Golden State Mining Limited
ABN 52 621 105 995
Annual Report
30 June 2021
1
Corporate Information
Directors
Mr. Michael Moore (Managing Director – appointed 15 August 2017)
Mr. Damien Kelly (Non-Executive Chairman – appointed 15 August 2017)
Mr. Greg Hancock (Non-Executive Director – appointed 6 April 2018)
Mr. Brenton Siggs (Non-Executive Director - appointed 10 August 2018)
Company Secretary
Mr. Marc Boudames
Registered Office and Principal Place of Business
Suite 15, 19-21, Outram Street
West Perth WA 6005
Australia
Telephone:
Email:
Website:
(+61 8) 6323 2384
info@gsmining.com.au
www.goldenstatemining.com.au
Share Register
Automic Group
Level 5, 126 Phillip Street
Sydney NSW 2000
Australia
Telephone: 1300 288 664
Facsimile:
+61 2 8583 3040
Stock Exchange Listing
Golden State Mining Limited is listed on the Australian Securities Exchange (ASX code: GSM)
Auditors
Stantons
Level 2, 1 Walker Avenue
West Perth WA 6005
Solicitors
EMK Lawyers
Suite 1B
Chamber of Commerce Building
16 Phillimore Street
Fremantle WA 6160
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Golden State Mining Limited
30 June 2021
TABLE OF CONTENTS
Contents
Chairman’s Letter
Directors' Report
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Directors' Declaration
Independent Auditor’s Report
ASX Additional Information
Tenement list
Page
4
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44
69
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74
76
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Golden State Mining Limited
30 JUNE 2021
CHAIRMAN’S LETTER
Dear Fellow Shareholder,
The company’s June 2021 financial year closed with excitement as we readied to launch our maiden reverse-
circulation (“RC”) drilling program at our Yule project following a major $3.2 million capital raise completed in
April 2021. This RC campaign was designed to follow up just some of the compelling gold anomalies
highlighted from our 28,000m of air-core (“AC”) drilling over 2020 and the subsequent, thorough examination
and review of those results, which included multiple, +100ppb anomalous gold intersections, broad zones of
hydrothermal alteration and quartz veining, and other identified gold and lithium pathfinders.
To deliver such results is very encouraging … being from a shallow, first pass reconnaissance program over
just some of our potential targets – based solely on aeromagnetic interpretation – in a largely untested
emerging gold district. It speaks volumes about our greenfield targeting and strategy at Yule. Yet only a fraction
of our ~700m2 at Yule has been tested to date. The results continue to warrant follow up RC drilling of yet-
untested anomalous zones and fresh reconnaissance AC drilling of unexplored targets, particularly intrusive
targets.
We have always appreciated the potential that lies under cover in this under-explored region and the nearby
Hemi discovery by De Grey Mining (ASX code: “DEG” or “De Grey”) continues to be a game-changer for the
whole region, with De Grey having released its maiden 6.8 million-ounce JORC resource near the end of June1.
Yule was one of our three founding projects when we first listed on ASX in November 2018. We were already
preparing for our first AC drilling program and expanding our tenement holding – at negligible cost – well before
De Grey announced (in February 2020) what seemed to be – and has since proven to be – a major new gold
discovery in the Pilbara.
Our maiden RC drilling program commenced just after the end of the financial year, which was well planned
and executed by Golden State Mining Limited’s (GSM) seasoned, hands on, professional team, competently
managing and overcoming many challenges. Three key target areas at Yule South were RC-drilled for a total
of 3,542 metres and all samples have now been sent for analysis at a laboratory in Perth and we eagerly await
the results. As most investors are aware, there is currently a long waiting period for assay results due to the
significant level of activity in the resources sector.
Further RC-drilling for gold and lithium is also planned for Yule South at Target 2A, where there is a large,
800m x 1400m arsenic anomaly and gold anomalism. The Company has also completed a new heritage survey
and booked an air-core rig for drilling on recently generated priority gold and lithium targets mostly at Yule East
in October.
Your team has also been working diligently throughout the year to explore and maximise value from our other
projects. The Murchison projects (Cuddingwarra/Cue) have been the subject of ongoing, integrated reviews
for potentially low risk, early cash flow opportunities and other opportunities to realize monetary value.
During the March quarter, Adaman Resources Pty Ltd completed the collection, mining and processing (at its
Kirkalocka Gold Mine processing plant) of the remnant mine tailings (battery sands) at the historic Cue No. 1
and Salisbury mines. Regrettably, Adaman was placed into administration shortly after and the Company
therefore expects to receive only a negligible return from this exercise, if any. Nevertheless, the Company
always made a point not to rely on any such potential income and to minimize any cost exposures given the
inherent risks in such operations. Other low-risk opportunities to realize monetary value at Cue are also under
consideration.
1 Refer to DEG ASX announcement of 23 June 2021.
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30 JUNE 2021
CHAIRMAN’S LETTER
Shortly after the end of the financial year (in July 2021), GSM entered into a joint venture with Caprice
Resources Limited (ASX: CRS) pursuant to which Caprice will acquire an 80% interest in the Cuddingwarra
and Big Bell South projects in return for GSM receiving around $750,000 in cash and Caprice shares2.
Importantly, GSM retains a 20% interest, free-carried to completion of a pre-feasibility study, allowing GSM to
focus on Yule, whilst entrusting Caprice to unlock the potential at Cuddingwarra and Big Bell South.
At our Four Mile Well project (located near the 1.3Moz Lancefield mine), two additional exploration licenses
were applied for, extending our tenure to the north of the existing tenement. These areas encompass a
geochemical anomaly recently identified during a review of historic geochemical datasets.
On behalf of the board, I express thanks to our whole team – especially Mike Moore, our managing director,
Geoff Willetts, our exploration manager – and to you, our shareholders, for your continued interest and support.
We look forward to an exciting year ahead!
Yours faithfully,
Damien Kelly
Chairman
29 September 2021
2 Refer to GSM ASX announcement of 27 July 2021. Value amount based on $200,000 cash component and ~$550,000 of Caprice shares
using the Caprice share price as at 26 July 2021.
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Golden State Mining Limited
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DIRECTORS’ REPORT
Your directors are pleased to present their report on the consolidated entity (referred to hereafter as the Group)
consisting of Golden State Mining Limited (the Company) and the entities it controlled at the end of, or during,
the year ended 30 June 2021.
DIRECTORS
The names and details of the Company's directors in office during the year and until the date of this report
follow. Each Director was in office for this entire period unless otherwise stated.
Names, qualifications, experience and special responsibilities
Michael Moore (B Eng (Hons) Mining Eng. ACSM MAusIMM MAICD) - Managing Director (Appointed 15
August 2017)
Mr Moore is a mining engineer from the Camborne School of Mines with over 20 years operational and
executive management experience across a diverse range of commodities in Australia, Indonesia, West
Africa and Europe.
He has previously held senior and executive management roles with a number of companies including Rock
Australia Mining & Civil Pty Ltd, Carnegie Minerals PLC and, more recently, with ASX listed Montezuma
Mining Company Ltd where he was CEO.
Mr Moore is a member of the Australian Institute of Company Directors and the Australian Institute of Mining
and Metallurgy. Mike is currently serving as a Non-Executive Director of Variscan Mines Ltd (ASX: VAR).
Damien Kelly (B.Com MBA CPA GDip App Fin & Inv) - Non-Executive Chairman (Appointed 15 August 2017)
Mr Kelly is the founder and principal of Western Tiger Corporate Advisers. He has broad corporate and
commercial experience spanning over 20+ years. He provides professional services to ASX and AIM listed
companies predominately in the natural resources sector (including the formation and initial listing of Sandfire
Resources NL). He has an MBA, Bachelor of Commerce, a Graduate Diploma in Applied Finance and
Investment and is
a former officer in the armed services, having graduated from the Royal Military College, Duntroon. He is also
a member of CPA Australia.
Greg Hancock (BA Econs B.Ed (Hons) F.Fin) - Non-Executive Director (Appointed 6 April 2018)
Mr Hancock has over 25 years’ experience in capital markets practicing in the area of Corporate Finance. He
has extensive experience in both Australia and the United Kingdom through his close links to the stockbroking
and investment banking community. In this time, he has specialised in mining and natural resources and has
had a background in the finance and management of small companies.
He is Chairman of AusQuest Limited, BMG Resources Limited, Cobra Resources Plc and Non-Executive
Director of Zeta Petroleum Plc and King Island Scheelite Ltd. Mr Hancock was also a director of Strata-X
Energy Ltd (since renamed Pure Hydrogen Corporation Limited) until March 2021.
Mr Hancock continues his close association with the capital markets in Australia and the United Kingdom
through his private company Hancock Corporate Investments Pty Ltd.
Brenton Siggs (B App Sc App Geol MAIG MSEG) Non-Executive Director (Appointed 10 August 2018)
Mr Siggs has over 29 years’ experience in the Australian mineral resources industry and has held senior
exploration roles on a range of gold, nickel-cobalt, petroleum, coal, phosphate and potash brine projects. He
has been involved in all stages of regional and near-mine exploration project management, particularly in
Western Australia, from conceptual targeting and ground acquisition through to resource definition drilling
programs and mining geology.
Mr Siggs has worked in senior roles for Australian and international companies including Newcrest Mining Ltd.,
Inco Australia, Central Norseman Gold Corporation and VALE and most recently was Technical Director and
the Exploration Manager for Goldphyre Resources Limited (now Australian Potash Limited).
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DIRECTORS’ REPORT
COMPANY SECRETARY / CHIEF FINANCIAL OFFICER
Marc Boudames (B.com CPA MAICD) - Appointed 6 April 2018
Mr Boudames is experienced in statutory financial reporting, taxation, ERP systems, business analytics,
corporate transactions, due diligence, mergers & acquisitions, finance, joint ventures and divestments. He
previously worked at RSM Bird Cameron (RSM), as General Manager - Finance & Administration for ASX
listed Redport Ltd and Mega Uranium Ltd (Australia), a Canadian TSX listed mining and equity investment
company focused on global uranium properties and multi-mineral exploration. He has worked for multiple
companies across various industries including listed and public companies associated with the mining and oil
& gas sectors such as Toro Energy Ltd, WesTrac, CB&I and Spotless Group.
Interests in the shares and options of the Company and related bodies corporate
As at the date of signing this report, the relevant interests of the directors in the shares and options of Golden
State Mining Limited were:
Director
Ordinary Shares
Michael Moore
Damien Kelly
Greg Hancock
Brenton Siggs
1,625,100
1,510,100
-
660,000
Options over
Ordinary Shares
3,000,000
2,700,000
1,300,000
1,550,000
PRINCIPAL ACTIVITIES
During the financial year, the Group’s principal activity was mineral exploration, evaluation and investment and
to assess and pursue mineral property acquisition opportunities.
DIVIDENDS
No dividends were paid or declared during the year. No recommendation for payment of dividends has been
made.
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DIRECTORS’ REPORT
GSM Annual Operations Report 2020-21
Yule Project – 100% GSM
Yule Phase 1 Aircore Program
A first phase of reconnaissance air-core (‘AC’) drilling over five gold target areas (Figure 1 & 2) on the two
southern tenements E47/3503 & 3507 (referred to as Yule South) was completed on 11 August 2020 with a
total of 199 holes drilled for a total advance of 13,275 metres (refer to Figure 2 and ASX announcements dated
14 August and 7 Sept 2020).
Figure 1: Yule South target location plan showing detailed magnetics of target areas over regional geology.
Key high priority targets
Target 1
This area consists of a tightly folded hinge zone of interpreted mafic units or an intrusive within the Mallina
formation metasediments and magnetic anomalies parallel to a major north-south structure.
Target 2
A >10km structural corridor ‘squeezed’ between nested and deformed granitoid complexes is interpreted to
contain altered metasediments and remnant greenstone enclaves within folded structures.
Target 3
The geology of this area is interpreted as a tightly folded greenstone/ultramafic sequence or intrusive along a
granite contact zone which is parallel to a regional NNE trending regional Pilbara structure.
Target 4
The magnetic signature of this area is interpreted as potential greenstone sequences within Mallina Basin
sediments which are proximal to a secondary fault splay trending NE off the Yule River Shear Zone (‘YRSZ’)
to east.
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DIRECTORS’ REPORT
Target 5
This target is located along the highly magnetic northern contact zone of a later intrusive body within the
Portree granite complex which is interpreted as a distinct intrusive phase or alteration zone.
Figure 2: Yule South location plan showing collar gold parts per billion x downhole metres summary.
Phase 1 AC Results
Target 1
Reconnaissance first pass angled Aircore drilling on nominal 320m line spacing and 80-160m hole centres
tested the hinge zone of an interpreted Mallina Basin mafic-metasedimentary rock package and a prominent
north-trending magnetic structure trending through the eastern part of Target 1. Thirty drillholes were
completed on this target for a total advance of 2,815 metres (Figure 3).
Drill logging revealed a sandy clay silcreted and calcrete cover horizon to approximately 30 metres, thence a
variable weathered sequence of interpreted Mallina Basin metasedimentary rocks including very fine-grained
siltstone, and medium grained sandstone and arkosic rocks on the eastern portion of the target area. Holes
testing the magnetic high zone on the south and western part of Target 1 recorded fine-grained sedimentary,
silicified felsic, dioritic intrusive and magnetic medium-grained doleritic lithologies.
Weak to moderate hydrothermal alteration was observed in several drill-holes with up to 2% sulphide
mineralisation recorded in saprock and transitional/fresh units as very fine to fine grained disseminated pyrite.
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Assay results revealed multiple anomalous gold intersections with a best intercept of 8 metres @ 0.92g/t Au
from 96 metres including 4 metres @ 1.81 g/t Au from 96m (20GSYSAC0002) which was recorded in a
weathered, fine-grained schistose saprolitic metasedimentary sequence. Drillhole 20GSYSAC0013 located on
a section 320m to the south intersected 20 metres @ 0.15g/t Au from 102 metres including 8 metres @ 0.30
g/t Au from 114m in a similar regolith setting. These gold intersections were based on four metre composite
samples.
