IRONRIDGE RESOURCES LIMITED
AND CONTROLLED ENTITIES
ACN: 127 215 132
Annual Report
2016 CORPORATE INFORMATION
DIRECTORS
BROKER
Nicholas Mather
Vincent Mascolo
Geoffrey (Stuart) Crow
Neil Herbert
Tiaan Van Aswegen
Alistair McAdam
Kenichiro Tsubaki – appointed 31 March 2016
COMPANY SECRETARY
Karl Schlobohm
REGISTERED OFFICE
Level 27, 111 Eagle St
Brisbane QLD 4000
Phone: + 61 7 3303 0610
Fax: +61 7 3303 0681
Email: info@ironridgeresources.com.au
Web Site: www.ironridgeresources.com.au
AUDITOR
BDO Audit Pty Ltd
Level 10, 12 Creek Street
Brisbane QLD 4000
Australia
NOMINATED ADVISOR
SP Angel Corporate Finance LLP
Prince Frederick House
35-39 Maddox Street
London W1S 2PP
United Kingdom
SP Angel Corporate Finance LLP
Prince Frederick House
35-39 Maddox Street
London W1S 2PP
United Kingdom
BANKERS
Macquarie Bank Ltd (Brisbane Branch)
345 Queen Street, Brisbane QLD 4000
Australia
UK SOLICITORS
Locke Lord LLP
201 Bishopsgate,
London EC2M 3AB,
United Kingdom
AUSTRALIAN SOLICITORS
Hopgood Ganim
Level 8, Waterfront Place
1 Eagle Street,
Brisbane QLD 4000, Australia
REGISTRAR
Computershare Investor Services plc
The Pavilions, Bridgwater Road
Bristol BS99 7NH
United Kingdom
2 | Annual Report | 2016
2 | Annual Report | 2016
CONTENTS
Corporate information
Chairman’s report
Directors’ report
Auditor’s independence declaration
Interest in tenements
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
Independent auditor’s report
2
4
5
37
38
39
40
41
42
43
66
67
Annual Report | 2016 | 3
CHAIRMAN’S REPORT
Dear Shareholder,
It has been a busy and productive year for the Company since my last Chairman’s Report.
As foreshadowed in my previous report, and against the backdrop of a greater than 50% decline in the price of
iron ore since 2013, the Company’s experienced Board and management team, coupled with a strong treasury,
afforded IronRidge the perfect opportunity to capitalize on a number of African resource project opportunities
as they arose over the course of the last 12 months.
As shareholders would be aware, since the Company made its AIM debut in February 2015, the global iron
ore market has seen unprecedented volatility and its lowest prices in a decade. The Board and management
team took the view that the state of the global iron ore market, and the outlook for prices in the next five years,
was not conducive to extensive iron ore exploration and development. Accordingly, whilst the Company has
maintained its principal iron ore assets in Gabon, it is now taking a conservative approach to their exploration
and development until the iron ore price returns to a level which would underpin a likely project development.
In order to compliment the Company’s existing iron ore projects, and to provide upside for future growth,
IronRidge conducted a comprehensive top down global search for province-scale grass roots and / or advanced
projects offering the potential for the discovery of world class deposits. This involved an intensive research
and review program using in-house geological expertise and leveraging the knowledge and experience of the
Company’s key stakeholders, DGR Global, Assore Limited and Sumitomo Corporation.
As a result of these initiatives, the Company has now secured several potential world class project opportunities
in Africa, including gold projects in Chad and lithium projects in Ghana and Cote d’Ivoire, as well as augmenting
its Australian asset base via pegging further potential bauxite tenure and identifying the May Queen gold
prospect within its existing Queensland land package.
I am particularly excited by the Chad gold projects, secured via an agreement reached with Tekton Pte Ltd,
under which IronRidge will invest up to US$3.5m in Tekton for up to a 58% shareholding. This will provide
IronRidge with a first mover advantage within several highly prospective, province-scale, gold mineralised
belts with little or no modern-day exploration and largely forgotten due to Chad’s historical oil exploration and
production focus. Tekton has secured exclusive rights over five exploration permits covering a total of 1,000km2,
in addition to 400km2 of reconnaissance licences within the Ouaddaï Province; an under-explored yet highly
prospective domain within the Saharan Metacraton of Central Africa.
I would like to acknowledge the vision and efforts of the Company’s CEO Mr Vincent Mascolo and Global
Exploration Manager Len Kolff over the past 12 months in delivering a number of outstanding opportunities
for IronRidge. Vincent and Len have been ably supported by the Company’s wider management team, and the
Board of Directors, who have all contributed greatly to the tight and effective deployment of the Company’s
revised strategy.
The next year should prove to be very exciting as the Company now moves towards the exploration and
development of its expanded suite of Australian and African resource projects.
Yours sincerely
Nicholas Mather
Executive Chairman
4 | Annual Report | 2016
DIRECTORS REPORT
Your Directors submit their report for the year ended
30 June 2016.
• Armour Energy Limited, which is listed on the ASX
• Lakes Oil NL (appointed 7 February 2012), which is
DIRECTORS
The names and details of the Company’s Directors in
office during the financial year and until the date of
this report are as follows. Directors were in office for
this entire period unless otherwise stated.
Nicholas Mather
Vincent Mascolo
Geoffrey (Stuart) Crow
Neil Herbert – appointed 12 February 2015
Bastiaan Van Aswegen – appointed 12 February 2015
Alistair McAdam – appointed 12 February 2015
Tsuyoshi Ueda – appointed 26 May 2015
and resigned 31 March 2016
Kenichiro Tsubaki – appointed 31 March 2016
Christelle Van der Merwe (alternate for Bastiaan Van
Aswegen) – appointed 12 February 2015
Frans Olivier (alternate for Alistair McAdam) –
appointed 12 February 2015
Nicholas Mather – Executive Chairman
BSc (Hons, Geology), MAusIMM
Mr Mather’s special area of experience and expertise
is the generation of and entry into undervalued or
unrecognised resource exploration opportunities. He
has been involved in the junior resource sector at all
levels for more than 25 years. In that time he has been
instrumental in the delivery of major resource projects
that have delivered significant gains to shareholders.
As an investor, securing projects and financiers,
leading exploration campaigns and managing
emerging resource companies Mr Mather brings a
wealth of valuable experience.
During the past three years Mr Mather has also served
as a director of the following listed companies:
• DGR Global Limited, which is listed on the
Australian Securities Exchange (ASX)
• Orbis Gold Limited (resigned 16 February 2015),
which was listed on the ASX
• Aus Tin Mining Limited, which is listed on the ASX
• Dark Horse Resources Limited, which is listed on the ASX
listed on the ASX
• SolGold plc, which is listed on the London Stock
Exchange (AIM)
Vincent Mascolo – Managing Director and
Chief Executive Officer
BEng Mining, MAusIMM, MEI Aust
Mr Mascolo is a qualified mining engineer with
extensive experience in a variety of fields including,
gold and coal mining, quarrying, civil-works, bridge-
works, water and sewage treatment and estimating.
Mr Mascolo has completed his assignment in the Civil
and Construction Industry, including construction and
project management, engineering, quality control and
environment and safety management. He is also a
member of both the Australian Institute of Mining and
Metallurgy and the Institute of Engineers of Australia.
During the past three years Mr Mascolo has also
served as a director of the following listed company:
• DGR Global Limited, which is listed on the ASX
Stuart Crow – Non-Executive Director
Mr Crow has more than 27 years’ experience in all
aspects of corporate finance and investor relations in
Australia and international markets, and has owned
and operated his own businesses in these areas for
the last nineteen years. He brings extensive working
knowledge of global capital markets and investor
relations to the Board.
Throughout his career, Stuart has served on a number
of boards of public and unlisted companies and has
assisted in raising funds for companies of varying size
in Australia and International capital markets whilst
working for his own firm and before that some of the
world’s largest broking firms.
During the past three years Mr Crow has also served as
a director of the following listed company:
• TNG Limited, which is listed on the ASX
Annual Report | 2016 | 5
Neil Herbert – Non-Executive Director
Mr. Herbert is a Fellow of the Association of Chartered
Certified Accountants and has over 23 years of
experience in finance. Mr. Herbert has been involved
in growing mining and oil and gas companies, both
as an executive and an investment manager, for over
16 years and, until May 2013, was co-chairman and
managing director of AIM quoted Polo Resources
Limited, a natural resources investment company.
Prior to this, he was a director of resource investment
company Galahad Gold plc from which he became
finance director of its most successful investment,
start-up uranium company UraMin Inc. from 2005
to 2007, during which period he worked to float the
company on AIM and the Toronto Stock Exchange in
2006, raise c.US$400 million in equity financing and
negotiate the sale of the group for US$2.5 billion. Mr
Herbert has also held board positions at a number
of resource companies where he has been involved
in managing numerous acquisitions, disposals, stock
market listings and fundraisings. Mr Herbert holds
a joint honours degree in economics and economic
history from the University of Leicester.
Bastiaan Hendrikus van Aswegen
– Non-Executive Director
Mr. van Aswegen is a Member of the Southern African
Institute of Mining and Metallurgy and is a consulting
metallurgist for the Assore group. Mr. van Aswegen
has 28 years’ experience working in the mining and
ferro-alloy production industry. After working for Iscor
Ltd and Samancor Ltd in production and on projects,
he was appointed by Samancor Ltd as general
manager of the Palmiet Ferrochrome Operation
(Mogale) in 1999. Mr. van Aswegen joined Assore in
2003 and in September 2012 he was appointed group
technical and operations director of Assore.
Alistair McAdam
– Non-Executive Director
Mr. McAdam is a Member of the Institute of Materials,
Minerals and Mining and is a chartered engineer. Mr.
McAdam has over 20 years’ experience in platinum
and gold production and project evaluation. Mr.
McAdam held the position of sales manager at
Johannesburg Consolidated Investment Company Ltd
Group until his division was sold to Sudelektra South
Africa Holdings (Pty) Ltd and subsequently to Xstrata
and Glencore. Mr. McAdam joined Ore & Metal
Company Limited in 2000 and was appointed as the
group manager of new business in August 2013.
Kenichiro Tsubaki – Non-Executive Director
BEcon
Mr. Tsubaki joined Sumitomo Corporation in 1992
and has been involved in iron ore industry for over 20
years including work experiences in India and South
Africa. Mr. Tsubaki is currently manager of Sumitomo’s
Iron & Steel Making Raw Materials Department.
Christelle Van der Merwe – Alternate Director
BSc (Hons, Geology), BSc (Environmental
Management), MAP79 B.Arch
Ms Van der Merwe is a mining geologist responsible
for the mining-related geology and resources of
the Assore Subsidiary Companies (comprising
the pyrophyllite and chromite mines), and is also
concerned with the company’s iron and manganese
mines. She has been the Assore group geologist
since 2013 and involved with strategic and resource
investment decisions of the company. Ms Van der
Merwe is a member of SACNASP and the GSSA.
Frans Olivier – Alternate Director
BEng (Mining), MCom (Business Management),
GDE (Mining), SAIMM
Mr Olivier has extensive mining operations and
management experience gained through General
Mining Corporation, Sasol Coal, Iscor Mining and
Assmang (African Mining and Trust). Mr Olivier has
been responsible for the detailed economic evaluation
of major open pit and underground mine projects in
South Africa, Ghana, Kazakhstan, Democratic Republic
of Congo and Russia.
As at the date of this report, the interest of the
Directors in the shares and options of IronRidge
Resources Limited were:
Number of
Ordinary Shares
Number of
Options over
Ordinary Shares
Nicholas Mather
1,303,703
1,500,000
Vincent Mascolo
8,310,291
3,000,000
Stuart Crow
Neil Herbert
Bastiaan van Aswegen
Alistair McAdam
Kenichiro Tsubaki
1,000,000
1,500,000
-
-
-
-
-
-
-
-
6 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. The Company was admitted to AIM on Thursday, 12
February 2015. The Company successfully completed
a placing (“Placing”) of and the subscription for
96,538,380 new Ordinary Shares to raise approximately
£9.7 million ($19.2 million). The total number of shares
on issue at Admission was 236,612,203 giving the
Company a market capitalisation of approximately
£23.7 million ($46.9 million) on Admission at the
Placing and Investor Subscription Price of 10p per
share. The funds raised will be used to undertake
exploration mapping, sampling and an approximately
15,000 metre planned drilling programme on the
Company’s exploration projects in Gabon: the
Tchibanga and Tchibanga North license areas, two
adjacent permitted areas located in the Tchibanga
region in the south-west of Gabon, and the Belinga
Sud Prospect, located in the north-east of Gabon; as
well as providing working capital for the Company.
There have been no other significant changes in the
nature of the activities of the Company during the
financial year.
DIVIDENDS
No dividends were declared or paid during the
financial year.
COMPANY SECRETARY
Karl Schlobohm – Company Secretary
B.Comm, B.Econ, M.Tax, CA, AICD
Karl Schlobohm is a Chartered Accountant with over
20 years’ experience across a wide range of industries
and businesses. He has extensive experience with
financial accounting, corporate governance, company
secretarial duties and board reporting.
He currently acts as the Company Secretary for ASX-
listed DGR Global Limited, Dark Horse Resources
Limited, Aus Tin Mining Limited, Armour Energy
Limited and LSE (AIM) listed SolGold Plc.
CORPORATE STRUCTURE
IronRidge Resources Limited is a company limited
by shares that is incorporated and domiciled in
Australia. It was converted to a public company on
22 August 2011.
PRINCIPAL ACTIVITIES
IronRidge was originally established to explore for
uranium in southern Queensland and over a number of
years the Company accumulated a sizeable package
of Exploration Permits for Minerals (EPM) and an
Exploration Permit for Coal (EPC), focused mainly in
the Surat Basin, in Queensland, Australia.
In late 2011 the Company sought to expand its
strategy of “Early Mover Advantage” into regions of
Africa prospective for iron ore. Following a global
search for a new prospective province, equatorial West
Africa was identified as a compelling opportunity lying
on the extensive Proterozoic aged iron belt which
originally stretched across the ancient continent of
Pangaea from the Pilbara in Western Australia across
India and Africa to the famous and prolific Carajas iron
region in Brazil. Licenses over vacant project areas
were applied for and subsequently granted over the
Tchibanga and Belinga Sud areas in Gabon. IronRidge
was attracted to the size of the project and targets,
close proximity to the coastal port site of Mayumba,
infrastructure upgrading initiatives by the progressive
Gabonese Government and evident presence of
high grade iron mineralisation up to 62% on the main
prospect at Mont Pele.
Annual Report | 2016 | 7
DIRECTORS REPORT CONTINUED. REVIEW OF OPERATIONS AND
FUTURE DEVELOPMENTS
The 2016 Financial year proved to be a constructive
and transformative year for the Company with large-
scale, multi-commodity focus projects secured in
exciting new frontier regions of Australia, West and
Central Africa.
Key achievements during the past twelve months
included:
• The appointment of Mr Lennard Kolff van
Oosterwijk (“Len Kolff”) as the Company’s Country
Manager for Gabon overseeing the SRK ES
activities.
• Completion of exploration programmes and
discovery of iron ore mineralisation over the
Tchibanga and Belinga Sud projects in Gabon, West
Africa within time and budget.
• License application submitted over Tchibanga Sud
in Gabon where surface enriched iron mineralisation
was mapped to the current license boundary.
The Company announced extremely high-grade gold
intersections including 1m at 145g/t Au in historic
drilling at the May Queen prospect in Southern
Queensland, Australia.
The Company announced a landmark partnership
with Tekton Minerals in Chad, Central Africa where
work to date has identified multiple, potential multi-
million ounce scale gold targets within the Saharan
Metacraton; an underexplored yet highly prospective
geological Province.
The key focus areas for the 2017 financial year are:
GABON
License renewals
•
• Review iron ore assets that complement its
existing portfolio in Gabon
AUSTRALIA
• Complete the Hydro Metallurgical test work for
potential titanium and bauxite extraction.
• Ongoing investigation of bauxite and titanium
targets.
• Continuation of exploration activities at our
• Drill test the May Queen high-grade gold targets
Australian assets.
