& Controlled Entities
Annual Report
For the year ended 30 June 2014
Krakatoa Resources Limited
& Controlled Entities
CONTENTS
CORPORATE DIRECTORY .............................................................................................................. 3
DIRECTORS’ REPORT ..................................................................................................................... 4
AUDITOR’S INDEPENDENCE DECLARATION ............................................................................... 14
STATEMENT OF COMPREHENSIVE INCOME .............................................................................. 15
STATEMENT OF FINANCIAL POSITION ........................................................................................ 16
STATEMENT OF CHANGES IN EQUITY ........................................................................................ 17
STATEMENT OF CASH FLOWS ..................................................................................................... 18
NOTES TO THE FINANCIAL STATEMENTS .................................................................................. 19
DIRECTORS’ DECLARATION ......................................................................................................... 36
INDEPENDENT AUDITOR’S REPORT............................................................................................ 37
CORPORATE GOVERNANCE STATEMENT .................................................................................. 39
ASX INFORMATION ....................................................................................................................... 44
SCHEDULE OF MINERAL TENEMENTS ........................................................................................ 47
– 2 –
Krakatoa Resources Limited
& Controlled Entities
CORPORATE DIRECTORY
PRINCIPAL REGISTERED OFFICE
Level 11, 216 St Georges Terrace
Perth WA 6000
Tel: +61 8 9481 0389
Fax: +61 8 9463 6103
Email: info@krakatoaresources.com
Web: www.krakatoaresources.com
DIRECTORS
Aryo Bimo – Executive Director
Roger Pooley - Non-Executive Director
Brian Varndell – Non-Executive Director
COMPANY SECRETARY
David Palumbo
SHARE REGISTRAR
Computershare Investor Services Pty Ltd
Level 2, 45 St Georges Terrace
Perth WA 6000
Tel: +61 8 9323 2000
Fax: +61 8 9323 2033
Web: www.computershare.com.au
AUDITORS
RSM Bird Cameron Partners
8 St Georges Terrace
PERTH WA 6000
LAWYERS
Steinepreis Paganin
Level 4, The Read Buildings
16 Milligan Street
Perth WA 6000
– 3 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ REPORT
Your directors present the following report on Krakatoa Resources Limited and controlled entities (referred to
hereafter as “the Group”) for the financial year ended 30 June 2014.
DIRECTORS
The names of directors in office at any time during the financial year and up to the date of this report are:
Kevin Kwok (Managing Director) - Resigned 1 July 2014
Aryo Bimo (Executive Director) - Appointed 18 December 2013
Brian Varndell (Non-Executive Director) - Appointed 5 December 2013
-
-
-
- Roger Pooley (Non-Executive Director) - Appointed 30 July 2013
-
-
Kent Hunter (Non-Executive Director) - Resigned 5 December 2013
Stephen Brockhurst (Non-Executive Director) - Resigned 15 November 2013
Unless noted above, all directors have been in office since the start of the financial year to the date of this report.
COMPANY SECRETARY
The following persons held the position of company secretary during the financial year:
- David Palumbo
Details of Mr Palumbo’s experience are set out below under ‘Information on Directors’.
PRINCIPAL ACTIVITIES
The principal activity of the Group during the financial year was the acquisition and exploration of precious and
base metal projects in Indonesia.
OPERATING RESULTS
The loss of the Group after providing for income tax amounted to $1,884,114 (2013: $619,264).
FINANCIAL POSITION
As at 30 June 2014, the Company had a cash balance of $61,796 (2013: $1,773,444) and a net asset position of
$1,882,835 (2013: $2,444,957).
DIVIDENDS PAID OR RECOMMENDED
No dividends have been paid, and the directors do not recommend the payment of a dividend for the financial
year ended 30 June 2014.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
The following significant changes in the state of affairs occurred during the financial year:
• On 10 December 2013, Krakatoa Resources Limited signed a Share Purchase and Sale Agreement
(“Purchase Agreement”) with PT. Sitasa Resources to acquire 99.8% of the issued shares of PT. Bina
Citra Sawita, which holds a 100%
Izin Usaha Pertambangan Eksplorasi No.
540/23/IUP/DESDM/Bup-2010, dated 7 July 2010, issued by the Regent of South Solok (“BCS
Tenement”). Krakatoa completed the transaction through payment of US$150,000 on signing of the
Purchase Agreement and the issue of 5,000,000 fully paid ordinary shares on 12 March 2014.
interest
in
• On 12 March 2014, the Group issued 1,000,000 fully paid ordinary shares to Executive Director Aryo
Bimo, pursuant to shareholder approval at the general meeting held on 7 March 2014.
– 4 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ REPORT (CONT.)
REVIEW OF OPERATIONS
On 20 November 2013, Krakatoa Resources Limited announced that the exploration license covering Krakatoa’s
80% owned Donggala Project has been extended by the Regency of Donggala until 8 April 2016.
On 10 December 2013, Krakatoa Resources Limited signed a Share Purchase and Sale Agreement (“Purchase
Agreement”) with PT. Sitasa Resources to acquire 99.8% of the issued shares of PT. Bina Citra Sawita, which
holds a 100% interest in Izin Usaha Pertambangan Eksplorasi No. 540/23/IUP/DESDM/Bup-2010, dated 7 July
2010, issued by the Regent of South Solok (“BCS Tenement”). The transaction was completed on 12 March 2014
with the total consideration for the acquisition being USD$150,000 and 5 million fully paid Krakatoa shares.
PT. Sitasa Resources, is a holding company for the Sitasa Group of Companies (“Sitasa Group”), a well-
established and highly successful exploration and mining company with a proven track record of success in
Indonesian resource projects. Specifically, Sitasa Group is one of Indonesia’s largest high grade iron ore
producers. Krakatoa will gain exclusive access to Sitasa Group’s pipeline of iron ore projects over the next two
years.
The Company also secured up to AUD$5 million in funds to progress the development of its exploration projects
in Indonesia. The funding arrangement consists of a AUD$5 million Standby Subscription Agreement (“the
Facility”) from Gurney Capital Nominees Pty Ltd (“Investor”), a Melbourne based Investment Company.
On 16 April 2014, Krakatoa Resources Limited, via its wholly owned Indonesian subsidiary PT. Bumi Pratama,
signed a Memorandum of Understanding (“MOU”) for the acquisition of 80% of the Shares in PT. Rio Jaya
Persada (“PT. Rio Jaya”). PT. Rio Jaya holds two promising gold exploration licenses in Central Sulawesi.
Krakatoa has the exclusive right, for a period of 18 months, to acquire an 80% interest in PT. Rio Jaya Persada
through:
• Payment of Rp600,000,000 (~AUD$55,996) within 15 working days after the MOU is signed (paid);
• Subject to successful due diligence and early stage exploration, payment of Rp2,400,000,000
(~AUD$223,985).
The Company has continued to evaluate additional tenements of strategic importance to expand the land area
held. This work is ongoing as Krakatoa seeks to acquire further value accretive assets.
– 5 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ REPORT (CONT.)
INFORMATION ON DIRECTORS
Kevin Kwok (BCom, CPA)
Managing Director (resigned 1 July 2014)
Prior to joining the Company, Mr Kwok was a CFO at the Milken Institute
overseeing all financial aspects of a large investment portfolio. He has
extensive strategic business management experience involving complex
financial transactions and operations. These past several years he has
served as a financial advisor, providing financial and accounting services
to the mining industry. He was senior vice-president of finance and
operations at Antar Investments, where Mr Kwok focused on the direct
financial management of a $3 billion international portfolio.
Mr Kwok began his private career as vice-president and corporate
controller for Watt Realty Advisors, Mr Kwok’s primary responsibilities
included direction of the accounting department, and overseeing the
the
accounting and
Company’s $11 billion AUS Centro-Watt REIT portfolio. Before joining
Watt Realty Advisors, Mr Kwok spent five years at Ernst & Young, where
he specialized in both tax consulting and financial reporting, for both
private and publicly held clients.
functions associated with
financial reporting
An active member of the community Mr Kwok’s involvements include:
membership in The American Institute of Certified Public Accountants
(AICPA), Loyola High School Alumni Association, Board Member of the
Oregon Community Solar Project and Heal the Bay.
Interest in Shares (at resignation)
1,000,000 Fully paid ordinary shares
Directorships held in other listed
entities (at resignation)
None
Aryo Bimo
Executive Director (Appointed 18 December 2013)
Mr Bimo is the current Director of Operations at PT. Sitasa Resources
and its operating mines, PT. Sitasa Energi and PT. Tambang Sunai
Sanur. He has led the development of Sitasa Group, one of Indonesia’s
most successful Iron Ore Mining Companies, from its roots as an
exploration Company in 2008 to a significant producer at two separate
mines in less than 5 years.
Mr Bimo graduated from The Institute of Technology Surabaya with a
degree in Civil Engineering. He is fluent in English and Bahasa
Indonesia.
Interest in Shares
1,000,000 Fully paid ordinary shares
Directorships held in other listed
entities
None
– 6 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ REPORT (CONT.)
INFORMATION ON DIRECTORS (CONT)
Brian Varndell (Bsc)
Non-Executive Director (appointed 5 December 2013)
Mr Varndell is a Fellow Member of the Australasian Institute of Mining &
Metallurgy (“AusIMM”) and has over 40 years of experience including
managerial roles and consulting in the capacity of Acting or Chief
Geologist. His experience encompasses all aspects of the resource
sector including exploration, development and mining.
Mr Varndell has worked in the Indonesian mining industry since 1988
and was permanently based in Indonesia between 1994-1999 where he
was the Regional Exploration Manager for Aurora Gold Limited and
helped guide the exploration team to identify over 600,000oz Au
resources which converted into over 350,000oz of reserves at the Indo
Muro Kencana Mt Muro operation and 2.5Moz Au resources at the
Meares Soputan Mining Toka Tindung Project in N. Sulawesi. He has
recently maintained working contact with
Indonesia mainly with
involvement in the coal sector.
Interest in Shares
Directorships held in other listed
entities
Nil
None
Roger Pooley (Bsc)
Non-Executive Director (appointed 30 July 2013)
Mr Pooley has over forty years’ experience in the mining industry. He
has worked in Australia, Ghana, UK, Iran and Indonesia. For the first
fifteen years of his career, Mr Pooley worked in operations, in both line
management and staff positions. Following this, he moved into project
management for twelve years. For the past eighteen years as a
consultant, he has been involved mainly in studies, valuations, reserves
estimates, and appraisals. The latter part of his experience has been
mainly in Indonesia, although in that time he has also completed
assignments in Australia, the Philippines, Cameroon, Brazil, Kyrgyzstan
and Vietnam. Mr Pooley has worked on open pit, underground, and
alluvial properties in gold, coal, base metals and non-metallics. This wide
experience, together with his expertise in economics, helps him to
competently assess a variety of solutions to mining, treatment, logistical
and environmental problems.
Previous to joining the Board of Krakatoa, Mr Pooley worked at SRK
Consulting (Australasia) Pty Ltd as a Senior Consultant based in the
Perth and Jakarta offices from 2007 to June of 2013. Previous to
working at SRK, Mr Pooley worked in Jakarta from 1994 to 2007 at PT
Simapertama Minindo as an Independent Consultant.