Follow up drilling at Target 1 East consisted of extension and neighbouring infill holes and an additional scissor
hole to determine the extent and geometry of the host units of anomalous gold intersections. One metre assay
results from hole 20GSYSAC0002 have returned an intercept of 4 metres @ 2.3g/t Au from 99 metres including
a high-grade interval of 1 metre @ 7.6g/t Au from 99m. One metre samples from hole 20GSYSAC0013
returned 18 metres @ 0.17g/t Au from 104 metres. The impact of this first high-grade gold intercept recorded
in weathered bedrock clearly demonstrates the strong potential for gold bearing structures in the Yule project
area. Both gold intersections were observed in a weathered, fine-grained schistose saprolitic metasedimentary
sequence close to an interpreted felsic intrusive. Petrological analysis confirmed this field logging and reveals
a weakly foliated chlorite-sericite-biotite altered meta-wacke in hole 20GSYSAC0002 and a chlorite-quartz-
sericite-sulphide altered rock in hole 20GSYSAC0013.
The extensional infill drilling (holes 20GSYSAC0095-96) completed on a section 320 metres to the north
returned four +50ppb gold intersections in four metre composite samples and multiple +10ppb gold anomalies.
These intersections were recorded in similar metasedimentary rocks with pyrite mineralisation occurring
towards, and at the ends of both drill holes. Neighbouring infill drilling (holes 20GSYSAC0097-98), 80 metres
either side of hole 20GSYSAC0002 also returned four anomalous +50ppb gold intersections including two
+100ppb gold intervals in four metre composite samples. These holes also recorded multiple +10ppb gold
anomalies.
A scissor hole (20GSYSAC0199) angled 60o west, was drilled under 20GSYSAC0002 to gain a better
understanding of the geometry of the mineralised zone observed in 20GSYSAC0002. This hole intersected a
deeply weathered meta-siltstone-sandstone sequence with a dark grey, weathered siliceous unit recorded at
111-117 metres downhole. The best gold intersection returned 4 metres @ 0.06g/t from 110m in a four-metre
composite sample within the siliceous unit along with multiple +10ppb gold anomalies. This hole also recorded
minor fine- grained pyrite (<2%) towards and at the end of hole.
Figure 3: Target 1 location plan with significant results and collar gold parts per billion x downhole metres summary
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E47/3503
Figure 4: Collar location plan of Target 2 (Southern Section) and significant results.
Target 2
This target area was tested by reconnaissance first pass angled AC drilling on selective drill lines orientated
to test target corridors on 80-160 metre hole centres. The AC drilling tested prospective zones in the north and
south of a >10 kilometre structural corridor ‘squeezed’ between nested and deformed granitoid complexes.
The target sequence was interpreted to contain altered metasediments and remnant greenstone enclaves
within folded dilational structures.
Field drill logging revealed a clay to sand rich silcreted and calcretised in part, cover horizon to approximately
25 metres. Archaean bedrock geology at this target area revealed a range of variably weathered rock types
with interpreted Mallina Basin rocks including fine to medium grained arkosic (sandstone), quartz- biotite-
muscovite schist, fine grained mafic and amphibole-biotite-chlorite ultramafic types.
Two reconnaissance drill-lines on the southern section of Target 2 (Figure 4) were characterised by a marked
variable weathering profile, moderate schistosity, and minor, patchy quartz veining. The northernmost line in
the south area recorded an interpreted persistent silica-chlorite altered in part, arkosic-mafic-ultramafic schist
sequence with minor thin porphyry intrusives.
Multiple gold intercepts (including 4m @ 0.44 g/t Au from 106 metres) were recorded in 4 metre composite
samples collected from a weathered to fresh, silica-chlorite altered, sheared in part, minor quartz veined, mafic-
ultramafic units in hole 20GSYSAC0096. An unusually high gold anomaly was also recorded in the cover
sequence in this hole (6m @ 101ppb from 18 metres). Adjacent drillhole 20GSYSAC0103, collared 80 metres
to the east, recorded a shallow gold anomalous interval in a deeply weathered schistose horizon (4m @
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DIRECTORS’ REPORT
135ppb Au from 32m). Another anomalous gold interval in 20GSYSAC0095 (4m @ 81ppb Au from 75m) was
recorded in a weathered interpreted arkosic metasedimentary unit in close proximity to a granite contact to the
east and may represent a sheared metasedimentary-granite contact target corridor.
Drilling at this target also revealed an 800 x 1400 metre arsenic anomaly and some gold anomalism intersected
on the northern AC traverse. Preliminary petrological analysis of representative rock chips and end-of-hole air-
core has enhanced this interpretation and identified a tourmaline-quartz schist (hole 20GSYSAC0097) and a
foliated plagioclase-quartz-biotite schist (hole 20GSYSAC0102). Additional detailed lithology studies of drill
chips with arsenic and gold anomalism indicates an interpreted complex alteration history of a mafic precursor
rock type with widespread biotite mica alteration associated with localised smokey quartz and tourmaline vein
development. Silicification and quartz veining of the biotite mica schists was also observed with associated
pyrite and chlorite-sericite alteration.
Two reconnaissance drill-lines (with wide spaced nominal 160m centres) were completed on the northern
section of Target 2. Drilling revealed common amphibole-biotite-chlorite rich mafic-ultramafic types with minor
porphyry/granitoid intrusives. No significant gold intersections >50ppb were recorded on these two lines but
another pathfinder arsenic anomaly was recorded in one end of hole assay in hole 20GSYSAC0114 of 284ppb
arsenic on the southernmost of these two lines.
Target 3
Drilling consisted of 45 holes for a total advance of 2,972 metres. No significant bedrock gold intersections
were encountered at this target. However, several transported cover related gold occurrences are
considered anomalous (refer to ASX announcement dated 7 Sept 2020).
Detailed logging and follow-up microscope analysis revealed a sequence of mainly altered metasediments and
schists. In contrast, one petrological sample of note collected at the end of hole 20GSYSAC0155 (59 m depth)
is described as a foliated plagioclase-hornblende-zoisite-rock with opaques, interpreted as sulphides in a meta-
quartz diorite intrusive with anomalous arsenic. The presence of a quartz diorite intrusive rock containing
potential sulphide minerals is considered a high priority follow-up drill target.
Elevated gold results were all recorded in 6 metre composite samples in various horizons of the cover
sequence. The best result was returned in 20GSYSAC0134 (6m @ 147ppb Au from 6 metres downhole) in a
sand and clay horizon). These anomalous gold occurrences in the cover sequence require further investigation
for possible paleochannel potential.
Target 4
Two lines of angled air-core drilling on a broad 3.6km line spacing and 80m hole centres tested potential
greenstone sequences within Mallina Basin sediments, proximal to a secondary structure trending north-east
of the Yule River Shear Zone. 25 holes have been completed at this target for a total advance of 1,310 metres.
Drill logging recorded a shallower cover sequence consisting of transported sand, clay and silcreted and
calcrete sediments to approximately 15-20 metres. Bedrock geology logging recorded metasedimentary units
for the majority of holes along with some interpreted mafic-ultramafic schists and micro-granodioritic intrusive
rock types. Petrological analysis broadly agrees with this interpretation.
Numerous drill-holes (20GSYSAC0174-181) on the northern AC traverse recorded very fine to fine-grained
sulphide mineralisation presenting as irregular smeared foliation and disseminated pyrrhotite + pyrite - up to
5% and persistent silica-chlorite +/-biotite alteration mainly in the metasedimentary units. The most significant
gold anomalies were intersected in hole 20GSYSAC0177 where two separate intervals were recorded >50ppb
in saprolite interpreted to be a metasedimentary unit.
The best gold intersection on the southern AC traverse occurred in hole 20GSYSAC0186 (4m @ 0.13g/t from
28m). This intersection occurred in a weathered schistose, probable ultramafic sequence with -chlorite-biotite
alteration.
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DIRECTORS’ REPORT
Target 5
47 holes were completed at this target for a total advance of 2,575 metres (refer to Figure 5 and ASX
announcement dated 14 August 2020). Assay results revealed multiple elevated and anomalous gold
intersections of >10 ppb (20GSYSAC0062) recorded in an interpreted weathered mafic-ultramafic unit with
<2% fine grained, disseminated, and smeared foliation pyrite.
Detailed logging and petrological analysis from drill chips suggests metasedimentary and metamorphic
sequence interpretations. Importantly, a meta-quartz diorite intrusive was identified at the end of hole of
20GSYSAC0062 which coincides with the best intersection at this target where a broad, anomalous zone of
19m @ 91ppb Au from 46m including 4m at 350ppb Au from 58m occurred (Figure 5).
Once again, the presence of an interpreted diorite intrusive with broad and elevated gold intercepts is highly
encouraging and this target area is considered high priority for follow up drilling. The target area is open to the
east and the proposed drilling will focus on this corridor.
Figure 5: Target 5 collar location plan and significant results.
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DIRECTORS’ REPORT
New Target areas
A five kilometre structural corridor has been interpreted from the aeromagnetic data based on the drill results
from Target 1 (Figure 6). In addition, a broad target area to the east of Target 5 is interpreted as a continuation
of the prospective mafic-ultramafic package logged in this area.
Figure 6: New Interpreted Target Areas
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DIRECTORS’ REPORT
Yule Phase Two AC Program
A second phase of reconnaissance air-core drilling over a further 6 gold target areas on all the Yule tenements
E47/3503 & 3507 (referred to as Yule South) and E47/3508 (referred to as Yule North) was completed on 11
November 2020 with a total of 196 holes drilled for a total advance of 15,125 metres (Figure 7).
Phase two drilling returned several four-metre composite intervals greater than 0.1 ppm gold, recorded 39
holes or 20% of holes in the phase 2 program ending in anomalous or elevated gold and/or arsenic and
intersected numerous broad intervals of elevated gold values over downhole widths of 12 metres or more.
Figure 7: Collar and Target Location plan for Phase 1 & 2 programs.
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Yule South (E47/3503 & 3508)
Figure 8: Yule South collar location plan showing the sum of gold parts per billion x downhole metres (refer to GSM ASX
announcements dated 7 Sep 2020, 23 Sep 2020, 4 Dec 2020 & 17 Feb 2021).
Target 1 West
Drilling at this target was designed to test prospective structural and intrusive zones in this area. Twenty-one
holes were drilled at Target 1 West on four traverses for a total advance of 2,168 metres (Figure 8). The best
composite gold intersections included 4 metres @ 0.11g/t Au from 109 metres in hole 20GSYSAC0202 and 3
metres @ 0.10g/t Au from 113 metres in hole 20GSYSAC0203. These encouraging intersections were
accompanied by multiple intervals of elevated +10ppb gold.
Infill drillholes 20GSYSAC0300-301 (Figure 9) encountered silica and pyrite alteration and intersected zones
of elevated gold. 20GSYSAC0300 intersected a 48-metre interval of +10 ppb gold.
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Figure 9: Target 1 West section showing significant results over interpreted intrusive.
Two additional AC traverses (Figure 10) tested magnetic dislocations to a major north-south structure and
parallel demagnetised zones interpreted to represent localised alteration. Anomalous gold intersections
included 4 metres @ 0.10g/t Au from 94 metres in hole 20GSYSAC0214 and 4 metres @ 0.10g/t Au from 32
metres in hole 20GSYSAC0215.
Figure 10: Target 1 West plan showing significant assay results.
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Two infill holes (20GSYSAC0300-301) on 80 metre centres drilled either side of hole 20GSYSAC0202
encountered similar silica and pyrite alteration of metasedimentary rocks and intersected zones of elevated
gold. 20GSYSAC0300 intersected a 48 metre interval of +10 ppb gold hosted in a chlorite altered and iron-
stained saprolite sequence interpreted as a metasediment unit.
Two more east-west 320 metre spaced AC traverses tested dislocations to a major north-south structure and
parallel demagnetised zones interpreted to represent localised alteration. Two more notable gold intersections
included 4 metres @ 0.10g/t Au from 94 metres in hole
Target 2
Twelve additional holes were drilled between existing traverses at Target 2A for a total advance of 722 metres.
More end of hole (‘EOH’) arsenic anomalies were recorded which will aid target vectoring.
Fourteen holes were drilled on three east-west traverses at Target 2B (Figure 8) for a total advance of 859
metres. No significant gold intersections were encountered in these traverses, however multiple EOH +50ppm
arsenic anomalies were recorded including 1 metre @ 666 ppm from 40 meters in hole 20GSYSAC0273.
Target 3
Thirty-six holes were drilled on six additional traverses at Target 3A (Figure 8) for a total advance of 2,159
metres. The best gold intersection was encountered in hole 20GSYSAC0226 with 4 metres @ 50ppb from 50
metres.
Six holes were also drilled on a single north-north-west trending traverse at Target 3B for a total advance of
482 metres. The most notable intersection was recorded in hole 20GSYSAC0241 with a broad elevated gold
interval of 23 metres @ 29ppb from 30 metres and a single metre +50ppm arsenic anomaly at the EOH (74-
75m).
Target 4
Six holes were drilled on two east north-east traverses at this target for a total advance of 602 metres. Subtle,
elevated intersections were recorded in 20GSYSAC0291 (12 metre interval of elevated +30ppb gold from 36
metres) and a +50ppm end of hole arsenic anomaly from 155 metres. Another low-level interval was recorded
in hole 20GSYSAC0293 (48 metre interval of elevated gold +10ppb encountered from 69 metres including 4
metres @ 55ppb from 85 metres).
The most notable gold intersection recorded in the cover sequence was a +50ppb interval recorded in hole
20GSYSAC0290.
Target 6
An interpreted structural intersection of north and north-west trending contact zones was targeted in this area
along strike of the promising indicators from Target 5 drilled from the Phase 1 program. Five holes
(20GSYSAC0295-299) were drilled here (Figure 8) for a total of advance of 488 metres on an east north-east
trending single traverse. Field logging recorded bedrock geology consisting of mainly metasedimentary
sequence with some possible minor mafic units. No significant gold intersections were encountered at this
target although multiple intervals of elevated +10ppb gold were recorded including one twelve metre interval
in hole 20GSYSAC0296.
.
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Yule North (E47/3508)
TARGET 1
QUARRY
WELL
EAST
Figure 11: Yule North collar location plan showing the sum of gold parts per billion x downhole metres (refer to GSM ASX
announcements dated 4 Dec 2020 & 17 Feb 2021).
