ANNUAL REPORT
2020
Inca Minerals Limited
ACN 128 512 907
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2
CORPORATE PARTICULARS
Directors
Mr Ross Brown
Managing Director
Mr Gareth Lloyd
Director
Dr Jonathan West
Director
Company Secretary
Mr Mal Smartt
Registered Office
Suite 1, 16 Nicholson Road
Subiaco WA 6008
Corporate Office
Suite 1, 16 Nicholson Road
Subiaco WA 6008
Mailing Address
P.O. Box 38
West Perth WA 6872
Share Registry
Advanced Share Registry
110 Stirling Highway
Nedlands WA 6009
Auditor
Stantons International
Level 2, 1 Walker Avenue
West Perth WA 6005
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Table of Contents
Managing Director’s Summary
Corporate Governance Statement
Managing Director’s Annual Review
Directors’ Report
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Auditor’s Independence Declaration
Independent Auditor’s Report
Shareholder Information
List of Tenements
1
2
3
9
10
19
20
21
22
23
50
51
52
56
58
1
Managing Director’s Summary
2
Welcome to Inca’s Annual Report (Report) for the financial year ended 30 June 2020, a year of COVID-19, a year of
travel bans, compromised industry-wide activities and adverse market reactions. This in not going to be the theme
of our Report. Indeed, Inca has made tremendous progress this year, a springboard to the future—the theme is
that of a new beginning as we set up for a phase of tier-1 target drilling activities.
Think Inca, think tier-1 drill testing and think gold, copper and silver.
In this Annual Report you will find our Annual Financial Report, Directors’ Report,
Directors’ Declaration, the Independent Auditor’s Report, Corporate Governance
Statement, various shareholder information and our tenement schedule. Like in the
previous annual report, I have provided this summary so that you may quickly
understand the past year’s exploration activities, our results, our corporate well-being
and perhaps more importantly, our objectives moving forward.
The “elephant in the room” was the withdrawal of Inca’s funding partner from our
flagship Riqueza Project in Peru in May this year. Having committed well over
large-scale
$3million to exploration designed to generate drill targets for
mineralisation, our former partner withdrew prior to the work being completed. Over
three years under an option period, then an earn-in period, the former participant
funded inter alia an extensive airborne magnetic and radiometric survey, a +1,200-
sample soil geochemical survey, mapping and sampling, and a final induced
polarisation (IP) survey. Inca was manager during this phase, and so with the return
of 100% of the project, and a list of 28 high quality drill targets, we have quickly “picked
up the cudgel” and are moving ahead.
This has not been the only development of the year. Inca has now also consolidated its Australian project portfolio
to include an expanded Frewena Group Project (Frewena), the Jean Elson Project, the Lorna May Project and the
MaCauley Creek Project. All are highly prospective for large-scale forms of mineralisation. Except MaCauley Creek,
all are highly prospective for Olympic Dam style iron-ore copper and gold (or IOCG) mineralisation. MaCauley Creek
is prospective for gold-copper epithermal and porphyry mineralisation.
The short-term, medium-term and long-term strategies described by me in the Managing Director’s Summary of
last year’s Annual Report are now fully in play. The comings and goings of funding partners are part and parcel of
the vicissitudes of the resources sector, this year tainted by the COVID-19 pandemic. We lose a funding partner in
Peru. We gain a funding partner in the Northern Territory Geological Survey (NTGS) at Frewena. It’s ironic that the
new funding partner is helping us with an extensive airborne magnetic and radiometric survey at Frewena, the
same method-of-choice used by our ex-partner to generate the initial success at Riqueza.
I mentioned above that the year is a springboard to the future. This is true. At Riqueza, the long process of drill
target generation is behind us. As I write, we are making progress with a drill permit to commence drilling, initially,
in the NE part of Riqueza before the end of the year. We call it our “first generation” tier-1 drill program. We have
also generated the “next generation” tier-1 drilling targets, this time in the Northern Territory and Queensland.
These will be better defined in the year ahead. Then drilled.
I’d like to close now by thanking our shareholders for overwhelmingly supporting our recent capital consolidation,
(as a post Report Period event) voted and passed at a General Meeting on 25 August 2020. As much as exploration
prepares us for future possible discovery and rerate, the consolidation prepares us corporately for share price
responsiveness and growth.
Ross Brown
Managing Director
2
Corporate Governance Statement
3
The Board of Directors of Inca Minerals Limited (Inca or Company) is responsible for the corporate governance of the
Company. In developing its corporate governance policies Inca has referred to recommendations within the ASX Corporate
Governance Council’s Corporate Governance Principles and Recommendations 3rd edition (CGPR) and developed the
following policies which can be found on the Company’s website at www.incaminerals.com.au under the section titled
“Corporate/Corporate Governance”:
▪ Corporate Governance Policy
▪ Continuous Disclosure Policy
▪ Code of Conduct & Securities Trading Policy
▪ Diversity Policy
The Company’s corporate governance practices during the financial year ended 30 June 2019 (Reporting Period) are reported
below. Where the Company’s corporate governance practices follow the CGPR the Board has provided appropriate
statements reporting on the adoption of the CGPR. In compliance with the “if not, why not” reporting framework, where
the Company’s corporate governance practices differ from the relevant CGPR, the Board has explained its reasons for doing
so and any alternative practice the Company may have adopted.
CORPORATE GOVERNANCE STATEMENT
CORPORATE GOVERNANCE PRINCIPLES
ADOPTED / NOT ADOPTED AND COMMENT
& RECOMMENDATIONS
Principle 1: Lay solid foundations for management and oversight.
1.1 Listed entities
roles and
should disclose
responsibilities of its Board and management, those
expressly reserved to the Board and those delegated to
management.
the
1.2 Listed entities should undertake appropriate checks
before appointing a person or putting forward to security
holders a candidate for election as a Director; and provide
security holders with all material information in its
possession relevant to a decision on whether or not to
elect or re-elect a Director.
A
A
1.3 Listed entities should have written agreements with each
Director and senior executive setting out the terms of
their appointment.
A
The Company has formalised and disclosed on its website
(at www.incaminerals.com.au) the functions reserved to
the Board and those delegated to management within its
Corporate Governance Policy.
The Company undertakes appropriate checks before
appointing a person or putting forward to shareholders a
candidate for election or re-election as a Director and
provides shareholders with all material information in its
possession relevant to a decision on whether to elect or re-
elect a Director.
The Company has set out the terms of appointment in
writing with each Director and senior executive.
1.4 The company secretary of a listed entity should be
accountable directly to the Board, through the chair, on
all matters to do with proper functioning of the Board.
1.5 Listed entities should:
(a) Have a diversity policy which includes requirements
for the Board or relevant Board committee to set
measurable objectives for achieving gender diversity and
to annually assess and disclose the objectives and
progress towards their achievement;
(b) Disclose that policy or a summary of it; and
(c) Disclose as at the end of each reporting period the
measurable objectives for achieving gender diversity set
by the Board (or relevant Board committee)
in
accordance with the entity’s diversity policy and its
progress towards achieving them, and either:
[1] the respective proportions of men and women on the
Board, in senior management positions and across the
whole organisation (including how the entity has defined
“senior executive” for these purposes) or
Legend: A = Adopted NA = Not Adopted
NA The Company did not appoint a Chairperson during the
Reporting Period. The Company Secretary is accountable
directly to the Board as to the proper functioning of the
Board.
NA The Company has disclosed its Diversity Policy on its website
at www.incaminerals.com.au. The Company’s Diversity
Policy does not mandate setting measurable objectives for
achieving gender diversity as it is impractical to do so at this
time.
The proportion of women across the whole
organisation, in senior executive positions, and on the
Board, as at the date of this statement, is as follows:
• Whole organisation – 24%
•
Senior Executive Positions – 50%
Board – 0%
•
For the purposes of this statement and the Company’s
gender diversity, “senior executive” means a person who
reports directly to the Board or Managing Director and/or
who makes or participates in making decisions that could
significantly affect the Company’s operations.
3
Corporate Governance Statement (continued)
4
CORPORATE GOVERNANCE PRINCIPLES
ADOPTED / NOT ADOPTED AND COMMENT
& RECOMMENDATIONS
Principle 1: Lay solid foundations for management and oversight (Ctd)
1.5 (ctd)
[2] if the entity is a “relevant employer” under the
Workplace Gender Equality Act, the entity’s most recent
“Gender Equality Indicators” as defined under that Act.
1.6 Listed entities should have and disclose a process for
periodically evaluating the performance of the Board, its
individual directors; and disclose
committees and
whether a performance evaluation was undertaken in the
reporting period in accordance with that process.
1.7 Listed entities should have and disclose a process for
periodically evaluating the performance of its senior
executives; and disclose whether a performance
evaluation was undertaken in the reporting period in
accordance with that process.
A
A
The Company’s processes for evaluating the performance
of the Board and its Directors are disclosed on the
Company’s website at www.incaminerals.com.au in the
Company’s Corporate Governance Policy. During the
Reporting Period these evaluations took place
in
accordance with the process outlined in the Corporate
Governance Policy.
The Company’s processes for evaluating its Managing
Director and key executives are disclosed on the Company’s
website at www.incaminerals.com.au in the Company’s
Corporate Governance Policy. During the Reporting period
the Board evaluated the performance of its Managing
Director in accordance with the process outlined in its
Corporate Governance Policy. A similar process, with respect
to certain key executives, was completed by the Managing
Director.
Principle 2: Structure the Board to add value
2.1 (a) The Board of a listed entity should have a nomination
committee of at least three members (a majority of
whom are
independent directors) chaired by an
independent director and disclose:
A
•
•
•
The committee charter
The committee members; and
As at the end of each reporting period, the number
of times the committee met throughout the period
and the individual attendances of the members at
those meetings; or
(b) If a nomination committee is not established then
disclose that fact and the processes employed to
address board succession issues, and to ensure the
Board has the appropriate balance of skills, knowledge,
experience, independence and diversity to enable it to
discharge its duties and responsibilities effectively.
2.2 Listed entities should have and disclose a board skills
matrix setting out the mix of skills and diversity that the
Board currently has or is looking to achieve in its
membership.
Legend: A = Adopted NA = Not Adopted
The Company has a small Board consisting of three Directors
inclusive of the Managing Director. The Board considers it
desirable to use the full complement of knowledge,
expertise and experience of all its Directors in making
decisions and performing the functions usually associated
with a Nomination Committee. The Company’s Corporate
Governance Policy and Diversity Policy disclose (on the
Company’s website
at www.incaminerals.com.au)
processes pertaining to board succession, skills, knowledge,
experience, independence and diversity.
A
The Company has disclosed (in its Corporate Governance
Policy and Diversity Policy at www.incaminerals.com.au) the
mix of skills and diversity the Board currently has and
considers desirable in its membership given the Company’s
stage of development.
4
Corporate Governance Statement (continued)
5
CORPORATE GOVERNANCE PRINCIPLES
ADOPTED / NOT ADOPTED AND COMMENT
& RECOMMENDATIONS
Principle 2: Structure the Board to add value (Ctd)
2.3 Listed entities should disclose the names of directors
considered by the Board to be independent directors, the
length of each director’s service and, if a director has an
interest, position, association or relationship that might
cause doubt about the independence of that director, but
the Board is of the opinion that it does not compromise
the independence of the director, disclose the nature of
the interest, position, association or relationship in
question and disclose why the Board is of that opinion.
2.4 A majority of a
listed entity’s Board should be
independent directors.
2.5 The Chairperson of a
listed entity should be an
Independent Director and, in particular, should not be the
same person as the CEO of the entity.
2.6 Listed entities should have an induction program for new
directors and provide professional development
opportunities for directors to develop and maintain the
skills and knowledge to perform their role as directors
effectively.
Principle 3: Act ethically and responsibly
3.1 Listed entities should have a code of conduct for its
directors, senior executives and employees and disclose
that code or a summary of it.
Principle 4: Safeguard integrity in corporate reporting
4.1 Listed entities should:
(a) Have an audit committee which:
(1) Has at least three members, all of whom are non-
executive directors and a majority of whom are
independent directors; and
(2) Is chaired by an independent director, who is not
the chair of the Board, and disclose:
(3) The charter of the committee;
(4) The relevant qualifications and experience of the
members of the committee; and
(5) In relation to each reporting period, the number
of times the committee met throughout the
period and the individual attendances of the
members at those meetings; or
(b) If it does not have an audit committee, disclose that
fact and the processes employed to independently
verify and safeguard the integrity of its corporate
the
reporting,
appointment and removal of the external auditor and
the rotation of the audit engagement partner.
the processes
including
for
A
All current Directors hold shares in Inca either directly or
beneficially and a third Director is a part owner of the
Company’s former Corporate Advisor meaning none of the
current three Directors are considered independent. The
Company has disclosed the names of its Directors, their
position, relevant interests or associations and their length
of service in the Company’s 2020 Annual Financial Report.
NA As discussed above, none of the Company’s Directors can be
considered independent directors. As shareholders or
former commercial advisors, the interests of Inca’s Directors
should, in their judgements and decisions, be directly
aligned with those of all other shareholders.
NA The Company operated without a Chairperson during the
Reporting Period.
A
A
An induction program will be provided to any new directors
if and when a new director is appointed. Professional
development opportunities are provided to the Directors as
and when needed.
The Company has disclosed its Code of Conduct & Securities
at
the
Policy
Trading
www.incaminerals.com.au.
Company’s website
on
A
The Company has a small Board consisting of two Directors
and the Managing Director. At this stage, the Company has
not established an Audit Committee and the Board prefers
to use the full complement of knowledge, expertise and
experience of all Directors in making decisions regarding the
Company’s audit and the Company’s external auditors. All
three Directors are financially literate. In June 2012 the
Company engaged its current accountant – a person with
considerable experience as both an external auditor and
group accountant in mineral exploration companies.
The Company’s external auditors were appointed
in
November 2012. Prior to their appointment the Board
obtained proposals from reputable audit firms and
appointed the Company’s current auditor after considering
listed exploration companies
their experience with
operating
jurisdictions, the
experience and quality of personnel involved with the
Company’s audit, their internal quality control measures,
their approach and methodology in conducting the audit,
references, and awareness of professional requirements
within accounting and
in foreign and domestic
Legend: A = Adopted NA = Not Adopted
5
Corporate Governance Statement (continued)
6
CORPORATE GOVERNANCE PRINCIPLES
ADOPTED / NOT ADOPTED AND COMMENT
& RECOMMENDATIONS
Principle 4: Safeguard integrity in corporate reporting (Ctd)
4.1 (Ctd)
4.2 The Board of a listed entity should, before it approves
the entity’s financial statements for a financial period,
receive from its CEO and CFO a declaration that, in
their opinion, the financial records of the entity have
been properly maintained and that the financial
statements comply with the appropriate accounting
standards and give a true and fair view of the financial
position and performance of the entity and that the
opinion has been formed on the basis of a sound
system of risk management and internal control which
is operating effectively.
