR Royalty to Aurora (other
parts of E1299 and parts of 1300)
In ballot - competing applications
Matsa Resources Limited 80%
Hannans Reward Ltd 80%
Gold rights only
30%
20%
49%
100%
100%
100%
100%
100%
100%
100%
100%
0%
0%
0%
100%
20%
20%
100%
0%
15
Exploration Review
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P
Exploration Review
16
MINERAL RESOURCES and ORE RESERVES (MROR) statement
The company’s annual review of mineral resources and ore reserves is given below. There has been no change in
the entity’s Mineral Resources and Ore Reserves since last reported to June 30, 2013.
MINERAL RESOURCE ESTIMATE CATHO WELL CHANNEL IRON DEPOSIT: (CULLEN 30%)
Joint
Venture
JORC
Classification
Mt Stuart
JV
Measured
Indicated
Inferred
TOTAL
Mt
2
73
23
98
Fe
%
P
%
SiO2
%
AI O2 3
%
S
%
Mn
%
MgO
%
LOI
%
55.1
0.041
6.61
3.64
0.020
0.058
0.208
9.99
55.1
0.037
6.91
3.16
54.6
0.037
7.53
3.10
0.016
0.015
0.079
0.102
0.178
0.209
10.26
10.40
55.0
0.037
7.05
3.15
0.016
0.084
0.186
10.29
The Catho Well Mineral Resource estimate is reported at a 53% Fe cut-off. The resource estimate has been compiled in
accordance with the guidelines defined in the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves (The JORC Code, 2004 Edition).
MT STUART JOINT VENTURE (MSIOJV) ORE RESERVE ESTIMATE (CULLEN 30%)
Product
Category
Product 1
Proved
Probable
Total
Tonnes
Mt
1
69
70
Fe %
55.28
54.80
54.81
AI O2 3
%
3.33
3.23
3.23
SiO2
%
6.57
7.23
7.22
P
%
0.043
0.037
0.037
LOI
%
10.03
10.31
10.30
Competent Persons Statement Resource
The information in this announcement that relates to Mineral Resources has been supervised by Mr Stuart Tuckey and Mr Richard
Gaze who are members of the Australian Institute of Mining and Metallurgy. Mr Tuckey is a full-time employee of API Management
Pty Ltd. Mr Gaze is a full time employee of Golder Associates Pty Ltd. Messrs Tuckey and Gaze have sufficient experience which is
relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify
as Competent Persons as defined in the 2004 Edition of the 'Australasian Code of Reporting of Exploration Results, Mineral
Resources and Ore Reserves'. Mr Tuckey and Mr Gaze consent to the inclusion in the report of the matters based on their
information in the form and context in which it appears.
Competent Persons Statement Reserve
The information in this release that relates to Ore Reserves is based on information compiled by Mr Steve Craig, Managing Director
of ORElogy (Mining Consultants). Mr Craig is a Member of the Australasian Institute of Mining and Metallurgy and has sufficient
experience which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is
undertaking, to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves”. Mr Craig consents to the inclusion of the matters based on his information in the
form and context in which it appears in this release.
WYLOO SOUTH INFERRED RESOURCE (CULLEN 49%)
Category
Inferred
Tonnes
Mt
16.9
Fe
%
57.11
AI O2 3
%
3.55
SiO2
%
7.91
P
%
0.102
LOI
%
6.12
Competent Persons Statement – Wyloo JV - Resource
Mr. Stuart Robinson is a full-time employee of Fortescue Metals Group Ltd and Mr. Mark Glassock has since resigned from the
company. Both people provided geological interpretations for Mineral Resource calculations and compiled the exploration results.
Mr. Robinson, who is a Fellow of The Australian Institute of Mining and Metallurgy, and Mr. Glassock, who is a Member of The
Australian Institute of Mining and Metallurgy have sufficient experience which is relevant to the style of mineralization and type of
deposit under consideration and the activity which they are undertaking to qualify as a Competent Person as defined in the 2004
Edition of the “Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr. Robinson and Mr.
Glassock consent to the inclusion in this report of the matters based on this information and in the form and context in which it
appears.
Competent Person Statements
The information in this report that relates to Exploration Results is based on information compiled by Dr Chris Ringrose, Managing
Director, Cullen Resources Limited (Cullen), and previously released to the ASX via Cullen's various Announcements including
Quarterly Reports. Dr. Ringrose is a full-time employee of Cullen Resources Limited and a Member of the Australasian Institute of
Mining and Metallurgy. He has sufficient experience which is relevant to the style of mineralisation and types of deposits under
consideration, and to the activity which has been undertaken, to qualify as a Competent Person as defined by the 2012 edition of the
“Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Dr. Ringrose consents to the
report being issued in the form and context in which it appears. The information in this report may also include review and
interpretation of historical and previous exploration by Cullen, firstly prepared and disclosed under the JORC Code 2004. It has not
been updated since to comply with the JORC Code2012 on the basis that the information has not changed materially since it was last
reported. The Company confirms that it is not aware of any new information or data which materially affects the information included
in this report.
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
DIRECTORS' REPORT
Your Directors submit their report for the year ended 30 June 2014.
Directors
The names and details of the company’s directors in office during the financial year and until the date of this
report are as follows. Directors were in office for this entire period unless otherwise stated.
Dr Denis Clarke BSc, BA, PhD, FAIMM (Non‐Executive Chairman) (Appointed 1 April 1999)
•
Dr Denis Clarke has more than 40 years’ experience in exploration and mining operations. Over 15 years with
Plutonic Resources (“Plutonic”), he contributed significantly at the General Manager level to its success as it
developed from a small explorer in 1983 to one of Australia’s largest gold miners prior to its take‐over in 1998 in
a transaction which valued Plutonic at $1 billion. Dr Clarke at various times managed the exploration, finance,
administration and corporate divisions. He subsequently was a director and consultant to Troy Resources
Limited for eleven years as it developed from explorer to a successful international gold miner. During the past
three years Dr Clarke has been Chairman or Non‐Executive Director of the following listed companies:
‐
LionGold Corp Ltd (from 1 October 2012 to present)
‐ Hill End Gold Limited (from 25 February 2010 to present)
‐
‐
Signature Metals Limited (from 14 September 2012 to present)
Anglo Australian Resources NL (from 9 April 2004 to 28 November 2011)
•
Dr Chris Ringrose BSc, PhD, MBA, MAIMM, MAICD (Managing Director) (Appointed 19 June 2003)
Dr Chris Ringrose has been an exploration geologist based mainly in Western Australia since he completed his
geology degrees in Scotland in 1982. His career has included experience with EZ, Chevron and Aztec, and prior to
joining Cullen, he was Exploration Manager with Troy Resources Limited for nine years. Dr Ringrose has also
completed an MBA at Deakin University and brings to the Company significant management, exploration and
project evaluation experience gained both in Australia and overseas. Dr Ringrose has had no other directorships
of listed companies in the last three years.
Grahame Hamilton BSc, MSc, MAIG (Non‐Executive Director) (Appointed 1 April 1999)
•
Mr Grahame Hamilton, a graduate of the University of NSW, has extensive experience over 40 years in
exploration, corporate and project management. He has wide ranging expertise in project evaluation. Between
1994 and 1996 he managed the Brocks Creek exploration, environmental impact statement, feasibility study,
mine development and construction for Solomon Pacific Resources NL. Before Solomon, Mr Hamilton worked
with Getty Oil Development Co. ‐ Minerals Division as Queensland Manager.
John Horsburgh BSc, MSc, FAIMM (Non‐Executive Director) (Appointed 1 April 1999)
•
Mr John Horsburgh, a graduate of the Royal School of Mines, has over 40 years industry experience including 11
years with Solomon Pacific Resources NL. Prior to this he gained extensive experience in Australia and overseas
with Getty Oil Development Co., Billiton and RTZ Group. Mr Horsburgh is Non‐Executive Chairman of AIM‐listed
public company Mariana Resources Limited.
‐ 17 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
•
Wayne John Kernaghan BBus, ACA, FAICD, ACIS (Non‐Executive Director and Company Secretary)
(Appointed 11 November 1997)
Mr Wayne Kernaghan is a member of the Institute of Chartered Accountants in Australia with a number of years
experience in various areas of the mining industry. He is also a Fellow of the Australian Institute of Company
Directors. During the past three years Mr Kernaghan has held, and is currently a director and holds, the following
listed company directorships:
‐
‐
Gulf Industrials Limited (from 30 June 2005 to present)
South American Ferro Metals Limited (from 26 June 2013 to present)
Principal Activities
The principal activity for the Consolidated Entity comprising Cullen Resources Limited ("the Company") and its
controlled entities (together "the Consolidated Entity") during the course of the financial year was mineral
exploration. There was no significant change in the nature of the Consolidated Entity's activities during the year.
Results
The loss attributable to the Consolidated Entity for the financial year was $1,880,593 [2013: loss $2,078,566]. No
income tax was attributable to this result [2013: Nil].
Dividends
The directors do not recommend the payment of a dividend for this financial year. No dividend has been
declared or paid by the Company since the end of the previous financial year.
Significant Changes in the State of Affairs
In the opinion of the directors there were no significant changes in the state of affairs of the Consolidated Entity
that occurred during the financial year under review not otherwise disclosed in this report or the consolidated
financial statements.
Review of Operations
Cullen is a mineral exploration company seeking deposits of gold, nickel, copper, uranium and iron ore either in
its own right, or managed by other partners in Joint Ventures.
During the year under review, the Company continued its mineral exploration activities including: project
generation, database reviews, field mapping, geochemical surveying, and drilling programmes. Company
exploration activities, including Joint Venture managed projects, were focused in Western Australia with
additional activities in New South Wales as follows:
Ashburton Province, WA (Hardey Junction JV, Mt Stuart JV, Wyloo JV, Paraburdoo JV and Tunnel Creek
/Saltwater Pool JV ‐ gold, uranium and /or iron ore projects)
North Eastern Goldfields, WA (Gunbarrel/Mt Eureka and Irwin Bore, gold and nickel projects)
Eastern Goldfields, WA (Killaloe, gold and nickel project)
Murchison,WA (North Tuckabianna , copper and gold project)
Forrestania, WA (Forrestania JV, gold and nickel project)
Central Lachlan Fold Belt, NSW (Minter tungsten project)
Drilling by Cullen during the year to 30 June 2014 focussed on programmes for nickel sulphide and gold deposits
in the Mt Eureka project area, and for iron ore in the Wyloo JV. Other exploration field work has included: field
reconnaissance, geological mapping, geochemical and geophysical surveys in the Mt Eureka project, and
evaluations of new project opportunities and project generation. The Company continued to market projects as
potential farm‐out opportunities.
During the year the Company ceased exploration activities overseas in response to its tight capital position.
Cullen withdrew from Namibia and Scandinavia, and terminated the TL property JV in Canada.
‐ 18 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
A total of $ 1,530,372 (2013: $1,912,358) was spent on exploration by Cullen during the year, with Joint Venture
Partners contributing further exploration funds on Cullen tenements.
Cullen will continue to identify and evaluate both advanced and "grass roots" opportunities throughout Australia
and in selected overseas locations. Cullen’s portfolio is under continual evaluation to focus on projects likely to
result in discovery of an economic mineral deposit.
Corporate
At 30 June 2014 available cash totalled $ 1,073,739 (2013: $1,884,038).
