More annual reports from Impact Minerals Limited:
2023 Report Page ii | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued)
CONTENTs
Corporate DireCtory
Chairman’s Letter
review of operations
finanCiaL report
DireCtors’ report
auDitor’s inDepenDenCe DeCLaration
ConsoLiDateD statement of profit or L oss
ConsoLiDateD statement of finan CiaL position
ConsoLiDateD statement of Chan Ges in eQuity
ConsoLiDateD statement of Cash fLows
notes to the C onsoLiDateD finanCiaL statements
DireCtors’ DeCLaration
auDitor’s report
aDDitionaL sharehoLDer information
tenement sCheDuLe
4
5
6
33
34
50
51
52
53
55
56
92
93
95
97
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 3
CORPORATE DiRECTORy
DireCtors
Peter Unsworth
Michael Jones
Paul Ingram
Markus Elsasser
Felicity Gooding
Non-Executive Chairman
Managing Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Company seCretary
Bernard Crawford
reGistereD offiCe
& prinCipaL pLaCe
of Business
26 Richardson Street
West Perth, WA 6005
Telephone: +61 (8) 6454 6666
Facsimile: +61 (8) 6454 6667
Email:
Web:
info@impactminerals.com.au
www. impactminerals.com.au
auDitors
Bentleys Audit and Corporate (WA) Pty Ltd
London House
Level 3, 216 St Georges Terrace
Perth, WA 6000
share reGistry
Computershare Investor Services Pty Ltd
Level 11, 172 St. Georges Terrace
Perth, WA 6000
Telephone: +61 (8) 9323 2000
Facsimile: +61 (8) 9323 2033
seCurities exChanGe
ListinG
The Company is listed on the Australian
Securities Exchange Ltd (“ASX”)
Home Exchange: Perth, Western Australia
ASX Code: IPT
Page 4 | IMPACT MINERALS LTD ANNUAL REPORT 2014
ChAiRmAN’s LETTER
Dear Fellow Shareholder
The year under review has been very positive for shareholders in a number of ways. At a time when
many junior explorers have struggled to raise capital and carry out exploration, Impact has had its most
successful year since its ASX listing in 2006.
Capital raisings from existing and new shareholders including new major shareholder, Squadron
Resources, for a total of $6.9 million and a research and development rebate of $1.2 million resulted in
Impact raising $8.1 million.
The Company’s exploration activities have been very actively pursued with more exciting results
confirming the Company’s optimism for the Commonwealth and Broken Hill projects in New South Wales.
As described in the Review of Operations in this Annual Report, Impact has now shown that the
adjoining Red Hill and Dora East projects at Broken Hill contain robust widths and high grades of 12
different metals – platinum, palladium, gold, rhodium, iridium, osmium, ruthenium, nickel, copper, zinc,
silver and lead. This is unprecedented in the Broken Hill region. The Company’s tenement holdings
have been substantially increased.
The Commonwealth project has always been identified as containing a very large mineralised system.
The Company’s recent drilling, particularly around Silica Hill, has confirmed this with the outstanding
September drill hole CMIPT046 intercept of 41.3 metres at 2.0 g/t gold and 176 g/t silver (4.7 g/t gold
equivalent) from 61 metres; which includes 16.3 metres at 3.7 g/t gold and 246 g/t silver (7.6 g/t gold
equivalent) from 86 m.
This, together with drill holes CMIPT026 and CMIPT011 indicate the potential for a significant deposit.
The Company’s other projects at Mulga Tank (Western Australia), Clermont (Queensland) and Botswana
Uranium, remain valid and strong exploration targets. Management is considering how to take these
projects further.
We welcome to the Board Ms Felicity Gooding who was appointed as a Non-Executive Director of
Impact on 18 February 2016 as Squadron’s representative and thank her predecessor, Aaron Hood, for
his contribution. Ms Gooding is the Chief Operating Officer and Chief Financial Officer of the Minderoo
Group, which represents selected philanthropic and private business holdings of Mr Andrew and Mrs
Nicola Forrest. Felicity is a Chartered Accountant with more than 15 years’ experience and has held
senior positions in a number of accounting and mining companies.
We also welcome the appointment of Mr Bernard Crawford as Company Secretary and Chief Financial
Officer of Impact Minerals on 4 April 2016.
Impact’s management team lead by Managing Director, Dr Mike Jones, has worked extremely hard
over the year and Impact’s exploration results are testimony to their highly professional efforts. On your
behalf I thank them for their great work and commitment to the Company’s success.
peter unsworth
Chairman
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 5
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1. CommonweaLth GoLD-siLver-Base metaL proJeCt (ipt 100%)
The Commonwealth Project comprises three 100% owned exploration licences that cover about
315 sq km of the highly prospective Lachlan Fold Belt about 100 km north of Orange in NSW. The belt
is host to many major gold-silver-copper mines including the Cadia-Ridgeway deposits that contain at
least 25 million ounces of gold and 5 million tonnes of copper (Figure 1).
Recent work at Commonwealth has delivered a possible breakthrough discovery at the Silica Hill
Prospect and as this report goes to press very encouraging drill results are being returned from what
will be a new gold-silver deposit. Work is now focussed on defining the extents of this deposit to help
determine the programme of work required to define a resource.
figure 1. Location of the Commonwealth Project within the Lachlan Fold Belt of NSW, home to many significant gold and copper mines.
A significant amount of work was completed during the year culminating in the major drill programme
that lead to the Silica Hill discovery. The programme comprised about 4,600 m of RC and diamond
drilling and tested a number of geophysical and geochemical targets at three other prospects as well at
Silica Hill. These are the Commonwealth deposit and the Welcome Jack-Walls and Doughnut Prospects
(Figure 2).
Page 6 | IMPACT MINERALS LTD ANNUAL REPORT 2016
The geophysical and geochemical targets drilled, which represent only a modest proportion of the
targets identified thus far at Commonwealth, were generated from a wide range of activities during the
year and all built upon extensive and detailed field mapping of the key areas. The work included:
• a reinterpretation of down hole and surface geophysical electromagnetic (EM) and Sub-Audio
Magnetic (SAM) data which lead to several new down hole surveys being completed and re-
interpreted;
• soil geochemistry surveys;
• a study of the alteration minerals and geochemistry around the Commonwealth deposit utilising an
extensive database of assay data and measurements from a handheld XRF instrument to identify
halos that may help vector towards mineralisation; and
• an interpretation of a ground gravity survey carried out in early 2015. A number of high density
anomalies were identified that may represent possible massive sulphide bodies.
In addition to the Silica Hill discovery, the drill programme successfully identified extensions to the
Commonwealth gold-silver-base metal deposit at both Main Shaft and Commonwealth South and
identified potential for further near surface resources at the Walls Prospect (Figure 2).
1.1 Commonwealth Deposit: main shaft and Commonwealth south
In 2014 Impact declared a maiden Inferred Resource for the Commonwealth deposit prepared in
accordance with the JORC 2012 Code by independent resource consultants Optiro at a 0.5 g/t gold
cut off, of:
720,000 tonnes at 4.7 g/t gold equivalent for a contained 110,000 gold equivalent ounces
comprising 2.8 g/t gold, 48 g/t silver, 1.5% zinc, 0.6% lead and 0.1% copper.
The resource, which is open along trend and at depth, contains both massive sulphide mineralisation
at the Main Shaft prospect and disseminated, vein and lesser massive sulphide mineralization at the
Commonwealth South prospect. It extends from surface to an average depth of 90 m, has a strike
length of 400 m and is up to 25 m thick.
A separate Inferred Mineral Resource (included within the overall resource) has also been calculated for
the massive sulphide lens at Main Shaft alone to demonstrate the high grade nature of such deposits
that are the principal target for Impact’s exploration programme. The Main Shaft Inferred Resource is:
145,000 tonnes at 9.9 g/t gold equivalent for a contained 46,000 gold equivalent ounces
comprising 4.3 g/t gold, 142 g/t silver, 4.8% zinc, 1.7% lead and 0.2% copper.
Note: further information on the resource estimate can be found in Section 1.5. The gold equivalency
is slightly different to that quoted in 2014 only because of changes in metal prices. This change is not
material and there are no other material changes to the Resource Estimate.
In the 2016 drill programme further high grade gold, silver and base metal mineralisation was
discovered in three drill holes down plunge and along trend from the Commonwealth deposit. These
have extended the deposit for at least 30 to 40 metres along trend, up dip and down plunge to the
south. The mineralisation is still open. These results, and the extension of the massive sulphide in
particular, indicate the potential to materially increase the Inferred Resource for the Commonwealth
deposit with further drilling.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 7
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main shaft
At Main Shaft, drill hole CMIPT031 targeted an EM conductor interpreted from a previous downhole
survey and intersected a 7 metre thick zone of massive sulphide mineralisation with exceptional silver
grades (Figure 3). The hole returned:
7 metres at 6.3 g/t gold, 496 g/t silver (15.9 ounces), 7.2% zinc, 2.9% lead and 0.2%
copper (17.7 g/t gold equivalent) from 91 metres
including 3 metres at 10.6 g/t gold, 571 g/t silver (18.4 ounces), 7.8% zinc, 2.1% lead and
0.2% copper (23.0 g/t gold equivalent) from 92 metres and
also including 1 metre at 2.5 g/t gold, 979 g/t silver (31.5 ounces) 8.3% zinc, 4.4% lead and
0.1% copper (21.4 g/t gold equivalent) from 95 metres.
The hole is 10 metres down dip and plunge from the nearest drill hole and the mineralisation is open to
the south east, down plunge. Further drilling is required.
figure 2. Geology and location of the four priority prospects at the Commonwealth Project: Commonwealth, Silica Hill, Welcome Jack
Trend and Doughnut. The Commonwealth Prospect contains the Commonwealth deposit that has two connected parts, Main
Shaft and Commonwealth South.
Page 8 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued)
Commonwealth south
At Commonwealth South two diamond holes targeted extensions to the deposit along trend and down
dip and one diamond hole was drilled close to a previous high grade intercept in RC hole CMIPT017
to better understand the controls on the high grade mineralization (intercept of 4 m at 41.8 g/t gold,
62 g/t silver, 3.8% zinc and 1.6% lead).
Hole CMIPT022, drilled down plunge to previous mineralisation was designed to test a small downhole
EM conductor. No source for the conductor was found. However, the hole returned a thick mineralised
intercept of:
13.6 metres at 2.1 g/t gold, 21 g/t silver, 0.4% zinc and 0.2% lead (2.6 g/t gold equivalent)
from 68.7 metres
including 0.6 metres at 10.8 g/t gold, 44 g/t silver (1.5 ounces), 2.5% zinc and 1% lead
(12.4 g/t gold equivalent).
This is a significant intercept and has extended Commonwealth South mineralisation for 30 metres
along trend to the south and helped confirm the south plunge to the mineralisation (Figures 4 and 5).
Hole CMIPT025 which was drilled up plunge and close to CMIPT017 returned:
2.6 metres at 10.3 g/t gold, 55.7 g/t silver (1.8 ounces), 2.5% zinc and 0.9% lead (12.6 g/t
gold equivalent) from 88.1 metres
including 0.9 metres at 23.3 g/t gold, 94.6 g/t silver (3 ounces), 3.6% zinc and 1.6% lead
(27.1 g/t gold equivalent)
All of these drill results support Impact’s interpretation that the Commonwealth deposit is controlled
by south plunging high grade shoots that are open along trend and at depth (Figure 3). A detailed
structural interpretation is in progress to better understand the orientation of the high grade shoots at
depth.
The results at the Commonwealth deposit also indicate that a further intensive and close spaced drill
programme is now required to continue to expand the resource.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 9
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figure 3. 3D view looking to the north west of the Commonwealth resource (grey outline) and showing: grade shells for gold (yellow
= 1g/t, red/orange = 2 g/t) and copper (green = 500 ppm copper) from drill assay data; interpreted EM conductors (blue
rectangles) and interpreted ore shoots (dashed lines). Recent drill holes CMIPT022 and CMIPT031 indicate mineralisation is
open down plunge in at least 2 areas
1.2 silica hill
At the emerging Silica Hill discovery, significant gold and silver mineralisation has now been intersected
in four holes over an area of 200 metres by 100 metres and down to a depth of 100 metres below
surface (Figures 4, 5 and 6).
Hole CMIPT026 intersected lower grade mineralisation from surface, and Holes CMIPT046, CMIPT043
and CMIPT011 intersected deeper, higher grade parts of the system and also established that the true
thickness of the mineralised zone is about 50 metres.
Page 10 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) figure 4. Surface geology map showing significant drill intercepts at Silica Hill and Main Shaft.
On the two sections drilled so far, it appears that the grade is increasing with depth.
To the north (Figures 4 and 5), Hole CMIPT026 returned 39 metres at 0.3 g/t gold and 16 g/t silver from
5 metres down hole with individual one metre assays up to 1 g/t gold and 32 g/t silver. The underlying
hole CMIPT046 returned
41.3 metres at 2.0 g/t gold and 176 g/t silver (4.7 g/t gold equivalent) from 61 metres;
which includes 16.3 metres at 3.7 g/t gold and 246 g/t silver (7.6 g/t gold equivalent) from
86 m.
As shown in Figure 6, the intercept includes numerous high grade gold and silver intercepts from
individual veins and groups of veins (which have been sampled in detail) including:
1 metre at 12.2 g/t gold and 680 g/t silver
including 0.3 metres at 23 g/t gold and 1,110 g/t silver;
1 metre at 5.3 g/t gold and 924 g/t silver;
1.7 metres at 3.8 g/t gold and 1,176 g/t silver; and
0.7 metres at 1.5 g/t gold and 855 g/t silver.
There are 30 individual assays with more than 2 g/t gold and 12 individual assays with more than
500 g/t silver.
These results define an upper silver-rich zone and lower gold-rich zone to the mineralisation.
The high grade mineralisation lies within a thicker zone of continuous mineralisation that has returned:
74.5 metres at 1.2 g/t gold and 106 g/t silver (2.9 g/t gold equivalent).
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 11
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figure 5. East-West cross section showing results for Holes CMIPT026 and 046.
figure 6. Detail of gold and silver assays for Hole CMIPT046. Note that the gold grades have been cut off at 10 g/t, and silver grades are
at log scale to allow proper visualisation of the grades of up to 10 g/t Au and 1,490 g/t Ag.
Page 12 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) To the south (Figure 7) Hole CMIPT043 returned:
68 metres at 0.5 g/t gold, 43 g/t silver, or 1.3 g/t gold equivalent from 99 metres
including the upper silver-rich zone of 37 metres at 71 g/t silver (2.3 ounces) and 0.1 g/t
gold and the lower gold-rich zone of 18 m at 1.7 g/t gold and 24 g/t silver from 149 metres.
The upper silver rich zone contains eight individual one metre intercepts that returned between 122 g/t
(4 ounces) and 525 g/t (17 ounces) of silver. Two assays of semi-massive sulphide veins about 15 cm
thick in the lower gold-rich part of the system in Hole 043 returned 5.6 g/t and 5.8 g/t gold.
Hole CMIPT011 drilled below CMIPT043 (Figure 7) returned bonanza silver grades with gold as follows:
The mineralised zone in Hole CMIPT011 is comprised of numerous narrow high grade and bonanza
grade sulphide veins that are up to 40 cm thick as well as disseminated sulphides within the rock
surrounding the veins. Both the veins and the surrounding rock contain extensive visible silver minerals
and lesser zinc and lead sulphides.
The overall intercept for Hole CMIPT011 is:
• 48.6 metres at 137 g/t silver (4.4 ounces) and 0.5 g/t gold from 122 metres down hole, or
2.5 g/t gold equivalent.
• 1.75 metres at 1,785 g/t silver (57 ounces) and 1.8 g/t gold from 147.7 metres
including: 0.9 metres at 3,146 g/t silver (101 ounces) and 2.4 g/t gold from 148.1 metres.
• 23 metres at 224 g/t silver (3.6 ounces) and 1.0 g/t gold from 147.7 metres
including: 2.9 metres at 406 g/t silver (13 ounces) and 0.6 g/t gold from 157.6 metres within
which is a 15 cm vein that returned 3,600 g (116 ounces) of silver and 0.4 g/t gold;
and also including: 4 metres at 104 g/t (3.4 ounces) silver and 1.5 g/t gold from 160 metres
and 1.1 metres at 4.7 g/t gold and 23 g/t silver from 169.5 metres.
figure 7. East-West cross section showing results for Holes CMIPT026 and 046.
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In addition it is evident that there is a large silver “halo” of up to 10 to 15 g/t silver in the Silica Hill
rhyolite which extends further outwards over many hundreds of square metres (Figures 4 and 7). It is
possible that this may be a “leakage halo” from depth and accordingly the down-dip extension of the
mineralisation in Holes 043 and 011 is a compelling drill target.
Ongoing studies by Impact now suggest that the mineralisation at Silica Hill and Main Shaft may be
linked at depth. There is a clear overlap in the nature and style of mineralisation, in particular silver, as
well as the alteration minerals between the two prospects. Areas where the two styles of mineralisation
connect will be priority target areas.
1.3 welcome Jack-walls trend
walls prospect
The maiden drill hole at the Walls Prospect located 1.2 km east of Commonwealth discovered a new
20 metre thick zone (true width) of gold and silver mineralisation. The Walls prospect occurs at the
southern end of the Welcome Jack Trend which extends over a strike length of at least one kilometre
and has never been drill tested (Figures 2, 8 and 9).
The first exploration drill hole CMIPT027 has returned a very encouraging thick and robust intercept of:
20 m at 0.5 g/t gold and 27 g/t silver (1 g/t gold equivalent) from 55 metres down hole:
including 12 m at 0.7 g/t gold and 42 g/t (one and a half ounces) of silver (1.3 g/t gold
equivalent)
including 1 m at 2.9 g/t gold and 144 g/t silver and 1.1% zinc (5.7 g/t gold equivalent).
figure 8. Geology of the Welcome Jack-Walls Trend with drill results and IP and soil geochemistry anomalies.
This 20 m thick zone of silver-gold mineralisation at about 50 m from surface is interpreted to be the
down dip extension of high grade veins mined at surface where previous explorers returned rock chip
assays of up to 15 g/t gold and 600 g/t silver. The maiden drill result is highly encouraging for the
discovery of further high grade gold-silver mineralisation and indicates the potential for near surface
open pit resources at Walls.
Page 14 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued)
welcome Jack prospect
An RC drill hole, CMIPT028 has also been completed at the north eastern edge of the Welcome Jack
Trend to test beneath old workings (Figure 8).
The drill hole entered a void that is likely to be the old workings and accordingly no significant results
were returned. A 15 metre thick zone of weak gold anomalism associated with pyrite and lesser
arsenopyrite occurs at about 140 metres depth and is coincident with the edges of an IP anomaly
centred about 250 metres to the west (Figure 9). This anomaly will be tested by drill hole CMIPT029 for
which the RC pre-collar has been completed.
