Great Northern Minerals Limited
Annual Report 2020

Plain-text annual report

Great Northern Minerals A N N U A L R E P O R T i Annual Report 2020 | Directors’ ReportGreat Northern Minerals2020Great Northern Minerals Great Northern Minerals Limited (previously Greenpower Energy Limited) ABN 22 000 002 111 Consolidated Annual Report For the Year Ended 30 June 2020 Contents Chairman’s Letter Directors’ Report Consolidated Financial Statements 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 Audit Report Additional Information for Public Listed Companies Interest in Mining Tenements Page 1 2 27 29 30 31 33 34 62 63 68 74 DIRECTORS SHARE REGISTRY Mr Cameron McLean (CEO & Managing Director) Computershare Investor Services Pty Ltd Mr Simon Coxhell (Technical Director) Level 11, 172 St Georges Terrace Mr Kim Robinson (Non-Executive Chairman) Perth WA 6000 Mr Simon Peters (Non-Executive Director) Telephone: 1300 787 272 COMPANY SECRETARY Miss Aida Tabakovic REGISTERED OFFICE & PRINCIPAL PLACE OF BUSINESS Level 1, 33 Colin Street WEST PERTH WA 6005 AUSTRALIA Website: www.greatnorthernminerals.com.au AUDITORS William Buck Audit (WA) Pty Ltd Level 3, 15 Labouchere Road South Perth WA 6151 LEGAL ADVISORS Nova Legal Level 2, 50 Kings Park Road West Perth WA 6005 STOCK EXCHANGE Australian Securities Exchange Limited ASX Code: GNM, GNMOA, GNMOB, GNMOF Annual Report 2020 | Chairman’s Letter Chairman’s Letter On behalf of the Directors I am pleased to present Great Northern Minerals 2020 Annual Report to shareholders and would like to take this opportunity to welcome all new shareholders and to thank our longer standing shareholders for their support as the Company transitions to a successful gold explorer. The last 12 months has seen the Company strengthened at both a corporate and technical level and this will continue to be an key focus of the company as these underexplored and exciting projects develop. In addition, after raising capital throughout the year, your company now has the balance sheet to fund its exploration programs at Camel Creek, Golden Cup and Big Rush with the objective of expanding resources at all projects. The addition of Simon Coxhell earlier in the year to the position of Technical Director adds significant experience to the team. Simon has already built an extremely capable team on site and introduced a great deal of operational rigour. Post financial year end your company completed a significant reverse circulation drilling campaigns at Camel Creek and Big Rush in what was the biggest program yet undertaken by your company. The impressive results highlighted the significant potential of these two projects with no shortage of follow up targets both along strike and at depth. Also of significant importance has been the early payout of the remaining consideration to the vendor for 100% ownership of the three assets, a transaction that was achieved at a 50% discount for the Company. Finally I would like to thank you all for your ongoing support and again welcome aboard our new shareholders at an exciting time for Great Northern Minerals. I wish to thank the staff, management, contractors and my fellow directors for their ongoing efforts. We are all committed to progressing the company through prudent commercial activities and high quality exploration for the benefit of all shareholders. Kim Robinson Chairman 1 Great Northern Minerals Directors’ Report Your directors present their Report on Great Northern Minerals Limited (previously Greenpower Energy Limited) (the “Company” or “GNM”) and its controlled entities (the “Group”) for the financial year ended 30 June 2020. Directors The names of Directors who held office during or since the end of the year: Mr Kim Robinson Non-Executive Chairman (Appointed 1 April 2020) Mr Cameron McLean CEO & Managing Director Mr Simon Coxhell Mr Simon Peters Mr Gerard King Mr Alistair Williams Technical Director (Appointed 1 April 2020) Non-Executive Director Non-Executive Chairman (Resigned 1 April 2020) Non-Executive Director (Resigned 5 August 2019) 2 Annual Report 2020 | Directors’ ReportDirectors’ Qualifications and Experience Kim Robinson (Non-Executive Chairman) Qualifications - Cameron McLean (CEO & Managing Director) Qualifications - Appointment Date 1 April 2020 Appointment Date 12 October 2018 Mr Robinson has over 35 years’ experience in mineral exploration and mining having graduated from the University of Western Australia in 1973 with a degree in Geology. His experience is extensive including 10 years as Executive Chairman of Forrestania Gold NL. During Cameron McLean has more than 20 years’ experience leading and managing a range of commercial activities, including co-directing London business, iBase Limited in the geo-technology sector and as CFO at Snowden Mining Industry Consultants, Kagara Limited and Atrum Coal. his time at Forrestania, Mr Robinson played a key role Mr McLean has a background in accounting and finance in the discovery and development of the Bounty Gold with experience originating at Western Mining in Melbourne. Mine, the development of the Mt McClure Gold Mine and Mr McLean is the founder and major shareholder of the the discovery of the Maggie Hays and Emily Ann nickel mining investment platform, Mineral Intelligence. Through sulphide deposits. Mr Robinson was also a Non-Executive Mineral Intelligence, Mr McLean has facilitated over Director of Jubilee Mines NL in the period leading up to the $100M in mining transactions over the past 5 years. Mr discovery and development of the Cosmos Nickel Mine. McLean identified, secured and introduced the cobalt and Mr Robinson was a founding Director of Kagara Ltd where vanadium projects to the company through Ion Minerals Pty he held the position of Executive Chairman for a period of Ltd of which he is Managing Director. 12 years until February 2011. During this time, he oversaw the development of Kagara’s North Queensland base metal operations, the listing of Mungana Goldmines Ltd on the ASX and the acquisition and development of the high grade Lounge Lizard nickel deposit in Western Australia. Mr Robinson also served as Managing Director at Energia Minerals Ltd. Interests in shares and options Interest in shares and options • • 12,030,250 Ordinary Shares; 625,350 Listed Options exercisable at $0.022 on or before 1 July 2023; • 6,938,025 Listed Options exercisable at $0.01 on or before 1 November 2022; Other directorships in listed entities held in the previous • 6,000,000 Listed Options exercisable at $0.01 on or three years before 1 November 2022. Other directorships in listed entities held in the previous three years None • Director of Pure Minerals Limited (30 November 2018 -) 3 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Simon Peters (Non-Executive Director) Simon Coxhell (Technical Director) Qualifications – BEng (Mining) Qualifications – BSc, Masters MAusIMM (Hons) Appointment Date 6 December 2016 Qualifying Appointment Date 1 April 2020 Mr Peters is a highly experienced mining executive Simon Coxhell is a geologist with 34 years of diverse and qualified mining engineer with more than 20 years experience encompassing all aspects of the resource experience in both hard and soft rock exploration, mine sector including exploration, resource development, development and operations. Over the past 10 years metallurgical considerations and mining. he has had corporate experience on ASX listed boards in senior executive roles. He has held operational and management positions across 3 continents (Africa, Australia & Asia) covering all sections of the exploration & mining development process, including large scale and complex feasibility studies, stakeholder engagement, permits and approvals. Over the last 20 years he has had significant corporate experience on ASX listed boards in senior executive appointments and between 2016-2018 led Echo Resources Limited (ASX: EAR) as Managing Director/CEO, elevating and growing the company from an 8 million dollar market capitalisation exploration focused company to an emerging gold producer with a maximum market capitalisation of Simon is currently a Partner of Sustainable Project Services 182 million dollars, centred on the re-establishment of the which provides strategic & technical management Bronzewing Gold Mine. Over a 3 year period he developed consultancy advice to government, mining and agricultural the gold resource base of Echo from 100,000 resource sectors. Simon is also founding director of Murray Basin ounces to a total resource base of 1.7 million ounces of Resources a company focused on gold exploration in north gold, and a maiden reserve of 800,000 ounces, for the west Victoria. He holds a bachelor of engineering (mining) with Honors from Federation University Australia and an unrestricted WA quarry managers certificate. Interest in shares and options 2,397,461 Ordinary Shares; • • Stage 1 and Stage 2 development option, in August 2018. Northern Star purchased a 19% holding on market in late 2018 to become the largest shareholder and in August 2019 launched a successful takeover of Echo with an implied value of $244 million. Interests in shares and options • 6,000,000 Listed Options exercisable at $0.01 on or 76,923 Listed Options exercisable at $0.18 on or before 1 November 2022. before 15 December 2021; Other directorships in listed entities held in the previous • 199,789 Listed Options exercisable at $0.022 on or three years before 1 July 2023; • Non-Executive Director of Blaze International Limited • 3,000,000 Listed Options exercisable at $0.01 on or (5 April 2019 - ) before 1 November 2022; • Managing Director of Echo Resources Limited (8 • 200,000 Unlisted Options exercisable at $0.30 on or February 2016 - 2 October 2018) before 27 October 2020. Other directorships in listed entities held in the previous three years Managing Director of E2 Metals Limited (27 June 2017 - ) 4 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Previous Company Directors (resigned during the financial year) Gerard King (Non-Executive Chairman) Qualifications – LLB Appointment Date 14 November 1985 Resignation Date1 April 2020 After graduating in law (LLB) from the University of Western Alistair Williams (Non-Executive Director) Qualifications – BSc Economics, Diploma in Corporate Treasury, FCA Chartered Accountant Appointment Date 12 October 2018 Resignation Date 5 August 2019 Australia in 1963, Gerard commenced articles with (Sir) Alistair Williams is an experienced London based finance John Lavan (Lavan & Walsh) in Perth, being admitted as a executive with a background in natural resources as a solicitor in 1965, into the law firm partnership in 1966, and result of management roles undertaken at BG Group and became its senior partner in 1978. Under Gerard, Lavan & Rio Tinto. His last major corporate role was Deputy CFO Walsh eventually became Phillips Fox, Perth in 1985. at BG Group where, in addition to running the Finance Throughout his career, Gerard has practised in the legal areas of commercial property, banking/finance, revenue/tax, corporate compliance, and mining law. He taught mortgage and other debt security drafting at UWA law school for 5 years, joined the Taxation Institute of Australia, and the Australian Mining and Petroleum Lawyers Association and gave papers on revenue, strata title, prospectuses, document drafting and other topics. Gerard served on the Law Society of WA Council, and its committees. He was involved in the management of his law firm from 1968 to 1991 and attended two law firm management courses at the University of New England. Gerard has been a company director of Australasian function for the Group, he was also Chair of the Investment and Energy Trading and Risk Committees. Since leaving the large corporate world in 2011, Mr Williams has pursued a successful career as an entrepreneur and private investor in early stage companies and has developed a diversified portfolio of investments in natural resources, life sciences and IM technology. In Australia, he has served as a Director of Ion Minerals Pty Ltd since inception and has also been a Director of Goldfield Argonaut Pty Ltd since 2015. Goldfield Argonaut Pty Ltd recently concluded the sale of its interest in the Mulwarrie gold exploration licence to Spitfire Materials Limited. Interest in shares and option Shopping Centres Property Trust, 1977 to 1980, Australian • 6,087,500 Ordinary Shares (held as at 5 August 2019) Other directorships in listed entities held in the previous three years None Mining Investments Ltd., 1983 to 2002, as well as other public companies, and is currently Chairman of Astron Limited, since 1985. He was Chairman of WA St. John Ambulance Service Board 1987 to 1996, and WA State St. John Council Chairman until 2017. Interest in shares and options • • 16,578,520 Ordinary Shares (held as at 1 April 2020); 153,846 Listed Options exercisable at $0.18 on or before 15 December 2021 (held as at 1 April 2020); • 200,000 Unlisted Options exercisable at $0.30 on or before 27 October 2020 (held as at 1 April 2020). Other directorships in listed entities held in the previous three years Director of Astron Limited (5 November 1985 - ). 5 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Principal Activities The principal activities of the Group during the financial year were: • The finalisation of an option agreement on the Golden Ant (Camel Creek and Golden Cup) and the Alphadale (Big Rush) gold mines, which resulted in the purchase of a 100% interest (no royalty interests) in 11 mining leases comprising a total of 3 gold projects located approximately 220 kilometres north west of Townsville in the Greenvale region of North Queensland; • The acquisition of the surrounding exploration permits of the mining leases providing additional extensive exploration ground, located along strike from the known gold deposits; • The completion of a maiden drilling program at Golden Cup and Big Rush leading to a number of very encouraging gold intersections and the estimation of both longer term exploration targets and 2012 initial JORC compliant resources; and • Subsequent to the year end, a maiden drilling program at the Camel Creek Gold Project commenced comprising a total of 18 RC drill holes for a total of 2,518 metres. Significant results were returned from every hole highlighting the potential at Camel Creek and demonstrating the continuity of the gold mineralisation over an extensive strike length. Post the drilling at Camel Creek the drill rig moved to Big Rush to follow up and expand the previous drilling program. CAIRNS Georgetown CAMEL CREEK Greenvale BIG RUSH TOWNSVILLE GOLDEN CUP QUEENSLAND Figure 1: Camel Creek, Golden Cup and Big Rush Location Plan NT SA WA Brisbane QLD NSW Vic 6 Annual Report 2020 | Directors’ ReportGreat Northern Minerals s t c e o r P j Projects Golden Ant Project Acquisition: North Queensland Gold Projects During May 2019, Great Northern Minerals Limited entered into an option agreement to acquire a 100% interest in three gold projects in North Queensland (Figure 1) which had been previously mined by private earthmoving contractors and developers during the mid-1980s and 1990s. During this time period a large number of shallow oxide open pits at Camel Creek, Golden Cup and Big Rush were mined and subject to heap leach processing (Figure 2). Estimated gold recovery from the heap leach operations was estimated at be 60-70% with the remnant heap leach pads potentially containing economic quantities of remnant gold. Review and due diligence of the projects also outlined substantial potential for the delineation of gold resources underneath the previously mined shallow open pits, with a number of historical high grade gold drilling intercepts which had not been followed up. 7 Annual Report 2020 | Directors’ ReportGreat Northern MineralsTable 1: Historic Mining and Heap Leach Operations Deposit Camel Creek Camel Creek Satellites Golden Cup Golden Cup Satellites Big Rush TOTAL Ore Mined (tonnes) Grade (g/t Au) Ounces Mined 1,059,696 188,876 201,081 94,548 983,000 2,527,201 1.68 2.29 2.83 1.92 2.21 2.03 57,238 13,906 18,296 5,836 69,703 164,979 The original terms of the Heads of Agreement to acquire 12 months after the grant of Environmental Access up to a 100% interest in the Golden Ant Project were as in respect of the licences or 24 months after the follows; settlement; and • $20,000 cash option fee for a 60 day due diligence • Consultancy fees of $10,000 per month for a 12 month period; period following the settlement. • $5,000 cash option fee to extend the due diligence On 10 August 2020, the Company announced that a final period for a further 30 days; • $50,000 in cash and $50,000 in GPP shares to be issued upon decision to exercise the option; • $50,000 in cash and $100,000 in GPP shares to be issued upon estimation of JORC compliant Measured Mineral Resource of at least 100,000 ounces of gold at the Project; • $1,500,000 in cash upon estimation of a JORC compliant Measured Mineral Resource of at least 100,000 ounces of gold at the Project and either settlement of a 100% ownership in the three projects (no royalties) took place which was earlier than agreed. The parties to the Heads of Agreement entered into a deed of variation and mutually agreeing to reduce the agreed deferred and further deferred consideration via an early payment of $859,450, representing a discount of approximately 50% to the existing deferred and further deferred consideration totalling $1.732M and allowing an accelerated drilling and development program to be advanced. 