Mr Pooley holds a BSc (Mining Engineering) - Royal School of Mines in
London, is a member of The Australasian Institute of Mining and
Metallurgy, a Chartered Professional Engineer, and a member of MICA.
He holds a WA Quarry Manager’s Certificate of Competency. Mr Pooley
is bilingual, speaking English and Bahasa Indonesia.
Interest in Shares
Directorships held in other listed
entities
Nil
None
– 7 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ REPORT (CONT.)
INFORMATION ON DIRECTORS (CONT)
Stephen Brockhurst (BCom)
Non-Executive Director (resigned 15 November 2013)
Mr Brockhurst has 12 years’ experience in the finance and corporate
advisory industry and has been responsible for the preparation of the
due diligence process and prospectuses on a number of initial public
offerings and significant
transactions. Mr Brockhurst’s experience
includes corporate and capital structuring, corporate advisory and
company secretarial services, capital raising, ASX and ASIC compliance
requirements.
Mr Brockhurst is currently a director of Red Emperor Resources NL,
Jacka Resources Limited and Plymouth Minerals Limited and company
secretary of Plymouth Minerals Limited, Raptor Resources Limited and
Terrace Resources Limited.
Interest in Shares (at resignation)
250,001 Fully paid ordinary shares
125,000 options exercisable at $0.20 on or before 30 June 2015
Directorships held in other listed
entities (at resignation)
Red Emperor Resources NL
Jacka Resources Limited
Plymouth Minerals Limited
Kent Hunter (BCom, CA)
Non-Executive Director (resigned 5 December 2013)
Kent Hunter is a chartered accountant with over 16 years corporate and
company secretarial experience. He has been involved in the listing of
over 30 companies on ASX in the past 9 years. He has experience in
capital raisings, ASX compliance and regulatory requirements and is
currently a director of Cazaly Resources Limited, Carbon Conscious Ltd
and Stratum Metals Ltd and is company secretary of two other ASX
listed entities.
Commencing with Hall Chadwick Chartered Accountants in 1990, Mr
Hunter completed his professional year and became chartered in 1993.
Mr Hunter joined Ord Partners Chartered Accountants in 1995 and
became corporate and audit manager for a range of listed and unlisted
entities. Mr Hunter founded Mining Corporate in 2000 and established a
business of identifying projects requiring a route to commercialization
including industrial, technology, mining and exploration companies.
Interest in Shares (at resignation)
1,183,334 Fully paid ordinary shares
591,667 options exercisable at $0.20 on or before 30 June 2015
Directorships held in other listed
entities (at resignation)
Cazaly Resources Limited
Carbon Conscious Limited
COMPANY SECRETARY
David Palumbo (BCom, CA)
David Palumbo is a chartered accountant with over six years’ experience in the auditing and financial reporting of
ASX listed and unlisted companies. Mr Palumbo provides corporate advisory and financial management advice
to clients of Mining Corporate and specialises in corporate compliance, statutory reporting and financial
accounting services. Mr Palumbo is currently company secretary for ASX listed companies Western Mining
Network Limited and Strike Resources Limited.
– 8 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ REPORT (CONT.)
REMUNERATION REPORT (AUDITED)
This report details the nature and amount of remuneration for each director of Krakatoa Resources Limited and for
the executives receiving the highest remuneration.
1. Employment Agreements
Mr Aryo Bimo currently works for the Group in an executive capacity as Executive Director.
Mr Bimo’s contract is for a term of 2 years with the option to extend for a further 1 year. Under the terms of the
agreement, Mr Bimo’s annual salary is $90,000 plus superannuation.
The Group may terminate Mr Bimo’s contract by giving Mr Bimo a minimum of 3 months written notice or by paying
Mr Bimo 3 months’ salary in lieu of notice. Mr Bimo may terminate the contract by giving 3 months written notice to
the Group.
Appointments of non-executive directors Brian Varndell and Roger Pooley are formalised in the form of service
agreements between themselves and the Group. Their engagements have no fixed term but cease on their
resignation or removal as a director in accordance with the Corporations Act 2001. They are each entitled to
receive directors’ fees of $30,000 per annum (exclusive of superannuation).
2. Remuneration policy
The Group’s remuneration policy has been designed to align director and executive objectives with shareholder
and business objectives by providing a fixed remuneration component and offering specific long-term incentives
based on key performance areas affecting the Group’s financial results. The board believes the remuneration
policy to be appropriate and effective in its ability to attract and retain the best executives and directors to run and
manage the Group, as well as create goal congruence between directors, executives and shareholders.
The board’s policy for determining the nature and amount of remuneration for board members and senior
executives of the Group is as follows:
•
The remuneration policy, setting the terms and conditions for the executive directors and other senior
executives, was developed by the board.
• All executives receive a base salary (which is based on factors such as length of service and experience),
•
superannuation and are entitled to the issue of share options.
Incentive paid in the form of share options are intended to align the interests of directors and Group with
those of the shareholders.
The performance of executives is measured against criteria agreed annually with each executive and is based
predominantly on the forecast growth of the Group’s shareholders’ value. The board may, however, exercise its
discretion in relation to approving incentives, bonuses and options, and can recommend changes to the
committee’s recommendations. Any changes must be justified by reference to measurable performance criteria.
The policy is designed to attract the highest calibre of executives and reward them for performance that results in
long-term growth in shareholder wealth.
Executives are also entitled to participate in the employee share and option arrangements.
The executive director receives a superannuation guarantee contribution required by the government, which was
9.25% for the year ended 30 June 2013, increasing to 9.50% effective 1 July 2014. No other retirement benefits
are paid.
All remuneration paid to directors and executives is valued at the cost to the Group and expensed, or capitalised to
exploration expenditure if appropriate. Options, if given to directors and executives in lieu of remuneration, are
valued using the Black-Scholes methodology.
The board policy is to remunerate non-executive directors at market rates for time, commitment and
responsibilities. The remuneration committee determines payments to the non-executive directors and reviews
their remuneration annually, based on market practice, duties and accountability. Independent external advice is
sought when required. The maximum aggregate amount of fees that can be paid to non-executive directors is
subject to approval by shareholders at the Annual General Meeting. Fees for non-executive directors are not
linked to the performance of the Group. However, to align directors’ interests with shareholder interests, the
directors are encouraged to hold shares in the Group and are able to participate in the employee share option
plan.
– 9 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ REPORT (CONT.)
REMUNERATION REPORT (AUDITED) (CONT)
3. Performance-based remuneration
There is currently no performance-based remuneration policy in place.
4. Details of remuneration for the year ended 30 June 2014
The remuneration for each key management personnel of the Group during the financial year ended 30 June
2014 was as follows:
2014
Key Management
Person
Directors
Kevin Kwok
Aryo Bimo
Brian Varndell
Roger Pooley
Stephen Brockhurst
Kent Hunter
Short-
term
Benefits
Cash, salary
&
commissions
$
Post-
employment
Benefits
Super-
annuation
Other
Long-term
Benefits
Other
Share based
Payment
Total
Perfor-
mance
Related
Value of
Options Re-
muneration
Equity Options
$
$
$
$
$
%
%
90,000
52,500
17,097
27,500
15,000
32,500
-
-
1,581
2,543
1,387
-
-
-
- 220,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
90,000
272,500
18,678
30,043
16,387
32,500
234,597
5,511
- 220,000
-
460,108
-
-
-
-
-
-
-
-
-
-
-
-
-
-
The remuneration for each key management personnel of the Group during the financial year ended 30 June
2013 was as follows:
2013
Key Management
Person
Directors
Kevin Kwok
Stephen Brockhurst
Kent Hunter
Short-
term
Benefits
Cash, salary
&
commissions
$
Post-
employment
Benefits
Super-
annuation
Other
Long-term
Benefits
Other
Share based
Payment
Total
Perfor-
mance
Related
Value of
Options Re-
muneration
Equity Options
$
$
$
$
$
%
%
45,000
17,320
17,500
-
1,559
-
79,820
1,559
-
-
-
-
-
-
-
-
-
-
-
45,000
18,879
17,500
-
81,379
-
-
-
-
-
-
-
-
– 10 –
Krakatoa Resources Limited
& Controlled Entities
5. Equity holdings of key management personnel
DIRECTORS’ REPORT (CONT.)
Shareholdings
Number of shares held by key management personnel during the financial year ended 30 June 2014 was as
follows:
2014
Balance
1.7.2013
No.
Received as
Compensation
No.
Options
Exercised
No.
Net Change
Other
No.
Balance
30.6.2014
No.
Directors
Kevin Kwok
Aryo Bimo
Brian Varndell
Roger Pooley
Stephen Brockhurst
Kent Hunter
Total
1,000,000
-
-
-
250,001
1,183,334
2,433,335
-
1,000,000
-
-
-
-
1,000,000
-
-
-
-
-
-
-
-
-
-
-
(250,001)*
(1,183,334)*
(1,433,335)
1,000,000
1,000,000
-
-
-
-
2,000,000
Option holdings
Number of options held by key management personnel during the financial year ended 30 June 2014 was as
follows:
2014
Balance
1.7.2013
No.
Received as
Compensation
No.
Options
Exercised
No.
Net Change
Other
No.
Balance
30.6.2014
No.
Directors
Kevin Kwok
Aryo Bimo
Brian Varndell
Roger Pooley
Stephen Brockhurst
Kent Hunter
Total
-
-
-
-
125,000
591,667
716,667
* Balance held at date of resignation
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(125,000)*
(591,667)*
(716,667)
-
-
-
-
-
-
-
6. Other transactions with key management personnel
The Group incurred the following transactions with related parties:
- During the year ended 30 June 2014, Mining Corporate Pty Ltd, an entity which Kent Hunter and
Stephen Brockhurst are directors and have a beneficial interest, was paid $56,090 (2013: $163,650) in
Group secretarial and IPO compliance fees up until the resignation of Kent Hunter from the board of
directors on 5 December 2013. No amount (2013: $nil) was outstanding at year end.
- During the year ended 30 June 2013, Stellar Securities Pty Ltd, an entity which Kent Hunter is a director
and has a beneficial interest, was issued 933,333 ordinary fully paid shares and paid $102,667 under
the co-lead broker mandate. No amount was outstanding for the year ended 30 June 2013.
All transactions were made on normal commercial terms and condition and at market rates.
7. Equity instruments granted as compensation
Details of ordinary shares in the Company that were granted as compensation to each key management person
and details of options that were vested are as follows:
Director/Key
Management Personnel
Number of Shares
Granted
Grant Date
Fair Value per
Share at Grant Date
Aryo Bimo
1,000,000
7 March 2014
0.22
“End of Remuneration Report (Audited)”
– 11 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ REPORT (CONT.)
MEETINGS OF DIRECTORS
The number of Directors' meetings (including committees) held during the financial year and the number of
meetings attended by each Director are:
Director
Kevin Kwok
Stephen Brockhurst
Kent Hunter
Roger Pooley
Aryo Bimo
Brian Varndell
Directors’ Meetings
Number eligible to attend
1
1
1
-
-
-
Number attended
1
1
1
-
-
-
EVENTS AFTER THE REPORTING PERIOD
On 22 August 2014, the Company issued 1,000,000 fully paid ordinary shares and 1,000,000 Options exercisable
at $0.20 on or before 30 June 2015, raising $100,000.