4.3 Listed entities should ensure that its external auditor
attends its AGM and is available to answer questions
from security holders relevant to the audit.
Principle 5: Make timely and balanced disclosure
5.1 Listed entities should have a written policy for
complying with its continuous disclosure obligations
under the Listing Rules and disclose that policy or a
summary of it.
to
those pertaining
auditing standards
including
independence, confidentiality and conflicts of interest.
A Prior to approving the financial statements for the half-
year ended 31 December 2019 and the full year ended 30
June 2020 Inca’s Board received from the Managing
Director and Chief Financial Officer declarations that, in
their opinion, the financial records of the entity have been
properly maintained and that the financial statements
comply with the appropriate accounting standards and
give a true and fair view of the financial position and
performance of the entity and that the opinion has been
formed on the basis of a sound system of risk
management and internal control which is operating
effectively.
A During the Reporting Period and prior to the Company’s
AGM the Company contacted its external auditors who
agreed to host the Company’s AGM in their offices and
attend the AGM. In accordance with section 250S of the
Corporations Act the external auditor attended the AGM
and the Chair expressly provided the opportunity for
shareholders attending the meeting to ask questions
relevant to the audit. Had there been any written
questions submitted to the auditor (there were none) the
Chair would also have ensured the opportunity for the
external auditor to answer questions as required under
section 250PA of the Corporations Act.
A The Company has established written policies for
complying with continuous disclosure obligations under
the ASX Listing Rules which are disclosed within the
Company’s Continuous Disclosure Policy on the Company’s
website at www.incaminerals.com.au.
Principle 6: Respect the rights of security holders
6.1 A listed entity should provide information about itself
A
and its governance via its website.
Legend: A = Adopted NA = Not Adopted
The Company provides information about itself and its
governance
at
www.incaminerals.com.au.
its website
investors
via
to
6
Corporate Governance Statement (continued)
7
CORPORATE GOVERNANCE PRINCIPLES
ADOPTED / NOT ADOPTED AND COMMENT
& RECOMMENDATIONS
Principle 6: Respect the rights of security holders (Ctd)
6.2 Listed entities should design and implement an investor
facilitate effective two-way
relations program to
communication with investors.
A
6.3 Listed entities should disclose the policies and processes
it has in place to facilitate and encourage participation at
meetings of security holders.
6.4 Listed entities should provide security holders with the
option to receive communications from and send
communications to the entity and its share registry
electronically.
Principle 7: Recognise and manage risk
7.1 The listed entity’s Board should:
(a) Have a committee or committees to oversee risk,
each of which:
(1) Has at least three members, a majority of
whom are independent directors; and
(2) Is chaired by an independent director, and
disclose:
(3) The charter of the committee;
(4) The members of the committee; and
(5) as at the end of each reporting period, the
number of times the committee met
throughout the period and the individual
attendances of the members at those
meetings; or
(b)
If it does not have a risk committee or committees
that satisfy (a) above, disclose that fact and the
processes it employs for overseeing the entity’s risk
management framework
7.2 The listed entity’s Board or a committee of the Board
should review the entity’s risk management framework
at least annually to satisfy itself that it continues to be
sound and disclose, in relation to each reporting period,
whether such a review has taken place.
7.3 Listed entities should disclose if they have an internal
audit function, how the function is structured and what
role it performs or, if it does not have an internal audit
function, that fact and the processes it employs for
evaluating and continually improving the effectiveness of
its risk management and internal control processes.
7.4 Listed entities should disclose whether they have any
material exposure to economic, environmental and social
sustainability risks and, if it does, how it manages or
intends to manage those risks
Legend: A = Adopted NA = Not Adopted
to
facilitate
effective
The Company has designed and implemented an investor
relations program
two-way
communication with investors. The program is set out in the
Company’s Continuous Disclosure Policy and Corporate
Governance Policy (in the section entitled “Shareholder
Communication Policy”) as disclosed on
its website at
www.incaminerals.com.au.
Refer above – the Company’s Corporate Governance Policy
(containing its “Shareholder Communication Policy”) and the
Company’s Continuous Disclosure Policy are both published on
the Company’s website at www.incaminerals.com.au.
Shareholders are given the option to receive communications
from and send communications to the Company and its share
registry electronically.
A
A
for overseeing
the Company’s
is disclosed within
A Given the size and composition of the current Board it
believes that no efficiencies are to be gained by establishing
a separate Risk Committee. During the Reporting Period,
risk
responsibility
management rested with the Board. The Company’s Risk
Management Policy
its Corporate
Governance Policy on
the Company’s website at
www.incaminerals.com.au. During the Reporting Period the
full Board reviewed and where necessary amended its risk
management matrix and in so doing identified or confirmed
business risks, assessed the likelihood and materiality of
these risks, developed and
implemented measures to
mitigate these risks and during the Reporting Period the
Managing Director reported on and confirmed that the
Company’s economic, social and environmental risks are
being managed effectively.
A
Refer above.
A
The Company does not have an internal audit function. Refer
above (7.1) for further discussion.
A
The Company faces economic, social and environmental risks
that are
inherent to the global and domestic
economies, the industry, capital markets and the jurisdictions
in which it operates.
largely
7
Corporate Governance Statement (continued)
8
CORPORATE GOVERNANCE PRINCIPLES
ADOPTED / NOT ADOPTED AND COMMENT
A
The Board has considered these risks in relation to a
“material exposure threshold”, as required under the
CPGR, and put in place measures to reduce these risks to
tolerable levels and, as defined in CPGR, there does not
appear to be “a real possibility that the risk could
substantively impact the Company’s ability to create or
preserve value for security holders …” in the foreseeable
future.
A Given the size and composition of the current Board it
believes that no efficiencies are to be gained by
establishing a separate Remuneration Committee. During
the Reporting Period the Board followed the Company’s
Remuneration Policy as disclosed in the Director’s Report
of the Company’s Annual Financial Report for the year
ended 30 June 2020. In doing so the Board employed
policies and processes designed to ensure equitable and
responsible levels and composition of remuneration to
Directors and senior executives.
& RECOMMENDATIONS
Principle 7: Recognise and manage risk (Ctd)
7.4 (Ctd)
Principle 8: Remunerate fairly and responsibly
8.1 Listed entities should:
(a) Have a remuneration committee which:
(1) Has at least three members, a majority of
whom are independent directors; and
(2) Is chaired by an independent director, and
disclose:
(3) The charter of the committee;
(4) The members of the committee; and
(5) As at the end of each reporting period, the
number of times the committee met
throughout the period and the individual
attendances of the members at those
meetings; or
(b)
If it does not have a remuneration committee,
disclose that fact and the processes it employs for
setting the level and composition of remuneration
for directors and senior executives ensuring that
such
is appropriate and not
excessive.
remuneration
8.2 Listed entities should separately disclose their policies
and practices regarding the remuneration of non-
executive directors and the remuneration of executive
directors and other senior executives
A During the Reporting Period the Board followed the
Company’s Remuneration Policy which
is separately
disclosed in the Director’s Report of the Company’s Annual
Financial Report for the year ended 30 June 2020.
8.3 Listed entities which have an equity-based remuneration
scheme should have a policy on whether participants are
permitted to enter into transactions (whether through
the use of derivatives or otherwise) which limit the
economic risk of participating in the scheme and disclose
that policy or a summary of it.
A
The Company has adopted a Directors’ Remuneration-
Sacrifice Share Plan that was approved by shareholders at
a General Meeting on 31 May 2019. The plan was included
as Schedule 1 in the Notice of General Meeting for 31 May
2019, and this outlines on how the participants are
permitted to enter into transactions. This includes the
requirement that all shares issued under the Plan to be
done with the requisite shareholder approval required
pursuant to the ASX Listing Rules and the Corporations Act.
Legend: A = Adopted NA = Not Adopted
8
Managing Director’s Annual Review
9
Shareholders will recall my description of the 2018/2019 year as a period of transformation―the year before that as a period of
an exploration “re-set”. I describe 2019-2020 (the Report Period) as a year of preparation, culminating in a state of readiness.
We have completed the long process of drill target generation at Riqueza and we have developed a stunning portfolio of new
projects in Australia. It has been a three-year progression, mapped out and executed. Changing our exploration focus. Acquiring
new-focus assets. Defining new-focus tier-1 targets for drill testing.
The Company focus is large-scale (or tier-1) gold, copper and silver mineralisation. Mineralised systems with tremendous gold-
copper-silver payloads include porphyries and iron ore copper gold (IOCG) deposits.
At Riqueza, a total of 28 drill targets have been generated (most targets generated by an independent consultancy) that are to
be tested for large-scale gold-silver-copper epithermal, gold-copper-silver porphyry and copper-zinc skarn mineralisation. The
drill proposal is that of 43 holes for a total of 19,010 metres.
In the Northern Territory, additional projects have been acquired and existing ones expanded. The Frewena Group Project
comprises the Frewena Fable Project (expanded), the Frewena East Project (new) and the Frewena Far East Project (new). They
are centrally located in the new East Tennant IOCG belt. The Lorna May Project has been coupled with the Jean Elson Project
(new). All of these projects have existing IOCG targets which will be the focus of definition and next-gen drilling.
In Queensland, at our MaCauley Creek Project, we have uncovered bonanza silver grade mineralisation and have had past
geophysical data reviewed, in which three intrusive bodies have been reinterpreted by an independent consultancy. Mac Creek,
as it’s affectionately called, is highly prospective for tier-1 scale porphyry mineralisation. It too is part of the next-gen drilling
campaign.
On the corporate front, we continue to drive down administrative costs. Our quarterly 2019-2020 administrative costs have
averaged $167,000 during 2019-2020, down on a historical average (since listing in May 2012) of $190,000 per quarter. We believe
we have struck the right balance between exploration and admin, spending $3.83 on exploration for every dollar spent on
admin.
The Report Period will be remembered for COVID-19. Whilst exploration programs were not materially affected by this
pandemic, Australian travel bans have led to the temporary cancellation of Inca’s shareholder workshop program. We fully
intend recommencing these invaluable Inca management-shareholder interactions―Q&A’s designed to explain exploration
results and Company strategies.
There are three things to remember about Inca when thinking about the Report Period and the coming year(s):
• Drill target generation is completed at Riqueza. After 3 years of thorough externally funded exploration, 28 tier-1
epithermal, porphyry and skarn targets have been de-risked to the extent they can. Actual “first-gen” drilling is next.
The Australian project portfolio is settled. “Next-gen” drill targeting already begun for tier-1 porphyry and IOCG
mineralisation.
•
• We have our house in order. Thanks to shareholder support, as a post Report Period material outcome, we have
completed a capital consolidation. We continue to be careful with funds and strive for the balance between
exploration and admin expenditure.
The strategy that was incubated in 2017-2018 is now two years running and paying dividends. The demise of our funding partner
at Riqueza is a consequence of global events and high-level decision making. The partnership strategy remains a valid and
valuable pursuit. Indeed, Inca secured a co-funding partner for a large geophysical survey at our new Frewena Group Project.
We will continue to look for strategic partnerships.
Ross Brown
Managing Director
Ross Brown
Director
9
Directors’ Report
10
The Directors of Inca Minerals Limited (Inca or Company) present their financial report on the Company and its
controlled entities (Group) for the year ended 30 June 2020.
Directors
The names of directors in office at any time during or since the end of the financial year are listed hereunder.
Directors were in office since the start of the financial year to the date of this report unless otherwise stated.
Ross Brown, Managing Director
Gareth Lloyd, Director
Jonathan West, Director
Information on Directors and Company Secretary
ROSS BROWN B.Sc (Hons), M.Aus.IMM.
Managing Director
A geologist by profession, Mr Brown has over 30 years’ experience in mineral exploration in Australia, Asia, Africa
and South America and he has worked in a broad range of commodities, including gold, base metals, uranium,
phosphate and diamonds. Mr Brown has a rare ability in recognising the commercial potential of exploration
projects and geological process, and has a proven track record of bringing technical-based exploration concepts
and projects to market.
In 2009 Mr Brown co-founded the gold/copper exploration company, Mystic Sands Pty Ltd, which was established
for the purposes of conducting exploration in Chile, South America. With the assistance of other technical
management, Mr Brown was responsible for the composition of the initial project portfolio. Mystic Sands was
purchased by an Australian-listed explorer White Star Minerals Ltd. As part of the transaction, Sandfire Resources
NL became a shareholder of White Star Minerals Ltd.
Mr Brown turned his attention to Peru in 2009 and through his network of Peruvian-based businessmen and
geologists assessed the potential of more than a hundred projects. Mr Brown recognised the great potential of
mineral discovery in that country and has subsequently secured a number of projects for the Company including
the Riqueza and Cerro Rayas zinc-silver-lead projects which the Company is currently exploring and evaluating.
Mr Brown was the co-founder and Managing Director of Urcaguary Pty Ltd (Urcaguary), the Company’s fully
owned subsidiary (formerly called Inca Minerals Limited) and he became the Company’s Managing Director after
its takeover of Urcaguary. As at 30 June 2020, and in addition to his position with the Company, Mr Brown remains
a Director of Urcaguary and the Company’s other subsidiary companies. In the previous 3 years, Mr Brown has not
been a director of any other ASX listed companies.
Mr Brown has been a member of AusIMM since 1988, and is also a member of GSA, SEG and AICD.
10
Directors’ Report (continued)
Information on Directors and Company Secretary (continued)
GARETH LLOYD B.Sc (Hons)
Director
11
As at 30 June 2020, in addition to his position with Inca, Mr Lloyd was also a Director of Inca’s subsidiary companies.
Mr Lloyd has over 30 years’ experience with mining and exploration companies and brings considerable technical,
commercial and capital raising expertise to the Company. A mining engineer by training, he has operating
experience in gold, base metals and coal operations in Australia, South Africa and the United Kingdom.
Mr Lloyd is a part owner of the Element group, a Perth-based boutique advisory and funds management group
focused on the resources sector through which Mr Lloyd provides strategic advice and fund-raising services to both
listed and unlisted companies (predominantly mining and exploration companies) using both equity and mezzanine
instruments.