A further drill hole below CMIPT028 will also be required to test beneath the mined extent of the vein
system.
figure 9: Geology of the Welcome Jack Trend with soil geochemistry, IP anomolies and drill hole locations.
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1.4 about the Commonwealth mineral resource estimate and statement of resources
The Inferred Resource at Commonwealth was prepared in accordance with the JORC 2012 Code by
independent resource consultants Optiro. At a 0.5 g/t gold cut off the Inferred Resource is:
Category
inferred
tonnes
720,000
au ppm
ag ppm
Cu%
pb%
2.8
48
0.1
0.6
Zn%
1.5
The resource, which is open along trend and at depth, contains both massive sulphide mineralisation
at the Main Shaft prospect and disseminated, vein and lesser massive sulphide mineralization at the
Commonwealth South prospect. It extends from surface to an average depth of 90 m, has a strike
length of 400 m and is up to 25 m thick.
A separate Inferred Mineral Resource (included within the overall resource) has also been calculated for
the massive sulphide lens at Main Shaft alone to demonstrate the high grade nature of such deposits
that are the principal target for Impact’s exploration programme. The Main Shaft Inferred Resource is:
Category
inferred
tonnes
145,000
au ppm
ag ppm
Cu%
pb%
4.3
142
0.2
1.7
Zn%
4.8
The Commonwealth deposit comprises two areas, Main Shaft and Commonwealth South. The
mineralisation at Main Shaft comprises massive sulphide with high grade gold, silver, zinc, lead and
copper mineralisation at the upper contact between a rhyolite unit and overlying volcanic sedimentary
rocks. Mineralisation at Commonwealth South occurs at both the upper and lower contacts of the
rhyolite and is dominated by thick stringers and disseminations of sulphide, often associated with
intense brecciation and faulting of the rhyolite.
The Commonwealth Resource strike length is 400 m and it is open along trend in particular to the
south. The mineralisation has been defined to a maximum depth of 150 m and is still open.
Twenty one new holes were drilled by Impact in 2014. The total number of holes into the
Commonwealth project is 108, comprising 49 reverse circulation (RC) holes, 45 diamond holes,
10 underground channel samples and four underground drill holes. Of these holes, 52 intersected the
mineralisation wireframe and were used in the estimation. Although some of the holes are from previous
explorers, Impact has twinned some of the higher grade intersections and these have largely confirmed
the grades and widths.
Page 16 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) Quality control measures employed during Impact’s drill programme included the use of certified
standards (1% of total sample population), field duplicates (2% of total sample population) and blanks
(2% of total sample population). No previous quality assurance/quality control (QAQC) has been carried
out at the Commonwealth Project. Analysis of the standards and blanks showed acceptable to good
levels of accuracy in the assaying and little contamination. The duplicate samples matched the originals
with a high degree of precision.
The drill hole database was reviewed and validated by Optiro. Three-dimensional solid wireframes
were constructed from sectional interpretations of the mineralisation using a nominal 0.5 g/t gold cutoff
grade. Drill hole intercepts were composited down-hole to 1 m lengths and gold, silver, copper, zinc,
lead and arsenic grade estimation was carried out using ordinary kriging with hard boundaries.
Three search passes, with increasing search distances and decreasing minimum sample numbers,
were employed to fully inform the model. Less than 1% of blocks were not filled in the first three passes.
Further estimation passes were run to assign mean grades to un-estimated blocks.
The Commonwealth Mineral Resource estimate has been classified as an Inferred Mineral Resource
in accordance with the guidelines of the Australasian Code for the Reporting of Exploration Results,
Mineral Resources and Ore Reserves (the JORC Code, 2012). Mineral Resources have been classified
on the basis of confidence in geological and grade continuity, geological modelling confidence, grade
continuity and limited QAQC. No Measured or Indicated Mineral Resources have been defined.
The Mineral Resource estimate for the Commonwealth Project has been reported above a 0.5 ppm
gold cut-off grade. The estimate has been depleted for previous historic mining. Grades have been
reported as individual elements (gold, silver, zinc, lead and copper) and, in addition, a gold-equivalent
grade has been defined. This has used the following US dollar commodity prices:
Gold $1343/oz; silver $19.72/oz; Copper $2.10/lb; Lead $0.85/lb; Zinc $1.06/lb.
There has been no metallurgical testing of the Commonwealth mineralisation to date and so
no metallurgical recoveries have been incorporated into the gold equivalent calculation. This is
commensurate with the classification of the Commonwealth deposit as an Inferred Mineral Resource.
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2. BroKen hiLL proJeCt
The Broken Hill Project comprises two granted exploration licences (EL7390 and EL8234) and two
exploration licence applications (ELA5793 and ELA5265) that cover 517 square kilometres of rocks
prospective for two distinct styles of mineralisation (Figure 10):
1. Nickel-copper-PGE associated with ultramafic rocks; and
2. Zinc-lead-silver in “Broken Hill-style” deposits hosted mostly by metasedimentary rocks and
amphibolites.
The 2016 year was a very successful one for exploration at Broken Hill with significant high grade
results from three prospects.
At the Red Hill Prospect some of the highest reported drill assays in Australia for platinum group metals
were returned with a standout intercept in RHD012 of:
1.2 metres (true width) at:
10.4 g/t platinum, 10.9 g/t gold, 294 g/t (9.5 ounces) palladium, 4.6 g/t rhodium,
7.2 g/t iridium, 5.6 g/t osmium and 3.1 g/t ruthenium, 7.4% nickel, 1.8% copper and
19 g/t silver.
At the Dora East Prospect high grade zinc-lead-silver mineralization was discovered, and at Platinum
Springs high grade massive nickel-copper-PGE sulphides were confirmed.
In addition Impact increased its land holding in the region by a substantial amount to 517 square kilometres.
figure 10. Impact’s licences in the Broken Hill Project covering 517 square kilometres
Page 18 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued)
2.1 red hill nickel-copper-pGe prospect
During the year a major diamond drill programme was completed at the Red Hill Prospect on E7390.
Good to extremely high grades of nickel-copper-PGE mineralisation, including the rare PGE’s rhodium,
iridium, osmium and ruthenium, were found within 50 m of surface over robust widths in 10 out of the
11 drill holes completed by Impact.
The mineralisation occurs within and adjacent to the host ultramafic intrusion and also within
metasedimentary and pegmatite rocks several metres thick within the ultramafic. Mineralisation is open
along trend and at depth and further drilling is warranted.
The width of the mineralised zones has yet to be established. However it has been determined that
the strike of the main ultramafic units is north east. Thus the true widths of many of the mineralised
intercepts are likely to be thinner than quoted.
The standout intercept at Red Hill was returned from Hole RHD012:
1.2 metres (true width) at:
10.4 g/t platinum, 10.9 g/t gold, 294 g/t (9.5 ounces) palladium,
4.6 g/t rhodium, 7.2 g/t iridium, 5.6 g/t osmium and 3.1 g/t ruthenium,
7.4% nickel, 1.8% copper and 19 g/t silver.
Within a broader intercept of:
3.5 metres at 159 g/t (5.3 ounces) 6PGE+gold 2.9% nickel, 2.3% copper and 14.5 g/t silver
from 67.3m down hole (50 m below surface)
where the 6PGE+gold equals
1.7 g/t rhodium, 2.6 g/t iridium, 2.0 g/t osmium, 1.1 g/t ruthenium, 5 g/t platinum,
6 g/t gold and 144 g/t (4.6 ounces) palladium.
To Impact’s knowledge this is the highest drill intercept for PGE’s ever reported in Australia and is
extremely encouraging for the discovery of a high grade deposit.
The mineralisation is related to dykes of ultramafic rock that have intruded along structures and veins
that cross-cut metasedimentary rocks and pegmatites (coarse quartz-feldspar rocks). The fractures
and veins that control the higher grade mineralisation are commonly better developed in the more
competent pegmatites and detailed logging and mapping of these units is in progress.
Other important intercepts include:
Drill hole rhD014 (Figure 11) which tested the western part of the ultramafic unit and underlying
metasedimentary rocks and returned:
25.4 metres at 0.6 g/t platinum, 1.3 g/t palladium and 0.1 g/t gold (2.0 g/t Pt+Pd+Au),
0.3% copper and 0.3% nickel from 11 metres down hole; including
3.3 metres at 2.1 g/t platinum, 4.9 g/t palladium and 0.4 g/t gold (7.4 g/t Pt+Pd+Au),
0.7% copper and 0.6% nickel from 32.4 metres down hole.
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figure 11. Geology and drill hole locations at Red Hill showing seven significant assays of the 2016 drill programme in holes RHD008, 012,
014, 015, 016, 017 and 019. The standout intercept in hole 012 is highlighted in yellow.
Drill hole RHD015 which tested the eastern part of the ultramafic unit at Red Hill and underlying
metasedimentary rocks (Figure 11) and returned:
3.9 metres at 4.2 g/t platinum, 3.8 g/t palladium and 0.3 g/t gold (8.3 g/t Pt+Pd+Au),
1.4% copper and 0.3% nickel from 58.1 metres down hole; including
0.5 metres at 14.2 g/t platinum, 6.2 g/t palladium and 0.2 g/t gold (20.6 g/t Pt+Pd+Au),
5.2% copper and 0.7% nickel and 50 g/t (1.6 ounces) silver from 60.1 metres down hole.
Drill hole RHD017 which returned:
16 metres at 1.4 g/t platinum, 1.4 g/t palladium, 0.1 g/t gold (2.9 Pt+Pd+Au)
0.3% copper, 0.3% nickel and 8.7 g/t silver from 39 metres down hole; including
1.7 metres at 3.6 g/t platinum, 3.9 g/t palladium, 0.2 g/t gold (7.7 g/t Pt+Pd+Au)
0.6% copper, 0.4% nickel and 20 g/t silver from 41.9 metres down hole; and also including
0.6 metres at 3.2 g/t platinum, 3.9 g/t palladium, 0.1 g/t gold (7.3 g/t Pt+Pd+Au)
1.7% copper, 0.8% nickel and 80 g/t (2.6 ounces) silver from 43.6 metres down hole.
A follow up drill programme at Red Hill has been designed and will be completed in 2017.
Page 20 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued)
2.2 platinum springs nickel-copper-pGe prospect
Very high grade platinum, palladium, nickel and copper assays were also returned from a 0.6 metre
thick unit of massive sulphide intersected in Hole PSD02 at the Platinum Springs Prospect located
about 20 km north east of Broken Hill (Figures 10 and 12).
The hole returned:
0.6 metres at 11.5 g/t platinum, 25.6 g/t palladium, 1.4 g/t gold,
1.3 g/t rhodium, 1.7 g/t iridium, 2.0 g/t osmium and 0.8 g.t ruthenium
7.6% copper, 7.4% nickel and 44.3 g/t silver from 57.1 metres down hole within a broader
intercept of
2.75 metres at 3.5 g/t platinum, 7 g/t palladium, 0.4 g/t gold, 2% copper, 1.9% nickel
and 11.6 g/t silver from 55 metres down hole.
PSD02 was drilled to test a narrow and strongly conductive (>5,000 siemens) electromagnetic (EM)
conductor identified by Impact in a down hole survey of a previous drill hole. A down hole survey of
PSD02 confirmed that the massive sulphide is the source of the conductor.
figure 12. Massive sulphide unit from Platinum Springs
The massive sulphide unit is close to previous high grade PGM-nickel-copper intersected in massive
sulphide in two drill holes completed by previous explorers (Figure 13). These drill holes, which were
not surveyed and whose precise location is unknown, returned:
2 metres at 10.9 g/t platinum, 23.6 g/t palladium, 0.9 g/t gold,
6.1% copper, 4.5% nickel and 35 g/t silver from 45 metres in Hole DD4; and
2.3 metres 8.4 g/t platinum, 3.6% copper and 3% nickel from 47.7 metres; including
0.9 metres at 18.8 g/t platinum, 8.1% copper and 7.5% nickel from 48.2 metres in
Hole GMS-06 (palladium and gold not assayed).
The massive sulphide unit occurs at the base of an ultramafic unit at the contact with underlying
metasedimentary rocks and is interpreted as being magmatic in origin. That is, the sulphides have
crystallised from the ultramafic magma. This is a key component of models for the formation of large
Nickel-copper-PGM sulphide deposits and is very encouraging for the possible future discovery of a
major orebody in the region.
The EM conductor was also in part identified by a ground EM survey completed by Impact late last
year. Initial interpretation of this data suggests further EM conductors may be present to the east and
possibly to the north west of PSD02. These are targets for follow up work.
Detailed field mapping and a soil geochemistry survey covering an area of 800 metres by 700 metres
centred on PSD02 were also completed and are being interpreted.
Very high grade PGM-copper-nickel drill assays have now been returned from two prospects at
Impact’s Broken Hill Project, Platinum Springs and Red Hill.
These are the only two prospects to have been explored in detail and this is encouraging for further
exploration throughout the entire project area. For example, high grade rock chip samples have been
returned from numerous prospects between the Platinum Springs and Moorkai Prospects, a distance
of about 9 km along the Moorkai Intrusive Complex (Figures 10 and 14).
Apart from a few drill holes, none of these areas have been followed up in detail and a follow up work
programme is being designed for the entire Moorkai Intrusive Complex.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 21
REviEw Of OPERATiONs
figure 13. Geology and location of PSD01 and PSD02, previous drill holes and contoured data of previous drill assays for platinum,
palladium and gold (summed from down hole intervals).
Page 22 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) figure 14. Rock chip samples results from the Moorkai Intrusive Complex.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 23
REviEw Of OPERATiONs
2.3 Dora east silver-lead-zinc prospect
Three drill holes at Red Hill also returned, for the first time, significant intercepts of zinc-lead-silver in so
called “Broken Hill-style mineralisation” hosted by “Lode Rocks” similar to those that surround, and are
integral to, the world class 300 Mt Broken Hill silver-lead-zinc deposit located 15 km north west of Red Hill.
The Dora East area was previously part of the Red Hill Prospect but has now been separately defined
as a key prospect in its own right. It is so named because of several small dormant workings within
lode rocks located a few hundred metres to the west on an adjacent tenement that are called Dora.
In Hole RHD018, the Broken Hill-style Lode Rocks comprise variably disseminated, vein and massive
iron, zinc, copper and lead sulphides hosted in garnet-bearing metasedimentary rocks and two
amphibolite units (Figure 15).
figure 15. Geology of the Red Hill and Dora East Prospects with significant results
The lower amphibolite unit contains a five metre thick zone of massive and disseminated zinc and lead
sulphide mineralisation including two separate one metre intervals of high grade zinc sulphides that
returned (Figure 16):
5.1 metres at 10% zinc, 0.8% lead, 40.4 g/t silver from 148.4 metres including
1 metre at 26.8% zinc, 2.8% lead, 133 g/t silver (4 ounces) from 148.9 metres; and
1 metre at 21.4% zinc, 0.8% lead and 31.5 g/t silver (1 ounce) from 152.5 metres
Page 24 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued)
figure 16 High grade zinc sulphide (sphalerite – bronze metallic coloured mineral)
This high grade mineralisation lies within a thicker zone of lower grade mineralisation that returned:
22.7 metres at 2.4% zinc, 0.2% lead and 9.5 g/t silver from 138.9 metres down hole.
The upper amphibolite and surrounding metasedimentary rocks contain a 30 metre thick zone of
patchy iron, copper, zinc and lead sulphides from about 100 metres down hole (Figure 17). One zone of
selectively sampled copper sulphide mineralisation within this thicker zone returned:
0.15 metres at 1.5% copper, 1.3% zinc and 22 g.t silver from 113.6 metres down hole.
A follow up drill hole, RHD020 successfully tested the up-dip extension of the mineralisation and
returned an intercept of:
7 metres at 7% zinc, 1.1% lead and 20.7 g/t silver from 131 metres including
1.6 metres at 22.0% zinc, 3.6% lead and 66.7 g/t silver from 132.4 metres (Figures 15 and 17).
In addition, a zone of good copper and silver grades has been identified that returned:
0.7 metres at 2.4% copper and 22.5 g/t silver from 109.5 metres (Figure 17).
The zinc-silver-lead grades are interpreted to be increasing at depth whereas the copper grades are
interpreted to be increasing towards the surface. The area up dip of Hole RHD020 has also been
identified as an off hole EM conductor and is an immediate drill target (Figure 17).
Hole RHD09 lies 200 metres along trend to the east and returned a thick intercept of lower grade
mineralisation (Figure 15).
82 m at 0.3% zinc, 0.15% lead and 1.5 g/t silver including
0.8 m at 4.2% zinc, 4.5% lead and 18.6 g/t silver.
The mineralisation is open along strike and up and down dip and there are many hundreds of metres of
trend that remain to be drill tested (Figure 15).
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 25
REviEw Of OPERATiONs
Priority Base Metal Target Identified In Major Fold Hinge
Recent detailed mapping and interpretation of geophysical data by Impact indicates that the Lode
Rocks at Dora East are possibly part of a large fold structure.
Fold hinges of this scale are common hosts to thick ore positions at the Broken Hill mine. For comparison
Figure 18 shows a cross section from the Broken Hill mine that demonstrates how laterally continuous
narrow units of sulphide become thicker in the hinge zones of folds. The fold hinge identified by Impact is
a priority target for follow up work including drilling.
In addition, an Induced Polarisation anomaly was identified in this area by Impact in a survey completed
several years ago (Figure 15). The significance of the anomaly was not clear at the time. However in light
of Impact’s recent work this is now a compelling target for disseminated Broken Hill style mineralisation.
These results are all extremely encouraging for the discovery of a significant zinc-lead-silver deposit
at Dora East. In particular, the mineralisation discovered may represent a halo to a larger massive zinc
sulphide body along trend or at depth.
Further drilling is warranted and a follow up work programme to include ground geophysical surveys is
being designed. This work will be carried out as part of the follow up work around the Red Hill Prospect
for high grade PGM-nickel-copper mineralisation.
figure 17. North-South Cross Section for Holes RHD020 and RHD018 looking west.
Page 26 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) figure 18. Cross-section through the Broken Hill Mine showing the relationship between fold hinges and thick ore positions (black areas).
The fold hinges are commonly several hundred metres below surface.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 27
REviEw Of OPERATiONs
Impact has now shown that the adjacent Red Hill and Dora East Prospects contain robust widths and
grades of 12 different metals: platinum, palladium, gold, rhodium, iridium, osmium, ruthenium, nickel,
copper, zinc, silver and lead.
This is unprecedented in the Broken Hill region and indicates the highly unusual and very
prospective nature of this part of Impact’s project area.