Target 1 Quarry Well
The Quarry Well area (Figure 11) is interpreted as a strongly deformed aeromagnetic target related to a granite
contact zone along the southern edge of the Sholl Shear Zone (“SSZ”). Twenty-nine holes (20GSYNAC0001-
0029) were drilled on three ~1,000 metre spaced traverses for a total advance of 1,571 metres. Field logging
recorded a cover sequence consisting of transported sand, clay and silcreted and calcrete sediments to
approximately thirty metres. The best gold intersection within the cover sequence was a six-metre interval with
63ppb gold from six metres in hole 20GSYSAC0002 within part gritty silcrete/rubbly calcrete horizons. Bedrock
geology consisted of a range of variably weathered ultramafic rock types with minor schist and chert units.
Multiple elevated +10ppb gold intersections were initially reported from this target, two of which occurred in
fresh rock at the EOH. The most notable occurred in a chert unit in hole 20GSYNAC0024 with a +50ppb
interval recorded from thirty-four metres.
Quarry Well East
Drilling at this structural target was designed to test a dislocated zone within the SSZ. Six holes were drilled at
160 metre centres on one AC traverse for a total advance of 323 metres. Field logging recorded a slightly
deeper cover sequence consisting of transported ferruginous sand, calcrete sediments and conglomeratic
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Golden State Mining Limited
30 JUNE 2021
DIRECTORS’ REPORT
nodules to approximately 35 metres. Bedrock geology consisted of silicified mafic rock types containing
variable quartz veining and possible hematite alteration. The best composite gold intersection occurred in the
alluvial cover with 6m @ 0.18g/t Au from 6 metres downhole hosted in sandy calcrete with conglomeratic
nodules at the bottom of the interval.
Target 2
This area marks a major dislocation and fault intersection within the SSZ comprising complex, fractured and
altered relict greenstones. Eighteen holes (20GSYSAC0036-53) were drilled on two ~500 metre spaced east-
north-east traverses for a total advance of 1,681 metres. Bedrock geology consisted of granitic, intermediate
and felsic units. No significant +50ppb gold intersections were encountered at this target.
Target 3
Aeromagnetic interpretation of the Balla Yule Prospect indicated a complex structural gold target on the
eastern part of the intrusive units. Fifteen holes drilled on two N-S traverses for a total advance of 1,281 metres.
Field logging recorded bedrock geology consisting of mainly granitic and ultramafic units. An additional east-
west traverse was drilled 2.5 kilometres to the south-east of Balla Yule over a structural flexure along the SSZ.
Six holes (20GSYSAC0069-74) were drilled for a total advance of 451 metres. No significant gold or base
metal values were encountered at these targets.
Target 4
Three discrete traverses were drilled in this area testing various areas of a structurally complex zone of
interpreted fracturing and folding with potential alteration and intrusive zones. Twenty holes (20GSYNAC0075-
94) for a total advance of 2,143 metres.
The southernmost east-west traverse at target 4A target delivered the most encouraging results at Target 4
from another structural break in the SSZ. Several intercepts of elevated gold were recorded over this target
with the most notable occurring in hole 20GSYSAC0092 over an 18 metre interval from six metres hosted
within a gritty calcrete horizon. Bedrock geology consists of granitic rocks on the western end proceeded by
ultramafic and mafic schist units to the east. The best bedrock gold intersection occurred at the contact of a
mafic schist and a silica altered ultramafic unit in hole 20GSYNAC0088 with 1 metre @ 0.11g/t from 93 metres
within a 20m interval of +30ppb elevated gold from 89 metres.
Another broad interval of elevated gold was also encountered at Target 4A in hole 20GSYSAC0091 over 40
metres from 51 metres including a 4 metre +50ppb interval from 83 metres. Numerous other +10ppb gold
intervals were recorded including one end of hole sample in hole 20GSYNAC0094 from 139 metres.
The central NW trending traverse at Target 4B targeted elliptical high magnetic feature straddling an
interpreted late Proterozoic dyke. No significant gold intersections were recorded although multiple +10ppb
gold values were recorded in six metre composite sample intervals in the three holes to the north-western end
of this traverse.
The northern north-south trending traverse at Target 4B targeted a low magnetic feature off the main SSZ.
Field logging recorded a possibly transported cover sequence consisting of alluvial sand, calcrete sediments
and lateritic nodules and pebbles to approximately 95 metres. Only one hole intersected bedrock which was
recorded as a granitic intrusive. Consequently, only two holes were drilled on this traverse with no significant
gold intersections.
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30 JUNE 2021
DIRECTORS’ REPORT
Figure 12: Yule geological plan showing drill target areas (refer to GSM ASX announcements dated 7 Sep 2020, 23 Sep 2020,
4 Dec 2020 & 17 Feb 2021).
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30 JUNE 2021
DIRECTORS’ REPORT
Yule East E45/5570 100% GSM
A review of open file aeromagnetic data over an exploration license application (refer to ASX announcement
dated 8 January 2020) to the east of the Yule project tenements was completed by Core Geophysics Pty Ltd
(Figure 13).
Figure 13: Exploration license application E45/5570 aeromagnetic interpretation and target areas
Numerous intrusive style targets and prospective structural settings and corridors (Figure 14) have been
identified and prioritised for the 2021 field season. The new targets will compliment previously identified targets
along the Yule River Shear Zone (“YRSZ”) within the tenement area.
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DIRECTORS’ REPORT
Figure 14: Yule East E45/5570 priority target areas for air-core drilling in 2021 (refer to GSM ASX announcements dated 4 Dec 2020 &
17 Feb 2021 & Troy Resources Limited ASX announcement dated 29 April 2005).
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30 JUNE 2021
DIRECTORS’ REPORT
Exploration License E47/4343
An exploration license application (refer to ASX announcement dated 12 February 2020) for additional
prospective ground to the east of the current Yule North tenement was granted during the reporting period.
E47/4343 provides an extension of the Boodarie Greenstone Belt within the SSZ and an interpreted intrusive-
style setting. Open file drilling report data has recorded only limited (4 drillholes), base-metal focused historic
drilling within this tenement.
Figure 15: Core Geophysics Interpretation and targets over E47/4343
Four targets have been identified by Core Geophysics (Figure 15), all of which are considered primarily
prospective for gold.
Target C11
An interpreted ultramafic unit displaying possible magnetic destruction due to structural deformation or
potentially chemical alteration at a point of flexure.
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30 JUNE 2021
DIRECTORS’ REPORT
Target C12
A broad zone of generally non-magnetic stratigraphy i.e., mafics, volcaniclastics, felsics and sediments,
proximal to a point of inflexion. This location between two interpreted granitic intrusives is considered
favourable for deformation and a fluid focus trap site.
Target C13
Zone of low stress resulting from the intrusion of an interpreted granite pluton (‘G2’) at its north-western margin.
This area shows dislocation of south-west trending shears of the SSZ which may favour dilatant brittle
deformation and subsequent accumulation of mineralising fluids.
Target C14
Similar interpreted zone of potential low stress produced when intrusion of G2 caused warping of regional
north-northeast and west-northwest structures at its south-eastern margin.
Yule North
Quarry Well VHMS Pathfinders
At the Quarry Well prospect, located on the Sholl Shear Zone (“SSZ”) field logging recorded similar chert
intervals in holes 20GSYNAC0008 & 15 (Figure 16). These chert intervals were recorded within a strongly
sheared and hydrothermally altered mafic package consisting of quartz-sericite-pyrite schists with elevated
zinc and lead portable X-ray fluorescent (“pXRF”) readings up to approximately 0.25%.
The Company also noted that a historic VTEM anomaly was also found in the vicinity and therefore the
prospect may have some VHMS prospectivity. Further work has revealed a series of holes with elevated zinc,
lead, manganese and silver accompanied by an interpreted distal alteration halo.
Based on this work, target selection will now focus on untested magnetic and non-magnetic conductive sources
that may represent valid VHMS targets within the SSZ.
Figure 16: Quarry Well collar location plan showing holes with VHMS pathfinder anomalies.
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30 JUNE 2021
DIRECTORS’ REPORT
Geophysical Data Acquisition and Reprocessing
Figure 17: Yule Project plan showing detail of recently acquired Magnetic data overlaying GSM tenements.
GSM purchased an aeromagnetic dataset (Reg. number 60884) held under a multi-client license agreement
by Core Geophysics Pty Ltd (Core Geophysics). This aeromagnetic survey (100-metre spaced) was flown by
Fugro Airborne Surveys in 2006. The dataset (Figure 17) will provide far greater resolution from which to
interpret additional structurally hosted gold targets with a focus on intrusive environments.
Core Geophysics merged the multi-client aeromagnetic data with GSM’s existing open file dataset and use
this combined data to produce an enhanced geological interpretation. This study will focus on any structural
environments favourable for the development of intrusive style settings, in addition to extensions of mineralised
structures intersected in the Phase 1 program.
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30 JUNE 2021
DIRECTORS’ REPORT
Yule Project Gold and Lithium RC Drill Campaigns
Gold and Lithium Drill Targeting
The company provided an update on the status of its planned drilling activities for 2021 (refer to ASX
announcement dated 17 February 2021). A summary is provided below. Further technical commentary was
provided in Appendices 1 & 2 of ASX announcement dated 17 February 2021 and 13 July 2021.
Gold-only targets - 3,542m RC Drill program
An initial 3,542-metre follow-up reverse circulation (“RC”) program commenced and was completed after the
end of the financial year at three gold-only targets (Figure 18) generated from the Phase 1 and 2 air-core
(“AC”) drill program (refer to ASX announcement dated 20 August 2021). The three targets drilled were Target
1 East, Target 1 West and Target 5, all at Yule South and summarised above.
All samples have now been sent for analysis at a laboratory in Perth and the Company awaits the results.
There is currently a long waiting period for assay results due to the significant level of activity in the resources
sector.
Further RC-drilling for gold and lithium is also planned for Yule South at Target 2A, where there is a large,
800m x 1400m arsenic anomaly and gold anomalism (refer to Yule South Target 2 information above).
LCT Pegmatite Targeting - 1,500m RC Drill Program
Four Lithium-caesium-tantalum (“LCT”) pegmatite targets (Figure 19) have been generated based on known
lithium pathfinder analysis identified from the Phase 1 and 2 AC program results from 2020. Statutory approvals
have been received for the 1,500 metre RC program designed to these target areas and the commencement
of the program is now subject to drill rig and manning availability, with a heritage survey having been completed
following the end of the financial year. Further technical commentary was provided in Appendix 2 of ASX
announcement dated 17 February 2021.
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Golden State Mining Limited
30 JUNE 2021
DIRECTORS’ REPORT
Figure 19: Lithium target locations over structural framework interpretation of basement rock units.
Murchison – 100% GSM
Mining Agreement
An agreement was signed (refer to ASX announcements dated 19 June 2020 and 18 December 2020) with
Adaman Resources Pty Ltd (“Adaman”) to purchase, mine and process remnant mine tailings (battery sands)
from GSM’s historic Cue No. 1 and Salisbury mines. Adaman completed processing the sands at its Kirkalocka
Gold Mine processing plant during the March quarter 2021.
GSM noted that on 1 May 2021, administrators were appointed to Adaman and its subsidiaries (refer to ASX
announcement dated 6 May 2021).
Based on the outcomes of creditors meetings and correspondence of Adaman’s administrators, the Company
expects to receive only a negligible return as a creditor of Adaman in relation to the ore purchase agreement.
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Golden State Mining Limited
30 JUNE 2021
DIRECTORS’ REPORT
Four Mile Well – 100% GSM
Figure 20: Four Mile Well Project near Laverton.
The company continues to evaluate drill target opportunities over untested historic geochemical anomalies
and granite-greenstone contacts within the project area (Figure 20). The company is also focussing on the
northern end of the tenement where the greenstone units disappear under deeper sand cover. These
greenstone units are potential gold targets as they host ferruginous chert /BIF units. Previous geochemical
sampling over this area may have been ineffective here due to the depth of overlying cover or lack of
geochemical signature from the target lithologies.
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Golden State Mining Limited
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DIRECTORS’ REPORT
Figure 21: Four Mile Well Project showing location tenement applications over geochemical anomaly.
The Company applied for two additional exploration licenses at its wholly owned Four Mile Well project near
Laverton. The tenement applications (Figure 21), encompass a geochemical anomaly recently identified during
a review of historic geochemical datasets.
In 1988, Western Mining Corporation (“WMC”) completed a soil/lag geochemical survey over the northern part
of GSM’s current tenure and beyond, testing north-west striking banded iron formation and mafic xenoliths
under extensive windblown sand cover. Initial results produced several anomalous gold responses but follow
up infill sampling failed to reproduce the initial results. The veracity of the original results was questioned, and
the tenement was subsequently relinquished.
GSM completed a detailed review of this dataset to check WMC’s findings and to evaluate if any follow up
geochemical sampling was required. The extra processing has highlighted a previously unrecognised
anomalous response in the historic data revealing an encouraging Arsenic-Bismuth - low level gold anomaly
on the northern boundary of GSM’s current tenure. The geochemical anomaly is interpreted to extend
eastwards.
Fieldwork is expected to commence once the tenement applications have been granted.
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Golden State Mining Limited
30 JUNE 2021
DIRECTORS’ REPORT
Corporate
As part of a $2.2 million placement announced on 21 May 2020, the Company finalised its second tranche of
that placement on 6 July 2020 to raise $1,056,250 (before costs) through the issue of 8,450,000 million new
shares at 12.5 cents per share.
During the year the Company further raised approximately $3.2 million (before costs) in a placement to
sophisticated and professional investors through the issue of up to 25,680,000 million new shares at 12.5 cents
per share. The placement was divided into two tranches: the first tranche raising approximately $1.7 million
(before costs) in March 2021 using the company’s pre-existing 15% and 10% placement capacities under
listing rules 7.1 and 7.1A; and the second tranche, which was subject to shareholder approval, raising
$1.5 million (before costs) in April 2021.
On 19 February 2021, the Company issued 432,158 fully paid ordinary shares at $0.165 per share to satisfy
an invoice for the cost of drilling services provided to the Company to the value of $71,400.
During the year the Company raised an additional $257,500 through the exercise of 1,460,000 options with
various exercise price ranges between $0.1625 to $0.25 per share.