Prior to establishing Element (in 2008), Mr Lloyd was an Associate Director at the Rothschild Group where he
helped establish the Golden Arrow Funds I and II, the latter fund becoming the ASX-listed LinQ Resources Fund. At
the time of his departure from LinQ, the fund was one of Australia’s largest listed resource funds with funds under
management of over $475m. He has held a number of senior positions at Australian resource-focused stockbroking
firms including Research Director at Hartleys and Resources Analyst at Eyres Reed. In the previous 3 years, Mr
Lloyd has not been a director of any other ASX listed companies.
DR JONATHAN WEST BSc (Hons), MSc (Explor Geol), PhD.
Director (appointed 21 January 2019)
Dr Jonathan West has worked across a variety of resource and energy development and management areas, in
both the private and public sector for over 40 years, both in Australia and overseas. He has extensive senior
management experience with a particular focus on strategic planning, policy development, resource development
and management, and corporate and organisational change management. He has extensive experience with
shareholder/stakeholder engagement and in working directly with traditional owners on a range of resource
management and economic development projects. He was a director at Excelsior Gold Limited between 2016 –
2018.
MALCOLM SMARTT BA (Accounting), Grad Dip Corporate Management, FCPA, FCIS, FCIM
Company Secretary (appointed 17 May 2019)
Mr Smartt is a Corporate Consultant to listed and unlisted public companies. He is a qualified Accountant and
Company Secretary having had considerable experience in Directorial, Financial and Company Secretary roles with
a number of listed companies in the resource sector in Australia, South East Asia and Africa.
11
Directors’ Report (continued)
OPERATING AND FINANCIAL REVIEW
Operating Results
12
The Company’s operating loss after income tax for the report period was $1,472,889 (2019: loss of $1,879,854 ).
Principal Activities
The Company’s principal activities during the year were conducting exploration at our flagship Riqueza Project in
Peru, partnership negotiations with South32 regarding Riqueza, assessing new projects and acquiring new
projects. Inca’s main focus of the year was to initiate a strategy of project acquisition, exploration and evaluation,
and partnership. The strategy is designed to reduce operation costs, achieve partnerships over gold-copper
focussed projects with Tier-1 potential and to have significant free carry positions.
Review of Operations
The Company’s exploration activities, as well as other corporate activities of the year, were released to the
Australian Securities Exchange (ASX) throughout the year ended 30 June 2020 (report period). These ASX
announcements should be accessed (The Company’s ASX code is ICG) and read in conjunction with this annual
report.
During the report period, the Company’s payments to suppliers and employees combined with payments for
exploration and payments for project acquisitions totalled $3,791,293, of which $3,408,628 (89.90%) represents
cash flows on exploration, and $382,665 (10.10%) represents cash outflows on administrative staff and
administration. As in previous years, these figures highlight the Company’s continued focus on the deployment of
funds for exploration purposes to extract value through mineral discovery at its projects. The value-proposition
this year now also extends to developing partnerships for extant and new projects alike.
The Company’s funding partner at Riqueza withdrew during the Report Period. A Withdrawal Notice was provided
to the Company on 14 May 2020 and, in accordance with the Earn-in Joint Venture Agreement (EIJVA), the EIJVA
automatically terminated 60 days later on the 13 July 2020. The former partner funded exploration under an option
agreement and EIJVA for a period of approximately 3 years, contributing approximately $3.5million. That company
withdrew from Riqueza before the exploration programs it funded were reviewed and before an independent drill
proposal was compiled.
The Company also focussed on delivering additional projects selected on the basis that they would be prospective
for tier-1 scale mineralisation; be conducive to rapid value-add exploration; be attractive to major mining houses;
and therefore have a trajectory similar to Riqueza.
Very significant developments were achieved during the Report Period at Riqueza. These include:
The recognition of a very large (7.5km x7.5km) intrusive-related mineralised hydrothermal system.
The generation of 28 drill targets prospective for tier-1 scale:
•
•
• Gold-silver-copper epithermal mineralisation;
• Gold-copper-silver porphyry mineralisation;
• Copper-zinc skarn mineralisation;
•
• Gold-copper-zinc volcanic massive sulphide (VMS) mineralisation; and
•
Silver-lead-zinc carbonate replacement mineralisation;
The generation of an independent drill program proposal of 43 holes for 19,010 metres of drilling.
12
Directors’ Report (continued)
OPERATING AND FINANCIAL REVIEW (continued)
Review of Operations (continued)
13
Very significant developments were achieved during the Report Period at the Australian projects. These include:
•
•
•
•
•
The Frewena Fable Project was expanded to the north through the successful application, NT Government
(NTG) allocation and granting of Exploration Licence EL32287 (called Frewena Fable North). Frewena Fable
now hosts the large Alpaca Army and Tamborine IOCG’s targets and the project now adjoins a large
Newcrest Mining project immediately to the north.
The Frewena Far East Project was acquired through the successful application, NTG allocation and granting
of Exploration Licence EL32293. Frewena Far East hosts an exceptionally large IOCG target with coincident
gravity, magnetic, radiometric and topographic signatures. Initial field work
located expansive
occurrences of iron-rich breccias, a geological result that serves of a proof-of-concept for the IOCG
exploration model of the project.
The Company was awarded a co-funding grant as part of the Drilling and Geophysics Collaboration Scheme
(DGCS) from the NTG. The grant will fund 45% of the costs of a 1,182km2 airborne magnetic and radiometric
survey planned to cover all the IOCG targets of the Frewena Fable and Frewena Far East. It is scheduled in
the latter part of 2020.
The Frewena East Project was acquired through the successful application, NTG allocation and granting of
Exploration Licence EL32289. Notwithstanding the fact that the NTG allocation greatly reduced the
Company’s application area, the project remains of strategic value.
The Toolebuc Project was dropped by the Company in the Report Period. This was to reduce exploration
costs associated with non-core exploration projects.
The 2019-2020 report period represents a very significant year, a year of preparedness, as the Company completes
pre-drilling tier-1 target generation exploration at Riqueza and settles it’s Australian projects. It’s the third-year of
a four-year progression: moving from year 1, changing our exploration focus; to year 2, acquiring tier-1-focus
projects; merging with year 3, generating tier-1 targets for drill testing. Year 4 and beyond is the execution of tier-1
drilling, “first-gen” drilling at Riqueza and the “next-gen” drilling in Australia.
Pre-empting the increasing fluctuating fortunes of the resource sector and volatility of the money markets, some
time ago the Company instigated a strategy of sustained exploration through partnerships to reduce operating
costs while accessing exploration know-how and large exploration treasuries. This strategy remains in play, despite
the withdrawal of the funding partner from Riqueza. Inca has already obtained a funding partner for exploration
at the Frewena Group Project.
Financial Position
The net assets of the Group were $6,708,691 as at 30 June 2020 ($6,512,208 as at 30 June 2019).
Significant Changes in the State of Affairs
The Company raised capital of $2.3 million (before broker commissions and other costs of capital raising) during
the report period via the issue of 1,102,633,628 fully paid ordinary shares.
During the year, the Company bought back 110,000,000 fully paid ordinary shares previously issued as collateral to
a broker.
There were no other significant changes in the state of affairs of the Group during the financial year.
13
Directors’ Report (continued)
OPERATING AND FINANCIAL REVIEW (continued)
Dividends Paid or Recommended
14
The directors do not recommend the payment of a dividend and no dividends have been paid or declared since the
start of the financial year.
Significant Events After Reporting Date
The Company received written notification dated 14 May 2020 from South 32, that pursuant to the Agreement,
South 32 exercised its right to withdraw from the Project held by Brillandino. Pursuant to the Agreement, the
Agreement terminated 60 days from 14 May 2020. On 13 July 2020, the Agreement was terminated.
On 7 August 2020, 408,662,207 listed options exercisable at $0.012 per share expired.
On 25 August 2020, the Company held a General Meeting where shareholders approved a consolidation of capital
on the basis that every twenty shares be consolidated into one share, and where this consolidation results in a
fraction of share being held, the Company be authorised to round that fraction down to the nearest whole share.
No other matters or circumstances have arisen since the end of the financial year which significantly affected or
may significantly affect the Company’s operations or the state of affairs of the Company in future financial years.
Likely Developments and Expected Results
The Company expects to maintain the present status and level of operation and hence there are no likely
unwarranted developments in the entity’s operations.
Environmental Issues
The Company is subject to environmental regulation in respect of its exploration activities in Peru and Australia.
The Company ensures the appropriate standard of environmental care is achieved and, in doing so, that it is aware
of and is in compliance with all environmental legislation. The directors of the Company are not aware of any
breach of environmental legislation for the year.
Proceedings on Behalf of the Company
No person has applied for leave of the Court to bring proceedings on behalf of the Company or intervene in any
proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for
all or any part of those proceedings. The Company was not a party to any such proceedings during the year.
Indemnification of Officers and Insurance Premiums
The Company has paid premiums to insure the directors against liabilities for costs and expenses incurred by them
in defending legal proceedings arising from their conduct while acting in the capacity of director of the Company,
other than conduct involving a wilful breach of duty in relation to the Company.
The premiums paid in respect of Directors’ and Officers’ insurance during the year amounted to $22,334 (2019:
$17,457). Insurance premiums have not been allocated to individual directors or key management personnel.
Options
At the date of this report, there are 35,802,744 (post-consolidation) unissued ordinary shares of Inca Minerals
Limited under option.
14
Directors’ Report (continued)
OPERATING AND FINANCIAL REVIEW (continued)
Risk Management
15
The Board is responsible for ensuring that risks and opportunities are identified in a timely manner and that
activities are aligned with the risks and opportunities identified by the Board.
Meetings of Directors
During the financial year, 4 meetings of directors were held. Attendances by each director were as follows:
Mr Ross Brown
Mr Gareth Lloyd
Mr Jonathan West
Board Meetings
No. of meetings
eligible to attend
Number
attended
4
4
4
4
4
4
REMUNERATION REPORT (AUDITED)
This report outlines the remuneration arrangements in place for directors and executives of the Company.
Remuneration Policy
The remuneration policy of Inca Minerals Limited aligns director and executive objectives with shareholder and
business objectives by providing a fixed remuneration component and, where the Board believes it appropriate,
may also include specific long-term incentives based on key performance areas affecting the Company’s ability to
attract and retain the best executives and directors to run and manage the Company.
The remuneration policy setting out the terms and conditions for the executive directors and other senior
executives was developed by the Board. All executives receive a base salary (which is based on factors such as
ability and experience). The Board reviews executive packages annually by reference to the economic entity’s
performance, executive performance, and comparable information from industry sectors and other listed
companies in similar industries. The performance of the executive directors is measured against the objective of
promoting growth in shareholder value.
The Board may exercise discretion in relation to approving incentives, bonuses, and options. The policy is designed
to attract the highest calibre of executives and reward them for performance that results in long-term growth in
shareholder wealth. Executives may, where the Board believes it appropriate, participate in employee share and
option arrangements.
The Board policy is to remunerate directors at market rates for comparable companies for time, commitment and
responsibilities. The Board determines payments to directors and regularly reviews their remuneration based on
market practice, duties and accountability. Independent external advice is sought when required. No external
advice was sought during the report period. The maximum aggregate amount of fees that can be paid to non-
executive directors is subject to approval by shareholders in a general meeting (currently $240,000 per annum).
Performance Based Remuneration
There was nil performance-based remuneration for the year ended 30 June 2020.
15
Directors’ Report (continued)
REMUNERATION REPORT (AUDITED) (continued)
Key management personnel service agreements
Details of the key conditions of service agreements for key management personnel are as follows:
16
Commencement
Date
Notice Period
Base Salary
Base Salary
Ross Brown1
1 March 2012
6 months
$255,708 per annum
Gareth Lloyd
Jonathan West
14 September
2012
21 January 2019
Nil
Nil
$50,000 per annum director
fees
$50,000 per annum director
fees
Termination
Payments
Provided2
The Company may
terminate
employment by
giving 6 months’
notice or 6 months
payment in lieu
None
None
1 Mr Brown is engaged as Managing Director under a contract of employment with the Company. In addition to his
base salary, Mr Brown was eligible to receive an additional $20,000 performance-based remuneration (excluding
superannuation), none of which became payable during the report period as the conditions had not been met.
2 Other than statutory entitlements.
At a General Meeting of the Company held on 31 May 2019, shareholders approved the ability for the Company to
undertake a future issue of directors’ remuneration-sacrifice shares to Mr Ross Brown, Mr Gareth Lloyd and Mr
Jonathan West. Any shares are to be issued in accordance with the Company’s Directors’ Remuneration-Sacrifice
Share Plan (Share Plan).
Under the Share Plan, the Company’s directors agreed to reduce their cash remuneration by up to 50% through the
issue of shares, in lieu of cash consideration. The reduction in cash consideration is for an amount up to $127,854
for Mr Brown, up to $25,000 for Mr Lloyd, and up to $25,000 for Mr West.
There are no other agreements with key management personnel.
(a) Key management personnel compensation
2020
Short-term benefits
Post-employment benefits
Total
Performance
related
compensation
as % of total
remuneration
Name
Salary and
fees
Other
Perfor-
mance
Bonus
Directors
Ross Brown
Gareth Lloyd
Jonathan
West
Executives
-
Totals
$
255,708
50,000
46,875*
-
352,583
$
-
-
-
-
-
$
3,000
-
-
-
3,000
Non-
monetary
benefits
$
Super-
annuation
Long
service
leave
$
$
-
-
-
-
-
22,992
3,266
2,227
-
28,485
(4,954)
-
-
-
-
-
-
(4,954)
-
0.0%
*Jonathan West agreed to forgo part of his remuneration for the year amounting to $3125.
Premiums of $22,334 were paid in relation to directors and officers liability insurance.
$
276,746
53,266
49,102
-
379,114
16
Directors’ Report (continued)
REMUNERATION REPORT (AUDITED) (continued)
17
2019
Short-term benefits
Post-employment benefits
Total
Performance
related
compensation
as % of total
remuneration
Name
Salary and
fees
Other
Perfor-
mance
Bonus
Directors
Ross Brown
Gareth Lloyd
Jonathan
West
Justin Walawski
Executives
-
Totals
$
255,708
50,000
20,833
244,650
-
571,191
$
-
-
-
-
-
-
$
3,600
-
-
2,114
-
5,714
Non-
monetary
benefits
$
Super-
annuation
Long
service
leave
$
$
-
-
-
-
-
-
24,438
4,750
1,979
15,209
-
46,376
34,228
-
-
-
-
-
-
34,228
-
0.0%
$
317,974
54,750
22,812
261,973
-
657,509
Premiums of $17,457 were paid in relation to directors and officers liability insurance.
b) Options and rights granted as remuneration
No options or rights were granted as remuneration during the year (2019: $nil).
c) Share Based Payments
During the year ended 30 June 2020, shares received by directors in lieu of cash consideration have been issued as
follows.
