ANNUAL REPORT
2011
GREAT WESTERN MINING Annual Report 2011
Great Western Mining Corporation Plc
Annual Report and Financial Statements
for the year ended 31 December 2011
Registered number: 392620
Contents
Page
Directors and other information ..............................................................2
Chairman's Statement and Review of Activities ....................................3 - 4
Chief Executive's Statement..................................................................5 - 6
Directors' Report .................................................................................7 - 12
Independent Auditors' Report ............................................................13 - 15
Statement of Accounting Policies........................................................15 - 21
Consolidated Statement of Comprehensive Income................................22
Consolidated Statement of Changes in Equity ........................................23
Company Statement of Changes in Equity .............................................24
Consolidated Statement of Financial Position .........................................25
Company Statement of Financial Position...............................................26
Consolidated Statement of Cash Flows ..................................................27
Company Statement of Cash Flows........................................................28
Notes to the Financial Statements.......................................................29 - 40
page 1
GREAT WESTERN MINING Annual Report 2011
Directors and other information
Solicitors
John O'Connor Solicitors,
168 Pembroke Road,
Ballsbridge,
Dublin 4.
Geological Consultant W.T. Cohan & Associates
AIM Nominated
Adviser & Broker
Registrar
Incorporated,
Grand Junction,
Colorado, U.S.A.
Shore Capital
Bond Street House
14 Clifford Street
London W1S 4JU
England.
Computershare Investor Services
(Ireland) Limited
Heron House,
Corrig Road,
Sandyford,
Dublin 18.
Registered Number
392620, Republic of Ireland.
Date of Incorporation 20 October 2004.
Website
www.greatwesternmining.com
Directors
Emmett O'Connell
(Executive Chairman)
Melvyn Quiller (U.K.)
(Chief Executive Officer)
Robert O'Connell
(Operations Director)
Nial Ring FCCA
(Non - Executive Director)
Christopher Hall (UK)
(Non-Executive Director)
Appointed 15 June 2011
Liam McGrattan
(Non - Executive Director)
Resigned 27 May 2011
Registered Office
& Business Address
6 Northbrook Road,
Dublin 6.
Secretary
Emmett O'Connell
Auditors
Bankers
LHM Casey McGrath,
Chartered Certified Accountants
& Registered Auditors,
6 Northbrook Road,
Dublin 6.
HSBC Bank
60 Queen Victoria Street
London EC4N 4TR
England
Bank of Ireland
Taghmon
Co. Wexford
Country Bank,
200 42nd Street,
New York,
U.S.A.
page 2
GREAT WESTERN MINING Annual Report 2011
Chairman's Statement & Review of Activities
2011 was a year of Corporate and Exploration development. Your Company’s area under claim rose from 435
individual 20-acre claims to 896 claims, all 100% working interest. This makes Great Western Mining Corporation,
our wholly owned and Nevada incorporated subsidiary, one of the largest prospective land holders in the Marietta
area, with about 73 sq km. In the third quarter of 2011, following a Placing to raise £1,000,000, the Company’s
application for admission to the AIM Market of the London Stock Exchange was approved and trading in the
Company’s shares began on 18th August. Given the Company’s historical links with Ireland and the high percentage
of Irish shareholders, on 18th October, the Company’s shares were admitted to trading on the Enterprise Securities
Market (ESM) of the Irish Stock Exchange.
Determined to maintain our exploration programme despite a tight budget, horizontal trench sampling and
geological testing were undertaken in early 2012 on the area known as the “Double Prospect” or “A4” in place
of shallow core hole drilling. This represented the most efficient use of funds in terms of geological information
retrieved. The analysis of samples taken was very encouraging and may be viewed on the Company’s website.
Some market comment has been made regards the values of copper in the horizontal trenching campaign relative
to reported “grab samples” recorded in earlier surface samples. This is discussed more fully in the Chief Executive
Officer's report. Suffice to say here that the two sampling methods are not directly comparable given the different
methodology employed.
Emboldened by the results on Phase One, the Company’s team of Directors and specialist contractors turned to the
adjoining Prospect (“M2”) to determine if the geological mineralisation was similar. This phase is still underway as
we go to press, but early indications are encouraging. Geological sampling and mapping give indications of near
surface copper oxide mineralisation running 1,200 metres in length and 120 metres wide running down the spine
of the prospect. In addition to possible shallow oxide copper deposits, it is intended to test for deeper sulphide
copper values, which have been highlighted by the Induced Polarisation survey, in due course.
No further work has been carried out on our already reported uranium discovery covered extensively in previous
years. It is being held as an asset by the Company. The Company also holds a number of attractive precious metal
prospects in its registered claim holdings. Your Directors have however, concentrated the Company's financial
resources on its copper and copper/silver prospects as the most likely to yield early production, joint venture, or cash
flow potential.
The Road Ahead
A Competent Person’s Report is being currently drafted which will update the work carried out up to June 2012.
Last year's (June 2011) CPR gave the following:
Potential Target Models
Model
Disseminated Silver
Mass Tons
25 Million
Grade
102.9 g/t Ag
Disseminated Oxide Copper
25 million
0.6 % Cu
Epithermal Silver Vein
3 Million
514.3 g/t Ag
page 3
GREAT WESTERN MINING Annual Report 2011
The potential quantity and grade is conceptual in nature. There has been insufficient exploration to define a Mineral
Resource, but your management and consultants are working on this. Of the seven specific targets itemised by our
early JPL-NASA Satellite Imagery, Aero & Surface Magnetic Studies, and Induced Polarity Program, only two have
been ground tested and explored in the past year. Your Board of Directors believe that a joint venture business plan
may be the most effective development strategy for a non-revenue generating exploration company. By adopting
such a plan, the Company accepts a certain dilution in an exploration property rather than dilution to our existing
shareholders in all our prospects. GWM holds 100% working interest in all seven existing prospects, any one of
which may hold an attraction to another mining company willing to pay for development expenses to discovery or
abandonment in return for part interest. A mineral discovery on any prospect in our portfolio even at a 50%
participation level, will translate meaningfully into shareholder value through tighter shareholder structure in
remaining prospects.
Although early days yet, studies are underway examining the efficacy of installing a heap leach copper recovery
system in the area of the Company’s interest. This would be a medium term development in terms of funding and
timing. It is important therefore, to keep in mind that 100% of Great Western Mining Corporation’s efforts and
mining assets are located in the mining friendly and politically secure environment of Nevada, U.S.A., just 10 miles
or so from the California border with access to modern highway systems and rail connections to Pacific Ocean
Ports. It is worth remembering that one customer, China, takes 40% of world copper production outside China.
Think Big.
Emmett O'Connell
Chairman
Chief Geo (77yrs old) checking claimstake maps
page 4
GREAT WESTERN MINING Annual Report 2011
Chief Executive's Statement
Great Western has made solid and encouraging progress during 2011, providing definitive evidence of the extent
of mineralisation occurring over the staked claims of the Company. Results from geological field work have
continually reinforced expectations that the Great Western claims could harbour significant amounts of commercially
recoverable copper.
2011 saw the Company prepare to move from PLUS Markets to AIM; this involved the small management team in
much preparatory work right up to the start of AIM trading in August. Even so, 2011 saw your Company extend
its claims under licence from 412 up to 896, covering approximately 73 square kilometres, and conduct extensive
geological surveying.
Besides further prospecting and sampling, the methods used included; ASTER imaging interpretation and low level
aero magnetic data interpretation together with infrared spectral imaging. Following these interpretations Zonge
Geosciences were retained to run two IP-Resistivity Grids covering selected targets from the previously identified total
of seven. The independent report, compiled by Chris Luwig, Consulting Geophysicist, reiterated that buried IP
anomalies were identified below each target and are of such a character as to warrant further priority geological
study and a drilling programme on targets M2 and 4, before moving on to the other five targets. Target M2 closely
correlates with a buried source magnetic high and a copper skarn environment is certainly a plausible explanation.
Target 4 has a buried IP anomaly suggestive of sulphide mineralisation which could host precious metals although
a copper porphyry system cannot be ruled out. (The full report can be found on the Great Western Mining website).