RESULTS OF OPERATIONS
Revenues and results
A summary of the Group’s revenues and results for the period is set out below:
Consolidated entity revenues and (loss)
June 2021
$
June 2020
$
Revenues
1,018,065
Results
(3,139,752)
Revenues
71,010
Results
(1,663,463)
CORONAVIRUS (COVID-19) PANDEMIC
The Group has exercised judgement in considering the impacts of COVID-19 since the World Health
Organisation declared the outbreak a pandemic in March 2020. As all the Group’s tenements are located in
Western Australia there has been little impact on access to tenements.
SHARES
There were 82,748,358 fully paid ordinary shares outstanding as at 30 June 2021. No shares were issued after
balance date.
As at the date of this report there are 82,748,358 fully paid ordinary shares outstanding.
On 30 August 2021, 81,554 fully paid ordinary shares were proposed to be issued on about 29 October 2021
at $0.125 per share to satisfy an invoice for the cost of earth works for drilling provided to the Company.
On 22 September 2021, 258,073 fully paid ordinary shares were proposed to be issued on about 29 October
2021, to satisfy certain royalty obligations in respect of the Cue Project.
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Golden State Mining Limited
30 JUNE 2021
DIRECTORS’ REPORT
OPTIONS
There were 17,172,560 options outstanding as at 30 June 2021, all of which are unlisted.
Number
Class
1,722,560 Unlisted options ($0.25 for GSM, Expire 26 Oct 2022)
1,000,000 Unlisted options ($0.35 for GSM, Expire 8 Nov 2021)
5,300,000 Unlisted options ($0.25 for GSM, Expire 8 Nov 2021)
3,000,000 Unlisted options ($0.1625 for GSM, Expire 26 Jun 2023)
3,200,000 Unlisted options ($0.40 for GSM, Expire 30 Sep 2024)
2,950,000 Unlisted options ($0.60 for GSM, Expire 30 Sep 2024)
Since the end of the financial year, a total of 200,000 options ($0.25, Expire 26 Oct 2022) were issued on 20
July 2021, and as at the date of this report there are 17,372,560 options outstanding.
The number of Directors’ Meetings held during the year and the number of meetings attended by each
Director is as follows:
Director
Michael Moore
Damien Kelly
Greg Hancock
Brenton Siggs
Board meetings
Attended
Entitled to Attend
6
6
6
6
6
6
6
6
The full board discharged the functions of the audit, remuneration, risk and nomination committees regularly
and during the course of ordinary director meetings.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied for leave of court to bring proceedings on behalf of the company or intervene in any
proceedings to which the company is a party for the purpose of taking responsibility on behalf of the company
for all or any part of those proceedings. The company was not a party to any such proceedings during the
year.
CORPORATE STRUCTURE
Golden State Mining Limited is a company limited by shares that is incorporated and domiciled in Australia.
PERFORMANCE RIGHTS
There are nil performance rights on issue at the date of this report.
RISK MANAGEMENT
The board is responsible for ensuring that risks, and also opportunities, are identified on a timely basis and
that activities are aligned with the risks and opportunities identified by the board.
The board believes that it is crucial for all board members to be a part of this process, and, accordingly, all
board members form, and discharge the obligations of the risk management committee.
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Golden State Mining Limited
30 JUNE 2021
DIRECTORS’ REPORT
The board has a number of mechanisms in place to ensure that management's objectives and activities are
aligned with the risks identified by the board. These include implementation of board approved operating plans
and budgets and board monitoring of progress against these budgets.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Other than as disclosed in this Annual Report, no significant changes in the state of affairs of the Group
occurred during the financial year.
SIGNIFICANT EVENTS AFTER THE BALANCE DATE
Since the reporting date, on 20 July 2021, 200,000 unlisted $0.25 options (expiry 26 Oct 2022) were issued to
a consultant as part consideration for services. In addition on 30 August 2021, the Company proposed to issue
81,554 fully paid ordinary shares on 29 October 2021 to satisfy an invoice for the cost of earth works for drilling
provided to the Company; and on 22 September the Company proposed to issue 258,073 fully paid ordinary
shares on 29 October 2021 to satisfy certain royalty obligations in respect of the Cue Project.
On 27 July 2021, the Company announced (and has since completed) the sale of an 80% interest in its
Cuddingwarra and Big Bell South Gold projects to Caprice Resources Limited (ASX: CRS). The Company
retains 20% ownership in the projects, forming a Joint Venture (‘JV’) with Caprice Resources Limited.
Key terms of the acquisition and JV are summarised as follows:
•
In consideration for the acquisition, the Company received from Caprice on 2 August 2021:
➢ 2,500,000 fully paid ordinary shares in the capital of Caprice,
➢ a $200,000 cash payment ($30,000 of which was received as a deposit prior to balance date), and
➢ 250,000 options in Caprice with an exercise price of $0.25 per option and expiring 3 years from
the date of issue (subject to a 3 day VWAP of less than $0.23 prior to completion).
• The Company’s 20% ownership over the projects and will be free-carried through to completion of a
pre-feasibility study, after which point GSM can elect to contribute or dilute.
• Should Company elect to dilute below 10% project ownership its interest will convert into a 2% Net
Smelter Royalty (NSR) royalty, with Caprice able to buy-back the royalty for a cash payment of
$5,000,000.
• Caprice has first right of refusal should the Company elect to dispose of its project ownership.
• Caprice to operate and manage the JV.
No other matter or circumstance has arisen since 30 June 2021, which has significantly affected, or may
significantly affect the operations of the Group, the result of those operations, or the state of affairs of the
Group in subsequent financial years.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
The Group intends to continue to undertake appropriate levels of exploration of its tenement portfolio, and to
seek new project opportunities.
Other than as set out above, likely developments in the operations of the Group and the expected results of
those operations in future financial years have not been included in this report as the directors believe, on
reasonable grounds, that the inclusion of such information would be likely to result in unreasonable prejudice
to the Group.
ENVIRONMENTAL REGULATION AND PERFORMANCE
The Group is subject to environmental regulation in respect to its activities.
The Group aims to ensure the appropriate standard of environmental care is achieved, and in doing so, that it
is aware of and complies with all environmental legislation. The directors of the Company are not aware of any
breach of environmental legislation for the year under review.
REMUNERATION REPORT (AUDITED)
The information provided in this remuneration report has been audited as required by section 308(3C) of the
Corporations Act 2001.
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Golden State Mining Limited
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DIRECTORS’ REPORT
Policy principles used/to be used to determine the nature and amount of remuneration.
Remuneration Policy
The remuneration policy of Golden State Mining Limited is designed to align key management personnel
objectives with shareholder and business objectives by providing a fixed remuneration component. The board
of Golden State Mining Limited believes the remuneration policy for the year under review was appropriate
and effective to attract and retain suitable key management personnel to run and manage the Group.
Consideration has been and will continue to be given to offering specific short and long term incentives
including, specifically, equity remuneration.
The remuneration policy, setting the terms and conditions for the executive directors and other senior
executives (if any), was developed by the board. In general, in respect of the year under review, executives
received a base salary (which was based on factors such as experience), superannuation and share-based
payments. The board will review executive packages as and when it considers it appropriate to do so in
accordance with its remuneration policy and by reference to the Group’s performance, executive performance
and comparable information from industry sectors and other listed companies in similar industries.
The board may exercise discretion in relation to approving incentives, bonuses and equity remuneration. The
policy is to reward executives for performance that results in long-term growth in shareholder wealth.
The executive directors and executives receive, where required by law, a superannuation guarantee
contribution required by the government of Australia, which was 9.5% for the 2021 financial year but are not
entitled to receive any other retirement benefits.
All remuneration paid to directors and executives is “valued” at the cost to the Group and expensed. Where
applicable, options granted as equity remuneration are ascribed a “fair value” in accordance with Australian
Accounting Standards.
The board’s 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 the
policy is to effect reviews of remuneration annually, based on market practice, duties and accountability. Fees
for non-executive directors are not linked to the performance of the Group. However, to align directors’ interests
with shareholder interests, the directors are encouraged to hold shares in the Company and are able to
participate in equity remuneration arrangements.
Company performance, shareholder wealth and key management personnel remuneration
There is no relationship between the financial performance of the Company for the current or previous financial
year and the remuneration of the key management personnel. Remuneration is set having regard to market
conditions and to encourage continued services of key management personnel.
Use of remuneration consultants
No remuneration consultant made a remuneration recommendation in relation to any of the key management
personnel for the Group for the financial year.
Key management personnel of the Group
The Key Management Personnel (KMP) of the Group was comprised of all the board of directors mentioned
above and Mr Moore is the sole Executive Director.
Details of the remuneration of the directors and the key management personnel of the Group are set out in the
following tables:
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Golden State Mining Limited
30 JUNE 2021
DIRECTORS’ REPORT
2021
Short term
Post
Director
Base
Salary & Other Fees
$
Employment
Superannuation
$
Share-Based Payments
$
Total
$
Michael Moore
Damien Kelly
Greg Hancock
Brenton Siggs
Total
180,000
50,000
30,000
30,000
290,000
17,100
4,750
-
2,850
24,700
170,815
367,915
136,652
191,402
91,101
121,101
91,101
123,951
489,669
804,369
2020
Short term
Post
Director
Base
Salary & Other Fees
$
Employment
Superannuation
$
Share-Based Payments
$
Total
$
Michael Moore
Damien Kelly
Greg Hancock
Brenton Siggs
Janet Wicks1
Total
180,000
50,000
30,000
30,000
17,500
307,500
17,100
4,750
-
2,850
-
24,700
-
-
-
-
-
-
197,100
54,750
30,000
32,850
17,500
332,200
1Balance as at Janet Wicks resignation as a director on 10 December 2019. The board agreed to pay Janet Wick’s director
fees up to 31 January 2020.
Written Service agreements
Michael Moore, Managing Director:
An employment agreement has been executed between the Company and Mr Moore. Material provisions of
the agreement were as follows for the financial year:
• Term of agreement – The contract has no fixed term. It may be terminated without reason by the
company by giving 3 months’ written notice and 3 months payment or, at the Company’s election,
payment of the 6 months’ notice period in lieu of notice. The Executive may terminate the employment
without reason by giving 3 months written notice.
• Monthly package of $15,000 plus statutory superannuation.
Since the end of the financial year, the Company has agreed to increase Mr Moore’s monthly remuneration to
$18,750 plus statutory superannuation and for the Company to be able to terminate without reason by giving
3 months’ written notice or, at the Company’s election, payment of the 3 months’ notice period in lieu of notice.
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Golden State Mining Limited
30 JUNE 2021
DIRECTORS’ REPORT
Damien Kelly, Non-Executive Chairman:
• Term of agreement – Subject to retirement by rotation under the Company’s Constitution.
• Monthly package of $4,167 plus statutory superannuation (if applicable). Since the end of the financial
year the Company has agreed to increase the monthly package to $5,000 plus statutory
superannuation (if applicable).
Brenton Siggs (Non-Executive Director), Greg Hancock (Non-Executive Director) and Janet Wicks
(Non-Executive Director; resigned as a director 10 Dec 2019):
• Term of agreement – Subject to retirement by rotation under the Company’s Constitution.
• Monthly package of $2,500 plus statutory superannuation (if applicable). Since the end of the financial
year the Company has agreed to increase the monthly package to $3,000 plus statutory
superannuation (if applicable).
Share holdings
The relevant interest held during the financial year by each KMP, including their personally related parties, is
set out below. No shares were issued as compensation during the reporting period.
Fully paid ordinary shares
30 June 2021
Balance at start
of the period
Granted during
the year as
compensation
Other changes
during the year
Balance at end of the
period
Michael Moore
1,625,100
Damien Kelly
1,510,100
Greg Hancock
-
Brenton Siggs
660,000
Total
3,795,200
-
-
-
-
-
-
-
-
-
-
1,625,100
1,510,100
-
660,000
3,795,200
Option holdings
The relevant interest in options over ordinary shares in the Company held during the financial year by each
director of Golden State Mining Limited and other key management personnel of the Group is set out below.
Unlisted options
30 June
2021
Michael
Moore
Damien
Kelly
Greg
Hancock
Brenton
Siggs
Balance at
start of the
year
Granted as
compensation
1,500,000
1,500,000
1,500,000
1,200,000
500,000
800,000
750,000
800,000
Total
4,250,000
4,300,000
Exercised
Lapsed
Other
changes
Balance at
end of the
year
Vested and
exercisable
Unvested
-
-
-
-
-
-
-
-
-
-
- 3,000,000 2,250,000
750,000
- 2,700,000 2,100,000
600,000
- 1,300,000
900,000
400,000
- 1,550,000 1,150,000
400,000
- 8,550,000 6,400,000 2,150,000
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Golden State Mining Limited
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DIRECTORS’ REPORT
Other equity-related KMP transactions
There have been no other transactions during the financial year involving equity instruments apart from those
described in the tables above relating to options, rights and shareholdings.
Loans to key management personnel
There were no loans to key management personnel during the year.
Other transactions with key management personnel
Transactions between related parties are on normal commercial terms and conditions no more favourable than
those available to third parties unless otherwise stated. Refer to note 22: Related Party Transactions.
INSURANCE OF DIRECTORS AND OFFICERS
During or since the financial year, in accordance with each director’s Deed of Indemnity, Insurance and Access
with Golden State Mining Limited, the Group has paid premiums insuring all the directors of Golden State
Mining Limited, to the extent permitted by law, against all liabilities incurred by the director acting directly or
indirectly as a director of the Company. The cover extends to legal costs incurred by the director in defending
proceedings, provided that the liabilities for which the director is to be insured do not arise out of conduct
involving a wilful breach of the director’s duty to the Company or a contravention of sections 182 or 183 of the
Corporations Act 2001.The total amount of Directors and Officers insurance premiums paid is $24,420 (2020:
$21,090).
The table below sets out summary information about the Group’s earnings and movements in
shareholder wealth for the two (2) years to 30 June 2021:
30 June 2021
$
30 June 2020
$
Other income
Net loss before tax
Net loss after tax
Share price at start of the year
Share price at end of the year
Basic/diluted loss per share (cents)
1,018,065
3,139,752
3,139,752
0.57
0.14
(4.96)
END OF REMUNERATION REPORT (AUDITED)
71,010
1,663,463
1,663,463
0.075
0.57
(4.46)
NON-AUDIT SERVICES
Details of amounts paid or payable to the auditor for non-audit services provided during the year by the auditor
are outlined in note 16 to the financial statements.