Director
Shares Issued
Ross Brown
Gareth Lloyd
Jonathan West
2,892,310
5,592,502
11,185,004
Total $ Value of Shares
Issued
$9,724
$9,375
$18,750
Accrued Salary & Fees at 30 June 2020
to be Received in Shares
$6,963
$6,250
$4,688
No other share-based payments were issued as key management personnel remuneration during the year (2019:
$nil).
Key Management Personnel Relevant Interests
The relevant interests of key management personnel in the capital of the Company at the date of this report is as
follows:
Director
Ross Brown
Gareth Lloyd
Jonathan West
Number of Ordinary Shares
39,304,072
5,592,502
45,250,000
Number of Options over Ordinary Shares
3,833,334
-
11,427,334
17
Directors’ Report (continued)
REMUNERATION REPORT (AUDITED) (continued)
18
The following tables show the movements in the relevant interests of key management personnel in the share
capital of the Company:
2020
Name
Ross Brown
Gareth Lloyd
Jonathan West
Totals
2019
Name
Ross Brown
Gareth Lloyd
Jonathan West
Justin Walawski
Totals
Opening balance
1 July 2019
35,911,762
-
17,000,000
52,911,762
Opening balance
1 July 2018
31,411,762
-
-
3,060,002
34,471,764
Additions /
Director
Appointment
3,392,310
5,592,502
28,250,000
37,234,812
Additions /
Director
Appointment
4,500,000
-
17,000,000
777,773
22,277,773
Disposals /
Director
Resignation
-
-
-
-
Disposals /
Director
Resignation
-
-
-
(3,837,775)
(3,837,775)
Closing balance 30
June 2020
39,304,072
5,592,502
45,250,000
90,146,574
Closing balance 30
June 2019
35,911,762
-
17,000,000
-
52,911,762
END OF REMUNERATION REPORT
Non-Audit Services
The Directors are satisfied that the provision of non-audit services during the year is compatible with the general
standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the
services disclosed below did not compromise the external auditor’s independence for the following reasons:
•
•
all non-audit services are reviewed and approved by the Board of Directors prior to commencement to ensure
they do not adversely affect the integrity and objectivity of the auditor; and
the nature of the services provided does not compromise the general principles relating to auditor
independence in accordance with APES 110: Code of Ethics for Professional Accountants set by the Accounting
Professional and Ethical Standards Board.
No non-audit services were provided by the entity’s auditor, Stantons International, as shown at Note 16.
Auditor’s Independence Declaration
We have obtained an Auditor’s Independence Declaration. Please refer to “Auditor’s Independence Declaration”
included on page 46 of the financial statements.
The Directors’ Report, incorporating the Remuneration Report, is signed in accordance with a resolution of the
Board of Directors.
Ross Brown
Director
Dated at Perth this 7th day of September 2020
18
Consolidated Statement of Profit and Loss and Other
Comprehensive Income
for the year ended 30 June 2020
19
Revenue
2
36,018
279,333
Note
2020
$
2019
$
Management and directors’ fees
Wages and salaries
Administrative expenses
Advertising and promotional costs
Professional fees
Listing and share registry expenses
Depreciation
Impairment of Peruvian Value Added Tax receivable
Foreign exchange (loss) / gain
Environmental rehabilitation
Exploration and evaluation expenditure written off
(Loss) before income tax
Income tax benefit
(Loss) after income tax
Other comprehensive income
7
3
(71,076)
(131,676)
(74,059)
(270,171)
(666,902)
(576,496)
-
(39,623)
(130,629)
(184,756)
(96,398)
(70,886)
(18,386)
(12,207)
(131,380)
(223,805)
(204,957)
(35,717)
(21,786)
(17,043)
(34,942)
(655,199)
(1,472,889)
(1,879,854)
-
-
(1,472,889)
(1,879,854)
Items that will not be reclassified to profit or loss
-
-
Items that may be reclassified subsequently to profit or
loss
Exchange differences on
operations, net of tax
Total comprehensive (loss)
translation of
foreign
(Loss) for the year attributable to members of Inca
Minerals Limited
Total comprehensive (loss) attributable to members of
Inca Minerals Limited
(379,011)
(1,851,900)
357,218
(1,522,636)
(1,472,889)
(1,879,854)
(1,851,900)
(1,522,636)
Basic and diluted (loss) per share (cents)
13
(0.04)
(0.07)
The accompanying notes form an integral part of these financial statements.
19
Consolidated Statement of Financial Position
as at 30 June 2020
20
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
Non-Current Assets
Plant and equipment
Exploration and evaluation expenditure
Right-of-use asset
Total Non-Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Lease liability
Trade and other payables
Provisions
Funding in advance
Total Current Liabilities
Non-Current Liabilities
Lease liability
Total Non-Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Accumulated losses
Foreign currency translation reserve
Share Option Reserve
TOTAL EQUITY
Note
14(b)
5
6
7
8(a)
8(e)
9(a)
9(b)
9(c)
8(e)
10
2020
$
2019
$
732,856
31,431
764,287
1,377,481
30,597
1,408,078
207.841
9,118,246
42,467
9,368,554
237,937
6,871,149
-
7,109,086
10,132,841
8,517,164
14,117
144,916
114,064
3,121,977
3,395,074
29,076
29,076
-
172,055
126,359
1,706,542
2,004,956
-
-
3,424,150
2,004,956
6,708,691
6,512,208
41,559,456
(34,748,899)
(134,717)
32,851
39,543,924
(33,276,010)
244,294
-
6,708,691
6,512,208
The accompanying notes form an integral part of these financial statements.
20
Consolidated Statement of Changes in Equity
for the year ended 30 June 2020
21
Contributed
Equity
Accumulated
Losses
Foreign
Currency
Translation
Reserve
Share Option
Reserve
Total
$
$
$
$
$
2019
Balance at 1 July 2018
Total comprehensive loss for the
year
37,270,506
(31,396,156)
(112,924)
-
(1,879,854)
357,218
Shares issued during the year
Cost of equity issue
2,401,111
(127,693)
-
-
-
-
Balance at 30 June 2019
39,543,924
(33,276,010)
244,294
2020
Balance at 1 July 2019
Total comprehensive loss for the
year
39,543,924
(33,276,010)
244,294
-
(1,472,889)
(379,011)
Shares issued during the year
2,305,469
Cost of equity issue
(289,937)
-
-
-
-
Balance at 30 June 2020
41,559,456
(34,748,899)
(134,717)
-
-
-
-
-
-
-
-
32,851
32,851
5,761,426
(1,522,636)
2,401,111
(127,693)
6,512,208
6,512,208
(1,851,900)
2,305,469
(257,086)
6,708,691
The accompanying notes form an integral part of these financial statements.
21
Consolidated Statement of Cash Flows
for the year ended 30 June 2020
22
Cash flows from operating activities
Payments to suppliers and employees
Interest received
Government grant received
Net cash (used in) operating activities
Cash flows from investing activities
Payments for exploration expenditures
Payments for plant and equipment
Net cash (used in) investing activities
Cash flows from financing activities
Proceeds from issue of shares (net of share issue
costs)
Proceeds from S32 under Share Subscription and
Earn-in Agreement
Repayment of lease liability
Proceeds received in advance for shares
Net cash from financing activities
Net increase/ (decrease) in cash held
Cash and cash equivalents at the beginning of
the financial year
Effect of exchange rate changes on cash and cash
equivalents
Cash and cash equivalents at the
end of the financial year
Note
14 (a)
2020
$
2019
$
(382,665)
1,089
20,694
(360,882)
(864,928)
1,151
-
(863,777)
(3,408,628)
(21,151)
(3,429,779)
(2,485,169)
(62,391)
(2,547,560)
1,823,615
2,232,759
1,356,466
(15,956)
-
3,164,125
1,718,791
-
43,500
3,995,050
(626,536)
583,713
1,377,481
789,315
(18,089)
4,453
14 (b)
732,856
1,377,481
The accompanying notes form an integral part of these financial statements.
22
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies
23
The financial report covers the Company of Inca Minerals Limited, a listed public company incorporated and
domiciled in Australia, and its controlled entities.
The financial report was authorised for issue on 7th September 2020 by the Board of Directors.
Basis of preparation
The financial report is a general purpose financial report that has been prepared in accordance with Australian
Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the
Australian Accounting Standards Board (AASB) and the Corporations Act 2001.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial
report containing relevant and reliable information about transactions, events and conditions. Compliance with
Australian Accounting Standards ensures that the financial statements and notes also comply with International
Financial Reporting Standards.
The financial report has been prepared on an accruals basis and is based on historical costs, modified, where
applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.
Going Concern
The financial statements have been prepared on the going concern basis, which contemplates continuity of normal
business activities and the realisation of assets and discharge of liabilities in the normal course of business.
For the year ended 30 June 2020, the Group incurred after tax losses of $1,472,889 (2019: loss of $1,879,854) and the
Group had net cash outflows of $626,536 (2019: net cash inflows of $583,713).
The Directors believe that it is reasonably foreseeable that the Company and Group will continue as a going concern
and that it is appropriate to adopt the going concern basis in the preparation of the financial report after consideration
of the following factors:
•
•
•
The Group has cash at bank at the reporting date of $732,856, a net working capital deficiency of $2,630,787 and
net assets of $6,708,691;
The ability of the Group to raise capital by the issue of additional shares under the Corporation Act 2001; and
The ability to curtail administration, operational and investing cash outflows as required.
Accounting Policies
The same accounting policies and methods of computation have been followed in this interim financial report as
were applied in the most recent annual financial statements, except for those as described below.
i)
New and Amended Standards Adopted by the Group
The Group has considered the implications of new and amended Accounting Standards which have become
applicable for the current financial reporting period. The Group had to change its accounting policies and make
adjustments as a result of adopting the following Standard:
-
AASB 16: Leases
23
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies (continued)
24
The Group as lessee
At inception of a contract the Group assesses if the contract contains or is a lease. If there is a lease present, a right-
of-use asset and a corresponding liability are recognised by the Group where the Group is a lessee. However, all
contracts that are classified as short-term leases (i.e. leases with a remaining lease term of 12 months or less) and
leases of low-value assets are recognised as an operating expense on a straight-line basis over the term of the
lease.
Initially, the lease liability is measured at the present value of the lease payments still to be paid at the
commencement date. The lease payments are discounted at the interest rate implicit in the lease. If this rate cannot
be readily determined, the Group uses incremental borrowing rate. The incremental borrowing rate was 5%.
Lease payments included in the measurement of the lease liability are as follows;
fixed lease payments less any lease incentives;
variable lease payments that depend on index or rate, initially measured using the index or rate at the
the amount expected to be payable by the lessee under residual value guarantees;
the exercise price of purchase options if the lessee is reasonably certain to exercise the options;
lease payments under extension options, if the lessee is reasonably certain to exercise the options; and
payments of penalties for terminating the lease, if the lease term reflects the exercise of options to
-
-
commencement date;
-
-
-
-
terminate the lease.
The right-of-use asses comprise the initial measurement of the corresponding lease liability, any lease payments
made at or before the commencement date and any initial direct costs. The subsequent measurement of the right-
of-use assets is at cost less accumulated depreciation and impairment losses.
Right-of-use assets are depreciated over the lease term or useful life of the underlying asset, whichever is the
shortest.
Where a lease transfers ownership of the underlying asset or the costs of the right-of-use asset reflects that the
Group anticipates to exercise a purchase option, the specific asset is depreciated over the useful life of the
underlying asset.
ii.
Initial Application of AASB 16: Leases
The Group has adopted AASB 16: Leases retrospectively with the cumulative effect of initially applying AASB 16
recognised as 1 July 2019. In accordance with AASB 16, the comparatives for the 2019 reporting period have not
been restated.
The Group has recognised a lease liability and right-of-use asset for all leases (with exception of short-term and low
value leases) recognised as operating leases under AASB 117: Leases where the Group is a lessee.
Lease liabilities are measured at the present value of the remaining lease payments. The Group’s incremental
borrowing rate as at 1 July 2019 was used to discount the lease payments.
The right-of-use assets were measured at their carrying values as if AASB 16 Leases had been applied since the
commencement date but discounted using the Group’s incremental borrowing rate per lease term as at 1 July 2019.
The right-of-use assets have been recognised in the statement of financial position as at 1 July 2019.
24
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies (continued)
25
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the year when the
asset is realised or the liability is settled, based on tax rates enacted or substantially enacted at reporting date.
Their measurement also reflects the manner in which management expects to recover or settle the carrying
amount of the related asset or liability. Deferred tax assets relating to temporary differences and unused tax losses
are recognised only to the extent that it is probable that future taxable profit will be available against which the
benefits of the deferred tax asset can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint
ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary
difference can be controlled and it is not probable that the reversal will occur in the foreseeable future.
Current tax assets and liabilities are offset where a largely enforceable right of set-off exists and it is intended that
net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred
tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax assets and
liabilities related to income taxes levied by the same taxation authority on either the same taxable entity or
different taxable entities where it is intended that net settlement or simultaneous realisation and settlement of
the respective asset and liability will occur in future periods in which significant amounts of deferred tax assets or
liabilities are expected to be recovered or settled.
a) Mining Tenements and Exploration and Evaluation Expenditure
Mining tenements are carried at cost, less accumulated impairment losses.
Exploration, evaluation and development 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 and/or sale of the area or where activities in the area have not yet reached a stage that
permits reasonable assessment of the existence of economically recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit or loss in the year in which
the decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest are amortised over the life
of the area according to the rate of depletion of the economically recoverable reserves.
d)
Mining Tenements and Exploration and Evaluation Expenditure (continued)
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest.
Costs of site restoration are provided for over the life of the facility from when exploration commences and are
included in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant,
equipment and building structures, waste removal, and rehabilitation of the site in accordance with clauses of the
mining permits. Such costs are determined using estimates of future costs, current legal requirements and
technology on an undiscounted basis.
Any changes in the estimates for the costs are accounted for on a prospective basis. In determining the costs of site
restoration, there is uncertainty regarding the nature and extent of the restoration due to community expectations
and future legislation. Accordingly, the costs have been determined on the basis that the restoration will be
completed within one year of abandoning the site.
25
26
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies (continued)
e) Financial Instruments
Recognition and derecognition
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual
provisions of the financial instrument.
Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or
when the financial asset and substantially all the risks and rewards are transferred.
A financial liability is derecognised when it is extinguished, discharged, cancelled or expires.