No matters or circumstances have arisen since the end of the financial period which significantly affected or may
significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group
in future financial periods.
INDEMNITY AND INSURANCE OF AUDITOR
The company has not, during or since the end of the financial year, indemnified or agreed to indemnify the
auditor of the company or any related entity against a liability incurred by the auditor.
During the financial year, the company has not paid a premium in respect of a contract to insure the auditor of the
company or any related entity.
ENVIRONMENTAL ISSUES
The Group’s operations are subject to significant environmental regulation under the law of the Commonwealth
and State in relation to discharge of hazardous waste and materials arising from any mining activities and
development conducted by the Group on any of its tenements. To date the Group has not carried out any
exploration activities and there have been no known breaches of any environmental obligations.
The directors have considered the National Greenhouse and Energy Reporting Act 2007 (the NGER Act) which
introduces a single national reporting framework for the reporting and dissemination of information about the
greenhouse gas emissions, greenhouse gas projects, and energy use and production of corporations. At the
current stage of development, the directors have determined that the NGER Act will have no effect on the Group
for the current or subsequent financial period. The directors will reassess this position as and when the need
arises.
INDEMNIFYING AND INSURANCE OF OFFICERS
The Group has entered into deeds of indemnity with each director whereby, to the extent permitted by the
Corporations Act 2001, the Group agreed to indemnify each director against all loss and liability incurred as an
officer of the Group, including all liability in defending any relevant proceedings.
The Group has paid premiums to insure each of the directors against liabilities for costs and expenses incurred
by them in defending any legal proceedings arising out of their conduct while acting in the capacity of director of
the Group, other than conduct involving a wilful breach of duty in relation to the Group. The disclosure of the
amount of the premium is prohibited by the insurance policy.
– 12 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ REPORT (CONT.)
FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES
Further information, other than as disclosed this report, about likely developments in the operations of the Group
and the expected results of those operations in future periods has not been included in this report as disclosure
of this information would be likely to result in unreasonable prejudice to the Group.
PROCEEDINGS ON BEHALF OF THE GROUP
No person has applied for leave of Court to bring proceedings on behalf of the Group or intervene in any
proceedings to which the Group is a party for the purpose of taking responsibility on behalf of the Group for all or
any part of those proceedings.
The Group was not a party to any such proceedings during the year.
NON-AUDIT SERVICES
There following fees were paid or payable to the auditor for non-audit services provided during the year ended 30
June 2014:
—
taxation services
$
500
The directors are satisfied that the provision of non-audit services during the year by the auditor is compatible
with the general standard of independence for auditors imposed by the Corporations Act 2001.
The directors are of the opinion that the non-audit services provided by the auditor do not compromise the
auditor’s independence requirements of the Corporations Act 2001 for the following reasons:
•
all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and
objectivity of the auditor; and
none of the services provided undermine the general principles relating to auditor independence as set out in
APES 110 Code of Ethics for Professional Accountants issued by the Accounting Professional and Ethical
Standards Board.
•
AUDITOR’S INDEPENDENCE DECLARATION
The lead auditor’s independence declaration for the year ended 30 June 2014 has been received and can be
found on the next page of the directors’ report.
Signed in accordance with a resolution of the Board of Directors.
Aryo Bimo
Executive Director
Dated: 19 September 2014
– 13 –
RSM Bird Cameron Partners
8 St George’s Terrace Perth WA 6000
GPO Box R1253 Perth WA 6844
T +61 8 9261 9100 F +61 8 9261 9101
www.rsmi.com.au
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of Krakatoa Resources Limited for the year ended 30 June
2014, I declare that, to the best of my knowledge and belief, there have been no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii)
any applicable code of professional conduct in relation to the audit.
RSM BIRD CAMERON PARTNERS
Perth, WA
Dated: 19 September 2014
TUTU PHONG
Partner
Liability limited by a
scheme approved
under Professional
Standards Legislation
Major Offices in:
Perth, Sydney, Melbourne,
Adelaide and Canberra
ABN 36 965 185 036
RSM Bird Cameron Partners is a member of the RSM network. Each member
of the RSM network is an independent accounting and advisory firm which
practises in its own right. The RSM network is not itself a separate legal entity
in any jurisdiction.
Krakatoa Resources Limited
& Controlled Entities
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2014
Revenue
Administration expenses
Compliance and regulatory expense
Employee benefits expense
Exploration expenditure and project evaluation costs
Impairment of exploration expenditure
Travel and accommodation
Loss before income tax expense
Income tax expense
Loss for the year / period
Other comprehensive income
Item that may be reclassified subsequently to operating result
Foreign currency translation
Total comprehensive (loss) attributable to members
of the parent entity
Net loss attributable to:
Members of the parent entity
Non-controlling interest
Total comprehensive loss attributable to:
Members of the parent entity
Non-controlling interest
Note
2
30 June 2014
$
30 June 2013
$
70,539
38,897
(259,482)
(178,483)
(522,649)
(718,129)
(106,187)
(169,723)
3
(1,884,114)
-
(187,081)
(116,621)
(130,308)
(100,675)
-
(123,476)
(619,264)
-
(1,884,114)
(619,264)
1,992
446
(1,882,122)
(618,818)
(1,884,114)
-
(1,884,114)
(1,882,122)
-
(1,882,122)
(619,264)
-
(619,264)
(618,818)
-
(618,818)
Basic and diluted loss per share (cents per share)
4
(6.12)
(2.89)
The accompanying notes form part of these financial statements.
– 15 –
Krakatoa Resources Limited
& Controlled Entities
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2014
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Other financial assets
Other assets
TOTAL CURRENT ASSETS
NON CURRENT ASSETS
Other assets
Exploration and evaluation expenditure
TOTAL NON CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
TOTAL CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Non-controlling interest
Accumulated losses
TOTAL EQUITY
Note
2014
$
2013
$
6
7
8
9
9
10
11
12
13
14
61,796
209,436
865
38,182
1,773,444
16,629
37,490
122,684
310,279
1,950,247
-
1,767,767
40,190
543,687
1,767,767
583,877
2,078,046
2,534,124
195,211
195,211
195,211
89,167
89,167
89,167
1,882,835
2,444,957
4,234,730
147,438
87,500
(2,586,833)
2,914,730
145,446
87,500
(702,719)
1,882,835
2,444,957
The accompanying notes form part of these financial statements.
– 16 –
Krakatoa Resources Limited
& Controlled Entities
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2014
Note
Issued
Capital
$
Accumulated
Losses
$
Option
Premium
Reserve
$
Foreign
Currency
Translation
Reserve
$
Non-
controlling
interest
$
Total
$
186,798
(619,264)
446
(618,818)
3,200,000
(555,523)
145,000
Balance at 1 July 2012
270,253
(83,455)
Loss for the year
Other comprehensive income
Total comprehensive loss
Transactions with owner directly
recorded in equity
Shares issued during the year
Less: transaction costs arising from
issue of shares
Options issued during the year
Recognition of minority interest of
PT. Dana Ramakala
Balance at 30 June 2013
-
-
-
(619,264)
-
(619,264)
12
3,200,000
-
12
13
14
(555,523)
-
-
2,914,730
-
-
-
-
-
-
-
446
446
-
-
-
-
-
-
-
-
-
-
-
-
-
- 145,000
-
-
(702,719) 145,000
-
446
87,500
87,500
87,500
2,444,957
Balance at 1 July 2013
2,914,730
(702,719) 145,000
446
87,500
2,444,957
Loss for the year
Other comprehensive loss
Total comprehensive loss
Transactions with owner directly
recorded in equity
Shares issued during the year
Balance at 30 June 2014
-
-
-
(1,884,114)
-
(1,884,114)
-
-
-
-
1,992
1,992
-
-
-
(1,884,114)
1,992
(1,882,122)
12
1,320,000
4,234,730
-
-
(2,586,833) 145,000
-
2,438
-
87,500
1,320,000
1,882,835
The accompanying notes form part of these financial statements.
– 17 –
Krakatoa Resources Limited
& Controlled Entities
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2014
CASH FLOWS FROM OPERATING ACTIVITIES
Interest received
Payments to suppliers and employees
Payment for exploration and evaluation expenditure
Note
2014
$
2013
$
29,811
(804,541)
(788,301)
22,062
(593,058)
(206,862)
Net cash used in operating activities
16
(1,563,031)
(777,858)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for exploration assets
Payments for financial assets
Proceeds from sale of financial assets
Loans to other entities
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Proceeds from issue of options
Share application money (refunded)/received
Payment of transaction costs associated with capital raising
-
-
51,015
(193,865)
(150,000)
(114,060)
32,850
-
(142,850)
(231,210)
-
-
(5,767)
-
3,000,000
140,768
10,000
(555,523)
Net cash (used in)/provided by financing activities
(5,767)
2,595,245
Net (decrease)/increase in cash held
Cash at beginning of financial year / period
(1,711,648)
1,773,444
1,586,177
187,267
Cash at end of financial year / period
6
61,796
1,773,444
The accompanying notes form part of these financial statements.
– 18 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 1:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
These financial statements and notes represent those of Krakatoa Resources Limited (the “Company”) and its
controlled entities (the “Group”). Krakatoa Resources Limited is a listed public Company, incorporated and
domiciled in Australia.
The financial statements were authorised for issue on 18 September 2014 by the directors of the Group.
Basis of Preparation
The 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 a for profit entity for
financial reporting purposes under Australian Accounting Standards.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a
financial report containing relevant and reliable information about transactions, events and conditions to which
they apply. Compliance with Australian Accounting Standards ensures that the financial statements and notes
also comply with International Financial Reporting Standards as issued by the IASB. Material accounting policies
adopted in the preparation of this financial report are presented below. They have been consistently applied
unless otherwise stated.
The financial report has been prepared on an accruals basis and is based on historical costs modified by the
revaluation of selected financial assets for which the fair value basis of accounting has been applied. All amounts
are presented in Australian dollars unless otherwise stated.
Going Concern
The financial report has been prepared on a going concern basis, which contemplates the continuity of normal
business activity and the realisation of assets and the settlement of liabilities in the ordinary course of business.
The Company and Group incurred losses of $1,794,175 and $1,884,114 respectively and the Group had net cash
outflows from operating activities of $1,563,031 for the year ended 30 June 2014.
The ability of the Company and Group to continue as going concerns is principally dependent upon the ability of
the Company to secure funds by raising capital from equity markets and managing cashflow in line with available
funds. These conditions indicate a material uncertainty, which may cast significant doubt about the ability of the
Company and Group to continue as going concerns.
The directors have prepared a cash flow forecast, which indicates that the Company and Group will have
sufficient cash flows to meet all commitments and working capital requirements for the 12 month period from the
date of signing this financial report. Subsequent to year end the Company raised $100,000 from this issue of
1,000,000 shares and 500,000 options exercisable at $0.20 on or before 30 June 2015.
Based on the cash flow forecasts, and other factors referred to above, the directors are satisfied that the going
concern basis of preparation is appropriate. In particular, given the Company’s history of raising capital to date,
the directors are confident of the Company’s ability to raise additional funds as and when they are required.