In the event non-audit services are provided by Stantons, the Board has established precedence to ensure
that the provision of non-audit services is compatible with the general standard of independence for auditors
imposed by the Corporations Act 2001. These include:
• all non-audit services are reviewed and approved to ensure that they do not impact the integrity and
objectivity of the auditor; and
• non-audit services do not undermine the general principles relating to auditor independence as set out
in APES 110 ‘Code of Ethics for Professional Accountants’ issued by the Accounting Professional &
Ethical Standards Board, including reviewing or auditing the auditor’s own work, acting in a
management or decision-making capacity for the Company, acting as advocate for the Company or
jointly sharing economic risks and rewards.
37
Golden State Mining Limited
30 JUNE 2021
DIRECTORS’ REPORT
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001
is set out on page 39.
Signed in accordance with a resolution of the Directors.
Michael Moore
Managing Director
29 September 2021
38
PO Box 1908
West Perth WA 6872
Australia
Level 2, 1 Walker Avenue
West Perth WA 6005
Australia
Tel: +61 8 9481 3188
Fax: +61 8 9321 1204
ABN: 84 144 581 519
www.stantons.com.au
29 September 2021
Board of Directors
Golden State Mining Limited
Suite 14, 19/21 Outram Street
WEST PERTH, WA 6005
Dear Directors
RE:
GOLDEN STATE MINING LIMITED
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of Golden State Mining Limited.
As Audit Director for the audit of the financial statements of Golden State Mining Limited for the year
ended 30 June 2021, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
(i)
(ii)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
any applicable code of professional conduct in relation to the audit.
Yours faithfully
STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD
Samir Tirodkar
Director
Liability limited by a scheme approved under Professional Standards Legislation
Stantons Is a member of the Russell
Bedford International network of firms
Golden State Mining Limited
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2021
REVENUE
Interest revenue
Other income
Gain on Sale of Asset
EXPENDITURE
Administration expense
Bad debt expense
Depreciation expense
Exploration and tenement expense written off
Share-based payments expense
Employee benefits expense
(LOSS) BEFORE INCOME TAX
Income tax benefit/(expense)
Year
30 June 2021
Year
30 June 2020
Notes
$
$
9
20
11
17
11,785
1,004,749
1,531
(404,145)
(712,758)
(50,778)
(1,675,389)
(713,186)
(601,561)
25,081
45,929
-
(241,450)
-
(108,165)
(686,038)
(105,000)
(593,820)
(3,139,752)
(1,663,463)
-
-
(LOSS) FOR THE YEAR ATTRIBUTABLE TO
MEMBERS OF GOLDEN STATE MINING LIMITED
(3,139,752)
(1,663,463)
OTHER COMPREHENSIVE INCOME
Items that may be reclassified to profit or loss
-
-
Other comprehensive (loss) for the period, net of tax
(3,139,752)
(1,663,463)
TOTAL COMPREHENSIVE (LOSS) FOR THE
PERIOD ATTRIBUTABLE TO MEMBERS OF
GOLDEN STATE MINING LIMITED
(3,139,752)
(1,663,463)
Basic and diluted (loss) per share (cents)
21
(4.96)
(4.46)
The above consolidated statement of profit or loss and other comprehensive income should be read in
conjunction with the accompanying notes.
40
Golden State Mining Limited
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2021
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Accrued income
Prepayments
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Security deposit
Property, plant and equipment
TOTAL NON-CURRENT ASSSETS
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
Reserves
Accumulated losses
TOTAL EQUITY
30 June
30 June
Notes
2021
$
2020
$
3
4
5
6
20
7
8
8
4,376,053
2,435,260
30,906
2,329
6,645
32,808
1,404
-
4,415,933
2,469,472
-
89,037
89,037
2,640
128,859
131,499
4,504,970
2,600,971
222,908
80,859
303,767
249,184
49,133
298,317
188,864
188,864
188,864
188,864
492,631
487,181
4,012,339
2,113,790
10
10
13
10,760,747
1,369,886
6,435,632
716,780
(8,118,294)
(5,038,622)
4,012,339
2,113,790
The above consolidated statement of financial position should be read in conjunction with the accompanying
notes.
41
Golden State Mining Limited
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2021
Contributed
Equity
$
Reserves
$
Accumulated
Losses
$
Total
$
BALANCE AT 1 JULY 2019
5,196,031
600,943
(3,409,322)
2,387,652
Loss for the period
TOTAL COMPREHENSIVE
(LOSS)
INCOME
TRANSACTIONS WITH OWNERS IN
THEIR CAPACITY AS OWNERS
-
-
-
(1,663,463)
(1,663,463)
-
(1,663,463)
(1,663,463)
Expired Options
-
(34,163)
34,163
-
Share-based payments – Drilling services
30,000
-
Share-based payments – Lead managers
-
150,000
Proceeds from issue of shares
Proceeds from shares to be issued
Proceeds from exercise of options
Securities issue costs
1,143,750
50,000
230,000
(214,149)
-
-
-
-
-
-
-
-
-
-
30,000
150,000
1,143,750
50,000
230,000
(214,149)
BALANCE AT 30 JUNE 2020
6,435,632
716,780 (5,038,622)
2,113,790
BALANCE AT 1 JULY 2020
6,435,632
716,780
(5,038,622)
2,113,790
Loss for the period
TOTAL COMPREHENSIVE
(LOSS)
INCOME
TRANSACTIONS WITH OWNERS IN
THEIR CAPACITY AS OWNERS
Share-based payments
Exercised share-based payments options
-
-
-
-
Proceeds from issue of shares
Drilling costs paid in shares
Proceeds from exercise of options
Securities issue costs
4,256,250
71,400
217,500
(220,035)
-
(3,139,752)
(3,139,752)
-
(3,139,752)
(3,139,752)
713,186
(60,080)
-
-
-
-
-
713,186
60,080
-
-
-
-
-
4,256,250
71,400
217,500
(220,035)
BALANCE AT 30 JUNE 2021
10,760,747
1,369,886 (8,118,294)
4,012,339
The above consolidated statement of changes in equity should be read in conjunction with the accompanying
notes.
42
Golden State Mining Limited
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Other income
Interest received
Payments to suppliers and employees
Net cash (used in) operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Proceed from sale of tenements
Proceeds from sale of plant and equipment
Payments for plant and equipment
Refund for Office Security Bond
Net cash (used in) investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of securities
Payment for costs of issue of securities
Net cash from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Notes
30 June 2021
$
30 June 2020
$
261,991
10,860
45,929
30,324
(2,608,988)
(1,536,498)
15
(2,336,137)
(1,460,245)
30,000
6,000
-
-
(15,425)
(57,438)
2,640
23,215
-
(57,438)
4,473,750
1,423,750
(220,035)
(139,150)
4,253,715
1,284,600
1,940,793
2,435,260
(233,083)
2,668,343
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
3
4,376,053
2,435,260
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes
43
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation of the financial statements are set out below. The
financial statements are for the Group consisting of Golden State Mining Limited and its subsidiaries. The
financial statements are presented in the Australian currency. Golden State Mining Limited is a public company
limited by shares incorporated and domiciled in Australia whose shares are publicly traded on the Australian
Securities Exchange. It is a “for profit” entity. The financial statements were authorised for issue by the directors
on 29 September 2021. The directors have the power to amend and reissue the financial statements.
(a) Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards and Interpretations issued by the Australian Accounting Standards Board and the Corporations Act
2001. Golden State Mining Limited is a for-profit entity for the purpose of preparing the financial statements.
The consolidated financial statements have been prepared on the basis of historical cost, except for certain
financial instruments that are measured at revalued amounts or fair values at the end of each reporting period,
as explained in the accounting policies below. Historical cost is generally based on the fair values of the
consideration given in exchange for goods and services. All amounts are presented in Australian dollars,
unless otherwise noted.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date, regardless of whether that price is directly
observable or estimated using another valuation technique. In estimating the fair value of an asset or liability,
the Group takes into account the characteristics of the asset or liability at the measurement date. Fair value
for measurement and/or disclosure purposes in these consolidated financial statements is determined on such
a basis, except for share-based payment transactions that are within the scope of AASB 2 Share-based
Payment, leasing transactions that are within the scope of AASB 16 Leases, and measurements that have
some similarities to fair value but are not fair value, such as net realisable value in AASB 102 Inventories or
value in use in AASB 136 Impairment of Assets.
In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based
on the degree to which inputs to the fair value measurements are observable and the significance of the inputs
to the fair value measurement in its entirety, which are described as follows:
• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that
the entity can access at the measurement date;
• Level 2 inputs are inputs, other than quoted prices included in Level 1, that are observable for the
asset or liability, either directly or indirectly; and
• Level 3 inputs are unobservable inputs for the asset or liability.
Going concern
The financial statements have been prepared on the going concern basis, which contemplates the continuity
of normal business activities and the realisation of assets and settlement of liabilities in the normal course of
business.
The Group has incurred a net loss after tax for the year ended 30 June 2021 of $3,139,752 (2020: loss of
$1,663,463) and had net cash outflows from operating activities of $2,336,137 (2020: $1,460,245). As at 30
June 2021 the Group had a working capital surplus of $4,112,166 (2020 surplus $2,171,155) and cash and
cash equivalents of $4,376,053 (2020: $2,435,260).
The ability of the entity to continue as a going concern is dependent on securing additional capital raising
activities to continue its operational and exploration activities.
44
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
Should the entity not be able to continue as a going concern, it may be required to realise its assets and
discharge its liabilities other than in the ordinary course of business, and at amounts that differ from those
stated in the financial statements and that the financial report does not include any adjustments relating to the
recoverability and classification of recorded asset amounts or liabilities that might be necessary should the
entity not continue as a going concern.
(i) Compliance with IFRS
The consolidated financial statements of the Golden State Mining Limited Group also comply with International
Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
(ii) New and amended standards adopted by the Group
The Group has considered the implications of new and amended Accounting Standards which have become
applicable for the current financial reporting period.
Initial adoption of AASB 2020-04: COVID-19-Related Rent Concessions
AASB 2020-4: Amendments
– COVID-19-Related Rent
Concessions amends AASB 16 by providing a practical expedient that permits lessees to assess whether rent
concessions that occur as a direct consequence of the COVID-19 pandemic and, if certain conditions are
met, account for those rent concessions as if they were not lease modifications.
to Australian Accounting Standards
Initial adoption of AASB 2018-6: Amendments to Australian Accounting Standards – Definition of a
Business
AASB 2018-6 amends and narrows the definition of a business specified in AASB 3: Business
Combinations, simplifying the determination of whether a transaction should be accounted for as a business
combination or an asset acquisition. Entities may also perform a calculation and elect to treat certain
acquisitions as acquisitions of assets.
Initial adoption of AASB 2018-7: Amendments to Australian Accounting Standards – Definition of
Material
This amendment principally amends AASB 101 and AASB 108 by refining the definition of material by
improving the wording and aligning the definition across the standards issued by the AASB.
Initial adoption of AASB 2019-3: Amendments to Australian Accounting Standards – Interest Rate
Benchmark
This amendment amends specific hedge accounting requirements to provide relief from the potential effects
of the uncertainty caused by interest rate benchmark reform.
Initial adoption of AASB 2019-1: Amendments to Australian Accounting Standards – References to the
Conceptual Framework
This amendment amends Australian Accounting Standards, Interpretations and other pronouncements to
reflect the issuance of Conceptual Framework for Financial Reporting by the AASB.
The standards listed above did not have any impact on the amounts recognised in prior periods and are not
expected to significantly affect the current or future periods.
45
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
(b) Principles of consolidation
(i) Subsidiaries
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls
an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity
and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are
fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from
the date that control ceases.
The acquisition method of accounting is used to account for business combinations by the Group.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are
eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment
of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure
consistency with the policies adopted by the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated
statement of profit or loss and other comprehensive income, statement of changes in equity and statement of
financial position respectively.
(ii) Changes in ownership interests
The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions
with equity owners of the Group. A change in ownership interest results in an adjustment between the carrying
amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any
difference between the amount of the adjustment to non-controlling interests and any consideration paid or
received is recognised in a separate reserve within equity attributable to owners of Golden State Mining
Limited.
When the Group ceases to have control, any retained interest in the entity is remeasured to its fair value with
the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the
purposes of subsequently accounting for the retained interest as an associate, jointly controlled entity or
financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of
that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may
mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.
If the ownership interest in a jointly controlled entity or associate is reduced but joint control or significant
influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive
income are reclassified to profit or loss where appropriate.
(c) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker. The chief operating decision maker, who is responsible for allocating resources and
assessing performance of the operating segments, has been identified as the full board of Directors.
(d) Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of
the primary economic environment in which the entity operates (‘the functional currency’). The consolidated
financial statements are presented in Australian dollars, which is Golden State Mining Limited’s functional and
presentation currency.
46
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing
at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at year end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in profit or loss. They are deferred in equity if they are
attributable to part of the net investment in a foreign operation.
(iii) Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary
economy) that have a functional currency different from the presentation currency are translated into the
presentation currency as follows:
• assets and liabilities for each statement of financial position presented are translated at the closing
rate at the date of that statement of financial position;
•
income and expenses for each statement of profit and loss and other comprehensive income are
translated at average exchange rates (unless that is not a reasonable approximation of the cumulative
effect of the rates prevailing on the transaction dates, in which case income and expenses are
translated at the dates of the transactions); and
• all resulting exchange differences are recognised in other comprehensive income.
On consolidation, exchange differences arising from the translation of any net investment in foreign entities,
and of borrowings and other financial instruments designated as hedges of such investments, are recognised
in other comprehensive income. When a foreign operation is sold or any borrowings forming part of the net
investment are repaid, the associated exchange differences are reclassified to profit or loss, as part of the gain
or loss on sale.
(e) Revenue recognition
The Group applies AASB 15 Revenue from Contracts with Customers. The Group does not have any revenue
from contracts with customers.
(i) Interest income
Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to
the Group and the amount of revenue can be measured reliably. Interest income is accrued on a time basis,
by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that
exactly discounts estimated future cash receipts though the expected life of the financial asset to that asset’s
net carrying amount on initial recognition.
