(ABN 53 090 772 222)
Financial Report
For the year ended 30 June 2009
Lindian Resources Limited
Corporate Directory
Directors
Reginald N Gillard
Gregory L Smith
Anthony R Cunningham
Patrick J Flint
Non-Executive Chairman
Managing Director
Non-Executive Director
Non-Executive Director
Company Secretary
Paul Jurman
Registered and Administrative
Office
Ground Floor
30 Ledgar Road
Balcatta WA 6021
Telephone:
Facsimile:
(61 8) 9345 2478
(61 8) 9240 2406
Principal Place of Business
Ground Floor
30 Ledgar Road
Balcatta Western Australia 6021
Share Registry
Computershare Investor Services Pty Ltd
Level 2, 45 St George’s Terrace
Perth WA 6000
Solicitors
Auditors
Steinepreis Paganin
Level 4, 16 Milligan Street
Perth WA 6000
RSM Bird Cameron Partners
8 St George’s Terrace
Perth WA 6000
Stock Exchange Listings
Australian Securities Exchange
(Code – LIN, LINO & LINOA)
Page 1
Lindian Resources Limited
Contents
Review of Operations
Directors’ Report
Statement of Corporate Governance Practices
Auditor’s Independence Declaration
Income Statements
Balance Sheets
Statements of Changes in Equity
Statements of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Mineral Interests Schedule
Additional Shareholder Information
Page Numbers
3-6
7-14
15-21
22
23
24
25-26
27
28-57
58
59-60
61
62-64
Page 2
Lindian Resources Limited
Review of Operations
Exploration
The Company’s main focus during the year was on exploration of the Dinguiraye Pt-Ni-Cu Project located in
Guinea, West Africa. This project has demonstrated excellent potential to host PGE / Ni sulphide
mineralisation and following granting of the initial exploration licence in March 2009 the pace of exploration
has been increased. A second exploration licence was granted in September 2009.
Exploration is ongoing at the Bafwasende Gold / Diamond Project in the Democratic Republic of the Congo
where results of the kimberlitic indicator mineral sampling are awaited.
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ki l om etr es
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ki l om etr es
ki l om et res
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Bafwasende
Bafwasende
Bafwasende
Bafwasende
Bafwasende
Bafwasende
Bafwasende
Bafwasende
Bafwasende
Project
Project
Project
Project
Project
Project
Project
Project
Project
DRCDRCDRCDRCDRCDRCDRCDRCDRC
Dinguiraye
Dinguiraye
Dinguiraye
Dinguiraye
Dinguiraye
Dinguiraye
Dinguiraye
Dinguiraye
Dinguiraye
Project
Project
Project
Project
Project
Project
Project
Project
Project
Guinea
Guinea
Guinea
Guinea
Guinea
Guinea
Guinea
Guinea
Guinea
20º
0º
-20º
-40º
Figure 1 - Location Plan Dinguiraye – Bafwasende Projects
Dinguiraye Pt-Ni-Cu Project (92% interest)
The Project, located at the town of Dinguiraye approximately 400km northeast of Conakry in the central part
of Guinea consists of 2 granted exploration licences covering 705km2. (Figures 2 and 3).
Figure 2 – Location Plan
Figure 3 – Licence Location Plan
Page 3
Lindian Resources Limited
Review of Operations
Exploration
Exploration to date has demonstrated the excellent potential of the Dinguiraye Intrusive to host magmatic
accumulations of PGE - Ni sulphides. In addition to previously completed exploration, during the year the
Company acquired SRTM (shuttle radar topography mission) data to enhance the regional and local structural
interpretation, completed infill and extension soil geochemistry and contracted Fugro to fly airborne magnetics
and radiometrics. The airborne survey was completed in July 2009.
Structurally the Dinguiraye Intrusive occurs within a crustal scale extensional zone at the contact between an
Archean craton and the Siguiri Basin sediments and volcanics.
Three fault bounded plateaus defined faulting have been defined. The relationship of the geochemistry to the
structure is as follows:
Block 1: coincident Pt and Ni anomalism forms an open ended 12,500m long by 1,000m wide anomaly along
the southern scarp of the Block 1 plateau.
Block 2: anomalous Pt and Cr are coincident over 7,000m while Ni anomalism occurs coincident with the
southern portion of the Pt-Cr anomaly.
Block 3: a large 5,000m x 1,500m Pt anomaly is present with coincident anomalous Pd, Ni, Cu and Cr in part.
Figure 4 – Pt-Ni-Cr Soil Geochemical Anomalies over DTM
The three anomalies identified to date are considered highly prospective The distribution and strong anomalous
correlation of the various elements, their lateral continuity and the regional geological and structural setting auger
well for the prospect to host magmatic accumulations of PGE and Ni sulphides similar to those found in the
globally recognised PGE - Ni sulphide deposits.
A drilling programme is planned for October 2009.
Page 4
Lindian Resources Limited
Review of Operations
Bafwasende Project (80% interest)
The Bafwasende Project consists of 44 exploration licences covering approximately 7,000 square kilometres
located 220kms north east of Kisangani (the provincial capital) in Province Orientale in the north east of the
Democratic Republic of the Congo (Figure 1).
Geological Setting
The Bafwasende Gold / Diamond Project is underlain by the Neo Proterozoic sedimentary rocks of the
Lindian Group ranging from mudstone to conglomerates with inter-bedded carbonate.
Figure 5 – Bafwasende Project – Landsat Interpretation – Sample Location
Diamond Joint Venture
In April 2008 the Company signed a joint venture with BRC DiamondCore Ltd (BRC) giving BRC the right to
earn a 65% interest in the diamond potential of the project.
Exploration
A multi-element analysis was undertaken on the 240 stream sediment samples received under the terms of a
joint venture signed with BRC DiamondCore Ltd (BRC). Results have defined a semi-circular Ni (Nickel),
Cr (chrome) anomaly measuring 20km x 50km in the southern portion of the licence area. This anomaly is
interpreted to result from the presence of mafic rocks, either unmapped volcanics or intrusives, potentially of
kimberlitic composition (figure 4).
BRC is undertaking the kimberlitic indicator mineral determination.
Page 5
Lindian Resources Limited
Review of Operations
Other Activities
In June 2009 the Company issued a prospectus pursuant to a fully underwritten, pro-rata (on the basis of one
option for every three shares held) non-renounceable entitlement issue of options (at a price of one cent each).
The options have an exercise price of 15 cents each and an expiry date of 31 December 2011.
The issue closed on 24 July 2009 and 12,609,341 options were allotted and dispatched on 4 August 2009. The
funds raised will be used to contribute to the exploration programme at the Dinguiraye Pt-Ni-Cu project in
Guinea.
Scientific or technical information in this report has been prepared under the supervision of Mr Greg Smith, a director of
the Company and a member of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr Smith has sufficient
experience which is relevant to the style of mineralisation under consideration and to the activity which he is undertaking
to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves” (the JORC Code). Mr Smith consents to the inclusion in this
report of the Information, in the form and context in which it appears.
Page 6
Lindian Resources Limited
Directors’ Report
Your Directors present their report together with the financial report of Lindian Resources Limited (“the
Company”) and its controlled entities (the “consolidated entity”) for the year ended 30 June 2009 and the auditor’s
report thereon. In order to comply with the provisions of the Corporations Act, the Directors report as follows:
DIRECTORS
The names and details of the Directors in office during or since the end of the financial year are as follows.
Directors were in office for the entire year unless otherwise stated.