These interpretations and reports have greatly encouraged the Great Western team and based upon the
recommendations the 2012 field campaign was devised. The Company had previously considered a very limited
drilling campaign on one target but upon reconsideration decided to conduct some trenching, geological mapping
and soil surveys as the means to gather further relevant data in the most economical manner. This will move us
significantly forward from the visually selected grab sampling conducted in widespread locations over the 896
claims. This grab sampling was to identify possible mineralisation and generally returned high grades.
The soil, trench and outcrop sampling require the geologists to plan a grid over the target area and take the specific
material that they find at the precise grid locations irrespective of their visual evaluation. These processes are
specifically designed to assist in identification of the geological structures in the effort to determine the extent and
precise locations of the mineralisation. This naturally leads to a wide variation in results compared with the grab
sampling.
Post year end has seen the completion of the target 4 preliminary geological mapping by independent geologist,
Donald Strachan. His report confirms the findings of Bill Cohan and in some respects can be considered more
encouraging. He has recommended extending the Company’s area under licence by staking a further 67 claims to
cover a previously unidentified extension of the anomaly westwards underground. He is now in the process of
completing his preliminary geological survey of M2, soil survey and the outcrop mapping of Target 4. The Company
also commissioned further ground geophysics on target 4 to be performed by Zonge Geosciences. On completion
of the report, which will identify the optimum drilling locations and angles, a planning application will be prepared
and submitted. The drilling campaign is likely to comprise 1500 metres of core drilling on Target 4 subject to
availability of funding.
page 5
GREAT WESTERN MINING Annual Report 2011
The prospects for Great Western Mining as a result of previous and continued successful exploration are extremely
promising. Evidence of copper, silver and gold mineralisation is very strong and this has certainly proved encouraging
as we move forward in 2012 and the Company continues to shore up resources and stake new claims. A post year
end report has been produced by Donald Strachan, which reaffirms the findings as displayed in the Competent
Person’s Report of June 2011. With studies now underway to evaluate the concept of creating a heap leach copper
operation in the immediate vicinity of the Company’s claims, 2012 will see Great Western progress to new levels
on its exploration and mining journey.
As at the start of June 2012, the Company had cash deposits of approximately £280,000. In the coming six months
we hope to have published the preliminary study on M2; soil sampling results and outcrop mapping on A4 with
application planning for pilot drilling. Moreover, provided that new funds are raised, drilling will commence on A4.
Sincerely,
Melvyn Quiller
Chief Executive
Date: 26 June 2012
Miners cabin with wind generator (old washing machine and 50gal drum)
to vent the adits and shafts.
page 6
GREAT WESTERN MINING Annual Report 2011
Directors' Report
for the year ended 31 December 2011
The Directors present their Annual Report and audited consolidated financial statements for the year ended 31
December 2011 for Great Western Mining Corporation Plc ("the Company") and its subsidiary (collectively "the
Group").
Principal Activity
The Group's main activity is the exploration and mining for copper, silver, gold and other minerals in Nevada, U.S.A.
The Directors have reviewed the financial position of the Group and are satisfied that the Group will continue to
operate at its projected level of activity for the foreseeable future.
Review of Business and Future Developments
A detailed review of activities for the year and future prospects of the Group is contained in the Chairman's and
Chief Executive's Statements.
Principal Risks and Uncertainties
The Group's activities are carried out principally in North America and in the Republic of Ireland. Accordingly the
principal risks and uncertainties are considered to be the following:
Exploration Risk
Exploration and development activities may be delayed or adversely affected by factors outside the Group's control,
in particular: climatic conditions, existence of commercial deposits of copper, silver, gold and other minerals,
unknown geological conditions; remoteness of location; actions of host governments or other regulatory authorities
(relating to, inter alia, the grant, maintenance or renewal of any required authorisations, environmental regulations
or changes in law).
Commodity Price Risk
The demand for, and price of, copper, silver, gold and other minerals is dependent on global and local supply and
demand, actions of governments or cartels and general global economic and political developments.
Political Risk
As a consequence of activities in different parts of the world, the Group may be subject to political, economic and
other uncertainties, including but not limited to terrorism, military repression, war or unrest, changes in national
laws and energy policies.
Share Price
The share price movement in the year ranged from a low of Stg £0.0775 to a high of Stg £0.135 (2010: Stg £0.1175
to Stg £0.185). The share price at the year end was Stg £0.0812 (2010: Stg £0.1175).
Results And Dividends
The loss for the year after providing for depreciation and taxation amounted to €793,151 (2010 : € 327,258 ).
All exploration and development costs to date have been deferred, no transfers to distributable reserves or dividends
are recommended.
page 7
GREAT WESTERN MINING Annual Report 2011
Directors and Secretary and their Interests
In accordance with the Articles of Association, Emmett O'Connell and Nial Ring retire from the Board by rotation
and being eligible offers themselves for re-election.
The Directors and secretary who held office at the year end had no interest, either direct or beneficial, other than
those shown below, in the shares of the Company.
Directors
Emmett O'Connell (Director & Secretary)
Emmett O'Connell (Pension Fund)
Melvyn Quiller
Nial Ring
Robert O'Connell
Robert O'Connell (Pension Fund)
Christopher Hall
26 Jun '12
5,802,818
1,650,000
1,847,813
850,000
5,201,365
250,000
-
31 Dec '11
5,802,818
1,650,000
1,847,813
850,000
5,201,365
250,000
-
31 Dec '10
4,901,000
1,650,000
1,700,995
850,000
4,900,001
250,000
-
Share options in Great Western Mining Corporation Plc - Ordinary Shares
At 31 December 2011 there were no share options granted. It is intended that in 2012 the following share options
will be granted to the directors:
Emmett O'Connell
Melvyn Quiller
Nial Ring
Robert O'Connell
Christopher Hall
No. of
options
Nil
1,500,000
450,000
450,000
450,000
Transactions Involving Directors
There have been no contracts or arrangements of significance during the year in which Directors of the Company
were interested other than as disclosed in Notes 15 and 16 to the financial statements.
Significant Shareholders
The Company has been informed that, in addition to the interests of the Directors, at 31 December 2011 and the
date of this report, the following shareholders own 3% or more of the issued share capital of the Company:
Pershing International Nominees Ltd
Vidacos Nominees Ltd
Fitel Nominees Ltd
Raven Nominees Ltd
Redmayne (Nominees) Ltd
Winterflood Securities Ltd
Ashdale Investment Trust Services
Percentage of Issued share capital
26 Jun '12
8.25%
3.39%
3.03%
3.57%
4.03%
2.81%
7.79%
31 Dec '11
11.84%
3.35%
3.08%
4.86%
4.15%
3.17%
4.44%
The Directors are not aware of any other holding of 3% or more of the share capital of the Company.
page 8
GREAT WESTERN MINING Annual Report 2011
Group undertakings
Details of the Company's subsidiary are set out in Note 9 to the financial statements.
Political donations
The Company did not make any political donations during the year (2010 : €Nil).
Going Concern
The future of the Group is dependent on the successful future outcome of its exploration interests. The Directors
have carried out a review of budgets and cash flows for the twelve months after the date of this report and on the
basis of that review, consider that the Group and the Company, based on current exploration activity, will have
adequate financial resources to continue in operation for the foreseeable future. As exploration activity is expanded,
further funding will be required.
The Directors consider that in preparing the financial statements they have taken into account all information that
could reasonably be expected to be available. On this basis, they consider that it is appropriate to prepare the
financial statements on the going concern basis.
Corporate governance
The Directors are committed to maintaining the highest standards of corporate governance commensurate with the
size, stage of development and financial status of the Group.
Chinese demand
for Chile’s copper
holds strong
PAV JORDAN
The Globe and Mail
Monday, Jun. 25 2012
Narrow gauge line for ore carts 60+ degree decline
page 9
GREAT WESTERN MINING Annual Report 2011
The Board
The Board is responsible for the supervision and control of the Company and is accountable to the shareholders.
The Board has reserved decision-making on a variety of matters, including determining strategy for the Group,
reviewing and monitoring executive management performance and monitoring risks and controls.