8 Annual Report 2020 | Directors’ ReportGreat Northern MineralsFigure 2: Camel Creek, Golden Cup and Big Rush Geological Location Plan Figure 3: Golden Cup & Camel Creek Projects (325 square Figure 4: Big Rush Project (300 square kilometres) kilometres) 9 Annual Report 2020 | Directors’ ReportGreat Northern Mineralsh s u R g B i Golden Cup and Big Rush Drilling Program: December 2019 In December 2019, a first pass reverse circulation (RC) drilling program at Golden Cup and Big Rush was completed by Great Northern Minerals Limited. The aim of the program was to follow up and test a number of zones, where potential for additional gold resources was predicted based on the review of historic data. A total of 8 RC holes for 1042 metres were drilled at Big Rush targeting the Central Pit and a total of 8 RC holes for 639 metres were drilled at Golden Cup. Highlights from the drilling program included the following significant intersections. Big Rush: Significant Drill Results Golden Cup: Significant Drill Results • Hole BRRC1004: 5m @ 12.6 g/t Au from 92m • Hole GCRC074: 7m @ 7.49 g/t Au from 38m • Hole BRRC1006: 15m @ 2.4 g/t Au from 84m • Hole GCRC075: 6m @ 2.9 g/t Au from 39m • Hole BRRC1007: 28m @ 2.5 g/t Au from 83m • Hole GCRC076: 5m @ 1.93 g/t Au from 33m inc 15m @ 3.3 g/t Au from 83m • Hole BRRC1008: 3m @ 14.5 g/t Au from 118m • Hole BRRC1009: 24m @ 4.0 g/t Au from 97m and 2m @ 35.2 g/t Au from 113m • Hole GCRC077: 6m @ 1.89 g/t Au from 29m • Hole GCRC078: 9m @ 4.72 g/t Au from 35 m The mineralised intercepts in general correspond to logged intervals of quartz veining and elevated amounts of visual • Hole BRRC1010: 7m @ 2.45 g/t Au from 88m arsenopyrite, pyrite and stibnite. The assay results received correspond in tenor to nearby drill holes completed by previous holders of the project. 10 Annual Report 2020 | Directors’ ReportGreat Northern Minerals l e m a C k e e r C Camel Creek Drilling Post the reporting year end in July 2020 Great Northern • Hole CCRC005: 4m @ 5.41 g/t Au from 63m Minerals Limited commenced and completed its maiden reverse circulation drilling program at Camel Creek, totalling 18 holes for 2,516 metres. This was the first systematic deep drilling program completed under the shallow oxide pits of the Camel Creek gold mineralized system. Previous historic mining at Camel Creek had been conducted over approximately 3.5 kilometres of strike and this initial drilling program focused on an initial 700 metres of strike. Encouragingly every drill hole intersected the interpreted mineralized structure, with the better results summarized below. Camel Creek: Significant Drill Results • Hole CCRC012: 24m @ 3.55 g/t Au from 58m • Hole CCRC017: 8m @ 4.63 g/t Au from 85m • Hole CCRC015: 9m @ 4.99 g/t Au from 109m • Hole CCRC006: 4m @ 5.85 g/t Au from 88m • Hole CCRC016: 10m @2.14 g/t Au from 69m Encouragingly gold was encountered in every hole establishing strike continuity over 700 metres, with significant additional upside along strike and at depth. The new holes drilled, the majority of which will require follow up drilling, were all drilled into the primary zone below the base of oxidation with hole depths ranging from 65 to 197 metres, with an average depth of 140 metres. Two parallel zones were intersected in a number of holes highlighting multiple opportunities for further testing. An increase in quartz veining and sulphide content in general accompanies the anomalous intersections. A follow up RC drilling program is in the planning stages. No deep drilling has ever been completed at Camel Creek • Hole CCRC007: 8m @ 3.27 g/t Au from 147m previously and this systematic program highlighted the 11 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Figure 5: Plan Display - Camel Creek Drilling continuity of the mineralisation underneath the previously mined shallow open pits and demonstrated considerable additional potential. Interpretation of the results has suggested the presence of an untested target, termed the “Hinge Zone, where a number of the parallel structures coalesce. No previous mining has been conducted in this area and a plunging ore shoot is interpreted. The location coincides with a contact zone between sandstone and the siltstone/shale mylonite zone and is in the vicinity (and to the south) of the higher grades returned. This represents a new target of future drill testing. 12 Annual Report 2020 | Directors’ ReportGreat Northern Minerals p a e H h c a e L Heap Leach Pads In December 2019, the Company reported results from dumps consist of uncrushed oxide ore material whilst the sampling of heap leach dumps at the Company’s Golden Big Rush heap leach dump material was crushed prior to Ant Projects, including Camel Creek, Golden Cup and Big being stacked on the heap. The grab samples were taken Rush. as a first pass measure to assess if any gold remained in Fifteen grab samples were taken from the heap leach the heap leach dumps. dumps at Big Rush (6 samples), Camel Creek (5 samples) These assay results from the remnant heap leach pads are and Golden Cup (4 samples). Thirteen grab samples were not considered necessarily representative of the estimated hand-picked quartz vein material taken from the surface grade of the heap leach pads, but do provide support of the heap leach dumps while two samples (BRLPR003 for additional sampling and analytical work to assess the & BRLPR006 from Big Rush) were non-selective samples potential at reprocessing portions or all of the historic pads which included siltstone and shale fragments as well as and stockpiles. quartz vein material. The grab samples taken ranged between 2 – 3 kg and were analysed at ALS Laboratories in Townsville by Fire Assay. Ore sorting technologies may be particularly well suited to upgrading this material, on the basis that more gold is located in the quartz rich components (lighter coloured) of The three heap leach dumps formed part of open pit gold the heap leach pads and systematic drilling (or trenching) mining operations in the late 1980s to mid-1990s with gold and analysis is now required to fully assess their economic recovered from the heap leach dumps by cyanidation of potential, This work at Big Rush will commence in oxide ore. The Golden Cup and Camel Creek heap leach September 2020. Table 2: Assay results from selective grab sampling of heap leach dumps, Golden Ant Projects 13 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Leach Dump Location Sample ID Big Rush Big Rush Big Rush Big Rush Big Rush Big Rush Golden Cup Golden Cup Golden Cup Golden Cup Camel Creek Camel Creek Camel Creek Camel Creek Camel Creek BRLPR001 BRLPR002 BRLPR003 BRLPR004 BRLPR005 BRLPR006 GCLPR001 GCLPR002 GCLPR003 GCLPR004 CCLPR001 CCLPR002 CCLPR003 CCLPR004 CCLPR005 Easting 264958 264870 264875 265000 265053 265058 358580 358586 358589 358525 347826 347957 347911 347835 347794 14 Northing 7851930 Map Grid Au g/t GDA94 Zone 55 7851813 GDA94 Zone 55 7851818 GDA94 Zone 55 7851757 GDA94 Zone 55 7852009 GDA94 Zone 55 7852014 GDA94 Zone 55 7909440 GDA94 Zone 55 7909446 GDA94 Zone 55 7909449 GDA94 Zone 55 2.04 0.81 0.2 0.16 0.48 0.2 3.59 0.92 4.43 7909329 GDA94 Zone 55 11.35 7918085 GDA94 Zone 55 7918350 GDA94 Zone 55 7918336 GDA94 Zone 55 7918367 GDA94 Zone 55 7918423 GDA94 Zone 55 1.43 3.69 0.59 0.39 1.45 Annual Report 2020 | Directors’ ReportGreat Northern MineralsJORC 2012 Resource Estimates Exploration Targets During the reporting year Great Northern Minerals Limited completed work designed to evaluate “Exploration Targets” at its three gold projects, and also following the initial drilling programs and the validation of the historic drill results was able to release an initial inferred resource estimate at Golden Cup and Big Rush. Table 3: Golden Ant Project – Exploration Targets from surface down to 100m vertical depth Project Tonnes Grade (g/t Au) Ounces (Gold) Minimum Maximum Minimum Maximum Minimum Maximum Golden Cup 450,000 750,000 Camel Creek 500,000 1,000,000 Big Rush 1,800,000 3,600,000 3.5 2 2 5.5 3.5 3 50,643 32,154 115,756 132,637 112,540 347,267 The potential quantity and grade of the defined Exploration Target is conceptual in nature, there has been insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource. On 10 December 2019, the Company announced a JORC resource estimate for Golden Cup of 256,000 tonnes at 3.6 g/t Au for approximately 30,000 ounces of contained gold, using a 0.75g/t gold cut-off grade and on 7th February 2020 a gold mineral resource at Big Rush of 558,322 tonnes at 2.62 g/t Au for 47,006 ounces of contained gold was estimated above a 0.75 g/t Au cut-off grade and below the previously mined Central Pit. Both the Golden Cup and Big Rush mineral resource estimate were independently estimated by experienced resource geologist Andrew Beaton of AKB Mining Geology Services Pty Ltd (“AKB”), located in Townsville. The Company views these as initial resource estimates with additional drilling likely to increase both the size of the deposits and to also upgrade the JORC classification of the deposits. Table 4: Golden Ant Project: JORC 2012 Resources Project Golden Cup Big Rush TOTAL Tonnes 256,504 558,322 814,826 Grade (g/t Au) Ounces (Gold) 3.60 2.62 2.93 29,721 47,006 76,727 15 Annual Report 2020 | Directors’ ReportGreat Northern Mineralsk o o l t u O 2020 Outlook Following the purchase of the 100% interest in the North systematic large diameter aircore program is planned to Queensland Gold Projects, the Company commenced a collect representative samples of the remnant heap leach maiden drilling program at Camel Creek (results reported pad to assess its economic potential. Various screening above) and following the completion of the Camel Creek and size analysis is planned to accurately identify any drilling the drill rig was mobilized to Big Rush. potential size fraction which can be readily screened and beneficiated to obtain a higher grade component of the heap leach pad. The opportunity to use and test for advanced ore sorting technologies to upgrade the material into higher grade fractions is also being assessed. A large RC program at Big Rush commenced in the first week of August 2020, and was expected to encompass approximately 20 RC holes for 5200 metres of drilling. The drilling was designed to test at depth a number of potential mineralized zones interpreted to exist below the Central, Southern and Northern pits previously mined in the early 1990s.These pits collectively extend over two kilometres of strike, and the drilling is designed to test for extensions at depth and along strike. In addition, samples for metallurgical test work will be collected for initial sighter tests to determine optimum processing opportunities. A 16 Annual Report 2020 | Directors’ ReportGreat Northern MineralsCompetent persons statement The information in this report that relates to the Mineral Resource estimate is based on information compiled by Mr Andrew Beaton. Mr Beaton is a Member of the Australasian Institute of Mining and Metallurgy and is a part time consultant to Great Northern Minerals Ltd. Mr Beaton has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Beaton consents to the inclusion in the report of the matters based on their information in the form and context in which it appears. The information in this report that relates to Exploration Results is based on information compiled under the supervision of Simon Coxhell, the Technical Director of Great Northern Minerals Limited. Mr Coxhell is a member of the Australasian Institute of Mining and Metallurgy and has sufficient experience of relevance to the styles of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.” Mr Coxhell consents to the inclusion in this report of the matters based on his information in the form and context in which they appear. Corporate • On 5 August 2019, Alistair Williams resigned as a Non- Executive Director; • On 15 August 2019, the Company announced that it had exercised the option to the Heads of Agreement with Q-Generate Pty Ltd, to acquire the former gold producing mines of the Golden Ant Project in North Queensland; • On 19 August 2019, David Peterson resigned as Company Secretary and Aida Tabakovic was appointed as the Company Secretary; agreement of Ion Minerals Pty Ltd, for the Lincoln Springs project was terminated. • Following the Company’s General Meeting held on 18 October 2019 and ASIC approval, the Company changed its name to Great Northern Minerals Limited, and it’s ASX ticker code to GNM, effective from 27 November 2019; • On 28 October 2019, the Company consolidated its issued capital on a 10:1 basis; • On 25 November 2019, the Company announced that it has signed a Heads of Agreement (HoA) with private exploration company Gold Explorer Pty Ltd to earn an 80% interest in exploration permits EPM 26632 & 26652, located 140 km Northwest of Townsville in Queensland. In April 2020, the Company withdrew from the Joint Venture Agreement; • On 7 February 2020, the Company announced a maiden JORC-compliant mineral resource estimate for the Central Lode at the Big Rush Gold Mine in North Queensland. A gold mineral resource of 558,322 tonnes at 2.62 g/t Au for 47,006 ounces for GNM resource now to total 77,000 ounces; • On 21 February 2020, the Company announced that it has entered into a Deed of Surrender and Release with GCC Methane Pty Ltd of its 1.5% wellhead gas royalty to be derived from gas sales from WA Exploration Permit EP447 for surrender consideration in the amount of $125,000 (exclusive of GST). Both parties have agreed to terminate the Royalty Deed and to fully release each other from all claims, obligations and undertakings arising under the Royalty Deed; • During April 2020, the Company announced that it has executed a Heads of Agreement with NorthX Pty Ltd for an EPM application JV exploration permit surrounding Company’s current Camel Creek and Golden Cup Projects; • On 1 April 2020, Mr Gerard King resigned from his position as Non-Executive Chairman, on the same date Mr Kim Robinson was appointed as the incoming Non-Executive Chairman and Mr Simon Coxhell as a Technical Director; • During the year, Great Northern Minerals Limited • At the 12 May 2020 General Meeting of the (formerly Greenpower Energy Limited) acquisition shareholders a total of 21,000,000 GNMOF Listed 17 Annual Report 2020 | Directors’ ReportGreat Northern MineralsDirectors Options to Messers McLean, Robinson, $859,450, representing a discount of approximately Coxhell and Peters were approved and issued with 50% to the existing deferred and further deferred the purpose being a performance linked incentive consideration totalling $1.732M which completes Great component in the remuneration package (being for Northern’s 100% ownership of the Golden Ant Project. nil consideration) for the Board of Directors and to motivate and reward performance in their respective roles as Directors; • On 4 September 2020, the Company completed a placement via issuance of 80,521,786 fully paid ordinary shares, raising $1.52 million. The funds raised • The impact of the Coronavirus (‘COVID-19’) pandemic will be utilised to accelerate drilling at Company’s is ongoing for the consolidated entity up to 30 June Queensland gold projects and for general working 2020, it is not practicable to estimate the potential capital. impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided; • During the financial year, the Company spent $1,321,927 on exploration expenditure. Governance Arrangements • The Company also received commitments and support from Company Directors who collectively subscribed for $100,000 worth of New Shares, which are subject to shareholder approval at Company’s upcoming 2020 Annual General Meeting to be convened in due course. • The impact of the Coronavirus (‘COVID-19’) pandemic is ongoing for the consolidated entity up to 30 June 2020, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent The Company seeks to ensure the reporting of Mineral on measures imposed by the Australian Government Resources and Ore Reserves is in accordance with and other countries, such as maintaining social Industry best practice and Listing Rules. All current Mineral distancing requirements, quarantine, travel restrictions Resources and Ore Reserves have been compiled by and any economic stimulus that may be provided. independent consultants recognised for their expertise in the estimation of coal resources and reserves. The estimates have been reviewed by an independent consultant considered to be a Competent Person under the JORC Code 2012 to ensure that the resource reports comply with the listing rules. Matters Subsequent to the end of the Financial Year Likely developments and expected results of operations Further information, other than as disclosed in this report, about likely developments in the operations of the Company and the expected results of those operations in future periods has not been included in this report as disclosure of this information would be likely to result in There are no matters or circumstances which have arisen unreasonable prejudice to the Group. since the end of the year which will significantly affect, or may significantly affect, the state of affairs or operations of Non Audit Services the reporting entity in future financial years other than the There were no non audit services provided by the auditors following: • On 10 August 2020, the Company announced that it had signed a deed of variation to the Heads of during the year (2019: Nil). Auditors Independence Declaration Agreement to accelerate the completion of 100% The lead auditors’ independence declaration for the year ownership of the North Queensland gold projects. ended 30 June 2020 has been received and can be found The Parties to the Heads of Agreement have mutually on page 25 of the financial report. The auditor William Buck agreed to reduce the agreed deferred and further Audit (WA) Pty Ltd continues in office in accordance with deferred consideration via an early cash payment of Section 327 of the Corporations Act 2001. 