CHAD
• Complete a regional aeromagnetic and
radiometrics survey over the project areas.
• Ongoing exploration activities to prioritise existing
targets and identify new targets.
• Further define high-priority targets for potential
drill testing.
BUSINESS DEVELOPMENT
• Continue to assess large, province scale grass-
roots and advanced projects that have the
potential to host world-class deposits throughout
Africa and globally.
Since IronRidge made its AIM debut in February 2015
and subsequent to the 2016 financial year, the iron
ore market has seen unprecedented volatility and its
lowest prices in a decade. Accordingly, the Company
took a conservative approach to ongoing exploration
at its iron ore projects in Gabon until prices return
to a sustained level which would underpin further
development. The Company, with the support of its
major shareholders continues to review iron ore assets
that complement its existing portfolio in Gabon.
In parallel, IronRidge has been conducting a top down
global search for province-scale, grass roots and /
or advanced projects in new frontiers which show
potential for the discovery of world class deposits,
in addition to a review of its extensive Australian
landholding. Iron Ridge’s initiatives have identified
several opportunities, which are the subject of
ongoing investigation in the ordinary course of the
Company’s business.
Subsequent to the 2016 financial year, the Company
announced a JORC compliant maiden bauxite
resource of 54Mt at 37% total alumina within a newly
discovered bauxite province with significant scale
potential at the Monogorilby Project in southern
Queensland, Australia.
8 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. EXPLORATION ACTIVITIES
GABON
During the year, IronRidge continued to advance the exploration and development of its three 100% owned iron
ore projects in the Republic of Gabon, West Africa.
The IronRidge projects in Gabon, West Africa, are shown in the following Figure 1. Gabon is one of the more
advanced nations in Africa, with an economy largely based on oil. It is however a recognised region for hosting
iron ore, and the stable Gabonese Government is promoting mining investment. The country already has
substantial rail and port infrastructure in place.
Figure 1: IronRidge Resources Gabon Tenement Locations
Annual Report | 2016 | 9
DIRECTORS REPORT CONTINUED. The Tchibanga Iron Project (“Tchibanga and Tchibanga Nord” or “Project”), located in the southwest region of
Gabon, is a near term iron ore exploration and development opportunity with the potential to produce DSO
rapidly at < 70km from the proposed deep water port of Mayumba.
The Belinga Sud Iron Project (“Belinga Sud” or “Project”) is a medium to longer term exploration and
development opportunity with the potential to produce DSO utilising existing infrastructure; rail and port at
Owendo.
TCHIBANGA PROJECT AREA
The Tchibanga exploration license covers 1,977km², is along strike from known iron ore occurrences and is
proximal to the proposed port of Mayumba. Given mineralization defined within the license was open to the
south, an additional license application (Tchibanga Sud) was submitted to the Ministry of Mines and Industry.
Figure 2: Tchibanga Project, Gabon, West Africa
Given its proximity to the coast, field work commenced on this project area. Field work consisted of extensive
mapping and rock chip sampling along geophysical and historical iron ore occurrence targets. A total of
11 target areas were assessed, 350 line kilometers traversed, 390 rock chips and 139 soil samples collected.
Detailed WorldDEM satellite topographic data was acquired over the project area to better define plateau
margins.
10 | Annual Report | 2016
DIRECTORS REPORT CONTINUED.
Mapping, pitting and assay results confirmed the presence of iron rich duricrust and canga type iron ore
mineralization at average 45% Fe (maximum 57% Fe) and low contaminants forming surface weathering enriched
plateaus over a combined surface area of 2.3km2 in the south-eastern portion of the project area.
Figure 3: Map showing location of canga plateaus defined to date, sampling and average grades over topography backdrop.
All samples were analysed by ALS Laboratory in Johannesburg for full, X-Ray Fluorescence (“XRF”) and Loss on
Ignition (“LOI”) analysis. Certified reference material, duplicates and analytical blanks were inserted every 20th
sample for QA/QC purposes, providing confidence in reported results.
Table 1: Weighted average iron ore grade of plateaus discovered at Tchibanga
Fe%
Si02%
Al203%
P%
Ti02%
S%
Mn%
LOI_1000
Wt Avg
Max
Min
# spls
45.18
56.67
27.24
102
13.49
49.8
3.27
102
9.07
18.1
2.53
102
0.051
0.154
0.007
102
1.45
3.78
0.08
102
0.12
0.325
0.055
102
0.01
0.124
0.001
102
10.77
15.69
3.73
102
The canga mineralisation defined is representative of surface enriched detrital and in-situ iron formation caused
by extensive and pervasive tropical weathering over an extended timeframe. It is of particular interest in that
weathering has caused enrichment of the iron formation and leaching of deleterious elements resulting in
high-grade, hematite-goethite mineralisation over extensive plateau areas with inferred low stripping ratios.
Annual Report | 2016 | 11
DIRECTORS REPORT CONTINUED. Figure 4: High-grade, massive canga and ferruginous laterite mineralisation cliff face within the Project area
Figure 5: Examples of canga type mineralisation discovered
Subsequent to the reporting period, the Company completed a low-cost, value add GPR geophysical survey
over the most significant iron enriched plateaus to assess depth potential of the ferruginous laterite and canga
plateaus discovered. The GPR methodology allowed the Company to rapidly assess depth potential prior to a
decision to commence more costly drilling. A total of 14 line Km of GPR profiles were completed over a 1 month
period, processed and interpreted.
12 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. Additionally the Company completed depth profiling via pitting and sampling down canga cliff faces to provide
an indication of grade continuity through the mineralised profile.
GPR results indicate a laterite and canga depth profile between 2m to 10m thick from surface. Similar
thicknesses were observed in laterite and canga cliff faces providing further confidence in the GPR results and
overall depth estimation.
BELINGA SUD PROJECT AREA
The Belinga Sud Permis de Recherche (see Figures 1 & 5) covers 1,976 km² and hosts hematite in conventional
Palaeoproterozoic Banded Iron Formations (BIF). It is directly south of the Belinga Iron Ore Deposit (860 Mt
@ 63% Fe), and 150 km from the Trans-Gabonese rail line. The tenement contains several exploration targets
evident from magnetic anomalies and preliminary exploration, and the potential for an initial direct shipping
(DSO) project.
Five key target areas; Indombo (Central, South and North) and Massaha (East and West) were defined from the
regional aeromagnetics survey for ground follow-up during the reporting period. Detailed WorldDEM satellite
topographic data was acquired to better define targets and access over the Indombo area.
Subsequent to the reporting period, a total of 165 line kilometres was traversed and mapped over the five target
areas, with a total of 90 samples collected for assay and dispatched.
Figure 6: Belinga Sud Project, Gabon, West Africa
Annual Report | 2016 | 13
DIRECTORS REPORT CONTINUED. Over 10km strike of iron formation was defined at Indombo, split over three discrete target areas, and over
3km strike at Massaha. Widths of iron formation are poorly constrained due to thick vegetation cover; however,
mapping and landforms suggests widths of between 50m up to potentially 300m wide.
Figure 7: Summary of ground coverage at Indombo overlaid on the analytic signal (left), WorldDEM (centre) and geology (right) at the Belinga Sud Project
14 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. AUSTRALIA
IronRidge Resources has an extensive ground holding in central-southern Queensland prospective for bauxite,
titanium, gold and iron ore. The Company initially targeted the area for titanium and subsequently through
auger drilling defined bauxite mineralization in addition to minor iron ore.
Further applications were submitted as it was recognized that bauxite mineralization was potentially more
extensive and in some cases partially blind.
Review of historic data and reports highlighted gold prospectivity within the project portfolio too, with
high-grade gold intersections up to 145g/t Au over 1m in historic drilling at the May Queen prospect.
Figure 8: IronRidge Resources Australia Tenement Locations
Annual Report | 2016 | 15
DIRECTORS REPORT CONTINUED. MONOGORILBY BAUXITE AND TITANIUM PROJECT
The Monogorilby project is located in central Queensland, within a short trucking distance of the dormant rail
system leading north to the Port of Bundaberg, including provision for a multi-user loader. It is also located
within close proximity of the active Queensland Rail network heading south towards the Port of Brisbane.
The project is wholly owned by IronRidge Resources and its local subsidiary Eastern Exploration Pty Ltd over
awarded licenses EPM 19419, EPM 25975, EPM 16261 and EPM 16260.
Subsequent to the reporting period, independent consultants Mining One Pty Ltd of Melbourne, Australia
prepared a JORC 2012 compliant maiden mineral resource estimate for the Monogorilby Bauxite Project based
on a 94 drill hole (for 2,424m) reverse circulation (“RC”) percussion drilling programme.
A maiden 54.9 MT inferred bauxite mineral resource estimate at 37.5% total alumina and 8.5% total silica was
estimated. The mineralisation is found on hilltops and slopes implying low stripping ratios at an average 7m and
up to 14m thick bauxite profile from surface.
A 3D interpretation of the mineralised domain was constructed using sectional interpretation strings as well as
detailed government topographic (ortho-DEM) data to build the domain wireframe and modelling constraints.
An inverse distance weighted estimate was modelled for key variables, that estimated tonnes and grades into a
block model. All blocks were constrained to a resource wireframe and all blocks outside this wireframe were not
considered in the calculations.
Results of the estimation are shown in table x below, and the grade tonnage curve for Avl_Al2O3% is shown in
figure x below.
Table 2: Maiden Mineral Resource Estimate (JORC 2012 compliant), Monogorilby Bauxite Project
Resources
Class
Measured
Indicated
-
-
-
-
Inferred
54,894,438
Totals
54,894,438
28.02
28.02
MONOGORILBY RESOURCE (>30% Tot Al2O3, <10% Tot SiO2 and >18.5% LOI)
Tonnes
Avl
Al2O3%
Tot
Al2O3%
Rx
SiO2%
A:S
LOI%
Tot
SiO2%
FE2O3
TiO2%
V%
-
-
37.5
37.5
-
-
7.9
7.9
-
-
3.6
3.6
-
-
20.9
20.9
-
-
8.5
8.5
-
-
23.9
23.9
-
-
5.2
5.2
-
-
0.062
0.062
Figure 9: Grade Tonnage Curve for the Monogorilby deposit detailing an inferred resource for Available Alumina (Avl_Al2O3%).
16 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. Figure 10: Monogorilby mineralised domain Interpretation screen shot, looking north-north-west.
PRELIMINARY METALLURGICAL TEST-WORK
Preliminary scoping metallurgical test-work including size reduction, scrubbing and sizing was completed at
Core Resources laboratory in Brisbane, Australia on representative 25 to 50kg bulk samples of the surface
duricrust and bauxite resource. This work was carried out, to test whether a ‘premium quality’ DSO product
could be easily beneficiated through simple crushing, scrubbing and screening.
The first two tests (sample one and two) were carried out on surface duricrust material collected from the
plateau margin and top from outcrop and by backhoe pitting respectively. The third metallurgical sample was
collected by air-core drilling and designed to assess the beneficiation characteristics of the sub-surface bauxite
material. Two air-core drill holes were twinned with two resource drill holes, representative of the average
resource grade. Drill cuttings were then combined to form a single 50kg bulk sample, representative of the
average resource grade for preliminary sighter metallurgical test-work.
Figure 11: Staged metallurgical sampling; surface duricrust outcrop (left), top plateau backhoe pitting (middle) and aircore drilling (right).
Annual Report | 2016 | 17
DIRECTORS REPORT CONTINUED. Results of metallurgical test-work to date on surface duricrust and the top 1-3m of plateau material, demonstrate
that 44-36% alumina and 14-3% silica head-grade material can be beneficiated through simple crushing,
screening and scrubbing to a good to premium quality DSO bauxite at 44-52% alumina (>36% available alumina)
and 2-5% silica (>2% reactive silica), at 85-5% mass-recovery respectively.
Results of preliminary metallurgical test-work to date on sub-surface bauxite material through the mineralised
profile and representative of the resource grade, demonstrate that 36% alumina and 8% silica head-grade
material can be beneficiated through simple crushing and screening to a fair quality DSO bauxite at 38%
alumina (28.7% available alumina) and 10.7% silica (>10.6% reactive silica), at 38% mass-recovery.
The proportion split of the maiden 54.9Mt resource tonnage representative of the surface duricrust and top
1-3m of plateau material (1st phase metallurgical test-work) relative to the sub-surface bauxite material (second
stage test-work) is currently undefined. However, it is reasonable to estimate that 10-25% of the current resource
potentially represents surface material whilst the remainder represents the bulk of the resource.
ADDITIONAL RESOURCE POTENTIAL
Drilling to date has defined bauxite occurring over the Monogorilby plateau alone (used for the current resource
estimate); however, drilling has also intersected high-grade ‘blind’ DSO bauxite under cover within the valleys
floors, termed ‘Valley Fill Bauxite’. Several drill holes intersected high-grade DSO valley fill bauxite in the
current resource drilling programme which were not included in the maiden resource estimate and provide
additional scope for a resource upgrade.
Drilling intersections including 6m at 39% total alumina and 2.2% total silica in hole MON046 and 4m at 36.8%
total alumina and 4.5% total silica in hole MON040 demonstrate the additional potential within the immediate
project area. High available alumina to reactive silica ratios and supporting petrographic work confirm gibbsite
dominant mineralisation; a potential source of “premium” DSO bauxite used as a “sweetener” in the alumina
refining process.
X-ray diffraction studies of representative samples have confirmed that gibbsite is the main mineral species
present in the bauxite layer. Gibbsite is the preferred bauxite mineralogy for low-temperature, low pressure
refining to alumina, and the target type bauxite ore of new refineries coming on line in India and China. Low
pressure and low temperature treatment technologies are cost efficient to operate.
The Company has identified additional high-grade titanium results within the resource drilling with grades
consistently reported between 3.8% to 5% TiO2. Preliminary mineralogical work using QEMSCAN has identified
rutile and ilmenite as the main titanium bearing phases occurring within the bauxite profile. The downhole
grade profile from resource drilling indicates a surface enriched titanium zone that progressively reduces
in grade down the bauxite profile. Additional resource potential exists for a high-grade pre-strip titanium
concentrate.
MAJOR NEW BAUXITE PROVINCE
The Company moved quickly to secure exploration rights through license approvals and applications covering
1,484km2 of prospective host lithologies for both “plateau type” and “valley fill” type bauxite targets, providing
exciting resource growth potential.
Targets include extensive plateau zones within the Mount Redhead and Coco forest areas to the north with
confirmed bauxite occurrences, as well as potential extensive “blind” targets lying buried below the Durong
plateau to the south (see figure 12).
18 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. Figure 12: Province scale tenure; major target areas defined and maiden resource area.
Figure 13: Examples of DSO bauxite outcrops and scarp face channel sampling
Annual Report | 2016 | 19
DIRECTORS REPORT CONTINUED. MAY QUEEN GOLD PROJECT
Subsequent to the reporting period, the Company identified historical high-grade gold drill intersections at the
May Queen Prospect within its wholly owned Monogorilby license package, Central Queensland Australia.
Historic drilling completed during the late 1980s by Black Swan Pacific NL intersected multiple high-grade gold
intervals including 2m @ 73.4 g/t Au (including 1m at 145g/t) in hole BPH1 and 4m @ 38.8g/t Au (at end of hole)
and 3m @ 18.9g/t Au in hole BPH15, over an approximate 100m strike, which remains open in both directions
and at depth.
The Company is planning a percussion drilling programme to test the historic intersections and continuations
along strike at the May Queen Prospect. The magnetic anomalies undercover 2km to 8km to the south-east will
be further investigated for potential mineralisation. The mineralisation appears to be hosted within numerous
parallel quartz vein systems open to the north-west and south-east, projected to extend under cover and
concealed below younger sediments.
The Intersections appear to occur at or close to the contact between intrusive andesite porphyritic dykes and
gabbros, and a mixed mudstone – limestone sedimentary package. The licence area is largely covered by a thin
sandstone cover sequence which is believed to mask additional areas of potentially extensive mineralisation.
The Company has also identified potential exoskarns beside the intrusive contact with visible secondary copper
mineralisation at surface and endo skarns within the exposed intrusives. Likewise, elevated zinc anomalism is
reported within stream sediments draining the broader project area. IronRidge considers this to be indicative of
potentially mineralise basement.