The Board currently has five Directors, comprising three executive Directors and two non-executive Directors. The
Board met formally on fourteen occasions during the year ended 31 December 2011. An agenda and supporting
documentation was circulated in advance of each meeting. All the Directors bring independent judgement to bear
on issues affecting the Group and all have full and timely access to information necessary to enable them to
discharge their duties. The Directors have a wide and varying array of experiences in the industry.
Audit and Remuneration Committees
The Audit Committee comprises Nial Ring (Chairman) and Christopher Hall. It may examine any matters relating to
the financial affairs of the Group and the Group's audits. This includes reviews of the annual financial statements
and announcements, internal control procedures, accounting procedures, accounting policies, the appointment,
independence, objectivity, terms of reference and fees of external auditors and such other related functions as the
Board my require.
The Remuneration Committee comprises Christopher Hall (Chairman) and Nial Ring. It determines the terms and
conditions of employment and annual remuneration of the executive directors. It consults with the Chief Executive
Officer, takes into consideration external data and comparative third part remuneration and has access to
professional advice outside the Company.
The key policy objectives of the Remuneration Committee in respect of the Company's executive directors are:
-
-
to ensure that individuals are fairly rewarded for their personal contributions to the Company's overall
performance; and
to act as the independent committee ensuring that due regard is given to the interest of the Company's
shareholders and to financial and commercial health of the Company.
Directors' Remuneration, including employer's PRSI, during the year ended 31 December 2011 was as follows:
Remuneration and other emoluments - Executive Directors
Remuneration and other emoluments - Non-Executive Directors
2011
Total
€
2010
Total
€
192,629
8,620
_________
201,249
_________
123,870
21,075
_________
144,945
_________
Nomination Committee
At present, as the Board of Directors is small, no formal nomination committee has been established. The authority
to nominate new Directors for appointment vests in the Board of Directors. All Directors co-opted to the Board
during any financial period are subject to election by shareholders at the first opportunity following their
appointment. Consideration to setting up a nomination committee is under continuous review.
page 10
GREAT WESTERN MINING Annual Report 2011
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Annual Report and the Group and Company financial statements
in accordance with applicable Irish law and regulations.
Company law requires the Directors to prepare Group and parent Company financial statements for each financial
year. As permitted by company law, the Directors have prepared the Group financial statements in accordance with
International Financial Reporting Standards (IFRSs) as adopted by the EU (EU IFRS) and have elected to prepare the
Company financial statements in accordance with EU IFRS, as applied in accordance with the provisions of the
Companies Acts, 1963 to 2009.
The Group and Company financial statements are required by law and EU IFRS to present fairly the position and
performance of the Group; the Companies Acts provide, in relation to such financial statements, that references in
the relevant part of the Acts to financial statements giving a true and fair view are references to their achieving a
fair presentation.
In preparing each of the Group and Company financial statements, the Directors are required to:
-
select suitable accounting policies and apply them consistently;
- make judgements and estimates that are reasonable and prudent;
- disclose and explain any material departures from applicable accounting standards;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
Company, and the Group as a whole, will continue in business.
Copper demand
outstrips
supply
www.asiaminer.com
page 11
GREAT WESTERN MINING Annual Report 2011
The directors confirm that they have complied with the above requirements in preparing the financial statements.
The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any
time the financial position of the Company and Group and which enable them to ensure that the financial
statements are prepared in accordance with accounting standards generally accepted in Ireland, and comply with
the Companies Acts, 1963 to 2009, the European Communities (Companies: Group Accounts) Regulations 1992
and all regulations to be construed as one with those Acts.
They are responsible for safeguarding the assets of the Group and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included
on the Company's website. Legislation in the Republic of Ireland governing the preparation and dissemination of
financial statements may differ from legislation in other jurisdictions.
Accounting records
The measures taken by the Directors to ensure compliance with the requirements of Section 202, Companies Act
1990, regarding proper books of account are the implementation of necessary policies and procedures for recording
transactions, the employment of competent accounting personnel with appropriate expertise and the provision of
adequate resources to the financial function. The books of account of the Company are maintained at Raheenduff
House, Foulksmills, Co. Wexford.
Auditors
The auditors, LHM Casey McGrath, have indicated their willingness to continue in office in accordance with the
provisions of Section 160(2) of the Companies Act, 1963.
On behalf of the board
_______________
Emmett O'Connell
Date: 26 June 2012
______________
Melvyn Quiller
Gold is a store of value
virtually independent of
economic conditions. ...
gold will always retain
value. Gold is recognized
and valued everywhere
in the world.
Goldprice.org
page 12
GREAT WESTERN MINING Annual Report 2011
Independent Auditors' Report to the Shareholders of Great Western Mining
Corporation Plc
We have audited the Group and Company financial statements (the "financial statements") of Great Western
Mining Corporation Plc for the year ended 31 December 2011 which comprise of the Consolidated Statement of
Comprehensive Income, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity,
Consolidated Statement of Financial Position, Company Statement of Financial Position, Consolidated Statement
of Cash Flows, Company Statement of Cash Flows, and notes thereon. These financial statements have been
prepared under the accounting policies set out on pages 14 - 19.
This report is made solely to the Company's members as a body in accordance with Section 193 of the Companies
Act, 1990. Our audit work has been undertaken so that we might state to the Company's members those matters
that we are required to state to them in the audit report and for no other purpose. To the fullest extent permitted
by law, we do not accept or assume responsibility to anyone other than the Company or the Company's members
as a body for our audit work, for this report, or for the opinions we have formed.
Respective responsibilities of Directors and auditors
The Directors' responsibilities for preparing the Annual Report and the financial statements in accordance with
applicable law and International Financial Reporting Standards as adopted by the European Union ("IFRS") are set
out in the Statement of Directors' Responsibilities on page 10.
Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements
and International Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the Group financial statements give a true and fair view in accordance
with International Financial Reporting Standards as adopted by the European Union and have been properly prepared
in accordance with the Companies Acts 1963 to 2009. We also report to you to whether, in our opinion; proper
books of account have been kept by the Company; whether at the Statement of Financial Position date, there exists
a financial situation requiring the convening of an extraordinary general meeting of the Company; and whether the
information given in the Directors' Report is consistent with the financial statements. In addition, we state whether
we have obtained all the information and explanations necessary for the purposes of our audit and whether the
Company's financial position is in agreement with the books of account.
We report to the shareholders if, in our opinion, any information specified by law or the listing rules of AIM regarding
Directors' remuneration and Directors' transactions is not given and, where practicable, include such information
in our report.
We read the other information contained in the Annual Report and consider whether it is consistent with the
audited financial statements. This other information comprises only the Chief Executive's Statement and the
Chairman's Statement and Review of Activities. We consider the implications for our audit report if we become
aware of any apparent misstatement or material inconsistencies with the financial statements. Our responsibilities
do not extend to any other information.
Basis of opinion
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the
Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and
disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements
made by the Directors in the preparation of the financial statements, and whether the accounting policies are
appropriate to the Group's and Company's circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered
page 13
GREAT WESTERN MINING Annual Report 2011
necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion
we also evaluated the overall adequacy of the presentation of information in the financial statements.
Opinion
In our opinion:
-
of the Group's affairs as at 31 December 2011 and of its loss for the year then ended;
the Group financial statements give a true and fair view, in accordance with IFRSs as adopted by the EU,
of the state
the Company financial statements give a true and fair view, in accordance with IFRSs as adopted by the
applied in accordance with the provisions of the Companies Acts, 1963 to 2009, of the
EU and as
state of the Company's affairs as at 31 December 2011 ; and
the financial statements have been properly prepared in accordance with the Companies Acts, 1963 to
2009.
-
-
We have obtained all the information and explanations we consider necessary for the purposes of our audit. In our
opinion proper books of account have been kept by the Company. The Company Statement of Financial Position
is in agreement with the books of account.
In our opinion the information given in the Directors' Report on pages 7 - 11 is consistent with the financial
statements.