18 Annual Report 2020 | Directors’ ReportGreat Northern MineralsEnvironmental Regulations The Group’s operations to date are not regulated by any significant environmental regulation under the law of the Commonwealth or of a state or territory. The Group must abide by the Environmental Protection Act 1994 of Queensland under which there are a number of regulations relevant to mining operations in that state. The Directors The Directors are committed to carefully utilising current resources, reviewing potentially markets for output, partners and other funding initiatives. Meeting of Directors During the financial year, 11 directors’ meetings were held. Attendances by each director during the year were as have considered compliance with the National Greenhouse follows: and Energy Reporting Act 2007 which requires entities to report on annual greenhouse gas emissions and energy use. For the measurement period 1 July 2019 to 30 June 2020 the directors have assessed that there are no current reporting requirements but may be required to do so in the future. Dividends Paid or Declared No dividends were paid or declared since the start of the financial year (2019: Nil). Company Secretary Directors’ Meetings Eligible to attend Number attended Mr Gerard King Mr Cameron McLean Mr Simon Peters Mr Simon Coxhell Mr Kim Robinson Mr Alistair Williams 8 11 11 3 3 1 8 11 11 3 3 1 The key management personnel of the Group consisted of Mr David Peterson was appointed as the Company the following directors and other persons: Secretary on 1 January 2019 and resigned on 19 August • Gerard King (Non-Executive Chairman) Resigned 1 2019. April 2020 Miss Aida Tabakovic was appointed as the Company • Simon Peters (Non-Executive Director) Secretary on 19 August 2019. Miss Tabakovic has over 11 years’ experience in the accounting profession. She holds a double degree in Accounting and Finance and • Kim Robinson (Non-Executive Chairman) Appointed 1 April 2020 a Postgraduate Degree in Business Law. Miss Tabakovic • Alistair Williams (Non-Executive Director) Resigned 5 provides services to a number of ASX listed companies August 2019 specialising in financial accounting and reporting and corporate compliance. Miss Tabakovic has also been involved in listing a number of junior exploration companies • Cameron McLean (CEO & Managing Director) • Simon Coxhell (Technical Director) Appointed 1 April on the ASX. Business Review Operating Results During the financial year, the Group recorded a consolidated loss of $3,336,423 (2019: $3,052,814) after providing for income tax. The expenditure reflected the exploration activities during the year at the Group’s Golden 2020 Remuneration Report (AUDITED) The information provided in this remuneration report has been audited as required by Section 308(3C) of the Corporations Act 2001. This report details the nature and amount of remuneration for each director of Great Northern Minerals Limited, and for the executives of the Group. Remuneration Policy Ant Project and its Deed of Surrender and Release of its Remuneration levels for the executives are competitively set wellhead Gas Royalty. to attract the most qualified and experienced candidates, taking into account prevailing market conditions and the 19 Annual Report 2020 | Directors’ ReportGreat Northern Mineralsindividual’s experience and qualifications. During the of their salary to increase payments towards period, the Group did not have a separately established superannuation. remuneration committee. The Board is responsible for determining and reviewing remuneration arrangements for the executive and non-executive Directors. • All remuneration paid to directors and executives is valued at the cost to the Group and expensed. Shares allocated to directors and executives are The remuneration policy of Great Northern Minerals valued as the difference between the market price Limited has been designed to align director and of those shares and the amount paid by the director executive objectives with shareholder and business or executive. Options are valued using appropriate objectives by providing a fixed remuneration component methodologies. for short-term incentives and offering specific long term incentives, based on key performance areas affecting the Group’s financial results. The board of Great Northern Minerals Limited believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best executives and directors to run and manage the Group, as well as create goal congruence between directors, executives and shareholders. • The board policy is to remunerate non-executive directors at market rates for comparable companies for time, commitment and responsibilities. The board determines payments to the non-executive directors and reviews their remuneration annually, based on market practice, duties and accountability. Independent external advice is sought when required. No such advice was obtained during The board’s policy for determining the nature and amount the year. Fees for non-executive directors are not of remuneration for the board members and senior linked to the performance of the Group. However, to executives of the Group is as follows: align directors’ interests with shareholder interests, • The remuneration policy, setting the terms and the directors are encouraged to hold shares in the conditions for the executive directors and other Company and can participate in the employee senior executives was developed by the board option plan. and legal advisors. All executives receive a base salary (which is based on factors such as length of Non-Executive Directors Remuneration service and experience) and superannuation where applicable. The board reviews executive packages annually by reference to the Group’s performance, executive performance and comparable information from industry sectors and other listed companies in similar industries. • The board may exercise discretion in relation to approving incentives, bonuses and options. The policy is designed to attract and retain the high calibre of executives and reward them for performance that results in long term growth in shareholder wealth. • Executives will also be entitled to participate in future employee share and option arrangements. • The executive directors and executives receive a superannuation guarantee contribution required by the government, which is currently 9.5%, and do not receive any other retirement benefits. Some individuals may choose to sacrifice part All Non-Executive Directors are entitled to receive $40,000 per annum for their roles as Directors of the Company. During the year the Chairman’s remuneration was amended to $50,000 per annum (2019: $120,000 per annum). The Company’s Constitution provides that the remuneration of Non-Executive Directors will not be more than the aggregate fixed sum determined by a general meeting. Before a determination is made by the Company in a general meeting, the aggregate sum of fees payable by the Company to the Non-Executive Directors is a maximum of $200,000 per annum, as approved at the 2018 Annual General Meeting. Summary details of remuneration of the Non-Executive Directors are provided in the table below. The remuneration is not dependent on the satisfaction of a performance condition. Directors are entitled to be paid reasonable travelling, accommodation and other expenses incurred in consequence of their attendance at meetings of Directors 20 Annual Report 2020 | Directors’ ReportGreat Northern Mineralsand otherwise in the execution of their duties as Directors. Share Based Compensation During the year, a total of 21,000,00 listed options (2019: nil) were granted to directors of Great Northern Minerals Limited as approved by shareholders, as a cost effective and efficient way to incentivise and reward the directors as opposed to alternative forms of incentives. No additional options over shares in Great Northern Minerals Limited were granted during the year. The options issued during the 2020 financial year were issued to provide long term incentives for executives and consultants to deliver long term shareholder returns. During the year no ordinary shares in the Company (2019: Nil) were issued as a result of the exercise of remuneration options to directors of Great Northern Minerals Limited or other key management personnel of the group. Additional information No performance-based bonuses have been paid to key management personnel during the financial year. It is the intent of the board to include performance bonuses as part of remuneration packages when mine production commences. A Director may also be paid additional amounts as fees or as the Directors determine where a Director performs extra services or makes any special exertions, which in the option of the Directors are outside the scope of the ordinary duties of a Director. Other Executives Remuneration Mr Cameron McLean CEO & Managing Director (appointed 12 October 2018) Mr McLean’s employment terms are governed by a Service Agreement. The terms of the agreement can be terminated by either party providing three months written notice. Mr McLean is entitled to receive Director’s Fee of $200,000 per annum (exclusive of statutory superannuation). Mr Simon Coxhell Technical Director (appointed 1 April 2020) Mr Coxhell’s employment terms are governed by a Service Agreement. The terms of the agreement can be terminated by either party providing three months written notice. Mr Coxhell is entitled to receive Director’s Fee of $200,000 per annum (exclusive of statutory superannuation). On termination, the Executives are entitled to be paid those outstanding amounts owing to the Executives for the period up until the Termination Date. The Executives do not have any entitlement to any payment relating to any period after the Termination Date. Subject to the ASX Listing Rules and the Corporations Act 2001, if the appointment of the Executive is terminated as a result of a change in control of the Company, the Company will pay to the Executive three months’ worth of Executive Service Fees as liquidated damages for the Executive’s loss of engagement. If the Corporations Act 2001 or the ASX Listing Rules restricts the amount that can be paid to the Executive on termination to an amount less than that calculated, then the amount can be paid under the Corporations Act 2001 and the ASX Listing Rules without approval of the Company’s shareholders. 21 Annual Report 2020 | Directors’ ReportGreat Northern MineralsDetails of Remuneration Details of remuneration of the directors and key management personnel of the group are set out below: Post- Short-term employment Benefits Benefits Share-based Payments Cash fees Super- and salary annuation Equity Options/ Rights (vi) Share-based Payments as a percent- age of Re- Total muneration Year $ $ $ $ $ % Perfor- mance Related % Non-Executive Directors Gerard King (i) 2020 Kim Robinson (ii) Simon Peters Alistair Williams (iii) Matthew Suttling (iv) Sub-Total Non- Executive Directors Executive Directors Cameron McLean Simon Coxhell (v) 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 65,753 120,000 12,500 - 50,000 48,658 9,167 35,416 - 66,500 137,420 270,574 187,500 150,000 37,500 - Sub-Total Executives 2020 225,000 2019 2020 2019 150,000 362,420 420,574 6,247 - - - - - - - - - 6,247 - 17,812 14,250 3,562 - 21,374 14,250 27,621 14,250 - - - - - - - - - - - - - - - - - - - - - - 72,000 120,000 13,080 25,580 - 6,540 - - - - - - 56,540 48,658 9,167 35,416 - 66,500 - - 51.13 - 11.57 - - - - - 19,620 163,287 - - 270,574 - 13,080 218,392 - 164,250 13,080 54,142 - - 5.99 - 24.16 - 26,160 272,534 - - 164,250 - 45,780 435,821 - 434,824 - - - - - - - - - - - - - - - - - - - - - - TOTAL (i) (ii) (iii) (iv) (v) (vi) Mr King resigned as a Non-Executive Chairman on 1 April 2020. Mr Robinson was appointed as a Non-Executive Chairman on 1 April 2020. Mr Williams resigned as a Non-Executive Director on 5 August 2019. Mr Suttling resigned as a Non-Executive Director on 12 October 2018. Mr Coxhell was appointed as a Technical Director on 1 April 2020. Value of options were calculated using Black-Scholes Model. 22 Annual Report 2020 | Directors’ ReportGreat Northern Minerals The following table provides employment details of Energy Limited) acquisition of Ion Minerals Pty Ltd. persons who were, during the financial year, members of On 13 November 2019, the Company fully settled key management personnel of the Group. The table also the balance outstanding of $13,395. The terms of the illustrates the proportion of remuneration that was fixed and transaction were on a no interest basis. Balance owing at risk. to Alistair Williams as at 30 June 2019 was Nil. • During the financial year, Mineral Intelligence Pty Ltd, a Company which Managing Director, Cameron McLean has an interest in, loaned $11,000 to Ion Minerals Pty Ltd. The terms of the transaction were on a no interest basis. The balance outstanding and payable to Mineral Intelligence Pty Ltd by Ion Minerals Pty Ltd as at 30 June 2019 is $11,000. Subsequent to the year end, the funds are yet to be repaid to Mineral Intelligence Pty Ltd. • During the financial year, Mineral Intelligence Pty Ltd, a Company which Managing Director Cameron McLean has an interest in, was loaned by Great Northern Minerals Limited (previously Greenpower Energy Limited) an amount of $2,594. The terms of the transaction were on a no interest basis. The balance payable by Mineral Intelligence as at 30 June 2019 was $2,594. Subsequent to the year end, the funds are yet to be repaid from Mineral Intelligence Pty Ltd. Directors Fixed At Risk Remuneration Long Term Gerard King Cameron McLean Alistair Williams Simon Peters Simon Coxhell Kim Robinson % 100 100 100 100 100 100 Remuneration % - - - - - - Other transactions with Key Management Personnel There were no Key Management personnel related party transactions during the current financial year except for: 2020 • During the financial year, Mineral Intelligence Pty Ltd, a Company which Managing Director Cameron McLean has an interest in, was loaned by Great Northern Minerals Limited an amount of $2,873. The terms of the transaction were on a no interest basis. The balance payable by Mineral Intelligence to Great Northern Minerals Limited as at 30 June 2020 was $5,467. Subsequent to the year end, the funds are yet to be repaid from Mineral Intelligence Pty Ltd. • During 2019 financial year, Mineral Intelligence Pty Ltd, a Company which Managing Director, Cameron McLean has an interest in, loaned $11,000 to Ion Minerals Pty Ltd. The terms of the transaction were on a no interest basis. The balance outstanding and payable to Mineral Intelligence Pty Ltd by Ion Minerals Pty Ltd as at 30 June 2020is $11,000. The funds are yet to be repaid to Mineral Intelligence Pty Ltd. 2019 • During the financial year, Ion Minerals Pty Ltd repaid the outstanding loan balance it had owing to Director, Alistair Williams, which was the balance brought over from previous period and was still owing upon Great Northern Minerals Limited’s (previously Greenpower 23 Annual Report 2020 | Directors’ ReportGreat Northern MineralsKey Management Personnel Shareholdings The number of ordinary shares in Great Northern Minerals Limited held by each key management person of the Group during the financial year is as follows: 30 June 2020 Balance at begin- ning of year Consolidation of issued capital (iv) Other changes during the period (v) Balance at resig- nation date Balance at end of year Directors Gerard King (i) Cameron McLean Alistair Williams (ii) Simon Peters Simon Coxhell (iii) Kim Robinson (iii) 165,785,208 (149,206,688) - 16,578,520 - 62,535,000 (56,281,500) 5,776,750 - 12,030,250 51,500,000 - 1,228,846 (17,980,962) 9,375,000 19,149,577 - - - - - - 60,875,000 - - - - 2,397,461 - - 281,049,054 (223,469,150) 34,301,327 77,453,520 14,427,711 (i) (ii) (iii) (iv) (v) Mr King resigned on 1 April 2020. Mr Williams resigned on 5 August 2019. Messrs Coxhell and Robinson were appointed on 1 April 2020. On 28 October 2019, the Company consolidated its issued capital on 10:1 basis. On-market acquisitions, participation in Share Purchase Plan (’SPP) and Non-Renounceable Rights Issues. Options over Equity Instruments Granted as Compensation Details of Options over ordinary shares in the Company that were granted as $Nil consideration compensation to Key Management Personnel during the 2020 (2019: Nil) financial year are as follows: Directors Grant Date Number Fair Value per Exercise Price Expiry Date Granted Option ($) ($) Number Vested Cameron McLean 12/05/2020 6,000,000 Simon Peters 12/05/2020 3,000,000 Kim Robinson 12/05/2020 6,000,000 Simon Coxhell 12/05/2020 6,000,000 0.00218 0.00218 0.00218 0.00218 0.01 0.01 0.01 0.01 01/11/2022 6,000,000 01/11/2022 3,000,000 01/11/2022 6,000,000 01/11/2022 6,000,000 The options have been valued using Black Scholes methodology, the Black Scholes assumptions and details are outlined below: Options Number of options in series 21,000,000 Underlying share price ($) 0.005 Exercise price ($) Expected volatility (%) Option life Expiry date 0.01 100 2 years 1 November 2022 Dividend yield (%) Risk free interest rate (%) Nil 0.54 24 Annual Report 2020 | Directors’ ReportGreat Northern MineralsKey Management Personnel Options Holdings The number of options over ordinary shares held during the year by each Key Management Personnel is as follows: Opening Balance Granted during the period Exercised during the period Other chang- es during the period Balance at end of period Vested and Exercisable Vested and Un-exercis- able Gerard King (i) 2,769,230 - Cameron McLean Alistair Williams (ii) - - 6,000,000 - Simon Peters 2,769,230 3,000,000 Simon Coxhell (iii) Kim Robinson (iii) - - 6,000,000 6,000,000 5,538,460 21,000,000 (i) Mr King resigned on 1 April 2020. (ii) Mr Williams resigned on 5 August 2019. - - - - - - - (2,415,384)(iv) 353,846 353,846 1,563,375(v) 7,563,375 7,563,375 - - - (2,292,518)(iv) 3,476,712 3,476,712 - - 6,000,000 6,000,000 6,000,000 6,000,000 (3,144,527) 23,393,933 23,393,933 - - - - - - (iii) Messrs Coxhell and Robinson were appointed on 1 April 2020. (iv) On 28 October 2019, the Company consolidated its issued capital on 10:1 basis. (v) Participation in Non-Renounceable Rights Issue per Prospectus dated 1 November 2019; participation in Non- Renounceable Rights Issue per Prospectus dated 25 March 2020; Directors’ Options as approved at General Meeting held 12 May 2020. No options have been granted to the directors or KMP since the end of the financial year. Options granted carry no dividend or voting rights. When exercisable, each option is convertible into one fully paid ordinary share. Refer to the above tables for the exercise price of the options. Performance-based Remuneration The Group currently has no performance-based remuneration component built into director and executive remuneration packages due to the stage of the Group’s development, as such no link between remuneration and financial performance currently exists. The table below sets out summary information about the Group’s earnings and movement in share price for the five years to 30 June 2020: Income Net loss before tax 2020 $ 2019 $ 2018 $ 2017 $ 2016 $ 315,861 498,997 290,357 49,659 12,418 (3,336,423) (3,052,814) (5,026,320) (2,411,036) (2,873,530) Net loss after tax benefit (3,336,423) (3,052,814) (5,026,320) (2,320,120) (2,873,530) Share Price at end of year (cents) Basic and diluted loss per share (cents)* 0.019 (0.76) 0.1 (1.57) 0.5 (4.50) 0.2 (2.50) 0.5 (8.70) *Calculated on a post-consolidation basis. End of Audited Remuneration Report 25 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Indemnifying Officers or Auditors No indemnities have been given or insurance premiums paid, during or since the end of the financial year, for any person who is or has been an officer or auditor of the Group. Auditors’ Independence Declaration The lead auditors’ independence declaration for the year ended 30 June 2020 has been received and can be found on page 23 of the financial report. Great Northern Minerals Limited Proceedings on Behalf of Company ABN 22 000 002 111 No person has applied for leave of Court under s237 of the Corporations Act 2001 to bring proceedings on behalf of the Directors' Declaration 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 period. In accordance with a resolution of the directors of Great Northern Minerals Limited, the directors of the company declare that: Options 1. the financial statements, notes and the remuneration report in the Directors’ Report are in accordance with the Corporations Act 2001, including: Unissued shares under option At the date of this report, the unissued ordinary shares of Great Northern Minerals Limited under option are as follows: giving a true and fair view of the financial position of the Consolidated Group as at 30 June 2020 and of its performance for the year ended on that date; and a. Details b. complying with Australian Accounting Standards (including International Financial Reporting Standards) and the Corporations Regulations 2001; Number of Option Holders Number under Option Exercise Price Expiry Date Unlisted 2. Listed Listed 27/10/2020 $0.30 1,600,000 in the directors' opinion, there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable. 15/12/2021 18,578,678 $0.18 172 8 01/11/2022 $0.01 238,528,099 192 Listed This declaration has been made after receiving the declarations required to be made to the directors in accordance with sections of 295A of the Corporations Act 2001. 