After Balance Date Events
There has not arisen in the interval between the end of the financial year and the date of this report any item,
transaction or event of a material and unusual nature likely, in the opinion of the directors, to affect the
operations of the Consolidated Entity, the results of those operations or the state of affairs of the Consolidated
Entity in the subsequent financial years.
Likely Developments and Future Results
Other than as referred to in this report, further information as to likely developments in the operations of the
Consolidated Entity and the expected results of those operations would, in the opinion of the directors, be
speculative and not in the best interests of the Consolidated Entity.
Environmental Regulation
The exploration activities of the Consolidated Entity in Australia are subject to environmental regulation under
the laws of the Commonwealth and the States in which those exploration activities are conducted. The
environmental laws and regulations generally address the potential impact of the Consolidated Entity's activities
in the areas of water and air quality, noise, surface disturbance and the impact upon flora and fauna. The
directors are not aware of any environmental matter which would have a materially adverse impact on the
overall business of the Consolidated Entity.
Options
As at the date of this report the Company has 6,000,000 (2013: 22,000,000) options which were outstanding.
During the year 6,000,000 (2013: Nil) options were issued and 22,000,000 (2013: Nil) options expired. Refer to
Note 11 of the financial statements for further details of the options outstanding.
During the year no fully paid ordinary shares were issued by virtue of the exercise of options (2013: Nil). Since
the end of the financial year no shares have been issued by virtue of the exercise of options (2013: Nil).
Directors’ Interest
At the date of this report, the interest of the directors in the shares and options of the company were:
2014
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Direct
Fully Paid Shares
‐
3,450,000
‐
2
2,000,000
Options
‐
‐
‐
‐
‐
Indirect
Fully Paid Shares
7,864,000
‐
18,391,004
19,952,122
4,873,376
Options
‐
‐
‐
‐
‐
‐ 19 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Directors' Meetings
During the year the Company held eight meetings of directors. The attendance of the directors at meetings of
the Board were:
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Board of Directors
Attended
8
8
8
8
8
Maximum possible
eligible to attend
8
8
8
8
8
Indemnification and insurance of Directors and Officers
The Company has entered into deeds of indemnity with the Directors indemnifying them against certain
liabilities and costs to the extent permitted by law. The Company has paid premiums totalling $10,448 (2013:
$19,995) in respect of Directors and Officers Liability Insurance and Company reimbursement policies, which
covers all Directors and Officers of the Company. The policy conditions preclude the Company from any detailed
disclosures.
Indemnification of Auditors
To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the
terms of its audit engagement agreement against claims by third parties arising from the audit (for an
unspecified amount). No payment has been made to indemnify Ernst & Young during or since the financial year.
Employees
The Consolidated Entity employed two employees as at 30 June 2014 (2013: 3).
Corporate Governance
In recognising the need for the highest standard of corporate behaviour and accountability, the directors of
Cullen Resources Limited support and have adhered to the principles of good corporate governance. The
Company’s corporate governance statement is on page 27.
Auditor Independence
The directors have received the auditor’s independence declaration for the year ended 30 June 2014 which is on
page 26 and forms part of this directors’ report. For the year Ernst & Young have provided non‐audit services to
the Consolidated Entity in the amount of $8,353(2013: $2,000).
The directors are satisfied that non‐audit services are compatible with the independence requirements of the
Corporations Act 2001. The nature and scope of the non‐audit services provided has meant that auditor
independence was not compromised.
‐ 20 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
REMUNERATION REPORT (AUDITED)
This report details the nature and amount of remuneration for each director of Cullen Resources Limited.
This remuneration report outlines the director and executive remuneration arrangements of the Consolidated
Entity in accordance with the requirements of the Corporations Act 2001 and its Regulations. For the purposes of
this report, key management personnel (KMP) of the Consolidated Entity are defined as those persons having
authority and responsibility for planning, directing and controlling the major activities of the Consolidated Entity,
directly or indirectly, including any director (whether executive or otherwise) of the parent company. Only
directors of the Consolidated Entity meet the definition of key management personnel as the executive role is
performed by the executive director.
Details of key management personnel:
Directors
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Chairman (Non‐Executive)
Managing Director
Director (Non‐Executive)
Director (Non‐Executive)
Director (Non‐Executive)
Remuneration Policy
The remuneration policy of Cullen Resources Limited has been designed to align director objectives with
shareholder and business objectives by providing a fixed remuneration component and offering specific long‐
term incentives. The board of Cullen Resources 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 Company as
well as create goal congruence between directors and shareholders.
The Board’s policy for determining the nature and amount of remuneration for Board members is as follows.
The remuneration policy, setting the terms and conditions for the executive director was developed by the
Board. The executive receives a base salary on factors such as length of service and experience, superannuation,
options and incentives. The Board reviews executive packages annually by reference to executive performance
and comparable information from industry sectors and other listed companies in similar industries.
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. Fees for non‐executive directors are not
linked to either long term or short term performance of the Consolidated Entity. However, to align directors’
interest with shareholder interests, the directors are encouraged to hold shares in the Company. There is a
specified aggregate directors fees of $250,000 for non‐executive directors which was approved by shareholders
at a general meeting of the Company. The $250,000 excludes other services outside of non‐executive directors'
fees.
Remuneration Incentives
Director and executive remuneration is currently not linked to either long term or short term performance
conditions. The Board feels that the expiry date and exercise price of options when issued to the directors and
executives are sufficient to align the goals of the directors and executives with those of the shareholders to
maximise shareholder wealth, and as such, has not set any performance conditions for the directors or the
executives of the Company. The Board will continue to monitor this policy to ensure that it is appropriate for the
Company in future years.
‐ 21 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Group performance and shareholder wealth
Below is a table summarising key performance and shareholder wealth statistics for the Consolidated Entity over
the last five years.
Financial Year
30 June 2010
30 June 2011
30 June 2012
30 June 2013
30 June 2014
Loss After Tax
$
2,161,235
1,640,087
2,649,846
2,078,566
1,880,593
EPS
Cents
(0.39)
(0.27)
(0.41)
(0.28)
(0.21)
Share Price
Cents
3.4
3.0
1.8
0.8
1.7
Employment Contract ‐ Managing Director
Pursuant to an agreement Dr Ringrose will provide managing director services to the Company. The term of this
arrangement is from 1 November 2006 and will continue thereafter unless terminated on not less than three
months' notice given at any time. Effective from 1 April 2011 Dr Ringrose’s salary is $265,000pa. The position of
the director will become redundant under this agreement in the limited circumstances where the employment
of the Managing Director is terminated as a result of a takeover or merger of the Company. The Company will
pay the Managing Director the equivalent of four weeks per year of service or part thereof of his base salary as a
redundancy payment.
As part of Dr Ringrose's employment package he was issued with 8,000,000 options on 1 December 2010 with
the following terms. The options will expire on the earlier of the date which is one month after the Director to
whom the options are issued ceases to be a Director of the Company (or such longer period as determined by
the Board of Directors) or at 5.00 pm on 30 November 2013 ("the Expiry Date") with an exercise price of $0.075.
This is contained in the notice of meeting which was approved by shareholders. These options expired during the
year.
During the year the Board paid a discretionary bonus of Nil (2013: Nil) to Dr Ringrose. This bonus was
discretionary therefore there were no performance conditions attached to this bonus.
Non Executive Directors
The non executive directors have been issued with two million options each on 1 December 2010 with an
exercise price of $0.075 each. The options will expire on the earlier of the date which is one month after the
Director to whom the options are issued ceases to be a Director of the Company (or such longer period as
determined by the Board of Directors) or at 5.00 pm on 30 November 2013 ("the Expiry Date"). This is contained
in the notice of meeting which was approved by shareholders. These options expired during the year.
Directors’ and Executives’ Remuneration
Details of remuneration provided to directors for the year ended 30 June 2014 are as follows:
Directors
Short Term
Director
Fees
$
35,000
Salary/
Consulting
$
Bonus
$
‐
‐
265,000
30,000
30,000
‐
‐
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
30,000
Total
125,000
37,750
302,750
Post
Employ‐
ment
Super‐
annuation
$
3,237
Long
Term
Long
Service
Leave
$
‐
Share
Based
Payments
Options
$
‐
Non
Monetary
Benefits
$
‐
* 6,836
24,512
4,988
‐
‐
‐
2,775
2,775
2,775
‐
‐
‐
6,836
36,074
4,988
‐
‐
‐
‐
‐
Perfor‐
mance
Related
%
‐
‐
‐
‐
‐
‐
Total
$
38,237
301,336
32,775
32,775
70,525
475,648
‐
‐
‐
‐
‐
‐
* This relates to the provision of a motor vehicle.
‐ 22 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
The Company has no policy on directors and executives entering into contracts to hedge their exposure to
options or shares granted as part of their remuneration package.
Details of remuneration provided to directors for the year ended 30 June 2013 are as follows:
Directors
Short Term
Director
Fees
$
35,000
Salary/
Consulting
$
‐
‐
265,000
30,000
30,000
30,000
14,850
‐
38,125
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Total
125,000
317,975
Bonus
$
‐
‐
‐
‐
‐
‐
* This relates to the provision of a motor vehicle.
Post
Employ‐
ment
Super‐
annuation
$
Long
Term
Long
Service
Leave
$
Non
Monetary
Benefits
$
‐
3,150
‐
* 6,836
23,850
(18,500)
‐
‐
‐
2,700
2,700
2,700
‐
‐
‐
6,836
35,100
(18,500)
Share
Based
Payments
Options
$
‐
‐
‐
‐
‐
‐
Perfor‐
mance
Related
%
‐
‐
‐
‐
‐
‐
Total
$
38,150
277,186
47,550
32,700
70,825
466,411
Options granted as part of remuneration for the year ended 30 June 2014
There were nil (2013: nil) options granted as part of director emoluments during the year.
Shares issued on exercise of remunerated options
During the financial year nil (2013: Nil) remunerated options were exercised. During the financial year 16,000,000
(2013: nil) options expired. The directors exercised nil (2013: Nil) options during the year.
Directors
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Value of options
granted during the
year
$
‐
‐
‐
‐
‐
Value of options
exercised during the
year
$
‐
‐
‐
‐
‐
Value of options
expired during the year
$
(55,400)
(221,600)
(55,400)
(55,400)
(55,400)
Total value of options
granted, exercised and
expired during the year
$
(55,400)
(221,600)
(55,400)
(55,400)
(55,400)
There were no options granted as a part of remuneration for the year ended 30 June 2014.
Options granted as part of remuneration for the year ended 30 June 2013
Directors
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Value of options
granted during the
year
$
‐
‐
‐
‐
‐
Value of options
exercised during the
year
$
‐
‐
‐
‐
‐
Value of options
expired during the year
$
‐
‐
‐
‐
‐
Total value of options
granted, exercised and
expired during the year
$
‐
‐
‐
‐
‐
There were no options granted as a part of remuneration for the year ended 30 June 2013.
‐ 23 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Option holdings of directors
Balance at
beginning of
year 1 July 2013
Number
Options
issued
Number
Options
lapsed
Number
Balance at end
of year
30 June 2014
Number
Total
Number
Vested and
exercisable at
30 June 2014
Number
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
‐
‐
‐
‐
‐
(2,000,000)
(8,000,000)
(2,000,000)
(2,000,000)
(2,000,000)
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
The outstanding options were exercisable at $0.075 and had an expiry date of 30 November 2013.
These options have expired.