2.4 new exploration Licence applications
Impact lodged, in March this year, two new exploration licence applications that have significantly
expanded the Company’s exploration footprint at Broken Hill sevenfold to 517 square kilometres
(Figure 10).
Recent technical work on the nature of the high grade platinum group metal (PGM)-copper-nickel
mineralisation and high grade zinc-lead-silver mineralisation discovered by Impact at its various
prospects within the project, including Red Hill, Dora East and Platinum Springs, has identified the new
licence areas as highly prospective for similar styles of mineralisation.
2.5 about the ownership of the Broken hill project
Impact owns 100% of three of the four exploration licences at Broken Hill (EL8234 and ELA5793 and
ELA5265). The mineral rights for the fourth licence, EL7390, were split in the early 2000’s into the
two different styles of mineralisation and Impact inherited this untidy structure when it purchased
Ni-Cu-PGE joint venture rights in 2013 from Endeavour Minerals Pty Ltd.
During the year Impact acquired EL7390 from Golden Cross Resources Limited and re-negotiated
an associated JV between GCR and Silver City Minerals for Broken Hill-style mineralisation. This now
entitles Impact to:
• 100% of the PGE-copper-nickel mineralisation; and
• 80% of the zinc-lead-silver Broken Hill-style mineralisation in EL7390 in joint venture with Silver City
Minerals Limited (ASX: SCI).
Impact purchased E7390 from Golden Cross Resources Limited for $60,000 cash and a 1% gross
production royalty on all metals to which Impact has rights for. At its election, Impact has the right
to buy back the royalty for $1.5 million cash at anytime up to a Decision to Mine, or, leave the royalty
uncapped during production.
In addition Impact assumed Golden Cross’s joint venture rights for lead-zinc-silver-other metals with
Silver City and, in a related transaction Impact moved to an 80-20 joint venture with Silver City on those
rights for a payment of $50,000 cash and for Silver City’s 20% interest to be free-carried to a Decision
to Mine.
The Broken Hill Project is also part of the investment agreement between Impact Minerals and
Squadron Resources Pty Ltd (see Section 5). Squadron at its sole discretion, now has the right to
invest A$1 million into the Broken Hill project to earn a 19.9% interest in the nickel-copper-PGE rights
on EL7390 and a 19.9% interest in EL8234. Squadron is not liable for any payment of the royalty to
Golden Cross.
Squadron Resources Pty Limited does not have the right to earn into the Broken Hill style
mineralisation on EL7390 and Impact’s exploration licence applications ELA5793 and ELA5265 are
excluded from the Squadron transaction.
Page 28 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) 3. muLGa tanK niCKeL-Copper-pGe proJeCt (impact 100%)
figure 19. Location of the Mulga Tank Project and significant nickel sulphide mines and prospects including Perseverance and Rocky’s
Reward and with new nickel-copper-PGE discoveries in the emerging nickel-copper province to the east.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 29
REviEw Of OPERATiONs
3. muLGa tanK ni-au proJeCt
Impact owns 100% of 13 exploration licences that cover 425 sq km of the highly prospective Minigwal
greenstone belt, 200 km east of Kalgoorlie in the emerging mineral province of the south east Yilgarn
Block, Western Australia (Figure 19).
In 2014 Impact discovered three styles of nickel sulphide mineralisation within the Mulga Tank Dunite
and surrounding rocks:
1. High tenor veins at the base of the Mulga Tank Dunite with drill results of:
0.25 m at 3.8% nickel, 0.7% copper and 0.7 g/t PGE and 0.3 m at 0.7% nickel.
2. High tenor nickel sulphide in multiple komatiites in a flow channel with drill results of:
0.75 m at 0.85% nickel, 0.35% copper and 0.28 g/t PGE (Pt+Pd+Au); and
6.7 m at 0.5% nickel.
3. Extensive disseminated nickel in the Mulga Tank Dunite with drill results of:
2 m at 1.3% nickel including 1 m at 2% nickel and multiple zones of
0.5 m at 0.5% to 1.2% nickel within an intercept of 115 m at 0.3% nickel;
other thick intercepts of 21 m at 0.4% nickel and 59 m at 0.3% nickel.
The style of mineralisation and the nature of the ultramafic rocks are similar to those that host the
significant nickel deposits found at the Perseverance (45 Mt at 2% nickel), Rocky’s Reward (9.6 Mt at
2.4% Ni) and Mt Keith (>2 Mt of contained nickel) mines near Leinster in Western Australia (Figure 19).
In addition the project area occurs in the same geological terrain as the recently discovered Gruyere
deposit that hosts more than 5 million ounces of gold (Figure 19). The Mulga Tank project has been
poorly explored for gold and this will also be a focus of the forward programme.
Exploration for nickel and gold was re-invigorated on the project in mid 2015 with the completion of
three major surveys:
1. a 10,000 line kilometre airborne magnetic and radiometric survey covering most of the 425 sq km
project area at a line spacing of 50 metres (Figure 20);
2. an innovative combined ground and airborne electrical survey comprising a Helicopter-borne Sub
Audio Magnetics (HeliSam) Survey over the Panhandle and Mulga Tank Dunite prospects; and
3. the collection of 2,500 soil geochemistry samples that are now being analysed.
This new data has greatly improved the geological understanding of the entire project area and in
particular over the Mulga Tank Dunite where individual geological layers can now for the first time be
mapped out (Figure 20). This is important because the entire project lies under deep sand cover at
least 50 metres thick in most places.
Page 30 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) figure 20. Comparison of previous magnetic data (left) and new magnetic data (right) over the Mulga Tank Dunite showing the increased
resolution of units within it.
Final data from these surveys are being interpreted to generate new targets for follow up work in 2017.
In the June Quarter 2016 Impact was awarded a grant of $150,000 as part of the Western Australian
Government’s Exploration Incentive Scheme for drilling at the Mulga Tank Project. The EIS, a co-
funding initiative for exploration in under explored areas and awarded on a dollar-for-dollar basis for
direct drilling costs, has been designed to encourage innovative exploration and prioritised high quality,
technically sound proposals that demonstrate new exploration concepts.
4. other proJeCts
Impact still has one Exploration Licence for gold in Queensland, the Clermont Project, and one
Prospecting Licence in Botswana. These projects have been dormant for the past few years but have
considerable exploration merit. Impact is aiming to restart exploration on them in the coming year.
5. CapitaL raisinGs
In August 2015 Impact secured a potential funding package of up to $7.3 million from Squadron
Resources Pty Ltd, the private mining investment vehicle of the Minderoo Group which itself represents
selected philanthropic and commercial interests of Andrew and Nicola Forrest.
Securing Squadron was a milestone development for Impact and its shareholders and it allowed Impact
to forge ahead with is exploration programmes over the year and raise further funds with the substantial
participation of its existing shareholders.
During the year Impact issued 222,432,015 shares and raised and received a total of $8.1 million in
funding which comprised:
1. a initial $3,000,000 investment by Squadron Resources Pty Ltd;
2. a 1 for 6 renounceable rights issue and placement at 2.1 cents per share that raised $1.983 million;
3. a Share Purchase Plan (SPP) and placement that raised $1.922 million at 2.4 cents per share; and
4. a Research and Development Rebate of $1,205,222.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 31
REviEw Of OPERATiONs
Given the difficult time for the resource sector in the 2016 financial year this was an excellent outcome
for the company.
The key financial terms of the investment by Squadron are:
1. An initial $2 million investment in return for interest-free 3 year secured convertible notes, convertible
only into ordinary shares at the lower of 2.1 cents per share or 80% of the 30 day VWAP and 45
million attaching unlisted call options to acquire ordinary shares at 3.25 cents per share (a further
possible investment of up to about $1.46 million.
2. A $1 million placement of ordinary shares at 2.1 cents per share with 26,428,572 attaching 3 year
unlisted call options at 3.25 cents per share (a further potential investment of about $0.86 million).
3. The option for Squadron at is sole discretion to invest a further $1 million into either or both of
the Commonwealth and Broken Hill projects for an initial 19.9% interest after Impact has spent a
combined total of $2.5 million on the two projects.
Impact recently notified Squadron that it had reached the $2.5 million expenditure threshold and as this
report goes to press, Squadron is considering its investment decision.
6. Competent person’s statement
The review of exploration activities and results contained in this report is based on information compiled
by Dr Mike Jones, a Member of the Australian Institute of Geoscientists. He is a director of the company
and works for Impact Minerals Limited. He has sufficient experience which is relevant to the style of
mineralisation and types of deposits 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 (the JORC Code). Dr Jones has consented
to the inclusion in the report of the matters based on his information in the form and context in which
it appears.
Impact Minerals confirms that it is not aware of any new information or data that materially affects the
information included in the previous market announcements referred to and in the case of mineral
resource estimates, that all material assumptions and technical parameters underpinning the estimates
continue to apply and have not materially changed.
Page 32 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued)
fiNANCiAL REPORT
fOR yEAR ENDED 30 JUNE 2016
CONTENTs
DIRECTORS’ REPORT
AUDITOR’S INDEPENDENCE DECLARATION
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
CONSOLIDATED STATEMENT OF CASH FLOWS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DIRECTORS’ DECLARATION
AUDITOR’S REPORT
ADDITIONAL SHAREHOLDER INFORMATION
TENEMENT SCHEDULE
34
50
51
52
53
55
56
92
93
95
97
DiRECTORs’ REPORT
Your Directors present their report on the consolidated entity consisting of Impact Minerals Limited and
its subsidiaries at the end of the year ended 30 June 2016. Throughout the report, the consolidated
entity is referred to as the Group.
DireCtors
The following persons were Directors of Impact Minerals Limited during the whole of the financial year
and up to the date of this report unless noted otherwise:
Peter Unsworth
Michael Jones
Paul Ingram
Markus Elsasser
Felicity Gooding (appointed 18 February 2016)
Aaron Hood (appointed 5 August 2015, resigned 18 February 2016)
prinCipaL aCtivities
The principal activity of the Group during the financial year was exploration for deposits of uranium,
nickel, gold, copper and platinum group elements.
finanCiaL resuLts
The consolidated loss of the Group after providing for income tax for the year ended 30 June 2016 was
$977,735 (2015: $4,757,575).
DiviDenDs
No dividends have been paid or declared since the start of the financial year. No recommendation for
the payment of a dividend has been made by the Directors.
operations anD finanCiaL review
Information on the operations of the Group and its prospects is set out in the “Review of Operations”
section of this Annual Report.
Exploration and evaluation costs totalling $186,489 (2015: $4,316,428) were expensed during the year
in accordance with the Group’s accounting policy. The expensed exploration and evaluation costs for
the year ended 30 June 2016 primarily comprise business development activities on potential new
projects.
As at 30 June 2016 the Group had net assets of $11,689,939 (2015: $6,932,818) including cash and
cash equivalents of $3,929,972 (2015: $571,981).
Page 34 | IMPACT MINERALS LTD ANNUAL REPORT 2016
siGnifiCant ChanGes in the state of affairs
Significant changes in the state of affairs of the Group during the financial year were as follows:
On 17 July 2015 the Company announced that it had agreed the terms of the funding of up to $7.3
million from Squadron Resources Pty Ltd (“Squadron”), part of the Minderoo Group, Andrew Forrest’s
private investment vehicle (“Squadron Transaction”). The key terms of the Squadron Transaction were
as follows:
• an initial $3 million investment comprising the issue of interest-free convertible notes for $2 million
dollars (convertible to shares at a price which is the lower of 2.1 cents or 80% of the 30-day volume
weighted average price as at the date notice of conversion is given) and a $1 million placement of
shares at 2.1 cents per share;
the issue of 71,428,572 options (comprising 45,000,000 warrants and 26,428,572 placement
options) exercisable at 3.25 cents a share to raise approximately $2.3 million on exercise;
the option for Squadron to invest a further $1 million into either or both of the Commonwealth
Project and Broken Hill Project to earn a 19.9% interest after the Company has spent a combined
total of $2.5 million on the two projects; and
the appointment of Squadron’s nominee to the Board as a non-executive director.
•
•
•
The key elements of the Squadron transaction were approved by shareholders at the Company’s 2015
Annual General Meeting.
In October 2015 the Company successfully completed a one for six renounceable rights issue to
existing shareholders at an issue price of 2.1 cents for each new share raising $1,983,181 before costs.
Of the 94,437,193 new ordinary shares offered, a total of 45,686,370 shares were accepted by eligible
shareholders and a further 10,288,153 shares were applied for by shareholders as shortfall shares. The
remaining 38,462,670 shares were placed to sophisticated investors.
In May 2016 the Company successfully completed a Share Purchase Plan (“SPP”) raising $1,084,000.
Under the SPP eligible shareholders were entitled to subscribe for up to $15,000 of new fully paid
ordinary shares at an issue price of 2.4 cents per share. Under the SPP 45,166,683 new shares were
issued to eligible shareholders.
Also during May 2016, the Company raised $838,200 (before costs) via a placement of 34,925,001
shares at 2.4 cents per share to a number of professional and sophisticated investors.
There were no other significant changes in the state of affairs of the Group during the financial year.
events sinCe the enD of the finanCiaL year
There has not arisen in the interval between the end of the financial year and the date of this report
any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors, to
affect significantly the operations, the results of those operations, or the state of affairs of the Group in
future financial years.
LiKeLy DeveLopments anD expeCteD resuLts of
operations
The Directors are not aware of any developments that might have a significant effect on the operations
of the Group in subsequent financial years not already disclosed in this report.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 35
DiRECTORs’ REPORT
environmentaL reGuLation
The Group is subject to significant environmental regulation in respect of its exploration activities.
Tenements in Western Australia, New South Wales and Queensland are granted subject to adherence
to environmental conditions with strict controls on clearing, including a prohibition on the use of
mechanised equipment or development without the approval of the relevant government agencies, and
with rehabilitation required on completion of exploration activities. These regulations are controlled by
the Department of Mines and Petroleum (Western Australia), the Department of Industry, Resources
and Energy (New South Wales) and the Department of Natural Resources and Mines (Queensland).
Impact Minerals Limited conducts its exploration activities in an environmentally sensitive manner and
the Group is not aware of any breach of statutory conditions or obligations.
Greenhouse gas and energy data reporting requirements
The Directors have considered compliance with both the Energy Efficiency Opportunity Act 2006 and
the National Greenhouse and Energy Reporting Act 2007 which requires entities to report annual
greenhouse gas emissions and energy use. The Directors have assessed that there are no current
reporting requirements for the year ended 30 June 2016, however reporting requirements may change
in the future.
information on DireCtors
peter unsworth
non-executive Chairman, Director since 28 april 2006
Qualifications
Experience
B.Com.
Mr Unsworth, formerly a chartered accountant, has more than 35 years’
experience in the corporate finance, investment, and securities industries
and has a wealth of management experience with both public and private
companies. A former Executive Director with a leading Western Australian
stockbroking company, Mr Unsworth has been a Director of a number of
public exploration and mining companies. He is a Director of the Western
Australian Government owned Gold Corporation (operator of The Perth
Mint), having previously been a Director and Chairman from 1996 to 2008.
Other current
directorships
Former directorships in
last 3 years
None
None
Special responsibilities
Chair of the Board
Interests in shares and
options
Ordinary Shares – Impact Minerals Limited
Unlisted Options – Impact Minerals Limited
13,771,875
10,000,000
Page 36 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) michael Jones
managing Director, Director since 31 march 2006
Qualifications
Experience
PhD, MAIG
Dr Jones completed undergraduate and post-graduate studies in Mining
and Exploration Geology at Imperial College, London. His Ph.D. work on
gold mineralisation saw him move to Western Australia in 1988 to work
for Western Mining Corporation exploring for gold and nickel deposits
in the Yilgarn. From 1994 he consulted to the exploration and mining
industry specialising in the integration of geological field mapping and
the interpretation of geochemical, geophysical and remotely sensed data
for target generation. Dr Jones has worked on over 80 projects both in
Greenfields and near mine exploration in a wide variety of mineralised
terrains and was the founding Director of Lithofire Consulting Geologists
in Perth, Australia. He was also the team leader during the discovery of a
significant gold deposit at the Higginsville Mining Centre, near Kalgoorlie
and an iron ore deposit near Newman, both in Western Australia.
Other current
directorships
None
Former directorships in
last 3 years
Invictus Gold Limited (delisted 10 January 2014 following the merger with
Impact Minerals Limited)
Special responsibilities
Managing Director
Interests in shares and
options
Ordinary Shares – Impact Minerals Limited
Unlisted Options – Impact Minerals Limited
6,881,718
25,000,000
paul ingram
Qualifications
Experience
Other current
directorships
Former directorships in
last 3 years
non-executive Director, Director since 27 september 2009
B.AppSc, AIMM, MICA
Mr. Ingram is a geologist with extensive experience in managing major
mineral exploration programs for several publicly listed companies and has
been involved in the mining sector for over forty years. He has designed
and implemented innovative techniques for exploration in remote areas,
and has managed projects in countries throughout Australia and east Asia.
A-Cap Resources Limited (Director since June 2009)
Consolidated Global Investments Limited since September 2006
Australian Pacific Coal Limited (resigned 30 October 2015)
Special responsibilities
None
Interests in shares and
options
Ordinary Shares – Impact Minerals Limited
Unlisted Options – Impact Minerals Limited
580,680
5,000,000
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 37
DiRECTORs’ REPORT
information on DireCtors (ContinueD)
markus elsasser
non-executive Director, Director since 9 august 2012
Qualifications
Experience
Other current
directorships
Former directorships in
last 3 years
PhD
Dr. Markus Elsasser is a German financier and investor in the mineral
resources industry. He is Head of the Elsasser family office ‘M. Elsasser
& Cie AG 1971’ in Dusseldorf, Germany. Dr. Elsasser has previously been
Director of Finance at the Dow Chemical Company in Germany. He has
extensive General Management experience with former appointments as
Managing Director in Australia and Singapore in the chemical and food
industries.
None
Stellar Resources Limited (resigned 3 February 2016)
Special responsibilities
None
Interests in shares and
options
Ordinary Shares – Impact Minerals Limited
Unlisted Options – Impact Minerals Limited
23,310,402
5,000,000
felicity Gooding
non-executive Director, Director since 18 february 2016
Qualifications
Experience
Other current
directorships
Former directorships in
last 3 years
B.Com, CA
Ms Gooding is the Chief Operating Officer and Chief Financial Officer of the
Minderoo Group, the philanthropic and private business holdings of Mr and
Mrs Andrew and Nicola Forrest.
A Chartered Accountant with more than 15 years’ experience, Ms Gooding
has specialised in due diligence, mergers and acquisitions, and equity and
debt financing across various sectors in Washington DC, Singapore and
London.