Names, qualifications, experience and special responsibilities
Reginald N Gillard BA FCPA FAICD JP - Non-Executive Chairman
(Appointed 30 October 2006)
Reg Gillard has been involved in the resources sector for over 20 years, and is currently focused on corporate
management, corporate governance and the evaluation and acquisition of businesses. He has considerable
experience in acquiring mineral projects (particularly in Africa) and in raising funds for the exploration and
development of such projects. Prior to this Mr Gillard practised as an accountant, during which time he formed and
developed a number of service related businesses. He is a non-executive chairman of Aspen Group Ltd, Caspian
Oil & Gas Limited, Perseus Mining Limited, Eneabba Gas Limited, Tiger Resources Limited, Platina Resources
Limited (from 2 July 2009) and he also served as non-executive chairman of Lafayette Mining Limited (resigned
20 June 2008), Pioneer Nickel Limited (resigned 13 June 2008) and Elemental Minerals Limited (resigned 30 June
2008).
Gregory L Smith – BSc, AUSIMM (Managing Director)
(Appointed 30 October 2006)
Mr Smith has a BSc in Geology from Dalhousie University in Canada. He is a Fellow of the Geological
Association of Canada and a Member of the Australasian Institute of Mining and Metallurgy. Mr Smith has 30
years experience gained as an exploration and mining geologist in Canada, Africa, Australia and South East Asia in
both staff and consulting roles. Most recently Mr Smith was exploration manager for Moto Goldmines Ltd on the
Moto Gold Project in the DRC. He previously served as a director of Elemental Minerals Limited (from 30 January
2007, resigned 11 March 2009).
Patrick J Flint – CA, B.Com (Non-Executive Director)
(Appointed 30 October 2006)
Patrick Flint is a chartered accountant with significant experience in the management of publicly listed mineral
exploration companies. He has been involved in numerous capital raisings and project acquisitions. He is also an
executive director of Tiger Resources Limited (from 9 January 2007) and a non-executive director of Erongo
Energy Limited (from 23 November 2006) and Zedex Minerals Limited (from 1 May 2007, resigned 15 July 2009),
and company secretary of Red Metal Limited (all of which are listed on the Australian Stock Exchange).
Gavin J Argyle – B.Com, MBA (Non–Executive Director)
(Resigned 4 March 2009)
Mr Gavin Argyle has over 15 years experience in investment banking and stock broking in Australia. Prior to
investment banking, Gavin was a Senior Staff member at Western Mining Corporation Limited. Gavin has served
on the board of numerous Australian and US listed and private companies in executive and non-executive
positions. He is currently a Managing Director of Capital Investment Partners Pty Limited. His qualifications
include a Bachelor of Commerce from the University of Western Australia and an MBA from the Wharton
Business School at the University of Pennsylvania. He was also a director of Biron Apparel Limited (resigned 22
October 2007).
Page 7
Lindian Resources Limited
Directors’ Report
DIRECTORS – continued
Names, qualifications, experience and special responsibilities - continued
Anthony R Cunningham – (Non–Executive Director)
(Appointed 4 March 2009)
Mr Cunningham is currently Managing Director of CPS Securities, an AFSL Licence holder specialising in advice
to retail and wholesale clients. He has been instrumental in raising capital for many exploration companies from
IPO to production and brings over 15 years of mining and stock market experience. Mr Cunningham holds a
Bachelor of Commerce and is in the final year of a Graduate Diploma in Applied Geology.
COMPANY SECRETARY
Paul Jurman – CPA, B Com
(Appointed 30 October 2006)
Mr Jurman is a CPA with over 10 years experience and has been involved with a diverse range of Australian public
listed companies in company secretarial and financial roles. He is also company secretary of Erongo Energy
Limited, Carnavale Resources Limited, Verus Investments Limited and SA Metals Limited.
PRINCIPAL ACTIVITIES
The principal activity of the consolidated entity is the exploration and evaluation of mineral interests.
RESULTS AND DIVIDENDS
The consolidated loss for the year after income tax was $1,216,774 (2008: $696,472). No dividends were paid
during the year and the Directors do not recommend payment of a dividend.
EARNINGS PER SHARE
Basic loss per share for the year was 3.14 cents (2008: 2.10 cents).
REVIEW OF OPERATIONS
A review of operations of the consolidated entity during the year ended 30 June 2009 is provided in the section
headed "Review of Operations" immediately preceding this Directors’ Report.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Significant changes in the state of affairs of the consolidated entity during the financial year were as follows:
On 27 February 2009, the Company was granted an exploration permit (comprising four components)
covering a total of 394km2 on the Dinguiraye Pt-Ni-Cu Project located in Guinea, West Africa.
EVENTS SUBSEQUENT TO BALANCE DATE
In June 2009 the Company issued a prospectus pursuant to a fully underwritten, pro-rata (on the basis of one option
for every three shares held) non-renounceable entitlement issue of options (at a price of one cent each. The issue
closed on 24 July 2009 and 12,609,341 options were allotted and dispatched on 4 August 2009.
In September 2009 the Company was granted a second exploration permit covering 311km2 at the Dinguiraye Pt-
Ni-Cu Project located in Guinea, West Africa.
No other matters or circumstances have arisen since the end of the financial year which have significantly affected
or may significantly affect the operations, results or state of affairs of the Company in subsequent financial years.
Page 8
Lindian Resources Limited
Directors’ Report
LIKELY DEVELOPMENTS
The consolidated entity remains committed to adding to shareholder wealth through the development of its mineral
interests.
DIRECTORS’ MEETINGS
The number of meetings of the Directors and the number of meetings attended by each Director during the year
ended 30 June 2009 were:
Directors’ meetings held during
period of office
Directors’ meetings attended
R N Gillard
G L Smith
P J Flint
G J Argyle
A R Cunningham
5
5
5
3
2
5
5
5
1
2
The Company does not have audit, remuneration or nomination committees. Due to the small size of the board all
matters that would be addressed by committees are dealt with by the full board of directors.
DIRECTORS’ INTERESTS
The interests of each Director in the shares and options of the Company at the date of this Report are as follows:
Fully Paid Ordinary Shares
R N Gillard
G L Smith
P J Flint
A R Cunningham
810,541
733,952
517,541
100,000
Options Over
Ordinary
Shares
1,446,284
1,366,619
1,166,118
378,250
Options granted to directors' and officers and analysis of share-based payments granted as remuneration
The Company has not granted any options over unissued ordinary shares during or since the end of the financial
year to any Directors or officers as part of their remuneration.
During or since the end of the financial year, 3,000,000 options over unissued ordinary shares in the Company
were forfeited by Directors of the Company. No options were exercised by Directors or officers during or since the
end of the financial year.
Page 9
Lindian Resources Limited
Directors’ Report
SHARE OPTIONS
As at the date of this report, there are 32,534,730 options over unissued ordinary shares in the Company
outstanding, summarised as follows:
Listed Options:
Listed Options:
Unlisted Options:
Unlisted Options:
Unlisted Options:
Unlisted Options:
Unlisted Options:
Number
Exercise Price
$
Expiry Date
17,380,754
12,608,976
495,000
1,000,000
200,000
350,000
500,000
$0.30
$0.15
$0.20
$0.20
$0.30
$0.35
$0.30
31 December 2009
31 December 2011
31 December 2010
1 July 2011
30 September 2010
30 September 2010
31 December 2011
These options do not entitle the holder to participate in any share issue of the Company or any other body
corporate. There are no options to subscribe for shares in any controlled entity.
No options were granted during the financial year. Options granted since the end of the financial year are as
follows:
• On 4 August 2009, 12,609,341 listed options, exercisable at $0.15 each on or before 31 December 2011,
were allotted at an issue price of $0.01.
Options that have lapsed during or since the end of the financial year are as follows:
• 3,000,000 options exercisable at 30 cents before 15 September 2009.
Shares issued on exercise of options
During or since the end of the financial year, the Company has issued the following ordinary shares as a result of
the exercise of options.
Number of
shares
Amount paid on
each share
1,125
365
$0.30
$0.15
For details on the valuation of the options issued during the prior year, including models and assumptions used,
please refer to Note 17. There were no alterations to the terms and conditions of options granted as remuneration
since their grant date.