The net assets of the Company, as at the financial position date, are more than half of the amount of its called up
share capital and, in our opinion, on that basis there did not exist at 31 December 2011 a financial situation which
under Section 40(1) of the Companies (Amendment) Act 1983 may require the convening of an extraordinary
general meeting of the Company.
Emphasis of Matter - Deferred Exploration
In forming our opinion, we considered the adequacy of disclosures made in Note 8 to the financial statements in
relation to the Directors' assessment of the carrying value of the Group's deferred exploration costs amounting to
€1,231,607. The realisation of the intangible assets is dependent on the successful development or disposal of
copper, silver, gold and other minerals in the Group's licence area. Such successful development is dependent on
several variables including the existence of commercial deposits of copper, silver, gold and other minerals, availability
of finance and the price of copper, silver, gold and other minerals. Our opinion is not qualified in this respect.
Copper, nickle up
on industrial
demand, global cues
WWW.ECONOMICTIMES.COM
page 14
GREAT WESTERN MINING Annual Report 2011
Emphasis of Matter - Going Concern
In forming our opinion, we have considered the adequacy of the disclosures made in the financial statements as
detailed in Note 1 on page 29 concerning the preparation of the financial statements on the going concern basis
for the period under review. In view of the significance of this matter we feel that this should be brought to your
attention. Our opinion is not qualified in this respect.
____________________
Fergal McGrath
For and on behalf of LHM Casey McGrath
Chartered Certified Accountants & Registered Auditors,
6 Northbrook Road, Dublin 6.
Date: 26 June 2012
Statement of Accounting Policies
for the year ended 31 December 2011
Great Western Mining Corporation Plc ("the Company") is a company incorporated in Ireland. The Group financial
statements consolidate those of the Company and its subsidiary (together referred to as the "Group").
The Group and Company financial statements were authorised for issue by the Directors on 26 June 2012.
The accounting policies set out below have been applied consistently to all periods presented in these consolidated
financial statements.
Basis of Preparation
The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS's)
as adopted by the EU.
The financial statements have been prepared on the historical cost basis. The accounting policies have been applied
consistently by Group entities.
Statement of Compliance
As permitted by the European Union, the Group financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRSs) and their interpretations issued by the International Accounting
Standards Board (IASB) as adopted by the EU (IFRS). The individual financial statements of the Company ("Company
financial statements") have been prepared in accordance with the IFRSs as adopted by the EU and as applied in
accordance with the Companies Acts, 1963 to 2009 which permits a company that publishes its Company and
Group financial statements together, to take advantage of the exemption in Section 148(8) of the Companies Act,
1963, from presenting to its members its Company Statement of Comprehensive Income and related notes that form
part of the approved Company financial statements.
The IFRSs adopted by the EU as applied by the Company and the Group in the preparation of these financial
statements are those that were effective on or before 31 December 2011.
Standards and amendments to existing standards effective 1 January 2011
The following standards, amendments and interpretations which became effective in 2011 are of relevance to the
Group:
page 15
GREAT WESTERN MINING Annual Report 2011
Standard
on/after
IAS 24
IAS 34
Content
Related party disclosures
Interim Financial Reporting
Applicable for years
beginning
1 January 2011
1 January 2011
Standards, amendments and interpretations to existing standards that are not yet effective and have not
been adopted early by the Group
Standard/
Interpretation
on/after
Content
Applicable for years
beginning
IFRS 9
IFRS1*
IFRIC 14 *
IFRIC 19 *
IFRS 7
IFRS 3 *
IAS 27 *
Financial Instruments: Classification and measurement
Amendment: Limited Exemption from Comparative IFRS 7
Disclosures for First-time Adopters
Amendment: The Limit on a Defined Benefit Asset, Minimum
Funding Requirements and their Interaction
Extinguishing financial liabilities with equity instruments
Amendment: Disclosures - Transfer of financial assets
Business Combinations
Consolidated and separate financial statements
1 January 2013
1 July 2010
1 January 2011
1 July 2010
1 July 2011
1 July 2010
1 July 2010
* Not expected to be relevant to the Group, and therefore not to have a material impact on the Group financial
statements.
IFRS 9 'Financial instruments: Classification and measurement'
In November 2009, the IASB issued the first part of IFRS 9 relating to the classification and measurement of financial
IFRS 9 will ultimately replace IAS 29. The standard requires an entity to classify its financial assets on the
assets.
basis of the entity's business model for managing the financial assets and the contractual cash flow characteristics
of the financial assets, an subsequently measures the financial assets as either at amortised cost or fair value. The
new standard is mandatory for annual periods beginning on or after 1 January 2013.
Improvements for IFRS (issued in 2011, March 2012 and May 2012)
The improvements project contains numerous amendments to IFRS that the IASB considers non-urgent but
necessary. 'Improvements to IFRS' comprise amendments that result in accounting changes for presentation,
recognition or measurement purposes, as well as terminology or editorial amendments related to a variety of
individual IFRS standards. Most of the amendments are effective for annual periods beginning on or after 1 January
2013 or 1 January 2014 respectively, with earlier application permitted. No material changes to accounting policies
are expected as a result of these amendments.
In 2011, the Group did not early adopt any new or amended standards and do not plan to early adopt any of the
standards issued but not yet effective.
page 16
GREAT WESTERN MINING Annual Report 2011
Functional and Presentation Currency
The consolidated financial statements are presented in Euro (€), which is the Company's functional currency.
Use of Estimates and Judgements
The preparation of financial statements in conformity with IFRS requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets,
liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and
various other factors that are believed to be reasonable under the circumstances, the results of which form the
basis of making judgements about carrying values of assets and liabilities that are not readily apparent from other
sources.
In particular, significant areas of estimation, uncertainty and critical judgements in applying accounting policies that
have the most significant effect on the amount recognised in the financial statements are in the following areas:
Note 8 - Intangible asset; measurement of impairment
Note 6 - Deferred Tax; utilisation of tax losses
Revenue Recognition - Interest revenue
Interest revenue is accrued on a time basis, by reference to the principal outstanding and at the effective interest
rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of
the financial asset to that asset's net carrying amount.
Basis of Consolidation
The consolidated financial statements comprise the financial statements of Great Western Mining Corporation Plc
and its subsidiary undertaking for the year ended 31 December 2011.
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or indirectly,
to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing
The words for
"silver" and "money"
are the same in at
least 14 languages
Goldprice.org
page 17
GREAT WESTERN MINING Annual Report 2011
control, potential voting rights that are currently exercisable or convertible are taken into account. Subsidiaries are
fully consolidated from the date that control commences until the date that control ceases. Accounting policies of
subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.
Intragroup balances and any unrealised gains or losses or income or expenses arising from intragroup transactions
are eliminated in preparing the Group financial statements.
In the Company's own balance sheet, investments in subsidiaries are stated at cost less provisions for any permanent
diminution in value.
Intangible Assets (Deferred Exploration Costs)
In accordance with International Financial Reporting Standard 6 - Exploration for and Evaluation of Mineral
Resources, the Group uses the cost method of recognition. Exploration costs include licence costs, survey,
geophysical and geological analysis and evaluation costs, costs of drilling and project-related overheads.
Exploration expenditure in respect of properties and licences not in production is capitalised and is carried forward
in the balance sheet under intangible assets in respect of each area of interest where:-
(i) the operations are ongoing in the area of interest and exploration or evaluation activities have not reached a stage
which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves; or
(ii) such costs are expected to be recouped through successful development and exploration of the area of interest
or alternatively by its realisation.
When the Directors decide that no further expenditure on an area of interest is worthwhile, the related expenditure
is written off or down to an amount which it is considered represents the residual value of the Group's interest
therein.
Impairment
The carrying amounts of the Group's non-financial assets, other than deferred tax assets are reviewed at each
reporting date to determine whether there is any indication of impairment. If any such indication exists then the
assets' recoverable amount is estimated. For intangible assets that have indefinite lives or that are not yet available
for use, recoverable amount is estimated at each reporting date.
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its recoverable
amount. A cash-generating unit is the smallest identifiable asset group that is expected to generate cash flows that
largely are independent from other assets and groups. Impairment losses are recognised in the Statement of
Comprehensive Income. Impairment losses recognised in respect of cash-generating units are allocated first to
reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amount of the
other assets in the unit (group of units) on a pro rata basis.