(f) Income tax
The income tax expense or revenue for the year is the tax payable on the current year’s taxable income based
on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at
the end of the reporting period in the countries where the Company’s subsidiaries and associates operate and
generate taxable income. Management periodically evaluates positions taken in tax returns with respect to
situations in which applicable tax regulation is subject to interpretation. It establishes provisions where
appropriate on the basis of amounts expected to be paid to the tax authorities.
47
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
Deferred income tax is provided in full, using the liability method, on temporary differences arising between
the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements.
However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability
in a transaction other than a business combination that at the time of the transaction affects neither accounting
nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted
or substantially enacted by the reporting date and are expected to apply when the related deferred income tax
asset is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount
and tax bases of investments in controlled entities where the parent entity is able to control the timing of the
reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable
future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and
tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on
a net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised
in other comprehensive income or directly in equity. In this case, the tax is also recognised in other
comprehensive income or directly in equity, respectively.
(g) Impairment of assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested
annually for impairment, or more frequently if events or changes in circumstances indicate that they might be
impaired. Other assets are reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which
the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an
asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are
grouped at the lowest levels for which there are separately identifiable cash inflows which are largely
independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial
assets that suffered an impairment are reviewed for possible reversal of the impairment at the end of each
reporting period.
(h) Cash and cash equivalents
For statement of cash flows presentation purposes, cash and cash equivalents includes cash on hand,
deposits held at call with financial institutions, other short term highly liquid investments with original maturities
of three months or less that are readily convertible to known amounts of cash and which are subject to
insignificant risk of changes in value.
(i) Financial instruments (AASB 9)
Recognition, initial measurement and derecognition
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual
provisions of the financial instrument. Financial instruments (except for trade receivables) are measured
initially at fair value adjusted by transaction costs, except for those carried at ‘fair value through profit or loss’,
in which case transaction costs are expensed to profit or loss. Where available, quoted prices in an active
market are used to determine the fair value. In other circumstances, valuation techniques are adopted.
Subsequent measurement of financial assets and financial liabilities are described below.
Trade receivables are initially measured at the transaction price if the receivables do not contain a significant
financing component in accordance with AASB 15.
48
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire,
or when the financial asset and all substantial risks and rewards are transferred. A financial liability is
derecognised when it is extinguished, discharged, cancelled or expired.
Classification and measurement
Financial assets
Except for those trade receivables that do not contain a significant financing component and are measured at
the transaction price in accordance with AASB 15, all financial assets are initially measured at fair value
adjusted for transaction costs (where applicable).
For the purpose of subsequent measurement, financial assets other than those designated and effective as
hedging instruments are classified into the following categories upon initial recognition:
• amortised cost;
•
•
fair value through other comprehensive income (FVOCI); and
fair value through profit or loss (FVPL).
Classifications are determined by both:
•
•
the contractual cash flow characteristics of the financial assets; and
the Group’s business model for managing the financial asset.
Financial assets at amortised cost
Financial assets are measured at amortised cost if the assets meet with the following conditions (and are not
designated as FVPL);
•
•
they are held within a business model whose objective is to hold the financial assets and collect its
contractual cash flows; and
the contractual terms of the financial assets give rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding.
After initial recognition, these are measured at amortised cost using the effective interest method. Discounting
is omitted where the effect of discounting is immaterial. The Group’s cash and cash equivalents, trade and
most other receivables fall into this category of financial instruments.
Financial assets at fair value through other comprehensive income (Equity instruments)
The Group measures debt instruments at fair value through OCI if both of the following conditions are met:
•
•
the contractual terms of the financial asset give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding; and
the financial asset is held within a business model with the objective of both holding to collect
contractual cash flows and selling the financial asset.
For debt instruments at fair value through OCI, interest income, foreign exchange revaluation and impairment
losses or reversals are recognised in the statement of profit or loss and computed in the same manner as for
financial assets measured at amortised cost. The remaining fair value changes are recognised in OCI.
49
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
Upon initial recognition, the Group can elect to classify irrevocably its equity investments as equity instruments
designated at fair value through OCI when they meet the definition of equity under AASB 132 Financial
Instruments: Presentation and are not held for trading.
Financial assets at fair value through profit or loss (FVPL)
Financial assets at fair value through profit or loss include financial assets held for trading, financial assets
designated upon initial recognition at fair value through profit or loss or financial assets mandatorily required
to be measured at fair value. Financial assets are classified as held for trading if they are acquired for the
purpose of selling or repurchasing in the near term.
Financial liabilities
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss,
loans and borrowings, payables or as derivatives designated as hedging instruments in an effective hedge, as
appropriate.
Financial liabilities are initially measured at fair value, and, where applicable, adjusted for transaction costs
unless the Group designated a financial liability at fair value through profit or loss.
Subsequently, financial liabilities are measured at amortised cost using the effective interest method except
for derivatives and financial liabilities designated at FVPL, which are carried subsequently at fair value with
gains or losses recognised in profit or loss.
All interest-related charges and, if applicable, gains and losses arising on changes in fair value are recognised
in profit or loss.
Impairment
The Group assesses on a forward-looking basis the expected credit loss associated with its debt instruments
carried at amortised cost and FVOCI. The impairment methodology applied depends on whether there has
been a significant increase in credit risk. For trade receivables, the Group applies the simplified approach
permitted by AASB, which requires expected lifetime losses to be recognised from initial recognition of the
receivables.
(j) Plant and equipment
All plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that
is directly attributable to the acquisition of the items.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will flow to the
Group and the cost of the item can be measured reliably. The carrying amount of any component accounted
for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the
statement of profit and loss and other comprehensive income during the reporting period in which they are
incurred.
Depreciation of plant and equipment is calculated using the prime cost method to allocate their cost or revalued
amounts, net of their residual values, over their estimated useful lives.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying
amount is greater than its estimated recoverable amount (note 1(g)).
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are
included in the statement of profit and loss and other comprehensive income.
50
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
(k) Exploration and development expenditure
Exploration and evaluation costs are expensed as incurred. Acquisition expenditure incurred is accumulated
in respect of each identifiable area of interest. These costs are only carried forward to the extent that they are
expected to be recouped through the successful development of the area or where activities in the area have
not yet reached a stage that permits reasonable assessment of the existence of economically recoverable
reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the
decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest are amortised over the
life of the area according to the rate of depletion of the economically recoverable reserves.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest.
Costs of site restoration are provided over the life of the facility from when exploration commences and are
included in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant,
equipment and building structures, waste removal, and rehabilitation of the site in accordance with clauses of
the mining permits. Such costs have been determined using estimates of future costs, current legal
requirements and technology on an undiscounted basis.
Any changes in the estimates for the costs are accounted on a prospective basis in determining the costs of
site restoration, there is uncertainty regarding the nature and extent of the restoration due to community
expectations and future legislation. Accordingly, the costs have been determined on the basis that the
restoration will be completed within one year of abandoning the site.
(l) Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the
financial year which are unpaid. The amounts are unsecured, non-interest bearing and are paid on normal
commercial terms.
(m) Employee benefits
Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits, and annual leave expected to be settled
within 12 months of the reporting date are recognised as current liabilities in respect of employees’ services
up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled.
(n) Share-based payments
The Group may provide benefits to employees (including directors) of the Group, and to vendors and suppliers,
in the form of equity-based payment transactions, whereby employees render services, or where vendors sell
assets to the Group, in exchange for shares or rights over shares (‘equity-settled transactions’).
The cost of equity-settled transactions with employees is measured by reference to the “fair value”, not market
value. The “fair value” is determined in accordance with Australian Accounting Standards. In the case of share
options issued, in the absence of a reliable measure, AASB 2 Share Based Payments prescribes the approach
to be taken to determining the fair value. The Black-Scholes European Option Pricing Model is an industry
accepted method of valuing share options. Other models may be used.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over
the period in which the performance conditions are fulfilled (if applicable), ending on the date on which the
relevant employees become fully entitled to the award (‘vesting date’).
51
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date
reflects (i) the extent to which the vesting period has expired and (ii) the number of options that, in the opinion
of the directors of the Group, will ultimately vest. This opinion is formed based on the best available information
at balance date. No adjustment is made for the likelihood of market performance conditions being met as the
effect of these conditions is included in the determination of fair value at grant date.
No expense is recognised for options that do not ultimately vest, except for options where vesting is conditional
upon a market condition.
Where an 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 a modification of the original option.
(o) Issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction,
net of tax, from the proceeds.
(p) Earnings per share
(i) Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the company, excluding
any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take
into account the after income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares and the weighted average number of shares assumed to have been issued for no
consideration in relation to dilutive potential ordinary shares.
(q) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred
is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of
the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount
of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables
in the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or
financing activities which are recoverable from, or payable to the taxation authority, are presented as operating
cash flows.
(r) New accounting standards for application in future periods
There are a number of new accounting standards and interpretations issued by the AASB that are not yet
mandatorily applicable to the Group and have not been applied in preparing these consolidated financial
statements. The Group does not plan to adopt these standards early.
These standards are not expected to have a material impact on the Group in the current or future reporting
periods.
52
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
(s) Critical accounting judgements, estimates and assumptions
The preparation of these financial statements requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of applying the Group’s accounting policies.
The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates
are significant to the financial statements are:
Taxation
Balances disclosed in the financial statements and the notes thereto related to taxation are based on the best
estimates of the directors. These estimates take into account both the financial performance and position of
the Group as they pertain to current income taxation legislation, and the directors understanding thereof. No
adjustment has been made for pending or future taxation legislation. The current income tax position
represents that directors’ best estimate, pending an assessment by the Australian Taxation Office.
Share-based payments
Share-based payment transactions, in the form of options to acquire ordinary shares, are valued using the
Black-Scholes option or other recognised pricing model. Models use assumptions and estimates as inputs.
Whilst the Directors do not necessarily consider the result derived by the application of, say, the Black-Scholes
Option Pricing Model is in anyway representative of the market value of the share options issued, in the
absence of reliable measure for the same, AASB 2 Share Based Payments prescribes the fair value be
determined by applying a generally accepted valuation methodology. The Company has adopted the Black-
Scholes Option Pricing Model for presently relevant purposes. Other recognised models may be used.
Recovery of Deferred Tax assets
Judgment is required in determining whether deferred tax assets are recognised in the balance sheet. Deferred
tax assets, including those arising from un-utilised tax losses require management to assess the likelihood that
the Group will generate taxable earnings in future periods, in order to utilise recognised deferred tax assets.
Deferred tax assets will not be recognised until the Group is able to generate a net taxable income.
Estimates of future taxable income will be based on forecast cash flows from operations and the application of
existing tax laws in each jurisdiction. To the extent that future cash flows and taxable income differ significantly
from estimates, the ability of the Group to realise the net deferred tax assets recorded at the reporting date
could be impacted.
Additionally, future changes in tax laws in the jurisdictions in which the Group operates could limit the ability of
the Group to obtain tax deductions in future periods.
(t) Financial Risk Management
The Group’s activities expose it to a variety of financial risks: market risk (including currency risk, interest rate
risk and price risk), credit risk and liquidity risk. The Group’s overall risk management program includes
consideration of the unpredictability of financial markets and seeks to minimise potential adverse effects on
the financial performance of the Group in the context of the board’s judgement as to an acceptable balance as
between risk/reward in the context of the Company and all the prevailing circumstances.
Risk management is carried out by a risk management committee comprised of the full board of Directors as
the Group believes, given the circumstances of the Company, that it is crucial for all board members to be
involved in this process. Therefore, all Directors have responsibility for identifying, assessing, treating and
monitoring risks and reporting to the board on risk management.
53
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
(A) Market risk
(i) Foreign exchange risk
The Group is currently not exposed to foreign exchange risk.
(ii) Price risk
The Group is currently not exposed to foreign exchange risk.
(iii) Interest rate risk
The Group is exposed to movements in market interest rates on cash and cash equivalents. Exposure to
interest rate risk arises on financial assets and financial liabilities recognised at reporting date whereby a future
change in interest rates will affect future cash flows or the fair value of fixed rate financial instruments.
(B) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial
loss to the Group. The Group has adopted a policy of only dealing with credit worthy counterparties as a means
of mitigating the risk of financial loss from activities.
The Group does not have any significant credit risk exposure to any single counterparty or any Group of
counterparties having similar characteristics. The credit risk on liquid funds is limited because the
counterparties are banks with high credit-ratings assigned by international credit-rating agencies.
The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses,
represents the Group’s maximum exposure to credit risk.
(C) Liquidity risk
The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and ensuring
sufficient cash and marketable securities are available to meet the current and future commitments of the
Group. Debt and equity funding are options open to the Company. The board of Directors constantly monitor
the state of equity markets in conjunction with the Group’s current and future funding requirements, with a view
to ensuring the Group has adequate funds available.
The financial liabilities of the Group are confined to trade and other payables as disclosed in the statement of
financial position. All trade and other payables are non-interest bearing and due within 12 months of the
reporting date.
(D) Fair value measurements
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement
or for disclosure purposes. All financial assets and financial liabilities of the Group at the balance date are
recorded at amounts approximating their fair value.
The fair value of financial instruments traded in active markets is based on quoted market prices at the
reporting date. The quoted market price used for financial assets held by the Group is the current bid price.
The carrying value, less impairment provision, of trade receivables and payables are assumed to approximate
their fair values due to their short-term nature.
54
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 2: SEGMENT INFORMATION
The Group has identified that it operates in only one segment based on the internal reports that are reviewed
and used by the board of directors (chief operating decision makers) in assessing performance and
determining the allocation of resources. The Group's principal activity is mineral exploration, evaluation and
investment.
NOTE 3: CASH AND CASH EQUIVALENTS
Cash at bank
Short-term deposits
Total
NOTE 4: TRADE AND OTHER RECEIVABLES
Kirkalocka Gold SPV Pty Ltd1
Less provision for doubtful debt
GST receivable
Total
June 2021
$
June 2020
$
436,053
3,940,000
4,376,053
715,260
1,720,000
2,435,260
June 2021
$
June 2020
$
782,050
(782,050)
30,906
30,906
-
-
32,808
32,808
1 Kirkalocka Gold SPV Pty Ltd a subsidiary of Adaman Resources Pty Ltd (“Adaman”) was invoiced $782,050
(including GST) for ore sales, royalties, site rehabilitation and interest pursuant to the Ore Sale and Purchase
Agreement that was signed with Adaman to purchase, mine and process remnant mine tailings (battery sands)
from the Company’s historic Cue No. 1 and Salisbury mines. During the year Administrators were appointed
to Adaman and its subsidiaries. The Company has made a provision for doubtful debt for the entire amount.