Ms Gooding has held senior positions at PwC, Diageo Plc and Fortescue
Metals Group Ltd where she was instrumental in the raising of more than
A$5 billion for project expansion financing. Prior to joining Minderoo,
Ms Gooding was an executive at potash development company, Sirius
Minerals Plc.
None
Vimy Resources Limited (resigned 26 May 2016)
Special responsibilities
None
Interests in shares and
options
Ordinary Shares – Impact Minerals Limited
Unlisted Options – Impact Minerals Limited
Nil
Nil
Page 38 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) Company seCretary
Bernard Crawford, B.Com, Ca, mBa, aCis (appointed 4 april 2016)
Mr Crawford is a Chartered Accountant with over 20 years’ experience in the resources industry in
Australia and overseas. He has held various positions in finance and management with NYSE, TSX
and ASX listed companies. Mr Crawford is the CFO and/or Company Secretary of a number of public
companies. Mr Crawford is an associate member of Chartered Secretaries & Administrators and the
Governance Institute of Australia (formerly Chartered Secretaries Australia).
michael Jones, phD, maiG (appointed 3 march 2016, resigned 4 april 2016)
Refer above for details of Mr Jones’ experience.
James Cooper-Jones, B.a / B.Com, sa fin, Giacert (resigned 3 march 2016)
meetinGs of DireCtors
The numbers of meetings of the Company’s board of Directors held during the year ended 30 June
2016, and the numbers of meetings attended by each Director were:
Peter Unsworth
Michael Jones
Paul Ingram
Markus Elsasser
Felicity Gooding (appointed 18 February 2016)
Aaron Hood (appointed 5 August 2015,
resigned 18 February 2016)
number of
meetings attended
number of
meetings eligible
to attend
6
6
6
2
2
3
6
6
6
6
2
3
retirement, eLeCtion anD Continuation in offiCe of
DireCtors
Ms Gooding was appointed to the Board on 18 February 2016 and by virtue of Article 6.3(j) of the
Company’s Constitution and ASX Listing Rule 14.4 will stand for re-election at the Annual General
Meeting.
Mr Elsasser, being a Director retiring by rotation who, being eligible, will offer himself for re-election at
the Annual General Meeting.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 39
DiRECTORs’ REPORT
remuneration report (auDiteD)
The Directors present the Impact Minerals Limited 2016 Remuneration Report, outlining key aspects of
our remuneration policy and framework, and remuneration awarded this year.
The report contains the following sections:
(a) Key management personnel (KMP) covered in this report
(b) Remuneration governance and the use of remuneration consultants
(c) Executive remuneration policy and framework
(d) Relationship between remuneration and the Group’s performance
(e) Non-executive Director remuneration policy
(f) Voting and comments made at the Company’s 2015 Annual General Meeting
(g) Details of remuneration
(h) Service agreements
(i) Details of share-based compensation and bonuses
(j) Equity instruments held by key management personnel
(k) Loans to key management personnel
(l) Other transactions with key management personnel
(a) Key management personnel covered in this report
Non-Executive and Executive Directors (see pages 36 to 38 for details about each Director)
Peter Unsworth
Michael Jones
Paul Ingram
Markus Elsasser
Felicity Gooding (appointed 18 February 2016)
Non-Executive Chairman
Managing Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Aaron Hood (appointed 5 August 2015, resigned 18 February 2016)
Non-Executive Director
Other key management personnel
name
position
Bernard Crawford (appointed 4 April 2016)
Company Secretary
James Cooper Jones (resigned 3 March 2016)
Company Secretary
(b) remuneration governance and the use of remuneration consultants
The Company does not have a Remuneration Committee. Remuneration matters are handled by the full
Board of the Company. In this respect the Board is responsible for:
•
• operation of the incentive plans which apply to Executive Directors and senior executives (the
the over-arching executive remuneration framework;
executive team), including key performance indicators and performance hurdles;
• remuneration levels of executives; and
• Non-Executive Director fees.
The objective of the Board is to ensure that remuneration policies and structures are fair and
competitive and aligned with the long-term interests of the Company.
In addition, all matters of remuneration are handled in accordance with the Corporations Act
requirements, especially with regard to related party transactions. That is, none of the Directors
participate in any deliberations regarding their own remuneration or related issues.
Independent external advice is sought from remuneration consultants when required, however no
advice has been sought during the period ended 30 June 2016.
Page 40 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) remuneration report (auDiteD) (ContinueD)
(c) executive remuneration policy and framework
In determining executive remuneration, the Board aims to ensure that remuneration practices are:
• competitive and reasonable, enabling the Company to attract and retain key talent;
• aligned to the Company’s strategic and business objectives and the creation of shareholder value;
•
• acceptable to shareholders.
transparent and easily understood; and
All executives receive consulting fees or a salary, part of which may be taken as superannuation,
and from time to time, options. The Board reviews executive packages annually by reference to the
executive’s performance and comparable information from industry sectors and other listed companies
in similar industries.
All remuneration paid to specified executives is valued at the cost to the Group and expensed. Options
are valued using a Black-Scholes option pricing model.
(d) relationship between remuneration and the Group’s performance
Emoluments of Directors are set by reference to payments made by other companies of similar size and
industry, and by reference to the skills and experience of Directors. Fees paid to Directors are not linked
to the performance of the Group. This policy may change once the exploration phase is complete and the
Group is generating revenue. At present the existing remuneration policy is not impacted by the Group’s
performance including earnings and changes in shareholder wealth (e.g. changes in share price).
The Board has not set short term performance indicators, such as movements in the Company’s
share price, for the determination of Director emoluments as the Board believes this may encourage
performance which is not in the long term interests of the Company and its shareholders. The Board
has structured its remuneration arrangements in such a way it believes is in the best interests of
building shareholder wealth in the longer term. The Board believes participation in the Company’s
Incentive Option Scheme motivates key management and executives with the long term interests of
shareholders.
(e) non-executive director remuneration policy
The Board policy is to remunerate Non-Executive Directors at commercial market rates for comparable
companies for their time, commitment and responsibilities. Non-executive Directors receive a Board
fee but do not receive fees for chairing or participating on Board committees. Board members are
allocated superannuation guarantee contributions as required by law, and do not receive any other
retirement benefits. From time to time, some individuals may choose to sacrifice their salary or
consulting fees to increase payments towards superannuation.
The maximum annual aggregate Non-executive Directors’ fee pool limit is $150,000 as disclosed in the
Company’s Prospectus dated 16 October 2006.
Fees for Non-Executive Directors are not linked to the performance of the Group. Non-executive
Directors’ remuneration may also include an incentive portion consisting of options, subject to approval
by shareholders.
(f) voting and comments made at the Company’s 2015 annual General meeting
Impact Minerals Limited received more than 99% of “yes” votes on its Remuneration Report for the
2015 financial year. The Company did not receive any specific feedback at the AGM or throughout the
year on its remuneration practices.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 41
DiRECTORs’ REPORT
remuneration report (auDiteD) (ContinueD)
(g) Details of remuneration
The following tables show details of the remuneration received by the Group’s key management
personnel for the current and previous financial year.
2016
short-term benefits
post-
employment
benefits
share-based
payments
salary
and fees
$
non-
monetary
Benefit
$
super-
annuation
$
shares
$
options
$
total
$
% of
remuner-
ation to
total from
shares and
options
%
name
Directors
P Unsworth
M Jones
P Ingram
M Elsasser
F Gooding (1)
A Hood (2)
executives
65,000
223,550
25,000
27,375
10,417
12,500
B Crawford (3)
30,300
J Cooper-Jones (4) 132,987
Totals
527,129
–
–
–
–
–
–
–
–
–
6,175
–
2,375
–
–
–
–
12,634
21,184
–
–
–
–
–
–
–
–
–
60,163
131,338
150,407
373,957
30,081
30,081
–
–
–
57,456
57,456
10,417
12,500
30,300
46%
40%
52%
52%
–
–
–
22,171
167,792
13%
292,903
841,216
(1) Appointed 18 February 2016, Ms Gooding’s fees are payable to Squadron Resources Pty Ltd
(2) Appointed 5 August 2015, resigned 18 February 2016, Mr Hood’s fees were paid to Squadron
Resources Pty Ltd
(3) Appointed 4 April 2016
(4) Resigned 3 March 2016
No components of remuneration are linked to the performance of the Group.
Page 42 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) remuneration report (auDiteD) (ContinueD)
2015
short-term benefits
post-
employment
benefits
share-based
payments
salary
and fees
$
non-
monetary
Benefit
$
super-
annuation
$
shares
$
options
$
total
$
% of
remune r-
ation to
total from
shares and
options
%
name
Directors
P Unsworth
M Jones
P Ingram
M Elsasser
executives
65,000
223,550
12,500
12,500
J Cooper-Jones
138,750
Totals
452,300
–
–
–
–
–
–
6,175
–
1,188
–
–
–
6,467
77,642
16,167
239,717
12,500
12,500
3,233
3,233
29,421
28,233
8%
7%
53%
56%
13,181
–
11,054
162,985
7%
20,544
25,000
40,154
537,998
No components of remuneration are linked to the performance of the Group.
(h) service agreements
M Jones, Managing Director
Mr Jones is remunerated pursuant to an ongoing Consultancy Services Agreement. Mr Jones was paid
fees of $223,550 for the year ended 30 June 2016. The notice period (other than for gross misconduct)
is three months.
B Crawford, Chief Financial Officer and Company Secretary (appointed 4 April 2016)
Mr Crawford is remunerated pursuant to the terms of a Consultancy Agreement to fulfil the duties of the
Company Secretary and Chief Financial Officer. Fees paid during the year totalled $30,300 and were
charged at usual commercial rates on a daily basis. The agreement may be terminated by either party
on one months’ written notice.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 43
DiRECTORs’ REPORT
remuneration report (auDiteD) (ContinueD)
(i) Details of share-based compensation and bonuses
options
Options over ordinary shares in Impact Minerals Limited are granted under the Employee Option
Acquisition Plan (“Option Plan”). Participation in the scheme and any vesting criteria are at the Board’s
discretion and no individual has a contractual right to participate in the scheme or to receive any
guaranteed benefits. Any options issued to Directors of the Company are subject to shareholder
approval.
Details of options provided as remuneration to Directors and senior management during the current
year are set out below.
option
series
26
27
28
Grant date vesting date expiry date
exercise
price
value per
option at
grant date % vested
29 Sep 2015
29 Sep 2016
29 Sep 2018
$0.0367
29 Sep 2015
29 Sep 2017
29 Sep 2019
$0.045
29 Sep 2015
29 Sep 2018
29 Sep 2020
$0.07
$0.0139
$0.0149
$0.0143
0%
0%
0%
The fair value of options at grant date are independently determined using a Black-Scholes option
pricing model that takes into account the exercise price, the term of the option, the impact of dilution,
the share price at grant date and expected price volatility of the underlying share, the expected
dividend yield and the risk-free interest rate for the term of the option.
The following grants of share based payment compensation were made to key management personnel
during the current financial year:
During the financial year
option
series
number
granted
number
vested and
exercisable
% of grant
vested
% of grant
forfeited
% of
compen sation
for the year
consisting of
options
name
Directors
P Unsworth
26, 27, 28
8,000,000
M Jones
P Ingram
26, 27, 28 20,000,000
26, 27, 28
4,000,000
M Elsasser
26, 27, 28
4,000,000
executives
J Cooper-Jones
26, 27, 28
6,000,000
–
–
–
–
–
0%
0%
0%
0%
0%
0%
0%
0%
46%
40%
52%
52%
0%
83%
13%
Page 44 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) remuneration report (auDiteD) (ContinueD)
value of options issued to directors and executives
The following table summarises the value of options granted, exercised or lapsed to key management
personnel during the current financial year:
value of options
granted at the
grant date (i)
$
value of options
exercised at the
exercise date
$
value of options
lapsed at the date
of lapse (ii)
$
name
Directors
P Unsworth
M Jones
P Ingram
M Elsasser
executives
114,000
285,000
57,000
57,000
–
–
–
–
–
total
$
114,000
285,000
57,000
57,000
–
–
–
–
J Cooper-Jones
85,500
(11,727)
73,773
(i) The value of options granted during the financial year is calculated as at the grant date using a
binomial pricing model. This grant date value is allocated to remuneration of key management
personnel on a straight-line basis over the period from grant date to vesting date.
(ii) The value of options lapsing during the period reflects the total fair value determined at time of lapse.
Further information on the fair value of share options and assumptions is set out in note 24 to the
financial statements.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 45
DiRECTORs’ REPORT
remuneration report (auDiteD) (ContinueD)
(j) equity instruments held by key management personnel
The following tables detail the number of fully paid ordinary shares and options over ordinary shares
in the Company that were held during the financial year and the previous financial year by key
management personnel of the Group, including their close family members and entities related to them.
options
2016
Directors
opening
Balance
1 July
no.
Granted
as
remun-
eration
no.
options
exer-
cised
no.
net
change
other
no.
Balance
at 30
June
no.
vested
but not
exercis-
able
no.
vested
and
exercis-
able
no.
vested
during the
year
no.
P Unsworth
4,008,000 8,000,000
– (2,008,000) 10,000,000
– 2,000,000
M Jones
P Ingram
10,008,000 20,000,000
– (5,008,000) 25,000,000
– 5,000,000
2,000,000 4,000,000
– (1,000,000) 5,000,000
– 1,000,000
M Elsasser
2,000,000 4,000,000
– (1,000,000) 5,000,000
– 1,000,000
executives
J Cooper-
Jones
1,500,000 6,000,000
– (6,500,000) 1,000,000
–
–
19,516,000 42,000,000
– (15,516,000)46,000,000
– 9,000,000
–
–
–
–
–
–
2015
Directors
P Unsworth
4,008,000
M Jones
P Ingram
10,008,000
2,000,000
M Elsasser
2,000,000
executives
J Cooper-
Jones
1,500,000
19,516,000
–
–
–
–
–
–
–
–
–
–
–
–
– 4,008,000
– 4,008,000 2,000,000
– 10,008,000
– 10,008,000 5,000,000
– 2,000,000
– 2,000,000 1,000,000
– 2,000,000
– 2,000,000 1,000,000
– 1,500,000
– 1,500,000 1,000,000
– 19,516,000
– 19,516,000 10,000,000
During the year, no ordinary shares in the Company were issued as a result of the exercise of
remuneration options.
Page 46 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) remuneration report (auDiteD) (ContinueD)
shareholdings
Granted as
remuneration
no.
options
exercised
no.
net change
other
no.
Balance
at 30 June
no.
opening
Balance
1 July
no.
12,771,875
6,800,000
438,635
2016
Directors
P Unsworth
M Jones
P Ingram
M Elsasser
22,543,357
–
–
142,045(1)
142,045(1)
42,553,867
284,090
2015
Directors
P Unsworth
M Jones
P Ingram
12,771,875
6,800,000
–
M Elsasser
22,117,222
–
–
426,135
426,135
41,689,097
852,270
–
–
–
–
–
–
–
–
–
–
1,000,000
13,771,875
81,718
–
6,881,718
580,680
625,000
23,310,402
1,706,718
44,544,675
–
–
12,500
12,771,875
6,800,000
438,635
–
22,543,357
12,500
42,553,867
(1) These shares were in respect of remuneration for the year ended 30 June 2015 but were issued in
July 2015.
During the year ended 30 June 2015, shares were issued to Directors in lieu of Directors fees. The fair
value of these shares issued was determined based on the remuneration for the Directors as approved
at the Company’s Annual General Meeting held on 28 November 2014 and the weighted average fair
value of those equity instruments, determined by reference to market price, was $0.022.
The assessed fair value at grant date of options granted to individuals is allocated equally over the
period from grant date to vesting date, (and the amount included in the remuneration tables above). Fair
values at grant date are determined using a Black-Scholes option pricing model that takes into account
the exercise price, the term of the option, the impact of dilution, the share price at grant date and
expected volatility of the underlying share, the expected dividend yield and the risk free interest rate for
the term of the option.
As at the date of this report the shareholdings of key management personnel were the same as at 30
June 2016.
(k) Loans to key management personnel
There were no loans to individuals or members of key management personnel during the financial year
or the previous financial year.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 47
DiRECTORs’ REPORT
remuneration report (auDiteD) (ContinueD)
(l) other transactions with key management personnel
There were no other transactions with key management personnel during the financial year or the
previous financial year.
end of remuneration report (audited)
shares unDer option
Unissued ordinary shares of the Company under option at the date of this report are as follows:
Date options granted
expiry Date
issue price of
shares
number under
option
20 December 2012, 16 January
2013 and 14 November 2013
7 August 2015
29 September 2015 and
13 May 2016
21 October 2015
29 September 2015 and
13 May 2016
29 September 2015 and
13 May 2016
30 November 2016
7 August 2018
29 September 2018
21 October 2018
$0.10
$0.0325
$0.0367
$0.0325
12,400,000
45,000,000
27,000,000
26,428,572
29 September 2019
$0.045
15,500,000
29 September 2020
$0.07
15,500,000
141,828,572
No option holder has any right under the options to participate in any other share issue of the Company
or any other entity.
shares issueD on the exerCise of options
There were no shares issued on the exercise of options during the year and up to the date of this
report.
Corporate GovernanCe statement
The Company’s 2016 Corporate Governance Statement has been released as a separate document
and is located on the Company’s website at http://impactminerals.com.au/corporate-governance/.
proCeeDinGs on BehaLf of the ConsoLiDateD entity
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to 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 part of those
proceedings.
Page 48 | IMPACT MINERALS LTD ANNUAL REPORT 2016
(continued) inDemnifiCation anD insuranCe of DireCtors
anD offiCers
During the financial year, the Company paid a premium to insure the Directors and officers of the
consolidated entity against any liability incurred as a Director or officer to the extent permitted by the
Corporations Act 2001. The contract of insurance prohibits the disclosure of the nature of the liabilities
covered or the amount of the premium paid.
The Group has not entered into any agreement with its current auditors indemnifying them against
claims by a third party arising from their position as auditor.
non-auDit serviCes
The Company may decide to employ the auditor on assignments additional to their statutory audit
duties where the auditor’s expertise and experience with the Company and/or the Group are important.
Details of the amounts paid or payable to the auditor (Bentleys Audit and Corporate (WA) Pty Ltd) for
audit and non-audit services provided during the year are set out in note 19. During the year ended
30 June 2016 no fees were paid or were payable for non-audit services provided by the auditor of the
consolidated entity (2015: $Nil).
auDitor’s inDepenDenCe DeCLaration
The copy of the auditor’s independence declaration as required under section 307C of the Corporations
Act 2001 is set out on the next page.
Signed in accordance with a resolution of the Directors
p unsworth
Chairman
Perth, 28 September 2016
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 49
To The Board of Directors
Auditor’s Independence Declaration under Section 307C of the
Corporations Act 2001
As lead audit director for the audit of the financial statements of Impact Minerals Limited
for the financial year ended 30 June 2016, I declare that to the best of my knowledge
and belief, there have been no contraventions of:
the auditor independence requirements of the Corporations Act 2001 in relation to
the audit; and
any applicable code of professional conduct in relation to the audit.