Should the Company and Group be unable to continue as going concerns they may be required to realise their
assets and extinguish their liabilities other than in the normal course of business and at amounts different to
those stated in the financial statements. The financial statements do not include any adjustments relating to the
recoverability and classification of asset carrying amounts or to the amount and classification of liabilities that
might result should the Company and Group be unable to continue as going concerns and meet their debts as
and when they fall due.
Accounting Policies
a) Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities (including
special purpose entities) controlled by the Company (its subsidiaries). Control is achieved where the Company
has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
Income and expense of subsidiaries acquired or disposed of during the year are included in the consolidated
statement of comprehensive income from the effective date of acquisition and up to the effective date of disposal,
as appropriate. Total comprehensive income of subsidiaries is attributed to the owners of the Company and to
the non-controlling interests even if this results in the non-controlling interests having a deficit balance.
– 19 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 1:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
a) Basis of consolidation (Cont.)
Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting
policies into line with those used by other members of the Group. All intra-group transactions, balances, income
and expenses are eliminated in full on consolidation.
Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing control are
accounted for as equity transactions. The carrying amounts of the Group’s interests and the non-controlling
interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between
the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or
received is recognised directly in equity and attributed to owners of the Company.
When the Group loses control of a subsidiary, a gain or loss is recognised in profit or loss and is calculated as the
difference between (i) the aggregate of the fair value of the consideration received and the fair value of any
retained interest and (ii) the previous carrying amount of the assets (including goodwill), and liabilities of the
subsidiary and any non-controlling interests. When assets of the subsidiary are carried at revalued amounts or
fair values and the related cumulative gain or loss has been recognised in other comprehensive income and
accumulated in equity, the amounts previously recognised in other comprehensive income and accumulated in
equity are accounted for as if the Group had directly disposed of the relevant assets (i.e. reclassified to profit or
loss or transferred directly to retained earnings as specified by applicable Standards). The fair value of any
investment retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial
recognition for subsequent accounting under AASB 139 ‘Financial Instruments: Recognition and Measurement’
or, when applicable, the cost on initial recognition of an investment in an associate or jointly controlled entity.
Income Tax
b)
The income tax expense (revenue) for the period comprises current income tax expense (income) and deferred
tax expense (income).
Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using
applicable income tax rates enacted, or substantially enacted, as at reporting date. Current tax liabilities (assets)
are therefore measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during
the period as well unused tax losses. Current and deferred income tax expense (income) is charged or credited
directly to equity instead of the profit or loss when the tax relates to items that are credited or charged directly to
equity.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result
where amounts have been fully expensed but future tax deductions are available. 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 assets and liabilities are calculated at the tax rates that are expected to apply to the period when the
asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at reporting date.
Their measurement also reflects the manner in which management expects to recover or settle the carrying
amount of the related asset or liability. Deferred tax assets relating to temporary differences and unused tax
losses are recognised only to the extent that it is probable that future taxable profit will be available against which
the benefits of the deferred tax asset can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint
ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary
difference can be controlled and it is not probable that the reversal will occur in the foreseeable future.
Current tax assets and liabilities are offset where a 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.
– 20 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 1:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
c) Exploration and Evaluation Expenditure
Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest.
These costs are only carried forward to the extent that they are expected to be recouped through the successful
development of the area or where activities in the area have not yet reached a stage that permits reasonable
assessment of the existence of economically recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit in the period 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.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest.
Costs of site restoration are provided over the life of the facility from when exploration commences and are
included in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant,
equipment and building structures, waste removal, and rehabilitation of the site in accordance with clauses of the
mining permits. Such costs 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 the restoration will be
completed within one period of abandoning the site.
d) Financial Instruments
Initial recognition and 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 transaction costs where the instrument is not
classified as ‘at fair value through profit or loss’, in which case transaction costs are expensed to profit or loss
immediately.
Classification and subsequent measurement
Finance instruments are subsequently measured at either of fair value, amortised cost using the effective interest
rate method, or cost.
Amortised cost is the amount at which the financial asset or financial liability is measured at initial recognition less
principal repayments and reduction for impairment, and adjusted for any cumulative amortisation of the difference
between the amount initially recognised and the maturity amount calculated using the effective interest method.
Fair value represents the amount for which an asset could be exchanged or a liability settled, between
knowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair
value. In other circumstances, valuation techniques are adopted.
The effective interest method is used to allocate interest income or interest expense over the relevant period and
is equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees,
transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably
predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or
financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying value
with a consequential recognition of an income or expense in profit or loss.
– 21 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 1:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
d) Financial Instruments (Cont.)
The Group does not designate any interests in subsidiaries, associates or joint venture entities as being subject
to the requirements of accounting standards specifically applicable to financial instruments.
(i)
Financial assets at fair value through profit and loss
Financial assets are classified ‘at fair value through profit or loss’ when they are held for trading for the purpose
of short term profit taking, where they are derivatives not held for hedging purposes, or designated as such to
avoid an accounting mismatch or to enable performance valuation where a Group of financial assets is managed
by key management personnel on a fair value basis in accordance with a documented risk management or
investment strategy. Such assets are subsequently measured at fair value with changes in the carrying value
being included in profit or loss.
(ii)
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market and are subsequently measured at amortised cost.
Loans and receivables are included in current assets, except for those which are not expected to mature within
12 months after the end of the reporting period. All other loans and receivables are classified as non-current
assets.
(iii)
Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or
determinable payments, and it is the Group’s intention to hold these investments to maturity. They are
subsequently measured at amortised cost.
Held-to-maturity investments are included in non-current assets, except for those which are expected to mature
within 12 months after the end of the reporting period. (All other investments are classified as current assets).
If during the period the Group sold or reclassified more than an insignificant amount of the held-to-maturity
investments before maturity, the entire held-to-maturity investments category would be tainted and reclassified as
available-for-sale.
(iv)
Available for sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are either not suitable to be classified
into other categories of financial assets due to their nature, or they are designated as such by management. They
comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed or
determinable payments.
Available-for-sale financial assets are included in non-current assets, except for those which are expected to
mature within 12 months after the end of the reporting period. All other financial assets are classified as current
assets.
(v)
Financial Liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost.
Fair Value
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied
to determine the fair value of all unlisted securities, including recent arm’s length transactions, reference to
similar instruments and option pricing models.
– 22 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 1:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
d) Financial Instruments (Cont.)
Impairment
At each reporting date the Group assesses whether there is objective evidence that a financial instrument has
been impaired. In the case of available-for-sale financial instruments a significant or prolonged decline in the
value of the instrument is considered to determine whether an impairment has arisen. Impairment losses are
recognised in the statement of comprehensive income.
De-recognition
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 is no longer has any significant continuing involvement in the risks
and benefits associated with the asset. Financial liabilities are derecognised where the related obligations are
either discharged, cancelled or expire. The difference between the carrying value of the financial liability
extinguished or transferred to another party and the fair value of consideration paid, including the transfer of non-
cash assets or liabilities assumed, is recognised in profit or loss.
e) Foreign currencies
The individual financial statements of each group entity are presented in the currency of the primary economic
environment in which the entity operates (its functional currency). For the purpose of the consolidated financial
statements, the results and financial position of each group entity are expressed in Australian dollars (‘$’), which
is the functional currency of the Group and the presentation currency for the consolidated financial statements.
In preparing the financial statements of each individual group entity, transactions in currencies other than the
entity’s functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of
the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are
retranslated at the rates prevailing at that date. Nonmonetary items carried at fair value that are denominated in
foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-
monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences on monetary items are recognised in profit or loss in the period in which they arise except
for:
•
•
•
exchange differences on foreign currency borrowings relating to assets under construction for future
productive use, which are included in the cost of those assets when they are regarded as an adjustment
to interest costs on those foreign currency borrowings;
exchange differences on transactions entered into in order to hedge certain foreign currency risks; and
exchange differences on monetary items receivable from or payable to a foreign operation for which
settlement is neither planned nor likely to occur (therefore forming part of the net investment in the
foreign operation), which are recognised initially in other comprehensive income and reclassified from
equity to profit or loss on repayment of the monetary items.
For the purpose of presenting consolidated financial statements, the assets and liabilities of the Group’s foreign
operations are translated into Australian dollars using exchange rates prevailing at the end of the reporting
period. Income and expense items are translated at the average exchange rates for the period, unless exchange
rates fluctuated significantly during that period, in which case the exchange rates at the dates of the transactions
are used. Exchange differences arising, if any, are recognised in other comprehensive income and accumulated
in equity (attributed to non-controlling interests as appropriate).
On the disposal of a foreign operation (i.e. a disposal of the Group’s entire interest in a foreign operation, or a
disposal involving loss of control over a subsidiary that includes a foreign operation, loss of joint control over a
jointly controlled entity that includes a foreign operation, or loss of significant influence over an associate that
includes a foreign operation), all of the accumulated exchange differences in respect of that operation attributable
to the Group are reclassified to profit or loss.
In addition, in relation to a partial disposal of a subsidiary that does not result in the Group losing control over the
subsidiary, the proportionate share of accumulated exchange differences are reattributed to non-controlling
interests and are not recognised in profit or loss. For all other partial disposals (i.e. partial disposals of associates
or jointly controlled entities that do not result in the Group losing significant influence or joint control), the
proportionate share of the accumulated exchange differences is reclassified to profit or loss.
– 23 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 1:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
Impairment of Assets
f)
At the end of each reporting date, the Group assesses whether there is any indication that an asset may be
impaired. The assessment will include the consideration of external and internal sources of information including
dividends received from subsidiaries, associates or jointly controlled entities deemed to be out of pre-acquisition
profits. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value
less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying
value over its recoverable amount is expensed.
Impairment testing is performed annually for intangible assets with indefinite lives. 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.
g) Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks and other short-term highly
liquid investments with original maturities of 3 months or less.
h) Revenue
Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the
financial assets.
All revenue is stated net of the amount of goods and services tax (GST).
i) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST
incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part
of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the
statement of financial position are shown inclusive of GST.
Cash flows are presented in the statement of cash flows on a gross basis, except for the GST component of
investing and financing activities, which are disclosed as operating cash flows.
j) Trade and other receivables
All trade receivables are recognised when they are due for settlement in the short term. Collectability of trade
and other receivables is reviewed on an ongoing basis. Debts which are known to be uncollectable are written
off. A provision for doubtful debts is raised when some doubt as to collection exists.
k) Trade and other payables
These amounts represent liabilities for goods and services provided to the Group before the end of the financial
period and which are unpaid. The amounts are unsecured and usually paid within 30 days of recognition.
Issued capital
l)
Ordinary shares are classified as equity. Costs directly attributable to the issue of shares or options are shown in
equity as a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new
shares or options, or for the acquisition of a business, are included in the cost of the acquisition as part of the
purchase consideration.
m) Earnings per share
Basic earnings per share
Basic earnings per share is determined by dividing the net profit after income tax attributable to members of the
company, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of
ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued
during the year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into
account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary
shares and the weighted average number of shares assumed to have been issued for no consideration in relation
to dilutive potential ordinary shares.
– 24 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 1:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
n) Comparative Figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
o) 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.