The recoverable amount of an asset or cash generating unit is the greater of its value in use and its fair value less
costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using
a pre-tax discount rate that reflects current market assessments of the time value of money and the risk specific to
the asset.
page 18
GREAT WESTERN MINING Annual Report 2011
Taxation
Income tax expense comprises current and deferred tax. Income tax expense is recognised in profit and loss except
to the extent that it relates to items recognised in other comprehensive income or directly in equity, in which case
the tax is also recognised in other comprehensive income or equity respectively.
Current corporation tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
Deferred tax is recognised using the liability method, providing for temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is not recognised for the following temporary differences: the initial recognition of goodwill, the initial
recognition of assets or liabilities in a transaction that is not a business combination and that affects neither
accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent that they probably
will not reverse in the foreseeable future. Deferred tax is measured at the tax rates that are expected to be applied
to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted
by the reporting date.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against
which temporary difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced
to the extent that it is no longer probable that the related tax benefit will be realised.
Rock samples being prepared for analysis.
page 19
GREAT WESTERN MINING Annual Report 2011
Additional income taxes that arise from the distribution of dividends are recognised at the same time as the liability
to pay the related dividends is recognised.
Foreign Currencies
Monetary assets and liabilities denominated in a foreign currency are translated into Euro at the exchange rate
ruling at the balance sheet date, unless specifically covered by foreign exchange contracts whereupon the contract
rate is used. Revenues, costs and non monetary assets are translated at the exchange rates ruling at the dates of
the transactions. All exchange differences are dealt with through the Statement of Comprehensive Income.
On consolidation, the assets and liabilities of overseas subsidiaries are translated into Euro at the rates of exchange
prevailing at the balance sheet date. Exchange differences arising from the restatement of the opening balance
sheets of these subsidiary Companies are dealt with through reserves. The operating results of overseas subsidiary
Companies are translated into Euro at the average rates applicable during the year.
Share capital
Incremental costs directly attributable to the issue of ordinary shares and share options are recognised as a reduction
in equity.
Earnings per share
The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated
by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number
of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss
attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the
effects of all dilutive potential ordinary shares.
Share based payments
For such grants of share options, the fair value as at the date of grant is calculated, taking into account the terms
and conditions upon which the options were granted. The amount recognised as an expense is adjusted to reflect
the actual number of share options that are likely to vest, except where forfeiture is only due to market-based
conditions not achieving the threshold for vesting
Financial Instruments
Cash and Cash Equivalents
Cash and cash equivalents in the Statement of Financial Position comprise cash at bank and in hand and short term
deposits with an original maturity of three months or less. Bank overdrafts that are repayable on demand and
form part of the Group's cash management are included as a component of cash and cash equivalents for the
purpose of Statement of Cash Flows.
Trade and Other Receivables / Payables
Trade and other receivables and payables are stated at cost less impairment, which approximates fair value given
the short dated nature of these assets and liabilities.
Finance Income
Finance income comprises interest income on funds invested and foreign currency gains.
Interest income is
recognised as the interest accrues (using the effective interest rate method) to the net carrying amount of the
financial asset.
page 20
GREAT WESTERN MINING Annual Report 2011
Segmental Information
In accordance with IFRS 8: Operating Segments, the Group has one principle reportable segment, ie: Nevada, USA,
which represents the exploration for and development of copper, silver, gold and other minerals in Nevada, USA.
Other operations 'Corporate' includes cash resources held by the Group, interest income earned and other
operational expenditure incurred by the Group. These areas are not within the definition of an operating segment.
Financial Assets - Investment in Subsidiaries
Investments in subsidiaries are stated at cost and are reviewed for impairment if there are indications that the
carrying value may not be recoverable.
Provisions
Provisions are recognised when the group has a present obligation (legal or constructive) as a result of a past event
and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation
and a reliable estimate can be made of the amount of this obligation. Where the Group expects some or all of a
provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate
asset but only when the reimbursement in virtually certain. The expense relating to any provision is presented in the
Consolidated Statement of Comprehensive Income net of any reimbursement. If the effect of the time value of
money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risks
specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is
recognised as a finance cost.
A contingent liability is disclosed where the existence of an obligation will only be confirmed by future events or
where the amount of the obligation cannot be measured with reasonable reliability. Contingent assets are not
recognised, but are disclosed where an inflow of economic benefit is probable.
Comparatives
The comparative figures have been regrouped and restated where necessary on the same basis as those for the
current period.
page 21
GREAT WESTERN MINING Annual Report 2011
Consolidated Statement of Comprehensive Income
for the year ended 31 December 2011
Continuing Operations
Administrative expenses
Finance costs
Loss for the year before tax
Income tax expense
Total Comprehensive Loss for the year
Loss attributable to:
Equity holders of the Company
Total Comprehensive Loss attributable to:
Equity holders of the Company
Earnings per share
from continuing operations
Basic and Diluted loss per share (cent)
Notes
4
6
7
2011
€
(787,342)
(5,809)
_________
2010
€
(325,723)
-
_________
(793,151)
(325,723)
-
_________
(793,151)
_________
(793,151)
_________
(793,151)
_________
(793,151)
_________
(793,151)
_________
(1,535)
_________
(327,258)
_________
(327,258)
_________
(327,258)
_________
(327,258)
_________
(327,258)
_________
(1.98)
_________
(1.16)
_________
All activities derived from continuing operations. All losses and total comprehensive losses for the period are
attributable to the owners of the Company.
The Company has no recognised gains or losses other than those dealt with in the statement of comprehensive
income.
The accompanying notes on pages 29 - 39 form an integral part of these financial statements.
The financial statements were approved by the Board of Directors on 26 June 2012 and signed on its behalf by:
______________________
Emmett O'Connell
Director
______________________
Melvyn Quiller
Director
page 22
GREAT WESTERN MINING Annual Report 2011
Consolidated Statement of Changes in Equity
for the year ended 31 December 2011
Balance at 1 January 2010
Total comprehensive income for the year
Loss for the year
Total comprehensive income for the year
Balance at 31 December 2010
Balance at 1 January 2011
Total comprehensive income for the year
Loss for the year
Share options granted in the year
Total comprehensive income for the year
Transactions with owners, recorded directly in equity
Shares issued
Total transactions with owners
Balance at 31 December 2011
Share
Capital
€
Share
Premium
€
Retained
Losses
€
Total
€
282,536
_________
1,602,234 (1,147,104)
_________
_________
737,666
_________
-
_________
-
_________
-
_________
-
_________
(327,258)
_________
(327,258)
_________
(327,258)
_________
(327,258)
_________
282,536
_________
1,602,234 (1,474,362)
_________
_________
410,408
_________
282,536
_________
1,602,234 (1,474,362)
_________
_________
410,408
_________
-
-
_________
-
_________
-
-
_________
-
_________
(793,151)
-
_________
(793,151)
_________
(793,151)
-
_________
(793,151)
_________
182,368
_________
182,368
_________
1,888,023
_________
1,888,023
_________
-
_________
-
_________
2,070,391
_________
2,070,391
_________
464,904
_________
3,490,257 (2,267,513)
_________
_________
1,687,648
_________
Net equity is attributable to the holders of the ordinary shares in the Group.
The accompanying notes on pages 29 - 39 form an integral part of these financial statements.