Yours faithfully
BENTLEYS
Chartered Accountants
MARK DELAURENTIS CA
Director
Dated at Perth this 28th day of September 2016
CONsOLiDATED sTATEmENT Of PROfiT OR LOss
AND OThER COmPREhENsivE iNCOmE fOR yEAR ENDED 30 JUNE 2016
Interest income
Other income
Corporate and administration expense
Depreciation expense
Employee benefits expense
Impairment of exploration expenditure
Occupancy expense
Financing costs
Loss on disposal of controlled entities
Loss from continuing operations before income tax
Income tax expense
Loss after income tax for the period attributable to the
owners of impact minerals Limited
notes
3 (a)
3 (a)
3 (b)
10
14
27
5
Consolidated
2016
$
2015
$
49,804
14,967
1,212,888
1,188,833
(937,224)
(699,333)
(1,535)
(4,075)
(875,402)
(532,786)
(186,489)
(4,316,428)
(58,742)
(119,055)
(181,035)
–
–
(289,698)
(977,735)
(4,757,575)
–
–
(977,735)
(4,757,575)
other comprehensive income
Items that may be reclassified to profit or loss
Exchange differences on translating foreign controlled entities
other comprehensive income for the period, net of tax
16,234
16,234
432,939
432,939
total comprehensive loss for the period attributable to
the owners of impact minerals Limited
(961,501)
(4,324,636)
Cents
Cents
per share
per share
Loss per share attributable to the owners of impact
minerals Limited
– basic loss per share
18
0.15
0.85
This Consolidated Statement of Profit or Loss and Other Comprehensive Income
should be read in conjunction with the accompanying notes
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 51
CONsOLiDATED sTATEmENT Of fiNANCiAL POsiTiON
As AT 30 JUNE 2016
assets
Current assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Consolidated
notes
2016
$
2015
$
6
7
8, 14
3,929,972
70,279
201,457
571,981
84,016
–
total Current assets
4,201,708
655,997
non-Current assets
Property, plant and equipment
Exploration expenditure
Other non-current assets
9
10
2,435
2,978
9,749,914
6,526,545
11, 14
277,349
32,849
total non-Current assets
10,029,698
6,562,373
totaL assets
14,231,406
7,218,370
LiaBiLities
Current Liabilities
Trade and other payables
Short-term provisions
Financial liabilities
total Current Liabilities
totaL LiaBiLities
net assets
eQuity
Issued capital
Option reserve
Foreign currency translation reserve
Transactions with non-controlling interest
Accumulated losses
12
13
14
15
16
16
16
17
463,122
78,345
2,000,000
153,826
131,726
–
2,541,467
285,552
2,541,467
285,552
11,689,939
6,932,818
35,950,384
31,245,003
1,222,765
(504,602)
736,506
(520,836)
(1,161,069)
(1,161,069)
(23,817,539)
(23,366,786)
totaL eQuity
11,689,939
6,932,818
This Consolidated Statement of Financial Position should be
read in conjunction with the accompanying notes
Page 52 | IMPACT MINERALS LTD ANNUAL REPORT 2016
CONsOLiDATED sTATEmENT Of ChANGEs iN EQUiTy
fOR yEAR ENDED 30 JUNE 2016
attributable to the owners of impact minerals Limited
issued
Capital
$
option
reserves
$
foreign
currency
translation
reserve
$
trans-
actions
with non-
controlling
interest
$
accum-
ulated
losses
$
total equity
$
at 1 July 2014
28,653,052
635,288
(953,775)
(1,161,069) (18,609,211) 8,564,285
Total comprehensive
loss for the period
other
comprehensive
income
Exchange differences
on translating foreign
controlled entities
total comprehensive
loss for the period
net of tax
transactions with
owners in their
capacity as owners
Shares issued
Share issue costs
Fair value of options
issued
–
–
–
2,606,726
(14,775)
–
–
–
–
–
–
101,218
–
–
(4,757,575)
(4,757,575)
432,939
432,939
–
–
–
–
–
–
–
–
–
432,939
(4,757,575)
(4,324,636)
–
–
–
2,606,726
(14,775)
101,218
at 30 June 2015
31,245,003
736,506
(520,836)
(1,161,069) (23,366,786) 6,932,818
This Consolidated Statement of Changes in Equity should be
read in conjunction with the accompanying notes
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 53
CONsOLiDATED sTATEmENT Of ChANGEs iN EQUiTy
fOR yEAR ENDED 30 JUNE 2016 (CONTiNUED)
attributable to the owners of impact minerals Limited
issued
Capital
$
option
reserves
$
foreign
currency
translation
reserve
$
trans-
actions
with non-
controlling
interest
$
accum-
ulated
losses
$
total equity
$
at 1 July 2015
31,245,003
736,506
(520,836)
(1,161,069) (23,366,786) 6,932,818
Total comprehensive
loss for the period
other
comprehensive
income
Exchange differences
on translating foreign
controlled entities
total comprehensive
loss for the period
net of tax
transactions with
owners in their
capacity as owners
Shares issued
Share issue costs
Fair value of options
issued
Fair value of options
expired
–
–
–
4,911,631
(206,250)
–
–
–
–
–
–
–
1,013,241
(526,982)
–
–
(977,735)
(977,735)
16,234
16,234
–
–
–
–
–
–
–
–
–
–
–
16,234
(977,735)
(961,501)
–
–
–
4,911,631
(206,250)
1,013,241
526,982
–
at 30 June 2016
35,950,384
1,222,765
(504,602)
(1,161,069) (23,817,539) 11,689,939
This Consolidated Statement of Changes in Equity should be
read in conjunction with the accompanying notes
Page 54 | IMPACT MINERALS LTD ANNUAL REPORT 2016
CONsOLiDATED sTATEmENT Of CAsh fLOws
fOR yEAR ENDED 30 JUNE 2016
Cash flows from operating activities
Payments to suppliers and employees
Interest received
Research and development tax rebate received
net cash flows from/(used in)
operating activities
Cash flows from investing activities
Payments for property, plant and equipment
Proceeds from sale of property, plant and equipment
Payments for exploration activities
net cash flows from/(used in)
investing activities
Cash flows from financing activities
Proceeds from issue of shares
Share issue costs
Proceeds from borrowings
net cash flows from/(used in)
financing activities
Consolidated
notes
2016
$
2015
$
(1,429,291)
(1,238,570)
49,804
14,967
1,205,223
1,188,833
25
(174,264)
(34,770)
(1,000)
7
–
–
(3,165,883)
(2,717,359)
(3,166,876)
(2,717,359)
4,900,381
2,587,976
(201,250)
(14,775)
2,000,000
–
6,699,131
2,573,201
Net increase / (decrease) in cash and cash equivalents
3,357,991
(178,928)
Cash and cash equivalents
at beginning of period
Cash and cash equivalents
at end of period
571,981
750,909
6
3,929,972
571,981
This Consolidated Statement of Cash Flows should be
read in conjunction with the accompanying notes
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 55
NOTEs TO ThE CONsOLiDATED fiNANCiAL sTATEmENTs
fOR ThE yEAR ENDED 30 JUNE 2016
1. Corporate information
The consolidated financial report of Impact Minerals Limited for the year ended 30 June 2016 was
authorised for issue in accordance with a resolution of the Directors on 28 September 2016.
Impact Minerals Limited is a for profit company incorporated in Australia and limited by shares which
are publicly traded on the Australian Securities Exchange. The nature of the operation and principal
activities of the consolidated entity are described in the attached Directors’ Report.
The principal accounting policies adopted in the preparation of these consolidated financial statements
are set out below and have been applied consistently to all periods presented in the consolidated
financial statements and by all entities in the consolidated entity.
2. statement of CompLianCe
These general purpose financial statements have been prepared in accordance with Australian
Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards
Board, Urgent Issues Group Interpretations and the Corporations Act 2001.
Compliance with IFRS
The consolidated financial statements of Impact Minerals Limited also comply with International
Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
New and amended accounting standards and interpretations adopted by the Group
The following standard relevant to the operations of the Group and effective from 1 July 2015 has been
adopted. The adoption of this standard did not have any impact on the current period or any prior
period and is not likely to affect future periods.
• AASB 2015-3: Amendments to Australian Accounting Standards arising from the Withdrawal of
AASB 1031: Materiality
New accounting standards and interpretations
The following new and amended accounting standards and interpretations relevant to the operations
of the Group have been published but are not mandatory for the current financial year. The Group has
decided against early adoption of these standards, and has not yet determined the potential impact on
the financial statements from the adoption of these standards and interpretations.
application
date of
standard
application
date for
Group
1 Jan 2018
1 Jul 2018
new or revised requirement
AASB 9: Financial Instruments
AASB 9 replaces AASB 139: Financial Instruments: Recognition and
Measurement.
The objective of this Standard is to establish principles for the financial
reporting of financial assets and financial liabilities that will present
relevant and useful information to users of financial statements for their
assessment of the amounts, timing and uncertainty of an entity’s future
cash flows.
AASB 2014-3: Amendments to Australian Accounting Standards –
Accounting for Acquisitions of Interests in Joint Operations
1 Jan 2016
1 Jul 2016
AASB 2014-3 amends AASB 11 Joint Arrangements to provide guidance
on the accounting for acquisitions of interests in joint operations in which
the activity constitutes a business.
Page 56 | IMPACT MINERALS LTD ANNUAL REPORT 2016
2. statement of CompLianCe (ContinueD)
new or revised requirement
AASB 2014-4: Amendments to Australian Accounting Standards –
Clarification of Acceptable Methods of Depreciation and Amortisation
This Standard makes amendments to AASB 116: Property, Plant and
Equipment and AASB 138: Intangible Assets to establish the principle for
the basis of depreciation and amortisation as being the expected pattern
of consumption of the future economic benefits of an asset.
application
date of
standard
application
date for
Group
1 Jan 2016
1 Jul 2016
AASB 15: Revenue from Contracts with Customers
1 Jan 2018
1 Jul 2018
The objective of this Standard is to establish the principles that an entity
shall apply to report useful information to users of financial statements
about the nature, amount, timing and uncertainty of revenue and cash
flows arising from a contract with a customer.
AASB 2014-9: Amendments to Australian Accounting Standards – Equity
Method in Separate Financial Statements
1 Jan 2016
1 Jul 2016
This Standard amends AASB 127: Separate Financial Statements, and
consequentially AASB 1: First-time Adoption of Australian Accounting
Standards and AASB 128: Investments in Associates and Joint Ventures,
to allow entities to use the equity method of accounting for investments
in subsidiaries, joint ventures and associates in their separate financial
statements.
AASB 2014-10: Amendments to Australian Accounting Standards – Sale
or Contribution of Assets between an Investor and its Associate or Joint
Venture
This Standard amends AASB 10: Consolidated Financial Statements
and AASB 128: Investments in Associates and Joint Ventures to address
an inconsistency between the requirements in AASB 10 and those in
AASB 128 (August 2011), in dealing with the sale or contribution of assets
between an investor and its associate or joint venture.
1 Jan 2018
1 Jul 2018
AASB 2015-1: Amendments to Australian Accounting Standards – Annual
Improvements to Australian Accounting Standards 2012 – 2014 Cycle
1 Jan 2016
1 Jul 2016
This Standard makes non-urgent but necessary amendments to a
number of Australian Accounting Standards arising from the issuance of
International Financial Reporting Standard Annual Improvements to IFRSs
2012 – 2014 Cycle in September 2014 by the International Accounting
Standards Board.
AASB 2015-2: Amendments to Australian Accounting Standards –
Disclosure Initiative: Amendments to AASB 101
1 Jan 2016
1 Jul 2016
This Standard makes amendments to AASB 101: Presentation of
Financial Statements arising from International Accounting Standards
Board, Disclosure Initiative project. The amendments are designed to
encourage companies to apply professional judgement in determining
what information to disclose in the financial statements.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 57
2. statement of CompLianCe (ContinueD)
new or revised requirement
AASB 16: Leases
This Standard sets out the principles for the recognition, measurement,
presentation and disclosure of leases. The objective is to ensure that
lessees and lessors provide relevant information in a manner that faithfully
represents those transactions. This information gives a basis for users of
financial statements to assess the effect that leases have on the financial
position, financial performance and cash flows of an entity.
application
date of
standard
application
date for
Group
1 Jan 2019
1 Jul 2019
2016-1: Amendments to Australian Accounting Standards – Recognition
of Deferred Tax Assets for Unrealised Losses
1 Jan 2017
1 Jul 2017
This Standard makes amendments to AASB 112: Income Taxes
(July 2004) and AASB 112: Income Taxes (August 2015) to clarify the
requirements on recognition of deferred tax assets for unrealised losses
on debt instruments measured at fair value.
2016-2: Amendments to Australian Accounting Standards – Disclosure
Initiative: Amendments to AASB 107
1 Jan 2017
1 Jul 2017
This Standard amends AASB 107: Statement of Cash Flows (August
2015) to require entities preparing financial statements in accordance
with Tier 1 reporting requirements to provide disclosures that enable
users of financial statements to evaluate changes in liabilities arising from
financing activities, including both changes arising from cash flows and
non-cash changes.
(a) Basis of measurement
Historical Cost Convention
These consolidated financial statements have been prepared under the historical cost convention,
except where stated.
Critical Accounting Estimates
The preparation of financial statements requires the use of certain critical accounting estimates.
It also requires management to exercise its judgement in the process of applying the Group’s
accounting policies. The areas involving a higher degree of judgement or complexity, or areas
where assumptions and estimates are significant to the financial statements, are disclosed where
appropriate.
(b) Going Concern
These consolidated financial statements have been prepared on the going concern basis, which
contemplates continuity of normal business activities and the realisation of assets and the
settlement of liabilities in the ordinary course of business.
Page 58 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 2. statement of CompLianCe (ContinueD)
(c) principles of consolidation
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of
the Company as at 30 June 2016 and the results of all subsidiaries for the year then ended. The
Company and its subsidiaries together are referred to in this financial report as the Group or the
consolidated entity.
Subsidiaries are all entities (including structured entities) over which the Group has control. The
Group controls an entity when the Group is exposed to, or has rights to, variable returns from its
investment with the entity and has the ability to affect those returns through its power to direct the
activities of the entity.
The acquisition method of accounting is used to account for business combinations by the Group.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They
are de-consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between Group
companies are eliminated. Unrealised losses are also eliminated unless the transaction provides
evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been
changed where necessary to ensure consistency with the policies adopted by the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the
consolidated statement of profit or loss and other comprehensive income, consolidated statement
of financial position and the consolidated statement of changes in equity respectively.
Joint arrangements
Under AASB 11: Joint Arrangements investments in joint arrangements are classified as either joint
operations or joint ventures. The classification depends on the contractual rights and obligations
of each investor, rather than the legal structure of the joint arrangement.
A joint operation is a joint arrangement whereby the parties that have joint control of the
arrangement have rights to the assets, and obligations for the liabilities, relating to the
arrangement. Those parties are called joint operators. A joint venture is a joint arrangement
whereby the parties that have joint control of the arrangement have rights to the net assets of the
arrangement. Those parties are called joint venturers.
(d) Critical accounting judgements and key sources of estimation uncertainty
The application of accounting policies requires the use of judgments, estimates and assumptions
about carrying values of assets and liabilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical experience and other factors that
are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are
recognised in the period in which the estimate is revised if it affects only that period, or in the
period of the revision and future periods if the revision affects both current and future periods.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to
the fair value of the equity instruments at the date at which they are granted. The fair value is
determined using a Black-Scholes option pricing model.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 59
2. statement of CompLianCe (ContinueD)
Exploration and evaluation costs carried forward
The recoverability of the carrying amount of exploration and evaluation costs carried forward
has been reviewed by the Directors. In conducting the review, after impairment indicators are
identified, the recoverable amount has been assessed by reference to the higher of “fair value less
costs to sell” and, if applicable, “value in use”.
In determining value in use, future cash flows are based on estimates of ore reserves and mineral
resources for which there is a high degree of confidence of economic extraction, production and
sales levels, future commodity prices, future capital and production costs and future exchange
rates.
Variations to any of these estimates, and timing thereof, could result in significant changes to the
expected future cash flows which in turn could result in significant changes to the impairment test
results, which in turn could impact future financial results.
(e) segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to
the chief operating decision maker. The chief operating decision maker, who is responsible for
allocating resources and assessing performance of the operating segments, has been identified as
the Board of Directors of Impact Minerals Limited.
(f) functional and presentation of currency
The consolidated financial statements are presented in Australian dollars, which is the Group’s
functional and presentational currency.
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year end exchange rates of monetary
assets and liabilities denominated in foreign currencies are recognised in profit or loss, except
when they are deferred in equity as qualifying cash flow hedges and qualifying net investment
hedges or are attributable to part of the net investment in a foreign operation.
Foreign exchange gains and losses that relate to borrowings are presented in the statement of
profit or loss and other comprehensive income, within finance costs. All other foreign exchange
gains and losses are presented in the statement of profit or loss and other comprehensive income
on a net basis within other income or other expenses.
Non-monetary items that are measured at fair value in a foreign currency are translated using the
exchange rates at the date when the fair value was determined. Translation differences on assets
and liabilities carried at fair value are reported as part of the fair value gain or loss.
(g) revenue recognition
Revenue is measured at fair value of the consideration received or receivable. Amounts disclosed
as revenue are net of returns, trade allowances, rebates and amounts collected on behalf of third
parties. Interest income is recognised as it accrues.
(h)
income tax
The income tax expense or benefit for the period is the tax payable on the current period’s taxable
income based on the applicable income tax rate for each jurisdiction adjusted by changes in
deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.
Page 60 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 2. statement of CompLianCe (ContinueD)
The current income tax charge is calculated on the basis of the tax laws enacted or substantively
enacted at the end of the reporting period. Management periodically evaluates positions taken in
tax returns with respect to situations in which applicable tax regulation is subject to interpretation.
It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax
authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising
between the tax bases of assets and liabilities and their carrying amounts in the consolidated
financial statements. However, deferred tax liabilities are not recognised if they arise from the
initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from initial
recognition of an asset or liability in a transaction other than a business combination that at the
time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is
determined using tax rates (and laws) that have been enacted or substantially enacted by the end
of the reporting period and are expected to apply when the related deferred income tax asset is
realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses
only if it is probable that future taxable amounts will be available to utilise those temporary
differences and losses.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset
current tax assets and liabilities and when the deferred tax balances relate to the same taxation
authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable
right to offset and intends either to settle on a net basis, or to realise the asset and settle the
liability simultaneously.