Classification and initial measurement of financial assets
Except for those trade receivables that do not contain a significant financing component and are measured at the
transaction price in accordance with AASB 15, all financial assets are initially measured at fair value adjusted for
transaction costs (where applicable).
Financial assets, other than those designated and effective as hedging instruments, are classified into the following
categories:
•
•
•
amortised cost
fair value through profit or loss (FVTPL)
fair value through other comprehensive income (FVOCI).
In the periods presented the corporation does not have any financial assets categorised as FVOCI.
The classification is determined by both:
•
•
the entity’s business model for managing the financial asset
the contractual cash flow characteristics of the financial asset.
All income and expenses relating to financial assets that are recognised in profit or loss are presented within
finance costs, finance income or other financial items, except for impairment of trade receivables which is
presented within other expenses.
Subsequent measurement of financial assets
Financial assets at amortised cost
Financial assets are measured at amortised cost if the assets meet the following conditions (and are not designated
as FVTPL):
- they are held within a business model whose objective is to hold the financial assets and collect its contractual cash
flows
- the contractual terms of the financial assets give rise to cash flows that are solely payments of principal and interest
on the principal amount outstanding.
After initial recognition, these are measured at amortised cost using the effective interest method.
26
27
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies (continued)
Discounting is omitted where the effect of discounting is immaterial. The Group’s cash and cash equivalents, trade
and most other receivables fall into this category of financial instruments as well as listed bonds that were
previously classified as held-to-maturity under AASB 139.
Financial assets at fair value through profit or loss (FVTPL)
Financial assets that are held within a different business model other than ‘hold to collect’ or ‘hold to collect and
sell’ are categorised at fair value through profit or loss. Further, irrespective of business model financial assets
whose contractual cash flows are not solely payments of principal and interest are accounted for at FVTPL. All
derivative financial instruments fall into this category, except for those designated and effective as hedging
instruments, for which the hedge accounting requirements apply.
The category also contains an equity investment. The Group accounts for the investment at FVTPL and did not
make the irrevocable election to account for the investment in unlisted and listed equity securities at fair value
through other comprehensive income (FVOCI). The fair value was determined in line with the requirements of AASB
9, which does not allow for measurement at cost.
Assets in this category are measured at fair value with gains or losses recognised in profit or loss.
The fair values of financial assets in this category are determined by reference to active market transactions or
using a valuation technique where no active market exists.
Financial assets at fair value through other comprehensive income (FVOCI)
The Group accounts for financial assets at FVOCI if the assets meet the following conditions:
•
•
they are held under a business model whose objective it is “hold to collect” the associated cash flows and
sell and
the contractual terms of the financial assets give rise to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
Any gains or losses recognised in other comprehensive income (OCI) will be recycled upon derecognition of the
asset.
Impairment of financial assets
AASB 9’s impairment requirements use more forward-looking information to recognise expected credit losses –
the ‘expected credit loss (ECL) model’. This replaced AASB 139’s ‘incurred loss model’.
Instruments within the scope of the new requirements included loans and other debt-type financial assets
measured at amortised cost and FVOCI, trade receivables, contract assets recognised and measured under AASB
15 and loan commitments and some financial guarantee contracts (for the issuer) that are not measured at fair
value through profit or loss.
Recognition of credit losses is no longer dependent on the Group first identifying a credit loss event. Instead the
Group considers a broader range of information when assessing credit risk and measuring expected credit losses,
including past events, current conditions, reasonable and supportable forecasts that affect the expected
collectability of the future cash flows of the instrument.
27
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies (continued)
28
In applying this forward-looking approach, a distinction is made between:
•
financial instruments that have not deteriorated significantly in credit quality since initial recognition or that
have low credit risk (‘Level 1’) and
•
financial instruments that have deteriorated significantly in credit quality since initial recognition and whose
credit risk is not low (‘Level 2’).
‘Stage 3’ would cover financial assets that have objective evidence of impairment at the reporting date.
‘12-month expected credit losses’ are recognised for the first category while ‘lifetime expected credit losses’ are
recognised for the second category.
Measurement of the expected credit losses is determined by a probability-weighted estimate of credit losses over
the expected life of the financial instrument.
Trade and other receivables and contract assets
The Group makes use of a simplified approach in accounting for trade and other receivables as well as contract
assets and records the loss allowance as lifetime expected credit losses. These are the expected shortfalls in
contractual cash flows, considering the potential for default at any point during the life of the financial instrument.
In calculating, the Group uses its historical experience, external indicators and forward-looking information to
calculate the expected credit losses using a provision matrix.
The Group assess impairment of trade receivables on a collective basis as they possess shared credit risk
characteristics they have been grouped based on the days past due.
Classification and measurement of financial liabilities
The Group’s financial liabilities include borrowings, trade and other payables and derivative financial instruments.
Financial liabilities are initially measured at fair value, and, where applicable, adjusted for transaction costs unless
the Group designated a financial liability at fair value through profit or loss.
Subsequently, financial liabilities are measured at amortised cost using the effective interest method except for
derivatives and financial liabilities designated at FVTPL, which are carried subsequently at fair value with gains or
losses recognised in profit or loss (other than derivative financial instruments that are designated and effective as
hedging instruments).
All interest-related charges and, if applicable, changes in an instrument’s fair value that are reported in profit or
loss are included within finance costs or finance income.
f)
Impairment of Assets
At each reporting date, the entity reviews the carrying values of its tangible and intangible assets to determine
whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable
amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the
asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to profit
or loss.
28
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies (continued)
29
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset for which the estimates of future
cash flows have not been adjusted.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the
asset is reduced to its recoverable amount. An impairment loss is recognised in profit or loss immediately, unless
the relevant asset is carried at fair value, in which case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised
estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed
the carrying amount that would have been determined had no impairment loss been recognised for the asset in
prior years. A reversal of an impairment loss is recognised in profit or loss immediately, unless the relevant asset is
carried at fair value, in which case the reversal of the impairment loss is treated as a revaluation increase.
g) Plant and Equipment
Plant and equipment are measured on the cost basis and therefore carried at cost less accumulated depreciation
and any accumulated impairment. In the event the carrying amount of plant and equipment is greater than the
estimated recoverable amount, the carrying amount is written down immediately to the estimated recoverable
amount and impairment losses are recognised either in profit or loss or as a revaluation decrease if the impairment
losses relate to a revalued asset.
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash
flows that will be received from the asset’s employment and subsequent disposal. The expected net cash flows
have been discounted to their present values in determining recoverable amounts.
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 Company and the
cost of the item can be measured reliably. All other repairs and maintenance are charged to the statement of
comprehensive income during the financial period in which they are incurred.
Depreciation
The depreciable amount of all fixed assets is depreciated on a straight-line basis over the asset’s useful life to the
Company commencing from the time the asset is held ready for use. The depreciation rates used for each class
of depreciable assets are:
Class of fixed asset
Plant and equipment
Motor vehicles
IT equipment
Leasehold improvements
10–33%
20–33%
10-33%
20%
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 gains and
losses are included in the profit or loss.
29
30
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies (continued)
h)
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand and deposits held at call with banks.
i)
Goods and Services Tax
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred
is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost
of acquisition of the asset or as part of an item of the expense. Receivables and payables in the statement of
financial position are shown inclusive of GST. Cash flows are presented in the statement of cash flows on a gross
basis, except for the GST component of investing and financing activities, which are disclosed as operating cash
flows.
j)
Contributed 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. Incremental costs directly attributable to the issue of new shares or options for the
acquisition of a business are not included in the cost of the acquisition as part of the purchase consideration.
k) Earnings per Share
(i) Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company, excluding
any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
outstanding during the financial year.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into
account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary
shares and the weighted average number of shares assumed to have been issued for no consideration in relation to
dilutive potential ordinary shares.
l)
Leases
Leases of fixed assets, where substantially all the risks and benefits incidental to the ownership of the asset, but
not the legal ownership that are transferred to the economic entity, are classified as finance leases.
Finance leases are capitalised by recording an asset and a liability at the lower of the amounts equal to the fair
value of the leased property or the present value of the minimum lease payments, including any guaranteed
residual values. Lease payments are allocated between the reduction of the lease liability and the lease interest
expense for the period.
Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful lives or the lease
term. Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor,
are charged as expenses in the periods in which they are incurred.
30
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies (continued)
l) Employee Benefits
31
Provision is made for the Company’s liability for employee benefits arising from services rendered by employees
to reporting date. Employee benefits that are expected to be settled within one year have been measured at the
amounts expected to be paid when the liability is settled, plus related on-costs. Employee benefits payable later
than one year have been measured at the present value of the estimated future cash outflows to be made for
those benefits.
m) 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.
n)
Trade and Other Receivables
Trade and other receivables include amounts due from customers for goods sold and services performed in the
ordinary course of business. Receivables expected to be collected within 12 months of the end of the reporting
period are classified as current assets. All other receivables are classified as non-current assets.
Trade and other receivables are initially recognised at fair value and subsequently measured at amortised cost using
the effective interest method, less any provision for impairment.
o) Trade and Other Payables
Trade and other payables represent the liabilities for goods and services received by the entity that remain unpaid
at the end of the reporting period. The balance is recognised as a current liability with the amounts normally paid
within 30 days of recognition of the liability.
p)
Foreign Currency Transactions Balances
Functional and presentation currency
The functional currency of each of the Group’s entities is measured using the currency of the primary economic
environment in which that entity operates. The consolidated financial statements are presented in Australian
dollars, which is the parent entity’s functional currency.
Transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the
date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-
monetary items measured at historical cost continue to be carried at the exchange rate at the date of the
transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair
values were determined.
Exchange differences arising on the translation of monetary items are recognised in profit or loss, except where
deferred in equity as a qualifying cash flow or net investment hedge. Exchange differences arising on the
translation of non-monetary items are recognised directly in other comprehensive income to the extent that the
underlying gain or loss is recognised in other comprehensive income; otherwise the exchange difference is
recognised in profit or loss.
31
Notes To The Financial Statements
For the year ended 30 June 2020
Note 1: Statement of Significant Accounting Policies (continued)
Group companies
32
The financial results and position of foreign operations, whose functional currency is different from the Group’s
presentation currency, are translated as follows:
•
•
•
assets and liabilities are translated at exchange rates prevailing at the end of the reporting period;
income and expenses are translated at average exchange rates for the period; and
retained earnings are translated at the exchange rates prevailing at the date of the transaction.
Exchange differences arising on translation of foreign operations with functional currencies other than Australian
dollars are recognised in other comprehensive income and included in the foreign currency translation reserve in
the statement of financial position. These differences are recognised in profit or loss in the period in which the
operation is disposed of.
m) Critical Accounting Estimates and Other Accounting Judgements
Estimates and judgements are continually evaluated and are based on historical experience and other factors,
including expectations of future events that are believed to be reasonable under the circumstances.
The Company is of the view that there are no critical accounting estimates and judgements in this financial report,
other than accounting estimates and judgements in relation to the carrying value of mineral exploration expenditure.
Key judgements
Deferred exploration and evaluation expenditure
Exploration and evaluation costs are carried forward where right of tenure of the area of interest is current. These
costs are carried forward in respect of an area that has not at reporting date reached a stage that permits reasonable
assessment of the existence of economically recoverable reserves, or alternatively, are expected to be sold. Refer to
the accounting policy stated in Note 1(d).
Deferred taxation
The potential deferred tax asset arising from the tax losses and temporary differences have not been recognised as
an asset because in the directors’ judgement, it is not probable that the Company will make taxable profits against
which the tax losses can be recovered.
s)
Comparative Figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
Note 2: Revenue
Interest received
Government grant received
Income received under option agreement
Consolidated
2020
$
1,100
34,918
-
36,018
2019
$
1,345
277,988
279,333
32
Notes To The Financial Statements
For the year ended 30 June 2020
Note 3: Income Tax
(a)
Income tax recognised in profit
No income tax is payable by the Company as it recorded losses for income tax purposes for the year.
(b) Numerical reconciliation between income tax expense and the loss before income tax.
33
Loss before income tax
Income tax at 27.5% (2019: 27.5%)
Tax effect of:
Deferred tax asset not recognised
Movement in unrecognised temporary differences
Tax effect of permanent differences
Income tax benefit
(c) Unrecognised deferred tax balances
Revenue tax losses available to the Company
Capital tax losses available to the Company
Total tax losses available to the Company
Potential tax benefit at 27.5% (2019: 27.5%)
Consolidated
2020
$
(1,472,889)
(405,045)
510,590
(96,035)
(414,555)
-
2019
$
(1,879,854)
(516,960)
598,698
(98,464)
(500,234)
-
28,315,337
1,235
28,316,572
26,689,724
-
26,689,724
7,787,057
7,339,674
A deferred tax asset attributable to income tax losses has not been recognised at reporting date as the probability
criteria disclosed in Note 1(c) is not satisfied and such benefit will only be available if the conditions of deductibility,
also disclosed in Note 1(c), are satisfied.
Note 4: Dividends
No dividends were paid or declared since the start of the financial year. No recommendation for payment of dividends
has been made.
Note 5: Trade and Other Receivables
Current
Other receivables
Prepayments
None of the trade and other receivables are past due date.
Consolidated
2020
$
29,166
2,265
31,431
2019
$
21,891
8,706
30,597
33
Notes To The Financial Statements
For the year ended 30 June 2020
Note 6: Plant and Equipment
34
Plant and
equipment
IT
equipment
$
Leasehold
Improvements
$
$
Total
$
Balance at 1 July 2018
Additions / (disposals) and writeoffs
Depreciation / writeback
on disposals*
201,509
60,278
2,794
-
1,385
(694)
205,688
59,584
(25,282)
(1,362)
(691)
(27,335)
Balance at 30 June 2019
236,505
1,432
-
237,937
At cost
Accumulated depreciation
338,275
(101,770)
21,848
(20,416)
6,213
(6,213)
Balance at 30 June 2019
236,505
1,432
Balance at 1 July 2019
Additions / (disposals) and writeoffs
Depreciation / writeback
on disposals*
236,505
11,405
1,432
-
(40,069)
(1,432)
Balance at 30 June 2020
207,841
-
-
-
-
-
-
366,336
(128,399)
237,937
237,937
11,405
(41,501)
207,841
At cost
Accumulated depreciation
349,680
(141,839)
21,848
(21,848)
6,213
(6,213)
377,741
(169,900)
Balance at 30 June 2020
207,841
-
-
207,841
* Inclusive of depreciation capitalised to exploration and evaluation expenditure.