The May Queen Prospect is also characterised by a discrete magnetic anomaly, spatially associated with
historical drill intersections. Additional magnetic anomalies occur along strike to the south-east of the May
Queen prospect under approximately 20m to 50m of younger cover sediments. Potential exists for the discovery
of additional high-grade gold mineralisation concealed below the younger cover sequence in settings similar to
May Queen, 2km to 8km along strike to the south-east and associated with these magnetic anomalies.
ANDESITE PORPHYRY
Figure 14: Historic Drilling Results May Queen Prospect (Gold in metres of grams per ton)
20 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. Figure 15: May Queen location (left) and additional exploration target areas for gold and base metals (right).
QUAGGY PROJECT AREA
The Quaggy license was renewed during the year.
Annual Report | 2016 | 21
DIRECTORS REPORT CONTINUED. CHAD
The Company entered into a conditional share subscription agreement with Tekton Minerals Pte Ltd (‘Tekton’)
subsequent to the reporting period. The agreement provides IronRidge with access to exclusive rights to an
extensive land package and associated major new gold discovery in Chad, Central Africa.
Under the terms of the agreement, IronRidge will invest up to US$3.5m in Tekton for up to a 58% shareholding
(the “Investment”). The Investment will provide IronRidge with a first mover advantage within several highly
prospective, province-scale, gold mineralised belts with little or no modern-day exploration and largely
forgotten due to Chad’s historical oil exploration and production focus.
Tekton has secured exclusive rights over five exploration permits covering a total of 1,000km2, in addition to
400km2 of reconnaissance licences within the Ouaddaï Province; an under-explored yet highly prospective
domain within the Saharan Metacraton of Central Africa.
The Saharan Metacraton represents a potential gold-bearing equivalent to the prolific Birimian Greenstone belt,
known for several world-class gold mines in Ghana, Senegal, Mali, Cote d’Ivoire and Burkina Faso.
To date, three highly prospective, gold mineralised areas including extensive artisanal workings over areas
exceeding 4km2 and one drill-ready target/advanced exploration target with the potential to host a multi-million
ounce gold deposit have been defined over the Dorothe, Echbara and Am Ouchar licenses. Additionally, two
further highly prospective reconnaissance licenses have been awarded within the same province over the Adé
and Nabagay targets. Gold nuggets up to 1cm across, including gold in quartz-vein material and disseminated
gold observed in the project areas.
Historical United Nations Development Programme (“UNDP”, 1990’s) field work defined a 100-300ppb gold
in soil anomaly over a 2km strike and 100m to 200m width with best trenching results of 1.29g/t over 28m and
0.61g/t Au over 56m within the Echbara prospect; yet to be drill tested.
Tekton has extensive in-country exploration, logistics and government relations expertise, with experienced and
committed teams in place and demonstrated highly skilled francophone African expertise.
Two further Reconnaissance licenses at Waya Waya in the Northern Ouaddaï region with outcropping and
extensive graphite occurrences and anomalous zinc and uranium mineralisation from preliminary mapping and
rock chip sampling.
Figure 16: Granted license areas (left) and regional geological setting (right, after Liegois, 2005) within Ouaddaï Region of Chad, Central Africa.
22 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. DOROTHE
Mapping and sampling at the Dorothe target to date has defined two distinct gold mineralising events; an early
centimetre scale shallowly westward dipping quartz vein swarm zone over a 3x1km area and later, cross-cutting
sub-vertical 1-5m true thickness, north-south striking quartz vein zone up to 200m wide and over a confirmed
1km of strike with possible extensions up to 3km of strike.
Figure 17: Extensive artisanal workings and gold washing area over the Main Vein (above) and artisanal pitting zone over 3x1km area (below) at the Dorothe
prospect.
The earlier stage quartz vein swarm zone occurs over an approximate 3x1km north-east trending zone at the
apparent flexure of a major north-west striking fault and is clearly defined by extensive artisanal workings into
weathered surface rock. The later stage, cross-cutting sub-vertical quartz vein swarm has been clearly mapped
and sampled by trenching over a 1km strike, with potential for further strike extensions to the north and south
based on recent artisanal mining.
Of the sampling completed to date, over 40% of the rock chip samples collected at the Dorothe target returned
grades over 0.5g/t Au with grades up to 103 g/t, 99.6g/t, 94.5g/t and 82.2 g/t Au. Trenching and channel
sampling across strike of the north-south quartz vein system has returned multiple gold intersections over 10g/t
Au along a combined 1km strike length, with better intersections of 4m at 14.2g/t, 2m at 34.1g/t, 2m at 31.1g/t
and 1m at 63.2 g/t Au. The north-south vein set is not restricted to a single quartz vein, however in places occurs
as multiple splays and sub-parallel veins over a 20m to 50m width.
Annual Report | 2016 | 23
DIRECTORS REPORT CONTINUED. Figure 18: Extensive surface workings defining 3x1km early stage gold mineralised zone and second stage >1km strike high-grade quartz vein zone (inset;
Dorothe license setting over regional geology).
Figure 19: Photomicrograph of gold mineralisation (left), gold mineralised rock-chip samples and gold nuggets (right and below) from the project areas
(centimetre scale, unless shown otherwise).
24 | Annual Report | 2016
DIRECTORS REPORT CONTINUED.
ECHBARA
The Echbara license covers 200km2 and is 25km west of the Dorothe license. Historical work completed by the
UNDP during the 1990’s has defined a 2km long by 150-200m wide 100ppb soil anomaly with highs of 300ppb.
Follow-up trenching by the UNDP has returned results of 58m at 1.29g/t Au and 28m at 1.29g/t Au. Follow-up
trenching by Tekton has returned results of 56m at 0.61g/t Au (including 10m at 0.9g/t Au and 20m at0.87g/t Au)
and 25m at 0.8g/t Au. This target has not been drill tested.
The target occurs within micaceous schists bound to the west by quartzites and east by carbonates with
interpreted cross-cutting north-west orientated faults. A large, late granitic intrusion occurs approximately 3km
to the south-east of the known gold anomalism.
The relationship between granitic intrusions and major structures are thought to be important in localising gold
mineralisation. Tekton is refining this model for application across the other targets in the total project area.
Figure 20: Echbara regional geology map with historical pitting and landscape photo inserts.
AM OUCHAR
The Am Ouchar license covers 200km2 and is 70km south-east of the Dorothe license. Historical work by
the UNDP during the 1990’s indicated that gold mineralisation is hosted within 2-5m thick, shallow dipping
north-east trending quartz veins and within the adjacent hematitic schists. UNDP trenching results included
spectacular intersections of 20m at 6.8g/t Au, 16m at 4.7g/t Au and 12m at 5.7g/t Au with individual 2m
composite grades up to 33g/t Au.
Follow-up channel sampling by Tekton perpendicular to quartz veins and within the adjacent host rock returned
intersections including 2m at 18.2g/t Au, 2m at 14.2g/t Au and 2.3m at 9.9g/t Au, providing confidence in the
reported grades and extension of mineralisation into the adjacent host rock.
Annual Report | 2016 | 25
DIRECTORS REPORT CONTINUED. Figure 21: Extensive artisanal gold workings at Am Ouchar.
OTHER TARGETS
Recently granted licenses covering a total of 400km2 at Nabagay and Adé cover further exciting and highly
prospective geological targets within the Ouaddaï South project portfolio.
The Adé license, located approximately 40km east of Dorothe, occurs within an interpreted ‘pressure-shadow’
adjacent to a large 15km diameter late granitic intrusion. Regional soil sampling by the UNDP during the 1990’s
identified multiple lithium soil anomalies up to 5km in strike length in addition to multiple coincident and
isolated gold in soil anomalies adjacent to the granitic intrusive contact.
The Nabagay license is located approximately 25km north of Dorothe and is considered prospective for gold
mineralisation in similar geological settings as the Dorothe project.
The Waya Waya licenses cover 400km2 within the Ouaddaï North Region, approximately 260km north of the
Dorothe project area. Historical work by the UNDP during the 1990’s and follow-up mapping and rock-chip
sampling by Tekton has identified a 15km long and approximately 50m wide surface graphitic schist occurrence.
Reconnaissance rock chip and channel sampling completed by Tekton has returned results of 11% to 12% total
carbon content (Ct) with historical results by the UNDP up to 18% Ct.
Multi-element geochemical analysis has also indicated potential anomalous uranium and associated pathfinder
elements typically observed in sandstone hosted uranium deposits. Furthermore, anomalous zinc and lead
results have been identified associated with pegmatites.
PROJECT ACCESS
Access to the project area is via a sealed and well maintained 900km bitumen toll road from the capital city
N’Djamena to Abéché, followed by a 200km maintained laterite road to the project area. Travel time from
N’Djamena to the project area is approximately 15 hours by road. International air carriers Air France, Royal
Air Maroc, Turkish Airlines and Ethiopian Airline provide frequent travel into N’Djamena and the project area is
serviced by charter flights and UN aircraft into Goz Beïda taking approximately 2 hours.
THE INVESTMENT
The Company has entered into a conditional share subscription agreement dated 12th August 2016
(“Subscription Agreement”) with Tekton Minerals Pte Ltd (“Tekton”), under which IronRidge has agreed to
26 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. invest up to US$3.5 m in cash in Tekton within an 18 month period following completion of the Subscription
Agreement in return for up to a 58% interest in the issued share capital of Tekton.
It is intended that the funding will be used to undertake further exploration work and to prepare a technical
report compliant with Canadian NI 43-101 or Australian JORC requirements.
From the commencement of the Investment, Nick Mather (Chairman of IronRidge) will be appointed Chairman
of Tekton, Vincent Mascolo (CEO and Managing Director of IronRidge) and Len Kolff (IronRidge’s Country
Manager in Gabon) will join the board of Tekton.
Completion of the Investment is subject to certain conditions being met by Tekton principally in relation to the
securing of Tekton shareholder approvals.
Tekton is a private Singapore registered company, which was established in 2013 and is majority owned by its
management team.
ABOUT CHAD
With a population of 13.6 million (World Bank, 2016), Chad covers a surface area of 1.2 million km2. It is a stable
Republic with a US$2,500 GDP per capita per annum (2013 estimate), is a member of the OHADA and EITI, and
has a projected economic growth of 11.2% (African Economic Outlook, 2014). Major oil companies Total, Exxon,
Chevron and Glencore have been active in Chad for several decades and Chad is a major oil producer and
refiner for the domestic and international markets.
Chad has an attractive Mining Code and investment framework. Mineral exploration licenses are granted for 5
years and are renewable twice for a total additional 10 years. Mining licenses are granted for a 25-years term and
are renewable, with up to a 10-year tax holiday period and a corporate tax rate of 35% (negotiable). The State
has the right for a 10% free carry and 2% royalty.
RESULT FOR THE YEAR
The loss after income tax for the Group for the year ended 30 June 2016 was $2,305,460 (2015: $2,038,074).
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
In the opinion of the Directors, there were no significant changes in the state of affairs of the Group that
occurred during the financial year under review not otherwise disclosed in this report or the financial statements
of the Group for the financial year.
ENVIRONMENTAL REGULATIONS AND PERFORMANCE
The Directors have put in place strategies and procedures to ensure that the Group manages its compliance
with environmental regulations. The Directors are not aware of any breaches of any applicable environmental
regulations.
PROCEEDINGS ON BEHALF OF COMPANY
No person has applied to the Court under section 237 of Corporations Act 2001 for leave to bring proceedings
on behalf of the Company, or to intervene in any proceedings to which the Company is a party, for the purpose
of taking responsibility on behalf of the Company for all or any part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under
section 237 of the Corporations Act 2001.
Annual Report | 2016 | 27
DIRECTORS REPORT CONTINUED. REMUNERATION REPORT
(AUDITED)
This remuneration report for the year ended 30 June
2016 outlines the remuneration arrangements of
the Company and the Group in accordance with the
requirements of the Corporations Act 2001 (the “Act”)
and its regulations. This information has been audited
as required by section 308(3C) of the Act.
The remuneration report details the remuneration
arrangements for key management personnel (“KMP”)
who are defined as those persons having authority and
responsibility for planning, directing and controlling
the activities of the Company and the Group, directly
or indirectly, including any director (whether executive
or otherwise) of the Company, and includes the
executive team.
The remuneration report is presented under the
following sections:
1.
Individual key management personnel disclosures
2. Remuneration policy
3. Non-executive director remuneration
arrangements
4. Executive remuneration arrangements
5. Company performance and the link to
remuneration
6. Executive contractual arrangements
7. Equity instruments disclosures
1. INDIVIDUAL KEY
MANAGEMENT PERSONNEL
DISCLOSURES
KEY MANAGEMENT PERSONNEL
(i) Directors
Nicholas Mather
Executive Chairman
Vincent Mascolo
Managing Director and Chief Executive Officer
Stuart Crow
Non-executive Director
Neil Herbert
Non-executive Director
Bastiaan van Aswegen
Non-executive Director
Alistair McAdam
Non-executive Director
Tsuyoshi Ueda
Non-executive Director (resigned 31 March 2016)
Kenichiro Tsubaki
Non-executive Director (appointed 31 March 2016)
(ii) Executives
Lennard Kolff
Country Manager – Gabon (appointed 1 July 2015)
Karl Schlobohm*
Company Secretary
Priy Jayasuriya*
Chief Financial Officer
Barry Stoffell
Chief Geologist, New Opportunities Group
(resigned 30 June 2015)
Amanda Geard
Business Generation, New Opportunities Group
(resigned 30 June 2015)
* Karl Schlobohm and Priy Jayasuriya were remunerated by DGR
Global Limited up until the Company was admitted to AIM.
There were no changes to KMP after reporting
date and before the date the financial report was
authorized for issue.
2. REMUNERATION POLICY
IronRidge Resources Limited’s remuneration strategy
is designed to attract, motivate and retain employees
and NEDs by identifying and rewarding high
performers and recognising the contribution of
each employee to the continued growth and success
of the Group.
The Board of Directors is responsible for determining
and reviewing compensation arrangements for
the Directors and the Executive team. The Board
assesses the appropriateness of the nature and
amount of remuneration of such officers on a periodic
basis by reference to relevant employment market
conditions with the overall objective of ensuring
28 | Annual Report | 2016
DIRECTORS REPORT CONTINUED.
maximum shareholder benefit from the retention
of a high quality Board and Executive team. Such
officers are given the opportunity to receive their
base remuneration in a variety of forms including cash
and fringe benefits. It is intended that the manner
of payments chosen will be optimal for the recipient
without creating undue cost for the Company.
Further details on the remuneration of Directors and
Executives are set out in this Remuneration Report.
The Company aims to reward the Executives with a
level and mix of remuneration commensurate with
their position and responsibilities within the Company.
The Board’s policy is to align Executive objectives with
shareholder and business objective by providing a
fixed remuneration component and offering long-term
incentives.
In accordance with best practice corporate
governance, the structure of NED and executive
remuneration is separate and distinct.
3. NON-EXECUTIVE
DIRECTOR REMUNERATION
ARRANGEMENTS
The Board seeks to set aggregate remuneration
at a level that provides the Company with the
ability to attract and retain directors of the highest
calibre, whilst incurring a cost that is acceptable to
shareholders. The Company’s specific policy for
determining the nature and amount of remuneration
of Board members of the Company is as follows:
The Constitution of the Company provides that the
NEDs are entitled to remuneration as determined by
the Company in a general meeting to be apportioned
among them in such manner as the Directors agree,
and, in default of agreement, equally. The aggregate
remuneration per annum will be determined at the
next annual general meeting. Additionally,
NEDs are entitled to be reimbursed for properly
incurred expenses.
If a NED performs extra services, which in the
opinion of the Directors are outside the scope of the
ordinary duties of the Director, the Company may
remunerate that Director by payment of a fixed sum
determined by the Directors in addition to or instead
of the remuneration referred to above. However,
no payment can be made if the effect would be to
exceed the maximum aggregate amount payable to
NEDs. A NED is entitled to be paid travelling and
other expenses properly incurred by them in attending
Directors’ or general meetings of the Company
or otherwise in connection with the business of
the Company.