Impact Minerals Limited and its wholly-owned Australian controlled entities 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, respectively.
(i) Leases
Leases of property, plant and equipment where the Group, as lessee, has substantially all the
risks and rewards of ownership are classified as finance leases. Finance leases are capitalised
at the lease’s inception at the fair value of the leased property or, if lower, the present value of
the minimum lease payments. The corresponding rental obligations, net of finance charges, are
included in other short-term and long-term payables.
Each lease payment is allocated between the liability and finance cost. The finance cost is charged
to the profit or loss over the lease period so as to produce a constant periodic rate of interest
on the remaining balance of the liability for each period. The property, plant and equipment
acquired under finance leases is depreciated over the asset’s useful life or over the shorter of the
asset’s useful life and the lease term if there is no reasonable certainty that the Group will obtain
ownership at the end of the lease term.
Leases in which a significant portion of the risks and rewards of ownership are not transferred to
the Group as lessee are classified as operating leases. Payments made under operating leases
(net of any incentives received from the lessor) are charged to profit or loss on a straight-line basis
over the period of the lease.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 61
2. statement of CompLianCe (ContinueD)
(j)
impairment of assets
Intangible assets that have an indefinite useful life are not subject to amortisation and are tested
annually for impairment or more frequently if events or changes in circumstances indicate that
they might be impaired. Other assets are tested for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. An impairment loss is
recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For
the purposes of assessing impairment, assets are grouped at the lowest levels for which there are
separately identifiable cash inflows which are largely independent of the cash inflows from other
assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that
suffered an impairment are reviewed for possible reversal of the impairment at the end of each
reporting period.
(k) Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions,
other short-term, highly liquid investments with original maturities of six 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. Bank overdrafts are shown within borrowings in current
liabilities on the statement of financial position.
(l) trade and other receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised
cost using the effective interest method, less provision for impairment. Trade receivables are
due for settlement within 30 days. They are presented as current assets unless collection is not
expected for more than 12 months after the reporting date.
Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to
be uncollectible are written off by reducing the carrying amount directly. A provision for doubtful
receivables is established when there is objective evidence that the Group will not be able to
collect all amounts due according to the original terms of the receivables. The amount of the
provision is the difference between the asset’s carrying amount and the present value of estimated
future cash flows, discounted at the original effective interest rate.
Cash flows relating to short-term receivables are not discounted if the effect of discounting is
immaterial. The amount of the provision is recognised in the profit or loss.
(m) exploration and evaluation expenditure
Exploration and evaluation expenditure, including the costs of acquiring licences and permits, are
capitalised as exploration and evaluation assets on an area of interest basis. Costs incurred before
the Group has obtained the legal rights to explore an area are recognised in the statement of profit
or loss and other comprehensive income.
Exploration and evaluation assets are only recognised if the rights of the area of interest are
current and either:
(i) the expenditures are expected to be recouped through successful development and
exploitation or from sale of the area of interest; or
(ii) activities in the area of interest have not at the reporting date reached a stage which permits
a reasonable assessment of the existence or otherwise of economically recoverable reserves,
and active and significant operations in, or in relation to, the area of interest are continuing.
Page 62 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 2. statement of CompLianCe (ContinueD)
Exploration and evaluation assets are assessed for impairment if sufficient data exists to determine
technical feasibility and commercial viability, and facts and circumstances suggest that the
carrying amount exceeds the recoverable amount. For the purposes of impairment testing,
exploration and evaluation assets are allocated to cash-generating units to which the exploration
activity relates. The cash generating unit shall not be larger than the area of interest.
Once the technical feasibility and commercial viability of the extraction of minerals in an area of
interest are demonstrable, exploration and evaluation assets attributable to that area of interest are
first tested for impairment and then reclassified to mineral property and development assets within
property, plant and equipment.
When an area of interest is abandoned or the Directors decide that it is not commercial, any
accumulated costs in respect of that area are written off in the financial period the decision is made.
(n) property, plant and equipment
Property, plant and equipment is stated at historical cost less accumulated depreciation. Historical
cost includes expenditure that is directly attributable to the acquisition of the items. The cost of
self-constructed assets includes the cost of materials, direct labour, the initial estimate, where
relevant, of the costs of dismantling and removing the items and restoring the site on which they
are located, and an appropriate proportion of production overheads.
Where parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items of property, plant and equipment.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset,
as appropriate, only when it is probable that future economic benefits associated with the item
will flow to the Group and the cost of the item can be measured reliably. The carrying amount
of any component accounted for as a separate asset is derecognised when replaced. All other
repairs and maintenance are charged to profit or loss during the reporting period in which they are
incurred.
Depreciation is calculated using the straight-line method to allocate their cost, net of their residual
values, over their estimated useful lives, or in the case of certain leased plant and equipment, the
shorter lease term as follows:
• Motor vehicles
• Office and computer equipment
• Furniture, fittings and equipment
5 – 7 years
3 – 5 years
3 – 5 years
The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of
each reporting period.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s
carrying amount is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount.
These are included in profit or loss. When re-valued assets are sold, it is Group policy to transfer
any amounts included in other reserves in respect of those assets to retained earnings.
(o) trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the
end of the financial year and which are unpaid. The amounts are unsecured and are usually paid
within 30 days of recognition. Trade and other payables are presented as current liabilities unless
payment is not due within 12 months from the reporting date.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 63
2. statement of CompLianCe (ContinueD)
(p) employee benefits
Short–term Obligations
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating
sick leave expected to be settled within 12 months after the end of the period in which the
employees render the related service, are recognised in respect of employees’ services up to
the end of the reporting period and are measured at the amounts expected to be paid when the
liabilities are settled. The liability for annual leave and accumulating sick leave is recognised in
the provision for employee benefits. Liabilities for non-accumulating sick leave are recognised
when the leave is taken and measured at the rates paid or payable. All other short-term employee
benefit obligations are presented as payables.
The obligations are presented as current liabilities in the statement of financial position if the
entity does not have an unconditional right to defer settlement for at least twelve months after the
reporting date, regardless of when the actual settlement is expected to occur.
Other Long-term Obligations
The liability for long service leave and annual leave which is not expected to be settled within
12 months after the end of the period in which the employees render the related service is
recognised in the provision for employee benefits and measured as the present value of expected
future payments to be made in respect of services provided by employees up to the end of the
reporting period using the projected unit credit method. Consideration is given to expected future
wage and salary levels, experience of employee departures and periods of service. Expected
future payments are discounted using market yields at the end of the reporting period on national
government bonds with terms to maturity and currency that match, as closely as possible, the
estimated future cash outflows.
Share-Based Payments
The Group provides benefits to employees of the Company in the form of share options. The fair
value of options granted is recognised as an employee benefits expense with a corresponding
increase in equity. The fair value is measured at grant date and spread over the period during
which the employees become unconditionally entitled to the options. The fair value of the options
granted is measured using a Black-Scholes option pricing model, taking into account the terms
and conditions upon which the options were granted.
The cost of equity-settled transactions is recognised, together with a corresponding increase in
equity, on a straight line basis over the vesting period. The amount recognised as an expense is
adjusted to reflect the actual number that vest.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the
computation of earnings per share.
Termination Benefits
Termination benefits are payable when employment is terminated before the normal retirement
date, or when an employee accepts voluntary redundancy in exchange for these benefits. The
Group recognises termination benefits when it is demonstrably committed to either terminating
the employment of current employees according to a detailed formal plan without possibility of
withdrawal or providing termination benefits as a result of an offer made to encourage voluntary
redundancy. Benefits falling due more than 12 months after the end of the reporting period
are discounted to present value. No termination benefits, other than accrued benefits and
entitlements, were paid during the period.
Page 64 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 2. statement of CompLianCe (ContinueD)
(q) equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction, net of tax, from the proceeds.
(r) earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing:
•
the profit attributable to owners of the Group, excluding any costs of servicing equity other than
ordinary shares
• by the weighted average number of ordinary shares outstanding during the financial year, adjusted
for bonus elements in ordinary shares issued during the year and excluding treasury shares.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per
share to take into account:
•
the after income tax effect of interest and other financing costs associated with dilutive
potential ordinary shares, and
the weighted average number of additional ordinary shares that would have been outstanding
assuming the conversion of all dilutive potential ordinary shares.
•
(s) Goods and services tax (Gst)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the
GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of
the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The
net amount of GST recoverable from, or payable to, the taxation authority is included with other
receivables or payables in the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from
investing or financing activities which are recoverable from, or payable to the taxation authority, are
presented as operating cash flows.
(t) financial instruments
Initial Recognition and Measurement
Financial instruments, including financial assets and financial liabilities, are recognised when the
Consolidated Group becomes a party to the contractual provisions of the instrument. Trade date
accounting is adopted for financial assets that are delivered within timeframes established by
marketplace convention.
Financial instruments are initially measured at fair value plus transaction costs where the
instrument is not classified as at fair value through profit or loss. Transaction costs related
to instruments classified as at fair value through profit or loss are expensed to profit or loss
immediately. Financial instruments are classified and measured as set out below.
Fair value is determined based on current bid prices for all quoted investments. Valuation
techniques are applied to determine the fair value for all unlisted securities, including recent arm’s
length transactions, reference to similar instruments and option pricing models.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 65
2. statement of CompLianCe (ContinueD)
Classification and Subsequent Measurement
Finance instruments are subsequently measured at either of fair value, amortised cost using the
effective interest rate method, or cost. Fair value represents the amount for which an asset could
be exchanged or a liability settled, between knowledgeable, willing parties. Where available,
quoted prices in an active market are used to determine fair value. In other circumstances,
valuation techniques are adopted.
Amortised cost is the amount at which the financial asset or financial liability is measured at initial
recognition less principal repayments and any reduction for impairment, and adjusted for any
cumulative amortisation of the difference between that initial amount and the maturity amount
calculated using the effective interest method.
Fair value is determined based on current bid prices for all quoted investments. Valuation
techniques are applied to determine the fair value for all unlisted securities, including recent arm’s
length transactions, reference to similar instruments and option pricing models.
The effective interest method is used to allocate interest income or interest expense over the
relevant period and is equivalent to the rate that exactly discounts estimated future cash payments
or receipts (including fees, transaction costs and other premiums or discounts) through the
expected life (or when this cannot be reliably predicted, the contractual term) of the financial
instrument to the net carrying amount of the financial asset or financial liability. Revisions to
expected future net cash flows will necessitate an adjustment to the carrying value with a
consequential recognition of an income or expense in profit or loss.
The Consolidated Group does not designate any interests in subsidiaries, associates or joint
venture entities as being subject to the requirements of Accounting Standards specifically
applicable to financial instruments.
(i) Financial assets at fair value through profit or loss
Financial assets are classified at “fair value through profit or loss” when they are held for
trading for the purpose of short term profit taking, where they are derivatives not held for
hedging purposes, or designated as such to avoid an accounting mismatch or to enable
performance evaluation where a group of financial assets is managed by key management
personnel on a fair value basis in accordance with a documented risk management or
investment strategy. Realised and unrealised gains and losses arising from changes in fair
value are included in profit or loss in the period in which they arise.
(ii) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments
that are not quoted in an active market and are subsequently measured at amortised cost using
the effective interest rate method. Loans and receivables are included in current assets except
those which are expected to mature within 12 months after the end of the reporting period.
(iii) Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets that have fixed maturities and
fixed or determinable payments, and it is the Consolidated Group‘s intention to hold these
investments to maturity. They are subsequently measured at amortised cost using the effective
interest rate method. Held to maturity investments are included in non-current assets where
they are expected to mature within 12 months after the end of the reporting period. All other
investments are classified as current assets.
Page 66 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016
2. statement of CompLianCe (ContinueD)
(iv) Available-for-sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are either designated
as such or that are not classified in any of the other categories. They comprise investments
in the equity of other entities where there is neither a fixed maturity nor fixed or determinable
payments.
They are subsequently measured at fair value with changes in such fair value (i.e. gains or
losses) recognised in other comprehensive income (except for impairment losses and foreign
exchange gains and losses). When the financial asset is derecognised, the cumulative gain
or loss pertaining to that asset previously recognised in other comprehensive income is
reclassified into profit or loss.
Available for sale financial assets are included in non-current assets except those which are
expected to mature within 12 months after the end of the reporting period. All other financial
assets are classified as current assets.
(v) Financial Liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured
at amortised cost using the effective interest rate method.
Impairment
At the end of each reporting period, the Consolidated Group assesses whether there is objective
evidence that a financial instrument has been impaired. In the case of available-for-sale financial
instruments, a prolonged decline in the value of the instrument is considered to determine whether
impairment has arisen. Impairment losses are recognised in the profit or loss. Also, any cumulative
decline in Fair Value previously recognised in other comprehensive income is reclassified to profit
or loss at this point.
Derecognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expire
or the asset is transferred to another party whereby the entity no longer has any significant
continuing involvement in the risks and benefits associated with the asset. Financial liabilities
are derecognised where the related obligations are either discharged, cancelled or expire. The
difference between the carrying value of the financial liability extinguished or transferred to another
party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities
assumed, is recognised in profit or loss.
Financial Guarantees
Where material, financial guarantees issued, which require the issuer to make specified payments
to reimburse the holder for a loss it incurs because a specified debtor fails to make payment when
due, are recognised as a financial liability at fair value on initial recognition.
The guarantee is subsequently measured at the higher of the best estimate of the obligation and
the amount initially recognised less, when appropriate, cumulative amortisation in accordance
with AASB 118: Revenue. Where the entity gives guarantees in exchange for a fee, revenue is
recognised under AASB 118.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 67
2. statement of CompLianCe (ContinueD)
The fair value of financial guarantee contracts has been assessed using a probability weighted
discounted cash flow approach. The probability has been based on:
the likelihood of the guaranteed party defaulting in a year period;
•
the proportion of the exposure that is not expected to be recovered due to the guaranteed
•
party defaulting; and
the maximum loss exposed if the guaranteed party were to default.
•
(u) fair value of assets and Liabilities
The Group measures some of its assets and liabilities at fair value on either a recurring or
nonrecurring basis, depending on the requirements of the applicable Accounting Standard.
Fair value is the price the Group would receive to sell an asset or would have to pay to transfer a
liability in an orderly (i.e. unforced) transaction between independent, knowledgeable and willing
market participants at the measurement date.
As fair value is a market-based measure, the closest equivalent observable market pricing
information is used to determine fair value. Adjustments to market values may be made having
regard to the characteristics of the specific asset or liability. The fair values of assets and liabilities
that are not traded in an active market are determined using one or more valuation techniques.
These valuation techniques maximise, to the extent possible, the use of observable market data.
To the extent possible, market information is extracted from either the principal market for the
asset or liability (i.e. the market with the greatest volume and level of activity for the asset or
liability) or, in the absence of such a market, the most advantageous market available to the entity
at the end of the reporting period (i.e. the market that maximises the receipts from the sale of the
asset or minimises the payments made to transfer the liability, after taking into account transaction
costs and transport costs).
For non-financial assets, the fair value measurement also takes into account a market participant’s
ability to use the asset in its highest and best use or to sell it to another market participant that
would use the asset in its highest and best use.
The fair value of liabilities and the entity’s own equity instruments (excluding those related to share-
based payment arrangements) may be valued, where there is no observable market price in relation to
the transfer of such financial instruments, by reference to observable market information where such
instruments are held as assets. Where this information is not available, other valuation techniques are
adopted and, where significant, are detailed in the respective note to the financial statements.
Valuation techniques
In the absence of an active market for an identical asset or liability, the Group selects and uses
one or more valuation techniques to measure the fair value of the asset or liability, The Group
selects a valuation technique that is appropriate in the circumstances and for which sufficient data
is available to measure fair value. The availability of sufficient and relevant data primarily depends
on the specific characteristics of the asset or liability being measured. The valuation techniques
selected by the Group are consistent with one or more of the following valuation approaches:
Market approach: valuation techniques that use prices and other relevant information generated by
market transactions for identical or similar assets or liabilities.
Income approach: valuation techniques that convert estimated future cash flows or income and
expenses into a single discounted present value.
Page 68 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 2. statement of CompLianCe (ContinueD)
Cost approach: valuation techniques that reflect the current replacement cost of an asset at its
current service capacity.
Each valuation technique requires inputs that reflect the assumptions that buyers and sellers
would use when pricing the asset or liability, including assumptions about risks. When selecting
a valuation technique, the Group gives priority to those techniques that maximise the use of
observable inputs and minimise the use of unobservable inputs. Inputs that are developed
using market data (such as publicly available information on actual transactions) and reflect the
assumptions that buyers and sellers would generally use when pricing the asset or liability are
considered observable, whereas inputs for which market data is not available and therefore
are developed using the best information available about such assumptions are considered
unobservable.
Fair value hierarchy
AASB 13 – Fair Value Measurement requires the disclosure of fair value information by level of the
fair value hierarchy, which categorises fair value measurements into one of three possible levels
based on the lowest level that an input that is significant to the measurement can be categorised
into as follows:
Level 1
Measurements based on quoted prices (unadjusted) in active markets for identical assets or
liabilities that the entity can access at the measurement date. Measurements based on inputs
other than quoted prices included in Level 1 that are observable for the asset or liability, either
directly or indirectly.
Level 2
Measurements based on inputs other than quoted prices included in Level 1 that are observable
for the asset or liability, either directly or indirectly.
Level 3
Measurements based on unobservable inputs for the asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined
using one or more valuation techniques. These valuation techniques maximise, to the extent
possible, the use of observable market data. If all significant inputs required to measure fair value
are observable, the asset or liability is included in Level 2. If one or more significant inputs are not
based on observable market data, the asset or liability is included in Level 3.
The Group would change the categorisation within the fair value hierarchy only in the following
circumstances:
(i) if a market that was previously considered active (Level 1) became inactive (Level 2 or Level 3)
or vice versa; or
(ii) if significant inputs that were previously unobservable (Level 3) became observable (Level 2) or
vice versa.
When a change in the categorisation occurs, the Group recognises transfers between levels of the
fair value hierarchy (i.e. transfers into and out of each level of the fair value hierarchy) on the date
the event or change in circumstances occurred.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 69
3. revenue anD expenses
(a) revenue from operating activities
Interest income
Other income
Research and development tax rebate
Consolidated
2016
$
2015
$
49,804
7,665
14,967
–
1,205,223
1,188,833
total revenue from operating activities
1,262,692
1,203,800
(b) employee benefits expense
Wages, salaries and other remuneration expenses
Directors fees
Superannuation fund contributions
Share-based payments expense
293,333
140,292
33,458
408,319
279,221
115,000
37,346
101,219
total employee benefits expense
875,402
532,786
4. seGment information
identification of reportable segments
The Consolidated Group has identified its operating segments based on the internal reports that
are reviewed and used by the Board of Directors (chief operating decision makers) in assessing
performance and determining the allocation of resources.