The financial statements were approved by the board of Directors on 26 June 2012 and signed on its behalf by
______________________
Emmett O'Connell
Director
______________________
Melvyn Quiller
Director
page 23
GREAT WESTERN MINING Annual Report 2011
Company Statement of Changes in Equity
for the year ended 31 December 2011
Balance at 1 January 2010
Total comprehensive income for the year
Loss for the year
Total comprehensive income for the year
Balance at 31 December 2010
Balance at 1 January 2011
Total comprehensive income for the year
Loss for the year
Total comprehensive income for the year
Transactions with owners, recorded directly in equity
Shares issued
Total transactions with owners
Balance at 31 December 2011
Share
Capital
€
Share
Premium
€
Retained
Losses
€
Total
€
282,536
_________
1,602,234 (1,139,860)
_________
_________
744,910
_________
-
_________
-
_________
-
_________
-
_________
(327,262)
_________
(327,262)
_________
(327,262)
_________
(327,262)
_________
282,536
_________
1,602,234 (1,467,122)
_________
_________
417,648
_________
282,536
_________
1,602,234 (1,467,122)
_________
_________
417,648
_________
-
_________
-
_________
-
_________
-
_________
(820,560)
_________
(820,560)
_________
(820,560)
_________
(820,560)
_________
182,368
_________
182,368
_________
1,888,023
_________
1,888,023
_________
-
_________
-
_________
2,070,391
_________
2,070,391
_________
464,904
_________
3,490,257 (2,287,682)
_________
_________
1,667,479
_________
Net equity is attributable to the holders of the ordinary shares in the Company.
The accompanying notes on pages 29 - 39 form an integral part of these financial statements.
The financial statements were approved by the board of directors on 26 June 2012 and signed on its behalf by
______________________
Emmett O'Connell
Director
______________________
Melvyn Quiller
Director
page 24
GREAT WESTERN MINING Annual Report 2011
Consolidated Statement of Financial Position
for the year ended 31 December 2011
Notes
2011
€
2010
€
Assets
Non-Current Assets
Intangible assets
Total Non-Current Assets
Current Assets
Cash and cash equivalents
Total Current Assets
Total Assets
Equity
Capital and Reserves
Share capital
Share premium
Retained loss
Attributable to owners of the Company
Total Equity
Liabilities
Current Liabilities
Trade and other payables
Total Liabilities
Total Equity and Liabilities
8
11
13
13
14
12
1,231,607
_________
1,231,607
656,057
_________
656,057
_________
1,887,664
_________
464,904
3,490,257
(2,267,513)
_________
1,687,648
_________
1,687,648
_________
200,016
_________
200,016
_________
1,887,664
_________
797,657
_________
797,657
6,361
_________
6,361
_________
804,018
_________
282,536
1,602,234
(1,474,362)
_________
410,408
_________
410,408
_________
393,610
_________
393,610
_________
804,018
_________
The accompanying notes on pages 29 - 39 form an integral part of these financial statements.
The financial statements were approved by the Board of Directors on 26 June 2012 and signed on its behalf by
______________________
Emmett O'Connell
Director
______________________
Melvyn Quiller
Director
page 25
GREAT WESTERN MINING Annual Report 2011
Company Statement of Financial Position
for the year ended 31 December 2011
Notes
2011
€
2010
€
Assets
Non-Current Assets
Investment in Subsidiaries
Total Non-Current Assets
Current Assets
Trade and other receivables
Cash and cash equivalents
Total Current Assets
Total Assets
Equity
Capital and Reserves
Share capital
Share premium
Retained loss
Equity Attributable to equity shareholders
Total Equity
Liabilities
Current Liabilities
Trade and other payables
Total Liabilities
Total Equity and Liabilities
9
10
11
13
13
14
12
500,000
_________
500,000
_________
738,684
628,734
_________
1,367,418
_________
1,867,418
_________
464,904
3,490,257
(2,287,682)
_________
1,667,479
_________
1,667,479
_________
500,000
_________
500,000
_________
290,660
3,686
_________
294,346
_________
794,346
_________
282,536
1,602,234
(1,467,122)
_________
417,648
_________
417,648
_________
199,939
_________
199,939
_________
1,867,418
_________
376,698
_________
376,698
_________
794,346
_________
The accompanying notes on pages 29 - 39 form an integral part of these financial statements.
The financial statements were approved by the Board of Directors on 26 June 2012 and signed on its behalf by
______________________
Emmett O'Connell
Director
______________________
Melvyn Quiller
Director
page 26
GREAT WESTERN MINING Annual Report 2011
Consolidated Statement of Cash Flows
for the year ended 31 December 2011
Cash flows from operating activities
Loss for the year
(787,342)
(327,258)
Notes
2011
€
2010
€
Adjustments for:
Income tax expense recognised in profit and loss
Cash from operations before changes in working capital
Movement in trade and other receivables
Movement in trade and other payables
Cash generated from operations
Income tax received
Cash flows from operating activities
Cash flows from investing activities
Expenditure on intangible assets
Interest paid
Cash flow from investing activities
Cash flows from financing activities
Proceeds from the issue of new shares
Net cash used in financing activities
-
_________
(787,342)
-
(193,594)
_________
(980,936)
-
_________
(980,936)
_________
(433,950)
(5,809)
_________
(439,759)
_________
2,070,391
_________
2,070,391
_________
1,535
_________
(325,723)
35
360,407
_________
34,719
4,051
_________
38,770
_________
(91,761)
-
_________
(91,761)
_________
-
_________
-
_________
Movement in cash and cash equivalents
649,696
(52,991)
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
11
11
6,361
_________
656,057
_________
59,352
_________
6,361
_________
The accompanying notes on pages 29 - 39 form an integral part of these financial statements.
The financial statements were approved by the Board of Directors on 26 June 2012 and signed on its behalf by
______________________
Emmett O'Connell
Director
______________________
Melvyn Quiller
Director
page 27
GREAT WESTERN MINING Annual Report 2011
Company Statement of Cash Flows
for the year ended 31 December 2011
Cash flows from operating activities
Notes
2011
€
2010
€
Loss for the year
(848,177)
(342,700)
Adjustments for:
Income tax expense recognised in profit and loss
Cash from operations before changes in working capital
Movement in trade and other receivables
Movement in trade and other payables
Finance costs
Cash generated from operations
-
_________
(848,177)
(448,024)
(176,759)
27,617
_________
(1,445,343)
1,535
_________
(341,165)
(81,164)
369,302
-
_________
(53,027)
Income tax received
-
4,051
Cash flows from operating activities
Cash flows from investing activities
Interest paid
Cash flows from financing activities
Proceeds from the issue of new shares
Net cash used in financing activities
_________
(1,445,343)
_________
(5,809)
_________
5,809
_________
2,070,391
_________
2,070,391
_________
_________
(48,976)
_________
-
_________
-
_________
-
_________
-
_________
Movement in cash and cash equivalents in the year
625,048
(48,976)
Cash and cash equivalents at the beginning of year
Cash and cash equivalents at the end of year
11
11
3,686
_________
628,734
_________
52,662
_________
3,686
_________
The accompanying notes on pages 29 - 39 form an integral part of these financial statements.
The financial statements were approved by the Board of Directors on 26 June 2012 and signed on its behalf by
______________________
Emmett O'Connell
Director
______________________
Melvyn Quiller
Director
page 28
GREAT WESTERN MINING Annual Report 2011
Notes to the Financial Statements
for the year ended 31 December 2011
1. Going concern
The financial statements have been prepared on the going concern basis, which assumes that Great Western
Mining Corporation Plc will continue in operational existence for the foreseeable future.
The validity of this assumption depends on the following:
The Directors intend to raise additional finance during 2012. This additional funding will be used to continue
the exploration programme and to fund the administrative expenses of the Company and the Group.
The financial statements do not include any adjustments that would result if the additional capital is not raised.
Whilst taking into consideration the uncertainties described above, the Directors believe that it is appropriate for
the financial statements to be prepared on a going concern basis.
2. Segment Information
In the opinion of the Directors the operations of the group comprise one class of business, being the exploration
and mining for copper, silver, gold and other minerals. The group's main operations are located within Nevada,
USA. The information reported to the Group's chief operating decision maker for the purposes of resource
allocation and assessment of segment is specifically focussed on the exploration areas in Nevada. In the opinion
of the Directors the Group has only one reportable segment under IFRS 8 'Operating Segments,' which is
exploration carried out in Nevada.
Information regarding the Group's reportable segments is presented below.
Segment Revenues and Results
The following is an analysis of the Group's revenue and results from continuing operations by reportable
segment.