All Directors have the opportunity to qualify for
participation in the Company’s Employee Share
Option Plan (“ESOP”), subject to the approval of
shareholders.
The remuneration of NEDs for the year ended 30
June 2016 is detailed in this Remuneration Report.
4. EXECUTIVE REMUNERATION
ARRANGEMENTS
The Company aims to reward the Executives with a
level and mix of remuneration commensurate with
their position and responsibilities within the Company
and so as to:
•
•
align the interests of the Executives with those of
shareholders;
link reward with the strategic goals and
performance of the Company; and
• ensure total remuneration is competitive by
market standards.
The remuneration of Executives may from time to time
be fixed by the Board. The remuneration will comprise
a fixed remuneration component and also may include
offering specific short and long-term incentives, in the
form of:
• performance based salary increases and/or
bonuses; and/or
the issue of options.
•
The remuneration of the Executives employed on a
full-time basis by the Company for the year ending 30
June 2016 is detailed in this Remuneration Report.
5. COMPANY PERFORMANCE
AND THE LINK TO
REMUNERATION
During the financial year, the Company has generated
losses as its principal activity was mineral exploration.
Up until 12 February 2015, the Company’s ordinary
shares were not traded on any exchange and there
were no dividends paid during the year. On listing
the share price was £0.10. As at 30 June 2015 the
share price was £0.0413 and as at 30 June 2016 it was
£0.0413.
Annual Report | 2016 | 29
DIRECTORS REPORT CONTINUED. As the Company is still in the exploration and
development stage, the link between remuneration,
Company performance and shareholder wealth is
tenuous. Share prices are subject to the influence
of metals prices and market sentiment toward the
sector, and as such increases or decreases may occur
quite independent of Executive performance or
remuneration.
6. EXECUTIVE CONTRACTUAL
ARRANGEMENTS
It is the Board’s policy that employment agreements
are entered into with all Executives.
The current service agreement with the Managing
Director and Chief Executive Officer has a notice
period of three (3) months. All other employment
agreements have one month (or less) notice periods.
Executives are entitled to their statutory entitlements
of accrued annual leave and long service leave
together with any superannuation on termination. No
other termination payments are payable.
The terms of appointment for NEDs are set out in the
letters of appointment.
MANAGING DIRECTOR AND
CHIEF EXECUTIVE OFFICER
The Company has a three (3) year Executive Service
Agreement with Alberona Pty Ltd an entity associated
with Mr Vincent Mascolo, which took effect on 28
February 2014 for the provision of certain consultancy
services. Alberona Pty Ltd will provide Mr Vincent
Mascolo as Executive Director of IronRidge Resources
Limited. Under the terms of the agreement:
• Alberona Pty Ltd is entitled to a base fee for the
services of Mr Mascolo of $180,000 per annum,
increasing to $250,000 per annum on the date the
Company’s shares are admitted to quotation on
the ASX and increasing to $350,000 from the day
the Company has a market capitalisation of equal
to or greater than $100 million.
• Both the Company and Alberona Pty Ltd are
entitled to terminate the contract upon giving
three (3) months written notice.
• The Company is entitled to terminate the
agreement immediately upon the happening of
certain events in respect of Alberona Pty Ltd’s
solvency or certain acts of misconduct;
• Mr Mascolo is entitled to a short-term incentive
equal to 100% of the base fee over the lifetime of
the Executive Service Agreement with Alberona
Pty Ltd on meeting the following key performance
indicators
a) 20% - Share price re-rating;
b) 25% - Project advancement and or
value adding acquisition;
c) 45% - Promotional achievement,
capital management & successful cash
raisings; and
d) 10% - No lost time injury and
adherence to OHES policies; and
• Mr Mascolo is entitled to a long-term Incentive
equal to a maximum of 4% interest in the share
capital of the Company upon meeting certain key
performance indicators as set by the board.
COUNTRY MANAGER AND
EXPLORATION MANAGER
The Company has a two (2) year Executive Service
Agreement with Lennard Kolff, which took effect on 1
July 2015. Under the terms of the agreement:
•
Lennard Kolff is entitled to a base pay of $250,000
per annum.
• Both the Company and Lennard Kolff are entitled
to terminate the contract upon giving three (3)
months written notice.
• The Company is entitled to terminate the
agreement immediately upon certain acts of
misconduct;
• Mr Kolff is entitled to a short-term incentive equal
to 40% of the base pay over the lifetime of the
Executive Service Agreement on meeting the
following key performance indicators
a) 50% - New project acquisition or
pegging on outstanding terms; and
b) 50% - Outstanding delivery of
instrumental contribution to marketing
resulting in a significant transformation
to market capitalisation or financial
statistics.
• Mr Kolff is entitled to participate in the Company
Employee Share Option Plan Scheme.
30 | Annual Report | 2016
DIRECTORS REPORT CONTINUED.
OTHER EXECUTIVES
Employment contracts entered into with Executives contain the following key terms:
Event
Performance based salary increases and/or bonuses
Short and long-term incentives, such as options
Resignation/ notice period
Serious misconduct
Company Policy
Board discretion
Board discretion
1 month
Company mayterminate at any time
Payouts upon resignation or termination, outside industrial regulations
(i.e. ‘golden handshakes’)
None
REMUNERATION OF DIRECTORS AND OTHER KEY MANAGEMENT PERSONNEL
Directors
Nicholas Mather
2016
2015
Vincent Mascolo
2016
2015
Stuart Crow
2016
2015
Neil Herbert1
2016
2015
Bastiaan Van
Aswegen2
2016
2015
Alistair McAdam3
2016
2015
Tsuyoshi Ueda4
2016
2015
Kenichiro Tsubaki5
2016
2015
Total Remuneration
2016
2015
Short Term
Benefits
Salary & Fees
$
Post-
Employment
Superannuation
$
Options
$
Shares
$
Total
$
Consisting of
Options
%
150,000
175,000
293,751
206,666
60,000
55,000
60,000
20,000
60,000
22,857
60,000
22,857
45,000
5,806
15,000
-
743,751
508,187
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
150,000
175,000
293,751
206,666
60,000
55,000
60,000
20,000
60,000
22,857
60,000
22,857
45,000
5,806
15,000
-
743,751
508,187
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Alternate Directors do not receive any form of remuneration for their services.
1 Neil Herbert was appointed 12 February 2015. 2 Bastiaan Van Aswegen was appointed 12 February 2015. 3 Alistair McAdam was appointed 12 February 2015.
4 Tsuyoshi Ueda was appointed 26 May 2015 and resigned 31 March 2016. 5 Kenichiro Tsubaki was appointed 31 March 2016.
Annual Report | 2016 | 31
DIRECTORS REPORT CONTINUED.
REMUNERATION OF DIRECTORS AND OTHER KEY MANAGEMENT PERSONNEL (CONTINUED)
Directors
Lennard Kolff1
2016
2015
Karl Schlobohm2
2016
2015
Priy Jayasuriya2
2016
2015
Barry Stoffell3
2016
2015
Amanda Geard3
2016
2015
Total Remuneration
2016
2015
Short Term
Benefits
Salary & Fees
$
Post-
Employment
Superannuation
$
Options
$
Shares
$
Total
$
Consisting of
Options
%
225,676
10,291
50,000
19,049
50,000
19,049
-
118,503
-
118,503
21,439
3,393
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
325,676
285,395
21,439
-
3,393
-
-
-
-
-
-
-
-
-
-
-
-
-
250,508
10,291
50,000
19,049
50,000
19,049
-
118,503
-
118,503
350,508
285,395
1.4%
-
-
-
-
-
-
-
-
-
-
-
1 Lennard Kolff was appointed 1 July 2015 and provided consulting services to the Company in May and June 2015.
2 Karl Schlobohm and Priy Jayasuriya were remunerated by DGR Global Limited up until the Company was admitted to AIM on 12 February 2015.
3 Barry Stoffell and Amanda Geard resigned on 30 June 2015.
There were no other executives employed or remunerated by the Company or the Group during the years
ended 30 June 2016 and 2015.
PERFORMANCE INCOME AS A PROPORTION OF TOTAL REMUNERATION
There was no performance based remuneration during the year.
32 | Annual Report | 2016
DIRECTORS REPORT CONTINUED.
7. EQUITY INSTRUMENTS DISCLOSURES
Shares and Options issued as part of remuneration for the year ended 30 June 2016
Shares and options may be issued to Directors and Executives as part of their remuneration. The shares and
options are not issued based on performance criteria, but are issued to the majority of Directors and Executives
of the Company to align comparative shareholder return and reward for Directors and Executives.
SHARES AND OPTIONS GRANTED AS REMUNERATION
There were no shares issued as part of remuneration of Directors and other key management personnel during
the financial year ended 30 June 2016 and 2015.
The terms and conditions of the grant of options over ordinary shares affecting remuneration of Directors and
other key management personnel in this financial year or future reporting years are as follow:
Grant Date
Vesting Date and
Exercisable Date
Expiry Date
Exercise Price
Fair Value per Option at
Grant Date
Director Options
Key Management
Personnel Options
31/01/2014
31/01/2014
21/01/2016
21/01/2016
21/01/2016
31/01/2014
31/12/2017
31/01/2014
31/12/2017
21/01/2016
20/01/2017
21/01/2016
20/01/2017
21/01/2016
31/12/2017
£0.10
£0.10
£0.05
£0.08
£0.10
£0.007
£0.007
£0.0006
£0.0009
£0.0016
Options granted carry no dividend or voting rights. There was no amount paid or payable by the recipients.
There were 1,500,000 options issued to Directors and other key management personnel during the year
ended 30 June 2016 (30 June 2015: nil). The number of options over ordinary shares granted to and vested by
Directors and other key management personnel as part of compensation during the year ended 30 June 2016
are set out below:
Number of Options
Granted during the
Year 2016
Number of Options
Vested during the
Year 2016
Directors
Nicholas Mather
Vince Mascolo
Stuart Crow
Other Key Management Personnel
Lennard Kolff
Karl Schlobohm
Priy Jayasuriya
Total
-
-
-
1,500,000
-
-
1,500,00
1,500,000
3,000,000
1,500,000
1,500,00
500,000
500,000
8,500,000
SHARES ISSUED ON EXERCISE OF REMUNERATION OPTIONS
There were no options exercised during the year that were previously granted as remuneration (2015: nil).
Annual Report | 2016 | 33
DIRECTORS REPORT CONTINUED.
ADDITIONAL DISCLOSURES RELATING TO KEY MANAGEMENT PERSONNEL
Balance
1 July 2015
Granted as
Compensation
Options
Exercised
Net Change
Other
Balance
30 June 2016
Shareholdings
Directors
Nicholas Mather
Vincent Mascolo
Stuart Crow
Neil Herbert
Bastiaan Van
Aswegen
Alistair McAdam
Tsuyoshi Ueda
Kenichiro Tsubaki
1,303,703
8,310,291
1,000,000
-
-
-
-
-
Other Key Management Personnel
Lennard Kolff
Karl Schlobohm
Priy Jayasuriya
-
292,500
-
Total
10,906,494
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,303,703
8,310,291
1,000,000
-
-
-
-
-
-
292,500
-
10,906,494
“Net Change Other” above includes the balance of shares held on appointment / resignation, and shares
acquired for cash.
There were no shares held nominally at 30 June 2016 (2015: nil).
Option holdings
Current Year
Balance
1 July 2015
Granted
Exercised
Other
Balance
30 June
2016
Vested at
the end
of the
year
Vested and
exercisable at
the end of the
year
Vested and
unexercisable
at the end of
the year
Directors
Nicholas Mather
1,500,000
Vincent Mascolo
3,000,000
Stuart Crow
Neil Herbert
Bastiaan Van
Aswegen
Alistair McAdam
Tsuyoshi Ueda
Kenichiro Tsubaki
1,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
Other Key Management Personnel
Lennard Kolff
Karl Schlobohm
Priy Jayasuriya
-
1,500,000
500,000
500,000
-
-
Total
7,000,000 1,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,500,000
1,500,000
3,000,000
3,000,000
1,500,000
1,500,000
1,500,000
3,000,000
1,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,500,000
1,500,000
1,500,000
500,000
500,000
500,000
500,000
500,000
500,000
8,500,000 8,500,000
8,500,000
-
-
-
-
-
-
-
-
-
-
-
-
There were no options held nominally at 30 June 2016 (2015: nil).
34 | Annual Report | 2016
DIRECTORS REPORT CONTINUED. LOANS TO KEY MANAGEMENT PERSONNEL
There were no loans to Directors or other key management personnel during the year.
OTHER TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL
There were no other transactions or balances with key management personnel during the period.
(END OF REMUNERATION REPORT)
DIRECTORS’ MEETINGS
The number of meetings of Directors held during the year and the number of meetings attended by each
Director was as follows:
Number of meetings held while in office
Meetings attended
Nicholas Mather
Vincent Mascolo
Stuart Crow
Neil Herbert
Bastiaan Van
Aswegen
Alistair McAdam
Tsuyoshi Ueda
Kenichiro Tsubaki
Christelle Van der Merwe
7
7
7
7
7
7
4
3
7
6
7
7
7
7
7
4
3
7
INDEMNIFICATION AND INSURANCE OF DIRECTORS, OFFICERS
AND AUDITOR
Each of the Directors and Secretary of the Company has entered into a Deed with the Company whereby the
Company has provided certain contractual rights of access to books and records of the Company to those
Directors. The Company has insured all of the Directors. The contract of insurance prohibits the disclosure of
the nature of the liabilities covered and amount of the premium paid. The Corporations Act does not require
disclosure of the information in these circumstances.
The Company has not indemnified or insured its auditor.
OPTIONS
At the date of this report, the unissued ordinary shares of IronRidge Resources Limited under option are as
follows:
Grant date
31 January 2014
21 January 2016
21 January 2016
21 January 2016
Date of Expiry
31 December 2017
20 January 2017
20 January 2018
20 January 2019
Exercise Price
Number under Option
£0.10
£0.05
£0.08
£0.10
13,270,000
400,000
500,000
600,000
Annual Report | 2016 | 35
DIRECTORS REPORT CONTINUED. SIGNIFICANT EVENTS AFTER THE BALANCE DATE
On 10 August 2016, the Company announced that it had entered into a conditional agreement with Tekton
Minerals Pte Ltd (Tekton) of Singapore and its portfolio covering 1,400km2 of highly prospective gold and other
mineral projects in Chad, Central Africa. Under the terms of the agreement, IronRidge will invest up to US$3.5
million to acquire an initial 58% of Tekton, including its projects and team, to advance the Dorothe, Echbara and
Am Ouchar licenses.
On 6 September 2016, the Company announced the acquisition of a highly prospective ‘hard-rock’ lithium
tenement package and associated access rights to an historic (non-JORC compliant) 1.48Mt at 1.66% Li2O
lithium resource in Ghana, West Africa. Under the terms of the agreement, IronRidge can earn up to 100% of
the projects through staged earn in arrangements and expenditure to Feasibility Study within a 4-year period.
On 13 September 2016, the Company announced the right to acquire a highly prospective primary ‘hard-
rock’ lithium exploration license in Cote d’Ivoire, West Africa secured through joint venture. Under the terms
of the agreement, IronRidge can earn up to 100% of the projects through staged earn in arrangements and
expenditure to Feasibility Study within a 4-year period, subject to a residual Net Smelter Royalty.
The Directors are not aware of any other significant changes in the state of affairs of the Group or events after
the balance date that would have a material impact on the consolidated financial statements.
NON-AUDIT SERVICES
There were no non-audit services provided by the entity’s auditor BDO Audit Pty Ltd and its overseas affiliates
during the current year.
AUDITOR’S INDEPENDENCE DECLARATION
The Auditor’s Independence Declaration forms part of the Directors’ Report and can be found on page 37.
Signed in accordance with a resolution of Directors:
Vincent Mascolo
Managing Director and CEO
Brisbane
Date: 20 September 2016
Qualified Person: Information in this report relating to the exploration results is based on data reviewed by Mr Nicholas
Mather (B.Sc. Hons Geol.), Executive Director of the Company. Mr Mather is a Fellow of the Australasian Institute of
Mining and Metallurgy who has in excess of 25 years’ experience in mineral exploration and is a Qualified Person under
the AIM Rules. Mr Mather consents to the inclusion of the information in the form and context in which it appears.