Note 7: Exploration and Evaluation Expenditure
Costs carried forward in respect of areas of interest in the following phases:
Exploration and evaluation phase – at cost
Balance at 1 July
Expenditure incurred (including exchange rate movements)
Expenditure written off
Balance at 30 June
Consolidated
2020
$
2019
$
6,871,149
2,268,883
(21,786)
5,307,999
2,218,349
(655,199)
9,118,246
6,871,149
34
Notes To The Financial Statements
For the year ended 30 June 2020
Note 8: Right-of-use Asset and Lease Liability
35
The Company’s lease portfolio includes the office lease, The average term of the lease is 1-2 years with an option
to extend for an additional 2 years.
(a): Carrying value
Balance at inception of the lease
Accumulated depreciation
Consolidated
2020
$
56,623
(14,156)
42,467
2019
$
-
-
-
(b): AASB 16 related amounts recognised in the Statement of Profit or Loss and Other Comprehensive Income
Depreciation expense
Interest expense (included in administrative expenses)
(c): Total cash outflows for leases
Repayment of lease liabilities
(d): Option to extend or terminate
Consolidated
2020
$
14,156
2,526
16,682
2019
$
-
-
-
Consolidated
2020
$
(15,956)
2019
$
-
The Company uses high sight in determining the lease term where the contract contains options to extend or
terminate the lease.
(e): Lease liability
Consolidated
Recognised on 1 July 2019
Less: principal repayments
Add: interest expense on lease liability
Current lease liability
Non-current lease liability
2020
$
56,623
(15,956)
2,526
43,193
14,117
29,076
2019
$
-
-
-
35
Notes To The Financial Statements
For the year ended 30 June 2020
Note 9(a): Trade and Other Payables (current)
36
Trade and other creditors
Accrued liabilities
Share capital funds received in advance
None of the payables are past due date.
Note 9(b): Provisions (current)
Annual leave
Long service leave
Note 9(c): Funding in Advance (current)
Funding received under Share Subscription Agreement and Earn-In
Agreement with South32*
Consolidated
2020
$
104,911
40,005
-
144,916
2019
$
107,009
21,546
43,500
172,055
Consolidated
2020
$
75,157
38,907
114,064
2019
$
92,131
34,228
126,359
Consolidated
2020
$
2019
$
3,121,977
3,121,977
1,706,542
1,706,542
*Under the terms of the Share Subscription and Earn-In Agreement (Agreement) with South32 Group Operations
Pty Ltd (South32) dated 29 March 2019, this amount represents funding received from South32 in relation to project
expenditure that the Company must incur on the Greater Riqueza Project held by its 100% subsidiary Brillandino
Minerales S.A.C. (Brillandino).
The Company received written notification dated 14 May 2020 from South 32, that pursuant to the Agreement,
South 32 exercised its right to withdrawn from the Project held by Brillandino. Pursuant to the Agreement, the
Agreement shall terminate 60 days from 14 May 2020. The funding provided is not refundable to South 32.
Refer to note 19 Subsequent Events as well as note 21 for contractual obligations in relation to the Agreement
36
Notes To The Financial Statements
For the year ended 30 June 2020
Note 10: Contributed Equity
a) Paid up capital
4,078,233,994 ordinary shares (30 June 2019: 3,085,600,366 ordinary shares)
b) Movements in shares on issue
Balance at 30 June 2018
Issued 2 August 2018
Issued 5 September 2018
Issued 19 September 2018
Issued 1 October 2018
Issued 22 October 2018
Issue 7 November 2018
Issued 3 December 2018
Issued 7 December 2018
Issued 7 December 2018
Issued 13 March 2019
Issued 13 March 2019
Issued 2 May 2019
Issued 2 May 2019
Issued 5 June 2019
Issued 5 June 2019
Transaction costs from issue of shares
Balance at 30 June 2019
Issued 4 July 2019
Issued 22 August 2019
Issued 2 October 2019
Issued 30 October 2019
Issued 19 November 2019
Issued 19 November 2019
Issued 7 January 2020
Selective buy-back 9 January 2020
Issued 6 April 2020
Transaction costs from issue of shares
Balance at 30 June 2020
c) Movements in options on issue
37
Consolidated
2020
$
2019
$
41,559,456
39,543,924
No of shares
2,592,788,159
27,500,000
136,128,818
32,961,000
12,900,000
9,875,000
10,000,000
143,292,389
1,540,000
12,950,000
13,450,000
25,150,000
46,640,000
14,925,000
3,000,000
2,500,000
-
3,085,600,366
8,750,000
40,000,000
5,680,813
966,087,592
46,000,000
8,700,000
11,788,223
(110,000,000)
15,627,000
-
4,078,233,994
Paid up capital
$
37,270,506
137,500
680,644
164,805
64,500
39,500
50,000
716,462
7,700
51,800
67,250
102,750
233,200
60,000
15,000
10,000
(127,693)
39,543,924
43,750
150,000
19,099
1,932,175
94,733
26,133
23,952
-
15,627
(289,937)
41,559,456
In relation to listed options exercisable at $0.012 per option at any time up to 7 August 2020, there were 8,750,000
options issued during the year, and 408,662,207 options outstanding over unissued ordinary shares on issue at 30 June
2020.
I In relation to listed options exercisable at $0.007 per option at any time up to 31 October 2022, there were 716,058,395
options issued during the year, and 716,058,395 options outstanding over unissued ordinary shares on issue at 30 June
2020.
d) Ordinary shares
Ordinary shares have the right to receive dividends as declared and, in the event of winding up of the Company, to
participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on
shares held.
37
Notes To The Financial Statements
For the year ended 30 June 2020
Note 11: Interests of Key Management Personnel
a) Key management personnel compensation
38
Refer to the Remuneration Report contained in the Director’s Report for details of the remuneration paid to each
member of the Company’s key management personnel for the year ended 30 June 2020. The totals of remuneration
paid to key management personnel of the Company during the year are as follows:
Short-term employee benefits (i)
Post-employment benefits (ii)
(i) Includes payments for salaries, director fees, consulting fees and allowances.
(ii) Includes superannuation contributions and long service leave entitlements.
b) Key management personnel shareholdings
Consolidated
2020
$
350,629
28,485
379,114
2019
$
576,905
80,604
657,509
The number of ordinary shares in Inca Minerals Limited held by key management personnel of the Company during
the financial year is as follows:
2020
Name
Ross Brown
Gareth Lloyd
Jonathan West
Totals
2019
Name
Ross Brown
Gareth Lloyd
Jonathan West
Justin Walawski
Totals
Opening balance
1 July 2019
35,911,762
-
17,000,000
52,911,762
Opening balance
1 July 2018
31,411,762
-
-
3,060,002
34,471,764
Additions /
Director
Appointment
3,392,310
5,592,502
28,250,000
37,234,812
Additions /
Director
Appointment
4,500,000
-
17,000,000
777,773
22,277,773
Disposals /
Director
Resignation
-
-
-
-
Disposals /
Director
Resignation
-
-
-
(3,837,775)
(3,837,775)
Closing balance 30
June 2020
39,304,072
5,592,502
45,250,000
90,146,574
Closing balance 30
June 2019
35,911,762
-
17,000,000
-
52,911,762
Note 12: Related Party Transactions
During the year ended 30 June 2020, shares received by directors in lieu of cash consideration have been issued as
follows.
Director
Shares Issued
Ross Brown
Gareth Lloyd
Jonathan West
2,892,310
5,592,502
11,185,004
Total $ Value of Shares
Issued
$9,724
$9,375
$18,750
Accrued Salary & Fees at 30 June 2020
to be Received in Shares
$6,963
$6,250
$4,688
38
Notes To The Financial Statements
For the year ended 30 June 2020
Note 12: Related Party Transactions (continued)
39
On 19 November 2019, Mr Jonathan West was issued 8,700,000 fully paid ordinary shares at $0.003 in relation to
expenses incurred in the identification, development and exploration of a number of projects in the Northern
Territory, being the Frewena projects, which were acquired by the Company. The total fair value of the shares issued
was $26,133.
There were no other transactions and balances with directors and other key management personnel.
Note 13: Loss Per Share
a) Basic Earnings Per Share
Consolidated
2020
$
2019
$
Loss used in calculating basic earnings per share
(1,472,889)
(1,879,854)
Weighted average number of ordinary shares on issue during the year used as
the denominator in calculating basic loss per share
3,767,265,224
2,889,474,545
Basic loss per share (cents)
b) Diluted loss per share (cents)
(0.04)
(0.07)
Diluted loss per share is the same as basic loss per share as the Company is in a loss making position.
Note 14: Cash Flow Information
a) Reconciliation of the net loss after income tax to the net cash flows from
operating activities
Consolidated
Net loss for the year
Depreciation
Impairment of Peruvian value added tax
Foreign exchange (gains) / losses
Exploration and evaluation expenditure written off
Peruvian capitalised exploration expenditure
Professional fees paid in share capital
Interest on lease liability
Changes in assets and liabilities
(Increase) / decrease in trade and other receivables
Increase / (decrease) in trade and other payables
Increase / (Decrease) in provisions
Increase / (Decrease) in income received in advance
Net cash outflow from operating activities
(b) Reconciliation of cash and cash equivalents
2020
$
(1,472,889)
18,386
131,380
204,957
21,786
773,240
-
2,526
(834)
(27,139)
(12,295)
-
(360,882)
2019
$
(1,879,854)
12,207
223,805
17,043
655,199
332,082
49,500
-
93,934
(130,592)
40,887
(277,988)
(863,777)
Cash balance comprises: cash assets
732,856
1,377,481
(c) Non-cash financing activities
On 19 November 2019, the Company issued 46,000,000 fully paid ordinary shares at $0.0206 for a total value of
$94,733 as payment for services provided to the Company.
39
Notes To The Financial Statements
For the year ended 30 June 2020
Note 15: Expenditure Commitments
40
The Group has certain commitments to meet minimum expenditure requirements on the mineral exploration assets
in which it has an interest. These commitments are optional and only required if the Company wishes to maintain its
rights of earn-in or rights of tenure. Outstanding exploration commitments for not later than one year and for
between one and five years are as follows:
Not later than one year
Between one and five years
Consolidated
2020
$
Consolidated
2019
$
1,492,082
5,993,580
7,485,662
791,786
5,211,435
6,003,221
The exploration expenditure commitments above include commitments related to agreements for the acquisition of
interests in mining concessions pertaining to the Group’s Greater Riqueza (Riqueza) and Cerro Rayas projects in Peru.
As at 30 June 2020 the Group has met all its obligations in respect of the agreements and all future exploration
commitments are payable at the Group’s discretion and dependent upon the Group acquiring the exclusive rights to
the mining concessions. The key terms of the agreements pertaining to concessions within the Riqueza and Cerro
Rayas projects are set out below.
1. Riqueza Project: A 5-year mining concession transfer option and assignment agreement granting the Group the
exclusive option to acquire 100% interest in a mining concession called Nueva Santa Rita and referred to as the Riqueza
Project. The Group has the exclusive right to terminate at any time during the transfer option and assignment period
and any unpaid amounts are not payable to the vendor.
On 31 October 2018, 17 May 2019 and 7 July 2020, the Group executed addendums to the option and assignment
agreement extending the payment timing. The total consideration payable has been increased in US$15,000. The
addendum extended the assignment period to 6 years from the commencement date.
Other key terms are:
Total Mining Concession Transfer Option
& Assignment (MCTOA) Consideration
US$1,798,000:
- US$10,000 (Mining Assignment); and,
- US$1,788,000 (Mining Option).
Payment
Consideration
Timing
of
MCTOA
Mining Assignment Payment (MAP):
MAP Payment on Execution Date (ED): US$10,000*
Mining Transfer Option Payments (MTOP):
MTOP Payment on ED: US$30,000*
MTOP Payment 6 months from ED: US$20,000*
MTOP Payment 12 months from ED: US$50,000*
MTOP Payment 18 months from ED: US$60,000*
MTOP Payment 24 months from ED: US$50,000*
MTOP Payment on or before November 15, 2018: US$31,500*
MTOP Payment on or before December 15, 2018: US$31,500*
MTOP Payment on or before 20 May 2019: US$10,000*
MTOP Payment on or before 20 June 2019: US$20,000*
MTOP Payment on or before 20 July 2019: US$70,000*
40
Notes To The Financial Statements
For the year ended 30 June 2020
Note 15: Expenditure Commitments (continued)
41
MTOP Payment 42 months from ED: US$100,000*
MTOP Payment on or before 30 May 2020: US$15,000*
MTOP Payment on or before 30 September 2020: US$30,000
MTOP Payment on or before 30 December 2020: US$30,000
MTOP Payment on or before 30 January 2021: US$30,000
MTOP Payment 60 months from ED: US$170,000
MTOP Payment 66 months from ED: US$520,000
MTOP Payment 72 months from ED: US$520,000
6 years from the Execution Date (19 May 2016).
2% NSR. The Group has a 20-year option to buy back 50% of the
NSR for US$1,000,000 leaving a 1% NSR to the vendor.
The Group has the exclusive right to terminate at any time during
the option and assignment period without cost or penalty. Any
unpaid amounts are not payable to the vendor.
Mining assignment period
NSR Royalty
Cancellability
* As at the date of the Directors’ Declaration, the Group has met all applicable commitments under the agreement.
2. Cerro Rayas Project - La Elegida Concession: A 2-year mining concession transfer option and assignment
agreement commencing 30 June 2017 granting the Group the exclusive option to acquire 100% interest in a mining
concession known as La Elegida which forms part of the Group’s Cerro Rayas Project. The Group has the exclusive
right to terminate at any time during the transfer option and assignment period and any unpaid amounts are not
payable to the vendor.
On 17 July 2017, 10 April 2019 and 2 July 2020, the Group executed addendums to the option and assignment
agreement extending the payment timing. The total consideration payable remains unchanged. The addendum
extended the assignment period to 38 months from the commencement date.
In addition, on 28 April 2020, the Group notified the decision to exercise the Mining Option. On 2 July 2020, the Group
acquired 100% of La Elegida Concession.
Other key terms are:
Total Mining Concession Transfer Option
and Assignment (MCTOA) Consideration
- US$245,000:US$1,000 (Mining Assignment); and,
- US$244,000 (Mining Option).
Payment Timing of MCTOA Consideration Mining Assignment Payment (MAP):
MAP on Commencement Date (CD): US$1,000*
Mining Transfer Option Payment (MTOP):
MTOP on CD: US$5,000*
MTOP on or before 6 months from CD: US$11,000*
MTOP on or before 12 months from CD: US$90,000*
MTOP on or before 13 – 19 months from CD: US$4,000 per month.