Page 10
Lindian Resources Limited
Directors’ Report
REMUNERATION REPORT (Audited)
This report outlays the remuneration arrangements in place for the Directors and executives (as defined under
section 300A of the Corporations Act 2001) of Lindian Resources Limited.
It also provides the remuneration disclosures required by paragraphs Aus 25.4 to Aus 25.7.2 of AASB 124
“Related Party Disclosures”, which have been transferred to the Remuneration Report in accordance with
Corporations Regulations and have been audited.
The following were Directors and executives of the Company during or since the end of the financial year.
Non Executive Directors
Mr Reginald Gillard
Mr Patrick Flint
Mr Gavin Argyle
Mr Anthony Cunningham
Managing Director
Mr Gregory Smith
Other Senior Management
The term ‘senior management’ is used in this remuneration report to refer to the following persons. Except as
noted the named persons held their current position for the whole of the financial year and since the end of the
financial year:
Paul Jurman – Company Secretary.
Remuneration philosophy
The performance of the Company depends upon the quality of the directors and executives. The philosophy of the
Company in determining remuneration levels is to:
- set competitive remuneration packages to attract and retain high calibre employees;
- link executive rewards to shareholder value creation; and
- establish appropriate performance hurdles for variable executive remuneration.
Options Issued as part of remuneration for the year ended 30 June 2009
No options have been issued to directors and executives as part of their remuneration during the current year.
Remuneration structure
In accordance with best practice corporate governance, the structure of remuneration for non-executive Directors
and executive Directors is separate and distinct.
Non-executive Directors’ remuneration
Objective
The Board seeks to set aggregate remuneration at a level which provides the Company with the ability to attract
and retain directors of the highest calibre, whilst incurring a cost which is acceptable to shareholders.
Structure
The ASX Listing Rules specify that the aggregate remuneration of non-executive Directors shall be determined
from time to time by the shareholders in general meeting. An amount not exceeding the amount determined is then
divided between the non-executive Directors as agreed. The latest determination was at a general meeting on 21
November 2003 when shareholders approved an aggregate remuneration of $150,000 per year.
Each director receives a fee for being a director of the company. The remuneration of the non-executive Directors
for the year ending 30 June 2009 is detailed in Table 1 of this report.
Page 11
Lindian Resources Limited
Directors’ Report
REMUNERATION REPORT - continued
Executive Directors’ remuneration
Mr Smith is the Managing Director of the Company and is entitled to Director Fees of $100,000 per annum plus
superannuation.
Options issued to Directors and executives
30 June 2009
R N Gillard
G L Smith
P J Flint
G J Argyle
A R Cunningham
P Jurman
Total
30 June 2008
R N Gillard
G L Smith
P J Flint
G J Argyle
P Jurman (i)
Total
Granted
No.
Granted as
remuneration
$
Remuneration
represented by
options %
Options
Exercised
Options
Lapsed
$
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Granted
No.
Granted as
remuneration
$
Remuneration
represented by
options %
Options
Exercised
Options
Lapsed
$
$
-
-
-
-
-
-
-
-
350,000
350,000
58,100
58,100
-
-
-
-
73.0%
-
-
-
-
-
-
-
-
-
-
-
-
The fair value of the options was calculated using a Black and Scholes model. The following factors and
assumptions were taken into account in determining the fair value of options on the grant date.
Grant Date
Expiry Date
Fair value
per
option
Exercise
price
Price of shares
on valuation
date
Expected
Volatility
(i) 30 November 2007
30 September 2010 16.6 cents
35 cents
34 cents
70%
Risk free
interest
rate
6.75%
Dividend
yield
-
For details on the valuation of the options, including models and assumptions used, please refer to Note 17. There
were no alterations to the terms and conditions of options granted as remuneration since their grant date.
Page 12
Lindian Resources Limited
Directors’ Report
REMUNERATION REPORT - continued
Table 1 – Director’s and executive remuneration for the year ended 30 June 2009
30 June 2009
Directors
R N Gillard
G L Smith
P J Flint
G J Argyle
A R Cunningham
P Jurman
30 June 2008
Directors
R N Gillard
G L Smith
P J Flint
G J Argyle
P Jurman
Short-term
Post
Employment
Share
Based
Payment
Remuneration
represented
by options
Total
Salary &
Fees
Other
Super
Options
$
$
$
$
$
%
33,333
1,760
100,000
1,760
23,336
1,760
16,667
1,173
6,505
587
3,000
9,000
2,100
-
585
13,333
1,760
1,200
193,174
8,800
15,885
-
-
-
-
-
-
-
38,093
110,760
27,196
17,840
7,677
16,293
217,859
-
-
-
-
-
-
Short-term
Post
Employment
Share
Based
Payment
Remuneration
represented
by options
Total
Salary &
Fees
Other
Super
Options
$
$
$
$
$
%
40,000
1,776
100,000
1,776
45,000
1,776
31,108
1,776
3,600
9,000
4,050
-
-
-
-
-
45,376
110,776
50,826
32,884
-
-
-
-
20,000
1,776
1,800
58,100
81,676
71%
236,108
8,880
18,450
58,100
321,538
Page 13
Lindian Resources Limited
Directors’ Report
INDEMNIFICATION AND INSURANCE OF DIRECTORS, OFFICERS AND AUDITORS
The Company has agreed to indemnify the directors and previous directors of the Company, against all liabilities to
another person that may arise from their position as directors of the Company and its controlled entities, except
where the liability arises out of conduct involving a lack of good faith.
During the financial year the Company agreed to pay an annual insurance premium of $8,800 in respect of
directors’ and officers’ liability and legal expenses’ insurance contracts, for directors, officers and employees of the
Company. The insurance premium relates to:
•
costs and expenses incurred by the relevant officers in defending proceedings, whether civil or criminal and
whatever the outcome;
• other liabilities that may arise from their position, with the exception of conduct involving a wilful breach
of duty.
ENVIRONMENTAL REGULATIONS
The Consolidated Entity is aware of its environmental obligations with regards to its exploration activities and
ensures that it complies with all regulations when carrying out any exploration work.
AUDITOR INDEPENDENCE AND NON-AUDIT SERVICES
Section 307C of the Corporations Act 2001 requires our auditors, RSM Bird Cameron Partners, to provide the
directors of the Company with an Independence Declaration in relation to the audit of the annual report. This
Independence Declaration is set out on page 22 and forms part of this directors’ report for the year ended 30 June
2009.
Signed in accordance with a resolution of Directors.
G Smith
Managing Director
Perth, 29 September 2009
Page 14
Lindian Resources Limited
Statement of Corporate Governance Practices
ASX Listing Rule 4.10.3 requires listed companies to disclose in their Annual Report the extent to which they have
complied with the ASX Best Practice Recommendations of the ASX Corporate Governance Council in the
reporting period. A description of the Company’s main corporate governance practices is set out below. All these
practices, unless otherwise stated, were in place for the entire year. They comply with the August 2007 ASX
Principles of Good Corporate Governance and Best Practice Recommendations.
The Company’s website at www.lindianresources.com.au contains a corporate governance section that includes
copies of the Company’s corporate governance policies.
Principle 1: Lay solid foundations for management and oversight
Role of the Board and of Senior Executives (1.1)
The relationship between the board and senior management is critical to the Company’s long-term success. The
directors are responsible to the shareholders for the performance of the Company in both the short and the longer
term and seek to balance sometimes competing objectives in the best interests of the Company as a whole. Their
focus is to enhance the interests of shareholders and other key stakeholders and to ensure the Company is properly
managed. Without intending to limit this general role of the Board, the principal functions and responsibilities of
the Board include the following:
• To set the strategic direction for the Company and monitor progress of those strategies;
• Establish policies appropriate for the Company;
• Monitor the performance of the Company, the Board and management;
• Approve the business plan and work programmes and budgets;
• Authorise and monitor investment and strategic commitments;
• Review and ratify systems for health, safety and environmental management; risk and internal control;
codes of conduct and regulatory compliance;
• Report to shareholders, including but not limited to, the Financial Statements of the Company; and
• Take responsibility for corporate governance.