36 | Annual Report | 2016
DIRECTORS REPORT CONTINUED.
AUDITOR’S INDEPENDENCE
DECLARATION
DECLARATION OF INDEPENDENCE BY D P WRIGHT
TO THE DIRECTORS OF IRONRIDGE RESOURCES LIMITED
As lead auditor of IronRidge Resources Limited for the year ended 30 June 2016, I declare that, to the
best of my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of IronRidge Resources Limited and the entities it controlled during the
period.
D P Wright
Director
BDO Audit Pty Ltd
Brisbane,
20 September 2016
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members
of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation, other than for the acts or omissions of financial
services licensees.
Annual Report | 2016 | 37
INTEREST
IN TENEMENTS
As at the date of this report, the Group has an interest in the following tenements.
Tenement
Australia
EPM 18534
EPM 19419
EPM 16260
EPM 16261
EPM 25975
EPM 26110
EPM 26119
EPM 26120
EPM 26122
EPM 26123
EPMA 36118
EPMA 26121
EPMA 26140
Gabon
Authorisation de prospection G6-525
Authorisation de prospection G6-526
Authorisation de prospection G5-533
Interest
%
Grant Date
Application Date
Expiry Date
Term
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
12.10.10
26.08.14
27.06.08
28.05.08
23.02.16
8.04.16
8.04.16
8.04.16
8.04.16
8.04.16
-
-
-
28.06.13
28.06.13
05.12.13
11.10.16
25.08.17
11.06.17
27.05.17
22.02.19
8.03.19
8.03.19
8.03.19
8.03.19
8.03.19
-
-
-
11.12.15
11.12.15
29.01.16
-
-
-
27.06.16
27.06.16
04.12.16
6 years
3 years
9 years
9 years
3 years
3 years
3 years
3 years
3 years
3 years
-
-
-
3 years
3 years
3 years
38 | Annual Report | 2016
CONSOLIDATED STATEMENT
OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
For the year ended 30 June 2016.
Revenue
Administration and consulting
expenses
Depreciation
Employee benefits expenses
Exploration costs written-off
Legal expenses
Interest expense
Unrealised foreign exchange losses
Listing costs expensed
Share based payments
(Loss) before income tax
Income tax expense
(Loss) for the year
Other comprehensive income
Total comprehensive income
for the year attributable
to the owners of IronRidge
Resources Limited
Loss per share
Basic loss per share
Diluted loss per share
Notes
2
16
3
4
8
8
2016
$
5,763
2015
$
916
(1,628,013)
(944,867)
(4,856)
(106,810)
(26,798)
(17,240)
(57)
(524,056)
-
(3,393)
(4,030)
(55,404)
(47,990)
(62,718)
(2)
-
(923,979)
-
(2,305,460)
(2,038,074)
-
-
(2,305,460)
(2,038,074)
-
-
(2,305,460)
(2,038,074)
Cents / share
Cents / share
(1.0)
(1.0)
(1.2)
(1.2)
The above consolidated statement of comprehensive income should be read in conjunction with the
accompanying notes.
Annual Report | 2016 | 39
CONSOLIDATED STATEMENT
OF FINANCIAL POSITION
As at 30 June 2016.
Current assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Total current assets
Non-current assets
Other financial assets
Property, plant and equipment
Exploration and evaluation
assets
Total non-current assets
Total assets
Current liabilities
Notes
9
10
11
12
13
Trade and other payables
14
Total current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity attributable to
owners of IronRidge
Resources Limited
15
16
2016
$
2014
$
10,719,669
14,947,231
48,834
8,959
36,154
-
10,777,462
14,983,385
53,666
35,460
5,139,993
5,229,119
16,006,581
424,860
424,860
424,860
53,666
8,768
3,117,009
3,179,443
18,162,828
279,040
279,040
279,040
15,581,721
17,883,788
25,777,728
175,104
(10,371,111)
25,777,728
171,711
(8,065,651)
15,581,721
17,883,788
The above consolidated statement of financial position should be read in conjunction with the
accompanying notes.
40 | Annual Report | 2016
CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
For the year ended 30 June 2016.
Issued Capital Accumulated Losses
Share Based
Payments Reserve
Total Equity
$
$
Balance at 30 June 2014
6,661,258
(6,027,577)
Loss for the year
Other comprehensive income
Total comprehensive income for the year
Shares issued during the year
Share issue costs, net of tax
-
-
-
19,753,273
(636,803)
(2,038,074)
-
(2,038,074)
-
-
$
171,711
-
-
-
-
-
$
805,392
(2,038,074)
-
(2,038,074)
19,753,273
(636,803)
Balance at 30 June 2015
25,777,728
(8,065,651)
171,711
17,883,788
Loss for the year
Other comprehensive income
Total comprehensive income for the year
Share based payments
-
-
-
-
(2,305,460)
-
(2,305,460)
-
-
-
-
3,393
(2,305,460)
-
(2,305,460)
3,393
Balance at 30 June 2016
25,777,728
(10,371,111)
175,104
15,581,721
The above consolidated statement of changes in equity should be read in conjunction with the accompanying
notes.
Annual Report | 2016 | 41
CONSOLIDATED STATEMENT
OF CASH FLOWS
For the year ended 30 June 2016.
Cash flows from operating activities
Notes
Receipts from customers
(including GST)
Payments to suppliers and
employees (including GST)
Interest received
Interest paid
Net cash flows from
operating activities
Cash flows from investing activities
Payments for security deposits
Refund of security deposits
Purchase of property, plant
and equipment
Payments for exploration and
evaluation assets
Net cash flows from
investing activities
Cash flows from financing activities
Proceeds from the issue
of shares
Transactions costs on the issue
of shares
Net cash flows from
financing activities
Net increase / (decrease) in
cash and cash equivalents
Cash and cash equivalents at
the beginning of the year
Net foreign exchange impact
Cash and cash equivalents at
the end of the year
2016
$
2015
$
148,371
122,627
(1,768,322)
(1,502,615)
5,763
-
916
(2)
19
(1,614,188)
(1,379,074)
-
-
(31,548)
(2,057,770)
(2,500)
11,937
(1,788)
(1,593,043)
(2,089,318)
(1,585,394)
-
-
-
(3,703,506)
14,947,231
(524,056)
19,723,290
(2,076,144)
17,647,146
14,682,678
27,600
236,953
9
10,719,669
14,947,231
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
42 | Annual Report | 2016
NOTES TO THE
FINANCIAL STATEMENTS
NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
CORPORATE INFORMATION
The consolidated financial report of IronRidge
Resources Limited for the year ended 30 June
2016 was authorised for issue in accordance with a
resolution of the Directors on 20 September 2016.
IronRidge Resources Limited is a public company
limited by shares incorporated and domiciled in
Australia. IronRidge Resources Limited is the ultimate
parent. The Group’s registered office is located at
Level 27, One One One, 111 Eagle Street, Brisbane,
QLD 4000.
The nature of the operations and principal activities of
the Group are described in the Directors’ report.
BASIS OF PREPARATION
This financial report is a general purpose financial
report that has been prepared in accordance with
Australian Accounting Standards, including Australian
Accounting Interpretations, other authoritative
pronouncements of the Australian Accounting
Standards Board and the Corporations Act 2001. The
Group is considered a for-profit entity for the purpose
of Australian Accounting Standards.
The financial report covers the Group comprising of
IronRidge Resources Limited and its subsidiaries and is
presented in Australian dollars.
Compliance with IFRS
Australian Accounting Standards include Australian
Equivalents to International Financial Reporting
Standards (AIFRS). Compliance with AIFRS ensures
that the financial statements and notes of IronRidge
Resources Limited comply with International Financial
Reporting Standards (IFRS).
Going concern
The financial statements have been prepared on a
going concern basis which contemplates the continuity
of normal business activities and the realisation of
assets and discharge of liabilities in the ordinary
course of business. The Group has not generated
revenues from operations. As such, the Group’s ability
to continue to adopt the going concern assumption
will depend upon a number of matters including
subsequent successful raisings in the future of
necessary funding and the successful exploration and
subsequent exploitation of the Group’s tenements.
Existing cash reserves are considered to be adequate
to fund the planned expenditure for at least 12 months
from the date of this report.
Reporting basis and conventions
The financial report has been prepared on an accruals
basis and is based on historical costs modified by
the revaluation of selected non-current assets, and
financial assets and financial liabilities for which the fair
value basis of accounting has been applied.
The following is a summary of the material accounting
policies adopted by the Group in the preparation of
the financial report.
ACCOUNTING POLICIES
(a) New Accounting Standards and
Interpretations
The accounting policies adopted are consistent with
those of the previous financial year except as follows:
The Company has adopted the following new and
amended Australian Accounting Standards and AASB
Interpretations as of 1 July 2015:
Reference
Title
AASB 2015-3 Amendments to
Australian Accounting
Standards arising from
the Withdrawal of AASB
1031 Materiality
AASB 2015-5 Amendments to
Australian Accounting
Standards – Investment
Entities: Applying the
Consolidation Exception
Application
date of
standard
Application
date for the
Company
1 July
2015
1 July 2015
1 July
2015
1 July 2015
The adoption of the above standards and
interpretations did not have any material impact on
the current or any prior period and is not likely to
materially affect future periods.
Australian Accounting Standards and Interpretations
that have been recently issued or amended but are not
yet effective have not been adopted by the Company
for the annual reporting period ended 30 June 2016.
Annual Report | 2016 | 43
NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
The Consolidated Entity is yet to evaluate the impact of those standards and interpretations on the financial statements.
The Company anticipates that all of the relevant pronouncements will be adopted in the Company’s accounting
policies for the first period beginning after the effective date of the pronouncement. Information of new
standards, amendments and interpretations that are expected to be relevant to the Company’s financial
statements is provided below.
Reference
Title
AASB 14
Regulatory deferral accounts
AASB 2014-3
AASB 2014-4
Amendments to Australian Accounting Standards – Accounting for Acquisitions of
Interests in Joint Operations [AASB 1 & AASB 11]
Clarification of Acceptable Methods of Depreciation and Amortisation
(Amendments to AASB 116 and AASB 138)
AASB 15
Revenue from Contracts with Customers
AASB 2014-9
Amendments to Australian Accounting Standards – Equity Method in
Separate Financial Statements
Application Date
of Standard
Application Date
for the Company
1 January 2016
1 July 2016
1 January 2016
1 July 2016
1 January 2016
1 July 2016
1 January 2018
1 July 2018
1 January 2016
1 July 2016
AASB 2014-10
Amendments to Australian Accounting Standards – Sale or Contribution of
Assets between an Investor and its Associate or Joint Venture
1 January 2016
1 July 2016
AASB 2015-1
Amendments to Australian Accounting Standards – Annual Improvements to
Australian Accounting Standards 2012–2014 Cycle
1 January 2016
1 July 2016
AASB 2015-2
Amendments to Australian Accounting Standards – Disclosure Initiative:
Amendments to AASB 101
1 January 2016
1 July 2016
AASB 2015-3
AASB 2015-5
AASB 2015-9
Amendments to Australian Accounting Standards arising from the
Withdrawal of AASB 1031 Materiality
Amendments to Australian Accounting Standards – Investment Entities:
Applying the Consolidation Exception
Amendments to Australian Accounting Standards – Scope and Application
Paragraphs [AASB 8, AASB 133 & AASB 1057]
AASB 16
Leases
AASB 2016-1
AASB 2016-2
Amendments to Australian Accounting Standards – Recognition of Deferred
Tax Assets for Unrealised Losses [AASB 112]
Amendments to Australian Accounting Standards – Disclosure Initiative:
Amendments to AASB 107
1 July 2016
1 July 2016
1 July 2016
1 July 2016
1 January 2016
1 July 2016
1 January 2019
1 January 2017
1 July 2019
1 July 2017
1 January 2017
1 July 2017
AASB 9
Financial Instruments
1 January 2017
1 July 2017
44 | Annual Report | 2016
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
at acquisition date, separately from goodwill, the
identifiable assets acquired, the liabilities assumed
and any non-controlling interest in the acquiree. The
identifiable assets acquired and the liabilities assumed
are measured at their acquisition date fair values.
The difference between the above items and the fair
value of consideration (including the fair value of any
pre-existing investment in the acquiree) is goodwill or
discount on acquisition.
After initial recognition, goodwill is measured at cost
less any accumulated impairment losses. For the
purpose of impairment testing, goodwill acquired in
a business combination is, from the acquisition date,
allocated to each of the Group’s cash generating units
that are expected to benefit from the combination,
irrespective of whether other assets or liabilities of the
acquiree are assigned to those units.
Where goodwill forms part of a cash generating unit
and part of the operation within that unit is disposed
of, the goodwill associated with the operation
disposed of is included in the carrying amount of
the operation when determining the gain or loss on
disposal of the operation. Goodwill disposed of in this
circumstance is measured based on the relative values
of the operation disposed of and the portion of the
cash generating unit retained.
Non-controlling interests are allocated their
share of net profit after tax in the statement of
comprehensive income and presented within equity
in the consolidated statement of financial position,
separately from the equity of the owners of the parent.
Losses are attributed to the non-controlling interest
even if that results in a deficit balance.
A change in ownership interest of a subsidiary that
does not result in a loss of control, is accounted for as
an equity transaction.
(b) Basis of Consolidation
The consolidated financial statements comprise the
financial statements of IronRidge Resources Limited
and its subsidiaries as at and for the period ended 30
June each year (the “Group”).
Subsidiaries
Subsidiaries are all those entities over which the
consolidated entity has control. The consolidated
entity controls an entity when the consolidated entity
is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect
those returns through its power to direct the activities
of the entity. Subsidiaries are fully consolidated
from the date on which control is transferred to the
consolidated entity. They are de-consolidated from the
date that control ceases.
The financial statements of the subsidiaries are
prepared for the same reporting period as the parent
company, using consistent accounting policies. In
preparing the consolidated financial statements, all
intercompany balances, transactions, unrealized gains
and losses resulting from intra-group transactions and
dividends have been eliminated in full.
Subsidiaries are fully consolidated from the date on
which control is obtained by the Group and cease
to be consolidated from the date on which control is
transferred out of the Group.
Investments in subsidiaries held by IronRidge
Resources Limited are accounted for at cost in the
separate financial statements of the parent entity less
any impairment charges. Dividends received from
subsidiaries are recorded as a component of other
revenues by the parent entity, and do not impact
the recorded cost of the investment. Upon receipt
of dividend payments from subsidiaries, the parent
will assess whether any indicators of impairment of
the carrying value of the investment in the subsidiary
exist. Where such indicators exist, to the extent
that the carrying value of the investment exceeds its
recoverable amount, an impairment loss is recognised.
The acquisition of subsidiaries is accounted for
using the acquisition method of accounting. The
acquisition method of accounting involves recognising
Annual Report | 2016 | 45
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
Joint Arrangements
Joint Operations
The proportionate interests in the assets, liabilities
and expenses of a joint operation activity have been
incorporated in the financial statements under the
appropriate headings.
Joint Ventures
Investments in joint ventures are accounted for using
the equity method. Under the equity method, the
share of the profits or losses of the joint venture
is recognised in profit or loss and the share of
the movements in equity is recognised in other
comprehensive income. Investments in joint ventures
are carried in the statement of financial position at
cost plus post-acquisition changes in the consolidated
entity’s share of net assets of the joint venture.
Goodwill relating to the joint venture is included in
the carrying amount of the investment and is neither
amortised nor individually tested for impairment.
Dividends receivable from joint venture entities
reduces the carrying amount of the investment.
Changes in Ownership Interests
The Group treats transactions with non-controlling
interests that do not result in a loss of control as
transactions with equity owners of the Group. A
change in ownership interest results in an adjustment
between the carrying amounts of the controlling
and non-controlling interests to reflect their relative
interests in the subsidiary. Any difference between the
amount of the adjustment to non-controlling interests
and any consideration paid or received is recognised
in a separate reserve within equity attributable to
owners of IronRidge Resources Limited.