Taxation
Balances disclosed in the financial statements and the notes thereto, related to taxation, are based on the best
estimates of directors. These estimates take into account both the financial performance and position of the
Group as they pertain to current income taxation legislation, and the directors understanding thereof. No
adjustment has been made for pending or future taxation legislation. The current income tax position represents
that directors’ best estimate, pending an assessment by the Australian Taxation Office.
Share-based payment transactions
The consolidated entity 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 either
the Binomial or 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 profit or loss and equity.
Exploration and Evaluation Expenditure
Exploration and evaluation costs are carried forward where right of tenure of the area of interest is current.
These costs are carried forward in respect of an area that has not at balance date reached a stage that permits
reasonable assessment of the existence of economically recoverable reserves, refer to the accounting policy
stated in note 1(c).
p) Changes in accounting policies and disclosure
In the year ended 30 June 2014, the Group has reviewed all of the new and revised Standards and Interpretations
issued by the AASB that are relevant to its operations and effective for the current annual reporting period.
It has been determined by the Group that there is no impact, material or otherwise, of the new and revised
Standards and Interpretations on its business and, therefore, no change is necessary to Group accounting
policies.
q) New Accounting Standards for Application in Future Periods
Accounting Standards and Interpretations issued by the AASB that are not yet mandatorily applicable to the
Company, together with an assessment of the potential impact of such pronouncements on the Company when
adopted in future periods, are discussed below:
–
AASB 9: Financial Instruments and associated Amending Standards (applicable for annual reporting
periods commencing on or after 1 January 2017).
The Standard will be applicable retrospectively (subject to the comment on hedge accounting below) and
includes revised requirements for the classification and measurement of financial instruments, revised
recognition and derecognition requirements for financial instruments and simplified requirements for
hedge accounting.
The key changes made to the Standard that may affect the Group on initial application include certain
simplifications to the classification of financial assets, simplifications to the accounting of embedded
derivatives, and the irrevocable election to recognise gains and losses on investments in equity
instruments that are not held for trading in other comprehensive income. AASB 9 also introduces a new
model for hedge accounting that will allow greater flexibility in the ability to hedge risk, particularly with
respect to hedges of non-financial items. Should the Group elect to change its hedge policies in line with
the new hedge accounting requirements of AASB 9, the application of such accounting would be largely
prospective.
– 25 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 1:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
q)
New Accounting Standards for Application in Future Periods (Cont.)
–
–
–
–
Although the directors anticipate that the adoption of AASB 9 may have an impact on the Group’s
financial instruments, it is impracticable at this stage to provide a reasonable estimate of the impact.
AASB 2012–3: Amendments to Australian Accounting Standards – Offsetting Financial Assets and
Financial Liabilities (applicable for annual reporting periods commencing on or after 1 January 2014).
This Standard provides clarifying guidance relating to the offsetting of financial instruments, which is not
expected to impact the Group’s financial statements.
Interpretation 21: Levies (applicable for annual reporting periods commencing on or after 1 January
2014).
Interpretation 21 clarifies the circumstances under which a liability to pay a levy imposed by a
government should be recognised, and whether that liability should be recognised in full at a specific
date or progressively over a period of time. This Interpretation is not expected to significantly impact the
Group’s financial statements.
AASB 2013–3: Amendments to AASB 136 – Recoverable Amount Disclosures for Non-Financial Assets
(applicable for annual reporting periods commencing on or after 1 January 2014).
This Standard amends the disclosure requirements in AASB 136: Impairment of Assets pertaining to the
use of fair value in impairment assessment and is not expected to significantly impact the Group’s
financial statements.
AASB 2013–4: Amendments to Australian Accounting Standards – Novation of Derivatives and
Continuation of Hedge Accounting (applicable for annual reporting periods commencing on or after 1
January 2014).
AASB 2013–4 makes amendments to AASB 139: Financial Instruments: Recognition and Measurement
to permit the continuation of hedge accounting in circumstances where a derivative, which has been
designated as a hedging instrument, is novated from one counterparty to a central counterparty as a
consequence of laws or regulations. This Standard is not expected to significantly impact the Group’s
financial statements.
–
AASB 2013–5: Amendments to Australian Accounting Standards – Investment Entities (applicable for
annual reporting periods commencing on or after 1 January 2014).
AASB 2013–5 amends AASB 10: Consolidated Financial Statements to define an “investment entity” and
requires, with limited exceptions, that the subsidiaries of such entities be accounted for at fair value
through profit or loss in accordance with AASB 9 and not be consolidated. Additional disclosures are also
required. As neither the parent nor its subsidiaries meet the definition of an investment entity, this
Standard is not expected to significantly impact the Group’s financial statements.
– 26 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 2:
REVENUE
Interest received
Profit on sale of financial assets
NOTE 3:
INCOME TAX EXPENSE
a.
from ordinary activities before
Reconciliation of income tax expense to prima
facie tax payable:
Loss
expense
Prima facie tax benefit on loss from ordinary activities
before income tax at 30%
income
tax
Increase in income tax due to:
- Non-deductible expenses
- Losses and temporary differences not recognised
Decrease in income tax due to:
- Deductible equity raising costs
Income tax attributable to the Group
b. Unused tax losses and temporary differences for
which no deferred tax asset has been recognised
at 30%:
2014
$
2013
$
34,524
36,015
70,539
28,047
10,850
38,897
(1,884,114)
(619,264)
(565,234)
(185,779)
-
565,234
-
185,779
-
-
-
-
Deferred tax assets have not been recognised in respect of
the following:
Deductible temporary differences
Tax revenue losses
-
776,049
776,049
-
210,815
210,815
Potential deferred tax assets attributable to tax losses and exploration expenditure carried forward have
not been brought to account at 30 June 2014 because the directors do not believe it is appropriate to
regard realisation of the deferred tax assets as probable at this point in time. These benefits will only be
obtained if:
•
the Group derives future assessable income of a nature and of an amount sufficient to enable the benefit
from the deductions for the loss and exploration expenditure to be realised;
no changes in tax legislation adversely affect the Group in realising the benefit from the
deductions for the loss and exploration expenditure.
•
NOTE 4:
EARNINGS PER SHARE
a.
Loss used to calculate basic EPS
(1,884,114)
(619,264)
b.
Weighted average number of ordinary shares outstanding
during the period used in calculating basic and diluted EPS
No
No
30,808,222
21,460,277
As the Group is in a loss position the options outstanding at 30 June 2014 have no dilutive effects on the
earnings per share calculation.
– 27 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 5:
KEY MANAGEMENT PERSONNEL COMPENSATION
Remuneration of Key Management Personnel
The totals of remuneration paid to the KMP of the Group during the year are as follows:
Short-term employee benefits
Post-employment benefits
Share based payments
Total remuneration
2014
$
2013
$
234,597
5,511
220,000
460,108
79,820
1,559
-
81,379
NOTE 6:
CASH AND CASH EQUIVALENTS
Cash at bank
61,796
1,773,444
NOTE 7:
TRADE AND OTHER RECEIVABLES
CURRENT
GST receivable
Other receivables
NOTE 8:
OTHER FINANCIAL ASSETS
Financial assets at fair value through profit or loss
Held-for-trading Australian listed shares
4,873
204,563
209,436
6,412
10,217
16,629
865
37,490
Shares held for trading are traded for the purpose of short-term profit taking. Changes in fair value are included in
the statement of comprehensive income.
NOTE 9:
OTHER ASSETS
CURRENT
Prepayments
NON-CURRENT
Prepayments
38,182
122,684
-
40,190
– 28 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 10: EXPLORATION AND EVALUATION EXPENDITURE
Exploration expenditure capitalised
- Exploration and evaluation phase
A reconciliation of
evaluation expenditure is set out below:
the carrying amount of exploration and
- Carrying amount at the beginning of the year
- Acquisition of exploration assets (note 15)
- Non-controlling interest
- Costs capitalised during the year
- Exploration written off
2014
$
2013
$
1,767,767
543,687
543,687
1,330,267
-
-
(106,187)
1,767,767
-
350,000
87,500
106,187
-
543,687
The value of the Group’s interest in exploration expenditure is dependent upon:
the continuance of the Group’s rights to tenure of the areas of interest;
the results of future exploration; and
the recoupment of costs through successful development and exploitation of the areas of interest, or
alternatively, by their sale.
•
•
•
NOTE 11:
TRADE AND OTHER PAYABLES
CURRENT
Sundry payables and accrued expenses
Trade creditors are expected to be paid on 30 day terms.
NOTE 12:
ISSUED CAPITAL
195,211
89,167
2014
No.
2014
$
2013
No.
2013
$
Fully paid ordinary shares with no par value
35,000,003
4,234,730
29,000,003
2,914,730
a)
Ordinary shares
At the beginning of reporting period
Shares issued during the year /period:
- 20 December 2012
- 20 December 2012
- 12 March 2014
Less capital raising costs
29,000,003
2,914,730
13,000,003
270,253
-
-
6,000,000
-
-
-
1,320,000
-
15,000,000
1,000,000
-
-
3,000,000
200,000
-
(555,523)
Net share capital
35,000,003
4,234,730
29,000,003
2,914,730
The Group does not have authorised capital nor par value in respect of its issued capital. Ordinary shares have
the right to receive dividends as declared and, in the event of a winding up of the Group, to participate in the
proceeds from sale of all surplus assets in proportion to the number of and amounts paid up on shares held.
Ordinary shares entitle their holder to one vote, either in person or proxy, at a meeting of the Group.
– 29 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
b)
Capital risk management
The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern, so that
it may continue to provide returns for shareholders and benefits for other stakeholders. The Group’s capital
includes ordinary share capital and financial liabilities, supported by financial assets.
Due to the nature of the Group’s activities, being mineral exploration, it does not have ready access to credit
facilities, with the primary source of funding being equity raisings. Accordingly, the objective of the Group’s capital
risk management is to balance the current working capital position against the requirements of the Group to meet
exploration programmes and corporate overheads. This is achieved by maintaining appropriate liquidity to meet
anticipated operating requirements, with a view to initiating appropriate capital raisings as required. The Group is
not subject to any externally imposed capital requirements.
Cash and cash equivalents
Trade and other receivables
Other financial assets
Trade and other payables
Working capital position
c)
Share Options on issue
2014
$
2013
$
61,796
209,436
865
(195,211)
1,773,444
16,629
37,490
(89,167)
76,886
1,738,396
At 30 June 2014, the Group has 14,500,002 (2013: 14,500,002) listed options exercisable at $0.20 on or before
30 June 2015. Options carry no rights to dividends and have no voting rights.
NOTE 13:
RESERVES
Foreign currency translation reserve
Option premium reserve
2,438
145,000
147,438
446
145,000
145,446
Exchange differences relating to the translation of the results and net assets of the Group’s foreign operations
from their functional currencies to the Group’s presentation currency (i.e. Australian dollars) are recognised
directly in other comprehensive income and accumulated in the foreign currency translation reserve.
NOTE 14:
NON-CONTROLLING INTEREST
Balance at the beginning of the year
Non-controlling interests arising on the acquisition
of PT. Dana Ramakala
Share of loss for the year
87,500
-
-
87,500
-
87,500
-
87,500
NOTE 15:
ACQUISTION OF EXPLORATION ASSETS
On 20 December 2012, the Group completed the acquisition of an 80% interest in the issued capital of PT. Dana
Ramakala through the payment of $150,000 and the issue of 1,000,000 ordinary fully paid shares. It is considered
that the acquisition of PT. Dana Ramakala is not a business combination, but rather an acquisition of mining
tenements.