Exploration - Nevada
Total for continuing operations
Investment income
Loss before tax (continuing operations)
Income tax expense
Loss after tax
Segment Revenue
2010
2011
€
€
-
-
_________
_________
-
-
Segment Loss
2011
€
(793,151)
_________
(793,151)
_________
-
_________
(793,151)
_________
-
_________
(793,151)
_________
2010
€
(325,723)
_________
(325,723)
_________
-
_________
(325,723)
_________
(1,535)
_________
(327,258)
_________
page 29
GREAT WESTERN MINING Annual Report 2011
Segment assets and liabilities
Segment Assets
Exploration - Nevada
Consolidated assets
Segment Liabilities
Exploration - Nevada
Consolidated liabilities
Other segment information
Exploration - Nevada
2011
€
1,887,664
_________
1,887,664
_________
2010
€
804,018
_________
804,018
_________
200,016
_________
200,016
_________
393,610
_________
393,610
_________
Depreciation and
amortisation
2010
€
-
_________
2011
€
-
_________
Additions to
non-current assets
2010
2011
€
€
91,761
433,950
_________
_________
Revenue from major products and services
The Group did not receive any revenue in the current or prior year.
Geographical information
The Group operates in two principal geographical areas - Republic of Ireland (country of residence of Great
Western Mining Corporation PLC) and Nevada, U.S.A. (country of residence of Great Western Mining
Corporation, a wholly owned subsidiary of Great Western Mining Corporation PLC).
The Group does not have revenue from external sources. Information about its non-current assets by
geographical location are detailed below:
Ireland
Nevada
2011
€
-
1,231,607
_________
1,231,607
_________
2010
€
-
797,657
_________
797,657
_________
page 30
GREAT WESTERN MINING Annual Report 2011
3. Loss on ordinary activities before taxation
Group
This is arrived at after charging:
Directors' fees
Auditors' remuneration
Auditors' remuneration from non-audit work
and after crediting:
Profit on foreign currencies
Company
This is arrived at after charging:
Auditors' remuneration
2011
€
2010
€
201,249
23,689
56,271
_________
144,945
24,101
30,250
_________
62,712
_________
11,335
_________
2010
€
2009
€
23,689
_________
24,101
_________
As permitted by Section 148 (8) of the Companies Act 1963, the Company Statement of Comprehensive Income
has not been separately disclosed in these financial statements.
4.
Interest payable and similar charges
On loans from Directors
5. Employees
Number of employees
The average monthly numbers of employees
(including the Directors) (for Company & Group) during the year were:
Directors
2011
€
2010
€
5,809
_________
-
_________
5,809
_________
-
_________
2011
Number
2010
Number
4
_________
4
_________
4
_________
4
_________
page 31
GREAT WESTERN MINING Annual Report 2011
5.1.Directors' emoluments
Remuneration and other emoluments
6.
Income Tax relating to continuing operations
2011
€
2010
€
201,249
_________
144,945
_________
201,249
_________
144,945
_________
2011
€
2010
€
Current tax
Current tax expense in respect of the current year
Adjustments recognised in the current year in relation to the current tax of prior years
-
-
_________
-
1,535
_________
Total tax expense
-
_________
1,535
_________
The income tax expense for the year can be reconciled to the accounting loss as follows:
Loss from continuing operations
Income tax expense calculated at 12.5% (2010: 12.5%)
Effects of:
Unused tax losses not recognised as deferred tax assets
(793,151)
_________
(99,144)
(327,258)
_________
(40,907)
99,144
_________
-
-
_________
40,907
_________
-
1,535
_________
Adjustments recognised in the current year in relation to the current tax of prior years
Income tax expense recognised
-
_________
1,535
_________
The tax rate used for the year end reconciliations above is the corporate rate of 12.5% payable by corporate
entities in Ireland on taxable profits under tax law in the jurisdiction of Ireland.
At the statement of financial position date the Group had unused tax losses of €2,227,571 (31 December 2010
€1,434,420) available for offset against future profits which equates to a deferred tax asset of €278,446 (31
December 2010: €179,303). No deferred tax asset has been recognised due to the unpredictability of future
profit streams. Unused tax losses may be carried forward indefinitely.
page 32
GREAT WESTERN MINING Annual Report 2011
7. Loss per share
Basic earnings per share
The basic and weighted average number of ordinary shares used in the calculation of basic earnings per share
are as follows:
(Loss) for the period attributable to equity holders of the parent
Number of ordinary shares in issue - start of year
Effect of shares issued during the year
Weighted average number of ordinary shares for the purposes
of basic earning per share
Basic (loss) per ordinary share (cent)
2010
2011
€
€
(327,258)
(793,151)
_________
_________
28,253,628 28,253,628
11,817,878
_________
-
_________
40,071,506 28,253,628
_________
_________
(1.16)
(1.98)
_________
_________
Diluted earnings per share
There were no potential ordinary shares that would dilute the basic earnings per share.
8.
Intangible assets - Group
Cost
Accumulated amortisation and impairment
Cost
At 1 January 2011
Additions
At 31 December 2011
2011
€
1,231,607
-
_________
1,231,607
_________
2010
€
797,657
-
_________
797,657
_________
Exploration and
Evaluation Assets
€
Total
€
797,657
433,950
_________
1,231,607
_________
797,657
433,950
_________
1,231,607
_________
The Directors have considered expenditure on exploration and evaluation activities which have been capitalised
at cost. No amortisation has been charged in the period. The Directors have reviewed the carrying value of the
exploration and evaluation assets and consider it to be fairly stated and not impaired at 31 December 2011.
The recoverability of the intangible assets is dependent on the future realisation or disposal of
the copper,
silver, gold and other mineral resources.
page 33
GREAT WESTERN MINING Annual Report 2011
9. Financial assets - Company
Group undertakings - unlisted:
Shares at cost
2011
€
2010
€
500,000
_________
500,000
_________
In the opinion of the Directors' the carrying value of the investment is appropriate.
At 31 December 2011 the Company had the following subsidiary undertaking:
Name
Great Western Mining Corporation
Incorporated in Main Activity
Nevada, U.S.A.
Mineral Exploration
Proportion of holding
100%
The aggregate amount of capital and reserves and the results of these undertakings for the last relevant
financial year were as follows:
Great Western Mining Corporation
10.Trade and other receivables
Amounts falling due within one year:
Amounts owed by Group undertaking
Capital and reserves
€
(61,046)
_________
Loss for the year
€
(6,910)
_________
Group
2011
€
Group
2010
€
Company
2011
€
Company
2010
€
-
_________
-
_________
738,684
_________
290,660
_________
-
_________
-
_________
738,684
_________
290,660
_________
All receivables are current and there have been no impairment losses during the year (2010: Nil).
11.Cash and Cash Equivalents
For the purposes of the Consolidated Statement of Cash Flows, cash and cash equivalents include cash in hand
and in banks, net of outstanding bank overdrafts. Cash and cash equivalents at the end of the reporting period
as shown in the consolidated statement of cash flows can be reconciled to the related items in the Consolidated
Statement of Financial Position as follows:
Cash at bank
Group
2011
€
Group
2010
€
Company
2011
€
Company
2010
€
656,057
_________
6,361
_________
628,734
_________
3,686
_________
656,057
_________
6,361
_________
628,734
_________
3,686
_________
page 34
GREAT WESTERN MINING Annual Report 2011
12.Trade and other payables
Amounts falling due within one year
Trade payables
Convertible debt
Other taxes and social welfare costs
Directors' accounts
Other payables
Accruals and deferred income
Group
2011
€
Group
2010
€
Company
2011
€
Company
2010
€
432
100,000
13,560
21,243
21,356
43,425
_________
200,016
_________
4,869
100,000
49,123
79,415
25,903
134,300
_________
393,610
_________
432
100,000
13,560
21,243
21,356
43,348
_________
199,939
_________
4,575
100,000
49,123
68,131
25,903
128,966
_________
376,698
_________
The Group has financial risk management policies in place to ensure that payables are paid within the pre-
agreed credit terms.