(16,000,000)
16,000,000
‐
‐
‐
‐
‐
‐
‐
‐
Balance at
beginning of
year
1 July 2012
Number
Options
issued
Number
Options
lapsed
Number
Balance at end
of year
30 June 2013
Number
Total
Number
Vested and
exercisable at
30 June 2013
Number
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
The outstanding options are exercisable at $0.075 and have an expiry date of 30 November 2013.
These options had a weighted average exercise price of $0.075 and a weighted average remaining contractual
life of 0.42 years.
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
Shareholdings of directors
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
Balance
1 July 2013
Number
5,364,000
950,000
15,891,004
17,452,124
4,373,376
44,030,504
Balance
1 July 2012
Number
4,614,000
200,000
15,141,004
16,702,124
3,623,376
40,280,504
Options
Exercised
Number
‐
‐
‐
‐
‐
‐
Options
Exercised
Number
‐
‐
‐
‐
‐
‐
Net Change
Purchase
Number
2,500,000
2,500,000
2,500,000
2,500,000
2,500,000
12,500,000
Net Change
Purchase
Number
750,000
750,000
750,000
750,000
750,000
3,750,000
Balance
30 June 2014
Number
7,864,000
3,450,000
18,391,004
19,952,124
6,873,376
56,530,504
Balance
30 June 2013
Number
5,364,000
950,000
15,891,004
17,452,124
4,373,376
44,030,504
The directors' shareholdings are held directly and indirectly.
End of Remuneration Report
‐ 24 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Signed in accordance with a resolution of the directors
C. Ringrose
Director
Perth, WA
5 September 2014
‐ 25 ‐
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s Independence Declaration to the Directors of Cullen Resources
Limited
In relation to our audit of the financial report of Cullen Resources Limited for the financial year ended 30
June 2014, to the best of my knowledge and belief, there have been no contraventions of the auditor
independence requirements of the Corporations Act 2001 or any applicable code of professional conduct.
Ernst & Young
Peter McIver
Partner
5 September 2014
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PM:EH:CULLEN:025
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
CORPORATE GOVERNANCE STATEMENT
In recognising the need for the highest standards of corporate behaviour and accountability, the directors of
Cullen Resources Limited have adhered to the principles of corporate governance and this statement outlines
the main corporate governance practices in place throughout the financial year. The ASX Corporate Governance
Council released revised Corporate Governance Principles and Recommendations on 2 August 2007. Having
regard to the size of the Company and the nature of its enterprise, it is considered that the Company complies
as far as possible with the spirit and intentions of the ASX Corporate Governance Council's Corporate
Governance Principles and Recommendations. Unless otherwise stated, the practices were in place for the
entire year.
Board of Directors
The Board of Directors of the Company is responsible for the corporate governance of the Company. The Board
guides and monitors the business and affairs of the Company on behalf of the shareholders by whom they are
elected and to whom they are accountable.
As the Board acts on behalf of shareholders, it seeks to identify the expectations of shareholders, as well as
other ethical expectations and obligations. In addition, the Board is responsible for identifying areas of
significant business risk and ensuing arrangements are in place to adequately manage those risks.
The primary responsibility of the Board includes:
formulation and approval of the strategic direction, objectives and goals of the Company;
monitoring the financial performance of the Company, including approval of the Company’s financial
statements;
ensuring that adequate internal control systems and procedures exists and that compliance with these
systems and procedures is maintained;
the identification of significant business risks and ensuring that such risks are adequately managed;
the review of performance and remuneration of executive directors; and
the establishment and maintenance of appropriate ethical standards.
The responsibility for the operation and administration of the Company is carried out by the directors, who
operate in an executive capacity, supported by senior professional staff. The Board ensures that this team is
suitably qualified and experienced to discharge their responsibilities, and assesses on an ongoing basis the
performance of the management team, to ensure that management’s objectives and activities are aligned with
the expectations and risks identified by the Board.
The Directors of the Company are as follows:
Dr Denis Clarke
Dr Chris Ringrose
Grahame Hamilton
John Horsburgh
Wayne Kernaghan
For information in respect to each director refer to the Directors' Report.
‐ 27 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Independent Directors
Under ASX guidelines, principle 2.1, two of the current Board of five directors are considered to be independent
directors. Dr Ringrose is the executive director and Mr Horsburgh and Mr Hamilton, who are former executive
directors, are, under the ASX guidelines deemed not to be independent by virtue of their positions or former
positions. The Board is satisfied that the structure of the Board is appropriate for the size of the Company and
the nature of its operations and is a cost effective structure for managing the Company.
Board Composition
When the need for a new director is identified, selection is based on the skills and experience of prospective
directors, having regard to the present and future needs of the Company. Any director so appointed must then
stand for election at the next Annual General Meeting of the Company.
Terms of Appointment as a Director
The constitution of the Company provides that a Director, other than the Managing Director, may not retain
office for more than three calendar years or beyond the third annual general meeting following his or her
election, whichever is longer, without submitting for re‐election. One third of the Directors must retire each
year and are eligible for re‐election. The Directors who retire by rotation at each annual general meeting are
those with the longest length of time in office since their appointment or last election.
Board Committees
In view of the size of the Company and the nature of its activities, the Board has considered that establishing
formally constituted committees for audit, board nominations and remuneration would contribute little to its
effective management. Accordingly audit matters, the nomination of new Directors and the setting, or review,
of remuneration levels of Directors and senior executives are reviewed by the Board as a whole and approved
by resolution of the Board (with abstentions from relevant Directors where there is a conflict of interest).
Where the Board considers that particular expertise or information is required, which is not available from
within their number, appropriate external advice may be taken and reviewed prior to a final decision being
made by the Board.
Remuneration
Remuneration and other terms of employment of executives, including executive directors, are reviewed
periodically by the Board having regard to performance, relevant comparative information and, where
necessary, independent expert advice. Remuneration packages are set at levels that are intended to attract and
retain executives capable of managing the Company’s operations.
The terms of engagement and remuneration of executive directors is reviewed periodically by the Board, with
recommendations being made by the non‐executive directors. Where the remuneration of a particular
executive director is to be considered, the director concerned does not participate in the discussion or decision
making.
Make Timely and Balanced Disclosure
The board has in place written policies and procedures to ensure the Company complies with its obligations
under the continuous disclosure rule 3.1 and other ASX Listing Rule disclosure requirements.
Independent Professional Advice
Directors have the right, in connection with their duties and responsibilities as directors, to seek independent
professional advice at the Company’s expense. Prior approval of the Chairman is required, which will not be
unreasonably withheld.
‐ 28 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Code of Conduct
In view of the size of the Company and the nature of its activities, the Board has considered that an informal
code of conduct is appropriate to guide executives, management and employees in carrying out their duties and
responsibilities.
Diversity Policy
The Company is in the process of establishing a diversity policy.
As at 30 June 2014, 0 % (2013: 33.3%) of the workforce is female with no females at board or senior
management level. There are only two employees who are both male.
Communication to Market & Shareholders
The Board of Directors aims to ensure that the shareholders, on behalf of whom they act, are informed of all
information necessary to assess the performance of the directors and the Company. Information is
communicated to shareholders and the market through:
the Annual Report which is available to all shareholders;
other periodic reports which are lodged with ASX and available for shareholder scrutiny;
other announcements made in accordance with ASX Listing Rules;
special purpose information memoranda issued to shareholders as appropriate;
the Annual General Meeting and other meetings called to obtain approval for board action as appropriate;
and,
The Company's website.
Share Trading
Dealings are not permitted at any time whilst in the possession of price sensitive information not already
available to the market. In addition, the Corporations Act 2001 prohibits the purchase or sale of securities whilst
a person is in possession of inside information.
External Auditors
The external auditor is Ernst and Young. The external auditors are invited to attend the annual general meeting
and be available to answer shareholder questions about the conduct of the audit and the preparation and
content of the auditor's report.
Full details of the company’s corporate governance practices can be viewed at its website
www.cullenresources.com.au.
‐ 29 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Consolidated Statement of Financial Position
as at 30 June 2014
Current Assets
Cash and cash equivalents
Receivables
Total Current Assets
Non Current Assets
Other financial assets
Plant & Equipment
Exploration & Evaluation
Total Non Current Assets
Total Assets
Current Liabilities
Trade and other payables
Provisions
Total Current Liabilities
Non Current Liabilities
Provisions
Total Non Current Liabilities
Total Liabilities
Net Assets
Equity
Issued Capital
Share based payment reserve
Accumulated Losses
Total Equity
Note
21(i)
5
6
7
8
9
10
10
11
12
13
Consolidated
2014
$
1,073,739
89,020
1,162,759
12,400
963
4,483,886
4,497,249
5,660,008
145,939
121,829
267,768
‐
‐
267,768
2013
$
1,884,038
38,286
1,922,324
32,400
3,172
4,211,622
4,247,194
6,169,518
108,266
103,917
212,183
26,602
26,602
238,785
5,392,240
5,930,733
40,521,766
1,301,725
(36,431,251)
5,392,240
39,201,266
1,280,125
(34,550,658)
5,930,733
These financial statements should be read in conjunction with the accompanying notes.
‐ 30 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Consolidated Statement of Changes in Equity
for the year ended 30 June 2014
Note
Issued
Capital
$
Share Based
Payment
Reserve
$
Available for
Sale
Reserve
$
Accumulated
Losses
$
Total
Equity
$
At 1 July 2012
36,605,266
1,280,125
Loss for the year
Other comprehensive income
Total comprehensive
income/(expense) for the year
Issue of share capital
Share issue costs
‐
‐
‐
2,706,000
(110,000)
Share based payments
12
‐
‐
‐
‐
‐
‐
‐
At 30 June 2013
39,201,266
1,280,125
‐
‐
‐
‐
‐
‐
‐
‐
(32,472,092)
5,413,299
(2,078,566)
(2,078,566)
‐
‐
(2,078,566)
(2,078,566)
‐
‐
‐
2,706,000
(110,000)
‐
(34,550,658)
5,930,733
Note
Issued
Capital
$
Share Based
Payment
Reserve
$
Available for
Sale
Reserve
$
Accumulated
Losses
$
Total
Equity
$
At 1 July 2013
39,201,266
1,280,125
Loss for the year
Other comprehensive income
Total comprehensive
income/(expense) for the year
‐
‐
‐
Issue of share capital
1,320,500
Share issue costs
Share based payments
12
‐
‐
‐
‐
‐
‐
‐
21,600
At 30 June 2014
40,521,766
1,301,725
‐
‐
‐
‐
‐
‐
‐
‐
(34,550,658)
5,930,733
(1,880,593)
(1,880,593)
‐
‐
(1,880,593)
(1,880,593)
‐
‐
‐
1,320,500
‐
21,600
(36,431,251)
5,392,240
These financial statements should be read in conjunction with the accompanying notes.
‐ 31 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2014
Revenues
Rent
Salaries and Consultants' fees
Compliance expenses
Impairment of exploration expenditure
Share based payments
Depreciation
Other expenses
Loss before income tax
Income tax
Net Loss attributable to members of
Cullen Resources Limited after tax
Other Comprehensive Income:
Total comprehensive income/(loss)
for the period
Basic (loss) per share
(cents per share)
Diluted (loss) per share
(cents per share)
Note
3
8
12
4
22
22
Consolidated
2014
$
2013
$
116,211
205,899
(41,966)
(387,822)
(147,392)
(1,258,108)
(21,600)
(2,209)
(137,707)
(42,810)
(408,234)
(179,679)
(1,452,694)
‐
(5,421)
(195,627)
(1,880,593)
(2,078,566)
‐
‐
(1,880,593)
(2,078,566)
‐
‐
(1,880,593)
(2,078,566)
(0.21)
(0.23)
(0.21)
(0.23)
These financial statements should be read in conjunction with the accompanying notes.