When the Group ceases to have control, or significant
influence, any retained interest in the entity is
remeasured to its fair value with the change in carrying
amount recognised in profit or loss. The fair value
is the initial carrying amount for the purposes of
subsequently accounting for the retained interest as an
associate or financial asset. In addition, any amounts
previously recognised in other comprehensive income
in respect of that entity are accounted for as if the
Group had directly disposed of the related assets or
liabilities. This may mean that amounts previously
recognised in other comprehensive income are
reclassified to profit or loss.
If the ownership interest in an associate is reduced but
significant influence is retained, only a proportionate
share of the amounts previously recognised in other
comprehensive income are reclassified to profit or loss
where appropriate.
(c) Business Combinations
Business combinations are accounted for using the
acquisition method. The consideration transferred
in a business combination is measured at fair value,
which is calculated as the sum of the acquisition date
fair values of the assets transferred by the acquirer, the
liabilities incurred by the acquirer to former owners
of the acquiree and the equity issued by the acquirer,
and the amount of any non-controlling interest in the
acquiree. For each business combination, the acquirer
measures the non-controlling interest in the acquiree
either at fair value or at the proportionate share of
the acquiree’s identifiable net assets. Acquisition-
related costs are expensed as incurred, and included
in administrative expenses.
When the Group acquires a business, it assesses the
financial assets and liabilities assumed for appropriate
classification and designation in accordance with
contractual terms, economic conditions, the Group’s
operating or accounting policies and other pertinent
conditions as at the acquisition date.
If the business combination is achieved in stages, the
acquisition date fair value of the acquirer’s previously
held equity interest in the acquiree is remeasured to
fair value through profit and loss.
Any contingent consideration to be transferred
by the acquirer will be recognised at fair value at
the acquisition date. Subsequent changes to the
fair value of the contingent consideration which is
deemed to be an asset or liability will be recognised
in accordance with AASB 139 either in profit or loss or
as a change to other comprehensive income. If the
contingent consideration is classified as equity, it is not
remeasured.
(d) Operating Segments
An operating segment is a component of an entity
that engages in business activities from which it may
earn revenues and incur expenses, whose operating
results are regularly reviewed by the entity’s chief
46 | Annual Report | 2016
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
operating decision maker to make decisions about
resources to be allocated to the segment and assess
its performance and for which discrete financial
information is available. This may include start-up
operations which are yet to earn revenues.
Operating segments that meet the quantitative criteria
as prescribed by AASB 8, Operating Segments are
reported separately. However, an operating segment
that does not meet the quantitative criteria is still
reported separately where information about the
segment would be useful to users of the financial
statements.
Information about other operating segments that
are below the quantitative criteria are combined
and disclosed in a separate category for “all other
segments”.
(e) Cash and Cash Equivalents
For the statement of cash flows, cash and cash
equivalents include cash on hand, deposits held at call
with banks, other short term highly liquid investments
with original maturities of three months or less, and
bank overdrafts. Bank overdrafts are shown within
short-term borrowings in current liabilities on the
statement of financial position.
(f) Trade and Other Receivables
Receivables generally have 30-60 day terms, are
recognised initially at fair value and subsequently
measured at amortised cost using the effective interest
method, less an allowance for impairment.
Collectability of receivables is reviewed on an
ongoing basis. Individual debts that are known to
be uncollectible are written off when identified. An
impairment provision is recognised when there is
objective evidence that the Group will not be able
to collect the receivable. Financial difficulties of
the debtor or debts more than 90 days overdue are
considered objective evidence of impairment. The
amount of the impairment loss is the receivable
carrying amount compared to the present value of
estimated future cash flows, discounted at the original
effective interest rate.
(g) Financial Instruments
Recognition and Initial Measurement
Financial instruments, incorporating financial assets
and financial liabilities, are recognised when the entity
becomes a party to the contractual provisions of the
instrument. Trade date accounting is adopted for
financial assets that are delivered within timeframes
established by marketplace convention.
Financial instruments are initially measured at fair
value plus transactions costs where the instrument
is not classified as at fair value through profit or loss.
Transaction costs related to instruments classified as at
fair value through profit or loss are expensed to profit
or loss immediately. Financial instruments are classified
and measured as set out below.
Classification and Subsequent Measurement
(i)
(ii)
(iii)
Loans and receivables
Loans and receivables are non-derivative
financial assets with fixed or determinable
payments that are not quoted in an active
market and are subsequently measured
at amortised cost using the effective interest
rate method.
Financial liabilities
Non-derivative financial liabilities (excluding
financial guarantees) are subsequently
measured at amortised cost using the effective
interest rate method.
Available-for-sale financial assets
Available for sale financial assets comprise
investments in listed entities. These
investments are recorded at cost.
Derecognition
Financial assets are derecognised where the
contractual rights to receipt of cash flows expires
or the asset is transferred to another party whereby
the entity no longer has any significant continuing
involvement in the risks and benefits associated
with the asset. Financial liabilities are derecognized
where the related obligations are either discharged,
cancelled or expire. The difference between the
carrying value of the financial liability extinguished or
transferred to another party and the fair value
of consideration paid, including the transfer of
non-cash assets or liabilities assumed is recognised
in profit of loss.
Annual Report | 2016 | 47
NOTES TO THE FINANCIAL STATEMENTS CONTINUED.
NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(h) Property, Plant & Equipment
Property, plant & equipment are stated at historical
cost less accumulated depreciation and any
accumulated impairment losses.
The cost of property, plant & equipment constructed
within the Group includes the cost of materials, direct
labour, borrowing costs and an appropriate portion
of fixed and variable costs. Subsequent costs are
included in the asset’s carrying amount or recognised
as a separate asset, as appropriate, only when it is
probable that future economic benefits associated
with the item will flow to the Group and the cost of the
item can be measured reliably. All other repairs and
maintenance are charged to the profit or loss during
the financial year in which they are incurred.
Depreciation
The depreciable amount of all property, plant &
equipment is depreciated over their useful life to
the Group commencing from the time the asset is
held ready for use. Leasehold improvements are
depreciated over the shorter of either the unexpired
period of the lease or the estimated useful lives of the
improvements.
The depreciation rates used for each class of assets
are:
Class of Property, Plant &
Equipment
Depreciation
Plant & Equipment
10% - 15% Straight line
Office Equipment
33.3% Straight line
Gains and losses on disposals are determined by
comparing proceeds with the carrying amount. These
are included in the statement of comprehensive
income.
Derecognition
An item of property, plant and equipment is
derecognised upon disposal or when no further
future economic benefits are expected from its use or
disposal.
(i) Exploration and Evaluation Assets
Exploration and evaluation expenditure incurred
is accumulated in respect of each identifiable area
of interest. Such expenditures comprise net direct
costs and an appropriate portion of related overhead
expenditure but do not include overheads or
administration expenditure not having a specific nexus
with a particular area of interest. These assets are only
carried forward to the extent that they are expected
to be recouped through the successful development
of the area or where activities in the area have not yet
reached a stage which permits reasonable assessment
of the existence of economically recoverable reserves
and active or significant operations in relation to the
area are continuing.
A regular review has been undertaken on each area
of interest to determine the appropriateness of
continuing to carry forward assets in relation to that
area of interest.
A provision is raised against exploration and
evaluation expenditure where the Directors are of the
opinion that the carried forward net cost may not be
recoverable or the right of tenure in the area lapses.
The increase in the provision is charged against the
results for the year. Accumulated costs in relation to
an abandoned area are written off in full against profit
in the year in which the decision to abandon the area
is made.
When production commences, the accumulated costs
for the relevant area of interest are amortised over the
life of the area according to the rate of depletion of
the economically recoverable reserves.
Costs of site restoration are provided over the life of
the area 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 structure, waste
removal, and rehabilitation of the site in accordance
with clauses of mining permits. Such costs have
been determined using estimates of future costs,
current legal requirements and technology on an
undiscounted basis.
Any changes in the estimates for the costs are
accounted on a prospective basis. In determining
the costs of site restoration, there is uncertainty
regarding the nature and extent of the restoration
due to community expectations and future legislation.
Accordingly the costs have been determined on the
basis that restoration will be completed within one
year of abandoning the site.
48 | Annual Report | 2016
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(j)
Impairment of Assets
Employee Benefits
At each reporting date, the Group reviews the carrying
values of its tangible 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 it recoverable amount is expensed
to the profit or loss.
Where it is not possible to estimate the recoverable
amount of an individual asset, the Group estimates
the recoverable amount of the cash-generating unit to
which the asset belongs.
(k) Trade and Other Payables
Trade and other payables are carried at amortised
cost and due to their short term nature they are not
discounted. They represent liabilities for goods and
services provided to the Group prior to the end of
the financial year that are unpaid and arise when the
Group becomes obliged to make future payments in
respect of the purchase of these goods and services.
The amounts are unsecured and are usually paid within
30-60 days of recognition.
(l) Provisions and Employee Benefits
Provisions are recognised when the Group has a
present obligation (legal or constructive) as a result of
a past event, it is possible that an outflow of resources
embodying economic benefits will be required to
settle the obligation and a reliable estimate can be
made of the amount of the obligation.
When the Group expects some or all of a provision to
be reimbursed, the reimbursement is recognised as
a separate asset but only when the reimbursement is
virtually certain. The expense relating to any provision
is presented in the statement of comprehensive
income net of any reimbursement.
Provisions are measured at the present value of
management’s best estimate of the expenditure
required to settle the present obligation at the
reporting date. The discount rate used to determine
the present value reflects current market assessments
of the time value of money and the risks specific to the
liability. The increase in the provision resulting from
the passage of time is recognised in finance costs.
(i) Wages, salaries and annual leave
Liabilities for wages and salaries, including non-
monetary benefits and annual leave expected
to be settled within 12 months of the reporting
date are recognised in respect of employees’
services up to the reporting date. They are
measured at the amounts expected to be paid
when the liabilities are settled. Expenses for non-
accumulating sick leave are recognised when the
leave is taken and measured at the rates paid or
payable.
(ii) Long service leave
The liability for long service leave is recognised
and measured as the present value of expected
future payments to be made in respect of services
provided by employees up to the reporting
date. Consideration is given to expected future
wages and salary levels, experience of employee
departures, and periods of service. Expected
future payments are discounted using market
yields at the reporting date on Australian
corporate bonds with terms to maturity and
currencies that match, as closely as possible, the
estimated future cash outflows.
(m) Leases
Leases of property, plant & equipment where
substantially all the risks and benefits incidental to the
ownership of the asset, but not the legal ownership,
are transferred to the Group 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 year.
Leased assets are depreciated on a straight line basis
over their estimated useful lives where it is likely that
the Group will obtain ownership of the asset or over
the term of the lease.
Lease payments for operating leases, where
substantially all the risks and benefits remain with the
lessor, are charged as expenses on a straight line basis.
Annual Report | 2016 | 49
NOTES TO THE FINANCIAL STATEMENTS CONTINUED.
NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
Lease incentives under operating leases are
recognised as a liability and amortised on a straight-
line basis over the life of the lease term.
(n) Share Capital
Ordinary shares are classified as equity at the time that
they are issued. Costs directly attributable to the issue
of new shares or options are shown as a deduction
from the equity proceeds, net of any income tax
benefit.
(o) Share-Based Payments
The Group may provide benefits to Directors,
employees or consultants in the form of share-based
payment transactions, whereby services may be
undertaken in exchange for shares or options over
shares (“equity-settled transactions”).
The fair value of options granted to Directors,
employees and consultants is recognised as an
employee benefit expense with a corresponding
increase in equity (share option reserve). The fair
value is measured at grant date and recognised
over the period during which the recipients become
unconditionally entitled to the options. Fair value
is determined using a Black-Scholes option pricing
model. An expense is still recognised for options that
do not ultimately vest because a market condition was
not met.
Where the terms of options are modified, the expense
continues to be recognised from grant date to vesting
date as if the terms had never been changed. In
addition, at the date of the modification, a further
expense is recognised for any increase in fair value of
the transaction as a result of the change.
Where options are cancelled, they are treated
as if vesting occurred on cancellation and any
unrecognised expenses are taken immediately to the
profit or loss. If new options are substituted for the
cancelled options and designated as a replacement,
the combined impact of the cancellation and
replacement options are treated as if they were a
modification.
(p) Revenue
Revenue is recognised and measured at the fair value
of the consideration received or receivable to the
extent it is probable that the economic benefits will
flow to the Group and the revenue can be reliably
measured. The following specific recognition criteria
must also be met before revenue is recognised:
Interest
Interest revenue is recognized as interest accrues
using the effective interest rate method. This is a
method of calculating the amortised cost of a financial
asset and allocating the interest income over the
relevant period using the effective interest rate, which
is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial
asset to the net carrying amount of the financial asset.
All revenue is stated net of the amount of goods and
services tax (GST).
(q)
Income Tax
The income tax expense for the period is the tax
payable on the current period’s taxable income
rate for each jurisdiction adjusted by changes in
deferred tax assets liabilities attributable to temporary
differences between the tax base of assets and
liabilities and their carrying amounts in the financial
statements, and to unused tax losses.
The charge for current income tax expense is based on
the profit for the year adjusted for any non-assessable
or disallowed items. It is calculated using the tax rates
that have been enacted or are substantially enacted by
the balance date.
Deferred tax is accounted for using the balance sheet
liability method in respect of temporary differences
arising between the tax bases of assets and liabilities
and their carrying amounts in the financial statements.
No deferred income tax will be recognised from the
initial recognition of an asset or liability, excluding
a business combination, where there is no effect on
accounting or taxable profit or loss.
Deferred tax is calculated at the tax rates expected
to apply to the period when the asset is realised or
liability is settled. Deferred tax is recognised in the
statement of comprehensive income except where
it relates to items that may be recognised directly
in equity, in which case the deferred tax is adjusted
directly against equity. Deferred income tax assets are
recognised to the extent that it is probable that future
tax profits will be available against which deductible
temporary differences can be utilised.
The amount of benefits brought to account or
which may be realised in the future is based on the
assumption that no adverse change will occur in
50 | Annual Report | 2016
NOTES TO THE FINANCIAL STATEMENTS CONTINUED.
NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
income taxation legislation and the anticipation that
the group will derive sufficient future assessable
income to enable the benefit to be realised and
comply with the conditions of deductibility imposed
by the law.
Current tax assets and liabilities are offset where
a legally 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 relate 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.
(r) GST
Revenues, expenses and assets are recognised net
of GST except where GST incurred on a purchase
of goods and services is not recoverable from the
taxation authority, in which case the GST is recognised
as part of the cost of acquisition of the asset or as part
of the expense item.
Receivables and payables are stated with the amount
of GST included. The net amount of GST recoverable
from, or payable to, the taxation authority is included
as part of receivables or payables in the statement of
financial position.
Cash flows are included in the statement of cash flows
on a gross basis and the GST component of cash flows
arising from investing and financing activities, which is
recoverable from, or payable to, the taxation authority,
are classified as operating cash flows.
Commitments and contingencies are disclosed net of
the amount of GST recoverable from, or payable to,
the taxation authority.
(s) Earnings per Share
Basic earnings per share is calculated as net profit (loss)
attributable to members of the parent, adjusted to
exclude any costs of servicing equity other than ordinary
shares, divided by the weighted average number of
ordinary shares, adjusted for any bonus element.
Diluted earnings per share adjust the figures used in
the determination of basic earnings per share to take
into account:
• The after tax effect of interest and other financing
costs associated with dilutive potential ordinary
shares; and
• The weighted average number of additional
ordinary shares that would have been outstanding
assuming the conversion of all dilutive potential
ordinary shares.
(t) Comparatives
When required by Australian Accounting Standards,
comparative figures have been adjusted to conform to
changes in presentation for the current financial year.
(u) Fair value measurement
When an asset or liability, financial or non-financial,
is measured at fair value for recognition or disclosure
purposes, the fair value is based on the price that
would be received to sell an asset or paid to transfer
a liability in an orderly transaction between market
participants at the measurement date; and assumes
that the transaction will take place either: in the
principle market; or in the absence of a principal
market, in the most advantageous market.