Day to day management of the Company’s affairs and the implementation of the corporate strategy and policy
initiatives are formally delegated by the Board to the Managing Director and company secretary
This statement of matters reserved for the Board and areas of delegated authority to the Managing Director and
company secretary is contained in the Board Charter posted on the Company’s website.
Senior Executive Performance Review (1.2)
It is the policy of the Board to conduct an evaluation of the performance of senior executives annually.
Performance has been measured to date by the efficiency and effectiveness of the enhancement of the Company’s
mineral interest portfolio, the designing and implementation of the exploration and development programme,
maintenance of relationships with joint venture partners and the securing of ongoing funding so to continue it’s
exploration and development activities. This performance evaluation is not based on specific financial indicators
such as earnings or dividends as the Company is at the exploration and development stage and during this period is
expected to incur operating losses.
Due to the size of the Company and the nature of its business, it has not been deemed necessary to institute a
formal documented performance review program of senior executives. In March 2009, the Chairman conducted an
informal review process whereby he discussed with senior executives their attitude, performance and approach
toward meeting the short and long term objectives of the Company. The board considers that at this stage of the
Company’s development an informal process is appropriate.
This process for evaluating the Board and senior executives is contained in the Board Charter posted on the
Company’s website.
Page 15
Lindian Resources Limited
Statement of Corporate Governance Practices
Principle 2: Structure the board to add value
The Board operates in accordance with the broad principles set out in its charter which is available from the
corporate governance information section of the company website. The charter details the Board’s composition and
responsibilities.
Composition of the Board
To add value to the Company the Board has been formed so that it has effective composition, size and commitment
to adequately discharge its responsibilities and duties given its current size and scale of operations.
The names of Directors of the Company in office at the date of this statement are set out in the Directors’ Report.
Information regarding Directors’ experience and responsibilities is included in the Directors’ Report section of the
Annual Report.
The number of Directors is specified in the Constitution of the Company as a minimum of three up to a maximum
of ten.
The preferred skills and experiences for a Director of the Company include:
• Mineral Resources;
• Corporate and Business Development; and
• Public Company administration.
Independent Directors (2.1)
In assessing whether a director is classified as independent, the Board considers the independence criteria set out in
the ASX Corporate Governance Council Recommendation 2.1 and other facts, information and circumstances
deemed by the Board to be relevant.
Using the ASX Best Practice Recommendations on the assessment of the independence of Directors, the Board
considers that of a total of four Directors, two are considered to be independent (Mr Reg Gillard and Mr Anthony
Cunningham). Mr Greg Smith is the Managing Director of the Company and is not considered to be independent.
Mr Patrick Flint was employed in an executive role in 2007 and although meeting other criteria and bringing
independent judgement to bear in the role, is not considered to be independent. Mr Gillard and Mr Flint are
directors of and have a beneficial interest in a substantial shareholder of the Company, Corporate & Resource
Consultants Pty Ltd (“CRCPL”). There are a total of nine interest holders and directors of CRCPL. Mr Gillard and
Mr Flint do not control CRCPL nor do they represent the other interest holders and directors of CRCPL. Their
beneficial interests in shares held by CRCPL are included in the Directors Interests disclosed in the Directors
Report. Consequently the interests of Mr Gillard and Mr Flint in CRCPL are not considered to affect their
independent status.
The Company considers that each of the directors possess the skills and experience suitable for building the
Company and that the current composition of the Board is adequate for the Company's current size and operations."
Chairman and Chief Executive Officer (CEO) (2.2, 2.3)
The Board Charter requires that the Chairman of the Board will be a Non-Executive Director and will be elected by
the Directors. The Chairman is responsible for leading the Board, ensuring Directors are properly briefed in all
matters relevant to their role and responsibilities, facilitating Board discussions and managing Board’s relationship
with the Company’s senior executives. The Board considers that the Chairman, Mr Reg Gillard, is independent as
discussed in the above paragraph..
The CEO is Mr Greg Smith, Managing Director, who is responsible for implementing Company strategies and
policies.
Page 16
Lindian Resources Limited
Statement of Corporate Governance Practices
Nomination Committee (2.4)
The Board of Directors of the Company does not have a nomination committee. The Board is of the opinion that
due to the nature and size of the Company, the functions performed by a nomination committee can be adequately
handled by the full Board.
When a new director is to be appointed the Board reviews the range of skills, experience and expertise on the
board, identifies its needs and prepares a short-list of candidates with appropriate skills and experience. Where
necessary, advice is sought from independent search consultants.
The Board then appoints the most suitable candidate who must stand for election at the next annual general meeting
of the Company.
Retirement and rotation of Directors are governed by the Corporations Act 2001 and the Constitution of the
Company. Each year one third Directors must retire and offer themselves for re-election.
This selection, nomination and appointment process is detailed on the company website.
Board Performance Review (2.5)
It is the policy of the Board to conduct an evaluation of the performance of the Board annually. Performance is
measured by the efficiency and effectiveness of the designing and implementation of the exploration and
development programme, the enhancement of the Company’s mineral interest portfolio, the maintenance of
relationships with joint venture partners, the securing of required funding and the success of the Company’s
exploration and development activities. Performance evaluation is not based on specific financial indicators such as
earnings or dividends as the Company is at the exploration stage and during this period is expected to incur
operating losses.
Due to the size of the Board and the nature of its business, it has not been deemed necessary to institute a formal
documented performance review program of individuals. In March 2009, the Chairman conducted an informal
review process whereby he discussed with individual directors their attitude, performance and approach toward
meeting the short and long term objectives of the Company. The board considers that at this stage of the
Company’s development an informal process is appropriate.
Independent Professional Advice
Each Director has the right to seek independent professional advice at the Company’s expense after consultation
with the Chairman. Once received, the advice is to be made immediately available to all board members.
Access to Employees
Directors have the right of access to any employee. Any employee shall report any breach of corporate governance
principles or Company policies to the Executive Director and/or Company Secretary/Financial Controller who shall
remedy the breach. If the breach is not rectified to the satisfaction of the employee, they shall have the right to
report any breach to an independent Director without further reference to senior managers of the Company.
Share Ownership
Directors are encouraged to own Company shares.
Page 17
Lindian Resources Limited
Statement of Corporate Governance Practices
Board Meetings
The following points identify the frequency of Board Meetings and the extent of reporting from management at the
meetings:
• A minimum of four meetings are to be held per year;
• Other meetings will be held as required, meetings can be held by telephone link; and
•
Information provided to the Board includes all material information on: operations, budgets, cash flows,
funding requirements, shareholder movements, broker activity in the Company’s securities, assets and
liabilities, disposals, financial accounts, external audits, internal controls, risk assessment, new venture
proposals, and health, safety and environmental reports.
The number of Directors’ meetings and the number of meetings attended by each of the Directors of the Company
during the financial year are set out in the Directors’ Report.
Principle 3: Promote ethical and responsible decision making
Code of Conduct (3.1)
The Company has developed a Code of Conduct (the Code) which has been endorsed by the Board and applies to
all Directors and employees. The Code is regularly reviewed and updated as necessary to ensure it reflects the
practices necessary to maintain confidence in the Company’s integrity and to take into account legal obligations
and reasonable expectations of the Company’s stakeholders. The Code outlines the responsibility and
accountability of Company personnel to report and investigate reports of unethical practices.
This Code of Conduct can be found on the company website.