These payments total USD28,000*
MTOP on 2 April 2019: US$4,000*
MTOP on or before 22 months from CD: US$2,500*
MTOP on or before 23 months from CD: US$2,500*
41
Notes To The Financial Statements
For the year ended 30 June 2020
Note 15: Expenditure Commitments (continued)
42
Mining assignment period
MTOP on or before 24 – 32 months from CD:
US$4,000 per month. These payments
total
USD36,000*
MTOP on or before 33 months from CD: US$10,000*
MTOP on or before 34 months from CD: US$5,000*
MTOP on or before 38 months from CD: US$5,000*
38 months from the Commencement Date (30 June
2017).
* As at the date of the Directors’ Declaration, the Group has met all applicable commitments under the agreement.
3. Cerro Rayas Project - La Elegida I Concession: A 2.5-year mining concession transfer option and assignment
agreement commencing 10 October 2016 granting the Group the exclusive option to acquire 100% interest in a mining
concession known as La Elegida I which forms part of the Group’s Cerro Rayas Project. The Group had the exclusive
right to terminate at any time during the transfer option and assignment period and any unpaid amounts are not
payable to the vendor. The group exercised its right to early terminate the agreement, through a letter dated February
27, 2019. On 27 June 2019, the Group lodged with the Lima Registry Office the termination of the agreement and has
no further rights or obligations pursuant to the agreement.
In addition to exploration expenditure commitments the Group has certain operating commitments pertaining to
non-cancellable operating leases and agreements contracted for but not recognised in the financial statements:
Not later than one year
Between one and five years
Note 16: Auditor’s Remuneration
Statutory audit by auditor of the parent company
Audit and review of financial statements of parent entity
Audit and review of financial statements of subsidiary entity
Statutory audit by auditor of Inca Minerales S.A.C. and Brillandino
Minerales S.A.C.
Other services by auditor of Inca Minerales S.A.C. and Brillandino
Minerales S.A.C.
Consolidated
2020
$
Consolidated
2019
$
39,109
35,102
74,211
38,618
52,654
91,272
Consolidated
2020
$
29,937
-
29,937
12,068
-
12,068
42,005
Consolidated
2019
$
29,100
500
29,600
14,687
2,139
16,826
46,426
42
Notes To The Financial Statements
For the year ended 30 June 2020
Note 17: Segment Information
43
The Company 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 Company operates in the segments of mineral exploration within Peru and Australia. The Company is
domiciled in Australia. All revenue from external parties is generated from Australia only. Segment revenues are
allocated based on the country in which the party is located. Operating revenues of approximately Nil (2019: Nil) are
derived from a single external party. All the assets are located in Peru and Australia. Segment assets are allocated to
countries based on where the assets are located.
Reportable segments:
Segment revenue
2020
2019
Segment result
2020
2019
Segment assets
2020
2019
Segment liabilities
2020
2019
Depreciation and amortisation expense
2020
2019
Australia
$
36,018
279,333
(548,614)
(515,928)
1,067,584
227,598
(184,794)
(188,181)
(15,777)
(2,938)
Peru
$
-
-
(924,275)
(1,363,926)
9,065,297
8,289,566
Consolidated
$
36,018
279,333
(1,472,889)
(1,879,854)
10,132,881
8,517,164
(3,239,356)
(1,816,775)
(3,424,150)
(2,004,956)
(2,609)
(9,269)
(18,386)
(12,207)
Note 18: Financial Risk Management Objectives and Policies
(a)
Interest rate risk
The Company’s exposure to interest rate risk which is the risk that a financial instruments value will fluctuate as a
result of changes in market interest rates and the effective weighted average interest rate for each class of financial
assets and financial liabilities as set out below:
Weighted
average
interest
rate (%)
Non-
interest
bearing
Floating
interest
rate
$
$
Fixed interest
maturing
1 year or less
$
Fixed interest
maturing
1 to 5 years
$
30 June 2020
Cash and cash
equivalents
30 June 2019
Cash and cash
equivalents
0.11
76,858
635,998
20,000
0.06
1,183,293
174,188
20,000
-
-
Total
$
732,856
1,377,481
43
44
Notes To The Financial Statements
For the year ended 30 June 2020
Note 18: Financial Risk Management Objectives and Policies (continued)
(b) Interest rate sensitivity analysis
At 30 June 2020, if interest rates had changed by 25 basis points during the entire year with all other variables held
constant, profit for the year and equity would have been $2,638 higher/lower (2019: $2,708), mainly as a result of
higher/lower interest income from cash and cash equivalents.
A 25-basis point increase or decrease is used when reporting interest rate risk internally to key management personnel
and represents management’s assessment of the possible change in interest rates.
(c) Credit risk
The maximum exposure to credit risk at reporting date on financial assets of the Company is the carrying amount, net
of any provisions for doubtful debts, as disclosed in the statement of financial position and notes to the financial
statements.
(d) Commodity price risk
The Company is not exposed to commodity price risk as the operations of the Company are not yet at the production
stage.
(e) Liquidity risk
The Company manages liquidity risk by monitoring forecast cash flows.
The table below analyses the entity’s financial liabilities into relevant maturity groupings based on the remaining
period from the statement of financial position date to the contractual maturity date. As the amounts disclosed in
the table are the contractual undiscounted cash flows, these balances will not necessarily agree with the amounts
disclosed in the statement of financial position.
44
Notes To The Financial Statements
For the year ended 30 June 2020
Note 18: Financial Risk Management Objectives and Policies (continued)
45
30 June 2020
Financial liabilities due
for payment
Trade and other payables
Lease liabilities
Funds in advance
Financial assets – cash
flows realisable
Cash assets
Trade and other receivables
Net (outflow)/inflow on
financial instruments
30 June 2019
Financial liabilities due
for payment
Trade and other payables
Funds in advance
Financial assets – cash
flows realisable
Cash assets
Trade and other receivable
Net (outflow)/inflow on
financial instruments
Less than 6
months
$
6 months
to 1 year
$
1 to 5 years
$
Total
$
(144,916)
(7,058)
(3,121,977)
(3,273,951)
-
(7,059)
-
(7,059)
-
(29,076)
-
(29,076)
(144,916)
(43,193)
(3,121,977)
(3,310,086)
732,856
29,166
762,022
-
-
-
-
-
-
732,856
29,166
762,022
(2,511,929)
(7,059)
(29,076)
(2,548,064)
(172,055)
-
(172,055)
-
(1,706,542)
(1,706,542)
1,377,481
30,597
1,408,078
-
-
-
1,236,023
(1,706,542)
-
-
-
-
-
-
-
(172,055)
(1,706,542)
(1,878,597)
1,377,481
30,597
1,408,078
(470,519)
There were no Level 2 or Level 3 financial instruments.
(f)
Foreign exchange risk
The Company is exposed to foreign exchange risk as certain transactions are denominated in United States Dollars
and Peruvian Nuevos Soles as a result of operating in Peru.
The Group’s exposure to foreign currency risk at the end of the reporting period, expressed in Australian dollars, is
mainly in relation to its cash and cash equivalents and exploration and evaluation expenditure, and was as follows.
30 June 2020
Cash and cash equivalents
Exploration and evaluation expenditure
30 June 2019
Cash and cash equivalents
Exploration and evaluation expenditure
USD
$
PEN
$
40,869
-
1,137,028
-
64,805
7,646,058
51,344
5,870,693
45
Notes To The Financial Statements
For the year ended 30 June 2020
Note 18: Financial Risk Management Objectives and Policies (continued)
(g)
Net fair value of financial assets and liabilities
46
The carrying amounts of financial instruments included in the statement of financial position approximate their fair
values due to their short terms of maturity.
Note 19: Events Subsequent to Reporting Date
The Company received written notification dated 14 May 2020 from South 32, that pursuant to the Agreement,
South 32 exercised its right to withdrawn from the Project held by Brillandino with immediate effect. Pursuant to
the Agreement, the Agreement shall terminate 60 days from 14 May 2020. On 13 July 2020, the Agreement was
terminated.
On 7 August 2020, 408,662,207 listed options exercisable at $0.012 per share expired.
On 25 August 2020, the Company held a General Meeting where shareholders approved a consolidated of capital
on the basis that every twenty shares be consolidated into one share, and where this consolidation results in a
fraction of share being held, the Company be authorised to round that fraction down to the nearest whole share.
No other matters or circumstances have arisen since the end of the financial year which significantly affected or
may significantly affect the Company’s operations or the state of affairs of the Company in future financial years.
Note 20: Contingent Liabilities
There are no contingent liabilities at reporting date.
Note 21: Contractual Obligations
Share Subscription and Earn-In Agreement (Agreement) with South32 Group Operations Pty Ltd (S32)
On 29 March 2019, the Company entered into an Agreement with S32 in relation to share subscription and earn-in
on its 100% subsidiary Brillandino Minerales S.A.C. (Brillandino), the holder of the Greater Riqueza Project. Under
the Agreement, S32 can earn-in to Brillindino by way of the following.
Phase 1 Funding
During the Phase 1 funding period:
(a) S32 must contribute 100% of the annual funding to allow Brillandino to incur project expenditure forming part
of the Phase 1 funding obligation;
(b) S32 must contribute such funding as is required to satisfy each annual funding, provided that S32, at a
minimum, contributes the cumulative funding specified below within the following timeframes:
(i)
(ii)
(iii)
(iv)
Year 1 Commitment - US$1. 7 million.
Year 2 Commitment - US$3.7 million.
Year 3 Commitment – US$6.0 million; and
Year 4 Commitment - US$9.0 million.
Share subscription
Tranche of subscription share
46
Notes To The Financial Statements
For the year ended 30 June 2020
Note 21: Contractual Obligations (continued)
47
Subject to satisfying each annual programme and annual budget, Brilliandino must allot and issue, such number of
shares equivalent to:
(i) Year 1 Commitment - US$1. 7 million. Subscription Shares equivalent to 11% of the Shares (on a diluted basis) in
Brilliandino.
(ii) Year 2 Commitment - US$3.7 million. An additional 13% of Shares (on a diluted basis) which results in S32
holding 24% of Shares (on a diluted basis);
(iii) Year 3 Commitment – US$6.0 million. An additional 16% of Shares (on a diluted basis) which results in S32
holding 40% of Shares (on a diluted basis);
(iv) Year 4 Commitment - US$9.0 million.
An additional 20% of Shares (on a diluted basis) which results in S32 holding 60% of Shares (on a diluted
basis).
Over the course of the 4-year phase 1 period, should the US$9.0 million expenditure commitment be met by S32,
S32 will be issued a total of 60% of the issued share capital in Brilliandino.
Right of withdrawal
S32 may elect to withdraw on the completion of each annual programme/annual budget during Phase 1 provided
that S32 has:
(i) fully met the expenditures set out in the relevant annual funding; and
(ii) by the proposed date of withdrawal, paid the total cumulative amount specified in the relevant annual
commitment, then
S32 may exercise its right to withdraw from the Agreement and S32 is released from all further obligations, funding
commitments and liabilities under the Agreement, and the Agreement will terminate.
Failure to complete Phase 1 funding
(a) Unless otherwise agreed in writing, if Inca complies with its obligations under the Agreement and S32 fails to
contribute in accordance with the terms and conditions of the Agreement or withdraws from the Agreement
then:
(A) S32 may issue a notice to Inca requiring Inca to acquire or buy back all of S32's Shares for $1; or
(B) Inca may issue a notice to S32 requiring S32 to sell all or agree to the buy-back of all of S32's shares to Inca for
$1.
Satisfaction of Phase 1 Funding Obligation
If S32 satisfies the Phase 1 funding obligation and has not withdrawn from the Agreement:
(a) S32, Brillandino and Inca must promptly meet and negotiate in good faith to agree the final terms and
conditions of a Shareholders' Agreement, which must be on customary terms and conditions, with such
agreement to be reached within 90 days from the date that S32 satisfies the Phase 1 funding obligation; and
(b) S32 may within 60 days of the end of the Phase 1 funding period elect to exercise its right to carry out the
Phase 2 funding obligation.
47
Notes To The Financial Statements
For the year ended 30 June 2020
Note 21: Contractual Obligations (continued)
Phase 2 Funding
48
Under the Phase 2 funding:
(i) S32 is entitled to subscribe for an additional total 10% shareholding in Brillandino; and
(ii) S32 must contribute 100% of the funding to allow Brillandino to incur project expenditure pursuant to such
annual programmes and annual budgets as is necessary in order to complete a pre-feasibility study.
(b) Provided that S32 has satisfied the expenditures set out in the relevant annual programme and annual budget
during the Phase 2 funding period, S32 may withdraw from its obligation to carry out the Phase 2 funding
obligation at any time during the Phase 2 funding in which case S32 has no ·entitlement to retain any of
the shares in Brillandino which it acquired as part of the Phase 2 funding obligation.
As noted in note 19, the Company received written notification dated 14 May 2020 from South 32, that pursuant
to the Agreement, South 32 exercised its right to withdrawn from the Project held by Brillandino. Pursuant to the
Agreement, the Agreement shall terminate 60 days from 14 May 2020. On 13 July 2020, the Agreement was
terminated.
Note 22: Controlled Entities
Subsidiaries of Inca Minerals Limited:
Urcaguary Pty Ltd
Inca Minerales S.A.C.
Brillandino S.A.C.
Dos Colinas S.A.C.
Hydra Minerals Ltd
Dingo Minerals Pty Ltd
Note 23: Parent Information
Country of
Incorporation
Australia
Peru
Peru
Peru
Australia
Australia
Financial position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net Assets
Equity
Issued capital
Accumulated Losses
Total equity
Percentage Controlled (%)
2020
2019
100
100
100
-
100
100
2020
$
100
100
100
100
100
100
2019
$
677,183
6,216,301
6,893,484
225,921
6,474,469
6,700,390
(155,718)
(29,076)
(184,794)
(188,181)
-
(188,181)
6,708,690
6,512,209
41,559,456
32,851
(34,883,617)
6,708,690
39,543,925
-
(33,031,716)
6,512,209
48
Notes To The Financial Statements
For the year ended 30 June 2020
49
Note 23: Parent Information (continued)
Financial performance
(Loss) for the year
Other comprehensive income
Total comprehensive income
(1,851,901)
-
(1,851,900)
(1,522,970)
-
(1,522,970)
There are no guarantees entered into by the parent entity in relation to the debts of its subsidiaries. There are no
contingent liabilities of the parent entity as at the reporting date.
There are no contractual commitments by the parent entity for the acquisition of property, plant and equipment
as at the reporting date.