‐ 32 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Consolidated Statement of Cash Flows
for the year ended 30 June 2014
Note
Consolidated
2014
$
2013
$
Cash flows from operating activities
Research and development grant
Cash payments in the course of operations
GST refunded
Interest received
83,527
(841,845)
108,668
29,223
156,191
(1,597,202)
144,305
40,481
Net operating cash flows
21(ii)
(620,427)
(1,256,225)
Cash flows from investing activities
Refund of security deposits
Payment for plant & equipment
Payments for exploration & evaluation
Net investing cash flows
Cash flows from financing activities
Proceeds from issue of shares
Share issue costs
Net financing cash flows
Net increase/(decrease) in cash
and cash equivalents
Cash and cash equivalents at the
beginning of the financial year
Cash and cash equivalents at the end
of the financial year
20,000
‐
(1,530,372)
‐
(2,619)
(1,912,358)
(1,510,372)
(1,914,977)
1,320,500
‐
2,706,000
(110,000)
1,320,500
2,596,000
(810,299)
(575,202)
1,884,038
2,459,240
21(i)
1,073,739
1,884,038
These financial statements should be read in conjunction with the accompanying notes.
‐ 33 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Notes to the Financial Statements
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
(a)
The financial statements are general purpose financial statements, which have been prepared in accordance with the requirements
of the Corporations Act 2001, and Australian Accounting Standards. The financial statements have also been prepared in
accordance with the historical cost convention using the accounting policies described below and do not take account of changes in
either the general purchasing power of the dollar or in prices of specific assets.
Statement of compliance
(b)
The financial statements comply with Australian Accounting Standards as issued by the Australian Accounting Standards Board and
International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
Accounting policies and disclosures
(c)
The Consolidated Entity has adopted all new and amended Australian Accounting Standards and AASB interpretations which were
applicable as of 1 July 2013. There were some increases to disclosures that were required as a result of AASB 12 – Disclosure of
Interests in Other Entities, though this had no material impact on the financial position or performance of the Consolidated Entity.
Adoption of other new and amended Australian Accounting Standards and AASB interpretations did not have any effect on the
financial position or performance of the Consolidated Entity.
The Consolidated Entity has not elected to early adopt any new standards or amendments.
Going Concern
The accounts have been prepared on the going concern basis, which contemplates continuity of normal business activities and the
realisation of assets and liabilities in the normal course of business.
The Consolidated Entity had cash assets of $1,073,739 at 30 June 2014. The directors acknowledge that continued exploration and
development of the consolidated group’s mineral exploration projects will necessitate further capital raisings.
The Consolidated Entity remains dependent on its ability to raise funding in volatile capital markets. However, the directors
continue to believe that the going concern basis of accounting by the Consolidated Entity is appropriate as the Company and
Consolidated Entity have successfully completed a capital raising during the year to 30 June 2014, notwithstanding the challenging
conditions in equity markets.
In consideration of the above matters, the directors have determined that it is reasonably foreseeable that the Consolidated Entity will
continue as going concern and that it is appropriate that the going concern method of accounting be adopted in the preparation of the
financial statements. In the event that the Consolidated Entity is unable to continue as a going concern (due to inability to raise future
funding requirements), it may be required to realise its assets at amounts different to those currently recognised, settle liabilities other
than in the ordinary course of business and make provisions for other costs which may arise as a result of cessation or curtailment of
normal business operations.
Accordingly, the financial statements do not include adjustments relating to the recoverability and classification of assets amount
or to the amounts and classification of liabilities that might be necessary if the Consolidated Entity does not continue a going
concern.
Principles of consolidation
(d)
The consolidated financial statements include the financial statements of Cullen Resources Limited and the results of all of its
controlled entities which are referred to collectively throughout these financial statements as the “Consolidated Entity”. The results
of controlled entities are prepared for the same reporting period as the parent, using consistent accounting policies. All inter‐entity
balances and transactions, and unrealised profits arising from intra‐economic entity transactions, have been eliminated in full.
Taxes
(e)
Income tax
Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences, except:
where the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction
34
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or
loss; or
in respect of taxable temporary differences associated with investments in subsidiaries, associates and interest in joint venture,
where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary
differences will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry‐forward of unused tax assets and unused
tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences,
and the carry‐forward of unused tax credits and unused tax losses can be utilised, except:
where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an
asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; or
in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint
ventures, deferred tax assets are only recognised to the extent that it is probable that the temporary differences will reverse
in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is
realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance
sheet date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the Consolidated Statement of
Comprehensive Income.
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST except:
where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST
is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the
Consolidated Statement of Financial Position. Cash flows are included in the Consolidated Statement of Cash Flows on a gross basis
and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the
taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
Provision for employee benefits
(f)
Provision has been made in the financial statements for benefits accruing to employees in relation to annual leave and long service
leave. Annual leave provisions expected to be settled within twelve months are measured at their nominal amounts. Long service
leave provisions are measured at the present value of the estimated future cash outflow to be made in respect of services provided
by employees up to the reporting date. In determining the present value of future cash outflows, the interest rates attaching to
national government bond securities which have terms to maturity approximating the terms of the related liabilities are used.
Investments in controlled entities
(g)
Investments in controlled entities are carried in the company’s financial statements at the lower of cost and recoverable amount.
Dividends and distributions are brought to account when they are proposed by the controlled entities.
Exploration and Evaluation Expenditure
Expenditure is deferred
(h)
(i)
Expenditure on exploration and evaluation is accounted for in accordance with the 'area of interest' method. Exploration and
evaluation expenditure is capitalised provided the rights to tenure of the area of interest is current and either:
the exploration and evaluation activities are expected to be recouped through successful development and exploitation of the
area of interest or, alternatively, by its sale; or
exploration and evaluation activities in the area of interest have not at the reporting date reached a stage that permits a
reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant
operations in, or relating to, the area of interest are continuing.
35
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
When the technical feasibility and commercial viability of extracting a mineral resource have been demonstrated then any
capitalised exploration and evaluation expenditure is reclassified as capitalised mine development. Prior to reclassification,
capitalised exploration and evaluation expenditure is assessed for impairment.
Impairment
The carrying value of capitalised exploration and evaluation expenditure is assessed for impairment at the area of interest level
whenever facts and circumstances suggest that the carrying amount of the asset may exceed its recoverable amount.
An impairment exists when the carrying amount of an area of interest exceeds its estimated recoverable amount. The area of
interest is then written down to its recoverable amount. Any impairment losses are recognised in the Consolidated Statement of
Comprehensive Income.
(i)
Both the functional and presentation currency of Cullen Resources Limited and its Australian subsidiaries is Australian dollars ($A).
Foreign currency
Foreign currency transactions are translated to Australian currency at the rate of exchange ruling at the date of the transactions.
Monetary items in foreign currencies at balance date are translated at the rates of exchange ruling on that date.
Exchange differences relating to amounts payable and receivable in foreign currencies are brought to account in the Consolidated
Statement of Comprehensive Income in the financial year in which the exchange rates change, as exchange gains or losses.
(j)
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses.
Plant and equipment
Depreciation is calculated on a straight‐line basis over the estimated useful life of the assets as follows:
Plant and equipment – over 3 to 8 years.
The assets residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate at each financial year
end.
Revenue
(k)
Other revenue includes interest revenue on short term deposit received from other persons. It is brought to account using the
effective interest rate method. This is a method of calculating the amortised cost of a financial asset and allocating the interest
income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to the net carrying amount of the financial asset.
Joint Operations
(l)
The Consolidated Entity recognises in relation to its joint operations:
‐
Assets, including its share of any assets held jointly
‐
Liabilities, including its share of any liabilities incurred jointly
‐
Revenue from the sale of its share of the output arising from the joint operation
‐
Share of the revenue from the sale of the output by the joint operation
‐
Expenses, including its share of any expenses incurred jointly
Payables
(m)
Liabilities for trade creditors and other amounts are carried at cost which is the fair value of the consideration to be paid in the
future for goods and services received, whether or not billed to the Consolidated Entity.
Cash and cash equivalents
(n)
Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short‐term deposits with an original
maturity of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant
risk of changes in value. For the purposes of the Consolidated Statement of Cash Flows, cash includes cash on hand and in banks,
and money market investments readily convertible to cash within 2 working days.
Leases
(o)
The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement and requires an
assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset or assets and the
arrangement conveys a right to use the asset.
Operating lease payments are recognised as an expense in the Consolidated Statement of Comprehensive Income on a straight‐line
basis over the lease term.
36
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Issued capital
(p)
Issued and paid up capital is recognised at the fair value of the consideration received by the Consolidated Entity. Any transaction
costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share proceeds received.
Earnings per share (EPS)
(q)
Basic EPS is calculated as net profit/(loss) attributable to members, adjusted to exclude costs of servicing equity, divided by the
weighted average number of ordinary shares, adjusted for any bonus element. Diluted EPS is calculated as net profit/ (loss)
attributable to members, adjusted for:
costs of servicing equity;
the after tax effect of interest associated with dilutive potential ordinary shares that have been recognised as expenses;
and
other non‐discretionary changes in revenues or expenses during the period that would result from the dilution of potential
ordinary shares;
divided by the weighted average number of ordinary shares, adjusted for any bonus element.
(r)
The accounting policies adopted are consistent with those of the previous year, except as noted at Note 1(c).
Change in accounting policies
Share based payments
(s)
At each subsequent reporting date until vesting, the cumulative charge to the Consolidated Statement of Comprehensive Income is
the product of:
(i)
(ii)
(iii)
The grant date fair value of the option.
The current best estimate of the number of options that will vest, taking into account such factors as the likelihood of
employee turnover during the vesting period and the likelihood of non‐market performance conditions being met.
The expired portion of the vesting period.
The charge to the Consolidated Statement of Comprehensive Income for the period is the cumulative amount as calculated above
less the amounts already charged in previous periods. There is a corresponding entry to equity.
The company may also issue options that do not have any vesting conditions.
Until an option has vested, any amounts recorded are contingent and will be adjusted if more or fewer options vest than were
originally anticipated to do so. Any option subject to a market condition is considered to vest irrespective of whether or not that
market condition is fulfilled, provided that all other conditions are satisfied.
If the terms of an equity‐settled option are modified, as a minimum an expense is recognised as if the terms had not been
modified. An additional expense is recognised for any modification that increases the total fair value of the share‐based payment
arrangement, or is otherwise beneficial to the employee, as measured at the date of modification.
If an equity‐settled option is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet
recognised for the option is recognised immediately. However, if a new option is substituted for the cancelled option and
designated as a replacement option on the date that it is granted, the cancelled and new option are treated as if they were a
modification of the original option, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of diluted earnings per
share.
Investment and other financial assets
(t)
Financial assets in the scope of AASB 139 Financial Instruments: Recognition and Measurement are classified as either financial assets
at fair value through profit or loss, loans and receivables, held‐to‐maturity investments, or available‐for‐sale investments, as
appropriate. When financial assets are recognised initially, they are measured at fair value, plus, in the case of assets not at fair value
through profit or loss, directly attributable transactions costs. The Consolidated Entity determines the classification of its financial
assets after initial recognition and, when allowed and appropriate, re‐evaluates this designation at each financial year‐end.