Trading Policy (3.2)
Trading in Company securities is regulated by the Corporations Act and the ASX Listing Rules. The Board makes
all Directors, officers and employees aware on appointment that it is prohibited to trade in the Company’s securities
whilst that Director, officer or employee is in the possession of price sensitive information.
For details of shares held by Directors and officers please refer to the Directors’ Report in these Financial
Statements. Directors are required to report to the Company Secretary any movements in their holdings of
Company securities, which are reported to ASX in the required timeframe prescribed by the ASX Listing Rules.
This Trading Policy can be found on the company website.
Whistleblower Policy
The Company requires employees who are aware of unethical practices within the Company or breaches of the
Company’s trading policy to report these using the Company’s Whistleblower Policy. This can be done
anonymously.
A copy of the Whistleblower Policy is available on the Company’s website.
Page 18
Lindian Resources Limited
Statement of Corporate Governance Practices
Principle 4: Safeguard Integrity in Financial reporting
Audit Committee (4.1, 4.2, 4.3)
The Company does not have an audit committee. The Board is of the opinion that due to the nature and size of the
Company, the functions performed by an audit committee can be adequately handled by the full Board.
External Auditors
The Company requires external auditors to demonstrate quality and independence. The performance of the external
auditor is reviewed and applications for tender of external audit services requested as deemed appropriate, taking
into consideration assessment of performance, existing value and tender costs.
RSM Bird Cameron Partners were appointed as external auditor in 2003. In accordance with the Corporations Act
RSM Bird Cameron Partners’ rotates audit engagement partners on listed companies at least every 5 years, and in
accordance with that policy a new audit engagement partner was introduced for the year ended 30 June 2008.
Principle 5 & 6: Making Timely and Balanced Disclosure and Shareholder Communication
Continuous Disclosure Policy and Shareholder Communication (5.1, 6.1)
The Company has developed a Continuous Disclosure Policy which has been endorsed by the Board. The
Continuous Disclosure Policy ensures compliance with ASX Listing Rules and Corporations Act obligations to
keep the market fully informed of information which may have a material effect on the price or value if its
securities and outlines accountability at a senior executive level for that compliance. All ASX announcements are
to be posted to the Company website as soon as possible after confirmation of receipt is received from ASX,
including all financial reports. The Company encourages effective participation at general meetings through a
policy of open disclosure to shareholders, regulatory authorities and the broader community of all material
information with respect to the Company’s affairs. All shareholders receive a copy of the Company’s annual (full
or concise) and half-yearly reports. All company announcements, media briefings, details of company meetings,
press releases and financial reports are available on the Company’s website.
The Continuous Disclosure Policy and Shareholder Communication Policy can be found on the Company website.
Principle 7: Recognise and Manage Risk
The Company is not currently of a size to require the formation of committees. The full Board has the
responsibility for the risk management, compliance and internal controls systems of the Company.
Risk Management (7.1, 7.2)
Management, through the Managing Director, is responsible for designing, implementing and reporting on the
adequacy of the Company’s risk management and internal control system. The Company’s risk management
policy is designed to provide the framework to identify, assess, monitor and manage the risks associated with the
Company’s business. The Company adopts practices designed to identify significant areas of business risk and to
effectively manage those risks in accordance with the Company’s risk profile. The risks involved in a resources
sector company and the specific uncertainties for the Company continue to be regularly monitored and the
Managing Director regularly appraises the full Board of the Company as to the effectiveness of the Company’s
management of its material business risks. All proposals reviewed by the Board include a consideration of the
issues and risks of the proposal. The potential exposures associated with running the Company have been managed
by the Directors and Company Secretary who have significant broad-ranging industry experience, work together as
a team and regularly share information on current activities.
Where necessary, the Board draws on the expertise of appropriate external consultants to assist in dealing with or
mitigating risk.
Page 19
Lindian Resources Limited
Statement of Corporate Governance Practices
The Company’s main areas of risk include:
exploration;
security of tenure;
environment;
•
• new project acquisitions;
•
•
• government policy changes and political risk;
• occupational health and safety;
•
•
financial reporting; and
continuous disclosure obligations.
Assurances from the Managing Director and the Company Secretary/Financial Controller (7.3)
It is the responsibility of the Board to regularly assess the adequacy of the Company’s risk management and
internal control systems and that its financial affairs comply with applicable laws and regulations and professional
practices.
Regular consideration is given to all these matters by the Board. The Company has in place an internal control
framework to assist the Board in identifying, assessing, monitoring and managing risk.
The Company’s internal control system is monitored by the Board and assessed regularly to ensure effectiveness
and relevance to the Company’s current and future operations. Procedures have been put into place to ensure the
Managing Director and the Company Secretary/Financial Controller state in writing to the Board that the integrity
of the financial statements is founded on a sound system of risk management and internal compliance and control
and that the Company’s risk management and internal compliance and control system is operating efficiently and
effectively.
The Managing Director and the Company Secretary have declared in writing to the Board that the Company’s
financial statements for the year ended 30 June 2009 present a true and fair view, in all material aspects, of the
Company’s financial condition and operational results and are in accordance with relevant accounting standards,
that this is founded on a sound system of risk management and internal compliance and control and that the
Company’s risk management and internal compliance and control system is operating efficiently and effectively.
This representation is made by the Managing Director and Company Secretary/Financial Controller prior to the
Director’s approval of the release of the annual and half yearly accounts. This representation is made after enquiry
of, and representation by, appropriate levels of management.
The policies on risk management can be found in the Board Charter on the Company website.
Principle 8: Remunerate Fairly and Responsibly
Remuneration Committee (8.1)
The Company does not have a remuneration committee. The Board is of the opinion that due to the nature and size
of the Company, the functions performed by a remuneration committee can be adequately handled by the full
Board.
Page 20
Lindian Resources Limited
Statement of Corporate Governance Practices
Remuneration Policy (8.2)
The Company’s policy for determining the nature and amount of emoluments of Board members is as follows:
• Remuneration of Executive and Non –Executive Directors is reviewed annually by the Board.
• Remuneration packages are set at levels intended to attract and retain Directors and Executives capable of
managing the Company’s operations and adding value to the Company.
Non-Executive Directors
Non-Executive Directors receive fees which are determined by the Board within the aggregate limit set by the
shareholders at a General Meeting. All Non-Executive Directors will receive remuneration by way of fees and
receive no retirement benefits excluding statutory superannuation, if applicable. External professional advice will
be sought to determine the level of Directors fees to ensure they are appropriate. The Board will determine the level
of fees with reference to other comparable listed companies determined by size and nature of operations. Directors’
fees should be set at a level to attract suitably qualified individuals to accept the responsibilities of a Directorship.
The issue of options to non-executive directors is considered an appropriate method of providing sufficient
incentive and reward whilst maintaining cash reserves.
Executives
The Executive Officers of the Company are the Managing Director and Company Secretary. The Executive
Officers’ remuneration is considered to properly reflect the person’s duties and responsibilities, and takes account
of remuneration levels across the sector.
Share and Option based remuneration
The Company may issue options to Executives as it is considered an appropriate method of providing sufficient
incentive and reward whilst maintaining cash reserves. Participants in equity-based remuneration plans are not
permitted to enter into any transactions that would limit the economic risk of options or other unvested
entitlements. Details of this policy can be found in the Remuneration Statement on the Company website.
For details of remuneration paid to Directors and officers for the financial year please refer to the Directors’ Report
in these Financial Statements.
Page 21
8 St Georges Terrace Perth WA 6000
GPO Box R1253 Perth WA 6844
T +61 8 9261 9100 F +61 8 9261 9111
www.rsmi.com.au
AUDITOR INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of Lindian Resources Limited for the year ended 30 June
2009, I declare that, to the best of my knowledge and belief, there have been no contraventions of:
(i)
(ii)
the auditor independence requirements as set out in the Corporations Act 2001 in relation to the
audit; and
any applicable code of professional conduct in relation to the audit.