The Company has certain operating commitments pertaining to non-cancellable operating leases and agreements
contracted for but not recognised in the financial statements:
2020
$
17,551
35,102
52,653
2019
$
17,947
52,654
70,601
Not later than one year
Between one and five years
Note 24: Company Details
The principal place of business of the Company is:
Inca Minerals Limited
Suite 1, 16 Nicholson Road
Subiaco, WA, 6008
Australia
49
Directors’ Declaration
The Directors of the Company declare that:
50
1.
the financial statements and notes, as set out on pages 12 to 43, are in accordance with the Corporations
Act 2001 and:
a.
b.
comply with Accounting Standards, which, as stated in accounting policy Note 1 to the financial
statements, constitutes explicit and unreserved compliance with International Financial Reporting
Standards (IFRS);
give a true and fair view of the financial position as at 30 June 2020 and of the performance for the
year ended on that date of the Group;
2.
the Directors have been given the declarations required by s295A of the Corporations Act 2001 that:
a.
b.
c.
the financial records of the Company for the financial year have been properly maintained in
accordance with s286 of the Corporations Act 2001;
the financial statements and notes for the financial year comply with Accounting Standards; and
the financial statements and notes for the financial year give a true and fair view.
3.
in the Directors’ opinion there are reasonable grounds to believe that the Company will be able to pay its
debts as and when they become due and payable.
This declaration is made in accordance with a resolution of the Board of Directors.
On behalf of the Directors:
`
Ross Brown
Director
Dated at Perth this 7th day of September 2020
50
PO Box 1908
West Perth WA 6872
Australia
Level 2, 1 Walker Avenue
West Perth WA 6005
Australia
Tel: +61 8 9481 3188
Fax: +61 8 9321 1204
ABN: 84 144 581 519
www.stantons.com.au
Stantons International Audit and Consulting Pty Ltd
trading as
Chartered Accountants and Consultants
7 September 2020
The Directors
Inca Minerals Limited
Suite 1, 16 Nicholson Road
Subiaco WA 6008
Dear Sirs
RE: INCA MINERALS LIMITED
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of Inca Minerals Limited.
As Audit Director for the audit of the financial statements of Inca Minerals Limited for the year ended 30 June
2020, I declare that to the best of my knowledge and belief, there have been no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii)
any applicable code of professional conduct in relation to the audit.
Yours faithfully,
STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD
(Trading as Stantons International)
(An Authorised Audit Company)
Samir Tirodkar
Director
Liability limited by a scheme approved
under Professional Standards Legislation
Stantons International Audit and Consulting Pty Ltd
trading as
Chartered Accountants and Consultants
PO Box 1908
West Perth WA 6872
Australia
Level 2, 1 Walker Avenue
West Perth WA 6005
Australia
Tel: +61 8 9481 3188
Fax: +61 8 9321 1204
ABN: 84 144 581 519
www.stantons.com.au
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
INCA MINERALS LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Inca Minerals Limited (the Company and its subsidiaries (“the Group”),
which comprises the consolidated statement of financial position as at 30 June 2020, the consolidated
statement of comprehensive income, the consolidated statement of changes in equity and the consolidated
statement of cash flows for the year then ended and notes to the financial statements, including a summary of
significant accounting policies and the directors' declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
(i)
giving a true and fair view of the Group's financial position as at 30 June 2020 and of its financial
performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards
Board's APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the
Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Material Uncertainty Related to Going concern
Without modifying our audit opinion expressed above, attention is drawn to the following matter:
As referred to Note 1 to the financial statements, the consolidated financial statements have been prepared on
a going concern basis. As at 30 June 2020, the Group had cash and cash equivalents of $732,856, incurred a
loss after tax of $1,472,889 for the financial year ended 30 June 2020 and had net cash outflows from
operating and investing activities of $3,790,661.
The ability of the Group to continue as a going concern and meet its planned exploration, administration and
other commitments is dependent upon the Group raising further working capital and/or successfully exploiting
its mineral assets. In the event that the Group is not successful in raising further equity or successfully
exploiting its mineral assets, the Group may not be able to meet its liabilities as and when they fall due and the
realisable value of the Group’s current and non-current assets may be significantly less than book values.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial report of the current period. These matters were addressed in the context of our audit of the
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
Liability limited by a scheme approved
under Professional Standards Legislation
Key Audit Matters
How the matter was addressed in the audit
Carrying Value of Capitalised Exploration and
Evaluation Expenditure
As at 30 June 2020, Capitalised Exploration and
Evaluation expenditure totals $9,118,246 (refer to
Note 1(d) and note 7 to the financial report).
The carrying value of Capitalised Exploration and
Evaluation expenditure is a key audit matter due to:
•
•
•
The significance of the total balance (90% of total
assets);
to assess management’s
The necessity
application of the requirements of the accounting
standard Exploration
for and Evaluation of
Mineral Resources (“AASB 6”), in light of any
indicators of impairment that may be present;
and
The assessment of significant judgements made
by management in relation to the Capitalised
Exploration and Evaluation Expenditure.
Contributed Equity
the
During
to
The Group’s Contributed Equity amounted
$41,559,456.
year,
1,102,633,628 ordinary shares were issued through
placements and shares issued as consideration for
services, resulting in an increase in Contributed
Equity of $2,015,532 net of capital raising costs (refer
to Note 10 to the financial report).
reporting
Contributed Equity is a key audit matter due to:
•
•
the quantum of share capital issued during the
year; and
the varied nature of the movements during the
year.
We have spent significant audit effort on ensuring the
Contributed Equity was appropriately accounted for
and disclosed.
Inter alia, our audit procedures included the following:
i. Assessing
the Group’s right
tenure over
exploration assets by corroborating the ownership
of the relevant licences for mineral resources to
government registries and relevant third party
documentation;
to
ii. Reviewing
the directors’ assessment of
the
carrying value of the exploration and evaluation
expenditure, ensuring the veracity of the data
presented and that management has considered
the effect of potential
indicators,
commodity prices and the stage of the Group’s
projects against AASB 6;
impairment
iii. Evaluation of Group documents for consistency
with the intentions for the continuing of exploration
and evaluation activities
in certain areas of
interest, and corroborated with enquiries of
management.
the documents we
evaluated included:
Inter alia,
▪ Minutes of meetings of
the board and
management;
▪ Announcements made by the Group to the
Australian Securities Exchange; and
▪ Cash flow forecasts; and
iv. Consideration of the requirements of accounting
standard AASB 6. We assessed the financial
statements in relation to AASB 6 to ensure
appropriate disclosures are made.
Inter alia, our audit procedures included the following:
i. Obtaining an understanding of the underlying
transactions;
ii. Verifying all issued capital movements to the
relevant ASX announcements;
iii. Vouching proceeds from capital raisings to bank
relevant supporting
statements and other
documentation;
iv. Verifying underlying capital raising costs and
costs were appropriately
these
ensuring
recorded;
v. Ensuring consideration for services provided are
measured in accordance with AASB 2 Share-
Based Payments and agreed the related costs to
relevant supporting documentation; and
vi. Ensuring
the
relevant
requirements of
accounting standards and disclosures achieve fair
financial
presentation
statements to ensure appropriate disclosures are
made.
reviewing
and
the
the
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group's annual report for the year ended 30 June 2020, but does not include the financial
report and our auditor's report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we
have performed, we conclude that there is a material misstatement of this other information, we are required
to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no
realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with the Australian Auditing Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of this
financial report.
As part of an audit in accordance with Australian Auditing Standards, we exercise professional judgement and
maintain professional scepticism throughout the audit. An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the financial report.
The procedures selected depend on the auditor's judgement, including the assessment of the risks of material
misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity's preparation of the financial report that gives a true and
fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the entity's internal control.
The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial
report.
We conclude on the appropriateness of the Directors' use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions
that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures
in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based
on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may
cause the Group to cease to continue as a going concern.
We evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that achieves
fair presentation.
We obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the financial report. We are responsible for the direction,
supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the Directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in Internal control that we identify
during our audit.
The Auditing Standards require that we comply with relevant ethical requirements relating to audit
engagements. We also provide the Directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the Directors, we determine those matters that were of most significance
in the audit of the consolidated financial report of the current period and are therefore key audit matters. We
describe these matters in our auditor's report unless law or regulation precludes public disclosure about the
matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in
our report because the adverse consequences of doing so would reasonably be expected to outweigh the
public interest benefits of such communication.
Report on the Remuneration Report
We have audited the Remuneration Report included in pages 9 to 12 of the directors’ report for the year ended
30 June 2020. The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to
express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Opinion on the Remuneration Report
In our opinion, the Remuneration Report of Inca Minerals Limited for the year ended 30 June 2020 complies
with section 300A of the Corporations Act 2001.
STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD
(Trading as Stantons International)
(An Authorised Audit Company)
Samir Tirodkar
Director
West Perth, Western Australia
7 September 2020
Shareholder Information
56
The shareholder information set out below is applicable as at 11 September 2020 unless otherwise stated.
CAPITAL STRUCTURE
The Company currently has issued capital of 203,911,338 fully paid ordinary shares. The Company has also issued
35,802,744 options with an exercise price of $0.14 and an expiry date of 31 October 2022. The Company has no
other class of security or options on issue.
VOTING RIGHTS
The Company’s Constitution provides that at a meeting of shareholders, and on a show of hands, each shareholder present in
person and each other person present as a proxy, attorney or representative of a shareholder has one vote. On a poll, each
shareholder present in person has one vote for each fully paid ordinary share held by the shareholder and each person as a
proxy, attorney or representative of a shareholder has one vote for each fully paid ordinary share held by the shareholder that
person represents.
DISTRIBUTION OF EQUITY SECURITIES at 11 September 2020
The number of holders by size of their holding of fully paid ordinary issued shares in the Company is as follows:
SPREADS OF HOLDINGS
NUMBER OF
NUMBER
% OF TOTAL ISSUED
HOLDERS
OF UNITS
CAPITAL
138,464
0.68%
1,424,534
0.699%
2,579,742
1.265%
32,275,511
15.828%
167,493,087 82.14%
203,911,338
100%
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 >
TOTAL
383
473
334
896
330
2,416
SUBSTANTIAL SHAREHOLDERS
There are no Substantial Shareholders.
ESCROW
There are no Company securities subject to voluntary escrow.
UNMARKETABLE PARCELS
As at 11 September 2020 there were 1,066 shareholders with an unmarketable share parcel of less than 8,333
shares at the prevailing share price of .06 cents.
56
Shareholder Information (continued)
57
TWENTY LARGEST SHAREHOLDERS
The names and details of the twenty largest quoted shareholdings in the Company as at 11 September 2020 are
as follows:
57
Tenement Schedule
58
END OF REPORT
58
CountryStateProject NameTenement NamePeruRiquezaNeuva Santa RiaGranted10045501Earning 100%1Brillandino Minerals S.A.C.PeruRiquezaRita MariaGranted10171016100%Brillandino Minerals S.A.C.PeruRiquezaAntacocha IGranted10249916100%Brillandino Minerals S.A.C.PeruRiquezaAntacocha IIGranted10249716100%Brillandino Minerals S.A.C.PeruRiquezaMaihuasiGranted10249816100%Brillandino Minerals S.A.C.PeruRiquezaUchpangaGranted10170916100%Brillandino Minerals S.A.C.PeruRiquezaUchpanga IIGranted10251716100%Brillandino Minerals S.A.C.PeruRiquezaUchpanga IIIGranted10251616100%Brillandino Minerals S.A.C.PeruRiquezaPicuyGranted10171116100%Brillandino Minerals S.A.C.PeruCerro RayasLa Elegida Granted010109205100%Inca Minerales S.A.C.PeruCerro RayasPuyuhuanGranted010336917100%Inca Minerales S.A.C.PeruCerro RayasHuaytapataGranted010337017100%Inca Minerales S.A.C.PeruCerro RayasHuaytapata SurGranted010221018100%Inca Minerales S.A.C.PeruCerro RayasVicuna PuquioGranted010221018100%Inca Minerales S.A.C.PeruCerro RayasVicuna Puquio IIGranted010221018100%Inca Minerales S.A.C.PeruCerro RayasTablamachayGranted010221018100%Inca Minerales S.A.C.PeruCerro RayasYacunaGranted010221318100%Inca Minerales S.A.C.PeruCerro RayasIntihuanunanGranted010221418100%Inca Minerales S.A.C.AustraliaQLDMaCauley CreekMaCauley Creek SouthGrantedEPM27124Earning 100%2Inca Minerals LimitedAustraliaQLDMaCauley CreekMaCauley Creek NorthGrantedEPM27163Earning 100%2Inca Minerals LimitedAustraliaNTFrewena FableFrewena FableGrantedEL31974Earning 100%3Inca Minerals LimitedAustraliaNTFrewena FableFrewena Fable NorthApplicationEL32287Earning 100%3Inca Minerals LimitedAustraliaNTFrewena EastFrewena EastApplicationEL32289Earning 100%4Inca Minerals LimitedAustraliaNTFrewena Far EastFrewena Far EastApplicationEL32293Earning 100%5Inca Minerals LimitedAustraliaNTLorna May Lorna May ApplicationEL32107Earning 100%6Inca Minerals LimitedAustraliaNTJean ElsonJean Elson WestApplicationEL32485Earning 100%7Inca Minerals LimitedAustraliaNTJean ElsonJean Elson EastApplicationEL32486Earning 100%7Inca Minerals LimitedEast TimorManatutoManatutoApplicationN/A100%Inca Minerals LimitedEast TimorOssuOssuApplicationN/A100%Inca Minerals LimitedEast TimorPaatalPaatalApplicationN/A100%Inca Minerals LimitedNote 1: Mining Option Agreement between Inca Minerales and Minera Rimpago S.A.C. with Rimpago carried free interest to residual 1% NSR.Note 2: JV between Inca and MRG Resources Pty Ltd (MRG) with MRG having 10% carried free interest up to feasibility and residual 1.5 % NSR.Note 3: JV between Inca (90%), MRG (5%) and Dr West (5%) with MRG and West carried free up to feasibility and residual 1.5 % NSR shared between MRG and West.Note 4: JV between Inca (90%), MRG (5%) and Dr West (5%) with MRG and West carried free up to feasibility and residual 1.5 % NSR shared between MRG and West.Note 5: JV between Inca (90%), MRG (5%) and Dr West (5%) with MRG and West carried free up to feasibility and residual 1.5 % NSR shared between MRG and West.Note 6: JV between Inca and MRG with MRG having 5% carried free interest up to feasibility and residual 1.5 % NSR.Note 7: JV between Inca and MRG with MRG having 10% carried free interest up to feasibility and residual 1.5 % NSR.Tenement NumberLocationTenement StatusTenement IdentificationTenement Ownership
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