Subsequent measurement of available‐for‐sale financial assets
Available‐for‐sale financial assets are non‐derivative financial assets that are designated as available‐for‐sale. After initial
measurement, available–for‐sale financial assets are measured at fair value with unrealised gains or losses recognised as other
comprehensive income in the available‐for‐sale reserve until the investment is derecognised, at which time the cumulative gain or
loss recorded is recognised in the income statement, or determined to be impaired, at which time the cumulative loss recorded is
recognised in the Consolidated Statement of Comprehensive Income.
37
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Impairment of non‐financial assets
(u)
Non‐financial assets are tested 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. 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 that are largely
independent of the cash inflows from other assets or groups of assets (cash‐generating units). Non‐financial assets other than
goodwill that suffered impairment are tested for possible reversal of the impairment whenever events or changes in circumstances
indicate that the impairment may have reversed.
New accounting standards and interpretations
(v)
International Accounting Standards and Interpretations that have recently been issued or amended but are not yet effective have
not been adopted by the Group for the annual reporting period ended 30 June 2014. These are outlined in the table below.
38
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Reference
Title
Summary
AASB 2012‐3
Amendments to
Australian
Accounting
Standards ‐
Offsetting Financial
Assets and
Financial Liabilities
AASB 2012‐3 adds application guidance to AASB 132
Financial Instruments: Presentation to address
inconsistencies identified in applying some of the
offsetting criteria of AASB 132, including clarifying the
meaning of "currently has a legally enforceable right of
set‐off" and that some gross settlement systems may be
considered equivalent to net settlement.
Application
date of
standard*
Application
date for
Group*
1 January 2014
1 July 2014
Interpretation
21
Levies
AASB 1055
Not applicable
to this company.
Budgetary
Reporting
This Interpretation confirms that a liability to pay a levy is
only recognised when the activity that triggers the
payment occurs. Applying the going concern assumption
does not create a constructive obligation.
1 January 2014
1 July 2014
1 July 2014
1 July 2014
This standard specifies budgetary disclosure
requirements for the whole of government, General
Government Sector (GGS) and not‐for‐profit entities
within the GGS of each government.
AASB 2013‐1 removes the requirements relating to the
disclosure of budgetary information from AASB 1049
(without substantive amendment). All budgetary
reporting requirements applicable to public sector
entities are now located in AASB 1055.
‐ 39 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Application
date of
standard*
Application
date for
Group*
1 January 2018
1 July 2018
Reference
Title
Summary
AASB 9/IFRS 9
Financial
Instruments
On 24 July 2014 The IASB issued the final version of IFRS
9 which replaces IAS 39 and includes a logical model for
classification and measurement, a single, forward‐looking
‘expected loss’ impairment model and a substantially‐
reformed approach to hedge accounting.
IFRS 9 is effective for annual periods beginning on or
after 1 January 2018. However, the Standard is available
for early application. The own credit changes can be early
applied in isolation without otherwise changing the
accounting for financial instruments.
The final version of IFRS 9 introduces a new expected‐
loss impairment model that will require more timely
recognition of expected credit losses. Specifically, the
new Standard requires entities to account for expected
credit losses from when financial instruments are first
recognised and to recognise full lifetime expected losses
on a more timely basis.
The AASB is yet to issue the final version of AASB 9. A
revised version of AASB 9 (AASB 2013‐9) was issued in
December 2013 which included the new hedge
accounting requirements, including changes to hedge
effectiveness testing, treatment of hedging costs, risk
components that can be hedged and disclosures.
AASB 9 includes requirements for a simplified approach
for classification and measurement of financial assets
compared with the requirements of AASB 139.
The main changes are described below.
a.
b.
c.
Financial assets that are debt instruments will be
classified based on (1) the objective of the entity's
business model for managing the financial assets;
(2) the characteristics of the contractual cash flows.
Allows an irrevocable election on initial recognition
to present gains and losses on investments in equity
instruments that are not held for trading in other
comprehensive income. Dividends in respect of
these investments that are a return on investment
can be recognised in profit or loss and there is no
impairment or recycling on disposal of the
instrument.
Financial assets can be designated and measured at
fair value through profit or loss at initial recognition
if doing so eliminates or significantly reduces a
measurement or recognition inconsistency that
would arise from measuring assets or liabilities, or
recognising the gains and losses on them, on
different bases.
d. Where the fair value option is used for financial
liabilities the change in fair value is to be accounted
for as follows:
►
►
The change attributable to changes in credit
risk are presented in other comprehensive
income (OCI)
The remaining change is presented in profit or
loss
AASB 9 also removes the volatility in profit or loss that
was caused by changes in the credit risk of liabilities
elected to be measured at fair value. This change in
accounting means
the
that gains
deterioration of an entity’s own credit risk on such
liabilities are no longer recognised in profit or loss.
caused by
‐ 40 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Reference
Title
Summary
Application
date of
standard*
Application
date for
Group*
Consequential amendments were also made to other
standards as a result of AASB 9, introduced by AASB
2009‐11 and superseded by AASB 2010‐7, AASB 2010‐
10 and AASB 2014‐1 – Part E.
AASB 2013‐3 amends the disclosure requirements in
AASB 136 Impairment of Assets. The amendments
include the requirement to disclose additional
information about the fair value measurement when the
recoverable amount of impaired assets is based on fair
value less costs of disposal.
AASB 2013‐4 amends AASB 139 to permit the
continuation of hedge accounting in specified
circumstances where a derivative, which has been
designated as a hedging instrument, is novated from one
counterparty to a central counterparty as a consequence
of laws or regulations.
These amendments define an investment entity and
require that, with limited exceptions, an investment
entity does not consolidate its subsidiaries or apply AASB
3 Business Combinations when it obtains control of
another entity.
These amendments require an investment entity to
measure unconsolidated subsidiaries at fair value
through profit or loss in its consolidated and separate
financial statements.
These amendments also introduce new disclosure
requirements for investment entities to AASB 12 and
AASB 127.
1 January 2014
1 July 2014
1 January 2014
1 July 2014
1 January 2014
1 July 2014
AASB 2013‐7 removes the specific requirements in
relation to consolidation from AASB 1038, which leaves
AASB 10 as the sole source for consolidation
requirements applicable to life insurer entities.
1 January 2014
1 July 2014
AASB 2013‐3
AASB 2013‐4
AASB 2013‐5
AASB 2013‐7
Amendments to
AASB 136 –
Recoverable
Amount Disclosures
for Non‐Financial
Assets
Amendments to
Australian
Accounting
Standards –
Novation of
Derivatives and
Continuation of
Hedge Accounting
[AASB 139]
Amendments to
Australian
Accounting
Standards –
Investment Entities
[AASB 1, AASB 3,
AASB 7, AASB 10,
AASB 12, AASB 107,
AASB 112, AASB
124, AASB 127,
AASB 132, AASB
134 & AASB 139]
Amendments to
AASB 1038 arising
from AASB 10 in
relation to
Consolidation and
Interests of
Policyholders
[AASB 1038]
‐ 41 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Application
date of
standard*
Application
date for
Group*
1 July 2014
1 July 2014
1 July 2014
1 July 2014
Reference
Title
Summary
AASB 2014‐1
Part A ‐Annual
Improvements
2010–2012
Cycle
Amendments to
Australian
Accounting
Standards ‐ Part A
Annual
Improvements to
IFRSs 2010–2012
Cycle
AASB 2014‐1
Part A ‐Annual
Improvements
2011–2013
Cycle
Amendments to
Australian
Accounting
Standards ‐ Part A
Annual
Improvements to
IFRSs 2011–2013
Cycle
AASB 2014‐1 Part A: This standard sets out amendments
to Australian Accounting Standards arising from the
issuance by the International Accounting Standards
Board (IASB) of International Financial Reporting
Standards (IFRSs) Annual Improvements to IFRSs 2010–
2012 Cycle and Annual Improvements to IFRSs 2011–2013
Cycle.
Annual Improvements to IFRSs 2010–2012 Cycle
addresses the following items:
► AASB 2 ‐ Clarifies the definition of 'vesting conditions'
and 'market condition' and introduces the definition
of 'performance condition' and 'service condition'.
► AASB 3 ‐ Clarifies the classification requirements for
contingent consideration in a business combination
by removing all references to AASB 137.
► AASB 8 ‐ Requires entities to disclose factors used to
identify the entity's reportable segments when
operating segments have been aggregated. An entity
is also required to provide a reconciliation of total
reportable segments' asset to the entity's total
assets.
► AASB 116 & AASB 138 ‐ Clarifies that the
determination of accumulated depreciation does not
depend on the selection of the valuation technique
and that it is calculated as the difference between
the gross and net carrying amounts.
► AASB 124 ‐ Defines a management entity providing
KMP services as a related party of the reporting
entity. The amendments added an exemption from
the detailed disclosure requirements in paragraph 17
of AASB 124 for KMP services provided by a
management entity. Payments made to a
management entity in respect of KMP services
should be separately disclosed.
Annual Improvements to IFRSs 2011–2013 Cycle
addresses the following items:
► AASB13 ‐ Clarifies that the portfolio exception in
paragraph 52 of AASB 13 applies to all contracts
within the scope of AASB 139 or AASB 9, regardless
of whether they meet the definitions of financial
assets or financial liabilities as defined in AASB 132.
► AASB40 ‐ Clarifies that judgment is needed to
determine whether an acquisition of investment
property is solely the acquisition of an investment
property or whether it is the acquisition of a group of
assets or a business combination in the scope of
AASB 3 that includes an investment property. That
judgment is based on guidance in AASB 3.
‐ 42 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Application
date of
standard*
Application
date for
Group*
1 January 2014
1 July 2014
1 July 2014
1 July 2014
1 January 2016
1 July 2016
1 January 2016
1 July 2016
Reference
Title
Summary
AASB 1031
Materiality
Amendments to
Australian
Accounting
Standards –
Conceptual
Framework,
Materiality and
Financial
Instruments
Regulatory deferral
accounts
AASB 2013‐9
AASB 14
The application
of this IFRS is
highly unlikely
to have an
impact on
Australian
companies.
Amendments to
IAS 16 and IAS
38
These IFRS
amendments
have not yet
been adopted
by the AASB.
Clarification of
Acceptable
Methods of
Depreciation and
Amortisation
(Amendments to
IAS 16 and IAS 38)
The revised AASB 1031 is an interim standard that cross‐
references to other Standards and the Framework (issued
December 2013) that contain guidance on materiality.
AASB 1031 will be withdrawn when references to AASB
1031 in all Standards and Interpretations have been
removed.
AASB 2014‐1 Part C issued in June 2014 makes
amendments to eight Australian Accounting Standards to
delete their references to AASB 1031. The amendments
are effective from 1 July 2014*.
The Standard contains three main parts and makes
amendments to a number Standards and Interpretations.
Part A of AASB 2013‐9 makes consequential amendments
arising from the issuance of AASB CF 2013‐1.
Part B makes amendments to particular Australian
Accounting Standards to delete references to AASB 1031
and also makes minor editorial amendments to various
other standards.
Part C makes amendments to a number of Australian
Accounting Standards, including incorporating Chapter 6
Hedge Accounting into AASB 9 Financial Instruments.
AASB 14 permits first‐time adopters to continue to
account for amounts related to rate regulation in
accordance with their previous GAAP when they adopt
Australian Accounting Standards. However, to enhance
comparability with entities that already apply Australian
Accounting Standards and do not recognise such
amounts, AASB 14 requires that the effect of rate
regulation must be presented separately from other
items. An entity that is not a first‐time adopter of
Australian Accounting Standards will not be able to apply
AASB 14.