RSM BIRD CAMERON PARTNERS
Chartered Accountants
Perth, WA
Dated: 29 September 2009
T 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 an
independent member firm of RSM
International, an affiliation of independent
accounting and consulting firms.
Lindian Resources Limited
Income Statements
For the Year ended 30 June 2009
Revenue
Finance revenue
Other revenue
Total revenue
Expenses
Administration expense
Depreciation expense
Employee benefits expense
Exploration expenditure written off
Occupancy expense
Impairment loss
Foreign exchange loss
Total expenses
Loss before income tax
Consolidated
Company
Notes
2009
$
2008
$
2009
$
2008
$
2
2
3
3
3
82,415
15,493
97,908
(211,018)
(26,454)
(333,294)
(740,982)
(2,934)
-
-
183,889
-
183,889
(366,615)
(25,043)
(412,829)
(71,503)
(4,371)
-
-
82,415
62,991
145,406
(197,773)
(26,454)
(333,294)
(210,978)
(2,934)
(530,004)
-
(1,314,682)
(880,361)
(1,301,437)
183,889
-
183,889
(355,409)
(25,043)
(412,829)
(71,503)
(4,371)
-
(14,677)
(883,832)
(1,216,774)
(696,472)
(1,156,031)
(699,943)
Income tax (expense)/benefit
5
-
-
-
-
Net loss
(1,216,774)
(696,472)
(1,156,031)
(699,943)
Loss is attributable to :
Lindian Resources Limited
(1,189,687)
(694,222)
(1,156,031)
(699,943)
Minority Interest
16
(27,087)
(2,250)
-
-
(1,216,774)
(696,472)
(1,156,031)
(699,943)
Basic and diluted earnings/(loss) per share
6
(3.14) cents
(2.10) cents
The above income statements should be read in conjunction with the accompanying notes.
Page 23
Lindian Resources Limited
Balance Sheets
As at 30 June 2009
Current Assets
Cash and cash equivalents
Receivables
Total Current Assets
Consolidated
Company
Notes
2009
$
2008
$
2009
$
2008
$
8
9
1,514,160
11,514
2,428,436
11,794
1,513,904
11,485
2,425,580
11,774
1,525,674
2,440,230
1,525,389
2,437,354
Non-Current Assets
Receivables
Other financial assets
Plant and equipment
Mineral interest acquisition, exploration and
development expenditure
9
10
11
12
-
99,404
10,737
-
83,203
55,259
796,799
56,290
10,737
305,309
586,294
55,259
798,365
875,703
-
51,610
Total Non-Current Assets
908,506
1,014,165
863,826
998,472
Total Assets
2,434,180
3,454,395
2,389,215
3,435,826
Current Liabilities
Trade and other payables
Total Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Option premium reserve
Foreign currency translation reserve
Accumulated losses
Capital and Reserves attributable to equity
holders of Lindian Resources Limited
Minority interest
Total Equity
13
154,205
154,205
41,098
41,098
153,957
153,957
41,098
41,098
154,205
41,098
153,957
41,098
2,279,975
3,413,297
2,235,258
3,394,728
14
15
12,059,878
1,130,200
57,781
(10,983,167)
12,063,317
1,130,200
(29,110)
(9,793,480)
12,059,878
1,130,200
-
(10,954,820)
12,063,317
1,130,200
-
(9,798,789)
2,264,692
3,370,927
2,235,258
3,394,728
16
15,283
42,370
-
-
2,279,975
3,413,297
2,235,258
3,394,728
The above balance sheets should be read in conjunction with the accompanying notes.
Page 24
Lindian Resources Limited
Statements of Changes in Equity
For the year ended 30 June 2009
Consolidated
Issued
Capital
Accumulated
Losses
Option
Premium
Reserve
Foreign
Currency
Translation
Reserve
Minority
Equity
Interest
Total Equity
$
$
$
$
$
$
Balance at 1 July 2007
11,526,830
(9,099,258)
1,024,650
Shares issued during the year
536,487
Currency translation differences
Loss attributable to members of
the parent entity
Fair value of options issued
-
-
-
-
-
(694,222)
-
-
-
-
105,550
-
-
-
3,452,222
44,620
581,107
(29,110)
-
(29,110)
-
-
(2,250)
(696,472)
-
105,550
Balance at 30 June 2008
12,063,317
(9,793,480)
1,130,200
(29,110)
42,370
3,413,297
Balance at 1 July 2008
Share issue expenses during the
year
Currency translation differences
Loss attributable to members of
the parent entity
12,063,317
(9,793,480)
1,130,200
(29,110)
42,370
3,413,297
(3,439)
-
-
-
-
(1,189,687)
-
-
-
-
86,891
-
-
(3,439)
86,891
-
(27,087)
(1,216,774)
Balance at 30 June 2009
12,059,878
(10,983,167)
1,130,200
57,781
15,283
2,279,975
The above statements in changes in equity should be read in conjunction with the accompanying notes.
Page 25
Lindian Resources Limited
Statements of Changes in Equity
For the year ended 30 June 2009
Company
Issued Capital
Accumulated
Losses
Option
Premium
Reserve
Total Equity
$
$
$
$
Balance at 1 July 2007
11,526,830
(9,098,846)
1,024,650
3,452,634
Shares issued during the year
Loss attributable to members of the
parent entity
Fair value of options issued
536,487
-
(699,943)
-
-
-
-
536,487
(699,943)
-
105,550
105,550
Balance at 30 June 2008
12,063,317
(9,798,789)
1,130,200
3,394,728
Balance at 1 July 2008
12,063,317
(9,798,789)
1,130,200
3,394,728
Share issue expenses during the year
Loss attributable to members of the
parent entity
(3,439)
-
-
(1,156,031)
-
-
(3,439)
(1,156,031)
Balance at 30 June 2009
12,059,878
(10,954,820)
1,130,200
2,235,258
The above statements in changes in equity should be read in conjunction with the accompanying notes.
Page 26
Lindian Resources Limited
Cash Flow Statement
For the year ended 30 June 2009
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
Cash Flows from Operating Activities
Cash payments in the course of operations
Interest received
(559,766)
82,415
(689,917)
183,889
(545,626)
82,415
(678,589)
183,889
Net Cash used in Operating Activities
21 (a)
(477,351)
(506,028)
(463,211)
(494,700)
Cash Flows from Investing Activities
Payments for exploration and development expenditure
Payments for property, plant and equipment
Proceeds on disposal of property, plant and equipment
Payments for purchase of subsidiary
Advances to controlled entities
Security deposit
(468,477)
-
31,086
-
-
-
(389,598)
(67,494)
-
-
-
(83,203)
(195,945)
-
31,086
-
(284,072)
-
(122,864)
(67,494)
-
(44,444)
(319,616)
-
Net Cash used in Investing Activities
(437,391)
(540,295)
(448,931)
(554,418)
Cash Flows from Financing Activities
Proceeds from exercise of options
Share issue expenses
Net cash provided by / (used in) financing activities
-
(2,008)
(2,008)
11,487
-
11,487
-
(2,008)
(2,008)
11,487
-
11,487
Net Decrease in Cash Held
Cash and cash equivalents at the beginning of the financial
year
Effect of foreign exchange on cash
(916,750)
(1,034,836)
(914,150)
(1,037,631)
2,428,436
3,463,272
2,425,580
3,463,211
2,474
-
2,474
-
Cash and cash equivalents at the end of the Financial
Year
8
1,514,160
2,428,436
1,513,904
2,425,580
The above cash flow statements should be read in conjunction with the accompanying notes
Page 27
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This financial report includes the consolidated financial statements and notes of Lindian Resources Limited and
controlled entities (‘Consolidated Group’ or ‘Group’), and the separate financial statements and notes of Lindian
Resources Limited as an individual parent entity (‘Parent Entity’ or ‘Company’).