The Consolidated Group is managed primarily on the basis of exploration opportunities within Australia
and Africa. Operating segments are therefore determined on this basis.
Reportable segments disclosed are based on aggregating operating segments where the segments are
considered to have similar geographic characteristics.
Page 70 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 4. seGment information (ContinueD)
australia
$
africa
$
turkey
$
Corporate
$
Consolidated
$
2016
Segment performance
Segment income
Segment expense
–
186,489
7,665
141,214
Profit / (loss) before tax
(186,489)
(133,549)
Segment assets and
liabilities
Assets
Liabilities
net assets
9,749,914
255,589
9,494,325
30,964
9,283
21,681
–
–
–
–
–
–
1,255,027
1,262,692
1,912,724
2,240,427
(657,697)
(977,735)
4,450,528
14,231,406
2,276,595
2,541,467
2,173,933
11,689,939
2015
$
$
$
$
$
Segment performance
Segment income
Segment expense
Profit / (loss) before tax
Segment assets and
liabilities
Assets
Liabilities
net assets
–
255
(255)
29
–
1,203,771
1,203,800
199,575
289,698
5,471,847
5,961,375
(199,546)
(289,698)
(4,268,076)
(4,757,575)
6,526,545
32,525
6,494,020
31,821
373
31,448
–
–
–
660,004
252,654
7,218,370
285,552
407,350
6,932,818
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 71
5. inCome tax
(a) Major components of income tax expense are as follows:
Current income tax expense / (benefit)
Deferred income tax expense / (benefit)
income tax expense reported in the Consolidated s tatement
of profit or Loss and other Comprehensive income
Consolidated
2016
$
2015
$
–
–
–
–
–
–
(b) The prima facie tax on loss from ordinary activities before income
tax is reconciled to the income tax as follows:
Profit from ordinary activities before income tax expense
(977,735)
(4,757,575)
Prima facie tax benefit on profit from ordinary activities before
income tax at 30% (2015: 30%)
(293,321)
(1,427,273)
Tax effect of permanent differences:
Share based payments
Non-deductible expenses
Overs and unders from prior years
Unrecognised temporary differences:
Expenditure subject to research & development offset
Tax losses not recognised / (recognised)
Capital losses not recognised / (recognised)
Impairment of exploration expenditure
Government grant received
Foreign exploration expenditure
Foreign tax rate difference
income tax expense/(benefit) on pre-tax profit
(c) Deferred tax assets and (liabilities) are attributable to the following:
Accrued expenses
Capital raising costs
Exploration expenditure
Plant and equipment
Provision for employee entitlement
Other
Tax losses
Page 72 | IMPACT MINERALS LTD ANNUAL REPORT 2016
122,496
35,094
–
490,191
–
32,240
3,644
84,469
674,644
(384,916)
42,593
1,294,928
(361,166)
(355,505)
–
6,706
–
35,176
–
–
6,976
52,080
8,085
88,782
(2,843,856)
(1,957,964)
8,517
22,684
9,053
9,388
27,833
–
2,744,546
1,823,876
–
–
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 5. inCome tax (ContinueD)
(d) Unrecognised deferred tax assets
Deferred tax assets have not been recognised in respect of the
following items as the Directors do not believe it is appropriate to
regard realisation of future tax benefits as probable:
Tax losses
Capital losses
6. Cash anD Cash eQuivaLents
Cash at bank and on hand
Cash at bank – on call
Consolidated
2016
$
2015
$
3,698,096
4,079,479
711,150
–
4,409,246
4,079,479
3,929,972
–
30,443
541,538
3,929,972
571,981
The weighted average interest rate for the year was 1.95% (2015: 0.51%).
The Group’s exposure to interest rate risk is set out in note 23. The maximum exposure to credit risk
at the end of the reporting period is the carrying amount of each class of cash and cash equivalents
mentioned above.
7. traDe anD other reCeivaBLes
Current
Trade debtors and other receivables
GST / VAT
Other
–
68,071
2,208
80,887
–
3,129
70,279
84,016
The amounts held in trade and other receivables do not contain impaired assets and are not past due.
Based on the credit history of these trade and other receivables, it is expected that these amounts will
be received when due. The Group’s financial risk management objectives and policies are set out in
note 23.
Due to the short term nature of these receivables their carrying value is assumed to approximate their
fair value.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 73
8. other Current assets
Current portion of unamortised option cost
Consolidated
2016
$
2015
$
201,457
201,457
–
–
Refer to note 14 for details of the transaction costs related to the issue of options to Squadron
Resources Pty Ltd.
9. property, pLant anD eQuipment
Leasehold improvements
– At cost
– Accumulated depreciation
Total leasehold improvements
Office equipment
– At cost
– Accumulated depreciation
Total office equipment
Site equipment
– At cost
– Accumulated depreciation
Total site equipment
Motor vehicles
– At cost
– Accumulated depreciation
Total motor vehicles
Computer equipment
– At cost
– Accumulated depreciation
Total computer equipment
Total property, plant and equipment
Page 74 | IMPACT MINERALS LTD ANNUAL REPORT 2016
7,400
(5,872)
7,400
(5,133)
1,528
2,268
65,488
(65,488)
79,243
(79,225)
–
18
36,035
(35,128)
38,640
(38,640)
907
–
47,030
(47,030)
57,241
(57,241)
–
–
138,675
(138,675)
140,440
(139,748)
–
692
2,435
2,978
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 9. property, pLant anD eQuipment (ContinueD)
movement in carrying amounts
Movements in the carrying amounts for each class of property, plant and equipment between the
beginning and the end of the year:
Leasehold
improve-
ments
$
office
equipment
$
site
equipment
$
motor
vehicles
$
Computer
equipment
$
total
$
2,268
–
–
(740)
18
–
(8)
(10)
–
1,000
–
(93)
1,528
–
907
3,008
1,693
(740)
–
2,268
(1,675)
–
18
–
–
–
–
–
–
–
–
–
–
–
–
–
692
–
–
2,978
1,000
(8)
(692)
(1,535)
–
2,435
2,143
6,844
(1,451)
(3,866)
–
–
692
2,978
2016
Consolidated:
Balance at the
beginning of the
year
Additions
Disposals
Depreciation
expense
Carrying amount
at the end of the
year
2015
Consolidated:
Balance at the
beginning of the
year
Depreciation
expense
Disposals
Carrying amount
at the end of the
year
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 75
10. expLoration anD evaLuation
Opening balance
Impairment expense
Exploration expenditure incurred during the year
Carrying value of tenements sold (Turkey)
Consolidated
2016
$
2015
$
6,526,545
7,714,139
(186,489)
(4,316,428)
3,409,858
3,228,834
–
(100,000)
Closing balance
9,749,914
6,526,545
Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area
of interest. These costs are only carried forward to the extent that they are expected to be recouped
through the successful development of the area or where activities in the area have not yet reached a
stage that permits reasonable assessment of the existence of economically recoverable reserves.
Impairment of exploration expenditure incurred during the prior period relates to tenements held within
Botswana which were impaired based on issues and delays encountered in renewing the tenement
licences.
11. other non-Current assets
Non-current portion of unamortised option cost
Other non-current assets
222,430
54,919
–
32,849
277,349
32,849
Refer to note 14 for details of the transaction costs related to the issue of options to Squadron
Resources Pty Ltd.
12. traDe anD other payaBLes
Trade creditors
Other payables and accruals
347,980
115,142
115,069
38,757
463,122
153,826
Trade creditors are non-interest bearing and are normally settled on 30 day terms. The Group’s financial
risk management objectives and policies are set out in note 23. Due to the short term nature of these
payables their carrying value is assumed to approximate their fair value.
13. provisions
short-term
Employee entitlements
Page 76 | IMPACT MINERALS LTD ANNUAL REPORT 2016
78,345
131,726
78,345
131,726
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 14. finanCiaL LiaBiLities
Convertible notes
Consolidated
2016
$
2,000,000
2,000,000
2015
$
–
–
2,000,000 convertible notes were issued to Squadron Resources Pty Ltd on 7 August 2015 at an issue
price of $1 per note. Each note entitles the holder to convert to one ordinary share. The notes are
convertible in to ordinary shares of Impact at the lower of:
• 2.1 cents per share; and
• 80% of the volume weighted average sale price of shares sold on the ASX during the 30 consecutive
business days prior to the date of the conversion notice.
Conversion may occur at any time between 7 August 2015 and 7 August 2018. The convertible
notes do not carry interest and can only be redeemed through the issue of shares, except in remote
circumstances that are not at the discretion of the note holder.
Included in other assets are transaction costs relating to the convertible notes and represent the fair
value of the attaching 45,000,000 options issued which are convertible at 3.25 cents per option and
deemed to have a fair value of 1.34 cents per option. These transaction costs are amortised over the
life of the convertible notes.
transaction costs
Share based payment – options granted
Option cost unwound during the period
Total transactions costs to be amortised over the life of the convertible
note
This balance has been classified as follows:
Other current assets (refer note 8)
Other non-current assets (refer note 11)
604,922
(181,035)
423,887
201,457
222,430
423,887
–
–
–
–
–
–
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 77
15. ContriButeD eQuity
a) share capital
Ordinary shares fully paid
b) movements in ordinary shares on issue
Balance at 1 July 2014
Shares issued during the year:
Placement – July 2014
Shares issued to Directors in lieu of fees
Transaction costs
Consolidated
2016
$
2015
$
35,950,384
31,245,003
Consolidated
number
$
487,063,284
28,653,052
78,423,516
2,587,976
852,270
–
18,750
(14,775)
Balance at 30 June 2015
566,339,070
31,245,003
Shares issued during the year:
Shares issued to Directors in lieu of fees – July 2015
Rights issue and shortfall issue – September 2015
Issue of shares to Squadron Resources – October 2015
Share purchase plan – May 2016
Placements – May 2016
Transaction costs
284,090
6,250
94,437,193
1,983,181
47,619,048
1,000,000
45,166,683
1,084,000
34,925,001
838,200
–
(206,250)
Balance at 30 June 2016
788,771,085
35,950,384
Ordinary shares have the right to receive dividends as declared, and in the event of winding up
the Company, to participate in the proceeds from the sale of all surplus assets in proportion to the
number of and amounts paid upon on shares held.
Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
c) movements in options on issue
Balance at beginning of the financial year
42,150,000
42,150,000
Options granted
Options expired
Options cancelled / lapsed
134,428,572
(26,700,000)
(8,050,000)
–
–
–
Balance at end of the financial year
141,828,572
42,150,000
Page 78 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 16. reserves
option reserve
Opening balance
Fair value of options issued
Transfer to retained earnings upon lapse of options
Consolidated
2016
$
2015
$
736,506
1,013,241
(526,982)
635,288
101,218
–
Balance at the end of the financial year
1,222,765
736,506
The options reserve is used to recognise the fair value of options issued to employees, contractors and
the options issued to Squadron Resources Pty Ltd during the year.
foreign currency translation reserve
The foreign currency translation reserve records exchange differences arising on translation of a foreign
controlled subsidiary.
transactions with non-controlling interest
The transactions with non-controlling interest reserve records items related to the acquisition of shares
in Invictus Gold Limited.
17. aCCumuLateD Losses
Balance at the beginning of the financial year
Net loss attributable to members
Transfer from share option reserve upon lapse of options
(23,366,786)
(18,609,211)
(977,735)
(4,757,575)
526,982
–
Balance at the end of the financial year
(23,817,539)
(23,366,786)
18. earninGs per share
– basic loss per share
The following reflects the income and share data used in the calculation
of basic loss per share:
2016
cents
2015
cents
0.15
0.85
$
$
Profits / (losses) used in calculating basic and diluted earnings per share
(977,735)
(4,757,575)
Weighted average number of ordinary shares used in calculating basic
loss per share
671,145,118
562,954,441
2016
number
2015
number
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 79
19. auDitor’s remuneration
audit services
Bentleys Audit and Corporate (WA) Pty Ltd
– Audit and review of the financial reports
Total remuneration
Consolidated
2016
$
2015
$
33,000
29,000
33,000
29,000
20. ContinGent assets anD LiaBiLities
The Group had contingent liabilities at 30 June 2016 in respect of :
future royalty payments
In March 2016 Impact completed the acquisition of tenement E7390 from Golden Cross Resources Limited
(“Golden Cross”) for $60,000 cash. Golden Cross retains a royalty equal to 1% of gross revenue on any
minerals recovered from the tenement. At its election, Impact has the right to buy back the royalty for $1.5
million cash at any time up to a decision to mine, or, leave the royalty uncapped during production.
21. events oCCurrinG after the reportinG perioD
There have been no events subsequent to reporting date which are sufficiently material to warrant
disclosure.
22. Commitments
In order to maintain an interest in the exploration tenements in which the Group is involved, the Group
is committed to meet the conditions under which the tenements were granted. The timing and amount
of exploration expenditure commitments and obligations of the Group are subject to the minimum
expenditure commitments required as per the Mining Act 1978 (Western Australia), the Mining Act 1992
(New South Wales) and the Mineral Resources Act 199 (Queensland) and may vary significantly from
the forecast based upon the results of the work performed which will determine the prospectivity of the
relevant area of interest.
As at balance date, total exploration expenditure commitments on granted tenements held by the
Consolidated Group that have not been provided for in the financial statements and which cover the
following twelve month period amount to $682,594 (2015: $842,519). For the period greater than twelve
months to five years commitments amount to $621,397 (2015: $2,115,153). There are no commitments
greater than five years. These obligations are also subject to variations by farm-out arrangements, or
sale of the relevant tenements
Commitments in relation to the lease of office premises are payable as follows:
Within 1 year
Later than one year but not later than five years
Later than five years
Page 80 | IMPACT MINERALS LTD ANNUAL REPORT 2016
43,200
39,600
–
39,600
–
–
82,800
39,600
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 23. finanCiaL risK manaGement oBJeCtives anD poLiCies
financial risk management
Overview
The Group has exposure to the following risks from their use of financial instruments:
•
• Credit risk
• Liquidity risk
• Commodity risk
Interest rate risk
This note presents information about the Group’s exposure to each of the above risks, their objectives,
policies and processes for measuring and managing risk, and the management of capital.
The Board of Directors has overall responsibility for the establishment and oversight of the risk
management framework.
Risk management policies are established to identify and analyse the risks faced by the Group, to set
appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management
policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s
activities.
The Board oversees how management monitors compliance with the Group’s risk management policies
and procedures and reviews the adequacy of the risk management framework in relation to the risks
faced by the Group.
The Group’s principal financial instruments are cash, short-term deposits, receivables and payables.
Interest rate risk
Interest rate risk is the risk that the value of a financial instrument or cash flows associated with
the instrument will fluctuate due to changes in market interest rates. Interest rate risk arises from
fluctuations in interest bearing financial assets and liabilities that the Group uses.
Interest bearing assets comprise cash and cash equivalents which are considered to be short-term
liquid assets. It is the Group’s policy to settle trade payables within the credit terms allowed and
therefore not incur interest on overdue balances.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 81
23. finanCiaL risK manaGement oBJeCtives anD poLiCies
(ContinueD)
The following table set out the carrying amount, by maturity, of the financial instruments that are
exposed to interest rate risk:
floating
interest
rate
$
fixed interest rate
maturing in
1 year or
Less
$
over 1 to
5 years
$
more than
5 years
$
non
interest
bearing
$
total
$
Consolidated – 2016
financial assets
Cash and cash equivalents
3,929,972
Trade and other receivables
–
Weighted average interest
rate
financial liabilities
Trade and other payables
Financial liabilities
Weighted average interest
rate
3,929,972
1.95%
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
3,929,972
70,279
70,279
70,279
4,000,251
–
–
463,122
463,122
– 2,000,000 2,000,000
–
–
2,463,122
2,463,122
–
–
floating
interest
rate
$
fixed interest rate
maturing in
1 year or
Less
$
over 1 to
5 years
$
more than
5 years
$
non
interest
bearing
$
total
$
Consolidated – 2015
financial assets
Cash and cash equivalents
571,981
Trade and other receivables
–
Weighted average interest
rate
financial liabilities
Trade and other payables
Weighted average interest
rate
571,981
0.51%
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
571,981
84,016
84,016
84,016
655,997
–
–
153,826
153,826
153,826
153,826
–
–
Page 82 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 23. finanCiaL risK manaGement oBJeCtives anD poLiCies
(ContinueD)
Fair value sensitivity analysis for fixed rate instruments
The Group does not account for any fixed rate financial assets or liabilities at fair value through profit or
loss. Therefore, a change in interest rates at the reporting date would not affect profit or loss.
Cash flow sensitivity analysis for variable rate instruments
A change of 100 basis points in interest rates at the reporting date would have increased / (decreased)
equity and profit or loss by the amounts shown below:
Carrying
value at
period end
$
profit or loss
equity
100 bp
increase
$
100 bp
decrease
$
100 bp
increase
$
100 bp
decrease
$
3,929,972
25,533
(25,533)
25,533
(25,533)
Consolidated – 2016
financial assets
Cash and cash
equivalents
Cash flow sensitivity (net)
25,533
(25,533)
25,533
(25,533)
Consolidated – 2015
financial assets
Cash and cash
equivalents
571,981
5,724
(5,724)
5,724
(5,724)
Cash flow sensitivity (net)
5,724
(5,724)
5,724
(5,724)
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial
instrument fails to meet its contractual obligations, and arises principally from the Group’s receivables
from customers and investment securities. The Group trades only with recognised, creditworthy third
parties. It is the Group policy that all customers who wish to trade on credit terms are subject to credit
verification procedures. In addition, receivable balances are monitored on an ongoing basis with the
result that the Group’s exposure to bad debts is not significant. The maximum exposure to credit risk is
the carrying value of the receivable, net of any provision for doubtful debts.
With respect to credit risk arising from the other financial assets of the Group, which comprise cash
and cash equivalents, the Group’s exposure to credit risk arises from default of the counter party,
with a maximum exposure equal to the carrying amount of these instruments. This risk is minimised
by reviewing term deposit accounts from time to time with approved banks of a sufficient credit rating
which is AA and above.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 83
23. finanCiaL risK manaGement oBJeCtives anD poLiCies
(ContinueD)
Exposure to credit risk
The carrying amount of the Group’s financial assets represents the maximum credit exposure. The
Group’s maximum exposure to credit risk at the reporting date was:
Cash and cash equivalents
Trade & other receivables
Consolidated
2016
$
3,929,972
70,279
2015
$
571,981
84,016
4,000,251
655,997
Foreign currency risk
Exposure to foreign exchange risk may result in the fair value or future cash flows of a financial
instrument fluctuating due to movement in foreign exchange rates of currencies in which the Group
holds financial instruments which are other than the AUD functional currency of the Consolidated
Group.