AASB 2014‐1 Part D makes amendments to AASB 1 First‐
time Adoption of Australian Accounting Standards, which
arise from the issuance of AASB 14 Regulatory Deferral
Accounts in June 2014.
IAS 16 and IAS 38 both establish the principle for the
basis of depreciation and amortisation as being the
expected pattern of consumption of the future economic
benefits of an asset.
The IASB has clarified that the use of revenue‐based
methods to calculate the depreciation of an asset is not
appropriate because revenue generated by an activity
that includes the use of an asset generally reflects factors
other than the consumption of the economic benefits
embodied in the asset.
The IASB also clarified that revenue is generally
presumed to be an inappropriate basis for measuring the
consumption of the economic benefits embodied in an
intangible asset. This presumption, however, can be
rebutted in certain limited circumstances.
‐ 43 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Reference
Title
Summary
Application
date of
standard*
Application
date for
Group*
1 January 2016
1 July 2016
Amendments to
IAS 16 and IAS
41 for bearer
plants
Agriculture: Bearer
Plants
(Amendments to
IAS 16 and IAS 41)
These IFRS
amendments
have not yet
been adopted
by the AASB.
AASB 2014‐1
Part B
Amendments to
AASB 119
Amendments to
Australian
Accounting
Standards ‐ Part B
Defined Benefit
Plans: Employee
Contributions
(Amendments to
AASB 119)
The amendments require that bearer plants such as
grape vines, rubber trees and oil palms, should be
accounted for in the same way as property, plant and
equipment in IAS 16 Property, Plant and Equipment,
because their operation is similar to that of
manufacturing. Consequently, the amendments issued in
June 2014 include them within the scope of IAS 16,
instead of IAS 41.
The produce growing on bearer plants will remain within
the scope of IAS 41.
AASB 2014‐Part B makes amendments in relation to the
requirements for contributions from employees or third
parties that are set out in the formal terms of the benefit
plan and linked to service.
1 July 2014
1 July 2014
The amendments clarify that if the amount of the
contributions is independent of the number of years of
service, an entity is permitted to recognise such
contributions as a reduction in the service cost in the
period in which the related service is rendered, instead of
attributing the contributions to the periods of service.
‐ 44 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Reference
Title
Summary
Revenue from
Contracts with
Customers
In May 2014, the IASB issued IFRS 15 Revenue from
Contracts with Customers, which replaces IAS 11
Construction Contracts,
IFRS 15
These IFRS
amendments
have not yet
been adopted
by the AASB.
Application
date of
standard*
Application
date for
Group*
1 January 2017
1 July 2017
1 July 2016
1 July 2016
IAS 18 Revenue and related Interpretations (IFRIC 13
Customer Loyalty Programmes, IFRIC 15 Agreements for
the Construction of Real Estate, IFRIC 18 Transfers of
Assets from Customers and SIC‐31 Revenue—Barter
Transactions Involving Advertising Services)
The core principle of IFRS 15 is that an entity recognises
revenue to depict the transfer of promised goods or
services to customers in an amount that reflects the
consideration to which the entity expects to be entitled
in exchange for those goods or services. An entity
recognises revenue in accordance with that core principle
by applying the following steps:
(a) Step 1: Identify the contract(s) with a customer
(b) Step 2: Identify the performance obligations in the
contract
(c) Step 3: Determine the transaction price
(d) Step 4: Allocate the transaction price to the
performance obligations in the contract
(e) Step 5: Recognise revenue when (or as) the entity
satisfies a performance obligation
Early application of this standard is permitted.
AASB 1056 is a new Standard applying to superannuation
entities replacing AAS 25 Financial Reporting by
Superannuation Plans. This new standard specifies
requirements for general purpose financial statements of
superannuation entities and results in significant changes
to presentation of financial statements, measurement
and disclosure of defined benefit obligations and
disclosure of disaggregated financial information.
‐ 45 ‐
AASB 1056
Superannuation
Entities
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Application
date of
standard*
Application
date for
Group*
1 July 2014
1 July 2014
Reference
Title
Summary
AASB 2014‐2
Amendments to
AASB 1053 –
Transition to and
between Tiers, and
related Tier 2
Disclosure
Requirements
[AASB 1053]
The Standard makes amendments to AASB 1053
Application of Tiers of Australian Accounting Standards
to:
• clarify that AASB 1053 relates only to general
purpose financial statements;
• make AASB 1053 consistent with the availability of
the AASB 108 Accounting Policies, Changes in
Accounting Estimates and Errors option in AASB 1
First‐time Adoption of Australian Accounting
Standards;
• clarify certain circumstances in which an entity
applying Tier 2 reporting requirements can apply the
AASB 108 option in AASB 1; permit an entity applying
Tier 2 reporting requirements for the first time to do
so directly using the requirements in AASB 108
(rather that applying AASB 1) when, and only when,
the entity had not applied, or only selectively
applied, applicable recognition and measurement
requirements in its most recent previous annual
special purpose financial statements; and
• specify certain disclosure requirements when an
entity resumes the application of Tier 2 reporting
requirements.
The adoption of these new and revised Standards and Interpretations will not have an impact on the financial position or
performance of the Group.
2.
SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS
In applying the Consolidated Entity’s accounting policies management continually evaluates estimates and assumptions
based on experience and other factors, including expectations of future events that may have an impact on the Consolidated
Entity. All estimates and assumptions made are believed to be reasonable based on the most current set of circumstances
available to management. Actual results may differ from the estimates and assumptions. Significant estimates and
assumptions made by the management in the preparation of these financial statements are outlined below:
Significant accounting estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future
events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying
amounts of certain assets and liabilities within the next annual reporting period are:
Impairment of capitalised exploration and evaluation expenditure
(a)
The future recoverability of capitalised exploration expenditure is dependent on a number of factors, including whether the
Consolidated Entity decides to exploit the related lease itself or, if not, whether it successfully recovers the related
exploration and evaluation asset through sale. Factors that could impact the future recoverability include the level of
reserves and resources, future technological changes, which could impact the cost of mining, future legal changes (including
changes to environmental restoration obligations) and changes to commodity prices. To the extent that capitalised
exploration and evaluation expenditure is determined not to be recoverable in the future, profits and net assets will be
reduced in the period in which this determination is made. In addition, exploration and evaluation is capitalised if activities in
the area of interest have not yet reached a stage that permits a reasonable assessment of the existence or otherwise of
economically recoverable reserves. To the extent it is determined in the future that this capitalised expenditure should be
written off, profits and net assets will be reduced in the period in which this determination is made.
Share‐based payment transactions
(b)
The Consolidated Entity 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 external valuer using either a
binomial or Black‐Scholes model, with the assumption detailed in Note 16. The accounting estimates and assumptions
relating to equity‐settled share‐based payments would have no impact on the carrying amount of assets and liabilities within
the next annual reporting period but may impact expenses and equity.
‐ 46 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
3. REVENUE AND EXPENSES
(Loss) after crediting the following revenues:
Other Revenues
Interest received
Research and development grant
Foreign exchange gain
Royalty
Loss after charging the following expenses:
Consolidated
2014
$
2013
$
29,223
83,527
‐
3,461
116,211
40,481
156,191
9,227
‐
205,899
Auditors remuneration in respect of the Audit of the financial statements
54,877
54,250
Provision for employee benefits
Operating lease payments
Superannuation
4.
INCOME TAX
The major components of income tax expenses
are:
Income Statement
Current Income Tax
Current income tax charge/(benefit)
Deferred Income Tax
Relating to origination and reversal of
temporary differences
Income tax expense/(benefit) reported in the
statement of comprehensive income
Operating loss before income tax
Prima facie income tax (benefit)
calculated at 30% (2013: 30%)
Non‐deductible expenses
Income tax losses carried forward/(utilised)
(8,690)
(35,304)
41,966
42,560
58,149
80,898
‐
‐
‐
‐
‐
‐
(1,880,593)
(2,078,566)
(564,178)
(623,570)
6,769
3,328
557,409
620,242
Total income tax (expense)/benefit
‐
‐
Cullen Resources Limited and its 100% owned subsidiaries have entered the tax consolidation regime from 1 July
2002. The head entity of the tax consolidation group is Cullen Resources Limited.
The entity has adopted the stand alone taxpayer method for measuring current and deferred tax amounts. The
members of the income tax consolidated group have entered into a tax funding agreement.
‐ 47 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Consolidated
Deferred Tax Liabilities
Statement of Financial
Position
Statement of Comprehensive
Income
2014
$
2013
$
2014
$
2013
$
Exploration
(1,345,166)
(1,263,486)
81,679
137,899
Deferred Tax Assets
Provisions
Accruals
Deferred tax assets used to
offset deferred tax liabilities (i)
Net Deferred Tax Recognised
in the Statement of Financial Position
36,549
10,500
39,155
10,500
(2,607)
‐
(10,592)
‐
1,298,117
1,213,831
(84,286)
(148,491)
‐
‐
‐
‐
(i)
As at 30 June 2014 future income tax benefits were available to the Consolidated Entity in respect of
operating losses and prospecting and exploration expenditure incurred. The directors estimate the
potential income tax benefit at 30 June 2014 in respect of tax losses not brought to account is
$14,023,744 (2013: $13,466,335) and there is no expiry date. The benefit of these losses has only been
brought to account to the extent needed to offset deferred tax liabilities. The remaining benefit will only
be obtained if:
(a)
(b)
the Consolidated Entity derives future assessable income of a nature and of sufficient amount to
enable the benefit to be realised.
the Consolidated Entity continues to comply with the conditions for deductibility imposed by the
law; and
(c) no changes in tax legislation adversely affect the Consolidated Entity in realising the benefit.
5. RECEIVABLES
Current
Other debtors
Other debtors includes GST receivable which is non‐interest bearing.
6. OTHER FINANCIAL ASSETS
Non current
Security deposits
The security deposits are non‐interest bearing and relate to mining tenements.
Consolidated
2014
$
2013
$
89,020
38,286
12,400
12,400
32,400
32,400
‐ 48 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
7. PLANT & EQUIPMENT
Plant & Equipment at cost
Accumulated depreciation
Total written down amount
(a) Reconciliation
Plant & Equipment
Carrying amount at beginning
Additions
Depreciation expense
8. EXPLORATION & EVALUATION
Costs carried forward in respect of
areas of interest in the exploration
and evaluation phase
Opening balance
Expenditure incurred during the year
Less
Impairment (a)
Closing balance net of impairment
Consolidated
2014
$
2013
$
164,153
(163,190)
963
164,153
(160,981)
3,172
3,172
‐
(2,209)
963
5,974
2,619
(5,421)
3,172
4,211,622
1,530,372
5,741,994
3,751,958
1,912,358
5,664,316
(1,258,108)
(1,452,694)
4,483,886
4,211,622
Mining tenements are carried forward in accordance with the accounting policy set out in Note 1.
The ultimate recoupment of the book value of deferred costs relating to areas of interest in the exploration and
evaluation phase is dependent upon the successful development and commercial exploitation or, alternatively, sale
of the respective areas of interest and the Consolidated Entity’s ability to continue to meet its financial obligations to
maintain the areas of interest.
(a) Impairment
The Directors have reviewed all exploration projects for indicators of impairment in light of approved budgets.