Basis of Preparation
The financial report is a general purpose financial report that has been prepared in accordance with Australian
Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian
Accounting Standards Board and the Corporations Act 2001.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a
financial report containing relevant and reliable information about transactions, events and conditions. Compliance
with Australian Accounting Standards ensures that the financial statements and notes also comply with
International Financial Reporting Standards. Material accounting policies adopted in the preparation of this
financial report are presented below and have been consistently applied unless otherwise stated.
The financial report has been prepared on an accruals basis and is based on historical costs, modified, where
applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.
The financial report is presented in Australian dollars and was authorised for issue on 29 September 2009. The
company is a listed public company, incorporated in Australia and operating in Australia and Africa.
Basis of Consolidation
A controlled entity is any entity over which Lindian Resources Limited has the power to govern the financial and
operating policies so as to obtain benefits from its activities. In assessing the power to govern, the existence and
effect of holdings of actual and potential voting rights are considered.
A list of controlled entities is contained in Note 10 to the financial statements.
As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated
financial statements as well as their results for the year then ended. Where controlled entities have entered (left)
the consolidated group during the year, their operating results have been included (excluded) from the date control
was obtained (ceased).
All inter-group balances and transactions between entities in the consolidated group, including any unrealised
profits or losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed
where necessary to ensure consistency with those adopted by the parent entity.
Minority interests, being that portion of the profit or loss and net assets of subsidiaries attributable to equity
interests held by persons outside the Group, are shown separately within the Equity section of the consolidated
Balance Sheet and in the consolidated Income Statement.
Significant accounting judgments, estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of
future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the
carrying amounts of certain assets and liabilities within the next annual reporting period are:
Page 28
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – continued
Significant accounting judgments, estimates and assumptions - continued
Exploration and evaluation expenditure
The Board of Directors determines when an area of interest should be abandoned. When a decision is made that an
area of interest is not commercially viable, all costs that have been capitalised in respect of that area of interest are
written off. The Directors’ decision is made after considering the likelihood of finding commercially viable
reserves.
Share-based payment transactions:
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the
equity instruments at the date at which they are granted. The fair value is determined by using a Black and Scholes
model.
Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the
revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is
recognised:
Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the
financial asset.
Cash and cash equivalents
Cash and short-term deposits in the balance sheet comprise cash at bank and in hand and short term deposits with
an original maturity of three months or less.
For the purposes of the Cash Flow Statement, cash and cash equivalents consist of cash and cash equivalents as
defined above, net of outstanding bank overdrafts.
Trade and other receivables
Trade receivables, which generally have 30 day terms, are recognised and carried at original invoice amount less an
allowance for any uncollectible amounts. An allowance for doubtful debts is made when there is objective evidence
that the Group will not be able to collect the debts. Bad debts are written off when identified.
Foreign currency transactions and balances
The functional and presentation currency of the Company is Australian dollars.
Transactions in foreign currencies are initially recorded in the functional currency at the exchange rates ruling at
the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the
rate of exchange ruling at the balance sheet date.
All differences in the consolidated financial report are taken to the income statement.
The functional currencies of the overseas subsidiary is as follows:
Africa
United States Dollar (USD)
As at the reporting date, the assets and liabilities of these overseas subsidiaries are translated into the presentation
currency of the Company at the rate of exchange ruling at the balance sheet date and the income statements are
translated at the weighted average exchange rates for the period.
Page 29
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – continued
Foreign currency transactions and balances - continued
The exchange differences on the retranslation are taken directly to a separate component of equity.
On disposal of a foreign entity, the deferred cumulative amount recognised in equity is recognised in the income
statement.
Taxes
Income tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be
recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those
that are enacted or substantively enacted by the balance sheet date.
Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of
assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
• when the deferred income tax liability arises from the initial recognition of goodwill or of an asset or
liability in a transaction that is not a business combination and that, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss; or
• when the taxable temporary difference is associated with investments in subsidiaries, associates or interests
in joint ventures, and the timing of the reversal of the temporary difference can be controlled and it is
probable that the temporary difference will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax
assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the
deductible temporary differences and the carry-forward of unused tax credits and unused tax losses can be
utilised, except:
• when the deferred income tax asset relating to the deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss; or
• when the deductible temporary difference is associated with investments in subsidiaries, associates or
interests in joint ventures, in which case a deferred tax asset is only recognised to the extent that it is
probable that the temporary difference will reverse in the foreseeable future and taxable profit will be
available against which the temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the
extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the
deferred income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each balance sheet date and are recognised to the extent
that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the balance sheet date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current
tax assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity
and the same taxation authority.
Page 30
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – continued
Taxes - continued
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST except:
•
•
when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in
which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item
as applicable; and
receivables and payables, which are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or
payables in the balance sheet.
Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing
and financing activities, which are disclosed as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the
taxation authority.
Property, Plant and Equipment
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses.
Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows:
Computer hardware – 33%
Field Equipment – 33%
Motor Vehicles – 33%
The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each
financial year end.
(i) Impairment
The carrying values of plant and equipment are reviewed for impairment at each reporting date, with recoverable
amount being estimated when events or changes in circumstances indicate that the carrying value may be impaired.
The recoverable amount of plant and equipment is the higher of fair value less costs to sell and value in use. In
assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset.
For an asset that does not generate largely independent cash inflows, recoverable amount is determined for the
cash-generating unit to which the asset belongs, unless the asset's value in use can be estimated to be close to its
fair value.
An impairment exists when the carrying value of an asset or cash-generating units exceeds its estimated
recoverable amount. The asset or cash-generating unit is then written down to its recoverable amount.
Page 31
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – continued
Mineral interest acquisition, exploration and development expenditure
Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an
exploration and evaluation asset in the year in which they are incurred where the following conditions are satisfied:
(i)
(ii)
the rights to tenure of the area of interest are current; and
at least one of the following conditions is also met:
(a)
(b)
the exploration and evaluation expenditures are expected to be recouped through
successful development and exploration of the area of interest, or alternatively, by its
sale; or
exploration and evaluation activities in the area of interest have not at the reporting date
reached a stage which permits a reasonable assessment of the existence or otherwise of
economically recoverable reserves, and active and significant operations in, or in
relation to, the area of interest are continuing.
Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, studies,
exploratory drilling, trenching and sampling and associated activities and an allocation of depreciation and
amortisation of assets used in exploration and evaluation activities. General and administrative costs are only
included in the measurement of exploration and evaluation costs where they are related directly to operational
activities in a particular area of interest.
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the
carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The recoverable
amount of the exploration and evaluation asset (for the cash generating unit(s) to which it has been allocated being
no larger than the relevant area of interest) is estimated to determine the extent of the impairment loss (if any).
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised
estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the
carrying amount that would have been determined had no impairment loss been recognised for the asset in previous
years.
Where a decision has been made to proceed with development in respect of a particular area of interest, the relevant
exploration and evaluation asset is tested for impairment and the balance is then reclassified to development.
Impairment testing
The carrying amount of the consolidated entity assets, other than deferred tax assets, are reviewed at each reporting
date to determine whether there is any indication of impairment. Where such an indication exists, a formal
assessment of recoverable amount is then made and where this is in excess of carrying amount, the asset is written
down to its recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. Value in use is the present value
of the future cash flows expected to be derived from the asset or cash generating unit. In estimating value in use, a
pre-tax discount rate is used which reflects current market assessments of the time value of money and the risks
specific to the asset. Any resulting impairment loss is recognised immediately in the income statement.
Page 32
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – continued
Impairment testing - continued
Impairment losses are reversed when there is an indication that the impairment loss may no longer exist and there
has been a change in the estimate used to determine the recoverable amount. An impairment loss is reversed only to
the extent that the assets’ carrying amount does not exceed the carrying amount that would have been determined,
net of depreciation or amortisation, if no impairment loss had been recognised.