The Consolidated Group is exposed to fluctuations in foreign currencies arising from the purchase of
goods and services in currencies other than the company’s measurement currency (namely $USD and
Botswana Pula). The Group’s exposure to foreign currency risk is minimal at this stage of its operations.
Commodity price risk
The Group’s exposure to commodity price risk is minimal at this stage of its operations.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Group’s reputation.
The Group’s objective is to maintain a balance between continuity of funding and flexibility. The
following are the contractual maturities of financial liabilities:
Carrying
amount
$
Contractual
cash flows
$
6 months
or less
$
463,122
463,122
70,279
70,279
–
–
–
–
463,122
463,122
70,279
70,279
Consolidated – 2016
Trade and other payables
Trade and other receivables
Page 84 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 23. finanCiaL risK manaGement oBJeCtives anD poLiCies
(ContinueD)
Consolidated – 2015
Trade and other payables
Trade and other receivables
Carrying
amount
$
Contractual
cash flows
$
6 months
or less
$
153,826
153,826
84,016
84,016
–
–
–
–
153,826
153,826
84,016
84,016
Fair value of financial assets and liabilities
The fair value of cash and cash equivalents and non-interest bearing financial assets and financial
liabilities of the Group is equal to their carrying value.
Capital risk management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a
going concern in order to provide returns for shareholders and benefits for other stakeholders and to
maintain an optimal capital structure to reduce the cost of capital. The management of the Group’s
capital is performed by the Board.
The capital structure of the Group consists of net debt (trade payables, provisions and financial
liabilities detailed in notes 12, 13, & 14 offset by cash and bank balances) and equity of the Group
(comprising issued capital, reserves, offset by accumulated losses detailed in notes 15, 16 & 17).
The Group is not subject to any externally imposed capital requirements. None of the Group’s entities
are subject to externally imposed capital requirements.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 85
24. share BaseD payments
share option plan
The Group has a Director and Employee Option Acquisition Plan (“Option Plan”) for Directors,
employees and contractors of the Group. In accordance with the provisions of the Option Plan, as
approved by shareholders at the 2015 annual general meeting, executives and employees may be
granted options at the discretion of the Directors. Options issued to Directors are subject to approval by
shareholders.
Each share option converts into one ordinary share of Impact Minerals Limited on exercise. No amounts
are paid or are payable by the recipient on receipt of the option. The options carry neither rights of
dividends nor voting rights. Options may be exercised at any time from the date of vesting to the date of
their expiry.
The following share-based payment arrangements were in existence during the reporting period:
option
series
18 (1)
19
20 (1)
21 (2)
22 (1)
23 (3)
number
Grant date
expiry date vesting date
13,000,000
20-Dec-12
30-Nov-15
30-Nov-13
9,000,000
20-Dec-12
30-Nov-16
30-Nov-14
2,900,000
16-Jan-13
30-Nov-15
30-Nov-13
2,900,000
16-Jan-13
30-Nov-16
30-Nov-14
2,800,000
14-Nov-13
30-Nov-15
30-Nov-13
3,550,000
14-Nov-13
30-Nov-16
30-Nov-14
24 (1),(4)
8,000,000
06-Jan-14
30-Nov-15
Immediate
25 (5)
26 (6)
27 (7)
28 (7)
29 (8)
30
31
32
45,000,000
07-Aug-15
07-Aug-18
Immediate
28,000,000
29-Sep-15
29-Sep-18
29-Sep-16
14,000,000
29-Sep-15
29-Sep-19
29-Sep-17
14,000,000
29-Sep-15
29-Sep-20
29-Sep-18
26,428,572
21-Oct-15
21-Oct-18
Immediate
1,000,000
13-May-16
29-Sep-18
29-Sep-16
3,000,000
13-May-16
29-Sep-19
29-Sep-17
3,000,000
13-May-16
29-Sep-20
29-Sep-18
exercise
price
fair value at
grant date
$0.06
$0.10
$0.06
$0.10
$0.06
$0.10
$0.20
$0.0325
$0.0367
$0.045
$0.07
$0.0325
$0.0367
$0.045
$0.07
$0.0113
$0.0107
$0.0113
$0.0107
$0.0445
$0.0413
n/a
$0.0185
$0.0139
$0.0149
$0.0143
n/a
$0.012
$0.0133
$0.0132
(1) These options expired during the financial year
(2) 650,000 of these options were cancelled during the financial year
(3) 2,400,000 of these options were cancelled during the financial year
(4) Options were issued to eligible Invictus Gold Limited (“Invictus”) option holders as part of the Merger
Implementation Agreement under which Impact acquired all of the shares in Invictus that it did not
own in January 2014.
(5) Options issued to Squadron Resources Pty Ltd (“Squadron”) as part of the Convertible Note issue
and ratified by shareholders at the 2015 Annual General Meeting
(6) 2,000,000 of these options were cancelled during the financial year
(7) 1,500,000 of these options were cancelled during the financial year
(8) Options issued to Squadron and approved by shareholders at the 2015 Annual General Meeting
Page 86 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 24. share BaseD payments (ContinueD)
fair value of share options granted during the year
The fair value of share options at grant date are determined using a Black-Scholes option pricing model
that takes into account the exercise price, the term of the option, the share price at grant date, the
expected price volatility of the underlying share and the risk free rate for the term of the option. The fair
value of share options issued during the year was $408,319 (2015: $101,219)
The model inputs for options granted during the year ended 30 June 2016 are as follows:
inputs
Exercise Price
Grant date
Vesting date
Expiry date
issue 25 issue 26 issue 27 issue 28 issue 30 issue 31 issue 32
$0.0325
$0.0367
$0.045
$0.07
$0.0367
$0.045
$0.07
7 Aug
2015
7 Aug
2015
7 Aug
2018
29 Sep
2015
29 Sep
2016
29 Sep
2018
29 Sep
2015
29 Sep
2017
29 Sep
2019
29 Sep
2015
29 Sep
2018
29 Sep
2020
13 May
2016
29 Sep
2016
29 Sep
2018
13 May
2016
29 Sep
2017
29 Sep
2019
13 May
2016
29 Sep
2018
29 Sep
2020
Share price at grant date
$0.027
$0.026
$0.026
$0.026
$0.027
$0.027
$0.027
Expected price volatility
82.1%
82.1%
82.1%
82.1%
89.37% 89.37% 89.37%
Expected dividend yield
0%
0%
0%
0%
0%
0%
0%
Risk-free interest rate
1.94%
1.89%
1.89%
2.66%
1.59%
1.59%
1.78%
movements in share options during the year
Movement in the number of share options on issue during the year:
2016
2015
weighted
average
exercise price
$
no. of options
weighted
average
exercise price
$
no. of options
Outstanding at the beginning of the year
42,150,000
Granted during the year
Expired during the year
Cancelled during the year
134,428,572
(26,700,000)
(8,050,000)
0.10
0.04
0.10
0.07
–
–
–
42,150,000
0.10
Outstanding at the end of the year
141,828,572
0.04
42,150,000
Exercisable at the end of the year
57,400,000
0.05
42,150,000
The weighted average remaining contractual life of share options outstanding at the end of the year was
2.38 years (2015: 0.79 years).
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 87
–
–
–
0.10
0.10
24. share BaseD payments (ContinueD)
share options outstanding at the end of the year
Share options issued and outstanding at the end of the year have the following exercise prices:
expiry Date
30 November 2015
30 November 2015
30 November 2016
7 August 2018
29 September 2018
21 October 2018
29 September 2019
29 September 2020
exercise
price
$
0.06
0.20
0.10
0.0325
0.0367
0.0325
0.045
0.07
2016
no.
2015
no.
–
–
18,700,000
8,000,000
12,400,000
15,450,000
45,000,000
27,000,000
26,428,572
15,500,000
15,500,000
–
–
–
–
–
141,828,572
42,150,000
25. reConCiLiation of Cash fLows from operatinG
aCtivities
Cash flows from operating activities
Profit / (Loss) for the period
Non-cash flows in profit/(loss):
– Depreciation
– Share based remuneration
– Finance costs
– Exploration expenditure write-off
Changes in assets and liabilities
– Decrease/(increase) in trade and other receivables
– Decrease/(increase) in other non-current assets
–
–
Increase/(decrease) in trade creditors and accruals
Increase/(decrease) in provisions
Consolidated
2016
$
2015
$
(977,735)
(4,757,575)
1,535
408,319
181,035
186,489
13,737
(22,070)
87,807
(53,381)
4,075
101,219
–
4,316,428
186,881
93,567
(26,125)
46,760
Net cash used in operating activities
(174,264)
(34,770)
non-cash investing and financing activities
There were no non-cash investing and financing activities during the year.
Page 88 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 26. reLateD party DisCLosure
Class
Country of
incorporation
ownership
2016
%
ownership
2015
%
a) parent entity
Impact Minerals Limited
Ord
Australia
–
–
b) subsidiaries
Aurigen Pty Ltd
Siouville Pty Ltd
Drummond East Pty Ltd
Seam Holdings Pty Ltd (i)
Brentwood Investments (Pty) Ltd (ii)
Icilion Investments (Pty) Ltd (iii)
Xade Minerals (Pty) Ltd (iv)
Invictus Gold Limited
Drummond West Pty Ltd (v)
Endeavour Minerals Pty Ltd (vi)
Invictus (Turkey) Pty Ltd (vii)
Drummond Uranium Pty Ltd (vii)
Ord
Ord
Ord
Ord
Ord
Ord
Ord
Ord
Ord
Ord
Ord
Australia
Australia
Australia
British Virgin Islands
Republic of Namibia
Botswana
Botswana
Australia
Australia
Australia
Australia
Australia
100
100
100
100
100
100
100
100
100
100
n/a
n/a
100
100
100
100
100
100
100
100
100
100
100
100
(i) Seam Holdings Pty Ltd is a wholly owned subsidiary of Drummond East Pty Ltd
(ii) Brentwood Investments (Pty) Ltd is a wholly owned subsidiary of Seam Holdings Pty Ltd
(iii)
Icilion Investments (Pty) Ltd is a wholly owned subsidiary of Seam Holdings Pty Ltd
(iv) Xade Minerals (Pty) Ltd is a wholly owned subsidiary of Seam Holdings Pty Ltd
(v) Drummond West Pty Ltd is a wholly owned subsidiary of Invictus Gold Limited
(vi) Endeavour Minerals Pty Ltd is a wholly owned subsidiary of Invictus Gold Limited
(vii) Invictus (Turkey) Pty Ltd and Drummond Uranium Pty Ltd were deregistered on 1 July 2015
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 89
26. reLateD party DisCLosure (ContinueD)
c) Loans to and investments in controlled entities
Loans are provided by the Parent Entity to its controlled entities for their respective operating
activities. Amounts receivable from controlled entities are non-interest bearing with no fixed term
of repayment. The carrying value of investments in controlled entities is recognised as an asset in
the Parent Entity. The future successful commercial application of these projects or the sale to third
parties supports the recognition and recoverability of these assets held in the Parent Entity.
Aurigen Pty Ltd
Siouville Pty Ltd
Drummond East Pty Ltd
Seam Holdings Pty Ltd
Brentwood Investments (Pty) Ltd
Icilion Investments (Pty) Ltd
Drummond West Pty Ltd (i)
Drummond Uranium Pty Ltd
(i) Loan from Invictus Gold Limited
d) Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Share-based payments
2016
$
2015
$
607,130
136,372
33,653
9,902
201
607,130
136,372
33,653
9,902
201
5,606,161
5,463,367
3,527,418
3,527,418
n/a
10,580
9,920,837
9,788,623
527,129
21,184
292,903
452,300
20,544
65,154
841,216
537,998
Detailed remuneration disclosures are provided in the Remuneration Report on pages 40 to 48.
27. Loss on DisposaL of ControLLeD entities
On 2 October 2014 the Group sold all the shares in its subsidiary companies, Impact Madencilick
Sanayi Ve Ticaret A.S. and Invictus Madencilik Sanayi Ve Tiracet A.S. for total consideration of 4
Turkish Lira.
A loss of $289,698 was recognised on the disposal of Impact Madencilick Sanayi Ve Ticaret A.S.and
Invictus Madencilik Sanayi Ve Tiracet A.S. No tax charge or credit arose on the transaction.
Page 90 | IMPACT MINERALS LTD ANNUAL REPORT 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JuNE 2016 28. parent entity DisCLosure
financial performance
Profit / (loss) for the year
Other comprehensive income
2016
$
2015
$
(1,656,090)
(7,374,487)
–
–
Total comprehensive profit / (loss)
(1,656,090)
(7,374,487)
financial position
assets
Current assets
Non-current assets
totaL assets
LiaBiLities
Current liabilities
Non-current liabilities
totaL LiaBiLities
net assets
eQuity
Issued capital
Option reserve
Transactions with non-controlling interest
Accumulated losses
4,173,905
2,965,015
8,498,081
3,886,200
12,671,986
6,851,215
2,529,306
244,085
–
–
2,529,306
244,085
10,142,680
6,607,130
35,950,384
31,245,003
1,222,765
736,506
(1,161,069)
(1,161,069)
(25,869,400)
(24,213,310)
totaL eQuity
10,142,680
6,607,130
No guarantees have been entered into by Impact Minerals Limited in relation to the debts of its
subsidiaries.
Impact Minerals Limited had no expenditure commitments as at 30 June 2016 other than the
commitment in relation to the lease of office premises as disclosed in note 22.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 91
DiRECTORs’ DECLARATiON
The Directors of Impact Minerals Limited declare that:
(a) in the Directors’ opinion the financial statements and notes set out on pages 51 to 91 and the
Remuneration Report in the Directors’ Report are in accordance with the Corporations Act 2001,
including :
(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and of
its performance, for the financial year ended on that date; and
(ii) complying with Australian Accounting Standards (including the Australian Accounting
Interpretations), Corporations Regulations 2001 and mandatory professional reporting
requirements.
(b) the financial statements also comply with International Financial Reporting Standards as disclosed in
note 2; and
(c) there are reasonable grounds to believe that the consolidated entity will be able to pay its debts as
and when they become due and payable.
The Directors have been given the declarations required by Section 295A of the Corporations Act 2001
by the Managing Director and Chief Financial Officer for the financial year ended 30 June 2016.
Signed in accordance with a resolution of the Directors.
peter unsworth
Chairman
Perth, Western Australia
28 September 2016
Page 92 | IMPACT MINERALS LTD ANNUAL REPORT 2016
We have audited the accompanying financial report of Impact Minerals Limited (“the
Company”) and Controlled Entities (“the Consolidated Entity”), which comprises the
statement of financial position as at 30 June 2016, and the statement of profit or loss and
other comprehensive income, statement of changes in equity and statement of cash
flows for the year then ended, notes comprising a summary of significant accounting
policies and other explanatory information, and the directors’ declaration of the
Consolidated Entity, comprising the Company and the entities it controlled at the year’s
end or from time to time during the financial year.
The directors of the Company are responsible for the preparation of the financial report
that gives a true and fair view in accordance with Australian Accounting Standards and
the Corporations Act 2001 and for such internal control as the directors determine is
necessary to enable the preparation of the financial report that gives a true and fair view
and is free from material misstatement, whether due to fraud or error. In Note 2, the
directors also state, in accordance with Accounting Standards AASB 101: Presentation
of Financial Statements that the financial statements comply with International Financial
Reporting Standards.
Our responsibility is to express an opinion on the financial report based on our audit. We
conducted our audit in accordance with Australian Auditing Standards. These Auditing
Standards require that we comply with relevant ethical requirements relating to audit
engagements and plan and perform the audit to obtain reasonable assurance whether
the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial report. The procedures selected depend on the auditor’s
judgment, including the assessment of the risks of material misstatement of the financial
report, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity’s preparation of the financial report that
gives a true and fair view in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the entity’s internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by the
directors, as well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.
In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.
In our opinion:
a. The financial report of the Consolidated Entity is in accordance with the Corporations Act 2001, including:
i.
giving a true and fair view of the Consolidated Entity’s financial position as at 30 June 2016 and of its
performance for the year ended on that date; and
ii.
complying with Australian Accounting Standards and the Corporations Regulations 2001;
b. The financial statements also comply with International Financial Reporting Standards as disclosed in
Note 2.
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2016.
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.
In our opinion, the Remuneration Report of Impact Minerals Ltd for the year ended 30 June 2016, complies
with section 300A of the Corporations Act 2001.
BENTLEYS
Chartered Accountants
MARK DELAURENTIS CA
Director
Dated at Perth this 28th day of September 2016
ADDiTiONAL shAREhOLDER iNfORmATiON
As AT 31 AUGUsT 2016
Additional information required by the Australian Securities Exchange Limited and not shown elsewhere
in this report is as follows.
1. Distribution of holders of equity securities
Analysis of number of equity security holders by size of holding:
shares held
1
–
1,001 –
5,001 –
10,001 –
100,001
Total
1,000
5,000
10,000
100,000
and over
shareholders
119
121
115
898
614
1,867
The number of holders of less than a marketable parcel of ordinary fully paid shares is 488.
2. substantial shareholders
Substantial shareholders (i.e. shareholders who hold 5% or more of the issued capital):
J P MORGAN NOMINEES AUSTRALIA LIMITED
SQUADRON RESOURCES PTY LTD
3. voting rights
number of
shares
percentage
held
242,190,359
47,619,048
30.70
6.04
(a) Ordinary Shares
Each shareholder is entitled to receive notice of and attend and vote at general meetings
of the Company. At a general meeting, every shareholder present in person or by proxy,
representative of attorney will have one vote on a show of hands and on a poll, one vote for
each share held.
(b) Options
No voting rights.
4. Quoted securities on issue
The Company has 788,771,085 quoted shares on issue. No options on issue by the Company are
quoted.
5. on-market Buy Back
There is no current on-market buy back.
IMPACT MINERALS LTD ANNUAL REPORT 2016 | Page 95
ADDiTiONAL shAREhOLDER iNfORmATiON
As AT 31 AUGUsT 2016
6. unquoted equity securities
number
on issue
number of
holders
Options exercisable at $0.10 on or before 30 November 2016
Options exercisable at $0.0325 on or before 7 August 2018
12,400,000
45,000,000
Options exercisable at $0.0367 on or before 29 September 2018
27,000,000
Options exercisable at $0.0325 on or before 21 October 2018
Options exercisable at $0.045 on or before 29 September 2019
Options exercisable at $0.07 on or before 29 September 2020
26,428,572
15,500,000
15,500,000
7
1
9
1
10
10
7. twenty Largest holders of Quoted ordinary shares
shareholder
number of
shares
percentage
held
J P MORGAN NOMINEES AUSTRALIA LIMITED
242,190,359
30.70
SQUADRON RESOURCES PTY LTD
BNP PARIBAS NOMS PTY LTD
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