Where substantive expenditure is neither budgeted nor planned the area of interest has been written down to its
fair value less costs to sell. In determining fair value less costs to sell the Directors had regard to the best evidence of
what a willing participant would pay in an arms length transaction. Where no such evidence was available, areas of
interest were written down to nil pending the outcome of any future farm‐out arrangement. The Company will
continue to look to attract farm‐in partners and/or recommence exploration should circumstances change.
9. TRADE AND OTHER PAYABLES
Current
Trade creditors ‐ unsecured
145,939
108,266
Trade creditors are non‐interest bearing and are normally settled on 30 day terms.
‐ 49 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
10. PROVISIONS
Current
Employee benefits
Non Current
Employee benefits
11. CONTRIBUTED EQUITY
Issued capital
1,038,472,843 ordinary shares
(2013: 818,389,431)
Movement in issued shares for the year:
Consolidated
2014
$
2013
$
121,829
103,917
‐
26,602
40,521,766
39,201,266
2014
2013
Number of
Shares
$
Number of
$
Beginning of the financial year:
Issued at 0.6 cents each (ii)
Issued at 2.0 cents each (ii)
Issued at 2.20 cents each (i)
Less share issue expenses
End of financial year:
818,389,431
220,083,412
‐
‐
‐
1,038,472,843
39,201,266
1,320,500
‐
‐
‐
40,521,766
Shares
693,089,431
‐
25,300,000
100,000,000
‐
818,389,431
36,605,266
‐
506,000
2,200,000
(110,000)
39,201,266
Ordinary shares have the right to receive dividends as declared and, in the event of winding up the company, to
participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid
upon shares held.
Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
(i) Issued under a placement.
(ii) Issued under a Share Purchase Plan to shareholders.
Options
As at 30 June 2014 there are 6,000,000 (2013: 22,000,000) unissued shares in respect of which options were
outstanding and the details of these are as follows:
Number
Grant Date
Vesting Date
6,000,000
6,000,000
9/06/14
Various
Exercise
Price
0.023
Expiry Date
31 May 2017
The options have no rights until they are exercised and become ordinary shares.
During the year 22,000,000 (2013: nil) options lapsed.
During the year 6,000,000 (2013: nil) options were issued to an employee to align their interest with
shareholders.
Since the end of the financial year no shares have been issued by virtue of the exercise of options.
‐ 50 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
12. SHARE BASED PAYMENT RESERVE
The share based payment reserve represents the cost of share‐based payments to directors, employees and
third parties.
Beginning of the year
Share based payments
End of the year
13. ACCUMULATED LOSSES
Accumulated losses at the beginning of the year
Net (loss)
Accumulated losses at the end of the year
Consolidated
2014
$
2013
$
1,280,125
21,600
1,280,125
‐
1,301,725
1,280,125
(34,550,658)
(1,880,593)
(36,431,251)
(32,472,092)
(2,078,566)
(34,550,658)
14. PARTICULARS IN RELATION TO CONTROLLED ENTITIES
The consolidated financial statements at 30 June 2014 include the following controlled entities. The financial
years of all controlled entities are the same as that of the parent entity.
Place of
Incorporation
Interest
%
Investment
$
Name
Cullen Minerals Pty Limited
Cullen Exploration Pty Ltd
Montrose Resources Pty Limited
Red Dirt Resources Pty Ltd *
Bearmark Investments Pty Ltd
Cullen Resources Namibia Pty Ltd
Cullen Exploration Inc
ARCTEX OY
ARCTEX AB
Australia
Australia
Australia
Australia
Botswana
Namibia
Canada
Finland
Sweden
*During the year this company was de‐registered.
June
2014
June
2013
100
100
100
‐
100
100
100
100
100
100
100
100
100
100
100
100
100
100
June
2014
‐
‐
1
‐
‐
15
1
4,072
7,915
June
2013
‐
‐
1
1
‐
15
1
4,072
7,915
‐ 51 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
15. KEY MANAGEMENT PERSONNEL
Compensation for key management personnel
Short‐term employee benefits
Post‐employment benefits
Other long‐term benefits
Termination benefits
Share‐based payments
Total compensation
16. SHARE BASED PAYMENTS
Consolidated
2014
$
2013
$
434,586
36,074
4,988
‐
‐
475,648
449,811
35,100
(18,500)
‐
‐
466,411
(a)
(b)
(i)
Recognised share based payment expenses
Director options
Employee options
2014
$
2013
$
‐
21,600
21,600
‐
‐
‐
Employee Options
Options held at the beginning of the reporting period
Number
Grant Date
Vest Date
Expiry Date
Weighted
Average
Exercise Price
6,000,000
14/3/11
14/3/11
13/3/14
$0.06
(ii)
Options lapsed / exercised during the year
Number
Grant Date
6,000,000
14/3/11
Vest
Date
14/3/11
Expiry
Date
13/3/14
Weighted Average
Exercise Price
$0.06
(iii)
Options issued during the year
Number
Grant Date
Vest Date
Expiry Date
6,000,000
9/6/14
Various*
31/5/17
Weighted
Average
Exercise
Price
$0.023
Weighted
Average
Share Price
$0.013
‐ 52 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
(iv)
Options held at the end of the reporting period
Number
Grant Date
Vest Date
Expiry Date
Exercise
Price
6,000,000
9/6/14
Various*
31/5/17
$0.023
Weighted Average
Fair Value
of Options
$0.0096
These options vest in three separate 2,000,000 tranches as follows:
‐
‐
‐
2m vested immediately
2m vest from 1 June 2015
2m vest from 1 June 2016
These options had a weighted average exercise price of $0.023 and a weighted average remaining contractual
life of 2.92 years.
The fair value of the equity settled share options granted are estimated as at the date of allocation using a
Binomial Model taking into account the terms and conditions upon which they were granted.
(v)
Valuation of options issued during the year
Number
Grant Date
Vest Date
Expiry Date
Exercise
Price
6,000,000
9/6/14
Various*
31/5/17
$0.023
Weighted Average
Fair Value
of Options
$0.0096
(c)
Weighted average remaining contractual life
Options ‐ Employee
Options ‐ Directors
(d)
Range of exercise prices
Options ‐ Employee
Options ‐ Directors
(e)
Weighted average fair value at date of issue
2014
Years
2.92
‐
2014
$
0.023
‐
2014
$
2013
Years
0.75
0.42
2013
$
0.06
0.075
2013
$
Options ‐ Employee
Options ‐ Directors
0.0096
‐
0.0216
0.0277
Option pricing model
(f)
The fair value of the equity settled share options granted are estimated as at the date of allocation using a
Binomial Model taking into account the terms and conditions upon which they were granted.
The following table lists the inputs to the models used at the date of allocation for employee options:
Dividend yield
Expected volatility
Risk free interest rate
Exercise price
Share price at measurement date
‐ 53 ‐
2014
2013
‐
145.31%
2.855%
0.023
0.013
‐
‐
‐
‐
‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
The following table lists the inputs used at the date of allocation for directors’ options:
Dividend yield
Expected volatility
Risk free interest rate
Exercise price
Share price at measurement date
17. JOINT OPERATIONS
2014
2013
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
The Consolidated Entity has interests in the following joint operations:
Principal Activity
Other Participant
(a) Hardey Junction
Exploration
Northern Star Resources Ltd (Northern Star)
(b) Mt Stuart
Exploration
Australian Premium Iron Management Pty Limited (API)
(c) Wyloo
Exploration
Fortescue Mining Group Limited (Fortescue)
(d) Tunnel Creek/Saltwater Pool
Exploration
Thundelarra Exploration / Lion One Metals Limited
(e) Paraburdoo
Exploration
Fortescue Mining Group Limited (Fortescue)
(f) Forrestania
Exploration
Hannans Reward Limited (Hannans)
(g) Killaloe
Exploration
Matsa Resources Limited (Matsa)
a)
b)
c)
d)
e)
f)
Northern Star has an 80% interest, Cullen is 20% free carried.
API has earned a 70% interest in the iron ore rights and Cullen is contributing at 30% for its interest.
Fortescue has a 51% interest and can earn up to 80% in the iron ore rights.
Thundelarra Exploration/ Lion One Metals can earn 70%, Cullen has a 100% interest.
Fortescue can earn up to 80% in the iron ore rights, Cullen has a 100% interest.
Hannans has an 80% interest; Cullen is 20% free carried.
g) Matsa has an 80% interest; Cullen is 20% free carried.
The joint operations are not separate legal entities. They are contractual arrangements between the participants for the
sharing of costs and any outputs and do not, in themselves, generate revenue and profit. The net contribution of any jointly
controlled assets to the operating profit before income tax is $Nil (2013: $Nil). The Consolidated Entity’s assets employed in
the jointly controlled assets, are included in the balance sheet of the Consolidated Entity as follows:
Current Assets
Receivables
Non‐Current Assets
Exploration and expenditure
Current Liabilities
Trade and other payables
Consolidated
2014
$
2013
$
44,124
233
4,457,944
4,211,349
‐
14,510
‐ 54 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
18. COMMITMENTS
(a) Minimum exploration work
The Consolidated Entity has certain obligations to perform minimum exploration work and expend minimum amounts of
money on mineral exploration tenements. The Consolidated Entity has committed to expend a minimum of $1,857,838
(2013: $1,878,980) over the next year to keep its current tenements in good standing. Approximately 64% (2013: 68%) of
this expenditure will be met by our joint operations partners.
(b) Joint Operation commitment
The Consolidated Entity has certain obligations in respect to the Mt Stuart joint operation and maybe required to expend
further funds over the next year being its share of the joint operation’s expenditure. The Consolidated Entity’s share of the
joint operation’s total budgeted expenditure over the next year is $420,000.
(c) Lease expenditure commitments
Lease expenditure commitment
Operating leases (non‐cancellable) for premises
Minimum lease payments
‐
‐
not later than one year
later than one year and not later than five years
Aggregate lease expenditure contracted for at reporting
date but not provided for
Consolidated
2014
$
2013
$
36,598
31,508
25,137
‐
68,106
25,137
A new lease for the premises was entered into for the period 1 May 2014 to 30 April 2016 with an option for a further two
years. There are no contingent rentals or restrictions imposed by the lease arrangements.
19. RELATED PARTIES
Payments to director related companies
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
20. OPERATING SEGMENTS
Identification of Reportable Segments
The Consolidated Entity has based its operating segment on the internal reports that are reviewed and used by the executive
management team in assessing performance and in determining the allocation of resources.
The Consolidated Entity currently does not have production and is only involved in exploration. As a consequence, activities
in the operating segment are identified by management based on the manner in which resources are allocated, the nature of
the resources provided and the identity of the manager and country of expenditure. Discrete financial information about
each of these areas is reported to the executive management team on a monthly basis.
Based on this criteria, the Consolidated Entity has only one operating segment, being exploration, and the segment
operations and results are the same as the Consolidated Entity’s results.
Non Current Assets by Geographical regions:
Australia
Canada
Consolidated
2014
$
2013
$
4,494,849
2,400
4,497,249
4,244,794
2,400
4,247,194
‐ 55 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
21. STATEMENT OF CASH FLOWS
(i) Reconciliation of cash
For the purposes of the Consolidated Statement of Cash Flows, cash includes cash at bank and short term deposits at call.