Purchase consideration:
Cash
Ordinary shares
Non-controlling interest
Identifiable assets acquired:
Mineral exploration and evaluation expenditure
– 30 –
Fair Value
$
150,000
200,000
87,500
437,500
437,500
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 15:
ACQUISTION OF EXPLORATION ASSETS (CONT.)
On 12 March 2014, the Group completed the acquisition of a 99.8% interest in the issued capital of PT. Bina Citra
Sawita through the payment of US$150,000 and the issue of 5,000,000 ordinary fully paid shares. It is considered
that the acquisition of PT. Bina Citra Sawita is not a business combination, but rather an acquisition of mining
tenements.
Purchase consideration:
Cash
Ordinary shares
Identifiable assets/(liabilities) acquired:
Mineral exploration and evaluation expenditure
Trade and other payables
NOTE 16:
CASH FLOW INFORMATION
Reconciliation of Cash Flow from Operations with Loss
after Income Tax
Loss after income tax
Non cash-flows in loss:
Profit on sale of financial assets
Unrealised loss on financial assets
Share based payments
Foreign exchange loss
Changes in assets and liabilities:
Trade and other receivables
Other assets
Exploration and evaluation
Trade payables and accruals
Cash flow from operations
Non Cash Investing & Financing Activities:
Fair Value
$
172,216
1,100,000
1,272,216
1,330,267
(58,051)
1,272,216
2014
$
(1,884,114)
2013
$
(619,264)
(36,015)
21,625
220,000
1,992
(3,174)
124,692
(66,029)
57,992
(10,850)
54,570
-
-
(10,616)
(162,874)
(106,187)
77,363
(1,563,031)
(777,858)
During the financial year ended 30 June 2014, the Group issued 5,000,000 shares as part consideration of a
99.8% interest in the issued capital of PT. Bina Citra Sawita, as disclosed in Note 15.
During the financial year ended 30 June 2013, the Group issued 1,000,000 shares as part consideration of an
80% interest in the issued capital of PT. Dana Ramakala, as disclosed in Note 15.
Apart from the above, there were no non-cash investing or financing activities entered into by the Group during
the year.
NOTE 17:
RELATED PARTY TRANSACTIONS
The Group incurred the following transactions with related parties:
- During the year ended 30 June 2014, Mining Corporate Pty Ltd, an entity which Kent Hunter and Stephen
Brockhurst are directors and have a beneficial interest, was paid $56,090 (2013: $163,650) in Group
secretarial and IPO compliance fees up until the resignation of Kent Hunter from the board of directors on
5 December 2013. No amount (2013: $nil) was outstanding at year end.
- During the year ended 30 June 2013, Stellar Securities Pty Ltd, an entity which Kent Hunter is a director
and has a beneficial interest, was issued 933,333 ordinary fully paid shares and paid $102,667 under the
co-lead broker mandate. No amount was outstanding for the year ended 30 June 2013.
All transactions were made on normal commercial terms and condition and at market rates.
– 31 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
2014
$
2013
$
NOTE 18:
SHARE BASED PAYMENTS
The following share based payments were in existence during the year:
Ordinary shares
On 20 December 2012, 1,000,000 ordinary shares were issued to
vendors as part consideration for exploration assets acquired
-
200,000
On 13 March 2014, 1,000,000 ordinary shares were issued to Aryo
Bimo as an incentive for future performance
On 12 March 2014, 5,000,000 ordinary shares were issued to Sitasa
as part consideration for the exploration asset acquired
Fair value of ordinary shares issued during the period:
220,000
1,100,000
The fair value of ordinary shares issued were determined by reference to market price.
-
-
NOTE 19:
AUDITORS’ REMUNERATION
Remuneration of RSM Bird Cameron Partners as auditor for:
—
—
—
Auditing or reviewing the financial report
taxation services
Other services
NOTE 20:
CONTINGENT LIABILITIES AND CONTINGENT ASSETS
24,500
500
-
20,000
500
8,000
The Group will issue to the vendors of PT. Dana Ramakala up to an additional 2,000,000 Krakatoa shares, upon
the achievement of the following performance milestones:
a.
1,000,000 upon completion of a mapped geochemical survey, that in the sole discretion of Krakatoa,
warrants a 3 to 4 thousand metre diamond drilling program; and
b.
1,000,000 upon a JORC compliant resource of 1m oz Au or equivalent.
The Group has other no contingent assets or contingent liabilities.
NOTE 21:
EVENTS AFTER THE REPORTING PERIOD
On 22 August 2014, the Company issued 1,000,000 fully paid ordinary shares and 1,000,000 Options exercisable
at $0.20 on or before 30 June 2015, raising $100,000.
Other than the above, no matters or circumstances have arisen since the end of the financial period which
significantly affected or may significantly affect the operations of the Group, the results of those operations, or the
state of affairs of the Group in future financial periods.
NOTE 22:
CAPITAL AND LEASING COMMITMENTS
The Group has no commitments as at 30 June 2014.
NOTE 23:
CONTROLLED ENTITIES
Subsidiaries of Krakatoa Resources Limited:
PT. Bumi Pratama
PT. Dana Ramakala
PT. Bina Citra Sawita
Equity holding
Equity Holding
2014
%
100
80
99.8
2013
%
100
80
-
Country of Incorporation
Indonesia
Indonesia
Indonesia
– 32 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 24:
PARENT ENTITY DISCLOSURES
Financial position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Total liabilities
Equity
Issued capital
Accumulated losses
Reserves
Total equity
Financial performance
(Loss) for the year
Total comprehensive (loss) for the year
2014
$
2013
$
301,003
1,621,345
1,922,348
1,899,790
546,387
2,446,177
39,513
39,513
89,167
89,167
4,234,730
(2,496,895)
145,000
1,882,835
2,914,730
(702,720)
145,000
2,357,010
(1,794,175)
(1,794,175)
(619,264)
(619,264)
Guarantees:
Krakatoa Resources Limited has not entered into any guarantees in the current or previous financial year, in
relation to the debts of its subsidiaries.
Other Commitments and Contingencies:
Krakatoa Resources Limited has no commitment to acquire property, plant and equipment and has no
contingents liabilities other than disclosed in Note 20.
NOTE 25: OPERATING SEGMENTS
The Group has identified its operating segments based on the internal reports that are used by the Board (the
chief operating decision makers) in assessing performance and in determining the allocation of resources.
The operating segments are identified by the Board based on the phase of operation within the mining industry.
For management purposes, the Group has organised its operations into two reportable segments on the basis of
stage of development as follows:
• Development assets; and
• Exploration and evaluation assets, which includes assets that are associated with the determination and
assessment of the existence of commercial economic reserves.
The Board as a whole will regularly review the identified segments in order to allocate resources to the segment
and to assess its performance.
During the year ended 30 June 2014, the Group had no development assets. The Board considers that it has only
operated in one segment, being mineral exploration within Indonesia.
The Group is domiciled in Australia. All revenue from external customers are only generated from Australia and
Indonesia. No revenues were derived from a single external customer.
– 33 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 26:
FINANCIAL RISK MANAGEMENT
The Group has exposure to the following risks from their use of financial instruments:
credit risk;
liquidity risk; and
-
-
- market risk.
This note presents information about the Group’s exposure to each of the above risks, their objectives, policies
and processes for measuring and managing risk, and the management of capital.
The Board of Directors has overall responsibility for the establishment and oversight of the risk management
framework. Management monitors and manages the financial risks relating to the operations of the Group
through regular reviews of the risks.
Credit risk
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.
The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral
where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group’s exposure and
the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions is
spread amongst approved counterparties.
Credit risk related to balances with banks and other financial institutions is managed by the board. The board’s
policy requires that surplus funds are only invested with counterparties with a Standard & Poor’s rating of at least
AA-. All of the Group’s surplus funds are invested with AA Rated financial institutions.
The credit risk for counterparties included in cash and cash equivalents at 30 June 2014 is detailed below:
Financial assets:
Cash and cash equivalents
- AA rated counterparties
2014
$
2013
$
61,796
1,773,444
The Group does not have any material credit risk exposure to any single receivable or Group of receivables
under financial instruments entered into by the Group.
Liquidity risk
The responsibility with liquidity risk management rests with the Board of Directors. The Group manages liquidity
risk by monitoring forecast cash flows and ensuring that adequate working capital is maintained. The Group’s
policy is to ensure that it has sufficient cash reserves to carry out its planned exploration activities over the next
12 months.
Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity
prices will affect the Group’s income or the value of its holdings of financial instruments.
Interest rate risk
The Group is exposed to interest rate risk as it invests funds at floating interest rates.
Interest rate sensitivity analysis
At 30 June 2014, the effect on loss and equity as a result of a 2% increase in the interest rate, with all other
variables remaining constant would be a decrease in loss by $1,236 (2013: $35,469) and an increase in equity by
$1,236 (2013: $35,469). The effect on loss and equity as a result of a 2% decrease in the interest rate, with all
other variables remaining constant would be an increase in loss by $1,236 (2013: $35,469) and an decrease in
equity by $1,236 (2013: $35,469).
– 34 –
Krakatoa Resources Limited
& Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
NOTE 26:
FINANCIAL RISK MANAGEMENT (CONT.)
Fair value of financial instruments
The Directors consider that the carrying amount of financial assets and financial liabilities recorded in the
financial statements approximates their fair value.
Financial instruments measured at fair value
The financial instruments recognised at fair value in the statement of financial position have been analysed and
classified using a fair value hierarchy reflecting the significance of the inputs used in making the measurements.
The fair value hierarchy consists of the following levels:
- Quoted prices in active markets for identical assets and liabilities (level 1);
-
Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either
directly (as prices) or indirectly (derived from prices) (level 2); and
-
Inputs for the asset or liability that are not based on observable market data (unobservable inputs) (level 3).
2014
Financial assets
Fair value through profit or loss
-
Listed investments – held for trading
Level 1
Level 2
Level 3
$
865
$
-
$
-
2013
Financial assets
Fair value through profit or loss
-
Listed investments – held for trading
37,490
Level 1
Level 2
Level 3
$
$
-
$
-
Total
$
865
Total
$
37,490
Included within level 1 of the hierarchy are listed investments. The fair value of these financial assets have been
based on the closing quoted bid prices at the end of the reporting period, excluding transaction costs.
– 35 –
Krakatoa Resources Limited
& Controlled Entities
DIRECTORS’ DECLARATION
In accordance with a resolution of the Directors of Krakatoa Resources, I state that:
1. In the opinion of the directors:
(a)
the financial statements and notes of the Group are in accordance with the Corporations Act 2001,
including:
(i)
giving a true and fair view of the financial position of the Group as at 30 June 2014 and of its
performance for the year ended on that date; and
complying with Accounting Standards (including the Australian Accounting Interpretations)
and the Corporations Regulations 2001;
(ii)
(b)
(c)
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 financial statements and notes also comply with International Financial Reporting Standards as
disclosed in note 1.