Fair value is measured using the assumptions that
market participants would use when pricing the
asset or liability, assuming they act in their economic
best interest. For non-financial assets, the fair value
measurement is based on its highest and best use.
Valuation techniques that are appropriate in the
circumstances and for which sufficient data are
available to measure fair value, are used, maximising
the use of relevant observable inputs and minimising
the use of unobservable inputs.
Assets and liabilities measured at fair value are
classified, into three levels, using a fair value hierarchy
that reflects the significance of the inputs used
in making the measurements. Classifications are
reviewed each reporting date and transfers between
levels are determined based on a reassessment of the
lowest level input that is significant to the fair value
measurement.
For recurring and non-recurring fair value
measurements, external valuers may be used when
internal expertise is either not available or when
Annual Report | 2016 | 51
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
the valuation is deemed to be significant. External
valuers are selected based on market knowledge
and reputation. Where there is a significant change
in fair value of an asset or liability from one period to
another, an analysis is undertaken, which includes a
verification of the major inputs applied in the latest
valuation and a comparison, where applicable, with
external sources of data.
(v)
Critical Accounting Estimates and
Judgments
The Directors evaluate estimates and judgments
incorporated into the financial report based on
historical knowledge and best available current
information. Estimates assume a reasonable
expectation of future events and are based on current
trends and economic data, obtained both externally
and within the Group.
Key estimates – impairment
The Group assesses impairment at each reporting
date by evaluating conditions specific to the Group
that may lead to impairment of assets. Where an
impairment trigger exists, the recoverable amount of
the asset is determined. Where applicable, value-in-
use calculations performed in assessing recoverable
amounts incorporate a number of key estimates.
Key judgments – exploration & evaluation assets
The Group performs regular reviews on each area
of interest to determine the appropriateness of
continuing to carry forward costs in relation to that
area of interest. These reviews are based on detailed
surveys and analysis of drilling results performed to
balance date.
The Directors have assessed that for the exploration
and evaluation assets recognised at 30 June 2016,
the facts and circumstances do not suggest that
the carrying amount of an asset may exceed its
recoverable amount. In considering this the Directors
have had regard to the facts and circumstances
that indicate a need for an impairment as noted in
Accounting Standard AASB 6 “Exploration for and
Evaluation of Mineral Resources”.
Exploration and evaluation assets at 30 June 2016
were $5,139,993 (2015: $3,117,009).
Key judgments – share based payment transactions
The Group measures the cost of equity settled
transactions with employees by reference to the fair
value of the equity instruments at the date at which
they are granted. The fair value is determined by
using the Black-Scholes model taking into account the
terms and conditions upon which the instruments were
granted. The accounting estimates and assumptions
relating to equity settled share based payments would
have no impact on the carrying amounts of assets and
liabilities within the next annual reporting period but
may impact the profit or loss and equity.
NOTE 2. REVENUE
- Interest received
- Other revenue
Total Revenue
(a) Interest revenue from:
- At call deposits held with financial institutions
Total Interest Revenue
52 | Annual Report | 2016
2016
2015
$
5,763
-
$
916
-
5,763
916
5,763
5,763
916
916
NOTES TO THE FINANCIAL STATEMENTS CONTINUED.
NOTE 3. PROFIT / (LOSS)
Included in the profit / (loss) are the following specific expenses:
Depreciation
- Office equipment
- Plant & equipment
Defined contributions superannuation expense
Foreign exchange (gains) losses
NOTE 4. INCOME TAX
(a) Components of income tax expense (benefit)
Income tax expense (benefit) is made up of:
Current tax
Deferred tax
(b) The prima facie tax on profit / (loss) before income tax is
reconciled to the income tax expense as follows:
2016
$
596
4,260
21,856
2015
$
749
3,281
1,502
524,056
(236,954)
2016
2015
$
-
-
$
-
-
Prima facie tax on profit / (loss) before income tax at 30% (2015: 30%)
(691,638)
(611,422)
Add tax effect of:
Permanent differences
Current tax loss not recognised
Current year temporary difference not recognised
Deferred tax not recognised
Other items
Income tax expense
Deferred Tax Asset (at 30%)
Recognised temporary differences
Recognised Unused tax losses
Capital raising costs
Total deferred tax assets recognised
Deferred Tax Liability
Recognised timing differences
Net deferred tax recognised
Unrecognised deferred tax assets comprised of:
Deferred tax assets: Net unrecognised tax losses
Deferred tax assets: Gross unrecognised tax losses
759
-
-
754,229
(63,350)
-
163,421
282,585
-
446,006
-
457,643
153,779
-
-
-
7,500
159,346
76,159
243,005
(446,006)
(243,005)
-
-
2,621,147
8,737,157
2,198,689
5,848,410
In order to recoup carried forward losses in future periods, either the Continuity of Ownership Test (COT)
or Same Business Test must be passed. The majority of losses are carried forward at 30 June 2016 under COT.
Deferred tax assets which have not been recognised as an asset, will only be obtained if:
(i)
(ii)
(iii)
the Company derives future assessable income of a nature and of an amount sufficient to enable
the losses to be realised;
the Company continues to comply with the conditions for deductibility imposed by the law; and
no changes in tax legislation adversely affect the Company in realising the losses.
Annual Report | 2016 | 53
NOTES TO THE FINANCIAL STATEMENTS CONTINUED.
NOTE 5. KEY MANAGEMENT PERSONNEL
KEY MANAGEMENT PERSONNEL COMPENSATION
The total remuneration of Key Management Personnel for the Group for the year was as follows:
Short term employee benefits
Post-employment benefits
Share based payments
Total
2016
$
1,069,427
21,439
3,393
1,094,259
2015
$
793,582
-
-
793,582
Refer to the Remuneration Report contained in the Directors’ Report for details of the remuneration paid or
payable to each member of the Group’s Key Management Personnel.
NOTE 6. DIVIDENDS AND FRANKING CREDITS
There were no dividends paid or recommended during the year or since the end of the year. There are no
franking credits available to shareholders of the Company.
NOTE 7. AUDITORS REMUNERATION
Amounts received or due and receivable by BDO (Australia)
An audit or review of the financial report of
the entity or any other entity in the consoli-
dated group
Other services in relation to the entity and
any other entity in the consolidated group
Tax compliance
Assurance related
Amounts received or due and receivable by
BDO (Overseas)
Other services in relation to the
entity and any other entity in the
consolidated group
Assurance related
Total
2016
$
25,000
-
-
25,000
-
25,000
2015
$
25,000
-
54,850
79,850
140,653
220,503
54 | Annual Report | 2016
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 8. LOSS PER SHARE (EPS)
(a) Loss
Loss used to calculate basic and diluted EPS
(b) Weighted average number of shares and options
Weighted average number of
ordinary shares outstanding during the year, used in
calculating basic loss per share
Weighted average number of
dilutive options outstanding during the year
Weighted average number of ordinary shares and potential
ordinary shares outstanding during the year, used in
calculating diluted loss per share
2016
$
2015
$
(2,305,460)
(2,038,074)
Number of Shares
Number of Shares
236,612,203
175,002,292
-
-
236,612,203
175,002,292
The options are considered non-dilutive as they were out of the money.
Options may become dilutive in the future.
NOTE 9. CASH AND CASH EQUIVALENTS
Cash at bank
Total
NOTE 10. TRADE AND OTHER RECEIVABLES
GST receivable
Other receivables
Total
2016
$
10,719,669
10,719,669
2015
$
14,947,231
14,947,231
2016
$
34,436
14,398
48,834
2015
$
36,154
-
36,154
Receivables are non-interest bearing and are generally on 30-60 day terms. A provision for impairment loss is
recognised when there is objective evidence that an individual receivable is impaired. No impairment loss has
been recorded for the current and previous financial year.
Due to the short term nature of these receivables, their carrying value is assumed to approximate fair value.
The maximum exposure to credit risk is the carrying value of receivables. Collateral is not held as security.
The receivables are not exposed to foreign exchange risk. No receivables were past due or impaired at 30
June 2016 (2015: nil).
Annual Report | 2016 | 55
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 11. OTHER FINANCIAL ASSETS – NON-CURRENT
Security deposits
Investment in shares at cost
Total
2016
$
49,666
4,000
53,666
NOTE 12. PROPERTY, PLANT AND EQUIPMENT
Plant & Equipment
– at cost
Accumulated
depreciation
Written down value
Office equipment
– at cost
Accumulated
depreciation
Written down value
Total written down value
2016
$
64,363
(30,062)
34,301
4,189
(3,030)
1,159
35,460
Reconciliation of carrying amounts at the beginning and of the year
Plant & Equipment
Office Equipment
Year ended 30 June 2016
At 1 July 2015 net of accumulated depreciation
Additions
Disposals
Depreciation charge for the year
At 30 June 2015 net of
accumulated depreciation
Year ended 30 June 2015
At 1 July 2014 net of
accumulated depreciation
Additions
Disposals
Depreciation charge for the year
At 30 June 2015 net of
accumulated depreciation
56 | Annual Report | 2016
$
7,013
31,548
-
(4,260)
34,301
$
10,294
-
-
(3,281)
7,013
$
1,755
-
-
(596)
1,159
$
716
1,788
-
(749)
1,755
2015
$
49,666
4,000
53,666
2015
$
32,815
(25,802)
7,013
4,189
(2,434)
1,755
8,768
Total
$
8,768
31,548
-
(4,856)
35,460
$
11,010
1,788
-
(4,030)
8,768
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 13. EXPLORATION AND EVALUATION ASSETS
Exploration and evaluation assets
Movements in carrying amounts
Balance at the
beginning of the year
Additions
Written-off during the year
Balance at the end of the year
2016
$
5,139,993
3,117,009
2,049,782
(26,798)
5,139,993
2015
$
3,117,009
1,590,815
1,574,184
(47,990)
3,117,009
The recoverability of the carrying amount of exploration and evaluation assets is dependent on the successful
development and commercial exploitation or alternatively, sale of the respective areas of interest.
NOTE 14. TRADE AND OTHER PAYABLES
Trade payables
Accrued expenses
Employee benefits
2016
$
159,842
218,323
46,695
424,860
2015
$
157,261
114,763
7,016
279,040
Trade payables are non-interest bearing and are generally on 30-60 day terms.
Due to the short term nature of these payables, their carrying value is assumed to approximate fair value.
NOTE 15. ISSUED CAPITAL
(a)
Issued and paid up capital
236,612,203 (2015: 236,612,203) ordinary
shares fully paid
Share issue costs
2016
$
26,485,820
(708,092)
25,777,728
2015
$
26,485,820
(708,092)
25,777,728
Ordinary shares participate in dividends and the proceeds on winding up the Company in proportion to the
number of shares held. At shareholder meetings each ordinary share is entitled to one vote when a poll is called,
otherwise each shareholder has one vote on a show of hands.
Annual Report | 2016 | 57
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 15. ISSUED CAPITAL (CONTINUED)
(b) Reconciliation of issued and paid-up capital
At 1 July 2014
Shares issued for cash (US$0.12 per share, equivalent to $0.138 per share –
24/11/14)
Shares issued for cash (£0.10 per share, equivalent to $0.20 per share – 11/02/15,
net of share issue costs)
At 30 June 2015
At 30 June 2016
(c) Options
Number of Shares
135,907,155
4,166,666
$
6,661,258
574,618
96,538,382
18,541,852
236,612,203
25,777,728
236,612,203
25,777,728
As at 30 June 2016, there were 14,770,000 (2015: 13,270,000) unissued ordinary shares of IronRidge Resources
Limited under option held as follows:
• 13,270,000 unlisted options to take up one ordinary share in IronRidge Resources Ltd at an exercise price of
£0.10. The options vested immediately and expire 31 December 2017.
• 400,000 unlisted options to take up one ordinary share in IronRidge Resources Ltd at an exercise price of
£0.05. The options vested immediately and expire 20 January 2017.
• 500,000 unlisted options to take up one ordinary share in IronRidge Resources Ltd at an exercise price of
£0.08. The options vested immediately and expire 20 January 2018.
• 600,000 unlisted options to take up one ordinary share in IronRidge Resources Ltd at an exercise price of
£0.10. The options vested immediately and expire 20 January 2019.
(d) Capital Risk Management
When managing capital, management’s objective is to ensure the entity continues as a going concern as well
as to maintain optimal returns to shareholders and benefits for other stakeholders. Management also aims to
maintain a capital structure to ensure the lowest costs of capital available to the Group.
The Group’s capital comprises equity as shown in the statement of financial position. The Group is not exposed
to externally imposed capital requirements.
58 | Annual Report | 2016
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 16. SHARE BASED PAYMENTS
The expense recognised for share based payments received during the year is shown in the table below:
Expense arising from equity settled share-based payment transactions
Bonus share issues
No share issues occurred during the year ended 30 June 2016 and 2015.
Employee share option plan (ESOP)
2016
2015
$
3,393
$
-
Share options are granted to employees. The employee share option plan is designed to align participants’
interests with those of shareholders by increasing the value of the Company’s shares.
When a participant ceases employment after the vesting of their share options, the share options are forfeited
after 90 days unless cessation of employment is due to termination for cause, whereupon they are forfeited
immediately or death. The Company prohibits KMP from entering into arrangements to protect the value of
unvested ESOP awards.
Each option can be exercised from vesting date to expiry date for one share with the exercise price payable in cash.
Options granted
On 21 January 2016, 1,500,000 IronRidge Resources Ltd share options were granted to an employee under the
Employee Share Option Plan. The options are to take up one ordinary share in IronRidge Resources at varying
exercise prices from £0.05 to £0.10. The options vested immediately and are due to expire between 20 January
2017 and 20 January 2019. The following table illustrates the number (no.) and weighted average exercise prices
(WAEP) of, and movements in, share based payment share options granted during the year:
Outstanding at the beginning of the year
Granted during the year
Forfeited during the year
Exercised during the year
Expired during the year
2016
No.
13,270,000
1,500,000
-
-
-
Outstanding at the end of the year
Exercisable at the end of the year
14,770,000
14,770,000
2016
WAEP
£0.10
£0.08
-
-
-
£0.10
£0.10
2015
No.
13,270,000
-
-
-
-
13,270,000
13,270,000
The weighted average remaining contractual life of the options was 1.5 years (2015: 2.5 years).
IronRidge Resources Ltd (ESOP)
Weighted average exercise price
Weighted average life of the option
Underlying share price
Expected share price volatility
Risk free interest rate
Number of options issued
Fair value (black-scholes) per option
Total value of options issued
2016
£0.08
2.13 years
£0.0163
72.736%
1.78%
1,500,000
£0.0006-£0.0016
£1,647
2015
WAEP
£0.10
-
-
-
-
£0.10
£0.10
2015
-
-
-
-
-
-
-
-
Annual Report | 2016 | 59
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 17. ACCUMULATED LOSSES
Accumulated losses at the beginning of the year
Losses after income tax expense
Accumulated losses attributable to members of IronRidge Resources
Limited at the end of the year
2016
$
(8,065,651)
(2,305,460)
(10,371,111)
2015
$
(6,027,577)
(2,038,074)
(8,065,651)
NOTE 18. INFORMATION RELATING TO IRONRIDGE RESOURCES
LIMITED (“THE PARENT ENTITY”)
Current assets
Total assets
Current liabilities
Total liabilities
Net Assets
Issued capital
Share based payment reserve
Accumulated losses
Loss of the parent entity
Total comprehensive loss of
the parent entity
2016
$
10,732,225
16,813,218
388,391
388,391
16,424,827
25,777,728
175,104
(9,528,005)
(2,299,525)
2015
$
14,983,457
19,220,235
257,064
499,277
18,720,958
25,777,728
171,711
(7,228,480)
(2,034,079)
(2,299,525)
(2,034,079)
The parent does not have any guarantees in relation to the debts of its subsidiaries, contingent liabilities or
contractual obligations to purchase fixed assets at 30 June 2016 (2015: nil).
NOTE 19. CASH FLOW RECONCILIATION
Loss after income tax
Non-cash operating items
-
-
-
-
Write back of exploration expenditure
Depreciation
Share based payments
IPO costs expensed
Changes in operating assets and liabilities*
(Increase) decrease in trade and other receivables
(Increase) decrease in othercurrent assets
Increase (decrease) in trade and other payables*
Net cash flows from operating activities
* Net of amounts relating to exploration and evaluation assets.