102,522,431 01/07/2023 $0.022 150 This declaration is made in accordance with a resolution of the Board of Directors. 361,229,208 522 This report is signed in accordance with a resolution of the Board of Directors: ................................................................................. .................................................................. Kim Robinson Chairman Kim Robinson Chairman Dated this 29 September 2020 Dated: 29 September 2020 26 59 Annual Report 2020 | Directors’ ReportGreat Northern Minerals AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001 TO THE DIRECTORS OF GREAT NORTHERN MINERALS LIMITED I declare that, to the best of my knowledge and belief during the year ended 30 June 2020 there have been: — no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and — no contraventions of any applicable code of professional conduct in relation to the audit. William Buck Audit (WA) Pty Ltd ABN 67 125 012 124 Robin Judd Director Dated this 29th day of September 2020 27 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Financial Report 28 Annual Report 2020 | Financial ReportGreat Northern MineralsGreat Northern Minerals Limited ABN 22 000 002 111 Consolidated Statement of Profit or Loss and Other Comprehensive Income For the Year Ended 30 June 2020 Other income Interest income Occupancy costs Depreciation and amortization Corporate and administration expenses Exploration and tenement costs Impairment of tenements Fair value change in equity instruments Impairment loss on financial assets Impairment on investment accounted for using equity method Impairment of receivables Write down in net assets of associates Net Loss before income tax Income tax (expense)/benefit Net Loss after income tax Note 4 10,11 5 13 2020 $ 314,487 1,375 - (56,834) (1,196,391) (1,321,927) (948,133) - - - (129,000) - 2019 $ 484,144 14,853 (52,107) (14,454) (1,631,159) (1,258,720) (125,000) (16,666) (16,667) (21,036) - (416,002) (3,336,423) - (3,052,814) - (3,336,423) (3,052,814) Net Loss attributable to owners of Great Northern Minerals Limited (3,336,423) (3,052,814) Other comprehensive income: Items that will not be subsequently recognised in profit or loss Other comprehensive income for the year, net of tax Total comprehensive loss for the year Loss for the year is attributable to: Owners of Great Northern Minerals Limited Non-controlling interest Total comprehensive loss for the year Total comprehensive loss for the year attributable to Owners of Great Northern Minerals Limited Total comprehensive loss for the year attributable to Non-Controlling Interest - - (3,336,423) (3,052,814) (2,722,903) (613,520) (2,451,005) (601,809) (3,336,423) (3,052,814) (2,722,903) (2,451,005) (613,520) (601,809) Attributable to owners of Great Northern Minerals Limited: Basic loss per share (cents per share) Diluted loss per share (cents per share) 7 7 (0.76) (0.76) (1.57) (1.57) The above consolidated income statement should be read in conjunction with the accompanying notes. 26 29 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Consolidated Statement of Financial Position As at 30 June 2020 Note 2020 $ 2019 $ ASSETS CURRENT ASSETS Cash and cash equivalents Trade and other receivables Prepayments TOTAL CURRENT ASSETS NON-CURRENT ASSETS Plant and equipment Intangible assets Right of Use asset Exploration and evaluation assets TOTAL NON-CURRENT ASSETS TOTAL ASSETS LIABILITIES CURRENT LIABILITIES Trade and other payables Lease liabilities Deferred consideration TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Lease liabilities TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Contributed equity Reserves Accumulated losses Equity attributable to owners of the Parent Entity Non-controlling interest (60% Ion Minerals) 8 9 10 11 13 14 11 13 11 15 16 17 17 2,510,058 259,440 20,308 222,277 486,412 17,017 2,789,806 725,706 101,951 39 98,375 562,076 123,930 2,774 - 948,133 762,441 1,074,837 3,552,247 1,800,543 543,352 27,397 150,000 470,817 - - 720,749 470,817 75,240 75,240 - - 795,989 470,817 2,756,258 1,329,726 79,834,625 295,056 75,182,850 349,212 (76,158,094) (73,600,527) 1,931,535 (601,809) 3,971,587 (1,215,329) TOTAL EQUITY 2,756,258 1,329,726 The above consolidated statement of financial position should be read in conjunction with the accompanying notes. 30 27 Annual Report 2020 | Financial ReportGreat Northern Minerals l B a a n c e a t 3 0 J u n e 2 0 2 0 7 9 , 8 3 4 , 6 2 5 2 9 5 , 0 5 6 O p t i o n s e x p i r e d d u r i n g t h e y e a r I s s u e o f O p t i o n s d u r i n g t h e y e a r d i r e c t l y i n e q u i t y T r a n s a c t i o n w i t h o w n e r s , r e c o r d e d t h e y e a r T o t a l c o m p r e h e n s v e i i n c o m e f o r c o s t s ) S h a r e s i s s u e d d u r i n g t h e y e a r ( n e t o f L o s s f o r t h e y e a r l B a a n c e a t 1 l J u y 2 0 1 9 t O h e r c o m p r e h e n s v e i i n c o m e : 4 , 6 5 1 , 7 7 5 - - - - - 7 5 , 1 8 2 , 8 5 0 3 4 9 , 2 1 2 - - ( 1 6 5 , 3 3 6 ) 1 1 1 , 1 8 0 - - - - - - - ( 7 7 , 3 7 3 , 4 2 3 ) 3 , 9 7 1 , 5 8 7 ( 1 , 2 1 5 , 3 2 9 ) 1 6 5 , 3 3 6 - - 4 , 6 5 1 , 7 7 5 1 1 1 , 1 8 0 - - - - ( 3 , 3 3 6 , 4 2 3 ) ( 2 , 7 2 2 , 9 0 3 ) ( 6 1 3 , 5 2 0 ) ( 7 4 , 2 0 2 , 3 3 6 ) 1 , 9 3 1 , 5 3 5 ( 3 , 3 3 6 , 4 2 3 ) ( 2 , 7 2 2 , 9 0 3 ) ( 6 1 3 , 5 2 0 ) ( 6 0 1 , 8 0 9 ) 2 8 T h e a b o v e c o n s o l i d a t e d s t a t e m e n t o f c h a n g e s i n e q u i t y l s h o u d b e r e a d i j n c o n u n c t i o n w i t h t h e a c c o m p a n y n g i n o t e s . , 2 7 5 6 2 5 8 , 1 1 1 , 1 8 0 - , 4 6 5 1 7 7 5 , , 1 3 2 9 7 2 6 , , ( 3 3 3 6 , , ( 3 3 3 6 , 4 2 3 ) 4 2 3 ) 31 G r e a t N o r t h e r n M n e r a l s L m i i i t e d 2 0 2 0 A B N 2 2 0 0 0 0 0 2 1 1 1 F o r t h e Y e a r E n d e d 3 0 J u n e 2 0 2 0 C o n s o l i d a t e d S t a t e m e n t o f C h a n g e s i n E q u i t y E q u i t y C o n t r i b u t e d R e s e r v e P a y m e n t s S h a r e B a s e d $ $ $ $ A s s e t s R e s e r v e L o s s e s $ P a r e n t $ I n t e r e s t $ T o t a l i F n a n c i a l A c c u m u l a t e d O w n e r s o f c o n t r o l l i n g A t t r i b u t a b l e t o N o n - Annual Report 2020 | Financial ReportGreat Northern Minerals 2 9 T h e a b o v e c o n s o l i d a t e d s t a t e m e n t o f c h a n g e s i n e q u i t y s h o u d b e l r e a d i j n c o n u n c t i o n w i t h t h e a c c o m p a n y n g i n o t e s . t o o p e n n g i l b a a n c e ( A A S B 9 ) - - ( 1 4 , 6 6 6 ) 1 4 , 6 6 6 - l B a a n c e a t 1 l J u y 2 0 1 8 N e w a c c o u n t i n g s t a n d a r d j a d u s t m e n t 7 4 , 1 2 6 , 5 2 4 7 1 6 , 8 5 7 1 4 , 6 6 6 ( 7 1 , 5 3 1 , 8 3 3 ) 3 , 3 2 6 , 2 1 4 G r e a t N o r t h e r n M n e r a l s L m i i i t e d 2 0 1 9 A B N 2 2 0 0 0 0 0 2 1 1 1 F o r t h e Y e a r E n d e d 3 0 J u n e 2 0 2 0 C o n s o l i d a t e d S t a t e m e n t o f C h a n g e s i n E q u i t y $ $ $ $ $ $ E q u i t y C o n t r i b u t e d R e s e r v e P a y m e n t s S h a r e B a s e d A s s e t s R e s e r v e L o s s e s P a r e n t I n t e r e s t i F n a n c i a l A c c u m u l a t e d O w n e r s o f c o n t r o l l i n g A t t r i b u t a b l e t o N o n - $ T o t a l - - - , 3 3 2 6 2 1 4 , , 3 3 2 6 2 1 4 , - l B a a n c e a t 3 0 J u n e 2 0 1 9 7 5 , 1 8 2 , 8 5 0 3 4 9 , 2 1 2 O p t i o n s e x p i r e d d u r i n g t h e y e a r - ( 3 6 7 , 6 4 5 ) L o s s f o r t h e y e a r R e s t a t e d a t 1 J u y 2 0 1 8 l c o s t s ) d i r e c t l y i n e q u i t y T r a n s a c t i o n w i t h o w n e r s , r e c o r d e d S h a r e s i s s u e d d u r i n g t h e y e a r ( n e t o f t h e y e a r t O h e r c o m p r e h e n s v e i i n c o m e : T o t a l c o m p r e h e n s i v e i n c o m e f o r 1 , 0 5 6 , 3 2 6 - - - - 7 4 , 1 2 6 , 5 2 4 7 1 6 , 8 5 7 - - - - - - ( 7 1 , 5 1 7 , 1 6 7 ) 3 , 3 2 6 , 2 1 4 ( 7 4 , 2 0 2 , 3 3 6 ) 1 , 9 3 1 , 5 3 5 ( 6 0 1 , 8 0 9 ) 3 6 7 , 6 4 5 - - 1 , 0 5 6 , 3 2 6 - - ( 3 , 0 5 2 , 8 1 4 ) ( 2 , 4 5 1 , 0 0 5 ) ( 6 0 1 , 8 0 9 ) ( 3 , 0 5 2 , 8 1 4 ) ( 2 , 4 5 1 , 0 0 5 ) ( 6 0 1 , 8 0 9 ) , 1 3 2 9 7 2 6 , , 1 0 5 6 3 2 6 , - , ( 3 0 5 2 , , ( 3 0 5 2 , 8 1 4 ) 8 1 4 ) 32 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Consolidated Statement of Cash Flows For the Year Ended 30 June 2020 CASH FLOWS FROM OPERATING ACTIVITIES: Payments to suppliers and employees Payments for exploration and evaluation Interest received Interest paid R&D refund received Proceeds from sale/release of royalty Note 2020 $ 2019 $ (1,043,771) (1,532,836) 3,397 (6,129) 223,835 159,500 (2,989,377) - 14,853 - 281,754 125,000 Net cash outflow in operating activities 18(a) (2,196,004) (2,567,770) CASH FLOWS FROM INVESTING ACTIVITIES: Acquisition of exploration assets/tenements Acquisition of exploration assets as part of Ion Minerals acquisition Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Other – Cash on acquisition of subsidiary Net cash outflow from investing activities CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issue of shares and options Transaction costs Proceeds from borrowings Repayment of borrowings Repayment of lease liabilities Net cash inflows from financing activities (85,000) - (4,407) 800 - (647,460) (510,000) (134,854) - 210,021 (88,607) (1,082,293) 5,189,820 (588,345) 8,000 (8,000) (29,083) 604,539 (153,777) 100,000 (100,000) - 4,572,392 450,762 Net increase (decrease) in cash and cash equivalents held Cash and cash equivalents at beginning of year Cash and cash equivalents at end of financial year 2,287,781 222,277 (3,199,301) 3,421,578 8 2,510,058 222,277 The above consolidated statement of cash flows should be read in conjunction with the accompanying notes. 33 30 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 1 Corporate Information The consolidated financial report of Great Northern Minerals Limited (previously Greenpower Energy Limited) for the year ended 30 June 2020 was authorised for issue in accordance with a resolution of the Directors on 29 September 2020 and covers Great Northern Minerals Limited as an individual entity as well as the consolidated entity consisting of Great Northern Minerals Limited and its subsidiaries (‘Group’) as required by the Corporations Act 2001. The financial report is presented in the Australian currency. Great Northern Minerals Limited is a for profit company limited by shares incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange. 2 Summary of Significant Accounting Policies (a) Basis of Preparation The financial report is a general purpose financial statement that has been prepared in accordance with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report containing relevant and reliable information about transactions, events and conditions. The financial statements and notes comply with International Financial Reporting Standards. Material accounting policies adopted in the preparation of this financial report are presented below and have been consistently applied unless otherwise stated. The financial report has been prepared on an accruals basis and is based on historical costs, modified, where applicable, by the measurement at fair value of financial assets. (b) Principles of Consolidation Subsidiaries The Group financial statements consolidate those of Great Northern Minerals Limited (‘Parent’), and all of its subsidiaries as of 30 June 2020. The Parent controls a subsidiary if it is exposed, or has rights, to variable returns from its involvement with the subsidiary and has the ability to affect those returns through its power over the subsidiary. All transactions and balances between Group companies are eliminated on consolidation, including unrealised gains and losses on transactions between Group companies. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Group. Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are recognised from the effective date of acquisition, or up to the effective date of disposal, as applicable. Subsidiaries are accounted for in the Parent financial statements at cost. A list of subsidiary entities is contained in Note 12 to the financial statements. All subsidiaries have a 30 June financial year end. 31 34 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 (c) Segment Reporting Operating segments are reported in a manner consistent with the internal reporting provided to the Directors. The Directors are responsible for allocating resources and assessing the performance of the operating segments. (d) Income Tax The income tax expense for the period is the tax payable on the current period's taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences between the tax base of assets and liabilities and their carrying amounts in the financial statements, and to unused tax losses. Deferred tax assets and liabilities are recognised for all temporary differences, between carrying amounts of assets and liabilities for financial reporting purposes and their respective tax bases, at the tax rates expected to apply when the assets are recovered or liabilities settled, based on those tax rates which are enacted or substantively enacted for each jurisdiction. Exceptions are made for certain temporary differences arising on initial recognition of an asset or a liability if they arose in a transaction, other than a business combination, that at the time of the transaction did not affect either accounting profit or taxable profit. Deferred tax assets are only recognised for deductible temporary differences and unused tax losses if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. Deferred tax assets and liabilities are not recognised for temporary differences between the carrying amount and tax bases of investments in subsidiaries, associates and interests in joint ventures 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. Great Northern Minerals Limited and its wholly owned subsidiaries have implemented the tax consolidation legislation. As a consequence, these entities are taxed as a single entity and the deferred tax assets and liabilities of these entities are set off in the consolidated financial statements. Current and deferred tax is recognised in profit or loss except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity. (e) Impairment of Assets At each reporting date the Group assesses whether there is any indication that individual assets are impaired. Where impairment indicators exist, the recoverable amount is determined, and impairment losses are recognised in the Consolidated Statement of Profit or Loss and Other Comprehensive Income where the asset's carrying value 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 purpose of assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Where it is not possible to estimate the recoverable amount for an individual asset, recoverable amount is determined for the cash generating unit to which the asset belongs. 32 35 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 (f) Cash and Cash Equivalents For the purposes of the Statement of Cash Flows, cash and cash equivalents includes cash on hand and at bank, deposits held at call with financial institutions, other short term, highly liquid investments with maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value and bank overdrafts. (g) Property, Plant and Equipment Each class of plant and equipment is carried at cost as indicated less, where applicable, any accumulated depreciation and impairment losses. Cost includes expenditure that is directly attributable to the asset. The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the asset's employment and subsequent disposal. The expected net cash flows have not been discounted to their present values in determining recoverable amounts. Depreciation The depreciable amount of all fixed assets is depreciated on a straight-line basis over the asset's useful life to the Group commencing from the time the asset is held ready for use. Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate. Depreciation on other assets is calculated on a straight-line basis over the estimated useful life of the asset as follows: Class of Asset Office Equipment (h) Right-of-Use Assets 3-10 Years A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset. Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter. Where the consolidated entity expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-of-use assets are subject to impairment or adjusted for any remeasurement of lease liabilities. The right-of-use asset will be depreciated on a straight-line basis over the unexpired period of the lease. The asset will be subjected to impairment or adjusted for any remeasurement of lease liabilities. 33 36 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 (i) Exploration and Evaluation Assets Exploration and evaluation expenditure is generally written off in the year it is incurred, except for acquisition costs which are carried forward where right to tenure of the area of interest (i.e. tenement) is current and is expected to be recouped through sale or successful development and exploitation of the area of interest, or where exploration and evaluation activities in the area of interest have not reached a stage that permits reasonable assessment of the existence of 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 the area of interest. The carrying value of any capitalised expenditure is assessed by the Directors each year to determine if any provision should be made for the impairment of the carrying value. The appropriateness of the Group’s ability to recover these capitalised costs has been assessed at year end and the Directors are satisfied that the value is recoverable. The carrying value of exploration and evaluation expenditure assets are assessed for impairment at an overall level whenever facts and circumstances suggest that the carrying amount of the assets may exceed recoverable amount. An impairment exists when the carrying amount of the assets exceed the estimated recoverable amount. The assets are then written down to their recoverable amount. Any impairment losses are recognised in the income statement. (j) Fair Value Measurement When an asset or liability, financial or non-financial is measures at fair value for recognition or disclosure purposes, the fair value is based on 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; and assumes that the transaction will take place either; in the principal market; or in the absence of a principal market, in the most advantageous market. Fair value is measured using the assumptions that market participants would use when pricing the asset or liability assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. Assets and liabilities measured at fair value are classified, into three levels, using a fair value hierarchy based on the lowest level of input that is significant to the entire fair value measurement, being; level 1, quoted prices in active markets for identical assets or liabilities that the entity can access at the measurement date; level 2, inputs other than quoted prices included within level 1 that are observable for the assets or liabilities, either directly or indirectly; and level 3, unobservable inputs for the assets and liabilities. Classifications are reviewed at each reporting date and transfers between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value measurement. For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where applicable, with external sources of data. 34 37 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 (k) Investments and Other Financial Assets Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either amortised cost or fair value depending on their classification. Classification is determined based on both the business model within which such assets are held and the contractual cash flow characteristics of the financial asset unless, an accounting mismatch is being avoided. Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of recovering part or all of a financial asset, it's carrying value is written off. Financial assets at fair value through profit or loss Financial assets not measured at amortised cost or at fair value through other comprehensive income are classified as financial assets at fair value through profit or loss. Typically, such financial assets will be either: (i) held for trading, where they are acquired for the purpose of selling in the short-term with an intention of making a profit, or a derivative; or (ii) designated as such upon initial recognition where permitted. Fair value movements are recognised in profit or loss. Financial assets at fair value through other comprehensive income Financial assets at fair value through other comprehensive income include equity investments which the Group intends to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition. Impairment of financial assets The Group recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon the Group's assessment at the end of each reporting period as to whether the financial instrument's credit risk has increased significantly since initial recognition, based on reasonable and supportable information that is available, without undue cost or effort to obtain. Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate. For financial assets measured at fair value through other comprehensive income, the loss allowance is recognised within other comprehensive income. In all other cases, the loss allowance is recognised in profit or loss. Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate. For financial assets measured at fair value through other comprehensive income, the loss allowance is recognised within other comprehensive income. In all other cases, the loss allowance is recognised in profit or loss. 38 35 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 (l) Trade and Other Receivables Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days. The Company has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue. (m) Lease Liabilities A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the consolidated entity's incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred. Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset is fully written down. (n) Trade and Other Payables Trade and other payables represent liabilities for goods and services provided to the Group prior to the year end and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition. (o) Contributed Equity Ordinary shares are classified as equity. Costs directly attributable to the issue of new shares are shown as a deduction from the equity proceeds, net of any income tax benefit. Costs directly attributable to the issue of new shares associated with the acquisition of a business are included as part of the purchase consideration. (p) Earnings per Share Basic Earnings per Share Basic earnings per share is calculated by dividing the profit attributable to owners of Great Northern Minerals Limited by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares during the year. 36 39 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 (p) Earnings per Share (continued) Diluted Earnings per Share Earnings used to calculate diluted earnings per share are calculated by adjusting the basic earnings by the after-tax effect of dividends and interest associated with dilutive potential ordinary shares. The weighted average number of shares used is adjusted for the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares. (q) Revenue The Company recognises revenue as follows: Interest Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset. Other income Other revenue is recognised when it is received or when the right to receive payment is established. (r) Critical accounting estimates and judgements The directors evaluate estimates and judgments incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Group. Asset Acquisition vs Business Combination AASB 3 Business Combination defines a business being ‘an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing a return in the form of dividends, lower costs or other economic benefits directly to investors or other owners, members of participants.’ A business usually consists of Inputs, Processes and Outputs. Inputs and Processes are the essential elements that have to be present in order to be classified as a business. Although a business usually has outputs, outputs are not required for an integrated set of assets to qualify as a business. For the acquisition of a 40% share in Ion Minerals Pty Ltd, as noted above, the Directors have determined that this transaction does not meet the requirements of AASB 3 Business Combination and, thus, has been treated as an Asset Acquisition. As at 30 June 2020, Great Northern Minerals Limited was in negotiations of finalising an option agreement on the North Queensland Gold Projects acquisition, which was to result in the 100% acquisition by Great Northern Minerals Limited. The Directors have determined that this transaction does not meet the requirements of AASB 3 Business Combination, and thus, has treated the acquisition as an Asset Acquisition. Refer to note 25 for details. Exploration and evaluation costs Exploration and evaluation costs have been capitalised and 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. 37 40 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 (r) Critical accounting estimates and judgements (continued) Key judgements are applied in considering the costs to be capitalised which includes determining expenditures directly related to these activities and allocating overheads between those that are expensed and capitalised. Coronavirus (COVID-19) pandemic Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has had, or may have, on the consolidated entity based on known information. This consideration extends to the nature of the products and services offered, customers, supply chain, staffing and geographic regions in which the consolidated entity operates. Other than as addressed in specific notes, there does not currently appear to be either any significant impact upon the financial statements or any significant uncertainties with respect to events or conditions which may impact the consolidated entity unfavourably as at the reporting date or subsequently as a result of the Coronavirus (COVID- 19) pandemic. (s) Goods and Services Tax (GST) Revenues and expenses are recognised net of GST except where GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item. Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the statement of financial position. Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority. (t) New accounting standards for application in the current period The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (“AASB”) that are mandatory for the current reporting period. Any new or amended Accounting Standards or Interpretations that are yet not mandatory have not been early adopted. The following Accounting Standards and Interpretations are most relevant to the consolidated entity: AASB 16 Leases The consolidated entity has adopted AASB 16 from 1 July 2019. The standard replaces AASB 117 'Leases' and for lessees eliminates the classifications of operating leases and finance leases. Except for short-term leases and leases of low-value assets, right-of-use assets and corresponding lease liabilities are recognised in the statement of financial position. Straight-line operating lease expense recognition is replaced with a depreciation charge for the right-of-use assets (included in operating costs) and an interest expense on the recognised lease liabilities (included in finance costs). In the earlier periods of the lease, the expenses associated with the lease under AASB 16 will be higher when compared to lease expenses under AASB 117. However, EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) results improve as the operating expense is now replaced by interest expense and depreciation in profit or loss. 38 41 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 (t) New accounting standards for application in the current period (continued) For classification within the statement of cash flows, the interest portion is disclosed in operating activities and the principal portion of the lease payments are separately disclosed in financing activities. For lessor accounting, the standard does not substantially change how a lessor accounts for leases. Impact of adoption AASB 16 was adopted using the modified retrospective approach and as such the comparatives have not been restated. Below is a reconciliation of total operating lease commitments as at 30 June 2019, as disclosed in the annual financial statements for the year ended 30 June 2019, and the lease liabilities recognised on 1 July 2019. Operating lease commitments as at 30 June 2019 (AASB 117) Additional operating lease Operating lease commitments discount based on the weighted average incremental borrowing rate of 5.4% (AASB 16) Lease Liabilities as at 1 July 2019 (AASB 16) (u) New accounting standards for application in the future periods 1 July 2019 $ - 143,208 (17,617) 125,591 Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the company for the annual reporting period ended 30 June 2020. The Group’s assessment of the impact of these new or amended Accounting Standards and Interpretations, most relevant to the company, is set out below. Reference/ Title Summary IASB amends the definition of material to IASB has made amendments The IAS 1 Presentation of Financial Statements and IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors and consequential amendments to other IFRSs which: i) use a consistent definition of materiality throughout IFRSs and the Conceptual Framework for Financial Reporting; ii) clarify when information is material; and iii) incorporate some of the guidance in IAS 1 about immaterial information. Application date of standard Application date for Group 1 January 2020 1 July 2020 IASB amends the definition of a business (IFRS 3) Sale or contribution of assets between an investor and its associate or joint venture (AASB 2014- 10) The IASB has issued amendments to the guidance in IFRS 3 Business Combinations that revises the definition of a business. 1 January 2020 1 July 2020 The amendments clarify the accounting treatment for sales or contribution of assets between an investor and its associates or joint ventures. They confirm that the accounting depends on whether the contributed assets constitute a business or an asset. 1 January 2022 1 July 2022 The Group has considered what impact these accounting standards will have on the financial statements, when applied next year, and have concluded that they will have no material impact. 39 42 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 (v) Going Concern For the year ended 30 June 2020 the Group recorded a consolidated loss of $3,336,423 (2019: $3,052,814) and at that date the net operating cash out flows were $2,196,004 (2019: $2,567,770). The Group had net current assets of $2,069,057 (2019: $254,889). The expenditure reflected the Group’s acquisition of and funding of its exploration programme at the Company’s Gold Projects at Golden Cup, Camel Creek and Big Rush Gold Mines in North Queensland. These conditions indicate a material uncertainty that may cast significant doubt about the Group’s ability to continue as a going concern, however notwithstanding this the accounts have been prepared on a going concern basis. The Directors have assessed the Group’s operating and research costs along with future commitments for tenement exploration costs in order to establish the future funding requirements for the Group. As at 30 June 2020 the Group had cash on hand of $2,510,058. Subsequent to the financial year end, the Group has announced via the market released dated 31 August 2020, that it had secured Placement commitments totalling $1.5 million (before costs) to enable it to accelerate the drilling programme at the Company’s Queensland Gold Projects. The capital raising successfully completed during the first week of September 2020. In addition to the above and subject to a shareholder approval to be obtained at Company’s Annual General Meeting, to be convened in due course, the Directors have advised their support by collectively subscribing for $100,000 worth of new shares under the Placement. Should the Group be unable to continue as a going concern it may be required to realise its assets and extinguish its liabilities other than in the normal course of business and at the amounts stated in the financial report. The financial report does not include any adjustments relating to the recoverability and classification of recorded asset amounts or to the amounts and classification of liabilities that might be necessary should the Group not continue as a going concern. 