2. This declaration has been made after receiving the declarations required to be made by the directors in
accordance with sections of 295A of the Corporations Act 2001 for the financial year ended 30 June 2014.
On behalf of the Board
Aryo Bimo
Executive Director
Dated: 19 September 2014
– 36 –
RSM Bird Cameron Partners
8 St George’s Terrace Perth WA 6000
GPO Box R1253 Perth WA 6844
T +61 8 9261 9100 F +61 8 9261 9101
www.rsmi.com.au
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
KRAKATOA RESOURCES LIMITED
Report on the Financial Report
We have audited the accompanying financial report of Krakatoa Resources Limited, which comprises the
statement of financial position as at 30 June 2014, the statement of comprehensive income, statement of changes
in equity and statement of cash flows for the year then ended, notes comprising a summary of significant
accounting policies and other explanatory information, and the directors' declaration of the consolidated entity
comprising the company and the entities it controlled at the year’s end or from time to time during the financial
year.
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 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. These Auditing Standards require that we comply with relevant
ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable
assurance 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 entity's preparation and fair presentation of the
financial report in order to design audit procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates
made by the directors, as well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinion.
Liability limited by a
scheme approved
under Professional
Standards Legislation
Major Offices in:
Perth, Sydney, Melbourne,
Adelaide and Canberra
ABN 36 965 185 036
RSM Bird Cameron Partners is a member of the RSM network. Each member
of the RSM network is an independent accounting and advisory firm which
practises in its own right. The RSM network is not itself a separate legal entity
in any jurisdiction.
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 Krakatoa 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 Krakatoa Resources Limited is in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2014 and of its
performance for the year ended on that date; and
(ii) 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.
Emphasis of Matter
Without qualifying our opinion, we draw attention to Note 1 in the financial report, which indicates that the
company and consolidated entity incurred losses of $1,794,175 and $1,884,114 respectively and the consolidated
entity had net cash outflows from operating activities of $1,563,031 during the year ended 30 June 2014. These
conditions, along with other matters as set forth in Note 1, indicate the existence of a material uncertainty which
may cast significant doubt about the company’s and consolidated entity’s ability to continue as going concerns
and therefore, the company and consolidated entity may be unable to realise their assets and discharge their
liabilities in the normal course of business.
Report on the Remuneration Report
We have audited the Remuneration Report included within the directors’ report for the year ended 30 June 2014.
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 Krakatoa Resources Limited for the year ended 30 June 2014
complies with section 300A of the Corporations Act 2001.
RSM BIRD CAMERON PARTNERS
Perth, WA
Dated: 19 September 2014
TUTU PHONG
Partner
Krakatoa Resources Limited
& Controlled Entities
CORPORATE GOVERNANCE STATEMENT
The Board recognises the need for the Group to operate with the highest standards of behaviour and
accountability.
The Group has considered the ASX Corporate Governance Council's Corporate Governance Principles and
Recommendations to determine an appropriate system of control and accountability to best fit its business and
operations commensurate with these guidelines.
The Group seeks to follow these recommendations for listed companies where appropriate for its size and
operations. In cases where the Group determines it would be inappropriate to follow the principles because of its
circumstances, the Group will provide reasons for not doing so in its Annual Report.
The Board will consider on an ongoing basis its Corporate Governance procedures and whether they are
sufficient given the Group’s nature of operations and size.
Compliance with the Recommendations
For ease of comparison
the
Recommendations and, where the Group has not followed a Recommendation, this is identified with the reasons
for not following the Recommendation.
following Section addresses each of
the Recommendations,
the
to
PRINCIPLES AND
RECOMMENDATIONS
COMMENT
1. Lay solid foundations for management and oversight
1.1 Companies should establish
the
functions reserved to the Board and
those delegated to senior executives and
disclose those functions.
1.2 Companies should disclose
the
process for evaluating the performance of
senior executives.
the
1.3 Companies should provide
information indicated in the Guide to
reporting on Principle 1.
2. Structure the board to add value
The Group’s Corporate Governance Manual includes a Board
Charter, which discloses the specific responsibilities of the Board.
The Board delegates responsibility for the day-to-day operations
and administration of the Group to the Executive Director. On
appointment, all Directors of the Group receive a letter of
appointment which sets out the terms and conditions of their
appointment.
The Group’s Corporate Governance Manual includes a section on
performance evaluation practices adopted by the Group. The
Board will review the performance of the Executive Director and
executives to ensure they execute the Group’s strategy through
the business
the efficient and effective
objectives. The Executive Director and executives will be
assessed against the performance of the Group and individual
performance.
implementation of
Explanation of departures from Principles and Recommendations
1.1 and 1.2 (if any) are set out above. No performance evaluation
of senior executives has taken place to date as this process is
conducted annually. Future annual reports will disclose whether
such a performance evaluation has taken place in the relevant
reporting period and whether it was in accordance with the
process disclosed. The Corporate Governance Manual, which
includes the Board Charter, is posted on the Group’s website.
– 39 –
Krakatoa Resources Limited
& Controlled Entities
PRINCIPLES AND
RECOMMENDATIONS
COMMENT
2.1 A majority of the Board should be
independent directors.
The Board consists of one executive Director and three non-
executive Directors. Details of each Board member’s experience,
expertise and qualifications are set out in the Director’s Report.
The Board has assessed the independence of the non-executive
Directors using defined criteria of independence and materiality
for
guidance
consistent with
Recommendation 2.1. The Board has determined that two of the
three non-executive directors are independent as defined under
Recommendation 2.1.
commentary
and
the
The Board has determined that the composition of the current
Board represents the best mix of directors that can understand
and competently deal with current and emerging business issues
and can effectively review and challenge the performance of
management. Furthermore, each individual member of the Board
is satisfied that all directors bring an independent judgment to bear
on Board decisions.
2.2 The chair should be an independent
director.
The Group is at variance with Recommendation 2.2 in that the
Board does not have an independent chair.
2.3 The roles of chair and chief executive
officer should not be exercised by the
same individual.
2.4 The Board should establish a
nomination committee.
2.5 Companies should disclose
the
process for evaluating the performance of
the Board, its committees and individual
directors.
2.6 Companies should provide the
information indicated in the Guide to
reporting on Principle 2.
The Board Charter summarises the roles and responsibilities of
the chairman and the Chief Executive Officer (once appointed).
As the whole Board only consists of three (3) members, the Group
does not have a nomination committee because it would not be a
more efficient mechanism than the full Board for focusing the
Group on specific issues.
The Board will review its performance each year to ensure
individual directors and the Board as a whole work efficiently in
achieving their functions as set out in the Board charter. The
Board as a whole discusses and analyses its own performance
during the year including suggestions for change or improvement.
The Board may also utilise the services of an external party to
review the performance of the Board.
In accordance with the guide to reporting on Principle 2, a
description of the procedure for the selection appointment of new
directors and the re-election of current directors is available from
the corporate governance section of the Group’s website.
3. Promote ethical and responsible decision-making
3.1 Companies should establish a code
of conduct and disclose the code or a
summary of the code as to:
The Board has adopted a Code of Conduct which applies to all
directors and officers of the Group. It sets out Krakatoa’s
commitment
in
laws and regulations while
accordance with all applicable
demonstrating and promoting the highest ethical standards. The
Code of Conduct reflects the matters set out in the commentary
integrity
and guidance for Recommendation 3.1.
to successfully conducting
the business
in
the Group’s
• the practices necessary to maintain
confidence
• the practices necessary to take into
account their legal obligations and the
reasonable
their
expectations
stakeholders
• the responsibility and accountability of
individuals for reporting and investigating
reports of unethical practices.
of
– 40 –
Krakatoa Resources Limited
& Controlled Entities
PRINCIPLES AND
RECOMMENDATIONS
COMMENT
3.2 Companies should establish a policy
concerning diversity and disclose the
policy or a summary of that policy. The
policy should include requirements for the
board
establish measureable
objectives for achieving gender diversity
and for the Board to assess annually both
the objectives and progress in achieving
them.
to
The Board has adopted a Diversity Policy which sets out the
Group’s aims and practices
in relation to recognising and
respecting diversity in employment. The Policy reinforces the
Group’s commitment to actively managing diversity as a means of
enhancing the Group’s performance by recognising and utilising
the contributions of diverse skills and talent from its employees.
The Diversity Policy reflects the matters set out in the commentary
and guidance for Recommendation 3.2.
3.3 Companies should disclose in each
annual report the measureable objectives
for achieving gender diversity set by the
Board in accordance with the diversity
policy and progress in achieving them.
The Board continues to monitor diversity across the organisation
and is satisfied with the current level of gender diversity within the
Company. Due to the size of the company and its small number of
employees, the Board does not consider it appropriate at this time,
to formally set measurable objectives for gender diversity.
3.4 Companies should disclose in each
annual report the proportion of women
employees in the whole organisation,
women in senior executive positions and
women on the Board.
The Company is committed to setting measurable objectives for
attracting and engaging women of the board level, in senior
management and across the whole organisation. As at the date of
this report, the Company has the following proportion of women
appointed:
to the Board - nil
to senior management – nil
to the organisation – 14%
3.5 Companies should provide
the
information indicated in the Guide to
reporting on Principle 3.
In accordance with the guide to reporting on Principle 3, the
Group’s Code of Conduct and Diversity Policy is available from the
corporate governance section of the Group’s website.
4. Safeguard integrity in financial reporting
4.1 The Board should establish an audit
committee.
Due to the size and scale of operations of the Group the full Board
undertakes the role of the Audit Committee. In the absence of a
formal audit committee the Board considers the issues that would
otherwise be considered by the audit committee. A copy of the
Audit Committee Charter is available on the Group’s website.
4.2 The audit committee should be
structured so that it:
The Group is at variance with Recommendation 4.2 in that full
Board undertakes the role of the Audit Committee, which consists
of an executive and non-independent directors.
• consists only of non-executive directors
• consists of a majority of independent
directors
• is chaired by an independent chair, who
is not chair of the board
• has at least three members
4.3 The audit committee should have a
formal charter.
in
the commentary and guidance
The Audit and Risk Committee charter sets out
its role,
responsibilities and membership requirements and reflects the
matters set out
for
Recommendation 4.3. Consistent with the Group’s Audit and Risk
Committee Charter, the Audit and Risk Committee reviews the
external auditor’s terms of engagement and audit plan, and
assesses the independence of the external auditor. The current
practice, subject to amendment in the event of legislative change,
is for the rotation of the engagement partner to occur every five
years.
4.4 Companies should provide
the
information indicated in the Guide to
reporting on Principle 4.
In accordance with the guide to reporting on Principle 4, the
Group’s Audit and Risk Committee charter is available from the
corporate governance section of the Group’s website.
5. Make timely and balanced disclosure
– 41 –
Krakatoa Resources Limited
& Controlled Entities
PRINCIPLES AND
RECOMMENDATIONS
COMMENT
5.1 Companies should establish written
policies designed to ensure compliance
with ASX Listing Rule disclosure
requirements
ensure
and
accountability at a senior executive level
for that compliance and disclose those
policies or a summary of those policies.
to
The Group’s Continuous Disclosure Policy sets out the key
obligations of
to
the Directors and employees
continuous disclosure as well as the Group’s obligations under the
Listing Rules and the Corporations Act. The Policy also provides
procedures for internal notification and external disclosure, as well
as procedures for promoting understanding of compliance with the
disclosure requirements for the monitoring of Group compliance.