13.Share capital
Authorised equity
100,000,000 Ordinary shares of €0.01 each
2011
€
2010
€
1,000,000
1,000,000
_____________________
1,000,000
1,000,000
_____________________
Issued, called up and fully paid:
No. of issued
Shares
Share
Capital
€
Share
Premium
€
Total
Capital
€
28,523,628
At 1 January 2010
Total comprehensive income for the year
Loss for the year
-
Transactions with shareholders, recorded directly in equity
-
Shares issued
_________
28,253,628
_________
At 1 January 2011
Total comprehensive income for the year
Loss for the year
-
Transactions with shareholders, recorded directly in equity
18,236,847
Shares issued for cash
282,536
1,602,234
1,884,770
-
-
-
-
_________
282,536
_________
-
_________
1,602,234
_________
-
_________
1,884,770
_________
-
-
-
182,368
1,888,023
2,070,391
As at 31 December 2011
_________
46,490,475
_________
_________
464,904
_________
_________
3,490,257
_________
_________
3,955,161
_________
page 35
GREAT WESTERN MINING Annual Report 2011
The issued share capital of the company at 31 December 2011 comprised of 46,490,475 ordinary shares of
€0.01 each issued and fully paid (31 December 2010 28,253,628 issued and fully paid)
The holders of Ordinary Shares are entitled to receive dividends as declared from time to time.
The shareholders have all voting powers and full voting rights as permitted under the applicable company laws.
14.Retained Losses
Group
2011
€
Group
2010
€
Company
2011
€
Company
2010
€
Loss at beginning of year
Loss for the year
(1,474,362)
(793,151)
(1,147,104)
(327,258)
(1,467,122)
(820,560)
(1,139,860)
(327,262)
Loss at end of year
_________
_________
_________
(2,267,513) (1,474,362) (2,287,682) (1,467,122)
_________
_________
_________
_________
_________
In accordance with the provisions of the Companies (Amendment) Act 1986, the Company has not presented
an Income Statement. A loss for the year of €820,560 (2010 - loss of €327,262) has been dealt with in the
Statement of Comprehensive Income of the Company.
15.Related party transactions
Details of subsidiary undertakings are shown in Note 9. In accordance with International Accounting Standard
24 - Related Party Disclosures, transactions between group entities that have been eliminated on consolidation
are not disclosed.
Melvyn Quiller, Company director and shareholder, is a relative of Lloyd Quiller whose company LQ Accounting
Solutions provided accounting services to the Company in the year. At 1 January 2011 Great Western Mining
Corporation Plc owed €Nil to LQ Accounting Solutions. During the year, Great Western Mining Corporation
Plc purchased and paid for services from LQ Accounting Solutions to the value of €8,602. At 31 December 2011
Great Western Mining Corporation Plc owed €NIL to LQ Accounting Solutions.
page 36
GREAT WESTERN MINING Annual Report 2011
16.Transactions with Directors
Loans from directors
The directors have advanced loans to the Group. The movements in these loans are as follows:
Name of director
Rate of interest
Repayment date
Amount due to director as at 1 January 2011
Advanced by director in year
Repaid to director in the year
Amount due to director as at 31 December 2011
Maximum outstanding in the year
17.Convertible debt
Redeemable loan
Emmett
O'Connell
0%
on call
Robert
Melvyn
Quiller O'Connell
0%
on call
on call
(72,508)
(12,516)
69,626
_________
(6,511)
(1,911)
3,241
_________
(396)
(268)
-
_________
(15,398)
_________
(5,181)
_________
(664)
_________
(72,508)
_________
(7,279)
_________
(664)
_________
2011
€
2010
€
100,000
_________
100,000
_________
100,000
_________
100,000
_________
On 22 June 2010, director Emmet O'Connell advanced an interest-bearing redeemable convertible loan to the
company in the amount of €100,000. The loan is convertible into the Company's ordinary shares of €0.01
each at the lowest mid-market share price between the advance date and the conversion date or repayable
upon the demand of the director. Until either conversion or repayment, interest on the loan value will accrue
at 3.8% or at the variable lending rate charged by the Bank of Ireland whichever is higher.
18.Post Balance Sheet events
There were no significant post balance sheet events
page 37
GREAT WESTERN MINING Annual Report 2011
19.Financial Instruments and Financial Risk Management
The Group and Company’s principal financial instruments comprise cash and cash equivalents. The main
purpose of these financial instruments is to provide finance for the Group and Company’s operations. The
Group has various other financial assets and liabilities such as receivables and trade payables, which arise
directly from its operations.
It is, and has been throughout 2011 and 2010 the Group and Company’s policy that no trading in derivatives
be undertaken.
The main risks arising from the Group and Company’s financial instruments are foreign currency risk, credit
risk, liquidity risk, interest rate risk and capital risk. The board reviews and agrees policies for managing
each of these risks which are summarised below.
Foreign currency risk
The Group undertakes certain transactions denominated in foreign currencies. Hence, exposures to exchange
rate fluctuations arise. Exchange rate exposures are managed within approved policy parameters utilising
forward exchange contracts where appropriate.
At the years ended 31 December 2011 and 31 December 2010, the Group had no outstanding forward
exchange contracts.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial
loss to the Group. As the Group does not, as yet, have any sales to third parties, this risk is limited.
The Group and Company’s financial assets comprise receivables and cash and cash equivalents. The credit
risk on cash and cash equivalents is limited because the counterparties are banks with high credit-ratings
assigned by international credit rating agencies. The Group and Company’s exposure to credit risk arise
from default of its counterparty, with a maximum exposure equal to the carrying amount of cash and cash
equivalents in its consolidated balance sheet.
The Group does not have any significant credit risk exposure to any single counterparty or any group of
counterparties having similar characteristics. The Group defines counterparties as having similar characteristics
if they are connected entities.
Liquidity risk management
Liquidity risk is the risk that the Group will not have sufficient funds to meet liabilities. Ultimate responsibility
for liquidity risk management rests with the Board of Directors, which has built an appropriate liquidity risk
management framework for the management of the Group and Company’s short-, medium- and long-term
funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate
reserves and by continuously monitoring forecast and actual cash flows and matching the maturity profiles of
financial assets and liabilities. Cash forecasts are regularly produced to identify the liquidity requirements of
the Group. To date, the Group has relied on shareholder funding to finance its operations. The Group had no
borrowing facilities at 31 December 2011.
The Group and Company's financial liabilities as at 31 December 2011 and 31 December 2010 were all
payable on demand, except an interest-bearing redeemable convertible loan advanced from one of the
directors of the company in the year, which is either convertible to ordinary shares or payable on demand
page 38
GREAT WESTERN MINING Annual Report 2011
The expected maturity of the Group and Company’s financial assets (excluding prepayments) as at 31
December 2011 and 31 December 2010 was less than one month.
The Group expects to meet its other obligations from operating cash flows with an appropriate mix of funds
and equity instruments. The Group further mitigates liquidity risk by maintaining an insurance programme to
minimise exposure to insurable losses.
The group had no derivative financial instruments as at 31 December 2011 and 31 December 2010.
Interest rate risk
The Group and Company’s exposure to the risk of changes in market interest rates relates primarily to the
Group and Company’s holdings of cash and short term deposits.
It is the Group and Company’s policy as part of its disciplined management of the budgetary process to
place surplus funds on short term deposit in order to maximise interest earned.
Capital risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as a going
concern while maximising the return to stakeholders through the optimisation of the debt and equity
balance. The Group manages its capital structure and makes adjustments to it, in light of changes in
economic conditions. To maintain or adjust its capital structure, the Group may adjust or issue new shares or
raise debt. No changes were made in the objectives, policies or processes during the years ended 31
December 2011 and 31 December 2010. The capital structure of the Group consists of equity attributable to
equity holders of the parent, comprising issued capital, reserves and retained losses as disclosed in the
consolidated statement of changes in equity.
Fair values
The carrying amount of the Group and Company’s financial assets and financial liabilities is a reasonable
approximation of the fair value.
Hedging
At the year ended 31 December 2011 and 31 December 2010, the Group had no outstanding contracts
designated as hedges.
20.Approval of financial statements
The financial statements were approved by the board on 26 June 2012.
page 39
GREAT WESTERN MINING Annual Report 2011
NOTES
page 40
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