3 Auditors' Remuneration Remuneration of the auditor of the parent entity for: - Audit or review - William Buck Audit (WA) Pty Ltd Total remuneration for audit services 4 Other Income - Income from sale/release of royalty (i) - R&D Refund - Other income 2020 $ 2019 $ 28,862 29,740 28,862 29,740 2020 $ 125,000 155,720 33,767 2019 $ 260,000 223,835 309 314,487 484,144 40 43 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 4 Other Income (continued) (i) On 19 March 2019, Great Northern Minerals (previously Greenpower Energy Limited) announced that it entered into a binding Deed of Assignment of Royalty (‘DAR’) with Gasfields Limited, to sell its 1.5% wellhead royalty over 50% of any production from EP447 tenement to Gasfields Limited. Great Northern will receive an initial cash payment of $250,000 and two further instalments of $125,000 each. As a consideration for Great Northern agreeing to the amendment Deed of Agreement, Gasfields will pay Great Northern $10,000 in cash in addition to the initially agreed consideration. As at 30 June 2019, outstanding receivable amount is per Tranche 1 of the Deed of Assignment of Royalty agreement. On 21 February 2020, the Company announced that it has entered into a Deed of Surrender and Release with GCC Methane Pty Ltd of its 1.5% wellhead gas royalty to be derived from gas sales from WA Exploration Permit EP447 for surrender consideration in the amount of $137,500 (inclusive of GST) which has been received during the financial year. 5 Corporate and administration costs - Interest expense - Marketing expenses - Compliance & regulatory fees - Employee benefit expenses - Legal fees - Consultants fees - Share based payment expenses - Other corporate & administration expenses *Includes lease liability interest expense per AASB 16 6 Income Tax Expense / (Benefit) (a) The major components of tax expense (benefit) comprise: Income tax expense 2020 $ 32,291* 39,231 303,986 299,809 55,637 191,000 111,180 163,256 2019 $ 2,610 67,525 226,225 437,200 42,107 310,659 - 544,833 1,196,391 1,631,159 2020 $ - - 2019 $ - - (b) The prima facie tax benefit/(expense) from the loss before income tax is reconciled to the income tax as follows: Net Profit/(Loss) before tax Prima facie tax benefit on loss from ordinary activities before income tax at 30% (2019: 27.5%) - the Group (3,336,423) (3,052,814) (1,000,927) (839,524) (1,000,927) (839,524) 41 44 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 6 Income Tax Expense / (Benefit) (continued) (b) The prima facie tax benefit/(expense) from the loss before income tax is reconciled to the 2020 $ 2019 $ income tax as follows (continued): Add/Less tax effect of: -non-deductible expenses -losses not brought to account -non-assessable income -movement in unrecognisable temporary differences -deductible equity raising costs Income tax attributable to parent entity (c) Unrecognised temporary differences Deductible temporary differences Tax revenue losses Tax capital losses 368,728 714,978 (56,357) (16,428) (9,994) - 839,524 - - - - - 88,580 3,347,052 3,209,831 96,257 2,412,735 2,942,345 Deferred tax assets are only recognised for deductible temporary differences and unused tax losses if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. Availability of losses is subject to passing the required tests under the ITAA 1997/1936. 7 Loss per Share (a) Reconciliation of Loss used to calculate Loss per share Loss Loss used to calculate basic and diluted EPS (b) Weighted average number of ordinary shares (diluted): Weighted average number of ordinary shares outstanding during the year number used in calculating: Basic EPS Diluted EPS 2020 $ 2,722,903 2019 $ 2,451,005 2,722,903 2,451,005 2020 number 2019 number 359,994,638 155,896,443* 359,994,638 155,896,443 *Post-consolidation basis. On 28 October 2019, the Company consolidated its issued capital on a 10:1 basis. Both the basic and diluted loss per share have been calculated using the loss attributable to shareholders of the Parent as the numerator (ie no adjustments to loss were necessary in 2020 or 2019). As the Company is in a loss position, the options outstanding at 30 June 2020 have no dilutive effects on the earnings per share calculation. 42 45 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 8 Cash and Cash Equivalents Cash at bank Short-term bank deposits Reconciliation of Cash Note 8(a) Cash at the end of the financial year as shown in the Statement of Cash Flows is reconciled to items in the Statement of Financial Position as follows: Cash and cash equivalents 2020 $ 2019 $ 2,442,428 60,390 161,887 67,630 2,510,058 222,277 2020 $ 2019 $ 2,510,058 222,277 2,510,058 222,277 As at 30 June 2020 there is a restriction on available cash of $67,630 (20019: $161,887). The Group has a number of short term deposits held as a security for various Victorian exploration licenses on released tenements and active North Queensland exploration licences. The Group is currently working with the Department of Mines and anticipates that the term deposit securities over Victorian exploration licenses over the released tenements should be released in due course. (a) Short term deposit Short term deposits are held as a security for various bank guarantees. 9 Trade and Other Receivables CURRENT Gasfields Royalty receivable R&D Refund receivable Other receivables Note 9(a) 9(b) 9(c) 2020 $ 2019 $ - 155,720 103,720 151,000 223,835 111,577 259,440 486,412 (a) Gasfields Royalty Receivable On 19 March 2019, Great Northern Minerals (previously Greenpower Energy Limited) announced that it entered into a binding Deed of Assignment of Royalty (‘DAR’) with Gasfields Limited, to sell its 1.5% wellhead royalty over 50% of any production from EP447 tenement to Gasfields Limited. Great Northern will receive an initial cash payment of $250,000 and two further instalments of $125,000 each. As a consideration for Great Northern agreeing to the amendment Deed of Agreement, Gasfields will pay Great Northern $10,000 in cash in addition to the initially agreed consideration. As at 30 June 2019, outstanding receivable amount is per Tranche 1 of the Deed of Assignment of Royalty agreement. 46 43 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 9 Trade and Other Receivables (a) Gasfields Royalty Receivable (continued) On 21 February 2020, the Company announced that it has entered into a Deed of Surrender and Release with GCC Methane Pty Ltd of its 1.5% wellhead gas royalty to be derived from gas sales from WA Exploration Permit EP447 for surrender consideration in the amount of $137,500 (inclusive of GST) which has been received during the financial year. (b) R&D Refund Receivable R & D Refund due from the Australian Taxation Office for 2019 financial year over Company’s OHD Project (2018: $223,835). (c) Other Receivables Other receivables represent receivables due from the Australian Taxation Office for BAS Quarterly Returns in the total amount of $52,790, office bond in the amount of $23,687, tenement bond in the amount of $1,500, credit card security bond of $20,000 and other immaterial receivable amounts totalling $5,743 which are not impaired and will be receivable. 10 Plant and Equipment Office equipment & furniture At cost Accumulated depreciation Total office equipment & furniture Total plant and equipment 2020 $ 2019 $ 128,947 (26,996) 138,100 (14,170) 101,951 123,930 101,951 123,930 (a) Movements in Carrying Amounts Movement in the carrying amounts for each class of plant and equipment between the beginning and the end of the current financial year: Office Equipment 2019 $ 2020 $ 123,930 4,407 (800) (25,586) 101,951 757 134,854 - (11,681) 123,930 Balance at the beginning of year Additions Disposals Depreciation expense Balance at the end of the year 47 44 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 11 Right-of-use asset The Company entered into a rental lease for their office premises in September 2018. The term of the lease is five years, with the option to extend for another three years. The value of the right-of-use asset was calculated based on the particulars of the lease. Variables which were taken into account include the lease term, rent per annum, clauses for rent increases, rent abatements, and the option to extend (the option to extend was not taken into account, as the Company has not made a firm decision on this matter). The right- of-use asset will be depreciated over the lease term, the depreciation expense and lease liability will be expensed. In subsequent reporting periods, the right-of-use asset will be revalued to reflect the remaining life of the lease. Set out below are the carrying amounts of right-of-use assets recognised and the movements during the period: Right-of-Use Assets Balance at the beginning of period Right-of-use asset additions Accumulated depreciation Balance at the reporting date Lease Liabilities Balance at beginning of period Lease liabilities additions Accretion of interest Payments Balance at the reporting date Lease liabilities – current Lease liabilities – non current Depreciation expense for right-of-use assets Interest expense on lease liabilities Total amount recognised in profit or loss 48 45 2020 $ - 125,591 (27,216) 98,375 2020 $ - 125,591 6,129 (29,083) 102,637 27,397 75,240 27,216 6,129 33,345 2019 $ - - - - 2019 $ - - - - - - - - - Annual Report 2020 | Financial ReportGreat Northern Minerals 49 Annual Report 2020 | Financial ReportGreat Northern MineralsGreat Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 46 12 Controlled Entities The consolidated financial statements incorporate the assets, liabilities and the results of the following subsidiary in accordance with the accounting policy described in note 1: Controlled Entities Principal Activity Country of Incorporation Percentage Owned 2020 Percentage Owned 2019 Greenpower Group Pty Ltd Investment Australia 100% 100% Greenpower Gold Pty Ltd (previously GCC Asset Holdings Pty Ltd) Investment Australia 100% 100% Northern Exploration Pty Ltd Exploration Australia 100% 100% Sawells Pty Ltd Exploration Australia 100% 100% Greengrowth Energy Pty Ltd (previously Greengrowth Bio-Stimulants Pty Ltd) Non-trading Australia 95% 95% Greenpower Chemicals Pty Ltd Non-trading Australia 100% 100% Greenpower Guyana Pty Ltd Investment Australia 100% 100% Ion Minerals Pty Ltd Exploration Australia 40% 40% 12(a) Summarised financial information on subsidiaries with material non-controlling interest Set out below is the summarised financial information for Ion Minerals Pty Ltd which has a non-controlling interest material to Great Northern Minerals Limited (previously Greenpower Energy Limited). Summarised Statement of Financial Position Current 2020 $ 2019 $ Assets 7,729 66,757 Liabilities (948,958) (944,910) Total Current Net Assets (941,229) (878,153) Non-Current Assets - 959,458 Liabilities - - Total Non-Current Net Assets - 959,458 Revenue - 324 Loss before income tax (1,022,534) (1,003,701) Income tax - - Total comprehensive loss for the year (1,022,534) (1,003,701) Total comprehensive loss attributable to NCI (613,520) (601,809) Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 13 Exploration and Evaluation Assets Exploration expenditure capitalised Exploration and evaluation permits A reconciliation of the carrying amount of exploration and evaluation expenditure is set out below: Carrying amount at the beginning of the year Acquisition costs incurred during the year Impairment of exploration and evaluation expenditure* Deferred consideration capitalised** Carrying amount at the end of the year 2020 $ 2019 $ 562,076 948,133 948,133 412,076 (948,133) 150,000 562,076 - 1,073,133 (125,000) - 948,133 * On 23 October 2018, Great Northern Minerals Limited (formerly Greenpower Energy Limited) completed Phase 1 of Ion Minerals Pty Ltd acquisition. The initial acquisition was 40%, with the option to earn in a further 30% through a Phase 2 Earn-in and the remaining 30% in Phase 3 Earn-In. On 30 October 2019, the Company made an announcement to the Australian Stock Exchange (ASX), that it will discontinue involvement in the project to focus on other core assets. As a result an impairment loss of $948,133 in relation to this asset has been recognised in the year ended 30 June 2020. ** On 15 August 2019, Great Northern Minerals announced that it had exercised the option to the Heads of Agreement with Q-Generate Pty Ltd to acquire the former gold producing mines of Camel Creek, Golden Cup and Big Rush (“The Golden Ant Project”) in North Queensland. Management have accounted for this transaction as an acquisition of assets and not as a business combination since, at the date of acquisition, the Golden Ant Project did not have the processes and outputs expected of an operating business. The Consideration for the acquisition comprised of:  Upfront Consideration consisting to be paid at settlement, of $20,000 for the grant of Exclusive Option fee, $50,000 cash payment and $50,000 worth of fully paid ordinary shares in GNM (formerly GPP) to be issued to the owner (or its nominee, on behalf of the vendors), the issue price was calculated on the basis of a 30 day VWAP prior to the date of the Options Exercise Notice being issued (with a minimum floor price of $0.03 per share);  Deferred Consideration to be paid post settlement and subject to achievement of Milestones as follows: -$50,000 in cash and $100,000 in GNM shares to be issued upon estimation of JORC compliant Measured Mineral Resource of at least 100,000 ounces of gold at the Project. The amount of $150,000 has been capitalised as deferred consideration as at 30 June 2020; and -$1,500,000 in cash or GNM shares (subject to shareholder approval) upon estimation of JORC compliant Measured Mineral Resource of at least 100,000 ounces of gold at the Project and either 12 months after the grant of Environmental Access in respect of the licences or 24 months after the settlement. The amount of $1,500,000 has been recognised as a contingent liability as at 30 June 2020 (refer to Note 21). 50 47 Annual Report 2020 | Financial ReportGreat Northern Minerals 51 Annual Report 2020 | Financial ReportGreat Northern MineralsGreat Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 48 13 Exploration and Evaluation Assets (continued) Subsequent to the financial year end, on 10 August 2020, Great Northern Minerals Limited announced that it had entered into a deed of variation to the Heads of Agreement with Q-Generate Pty Ltd to accelerate the completion of 100% ownership of the North Queensland gold projects. The parties to the agreement have mutually agreed to reduce the agreed deferred and further deferred consideration via an early cash payment of $859,450, representing a discount of approximately 50% to the existing deferred and further deferred consideration per Heads of Agreement, totalling $1.732M, which resulted in completion of Great Northern Minerals’ 100% ownership of the Queensland gold projects. Great Northern Minerals Limited made the early cash payment of $859,450 during August 2020. Exploration permits Refer to Interests in Exploration Tenements section at the end of this consolidated financial report for the list of exploration licences held by the Group. 14 Trade and Other Payables 2020 $ 2019 $ CURRENT Trade payables 489,353 381,140 Other payables 53,999 89,677 543,352 470,817 15 Issued Capital Movements in ordinary share capital No. of shares $ Year ended 30 June 2020 At the beginning of year 1,943,207,165 75,182,850 Shares issued during the year 949,234,267 5,195,826 Part Consideration Shares issued for North Queensland Projects (i) 1,666,666 50,000 Cost of issuing shares - (594,051) Consolidation of issued capital on 10:1 basis (2,072,020,981) - Balance at 30 June 2020 822,087,117 79,834,625 (i) Refer to note 13 for details. Year ended 30 June 2019 At the beginning of year 1,455,370,361 74,126,524 Shares issued during the year 377,836,804 660,102 Shares issued for acquisition of Ion Minerals 110,000,000 550,000 Cost of issuing shares - (153,776) Balance at 30 June 2019 1,943,207,165 75,182,850 The Company has no authorised share capital or par value in respect of its issued shares. Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 15 Issued Capital (continued) Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of shares held. At the shareholders meetings, each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands. Capital Risk Management The Group's and the Parent’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may pay dividends to shareholders, return capital to shareholders, issue new shares or sell assets. During 2020 financial year, the Group's strategy, which was unchanged from 2019, was to maintain minimum borrowings outside of trade and other payables. During the 2020 financial year a loan was received on commercial terms from a Director. This loan was repaid during 2020 financial year. Cash and cash equivalents Less: payables Net cash Total equity Total capital 16 Reserves Share Based Payments Reserve Financial Assets Reserve Total Reserves Share Based Payments Reserve Opening balance Options expired Options issued during the year Financial Assets Reserve Opening balance Equity instruments reclassified as financial assets at FVTPL Total Reserves 52 49 2020 $ 2,510,058 (543,352) 2019 $ 222,277 (470,817) 1,966,706 3,971,587 (248,539) 1,931,774 2,004,881 2,180,313 2020 $ 295,056 - 2019 $ 349,212 - 295,056 349,212 2020 $ 2019 $ 349,212 (165,336) 111,180 716,857 (367,645) - 295,056 349,212 - - - 14,666 (14,666) - 295,056 349,212 Annual Report 2020 | Financial ReportGreat Northern Minerals 53 Annual Report 2020 | Financial ReportGreat Northern MineralsGreat Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 50 16 Reserves (continued) Share Based Payments Reserve The share-based payments reserve records items recognised as expenses on valuation of employee share options. Share options are issued for nil consideration. The exercise price of the share options is determined by the Directors in their absolute discretion and set out in the Offer provided that the exercise price is not less than the average Market Price on ASX on the five trading days prior to the day the Directors resolve to grant the Options. Any options that are not exercised by their expiry date will lapse. Upon exercise, these options will be settled in ordinary fully paid shares of the Company. The Options can be exercised in whole or part at any time up to and including the Expiry Date by lodging and Option Exercise Notice accompanied by the payment of the exercise price. 2020 $ 2019 $ Options at 1 July 349,212 716,857 Options issued during the year 111,180 - Expiry of options during the year (165,336) (367,645) Options at 30 June 295,056 349,212 Summary of options granted as share based payments The following table illustrates the number and movements in share options under share based payments: 2020 Number 2019 Number Outstanding at the beginning of the year 8,000,000 31,000,000 Granted during the year 21,000,000 - Vested during the year - - Exercised during the year - - Lapsed/cancelled during the year - (23,000,000)1 Forfeited during the year - - Consolidation of issued capital on 10:1 basis (7,200,000) - Outstanding at the year end 21,800,000 8,000,000 Exercisable at the year end 21,800,0000 8,000,000 1. Options expired on 1 January 2019. Weighted average remaining contractual life of share options The weighted average remaining contractual life for the share options outstanding as at 30 June 2020 is 1.33 years (2019: 1.2 years). Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 16 Reserves (continued) Range of exercise price of share options The exercise price for options outstanding at the end of the year is $0.01 to $0.30 (2019: $0.03). Weighted average fair value of share options The weighted average fair value of options granted during the year is $111,180 (2019: $nil). Share option valuation The fair value of the equity-settled share options granted under the share based payments is estimated at the date of grant using a Black Scholes model, which takes into account factors including the options exercise price, the volatility of the underlying share price, the risk-free interest rate, the market price of the underlying shares at grant date, historical and expected dividends and the expected life of the option. The options were valued using Black Scholes with the below assumptions: Number of options in series Underlying share price ($) Exercise price ($) Expected volatility (%) Option life Expiry date Dividend yield (%) Risk free interest rate (%) Number of options in series Underlying share price Exercise price Expected volatility Option life Expiry date Dividend yield Interest rate Listed Options 21,000,000 0.005 0.01 100 2 years 1 November 2022 Nil 0.54 Unlisted Options 8,000,000 $0.021 $0.03 99.20% 3 years 27 October 2020 0.00% 1.64% 54 51 Annual Report 2020 | Financial ReportGreat Northern Minerals 55 Annual Report 2020 | Financial ReportGreat Northern MineralsGreat Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 52 17 Accumulated Losses 2020 $ 2019 $ Accumulated losses Opening balance (73,600,527) (71,531,883) Net loss for the period attributable to Owners of Parent (2,722,903) (2,451,005) Reclassification adjustments: - Options lapsed transferred from reserves 165,336 367,645 - Available for sale assets reserve transferred - 14,666 Total (76,158,094) (73,600,527) 18 Cash Flow Information (a) Reconciliation of Cash Flow from Operations with Loss after Income Tax 2020 $ 2019 $ Net loss for the year (3,336,423) (3,052,814) Cash flows excluded from loss attributable to operating activities Non-cash flows in loss Amortisation 27,216 2,773 Depreciation 29,618 11,681 Impairment loss on financial assets - 16,667 Share based payments (111,180) - Fair value adjustment - 16,666 Impairment of exploration assets 948,133 125,000 Impairment of receivables 129,000 - Write down in net assets of associate - 416,002 Impairment on investment accounted for using equity method - 21,036 Changes in assets and liabilities, net of the effects of purchase and disposal of subsidiaries Decrease/(Increase) in receivables 223,681 (152,266) (Decrease)/Increase in trade payables and accruals (106,049) 27,487 Net cash (outflow) from operating activities (2,196,004) (2,567,768) (b) Non-Cash Financing and Investing Activities During the year the Group had the following non-cash financing and investing activities: - Part consideration payment for the acquisition The Golden Ant Project in North Queensland. The part purchase consideration was settled by issuance of 1,666,666 shares at deemed issue price $0.03 for consideration of $50,000. The deemed issue price was calculated on the basis of a 30 day VWAP prior to the date of the Option Exercise Notice being issued. – refer to note 13. Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 19 Project Expenditure Commitments Planned project expenditure commitments contracted for: Exploration Permits Payable: - not later than 12 months* - between 12 months and 5 years - more than 5 years 2020 $ 1,458,687 1,458,687 317,158 964,889 176,640 1,458,687 2019 $ 855,297 855,297 115,831 739,466 - 855,297 *During 2020 financial year, the Group spent $708,859 on granted tenement licences and $20,038 on application licences. The amounts detailed above is the minimum expenditure required to maintain ownership of the current tenements held. An obligation may be cancelled if a tenement is surrendered. 20 Related Party Transactions (a) Parent entity The ultimate parent entity within the Group is Great Northern Minerals Limited. (b) Subsidiaries Interests in subsidiaries are set out in note 12. (c) Compensation The aggregate compensation made to directors and other members of key management personnel of the consolidated entity is set out below: Short-term employee benefits Post-employment benefits Share-based payments 2020 $ 362,420 27,621 45,780 2019 $ 420,574 14,250 - 435,821 434,824 (d) Transactions and balances with related parties All transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated. 2020 - During the financial year, Mineral Intelligence Pty Ltd, a Company which Managing Director Cameron McLean has an interest in, was loaned by Great Northern Minerals Limited an amount of $2,873. The terms of the transaction were on a no interest basis. The balance payable by Mineral Intelligence to Great Northern Minerals Limited as at 30 June 2020 was $5,467. Subsequent to the year end, the funds are yet to be repaid from Mineral Intelligence Pty Ltd. 56 53 Annual Report 2020 | Financial ReportGreat Northern Minerals 57 Annual Report 2020 | Financial ReportGreat Northern MineralsGreat Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 54 20 Related Party Transactions (d) Transactions and balances with related parties (continued) -During 2019 financial year, Mineral Intelligence Pty Ltd, a Company which Managing Director, Cameron McLean has an interest in, loaned $11,000 to Ion Minerals Pty Ltd. The terms of the transaction were on a no interest basis. The balance outstanding and payable to Mineral Intelligence Pty Ltd by Ion Minerals Pty Ltd as at 30 June 2020 is $11,000. The funds are yet to be repaid to Mineral Intelligence Pty Ltd. 2019 - During the financial year, Ion Minerals Pty Ltd repaid the outstanding loan balance it had owing to Director, Alistair Williams, which was the balance brought over from previous period and was still owing upon Great Northern Minerals Limited’s (previously Greenpower Energy Limited) acquisition of Ion Minerals Pty Ltd. On 13 November 2019, the Company fully settled the balance outstanding of $13,395. The terms of the transaction were on a no interest basis. Balance owing to Alistair Williams as at 30 June 2019 was Nil. - During the financial year, Mineral Intelligence Pty Ltd, a Company which Managing Director, Cameron McLean has an interest in, loaned $11,000 to Ion Minerals Pty Ltd. The terms of the transaction were on a no interest basis. The balance outstanding and payable to Mineral Intelligence Pty Ltd by Ion Minerals Pty Ltd as at 30 June 2019 is $11,000. Subsequent to the year end, the funds are yet to be repaid to Mineral Intelligence Pty Ltd. - During the financial year, Mineral Intelligence Pty Ltd, a Company which Managing Director Cameron McLean has an interest in, was loaned by Great Northern Minerals Limited (previously Greenpower Energy Limited) an amount of $2,594. The terms of the transaction were on a no interest basis. The balance payable by Mineral Intelligence as at 30 June 2019 was $2,594. Subsequent to the year end, the funds are yet to be repaid from Mineral Intelligence Pty Ltd. There were no other Key Management personnel related party transactions during the year. 21 Contingent liabilities and contingent assets Contingent Liabilities The Group had contingent liabilities at 30 June 2020 in respect of: - The Group has provided bank guarantees in favour of the Minister of Energy and Resources with respect to a security deposit and in favour of Minister of Energy and Resources Victoria with respect to a contract performance at 30 June 2020. The total of these guarantees at 30 June 2020 was $32,533 with a financial institution (30 June 2019: $20,000). - On 15 August 2019, Great Northern Minerals announced that it had exercised the Option Agreement with Q-Generate Pty Ltd to acquire the former gold producing mines of Camel Creek, Golden Cup and Big Rush (“The Golden Ant Project”) in Northern Queensland. Upon estimation of JORC compliant Measured Mineral Resource of at least 100,000 ounces of gold at the Golden Ant Project and;  either 12 months after the grant of Environmental Access in respect of the licences; or  24 months after the settlement Great Northern Minerals Limited will need to pay $1,500,000 in cash or GNM shares to Q-Generate Pty Ltd or it’s nominee. Contingent Assets The Group had no contingent assets at 30 June 2020. Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 22 Financial Risk Management (a) Financial Risks The main risks the Group is exposed to through its financial instruments are interest rate risk and liquidity risk. Exposure to interest rate, liquidity and credit risk arises in the normal course of the Group’s business. The Group does not hold or issue derivative financial instruments. The Group uses different methods as discussed below to manage risks that arise from these financial instruments. The objective is to support the delivery of the financial targets while protecting future financial security. Primary responsibility for the identification and management of financial risks rests with the Board. (a) Liquidity risk The Company manages liquidity risk by maintaining sufficient cash facilities to meet the operating requirements of the business. The responsibility for liquidity risk management rests with the Board of Directors. The Company manages liquidity risk by monitoring forecast cash flows and ensuring that adequate working capital is maintained. The Company’s policy is to ensure that it has sufficient cash reserves to carry out its planned exploration activities over the next 12 months. (b) Interest rate risk Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair value of financial instruments. The Company’s exposure to market risk for changes to interest rate risk relates primarily to its earnings on cash. (b) Credit Risk The Group has no significant concentrations of credit risk other than cash at bank which is held with the Commonwealth Bank of Australia and Westpac Bank both AA- rated Australian banks. The maximum exposure to credit risk at reporting date is the carrying amount (net of provision of expected credit losses) of those assets as disclosed in the statement of financial position and notes to the financial statements. As the Group does not presently have any debtors, lending, significant stock levels or any other credit risk, a formal credit risk management policy is not maintained. Credit risk represents the risk that the counterparty to the financial instrument will fail to discharge an obligation and cause the Group to incur a financial loss. During 2019 financial year, the Group had a credit risk exposure within the sale of royalty, which as at 30 June 2019 owed to the Group $151,000. On 21 February 2020, the Company announced that it has entered into a Deed of Surrender and Release with GCC Methane Pty Ltd of its 1.5% wellhead gas royalty to be derived from gas sales from WA Exploration Permit EP447 for surrender consideration in the amount of $137,500 (inclusive of GST) which has been received during the financial year. (c) Liquidity Risk Liquidity risk is the risk that the Group may encounter difficulties raising funds to meet commitments associated with financial instruments (e.g. borrowing repayments). The Group manages liquidity risk by monitoring forecast cash flows and ensuring that adequate unutilised borrowing facilities are maintained. 58 55 Annual Report 2020 | Financial ReportGreat Northern Minerals 59 Annual Report 2020 | Financial ReportGreat Northern MineralsGreat Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 56 23 Events after the Reporting Period There are no matters or circumstances which have arisen since the end of the year which will significantly affect, or may significantly affect, the state of affairs or operations of the reporting entity in future financial years other than the following:  On 10 August 2020, the Company announced that it had signed a deed of variation to the Heads of Agreement to accelerate the completion of 100% ownership of the North Queensland gold projects. The Parties to the Heads of Agreement have mutually agreed to reduce the agreed deferred and further deferred consideration via an early cash payment of $859,450, representing a discount of approximately 50% to the existing deferred and further deferred consideration totalling $1.732M which completes Great Northern’s 100% ownership of the Golden Ant Project.  On 4 September 2020, the Company completed a placement via issuance of 80,521,786 fully paid ordinary shares, raising $1.52 million. The funds raised will be utilised to accelerate drilling at Company’s Queensland gold projects and for general working capital.  The Company also received commitments and support from Company Directors who collectively subscribed for $100,000 worth of New Shares, which are subject to shareholder approval at Company’s upcoming 2020 Annual General Meeting to be convened in due course.  The impact of the Coronavirus ('COVID-19') pandemic is ongoing for the consolidated entity up to 30 June 2020, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided. 24 Segment Reporting AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance. The Group predominantly operates in one segment, being exploration activities throughout Australia. The Group via a heads of agreement was funding exploration in Guyana undertaken by Great Northern Minerals (previously Greenpower Energy Limited) exploration partner and operator Guyana Strategic Metals Inc., a Canadian registered entity. The Company has fully impaired all the costs incurred and funded for operations in Guyana over the last financial years, as its focus is on its Australian Projects. Information regarding the non-current assets by geographical location is reported for Australian exploration assets only, being $1,261,526. Refer to note 13. 25 Asset Acquisition – Golden Ant Project On 15 August 2019, Great Northern Minerals Limited announced that it had exercised the option to the Heads of Agreement with Q-Generate Pty Ltd to acquire the former gold producing mines of Camel Creek, Golden Cup and Big Rush (“The Golden Ant Project”) in North Queensland. Management have accounted for this transaction as an acquisition of assets and not as a business combination since, at the date of acquisition, the Golden Ant Project did not have the processes and outputs expected of an operating business. The Consideration for the acquisition comprised of:  Upfront Consideration consisting to be paid at settlement, of $20,000 for the grant of Exclusive Option fee, $50,000 cash payment and $50,000 worth of fully paid ordinary shares in GNM (formerly GPP) to be issued to the owner (or its nominee, on behalf of the vendors), the issue price was calculated on the basis of a 30 day VWAP prior to the date of the Options Exercise Notice being issued (with a minimum floor price of $0.03 per share); Great Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 25 Asset Acquisition – Golden Ant Project (continued)  Deferred Consideration to be paid post settlement and subject to achievement of Milestones as follows: - - $50,000 in cash and $100,000 in GNM shares to be issued upon estimation of JORC compliant Measured Mineral Resource of at least 100,000 ounces of gold at the Project; and $1,500,000 in cash or GNM shares (subject to shareholder approval) upon estimation of JORC compliant Measured Mineral Resource of at least 100,000 ounces of gold at the Project and either 12 months after the grant of Environmental Access in respect of the licences or 24 months after the settlement. Subsequent to the financial year end, on 10 August 2020, Great Northern Minerals Limited announced that it had entered into a deed of variation to the Heads of Agreement with Q-Generate Pty Ltd to accelerate the completion of 100% ownership of the North Queensland gold projects. The parties to the agreement have mutually agreed to reduce the agreed deferred and further deferred consideration via an early cash payment of $859,450, representing a discount of approximately 50% to the existing deferred and further deferred consideration per Heads of Agreement, totalling $1.732M, which resulted in completion of Great Northern Minerals’ 100% ownership of the Queensland gold projects. Great Northern Minerals Limited made the early cash payment of $859,450 during August 2020. 26 Parent Entity The following information has been extracted from the books and records of the parent, Great Northern Minerals Limited and has been prepared in accordance with Accounting Standards. The financial information for the parent entity, Great Northern Minerals Limited has been prepared on the same basis as the consolidated financial statements. Investments in subsidiaries Investments in subsidiaries, are accounted for at cost in the financial statements of the parent entity. 