NOTE 5: ACCRUED INCOME
Term deposits - interest income receivable
NOTE 6: PREPAYMENTS
Prepaid insurance
June 2021
$
June 2020
$
2,329
1,404
June 2021
$
June 2020
$
6,645
-
55
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 7: TRADE AND OTHER PAYABLES
Current
Trade payables
Other payables and accruals1
Total
June 2021
June 2020
$
$
63,203
159,705
222,908
148,408
100,776
249,184
1 Other payables and accruals include $53,749 for royalties owing pursuant to the purchase, mining and
processing remnant mine tailings (battery sands) from the Company’s historic Cue No. 1 and Salisbury mines
by Adaman.
June 2021
0-30 days
31-60 days
61-90 days
90+ days
Total
$
Trade payables
$63,036
$
167
$
-
$
-
$
63,203
NOTE 8: PROVISIONS
Current
Provision for employee entitlements
Total Current
Non-current
Environmental rehabilitation provision
Total Non-current
Environmental rehabilitation
June 2021
June 2020
$
$
80,859
80,859
188,864
188,864
49,133
49,133
188,864
188,864
As at 30 June 2021, there is an estimated cost provision of $188,864 for the environmental rehabilitation of
the Cue Gold project tenements. The environmental rehabilitation cost relates to the pre-acquisition mine
operation and closure plan by Western Mining Pty Ltd. The directors have reviewed the estimates close to
balance date and are of the opinion that no further provision is required as at 30 June 2021.
56
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 9: OTHER INCOME
Co-funded drilling grant
Deposit on sale of 80% Cuddingwarra & Big Bell South
COVID-19 business support grants
Sale of fixed assets
Kirkalocka Gold SPV Pty Ltd – ore sales, royalties, site
rehabilitation and interest pursuant to the Ore Sale and
Purchase Agreement
June 2021
June 2020
$
$
150,000
30,000
111,991
-
712,758
-
-
43,809
2,120
-
Total
1,004,749
45,929
NOTE 10: EQUITY SECURITIES ISSUED
Equity shares
June
2021
Shares
June
2021
$
June
2020
Shares
June
2020
$
Outstanding at the beginning of the year
46,726,200
6,435,632
36,251,200
5,196,031
Issues of ordinary shares
Fully paid shares yet to be issued1
-
-
-
50,000
Fully paid shares issued – Exercise of options
1,460,000
217,500
950,000
230,000
Fully paid shares issued – Placements
34,130,000
4,256,250
9,150,000
1,143,750
Fully paid shares issued – Drilling services
432,158
71,400
375,000
30,000
Transaction costs
Options issued to Lead Managers
-
-
(220,035)
-
-
-
(139,149)
(75,000)
Outstanding at the end of the period
82,748,358
10,760,747
46,726,200
6,435,632
1As at 30 June 2020, there was $10,000 paid for 80,000 shares that were issued at $0.125 per share on 6 July 2020 in the
Tranche 2 placement. In addition, there was $40,000 received for the exercise of 200,000 options at $0.20 per option and
the shares were issued on 6 July 2020.
As at 30 June 2021, the Company had 82,748,358 fully paid ordinary shares.
57
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
Capital risk management
The Group’s objectives when managing capital is to safeguard its ability to continue as a going concern and
to take advantage of organic and acquisitive mineral property opportunities, so that it may strive to provide
returns for shareholders and benefits for other stakeholders.
Debt and equity funding options are open to the Group. The working capital position of the Group at 30 June
2021 and 30 June 2020 are as follows:
June 2021
June 2020
$
$
Cash and cash equivalents
Trade and other receivables
Accrued income
Prepayments
Trade and other payables
Working capital position
Options
4,376,053
30,906
2,329
6,645
(222,908)
4,193,025
2,435,260
32,808
1,404
-
(249,184)
2,220,288
June
2021
Number of
options
June
2021
$
June
2020
Number of
options
June
2020
$
Outstanding at the beginning of the year
12,232,560
716,780
16,015,104
600,943
Movements of options
Issued, exercisable at $0.1625, expiring
26 June 2023 – Lead managers
-
-
4,000,000
150,000
Exercised Options1
(1,460,000)
(60,080)
(950,000)
-
Expired options - (exercise price $0.25,
expiring 8 Nov 2019)
Issued, exercisable at $0.40, expiring
30 September 2024 - Directors & employees
Issued, exercisable at $0.60, expiring
30 September 2024 - Directors & employees
Issued, exercisable at $0.40, expiring
30 September 2024 - Consultant
Issued, exercisable at $0.25, expiring
8 November 2021 - Consultant
Issued, exercisable at $0.25, expiring
26 October 2022 - Consultant
-
-
(6,832,544)
(34,163)
2,950,000
428,276
2,950,000
243,596
250,000
22,075
250,000
4,217
200,000
15,022
-
-
-
-
-
-
-
-
-
-
Outstanding at the end of the period
17,372,560
1,369,886
12,232,560
716,780
1 The $60,080 is the fair value that was attributed to the options when granted.
As at 30 June 2021, the Company had 17,372,560 unlisted options.
58
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 11: SHARE-BASED PAYMENTS
The following table illustrates the number (No.) and weighted average exercise prices (WAEP) and movements
in share options issued as share based payments as at 30 June 2021.
Options
June
2021
June
2021
June 2020
June
2020
No.
WAEP
WAEP
No.
Outstanding
beginning of the year
at
the
11,832,560
$0.23
8,632,560
Granted during the period
6,600,000
Exercised during the period
(1,060,000)
Outstanding at the end of the
period 1
Exercisable at the end of the
period
17,372,560
14,422,560
$0.48
$0.17
$0.33
$0.27
4,000,000
(800,000)
11,832,560
11,832,560
$0.26
$0.16
$0.25
$0.23
$0.23
1 Balance included 200,000 options granted in the period but issued on 20 July 2021.
The weighted average remaining contractual life for the share-based payment options as at 30 June 2021 is
1.73 years (2020: 2.10).
The weighted average exercise price for the share-based payment options as at 30 June 2021 is $0.33 (June
2020: $0.23).
Options issued during the current year:
On 27 November 2020, there were 2,950,000 unlisted options granted which had a fair value of $ 0.1452 per
option based on a Black Scholes model with the following key inputs: interest free rate – 0.1%, volatility factor
–109% measured since the date of ASX listing on 8 November 2018, grant date – 27 November 2020, days
to expiry –1,369 and exercise price - $0.40. The value recognised to the options was $428,276.
On 27 November 2020, there were 2,950,000 unlisted options granted subject to a vesting condition that the
relevant director/employee remains an employee or officer of the Company until 31 October 2021, failing which
the options granted lapse, unless and to the extent the Board waives the vesting condition; which had a fair
value of $ 0.1298 per option based on a Black Scholes model with the following key inputs: interest free rate
– 0.1%, volatility factor –109% measured since the date of ASX listing on 8 November 2018, grant date – 27
November 2020, days to expiry –1,369 and exercise price - $0.60. The vesting amount as at 30 June 2021
was $243,596 in accordance with the vesting period of the options.
On 15 June 2021, there were 250,000 unlisted options granted to advisors as an incentive for services which
had a fair value of $0.01687 per option based on a Black Scholes model with the following key inputs: interest
free rate – 0.1%, volatility factor – 85% measured approximately 5 months prior to grant date – 15 June 2021,
days to expiry –146 and exercise price - $0.25. The value recognised to the options was $4,217.
On 15 June 2021, there were 250,000 unlisted options granted to advisors as an incentive for services which
had a fair value of $0.0883 per option based on a Black Scholes model with the following key inputs: interest
free rate – 0.1%, volatility factor – 104% measured since the date of ASX listing on 8 November 2018, grant
date – 15 June 2021, days to expiry – 1,203 and exercise price - $0.40. The value recognised to the options
was $22,075.
59
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
On 15 June 2021, there were 200,000 unlisted options granted to advisors as an incentive for services which
had a fair value of $0.07511 per option based on a Black Scholes model with the following key inputs: interest
free rate – 0.1%, volatility factor – 120% measured approximately 16.5 months prior to grant date – 15 June
2021, days to expiry – 498 and exercise price - $0.25. The value recognised to the options was $15,022. These
options, although granted in the period, have been issued on 20 July 2021.
During the period, a total of 1,060,000 unlisted options granted as share based payments were exercised as
follows:
60,000 unlisted options exercised at $0.25, expiry 8 November 2021; and
1,000,000 unlisted options exercised at $0.1625, expiry 26 June 2023.
In previous year options valuations Black-Scholes model was used for the valuation of share-based payments,
taking into account the terms and conditions upon which the options were granted. The expected life of the
options is based on historical data and is not necessarily indicative of exercise patterns that may occur. The
expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may
also not necessarily be the actual outcome.
No option holder has any right under the options to participate in any other share issue of the Company or any
other entity.
Recognised share-based payments expenses
Total expenses arising from share-based payment transactions recognised during the period as part of share-
based payment expense were as follows:
Operating expenditure
Options issued to directors, employees and
consultants
Lead manager options (corporate advisory)
Shares issued for drilling services
2021
2020
$
713,186
-
-
$
-
75,000
30,000
Total
713,186
105,000
NOTE 12: DIVIDENDS
No dividends were paid during the year and no recommendation is made as to the dividends.
NOTE 13: ACCUMULATED LOSSES
Accumulated losses at the beginning of the financial year
Exercised/expired options (reserve transferred)
Net (loss) attributable to members of the company
Accumulated losses at the end of the financial year
June 2021
(5,038,622)
60,080
June 2020
(3,409,322)
34,163
(3,139,752)
(1,663,463)
(8,118,294)
(5,038,622)
60
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 14: FINANCIAL RISK MANAGEMENT
The company's financial instruments consist mainly of deposits with banks, accounts receivable and payable.
The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in
the accounting policies to these financial statements are as follows:
2021
2020
Financial
Instruments
Floating
Interest
Rate
$
Fixed
Interest
Rate
$
Non-
interest
bearing
$
Total
$
Floating
Interest
Rate
$
Fixed
Interest
Rate
$
Non-
interest
bearing
$
Total
$
and
and
rate
and
Financial
Assets
Cash
cash
equivalents
Trade
other
receivables
Total
financial
assets
Weighted
average
interest
for the year
Financial
liabilities
Trade
other
payables
Total
financial
liabilities
321,929
3,940,000
114,124
4,376,053
653,820
1,720,000
61,440
2,435,260
-
-
30,906
30,906
-
-
32,808
32,808
321,929
3,940,000
145,030
4,406,959
653,820
1,720,000
94,248
2,468,068
0.0%
0.32%
0.0%
0.8%
-
-
-
222,908
222,908
-
222,908
222,908
-
-
-
249,184
249,184
-
249,184
249,184
Financial Risk Management Policies
The director's overall risk management strategy seeks to assist the company in meeting its financial targets,
whilst minimising potential adverse effects on financial performance.
Risk management policies are approved and reviewed by the Board of Directors on a regular basis. This
includes credit risk policies and future cash flow requirements.
The main purpose of non-derivative financial instruments is to raise finance for company operations.
The company does not have any derivative instruments as at 30 June 2021.
Sensitivity analysis
At reporting date, if interest rates had been 100 basis points higher or lower and all other variables were held
constant, the Company’s net loss would increase or decrease by approximately $4,376 (2020: $2,435) which
is attributable to the Group’s exposure to interest rates on its variable bank deposits.
61
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 15: RECONCILIATION OF LOSS AFTER TAX TO NET CASH OUTFLOW FROM
OPERATING ACTIVITIES
Profit/(Loss) after income tax
(3,139,752)
(1,663,463)
Consolidated
June 2021
June 2020
$
$
Non-cash flows in loss for the period
Depreciation
Share based payments
Gain on sale of assets
Liabilities settled in shares
Changes in assets and liabilities
(Increase) / Decrease in trade and other receivables
(Increase) / Decrease in Accrued income
(Increase) / Decrease in Prepayments
Increase / (Decrease) in trade and other payables
Increase / (Decrease) in Provisions
50,778
713,186
(1,531)
71,400
(28,098)
(925)
(6,645)
(26,276)
31,726
108,165
105,000
-
-
(12,677)
5,242
-
(31,992)
29,480
Net cash inflows (outflows) from operating activities
(2,336,137)
(1,460,245)
NOTE 16: REMUNERATION OF AUDITORS/ NON-AUDIT SERVICES
REMUNERATION OF AUDITORS
Audit of financial reports
NON-AUDIT SERVICES
Taxation (to associated entity)
$
30,679
2,050
$
30,921
2,500
2021
2020
62
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 17: INCOME TAX EXPENSE
Consolidated
June 2021
$
June 2020
The components of income tax benefit comprise:
Current income tax benefit
Deferred income tax expense
Income tax expense reported in the consolidated statement of
comprehensive income
Income tax expense recognised in equity
Accounting Profit/(Loss) before income tax
At the statutory income tax rate of 26% (2020: 27.50%)
Other non-deductible expenditure for income tax purposes
Other adjustments
Unrecognised tax losses
Deferred tax assets
Carried forward revenue losses
Other
Gross deferred tax asset
Offset against deferred tax liability
Unrecognised Tax Asset
(714,522)
-
-
-
(3,139,752)
(816,335)
148,687
(46,874)
714,522
1,795,265
-
1,795,265
-
1,795,265
$
(505,021)
-
-
-
(1,663,463)
(457,452)
2,423
(49,992)
(505,021)
1,219,046
-
1,219,046
-
1,219,046
There were no ‘Deferred tax liabilities’ as at 30 June 2021.
Tax loss not recognised
All unused tax losses were incurred in Australia. Potential deferred tax assets net of deferred tax liabilities
attributable to tax losses have not been brought to account because the Directors do not believe it is
appropriate to regard realisation of the future income tax benefits as probable as at the date of this report.
NOTE 18: CONTINGENCIES
In addition to statutory royalties generally applicable mineral production in Western Australia, certain
tenements which make up part of the Group’s Cue and Yule projects are subject to private royalties in respect
of minerals produced from those tenements. These private royalties are described in sections 11.1 and 11.2
(respectively) of the Company’s IPO prospectus dated 22 August 2018.