60 | Annual Report | 2016
2016
$
2015
$
(2,305,460)
(2,038,074)
26,798
4,855
3,393
524,056
(13,863)
8,959
47,990
4,030
-
-
(6,729)
386,476
137,074
(228,233)
(1,614,188)
(1,379,074)
NOTES TO THE FINANCIAL STATEMENTS CONTINUED.
NOTE 20. RELATED PARTY DISCLOSURES
(a) Subsidiaries
The consolidated financial statements include the financial statements of IronRidge Resources Limited and the
subsidiaries listed in the following table:
Name
Eastern Exploration Pty Ltd
Milingui Pty Ltd (formerly Quiver Coal Pty Ltd)
Belinga Holdings Pty Ltd1
Gabon Exploration Pty Ltd2
Lithium of Africa Pty Ltd3
IronRidge Botswana Pty Ltd
IronRidge Gabon SA
Country of Incorporation
Equity Interest (%)
2016
2015
Australia
Australia
Australia
Australia
Australia
Botswana
Gabon
100
100
100
100
100
100
100
100
100
-
-
-
100
100
1 Belinga Holdings Pty Ltd is a private company limited by shares and was incorporated on 15 March 2016.
2 Gabon Exploration Pty Ltd is a private company limited by shares and was incorporated on 15 March 2016.
3 Lithium of Africa Pty Ltd is a private company limited by shares and was incorporated on 21 April 2016.
(b) Ultimate parent
IronRidge Resources Limited is the ultimate parent, which is incorporated in Australia. DGR Global Ltd ceased
being the ultimate parent entity on 12 February 2015 following the IPO of IronRidge Resources Limited.
(c) Key management personnel
Details relating to key management personnel, including remuneration paid, are included in the Directors’
report and note 5.
(d) Transactions with related parties
The following table provides the total amount of transactions that were entered into with related parties for the
relevant financial year:
Related Party
DGR Global Limited (i)
Hopgood Ganim Lawyers (ii)
Sales to Related
Parties
Purchases from
Related Parties
Other Transactions with
Related Parties
2016
2015
2016
2015
-
-
-
-
288,000
288,000
11,302
214,108
-
-
-
-
(i) The Company has a commercial arrangement with DGR Global Limited for the provision of various services, whereby DGR Global Limited provides resources and services
including the provision of its administration and exploration staff, its premises (for the purposes of conducting the Company’s business operations), use of existing office
furniture, equipment and certain stationery, together with general telephone, reception and other office facilities (‘‘Services’’). In consideration for the provision of the Services,
the Group pays DGR Global Limited a monthly management fee. For the year ended 30 June 2016, $288,000 was paid or payable to DGR Global Limited (2015: $288,000) for
the provision of the Services. The total amount outstanding at year end was $28,522 (2015: $40,913).
(ii) Mr Brian Moller (a Director of the former ultimate parent entity DGR Global Limited), is a partner in the Australian firm Hopgood Ganim lawyers. For the year ended 30 June
2016, $11,302 was paid or payable to Hopgood Ganim (2015: $214,108) for the provision of legal services to the Group. The services were based on normal commercial terms
and conditions. The total amount outstanding at year end was $9,540 (2015: $3,297).
The outstanding balances at each relevant year end are unsecured, interest free and settlement occurs in cash.
All outstanding amounts payable comprise current liabilities.
Annual Report | 2016 | 61
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 21. CAPITAL COMMITMENTS
FUTURE EXPLORATION COMMITMENTS
The Group has certain obligations to expend minimum amounts on exploration in tenement areas. These
obligations may be varied from time to time and are expected to be fulfilled in the normal course of operations
of the Group. The commitments are as follows:
Less than 12 months
Between 12 months and 5 years
2016
$
4,405,513
3,422,593
2015
$
13,405,048
3,094,808
7,828,106
16,499,856
To keep tenements in good standing, work programs should meet certain minimum expenditure requirements.
If the minimum expenditure requirements are not met, the Group has the option to negotiate new terms or
relinquish the tenements. The Group also has the ability to meet expenditure requirements by joint venture or
farm-in agreements.
NOTE 22. FINANCIAL RISK
MANAGEMENT
(a) General objectives, policies and processes
In common with all other businesses, the Group is
exposed to risks that arise from its use of financial
instruments. This note describes the Group’s
objectives, policies and processes for managing those
risks and the methods used to measure them. Further
quantitative information in respect of these risks is
presented throughout these financial statements.
There have been no substantive changes in the
Group’s exposure to financial instrument risks, its
objectives, policies and processes for managing those
risks or the methods used to measure them from
previous years unless otherwise stated in this note.
The Group’s financial instruments consist mainly of
deposits with banks, receivables and payables.
The Board has overall responsibility for the
determination of the Group’s risk management
objectives and policies and, whilst retaining ultimate
responsibility for them, it has delegated the authority
for designing and operating processes that ensure
the effective implementation of the objectives and
policies to the Group’s finance function. The Group’s
risk management policies and objectives are therefore
designed to minimise the potential impacts of these
risks on the results of the Group where such impacts
may be material.
The overall objective of the Board is to set polices that
seek to reduce risk as far as possible without unduly
affecting the Group’s competitiveness and flexibility.
Further details regarding these policies are set out
below:
(b) Credit Risk
Credit risk is the risk that the other party to a financial
instrument will fail to discharge their obligation
resulting in the Group incurring a financial loss.
This usually occurs when debtors fail to settle their
obligations owing to the Group. The Group’s
objective is to minimise the risk of loss from credit risk
exposure.
The maximum exposure to credit risk, excluding the
value of any collateral or other security, at balance
date to recognised financial assets, is the carrying
amount, net of any provisions for impairment of those
assets, as disclosed in the statement of financial
position and notes to the financial statements.
Credit risk is reviewed regularly by the Board. It
arises from exposure to receivables as well as through
deposits with financial institutions and available-for-
sale financial assets.
The Group does not have any material credit risk
exposure to any single debtor or group of debtors
under financial instruments entered into by the Group
and at balance date.
Bank deposits are held with Macquarie Bank Limited,
Westpac Banking Corporation Limited and B.I.C.I. Du
Gabon.
62 | Annual Report | 2016
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 22. FINANCIAL RISK MANAGEMENT (CONTINUED)
(c) Liquidity Risk
Liquidity risk is the risk that the Group may encounter difficulties raising funds to meet financial obligations as
they fall due. The objective of managing liquidity risk is to ensure, as far as possible, that the Group will always
have sufficient liquidity to meets its liabilities when they fall due, under both normal and stressed conditions.
Liquidity risk is reviewed regularly by the Board.
The Group manages liquidity risk by monitoring forecast cash flows and liquidity ratios such as working capital.
The Group did not have any financing facilities available at balance date.
(d) Market Risk
Market risk arises from the use of interest bearing, tradable and foreign currency financial instruments. It is the
risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in interest
rates (interest rate risk), foreign exchange rates (currency risk) or other market factors (other price risk). The
Group does not have any material exposure to market risk other than interest rate risk.
Interest rate risk
Interest rate risk arises principally from cash and cash equivalents. The objective of interest rate risk management is
to manage and control interest rate risk exposures within acceptable parameters while optimising the return.
Foreign currency risk
Foreign currency risk is that the risk that the fair value of future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. The Group’s exposure to the risk of changes in foreign exchange
rates relates primarily to the Group’s bank deposits held in British Sterling Pound and the United States Dollar.
The Group manages its foreign currency risk by matching as best as possible its foreign exploration spends with
the foreign currency it holds. Interest rate risk is managed with a mixture of fixed and floating rate debt. For
further details on interest rate risk refer to the tables below:
Floating
Interest Rate
Fixed
Interest Rate
Non-Interest
Bearing
Total Carrying
Amount as per the
Balance Sheet
Weighted
Average Effective
Interest Rate
2016
$
2016
$
(i) Financial assets
Cash and cash equivalents
10,719,669
Trade and other receivables
Other financial assets
-
-
Total financial assets
10,719,669
(ii) Financial liabilities
Trade and other payables
Non-interest-bearing loans
Total financial liabilities
-
-
-
-
-
-
-
-
-
-
2016
$
-
48,834
53,666
48,834
53,666
102,500
10,822,169
424,860
-
424,860
-
424,860
424,860
2016
$
2016
%
10,719,669
1.00%
-
-
-
-
Annual Report | 2016 | 63
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. NOTE 22. FINANCIAL RISK MANAGEMENT (CONTINUED)
(c) Liquidity Risk (continued)
Floating
Interest Rate
Fixed
Interest Rate
Non-Interest
Bearing
Total Carrying
Amount as per the
Balance Sheet
Weighted
Average Effective
Interest Rate
2015
$
2015
$
(i) Financial assets
Cash and cash equivalents
14,947,231
Trade and other receivables
Other financial assets
-
-
Total financial assets
14,947,231
(ii) Financial liabilities
Trade and other payables
Non-interest-bearing loans
Total financial liabilities
-
-
-
-
-
-
-
-
-
-
2015
$
-
36,154
53,666
89,820
279,040
-
2015
$
2015
%
14,947,231
1.65%
36,154
53,666
15,037,051
279,040
-
-
-
-
-
279,040
279,040
The table below demonstrates the sensitivity to a reasonably possible change in the United States dollar and the
British pound sterling against the Australian dollar.
Change in US Dollar Rate
Effect on Profit Before Tax
+10%
-5%
+10%
-5%
$
862,896
(431,448)
219,852
(109,926)
Change in British
Sterling Pound Rate
Effect on Profit Before Tax
+5%
-5%
+5%
-5%
$
16,480
(16,480)
290,979
(290,979)
2016
2015
2016
2015
64 | Annual Report | 2016
NOTES TO THE FINANCIAL STATEMENTS CONTINUED.
NOTE 23. OPERATING SEGMENTS
The Group has identified its operating segment based on the internal reports that are reviewed and used by the
Board of Directors (chief operating decision makers) in assessing performance and determining the allocation of
resources. The Group is managed primarily on a geographic basis, that is, the location of the respective areas of
interest (tenements) in Queensland, and Gabon. Operating segments are determined on the basis of financial
information reported to the Board for the Group as a whole. The Group does not yet have any products or
services from which it derives an income.
Accordingly, management currently identifies the Group as having only one reportable segment, being
exploration for base and precious metals. The financial results from this segment are equivalent to the financial
statements of the Group. There have been no changes in the operating segments during the year.
GEOGRAPHICAL INFORMATION
Geographical – Non-Current Assets
Australia
Gabon
2016
$
1,304,013
3,925,106
5,229,119
2015
$
946,850
2,232,593
3,179,443
NOTE 24. SUBSEQUENT EVENTS
On 10 August 2016, the Company announced that it had entered into a conditional agreement with Tekton
Minerals Pte Ltd of Singapore and its portfolio covering 1,400km2 of highly prospective gold and other mineral
projects in Chad, Central Africa. Under the terms of the agreement, IronRidge will invest up to US$3.5 million
to acquire an initial 58% of Tekton, including its projects and team, to advance the Dorothe, Echbara and Am
Ouchar licenses.
On 6 September 2016, the Company announced the acquisition of a highly prospective ‘hard-rock’ lithium
tenement package and associated access rights to an historic (non-JORC compliant) 1.48Mt at 1.66% Li2O
lithium resource in Ghana, West Africa. Under the terms of the agreement, IronRidge can earn up to 100% of
the projects through staged earn in arrangements and expenditure to Feasibility Study within a 4-year period.
On 13 September 2016, the Company announced the right to acquire a highly prospective primary ‘hard-
rock’ lithium exploration license in Cote d’Ivoire, West Africa secured through joint venture. Under the terms
of the agreement, IronRidge can earn up to 100% of the projects through staged earn in arrangements and
expenditure to Feasibility Study within a 4-year period, subject to a residual Net Smelter Royalty.
The Directors are not aware of any other significant changes in the state of affairs of the Group or events after
the balance date that would have a material impact on the consolidated financial statements.
NOTE 25. CONTINGENT ASSETS AND LIABILITIES
There are no contingent assets and liabilities at 30 June 2016 (2015: nil).
Annual Report | 2016 | 65
NOTES TO THE FINANCIAL STATEMENTS CONTINUED. DIRECTORS DECLARATION
In accordance with a resolution of the Directors of IronRidge Resources Limited,
I state that:
1.
In the opinion of the Directors:
(a)
The financial statements and notes of IronRidge Resources Limited for the financial year
ended 30 June 2016 are in accordance with the Corporations Act 2001, including:
(i)
(ii)
Giving a true and fair view of its financial position as at 30 June 2016
and performance; and
Complying with the Accounting Standards (including the Australian
Accounting Interpretations) and the Corporations Regulations 2001.
The financial statements and notes also comply with International Financial Reporting
Standards as disclosed in Note 1;
There are reasonable grounds to believe that the Company will be able to pay its
debts as and when they become due and payable; and
The remuneration disclosures contained in the Remuneration Report comply with
s300A of the Corporations Act 2001.
(b)
(c)
(d)
2.
This declaration has been made after receiving the declarations required to be made to the
Directors in accordance with section 295A of the Corporations Act 2001 for the financial year
ended 30 June 2016.
On behalf of the board
Vincent Mascolo
Managing Director and CEO
Brisbane
Date: 20 September 2016
66 | Annual Report | 2016
Tel: +61 7 3237 5999
Fax: +61 7 3221 9227
www.bdo.com.au
Level 10, 12 Creek St
Brisbane QLD 4000
GPO Box 457 Brisbane
QLD 4001 Australia
INDEPENDENT AUDITOR’S REPORT
To the members of IronRidge Resources Limited
REPORT ON THE FINANCIAL REPORT
We have audited the accompanying financial report
of IronRidge Resources Limited, which comprises the
consolidated statement of financial position as at 30 June
2016, 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, notes comprising a summary of significant accounting
policies and other explanatory information, and the directors’
declaration of the consolidated entity comprising the
company and the entities it controlled at the year’s end or
from time to time during the financial year.
DIRECTORS’ RESPONSIBILITY 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 Note 1, the directors also
state, in accordance with Accounting Standard AASB 101
Presentation of Financial Statements, that the financial
statements comply with International Financial Reporting
Standards.
AUDITOR’S RESPONSIBILITY
Our responsibility is to express an opinion on the financial
report based on our audit. We conducted our audit in
accordance with Australian Auditing Standards. Those
standards require that we comply with relevant ethical
requirements relating to audit engagements and plan
and perform the audit to obtain reasonable assurance
about whether the financial report is free from material
misstatement.
An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the financial
report. The procedures selected depend on the auditor’s
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 company’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 company’s internal
control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of
accounting estimates made by the directors, as well as
evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
INDEPENDENCE
In conducting our audit, we have complied with the
independence requirements of the Corporations Act 2001.
We confirm that the independence declaration required
by the Corporations Act 2001, which has been given to the
directors of IronRidge Resources Limited, would be in the
same terms if given to the directors as at the time of this
auditor’s report.
OPINION
In our opinion:
(a)
the financial report of IronRidge Resources
Limited is in accordance with the Corporations
Act 2001, including:
(i)
(ii)
giving a true and fair view of the
consolidated entity’s financial position as
at 30 June 2016 and of its performance
for the year ended on that date; and
complying with Australian Accounting
Standards and the Corporations
Regulations 2001; and
(b)
the financial report also complies with
International Financial Reporting Standards as
disclosed in Note 1.
REPORT ON THE REMUNERATION REPORT
We have audited the Remuneration Report included in
pages 27 to 35 of the directors’ report for the year ended
30 June 2016. The directors of the company are responsible
for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations
Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
OPINION
In our opinion, the Remuneration Report of IronRidge
Resources Limited for the year ended 30 June 2014
complies with section 300A of the Corporations Act 2001.
BDO AUDIT PTY LTD
D P Wright
Director
Brisbane, 20 September 2016
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities
which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited
by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a
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other than for the acts or omissions of financial services licensees.
Annual Report | 2016 | 67