Cash at the end of the financial year as shown in the Consolidated Statement of Cash Flows is reconciled to the related items
in the Consolidated Statement of Financial Position as follows:
Cash on hand
(ii) Reconciliation of operating (loss)
after income tax to net cash used in operating activities
Operating (loss) after income tax
Add/(less) non cash items
Depreciation
Share based payments
Provisions for employee benefits
Impairment exploration expenditure
(Decrease) / Increase in trade and other payables
Decrease / (Increase) in receivables
Net operating cashflows
Consolidated
2014
$
2013
$
1,073,739
1,884,038
(1,880,593)
(2,078,566)
2,209
21,600
(8,690)
1,258,108
37,673
(50,734)
5,421
‐
(35,304)
1,452,694
(706,199)
105,729
(620,427)
(1,256,225)
Share based payments
During the year the Consolidated Entity made share based payments of $21,600 (2013: $Nil) to an employee of the
Consolidated Entity.
22. EARNINGS/(LOSS)PER SHARE
Basic (loss) per share (cents per share)
Diluted (loss) per share (cents per share)
The following reflects the income and share data used
in the calculations of basic and diluted (loss) per share
Net (loss)
Weighted average number of ordinary shares used in
the calculation of basic and diluted earnings per share
Options on issue at year end are not dilutive and hence
not used in the calculation of diluted EPS
23. FINANCIAL INSTRUMENTS
Consolidated
2014
2013
(0.21)
(0.21)
(0.23)
(0.23)
(1,880,593)
(2,078,566)
880,495,161
739,383,404
6,000,000
22,000,000
The Group's financial instruments comprise receivables, payables, and cash and short‐term deposits.
The Group manages its exposure to key financial risks, including interest rate risk in accordance with the Group's financial risk
management policy. The objective of the policy is to support the delivery of the Group's financial targets whilst protecting
future financial security.
The Board reviews and agrees policies for managing each of these risks as summarised below.
Primary responsibility for identification and control of financial risks rests with the Board of Directors. Due to the size and
nature of the company's operations, and as the company does not use derivative instruments or debt, the directors do not
believe the establishment of a risk management committee is warranted.
‐ 56 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
Interest Rate Risk
(a)
The Group's exposure to market interest rates relates primarily to the Group's cash and cash equivalents.
The Group's exposure to interest rate risk for each class of financial assets and financial liabilities is set out below.
Financial Instruments
Financial Assets
Cash and cash equivalents
Total Financial Assets
Consolidated
Floating
interest rate
Floating
interest rate
2014
$
2013
$
1,073,739
1,884,038
1,073,739
1,884,038
Cash gives rise to interest rate risk because the interest rate is variable.
The following summarises the effect on loss and equity of financial instruments held at balance date as a result of a 1%
movement in interest rates, with all other variables remaining constant.
Interest rate +1%
Interest rate ‐1%
Consolidated
2014
$
(10,737)
10,737
2013
$
(18,840)
18,840
The selection of 1% sensitivity check was based on recent interest rate adjustments.
(b) Currency Risk
The Consolidated Entity has limited exposure to foreign currency risk as it pays for its overseas exploration activities from
Australia in various overseas currencies.
(c) Credit Risk
Credit risk arises from the financial assets of the Consolidated Entity, namely trade and other receivables. The Consolidated
Entity's exposure to credit risk arises from potential default of the counter party, with a maximum exposure equal to its
carrying amount. Exposure at balance date is addressed in each applicable note.
The Consolidated Entity does not hold any credit derivatives to offset its credit exposure.
Receivable balances are monitored on an ongoing basis with the result that the Consolidated Entity's exposure to bad debts is
not significant. Receivables are due from the Australian Taxation Office and other government bodies which have very low
default risk.
There are no significant concentrations of credit risk within the Consolidated Entity and cash and cash equivalents are spread
amongst two of the big four Australian Banks.
(d) Liquidity Risk
The liquidity position of the Consolidated Entity is managed to ensure sufficient liquid funds are available to meet the
Consolidated Entity's financial commitments in a timely and cost‐effective manner. The Consolidated Entity funds its activities
through capital raisings in order to limit its liquidity risk which is monitored on a monthly basis.
Contractual maturity of the trade payables is within 30 day terms.
The Consolidate Entity manages its liquidity risk by monitoring the total cash inflows and outflows expected on a monthly basis.
The Consolidated entity has established comprehensive risk reporting covering its business units that reflect expectations of
management of the expected statement of financial assets and liabilities.
(e) Capital Management
Management controls the capital of the Consolidated Entity in order to provide the shareholders with adequate returns and
ensure that the group can fund its operations and continue as a going concern.
‐ 57 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
There are no externally imposed capital requirements.
Management effectively manages the group's capital by assessing the Consolidated Entity's financial risks and adjusting its
capital structure in responses to include the management of debt levels, distributions to shareholders and share issues.
The Consolidated Entity uses cash flow forecasts to manage and adjust its capital management.
There have been no changes in the strategy adopted by management to control the capital of the Consolidated Entity since the
prior year.
Capital managed by the Consolidated Entity consists of shareholders equity.
Shareholders equity
24. AUDITOR'S REMUNERATION
Amounts received or due and receivable
by Ernst and Young
‐
‐
an audit or review of the financial report
of the entity and any other entity in the
Consolidated Entity
taxation services provided to the Consolidated Entity
25. PARENT ENTITY INFORMATION
Information relating to Cullen Resources Limited.
Current assets
Total assets
Current liabilities
Total liabilities
Issued capital
Accumulated losses
Share based payment reserve
Total shareholders' equity
Loss of the parent entity
Total comprehensive income of the parent entity
Consolidated
2014
$
2013
$
5,392,240
5,930,733
Consolidated
2014
$
2013
$
54,877
8,353
54,250
2,000
2014
$
2013
$
1,053,435
5,480,120
75,818
75,818
40,521,766
36,419,189
1,301,725
5,404,302
1,880,418
1,880,418
1,609,295
5,995,280
52,660
52,660
39,201,266
34,538,771
1,280,125
5,942,620
2,324,315
2,324,315
The parent entity has no contingent liabilities, nor does it have any contractual commitments for the acquisition of property,
plant or equipment.
26. SUBSEQUENT EVENTS
There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or
event of a material and unusual nature likely, in the opinion of the directors, to affect the operations of the Consolidated
Entity, the results of those operations or the state of affairs of the Consolidated Entity in the subsequent financial years.
27. CORPORATE INFORMATION
The financial report of Cullen Resources Limited for the year ended 30 June 2014 was authorised for issue in accordance with
a resolution of the directors on 5 September 2014.
Cullen Resources Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the
Australian Stock Exchange.
‐ 58 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
DIRECTORS' DECLARATION
In accordance with a resolution of the directors of Cullen Resources Limited, I state that:
In the opinion of the directors:
(a)
the financial statements and notes of the Consolidated Entity are 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 (including the Australian Accounting
Interpretations) and the Corporations Regulations 2001; and
the financial statements and notes also comply with International Financial Reporting Standards as
disclosed in Note 1(b).
subject to the achievement of the matters in Note 1(c) 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.
this declaration has been made after receiving the declaration required to be made to the
directors in accordance with section 295A of the Corporations Act 2001 for the financial year
ending 30 June 2014.
(b)
(c)
(d)
On behalf of the Board
C. Ringrose
Director
Perth, WA
5 September 2014
‐ 59 ‐
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent auditor's report to the members of Cullen Resources
Limited
Report on the financial report
We have audited the accompanying financial report of Cullen Resources Limited, which comprises the
consolidated statement of financial position as at 30 June 2014, the consolidated statement of
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 controls as the directors determine are necessary to enable the preparation of the financial
report that is free from material misstatement, whether due to fraud or error. In Note 1, 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 judgment, 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 controls relevant to the entity's preparation and
fair presentation of the financial report 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 entity's
internal controls. 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 have given to the directors of the company a written Auditor’s Independence Declaration, a
copy of which is included in the directors’ report. We confirm that the Auditor’s Independence Declaration
would be in the same terms if given to the directors as at the time of this auditor’s report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PM:EH:CULLEN:026
Opinion
In our opinion:
a.
the financial report of Cullen Resources 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.
Emphasis of Matter
Without qualifying our opinion, we draw attention to Note 1(c) in the financial report. As a result of these
matters there is 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 pages 21 to 23 of 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 Cullen Resources Limited for the year ended 30 June 2014
complies with section 300A of the Corporations Act 2001.
Ernst & Young
Peter McIver
Partner
Perth
5 September 2014
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PM:EH:CULLEN:026
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
SHAREHOLDER INFORMATION
CAPITAL STRUCTURE
As at 3 September 2014, the company had the following securities on issue:
Issued Capital
Top 20 Shareholders
Total holding of twenty largest shareholders
% of total shares on issue
Distribution of shareholders
1 ‐ 1,000 shares
1,001 ‐ 5,000 shares
5,001 ‐ 10,000 shares
10,001 ‐ 100,000 shares
100,001 and over
Total
Fully paid
Ordinary shares
1,038,472,843
433,544,808
41.75%
165
178
370
1,566
837
3,116
Unmarketable Parcels as at 3 September 2014
Minimum $500.00
1,460
OPTIONS
As at 3 September 2014, 6,000,000 unissued shares in respect of options were outstanding.
These are as follows:
Number
6,000,000
Exercise Price
$0.023
Expiry Date
31 May 2017
SUBSTANTIAL SHAREHOLDERS
The company has three Substantial Shareholders as at 3 September 2014
Name
Perth Capital Pty Ltd, Wythenshawe
Pty Ltd & Associates
Baosteel Group Corporation & Aurizon
Holdings Limited
%
17.76
No. of shares
184,447,576
9.86
102,343,426
‐ 62 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2014
TWENTY LARGEST SHAREHOLDERS
The names of the twenty holders of the fully paid shares at 3 September 2014 are listed below:
Name
Penoir Pty Ltd
Wythenshawe Pty Ltd
Glyde Street Nominees Pty Ltd
Perth Capital Pty Ltd
Perth Capital Pty Ltd
Brisbane Investments I Ltd
Brisbane Investments II Ltd
Kitchsmith Pty Ltd
Innerleithen Pty Ltd
Warramboo Holdings Pty Ltd
Warramboo Holdings Pty Ltd
Chiatta Pty Ltd
Bellarine Gold Pty Ltd
Mr Hugh Wallace‐Smith
Aquila Resources Limited
A N Superannuation Pty Ltd
BT X Pty Ltd
Lindglade Enterprises Pty Ltd
Brendon Russell Strong
First Farley Pty Ltd
Total
No. of Shares
% Held
Rank
72,000,000
56,137,000
33,000,000
32,828,000
31,822,698
25,411,350
25,411,349
17,938,002
16,534,120
15,250,000
15,098,462
14,860,000
14,805,000
12,501,380
11,846,603
9,000,000
8,500,000
7,864,000
6,736,844
6,000,000
6.93
5.41
3.18
3.16
3.06
2.45
2.45
1.73
1.59
1.47
1.45
1.43
1.43
1.20
1.14
0.87
0.82
0.76
0.65
0.58
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
433,544,808
41.75
VOTING RIGHTS
Every member present in person or by representative shall on a show of hands have one vote, and on a poll
every member present in person or by representative, proxy or attorney shall have one vote in respect of each
fully paid share held by him.
‐ 63 ‐
C U L L E N
R E S O U R C E S L I M I T E D
Registered and Principal Office
Unit 4
7 Hardy Street
South Perth WA 6151
Telephone (08) 9474 5511
Facsimile (08) 9474 5588
Website: www.cullenresources.com.au
Email: cullen@cullenresources.com.au