There are no material contingent liabilities or contingent assets of the Group at the reporting date.
NOTE 19: COMMITMENTS FOR EXPENDITURE
Exploration Commitment
In order to maintain current rights of tenure to various tenements, the company is required to perform minimum
exploration work to meet the minimum expenditure requirements specified by Western Australia. These
obligations are expected to be fulfilled in the normal course of operations and are not provided for in the
financial report.
If the company decides to relinquish certain leases and/or does not meet these obligations, assets recognised
in the balance sheet may require review to determine the appropriateness of carrying values. The sale, transfer
or farm-out of exploration rights to third parties will reduce or extinguish these obligations.
63
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
The Group will be required to outlay approximately $760,300 (2020: $548,800) in the following financial year
to meet minimum expenditure requirements.
Operating Lease Commitment
The Company has not entered into a commercial property lease on its corporate office premises or any other
operating leases. Office rent is currently paid on a month by month basis.
NOTE 20: PROPERTY, PLANT AND EQUIPMENT
Property, Plant and Equipment at cost
Opening balance
Additions
Disposals
Closing balance
Accumulated depreciation
Opening balance
Depreciation for the year
Disposals
Closing balance
Summary
At cost
Accumulated depreciation
Net carrying amount
NOTE 21: BASIC AND DILUTED EARNINGS/(LOSS) PER SHARE
Basic and diluted (loss) per share (cents)
Profit/(Loss) attributable to members of Golden State Mining
Weighted average number of shares outstanding
June 2021
$
June 2020
$
341,099
15,426
(13,000)
343,525
212,240
50,778
(8,530)
254,488
283,661
57,438
-
341,099
104,075
108,165
212,240
343,525
(254,488)
89,037
341,099
(212,240)
128,859
June 2020
June 2021
(4.96)
(3,139,752)
63,331,199
(4.46)
(1,663,463)
37,321,623
NOTE 22: RELATED PARTY TRANSACTIONS AND KMP REMUNERATION
Transactions between related parties are on normal commercial terms and conditions no more favourable than
those available to other parties unless otherwise stated.
Brenton Siggs is a partner of Reefus Geology Services which was paid $55,020 (excl. GST) (2020: $19,380)
for geological services undertaken with respect to the Group’s projects. As at 30 June 2021 the amount owing
to Reefus Geology Services was nil.
Damien Kelly is a director of Western Tiger Corporate Advisors which provided $16,000 (excl. GST) (2020:
Nil) for corporate consulting services. As at 30 June 2021 the amount owed to Western Tiger Corporate
Advisors was $17,600 (incl. GST).
64
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
The Key Management Personnel (KMP) of the Group was comprised of all the board of directors mentioned
above and Mr Moore is the sole Executive Director.
Details of the remuneration of the directors and the key management personnel of the Group are set out in the
following tables:
2021
Short term
Post
Director
Base
Salary & Other Fees
$
Employment
Superannuation
$
Share-Based Payments
$
Total
$
Michael Moore
Damien Kelly
Greg Hancock
Brenton Siggs
Total
180,000
50,000
30,000
30,000
290,000
17,100
4,750
-
2,850
24,700
170,815
367,915
136,652
191,402
91,101
121,101
91,101
123,951
489,669
804,369
2020
Short term
Post
Director
Base
Salary & Other Fees
$
Employment
Superannuation
$
Share-Based Payments
$
Total
$
Michael Moore
Damien Kelly
Greg Hancock
Brenton Siggs
Janet Wicks1
Total
180,000
50,000
30,000
30,000
17,500
307,500
17,100
4,750
-
2,850
-
24,700
-
-
-
-
-
-
197,100
54,750
30,000
32,850
17,500
332,200
1Balance as at Janet Wicks resignation as a director on 10 December 2019. The board agreed to pay Janet Wick’s director
fees up to 31 January 2020.
65
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 23: EQUITY INSTRUMENTS DISCLOSURE - KEY MANAGEMENT PERSONNEL
The Number of shares in which the Directors and Key Management Personnel of the Company held a relevant
interest during the year ended 30 June 2021, including their personally related parties, is set out below:
Working Fully paid ordinary shares
June 2021
Michael Moore
Damien Kelly
Greg Hancock
Brenton Siggs
Total
Balance at
start of the
period
1,625,100
1,510,100
-
660,000
3,795,200
Granted during the year as
compensation
Other
during the year
changes
Balance at end of
the period
-
-
-
-
-
-
-
-
-
-
1,625,100
1,510,100
-
660,000
3,795,200
The Number of options which the Directors and Key Management Personnel of the Company held a relevant
interest during the year ended 30 June 2021, including their personally related parties, is set out below:
Unlisted options
30 June
2021
Michael
Moore
Damien
Kelly
Greg
Hancock
Brenton
Siggs
Balance
start of
year
at
the
Granted
compensation
as
1,500,000
1,500,000
1,500,000
1,200,000
500,000
800,000
750,000
800,000
Total
4,250,000
4,300,000
Exercised Lapsed Other
changes
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Balance
end of
year
at
the
Vested and
exercisable
Unvested
3,000,000
2,250,000
750,000
2,700,000
2,100,000
600,000
1,300,000
900,000
400,000
1,550,000
1,150,000
400,000
8,550,000
6,400,000 2,150,000
66
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 24: GOLDEN STATE MINING LIMITED (THE PARENT ENTITY) INFORMATION
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
NET ASSETS
Contributed equity
Reserves
Accumulated losses
Total equity
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
JUNE 2021
$
4,415,933
58,072
4,474,005
JUNE 2020
$
2,469,472
60,452
2,529,924
240,018
-
240,018
286,830
188,864
475,694
4,233,987
2,054,230
10,760,747
1,369,886
(7,896,646)
4,233,987
6,435,632
716,780
(5,098,182)
2,054,230
(2,858,544)
(1,555,020)
-
-
(2,858,544)
(1,555,020)
There were no guarantees, contingencies and subsequent events other than those disclosed elsewhere in the
report.
NOTE 25: CONTROLLED ENTITIES
Parent entity
Golden State Mining Limited
Subsidiaries
Cue Consolidated Mining Pty Ltd
Crown Mining Pty Ltd
All members of the consolidated entity are incorporated in Australia.
Ownership interest
2021
2020
100%
100%
100%
100%
67
Golden State Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 26: SUBSEQUENT EVENTS
Since the reporting date, on 20 July 2021, 200,000 unlisted $0.25 options (expiry 26 Oct 2022) were issued to
a consultant as part consideration for services. In addition on 30 August 2021, the Company proposed to issue
81,554 fully paid ordinary shares on 29 October 2021 to satisfy an invoice for the cost of earth works for drilling
provided to the Company; and on 22 September the Company proposed to issue 258,073 fully paid ordinary
shares on 29 October 2021 to satisfy certain royalty obligations in respect of the Cue Project.
On 27 July 2021, the Company announced (and has since completed) the sale of an 80% interest in its
Cuddingwarra and Big Bell South Gold projects to Caprice Resources Limited (ASX: CRS). The Company
retains 20% ownership in the projects, forming a Joint Venture (‘JV’) with Caprice Resources Limited.
Key terms of the acquisition and JV are summarised as follows:
•
In consideration for the acquisition the Company received from Caprice on 2 August 2021:
➢ 2,500,000 fully paid ordinary shares in the capital of Caprice,
➢ a $200,000 cash payment ($30,000 of which was received as a deposit prior to balance date), and
➢ 250,000 options in Caprice with an exercise price of $0.25 per option and expiring 3 years from
the date of issue.
• The Company’s 20% ownership over the projects and will be free-carried through to completion of a
pre-feasibility study after which point GSM can elect to contribute or dilute.
• Should Company elect to dilute below 10% project ownership its interest will convert into a 2% Net
Smelter Royalty (NSR) royalty, with Caprice able to buy-back the royalty for a cash payment of
$5,000,000.
• Caprice has first right of refusal should the Company elect to dispose of its project ownership.
• Caprice to operate and manage the JV.
No other matter or circumstance has arisen since 30 June 2021, which has significantly affected, or may
significantly affect the operations of the Group, the result of those operations, or the state of affairs of the
Group in subsequent financial years.
68
Golden State Mining Limited
DIRECTORS’ DECLARATION
1.
2.
3.
In the opinion of the Directors of Golden State Mining Limited:
(a)
The consolidated financial statements and notes, and the Remuneration Report in the
Directors’ Report are in accordance with the Corporations Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2021 and its
performance, for the financial year ended on that date, and
Complying with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Regulations 2001;
(ii)
(b)
There are reasonable grounds to believe that the Company will be able to pay its debts as
and when they become due and payable, and
The directors have been given the declarations required by section 295A of the Corporations Act 2001
from the Managing Director for the financial year ended 30 June 2021.
The financial report also complies with International Financial Reporting Standards as disclosed in
note 1(a) to the consolidated financial statements.
Signed in accordance with a resolution of the Directors.
Michael Moore
Managing Director
29 September 2021
69
PO Box 1908
West Perth WA 6872
Australia
Level 2, 1 Walker Avenue
West Perth WA 6005
Australia
Tel: +61 8 9481 3188
Fax: +61 8 9321 1204
ABN: 84 144 581 519
www.stantons.com.au
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
GOLDEN STATE MINING LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the consolidated financial report of Golden State Mining Limited, the Company and its
subsidiaries, (“the Group”), which comprises the consolidated statement of financial position as at 30 June
2021, the consolidated statement of profit or loss and other comprehensive income, the consolidated
statement of changes in equity and the consolidated statement of cash flows for the year then ended, and
notes to the financial statements, including a summary of significant accounting policies, and the directors'
declaration..
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including
(i)
giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its financial
performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section
of our report. We are independent of the Group in accordance with the auditor independence requirements of
the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards
Board's APES 110: Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of
the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the
Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Liability limited by a scheme approved under Professional Standards Legislation
Stantons Is a member of the Russell
Bedford International network of firms
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial report of the current period. These matters were addressed in the context of our audit of the
financial report, and in forming our opinion thereon, and we do not provide a separate opinion on these
matters.
Key Audit Matters
How the matter was addressed in the audit
Valuation of Share based payments
As disclosed in note 11 of the financial report,
during the period the Company granted a number
of share options to Directors, employees and
consultants of the Company.
The Company prepared a valuation of share
options in accordance with its accounting policy
and the accounting standard AASB 2 - Share-
based Payment.
The valuation of options is considered to be a key
audit matter as it involved judgment in assessing
the fair value of the equity instruments granted, the
grant date, vesting conditions and vesting periods.
In assessing the valuation of share options our audit
procedures included, among others:
i. Obtaining an understanding of the underlying
transactions, reviewing agreements, minutes of
the Board meetings and ASX announcements;
ii. Reviewing the inputs used in the valuation
models, the underlying assumptions used and
discussing with management the justification for
these inputs;
iii. Ensuring the mathematical accuracy of the
valuation model utilised; and
iv. Assessing whether the Company’s disclosures
the accounting
requirements of
the
met
standards.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2021 but does not include the financial report
and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express
any form of assurance opinion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we
have performed, we conclude that there is a material misstatement of this other information, we are required
to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no
realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in
accordance with the Australian Auditing Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of this
financial report.
As part of an audit in accordance with Australian Auditing Standards, we exercise professional judgement and
maintain professional scepticism throughout the audit. An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the financial report.
The procedures selected depend on the auditor's judgement, including the assessment of the risks of material
misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity's preparation of the financial report that gives a true
and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the entity's internal control.
The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial
report.
We conclude on the appropriateness of the Directors' use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the
financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on
the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may
cause the Group to cease to continue as a going concern.
We evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that achieves
fair presentation.
We obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the financial report. We are responsible for the direction,
supervision and performance of the Group’s audit. We remain solely responsible for our audit opinion.
We communicate with the Directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in Internal control that we identify
during our audit.
The Auditing Standards require that we comply with relevant ethical requirements relating to audit
engagements. We also provide the Directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the Directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore key audit matters. We describe these
matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when,
in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 33 to 37 of the directors’ report for the year
ended 30 June 2021.
In our opinion, the Remuneration Report of Golden State Mining Limited for the year ended 30 June 2021
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an
opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing
Standards.
STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD
(An Authorised Audit Company)
Samir Tirodkar
Director
West Perth, Western Australia
29 September 2021
Golden State Mining Limited
ASX Additional Information
Additional information required by Australian Stock Exchange Ltd and not shown elsewhere in this report is as follows.
The information is current as at 7 September 2021.
(a) Distribution of equity securities Analysis of numbers of equity security holders by size of holding:
Number of holders
Number of shares
Ordinary shares
0
1,001
5,001
10,001
100,001
- 1,000
- 5,000
- 10,000
- 100,000
and over
•
•
•
•
•
•
The number of shareholders holding
less than a marketable parcel of
shares are:
(b) Twenty largest shareholders of quoted ordinary shares
The names of the twenty largest holders of quoted ordinary shares are:
54
343
273
604
142
1,416
21,484
1,044,851
2,250,557
21,452,646
57,978,820
82,748,358
329 740,310
Listed ordinary shares
Number of shares
Percentage of
ordinary shares
1 PERTH SELECT SEAFOODS PTY LTD
2 WESTERN MINING PL
3 MULLOWAY PTY LTD
4 STOCKHILL NOMINEES PTY LTD
5 MR MICHAEL JAMES MOORE & MRS RUTH HEATHER MOORE
6 DR MARTIN DRU DANIELS
7 ADVANCED CAPITAL MANAGEMENT PTY LTD
8 CITICORP NOMINEES PTY LIMITED
9 MR DAVID GREGORY MORTON
10 PURPLE STAR HOLDINGS PTY LTD
11 REDROVE EQUIPMENT PTY LTD
12 DR LEON EUGENE PRETORIUS
13 BNP PARIBAS NOMINEES PTY LTD
14 MR TIMOTHY STEWART CAMPBELL
15 GPI MANAGEMENT SERVICES PTY LTD
16 MR SCOTT ROBERT WEIR
17 OCEAN REEF HOLDINGS PTY LTD
18 MUPPET HOLDINGS PTY LTD
19 ST BARNABAS INVESTMENTS PTY LTD
20 TRE PTY LTD