The Policy reflects the matters set out in the commentary and
guidance for Recommendation 5.1.
in relation
5.2 Companies should provide the
information indicated in Guide to
Reporting on Principle 5.
6. Respect the rights of shareholders
should design a
6.1 Companies
for promoting
communications policy
with
effective
their
shareholders and encouraging
participation at general meetings and
disclose their policy or a summary of that
policy.
communication
6.2 Companies should provide
the
information indicated in the Guide to
reporting on Principle 6.
7. Recognise and manage risk
7.1 Companies should establish policies
for the oversight and management of
material business risks and disclose a
summary of those policies.
The
board
should
7.2
require
management to design and implement
the risk management and internal control
system to manage the Group’s material
business risks and report to it on whether
those
being managed
effectively. The board should disclose
that management has reported to it as to
the effectiveness of
the Group’s
management of its material business
risks.
risks
are
include
required by
The Group will
Recommendation 5.2 in its future annual reports. In accordance
with the guide to reporting on Principle 5, the Group’s Continuous
Disclosure Policy is available from the corporate governance
section of the Group’s website.
disclosure
the
The Shareholder Communications Policy sets out the Group’s
aims and practices in respect of communicating with both current
and prospective Shareholders. The Policy reinforces the Group’s
commitment to promoting investor confidence and reflects the
matters set out
for
in
Recommendation 6.1.
the commentary and guidance
include
The Group will
required by
Recommendation 6.2 in its future annual reports. In accordance
with the guide to reporting on Principle 6, the Group’s Shareholder
Communication Policy is available from the corporate governance
section of the Group’s website.
disclosure
the
Krakatoa recognises that risk is inherent to any business activity
and that managing risk effectively is critical to the immediate and
future success of the Group. As a result, the Board has adopted a
Risk Management Policy which sets out the Group’s system of risk
oversight, management of material business risks and internal
control.
Krakatoa’s risk management framework is supported by the Board
of Directors, management and the Audit and Risk Committee. The
Board is responsible for approving and reviewing the Group’s risk
management strategy and policy. Management are responsible for
monitoring that appropriate processes and controls are in place to
effectively and efficiently manage risk. The Audit and Risk
Committee also has delegated responsibilities in relation to risk
management and the financial reporting process as set out in the
Group’s Audit and Risk Committee Charter.
7.3 The board should disclose whether it
has received assurance from the chief
executive officer (or equivalent) and the
chief financial officer (or equivalent) that
the declaration provided in accordance
with section 295A of the Corporations Act
is founded on a sound system of risk
management and internal control and
that the system is operating effectively in
all material respects in relation to
financial reporting risks.
When considering the Audit and Risk Committee’s review of
financial reports, the Board will receive a written statement
declaration in accordance with section 295A of the Corporations
Act, signed by the Executive Director and Chief Financial Officer,
stating whether, amongst other things, the Group’s financial
reports give a true and fair view, in all material respects, with the
Group’s financial position and performance and comply with
relevant accounting standards. This statement will also confirm
whether the Group’s financial reports are founded on a sound
system of risk management and internal control and whether the
system is operating effectively in relation to financial reporting
risks. Similarly, in a separate written statement the Executive
– 42 –
Krakatoa Resources Limited
& Controlled Entities
PRINCIPLES AND
RECOMMENDATIONS
COMMENT
Director and the Chairman of the Audit and Risk Committee will
also confirm to the Board whether the Group’s risk management
and internal control systems are operating effectively in relation to
material business risks for the period, and that nothing has
occurred since period-end that would materially change the
position.
7.4 Companies should provide
information
in Guide
indicated
Reporting on Principle 7.
the
to
In accordance with the guide to reporting on Principle 7, the
Group’s Audit and Risk Committee Charter is available from the
corporate governance section of the Group’s website.
8. Remunerate fairly and responsibly
8.1 The board should establish a
remuneration committee.
As the whole Board only consists of three (3) members, the Group
does not have a remuneration committee because it would not be
a more efficient mechanism than the full Board for focusing the
Group on specific issues.
8.2 The remuneration committee should
be structured so that it:
• consists of a majority of independent
directors
The Group is at variance with Recommendation 8.2 in that full
Board undertakes the role of the Nomination and Remuneration
Committee, which consists of an executive and non-independent
directors.
• is chaired by an independent director
• has at least three members
8.3 Companies should clearly distinguish
the structure of non-executive directors’
remuneration
that of executive
directors and senior executives.
from
from
The structure of non-executive directors’ remuneration is clearly
that of executive directors and senior
distinguished
executives. Remuneration for non-executive directors is fixed.
Total remuneration for all non-executive directors, last voted upon
by shareholders at the 2012 General Meeting, is not to exceed
$250,000 per annum.
Neither the non-executive directors nor the executives of the
Group receive any retirement benefits, other than superannuation.
The Executive Director is employed pursuant to an employment
agreement, which is summarised in the Director’s Report.
the
8.4 Companies should provide
information indicated in the Guide to
reporting on Principle 8.
In accordance with the guide to reporting on Principle 8, the
Group’s Nomination and Remuneration Committee Charter is
available from the corporate governance section of the Group’s
website.
– 43 –
Krakatoa Resources Limited
& Controlled Entities
ASX INFORMATION
AS AT 31 AUGUST 2014
The following additional information is required by the ASX Limited in respect of listed public companies and was
applicable at 31 August 2014.
1.
Shareholding
a.
Distribution of Shareholders
Number (as at 31 August 2014)
Category (size of holding)
Shareholders
Ordinary Shares
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
21
7
129
196
52
405
584
25,907
1,275,425
8,309,080
26,389,007
36,000,003
b.
The number of shareholdings held in less than marketable parcels is 25 shareholders amounting to 11,491
shares.
c.
The followings securities are restricted at 31 August 2014:
-- 10,060,000 ordinary shares fully paid until 28 December 2014
d.
The names of substantial shareholders listed in the company’s register as at 31 August 2014 are:
Shareholder
Ordinary Shares
Asia Mineral Trade Pte Ltd
CK Locke & Partners Pty Ltd
5,000,000
1,866,667
%Held of Total
Ordinary Shares
13.89%
5.19%
e.
Voting Rights
The voting rights attached to the ordinary shares are as follows:
Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a
meeting or by proxy has one vote on a show of hands.
– 44 –
Krakatoa Resources Limited
& Controlled Entities
f.
20 Largest Shareholders as at 31 August 2014 — Ordinary Shares
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
ASIA MINERAL TRADE PTE LTD
CK LOCKE & PARTNERS PTY LTD
LINKWELL LTD
CV INDO PROJECT SERVICES
CV JAVA HOLDINGS
LUCKY BILLION INVESTMENTS LTD
ASGAR ALI DJUHAEPA
HOLLOW POINT HOLDINGS LTD
UNIVERSAL FIRM LIMITED
STELLAR SECURITITES PTY LTD
PROF YEW KWANG NG
12. MR JOHN ROBERT TYRRELL + MS CLAIRE KATHERINE
TYRRELL
13.
DR RONALD JOHN BOND
14. GILPIN PARK PTY LTD
15.
RJB MEDICAL PTY LTD
16. MR GREGG CHRISTOPHER FREEMANTLE
17. MRS TAOLA BALDWIN
18.
19.
NOBEL INTERNATIONAL LIMITED
DR SHIRLEY THEIN GI LIM
20. MR MURRAY WILLIAM BROUN
Number of
Ordinary Fully
Paid Shares
Held
% Held of
Issued
Ordinary
Capital
5,000,000
13.89
1,866,667
1,445,000
1,250,000
1,250,000
1,055,000
1,000,000
1,000,000
1,000,000
933,333
700,000
600,000
500,000
500,000
500,000
410,000
400,000
368,809
340,000
325,000
5.19
4.01
3.47
3.47
2.93
2.78
2.78
2.78
2.59
1.94
1.67
1.39
1.39
1.39
1.14
1.11
1.02
0.94
0.90
20,443,809
56.78
2.
The name of the company secretary is David Palumbo.
3.
The address of the principal registered office in Australia is:
Level 11, 216 St Georges Terrace Perth WA 6000
4.
Registers of securities are held at the following address:
Computershare Investor Services Pty Ltd, Level 2, 45 St Georges Terrace, Perth WA 6000
5.
Stock Exchange Listing
Quotation has been granted for all the ordinary shares of the company on all Member Exchanges of the
ASX Limited.
6.
Unquoted Securities
The Company has 1,000,000 $0.20 unlisted options expiring on or before 30 June 2015 on issue.
– 45 –
Krakatoa Resources Limited
& Controlled Entities
7.
Quoted Options over Unissued Shares ($0.20 options – expiry 30 June 2015)
A total of 14,500,002 $0.20 options are on issue. Each option can be exercised upon the payment of
$0.20 and will receive one ordinary share. The expiry date for the options is 30 June 2015.
20 Largest Shareholders as at 31 August 2014 — $0.20 options expiring on or before 30 June 2015
1.
2.
3.
4.
5.
6.
7.
8.
9.
YORK RICH (CHINA) LTD
STELLAR SECURITITES PTY LTD
PROF YEW KWANG NG
MR MURRAY WILLIAM BROUN
RJB MEDICAL PTY LTD
MS SALLY JUDITH MOLYNEUX
DR RONALD JOHN BOND
EAGLE EYE NOMINEES PTY LTD
ARCHFIELD HOLDINGS PTY LTD
10. MR TERRY JAMES GARDINER + MRS VICTORIA HELEN
GARDINER
11. MR ALF TOMMY HARSTROM
12. MISS FELICITY ANNE WISBEY
13.
14.
15.
PROFESSOR YEW KWANG NG
CICCHINO PTY LTD
DR SHIRLEY THEIN GI LIM
16. MR STEPHEN BROCKHURST
17. MS SUSAN FIDLER
18.
19.
20.
KOUTA BAY PTY LTD
STRATUM METALS LIMITED
TILPA PTY LTD
Number of
$0.20 Options
Held
% Held of
$0.20
Options
6,000,000
41.38
466,667
350,000
339,243
333,334
292,900
250,000
250,000
242,500
189,750
162,500
155,713
150,000
137,500
135,000
125,000
125,000
125,000
125,000
125,000
3.22
2.41
2.34
2.30
2.02
1.72
1.72
1.67
1.31
1.12
1.07
1.03
0.95
0.93
0.86
0.86
0.86
0.86
0.86
10,080,107
69.49
8.
Use of Cash and Assets
The Company used the cash and assets in a form readily convertible to cash that it had at the time of
admission in a way consistent with its business objectives stated in the company’s prospectus dated 28
September 2012.
– 46 –
Krakatoa Resources Limited
& Controlled Entities
SCHEDULE OF MINERAL TENEMENTS
AS AT 31 AUGUST 2014
Project
Tenement
Interest held by
Krakatoa Resources Limited
DONGGALA
IUP No.188.45/0465/DESDM
80%
BCS
IUP No.540/23/IUP/DESDM/BUP-2010
99.8%
– 47 –