2020 $ 2019 $ 2,915,765 1,458,390 550,988 115,379 4,374,155 666,367 1,392,760 75,240 293,706 - 1,468,000 293,706 2,906,155 372,661 Consolidated Statement of Financial Position Assets Current assets Non-current assets Total Assets Liabilities Current liabilities Non-current liabilities Total Liabilities Net Assets 60 57 Annual Report 2020 | Financial ReportGreat Northern Minerals 61 Annual Report 2020 | Financial ReportGreat Northern MineralsGreat Northern Minerals Limited ABN 22 000 002 111 Notes to the Consolidated Financial Statements For the Year Ended 30 June 2020 58 26 Parent Entity (continued) 2020 $ 2019 $ Equity Issued capital 79,834,619 75,182,850 Accumulated losses (77,223,520) (75,159,401) Share Based Payments Reserve 295,056 349,212 Total Equity 2,906,155 372,661 Consolidated Income Statement Total loss for the year (2,064,119) (3,493,011) Total comprehensive loss (2,064,119) (3,493,011) Guarantees entered into by the parent entity in relation to the debts of its subsidiaries Pursuant to ASIC Instrument 2017/785 Great Northern Minerals Limited and its wholly owned subsidiaries (refer note 12) entered into a deed of cross guarantee. The effect to the deed is that Great Northern Minerals Limited has guaranteed to pay any deficiency in the event of winding up of any controlled entity or if they do not meet their obligations under the terms of any debt subject to the guarantee. The controlled entities have given a similar guarantee in the event that Great Northern Minerals Limited is wound up or if it does not meet its obligations under the terms of any debt subject to the guarantee. Contingent liabilities of the parent entity The Directors are not aware of any contingent liabilities at reporting date, except for already disclosed contingent liabilities at note 21 of this financial report. Great Northern Minerals Limited ABN 22 000 002 111 Directors' Declaration In accordance with a resolution of the directors of Great Northern Minerals Limited, the directors of the company declare that: 1. the financial statements, notes and the remuneration report in the Directors’ Report are in accordance with the Corporations Act 2001, including: a. b. giving a true and fair view of the financial position of the Consolidated Group as at 30 June 2020 and of its performance for the year ended on that date; and complying with Australian Accounting Standards (including International Financial Reporting Standards) and the Corporations Regulations 2001; 2. in the directors' opinion, there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable. This declaration has been made after receiving the declarations required to be made to the directors in accordance with sections of 295A of the Corporations Act 2001. This declaration is made in accordance with a resolution of the Board of Directors. .................................................................. Kim Robinson Chairman Dated: 29 September 2020 59 62 Annual Report 2020 | Financial ReportGreat Northern Minerals63 Annual Report 2020 | Financial ReportGreat Northern Minerals Great Northern Minerals Limited Independent auditor’s report to members Report on the Audit of the Financial Report Opinion We have audited the financial report of Great Northern Minerals Limited (the Company and its subsidiaries (the Group)), which comprises the consolidated statement of financial position as at 30 June 2020, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information, and the directors’ declaration. In our opinion, the accompanying financial report of the 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 2020 and of its financial performance for the year ended on that date; and (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Material Uncertainty Related to Going Concern We draw attention to Note 2(v) in the financial report, which indicates that the Group incurred a net loss of $3,336,423 and incurred net operating cash outflows of $2,196,004 during the year ended 30 June 2020. As stated in Note 2(v), these events or conditions indicate that a material uncertainty exists that may cast significant doubt on Independent auditor’s report to members (cont’d.) the Group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter. 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 as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Related to Going Concern section, we have determined the matters described below to be the key audit matters to be communicated in our report. ACQUISITION OF THE GOLDEN ANT PROJECT LICENCES Area of focus Refer also to note 2(r) & 25 How our audit addressed it Our audit procedures included: — A review of the term sheet for the acquisition of Golden Ant Project to evaluate the nature of the acquisition. — An evaluation of the Directors assessment that Golden Ant Project does not meet the definition of a Business under AASB 3 Business Combinations and the resulting conclusion to treat the acquisition as an Asset Acquisition. — An assessment of the adequacy of the Group’s disclosures in respect of the acquisition. We concluded that the treatment of the Golden Ant Project acquisition as an Asset Acquisition was appropriate and in accordance with the relevant Australian Accounting Standards. The Group acquired 100% of the licenses that make up the Golden Ant Project (Camel Creek Mine, Golden Cup Gold Mine and Big Rush Gold Mine) in North Queensland. The Directors determined that this transaction did not meet the requirements of AASB 3 Business Combinations and, thus, it has been treated it as an Asset Acquisition. The Directors performed their assessment in line with AASB 3 Business Combinations which defines a business as being ‘an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing a return in the form of dividends, lower costs or other economic benefits directly to investors or other owners, members or participants.’ A business usually consists of inputs, processes, and outputs. Inputs and processes are the essential elements that must be present in order to be classified as a business. Although a business usually has outputs, outputs are not required for an integrated set of assets to qualify as a business. This was a key matter because of the significance of the value of acquisition costs capitalised at 30 June 2020. 64 Annual Report 2020 | Financial ReportGreat Northern Minerals 65 Annual Report 2020 | Financial ReportGreat Northern Minerals Independent auditor’s report to members (cont’d.) CARRYING VALUE OF EXPLORATION COSTS CAPITALISED Area of focus Refer also to note 2(i) & 13 How our audit addressed it The Group has incurred exploration costs in relation to the Group's exploration programs. There is a risk that the capitalisation of exploration and evaluation expenditure may exceed the value in use. Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. One or more of the following facts and circumstances indicate that an entity should test exploration and evaluation assets for impairment: — the period for which the entity has the right to explore in the specific area has expired during the period or will expire in the near future and is not expected to be renewed. — substantive expenditure on further exploration for and evaluation of mineral resources in the specific area is neither budgeted nor planned. — exploration for and evaluation of mineral resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and the entity has decided to discontinue such activities in the specific area. — sufficient data exist to indicate that, although a development in the specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full, from a successful development or by sale. This was a key matter because of the significance of the capitalised Exploration and evaluation assets at 30 June 2020. Our audit procedures included: — A review of the directors’ assessment of the criteria for the capitalisation of exploration expenditure costs and evaluation as to whether there are any indicators of impairment of capitalised costs. — An assessment of viability of the tenements and whether there were any indicators of impairment of those costs capitalised in the current period. — An assessment of the adequacy of the Group’s disclosures in respect of the transactions. We concluded that recognition treatment and impairment assessment were in accordance with the relevant Australian Accounting Standards. Independent auditor’s report to members (cont’d.) Other Information The directors are responsible for the other information. The other information comprises the information in the Group’s annual report for the year ended 30 June 2020 but does not include the financial report and the auditor’s report thereon. Our opinion on the financial report does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Directors for the Financial Report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. 66 Annual Report 2020 | Financial ReportGreat Northern Minerals 67 Annual Report 2020 | Financial ReportGreat Northern Minerals Independent auditor’s report to members (cont’d.) A further description of our responsibilities for the audit of these financial statements is located at the Auditing and Assurance Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf This description forms part of our independent auditor’s report. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included on pages 18 to 23 of the directors’ report for the year ended 30 June 2020. In our opinion, the Remuneration Report of Great Northern Minerals Limited, for the year ended 30 June 2020, complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. William Buck Audit (WA) Pty Ltd ABN 67 125 012 124 Robin Judd Director Dated this 29th day of September 2020 Annual Report 2020 | Additional Information Great Northern Minerals Limited Additional Information for Public Listed Companies For the Year Ended 30 June 2020 ASX Additional Information Additional information required by the ASX Limited Listing Rules and not disclosed elsewhere in this report is set out below. This information is effective as at 28 August 2020. Voting Rights Ordinary Shares On a show of hands, every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. Options No voting rights. Distribution of Equity Security Holders Holding Range 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,000 and over Total Holders 49 253 324 1,004 484 Number of Shares 10,082 986,267 2,647,576 39,889,784 778,600,951 2,114 822,134,660 Unmarketable Parcel of Ordinary Shares Minimum $500 parcel at $0.0210 per unit 23,810 994 9,768,693 Minimum Parcel Size Holders Units 65 68 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Annual Report 2020 | Additional Information 69 Annual Report 2020 | Directors’ ReportGreat Northern MineralsGreat Northern Minerals Limited Additional Information for Public Listed Companies For the Year Ended 30 June 2020 66 Top 20 Largest Shareholders Rank Name Units % Units 1 JETOSEA PTY LTD 151,665,574 18.45 2 PAPILLON HOLDINGS PTY LTD 31,785,716 3.87 3 XCEL CAPITAL PTY LTD 28,809,484 3.50 4 MR ERNST KOHLER 28,517,003 3.47 5 METECH SUPER PTY LTD 23,000,000 2.80 6 MR ALISTAIR WILLIAMS 21,897,024 2.66 7 BASS FAMILY FOUNDATION PTY LTD 19,500,000 2.37 8 PANDORA NOMINEES PTY LTD 13,565,384 1.65 9 KALCON INVESTMENTS PTY LTD 13,472,024 1.64 10 BUSHWOOD NOMINEES PTY LTD 12,380,901 1.51 11 EXERTUS CAPITAL PTY LTD 11,166,667 1.36 12 RADROB PTY LTD 10,590,710 1.29 13 MR STEPHEN TOMSIC 10,198,205 1.24 14 DAVANNA PTY LTD 10,000,000 1.22 14 HUNG CAPITAL GROUP PTY LTD 10,000,000 1.22 14 LOMACOTT PTY LTD 10,000,000 1.22 14 MRS ANGELA MAREE ROWE 10,000,000 1.22 18 CITICORP NOMINEES PTY LIMITED 9,822,155 1.19 19 MAD FISH MANAGEMENT PTY LTD 8,500,000 1.03 20 BORA BORA RESOURCES LIMITED 8,000,000 0.97 20 THE MEHMET AND MARCKATOS FUND PTY LTD 8,000,000 0.97 Top holders of FULLY PAID ORDINARY SHARES (Total) 450,870,847 54.84 Securities exchange listing The Company is listed on the Australian Securities Exchange under GNM ASX code. The Company has listed options on the Australian Securities Exchange under GNMOA, GNMOB and GMOF. Address The address of the registered office and principal place of business in Australia is Level 1, 33 Colin Street, West Perth WA 6005. Telephone (08) 6214 0148. Register of securities Registers of securities are held at the following address: Computershare Investor Services Pty Ltd Level 11, 172 St Georges Terrace Perth WA 6000 Annual Report 2020 | Additional Information Great Northern Minerals Limited Additional Information for Public Listed Companies For the Year Ended 30 June 2020 20 Largest Option holders for ‘GNMOA’ Listed Options exercisable at $0.18 on 15 December 2021 Rank Name 1 2 3 4 5 6 7 8 9 10 10 10 13 14 15 16 17 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 MR NICHOLAS DERMOTT MCDONALD MS FURONG ZHANG + MR VICTOR ZHOU MR RALPH MANNO + MRS CHRISTINE ANNE D'AHREMBERG EXPANZ AGENCIES LIMITED MS CHUNYAN NIU KALCON INVESTMENTS PTY LTD GOLDEN DAWN LIMITED MRS CHRISTINA MARIE HIRRELL ROTHERWOOD ENTERPRISES CHELMSLEY PROPRIETARY LIMITED QUID CAPITAL PTY LTD MR DAVID JAMES WALL BUSHWOOD NOMINEES PTY LTD BARROSEVEN PTY LIMITED T T NICHOLLS PTY LTD MIRADOR CORPORATE PTY LTD RED MOUNTAIN MINING LTD ABN AMRO CLEARING SYDNEY NOMINEES PTY LTD MR DAMIAN FRANCIS BRIZZI & MR JAMES LEE CHERUBIN & MR VINCENZO BRIZZI MRS MARY BRODERICK & DR JOHN BRODERICK MR MARK LANGLEY BURCHNALL MR MATTHEW BURFORD BURNAL PTY LTD MR STACEY HUBERT CARTER CRIVE PTY LTD DANLAMB PTY LTD MR JEFFREY ALLAN DUNN FIRESTONE INVESTMENTS PTY LTD FIRST INVESTMENT PARTNERS MR GREGORY WALLACE FOX & MRS CHERYL ANN FOX G & P REDFEARN INVESTMENTS P/L MR ROGER CLIVE GILBEY & GLM KOPPA PTY LTD GRAZING PROPER PTY LTD MR DEREK HA MR ALEXANDER JOHN HARRISON HOWSER PTY LTD HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2 Units 8,907,713 616,666 600,000 500,000 376,899 300,000 256,410 247,435 200,000 166,666 166,666 166,666 154,000 150,000 130,000 100,000 96,000 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 76,923 67 70 % Units 47.95 3.32 3.23 2.69 2.03 1.61 1.38 1.33 1.08 0.90 0.90 0.90 0.83 0.81 0.70 0.54 0.52 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Annual Report 2020 | Additional Information 71 Annual Report 2020 | Directors’ ReportGreat Northern MineralsGreat Northern Minerals Limited Additional Information for Public Listed Companies For the Year Ended 30 June 2020 68 Rank Name Units % Units 18 MR WERNER KUFFER & MRS GLENYS ANNE KUFFER 76,923 0.41 18 M & K KORKIDAS PTY LTD 76,923 0.41 18 MR ROBERT MCDOWELL 76,923 0.41 18 MR NON HUYNH NGUYEN 76,923 0.41 18 MR TAMUKA NUNGIRAYI & MISS SARAH NUNGIRAYI 76,923 0.41 18 P & N KALAMVOKIS INVESTMENTS PTY LTD 76,923 0.41 18 PANDORA NOMINEES PTY LTD 76,923 0.41 18 MS JOAN EVELYNE PEREIRA 76,923 0.41 18 MR SIMON ANDREW PETERS + MS EMMA FRANCES VOGEL 76,923 0.41 18 MR ANTHONY ROBERT REECE & 76,923 0.41 18 MRS KATIE ELIZABETH REECE 76,923 0.41 18 STOJ INVEST PTY LTD 76,923 0.41 18 T T NICHOLLS PTY LTD 76,923 0.41 18 MR IAN THOMPSON & MR PETER RANDAL THOMPSON 76,923 0.41 18 MR MARK ANDREW TKOCZ 76,923 0.41 18 TOWNACE HOLDINGS PTY LTD 76,923 0.41 18 TREGEARE PTY LTD 76,923 0.41 18 MS ROSILYN MAY WATSON 76,923 0.41 18 WESTWIZE ENTERPRISES PTY LTD 76,923 0.41 18 MR YING KIT WONG & 76,923 0.41 18 MR THEAM HUAH YEOH 76,923 0.41 18 MS YAFEN ZHU 76,923 0.41 Top holders of ‘GNMOA’ LIST OPT EXP 15/12/21 @$0.18 (Total) 16,442,810 88.50 Annual Report 2020 | Additional Information Great Northern Minerals Limited Additional Information for Public Listed Companies For the Year Ended 30 June 2020 20 Largest Option holders for ‘GNMOB’ Listed Options exercisable at $0.022 on 1 July 2023 Rank Name 1 2 3 4 5 6 7 8 8 10 11 12 13 14 15 16 17 18 19 20 JETOSEA PTY LTD KALCON INVESTMENTS PTY LTD MS CHUNYAN NIU ILLUMINATION HOLDINGS PTY LTD XCEL CAPITAL PTY LTD MR NICHOLAS DERMOTT MCDONALD JETOSEA PTY LTD GECKO RESOURCES PTY LTD WHEAD PTY LTD MR JOSEPH ALLEN TREACY + MRS KAYE LYNETTE TREACY MR BILAL AHMAD BUSHWOOD NOMINEES PTY LTD ALITIME NOMINEES PTY LTD GOFFACAN PTY LTD RIMOYNE PTY LTD J P MORGAN NOMINEES AUSTRALIA PTY LIMITED MAVERICK EXPLORATION PTY LTD MR CHRISTOPHER JAMES COWAN MR STEVEN DAVID BURNETT MISS HUONG THI VANG Units 28,749,996 12,750,000 12,420,406 10,000,000 8,749,980 3,000,000 2,383,333 2,000,000 2,000,000 1,500,000 1,450,000 1,250,000 1,230,000 1,200,000 1,000,000 964,370 960,022 900,000 600,000 580,000 % Units 28.04 12.44 12.11 9.75 8.53 2.93 2.32 1.95 1.95 1.46 1.41 1.22 1.20 1.17 0.98 0.94 0.94 0.88 0.59 0.57 Top 20 holders of ‘GNMOB’ LISTED OPTIONS EXPIRING 01/07/2023 @ $0.022 (Total) 93,688,107 91.38 69 72 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Annual Report 2020 | Additional Information 73 Annual Report 2020 | Directors’ ReportGreat Northern MineralsGreat Northern Minerals Limited Additional Information for Public Listed Companies For the Year Ended 30 June 2020 70 20 Largest Option holders for ‘GNMOF’ Listed Options exercisable at $0.01 on 1 November 2022 Rank Name Units % Units 1 JETOSEA PTY LTD 61,530,119 25.80 2 HUNG CAPITAL GROUP PTY LTD 16,516,667 6.92 3 MS CHUNYAN NIU 14,449,450 6.06 4 KALCON INVESTMENTS PTY LTD 13,000,000 5.45 5 PAPILLON HOLDINGS PTY LTD 8,200,312 3.44 6 NIGHTFALL PTY LTD 8,000,000 3.35 7 XCEL CAPITAL PTY LTD 7,833,333 3.28 8 MR ALISTAIR WILLIAMS 6,833,333 2.86 9 MR NICHOLAS DERMOTT MCDONALD 6,600,000 2.77 10 CALE CONSULTING PTY LTD 6,000,000 2.52 10 COXSROCKS PTY LTD 6,000,000 2.52 10 KIM ROBINSON 6,000,000 2.52 13 EXERTUS CAPITAL PTY LTD 5,583,334 2.34 14 BORA BORA RESOURCES LIMITED 4,000,000 1.68 14 ILLUMINATION HOLDINGS PTY LTD 4,000,000 1.68 14 MR SAMUEL SPEER 4,000,000 1.68 17 NAEN PTY LIMITED 3,500,000 1.47 18 KALCON INVESTMENTS PTY LTD 3,333,334 1.40 19 MR SIMON ANDREW PETERS 3,000,000 1.26 19 MR COLIN WEEKES 3,000,000 1.26 Top 20 holders of ‘GNMOF’ LISTED OPTIONS EXPIRING 01/11/2022 @ $0.01 (Total) 191,379,882 80.23 Option Equity Securities as at 28 August 2020 Total options on issue 822,134,660 Total listed options on issue 359,629,208 Total unlisted options on issue 1,600,000 Great Northern Minerals Annual Report 2020 | Additional Information Great Northern Minerals Limited Interest in Mining Tenements For the Year Ended 30 June 2020 Interest in Exploration Tenements Region Project Tenement Interest Held Queensland Queensland Queensland Queensland Queensland Queensland Queensland Queensland Queensland Queensland Queensland Queensland Queensland Golden Ant – Camel Creek EPM27207 Golden Ant – Big Rush EPM27283 Golden Ant – Big Rush Golden Ant – Big Rush Golden Ant – Big Rush Golden Ant – Golden Cup Golden Ant – Camel Creek Golden Ant – Camel Creek Golden Ant – Camel Creek Golden Ant – Camel Creek Golden Ant – Camel Creek Golden Ant – Camel Creek Golden Ant – Camel Creek ML10168 ML10175 ML10192 ML4536 ML4522 ML4523 ML4524 ML4525 ML4534 ML4540 ML6952 Western Australia Ashburton Guyana Queensland Queensland Queensland Turesi PGGS Big Rush Black Mountain Camel Creek** E52/3612 Guyana – Turesi EPM27500 EPM27522 EPM26637 **Joint venture with NorthX Pty Ltd (refer to ASX announcement dated 1 April 2020). 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% *Application only *Application only *Application Only 74 71 Annual Report 2020 | Directors’ ReportGreat Northern Minerals Great Northern Minerals Level 1, 33 Colin Street WEST PERTH WA 6005 AUSTRALIA www.greatnorthernminerals.com.au 

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