Payables
Trade payables and other payables are carried at amortised costs and represent liabilities for goods and services
provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes
obliged to make future payments in respect of the purchase of these goods and services.
Provisions
Provisions are recognised when the consolidated entity has a present obligation (legal or constructive) as a result of
a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation and a reliable estimate can be made of the amount of the obligation.
Employee Benefits
Wages, salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within
12 months of the reporting date are recognised in other payables in respect of employees’ services up to the
reporting date. They are measured at the amounts expected to be paid when the liabilities are settled.
Contributions are made by the consolidated entity to superannuation funds as stipulated by statutory requirements
and are charged as expenses when incurred.
Share-based payment transactions
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the
period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant
employees become fully entitled to the award (the vesting period).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects
(i) the extent to which the vesting period has expired and (ii) the Company’s best estimate of the number of equity
instruments that will ultimately vest. No adjustment is made for the likelihood of market performance conditions
being met as the effect of these conditions is included in the determination of fair value at grant date. The income
statement charge or credit for a period represents the movement in cumulative expense recognised as at the
beginning and end of that period.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is only
conditional upon a market condition.
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not
been modified. In addition, an expense is recognised for any modification that increases the total fair value of the
share-based payment arrangement, or is otherwise beneficial to the employee, as measured at the date of
modification.
Page 33
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – continued
Share-based payment transactions - continued
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense
not yet recognised for the award is recognised immediately. However, if a new award is substituted for the
cancelled award and designated as a replacement award on the date that it is granted, the cancelled and new award
are treated as if they were a modification of the original award, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of
earnings per share.
Issued Capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options
are shown in equity as a deduction, net of tax, from the proceeds.
Earnings per Share
Basic earnings per share is calculated as net profit attributable to members of the parent, adjusted to exclude any
costs of servicing equity (other than dividends) and preference share dividends, divided by the weighted average
number of ordinary shares, adjusted for any bonus element.
Diluted earnings per share is calculated as net profit attributable to members of the parent, adjusted for:
•
•
•
costs of servicing equity (other than dividends) and preference share dividends;
the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been
recognised as expenses; and
other non-discretionary changes in revenues or expenses during the period that would result from the dilution
of potential ordinary shares; divided by the weighted average number of ordinary shares and dilutive
potential ordinary shares, adjusted for any bonus element.
Segment Reporting
Segment revenues and expenses are those directly attributable to the segments and include any joint revenue and
expenses where a reasonable basis of allocation exists.
Segment assets include all assets used by a segment and consist principally of cash, receivables, property, plant and
equipment net of accumulated depreciation and mineral interest acquisitions, exploration and development
expenditure. Whilst most such assets can be directly attributed to individual segments, the carrying amount of
certain assets used jointly by two or more segments is allocated to the segments on a reasonable basis. Segment
liabilities consist principally of accounts payable, employee entitlements, accrued expenses, provisions and
borrowings. Segment assets and liabilities do not include deferred income taxes.
Where segment revenues and expenses include transfers between segments, these are at the same rates which would
apply to parties outside the consolidated entity on an arm’s length basis. These transfers are eliminated on
consolidation.
Page 34
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – continued
Adoption of new and revised standards
Changes in accounting policies on initial application of Accounting Standards
In the year ended 30 June 2009, 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.
Critical judgements
The board of directors determines when an area of interest should be abandoned. When a decision is made that an
area of interest is not commercially viable, all costs that have been capitalised in respect of that area of interest are
written off. The Directors’ decision is made after considering the likelihood of finding commercially viable
reserves.
Although no areas of interest have been abandoned at the date of this report, the directors have impaired
exploration expenditure by $530,004 on the Bafwasende project, after consideration of the exploration results to
date, the global financial situation and the political risk associated with operating in Democratic Republic of
Congo.
Page 35
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
2. REVENUE
Finance Revenue
Foreign exchange gain
Gain on sale of assets
3. EXPENSES
Loss before income tax has been determined after:
Expenses
Depreciation of plant and equipment
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
82,415
183,889
82,415
183,889
2,475
13,018
15,493
-
-
-
49,973
13,018
62,991
-
-
-
26,454
25,043
26,454
25,043
Impairment of investment in subsidiary
-
-
530,004
-
Exploration expenditure written off
740,982
71,503
210,978
71,503
Employee benefits expense
Director salaries, fees and superannuation
Share based payments expense
Employee salaries, fees and superannuation
4. AUDITORS’ REMUNERATION
Amounts received or due and receivable by RSM Bird
Cameron Partners for:
- An audit or review of the financial report of the entity
and any other entity in the consolidated group
- Other services
209,059
-
124,235
333,294
166,108
88,700
158,021
412,829
209,059
-
124,235
333,294
166,108
88,700
158,021
412,829
18,000
-
18,000
17,000
-
17,000
18,000
-
18,000
17,000
-
17,000
Page 36
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
5.
INCOME TAX EXPENSE
(a) The prima facie tax benefit at 30% on loss is
reconciled to the income tax provided in the
financial statements as follows:
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
Loss
Prima facie income tax benefit @ 30%
Non-deductible (Other deductible) expenses
Deferred tax asset not brought to account
(1,216,774)
(365,032)
127,074
237,958
(696,472)
(208,942)
(4,986)
213,928
(1,156,031)
(346,809)
112,825
233,984
(699,943)
(209,983)
(4,986)
214,969
Income tax benefit reported in the consolidated
income statement
-
-
-
-
-
3,439
3,439
-
-
-
3,439
3,439
Income tax recognised directly in equity
The following current and deferred amounts were charged
directly to equity during the period:
Current tax:
Share-issue expenses
(b) The potential deferred tax asset arising from tax
losses and temporary differences have not been
recognised as an asset because recovery of tax losses
is not yet considered sufficiently probable.
Australian tax losses
2,579,347
2,376,940
2,579,347
2,376,940
The Group has tax losses arising in Australia of $8,597,822 (2008: $7,923,133) that are available for offset against future
taxable profits of the companies in which the losses arose.
The potential deferred tax asset will only be obtained if:
(a) the relevant Company derives future assessable income of a nature and an amount sufficient to enable the benefit to be
realised,
b) the relevant Company continues to comply with the conditions for deductibility imposed by the Law including the
continuity of ownership and same business tests; and
(c) no changes in tax legislation adversely affect the relevant Company and/or consolidated entity in realising the benefit.
Page 37
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
6. EARNINGS PER SHARE
Basic earnings per share amounts are calculated by dividing net profit/(loss) for the year attributable to
ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during
the year.
Basic earnings/(loss) per share
Diluted earnings/(loss) per share
The net loss and weighted average number of ordinary shares
used in the calculation of basic earnings per share is as follows:
Net loss
Weighted average number of ordinary shares used in the
calculation of basic earnings per share
Consolidated
2009
cents
(3.14)
(3.14)
2008
cents
(2.10)
(2.10)
2009
$
(1,189,687)
2008
$
(694,222)
2009
Number
2008
Number
37,828,022
33,060,497
The Company’s potential ordinary shares, being its options granted, are not considered dilutive as the conversion of these
options would result in a decrease in the net loss per share.
Page 38
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
7. SEGMENT INFORMATION
Business segments (Primary Segment)
Revenue
Operating revenue
Other external revenue
Total segment revenue
Results
Operating loss before income tax
Income tax expense
Net loss
Non-Cash Expenses
Depreciation
Non-cash expenses other than depreciation
Assets
Segment assets
Non-current assets acquired
Liabilities
Segment liabilities
Business segments (Secondary Segment)
Mineral
Exploration
2009
$
Mineral
Exploration
2008
$
Consolidated
Consolidated
2009
$
2008
$
-
97,908
97,908
-
183,889
183,889
-
97,908
97,908
1,216,774
696,472
1,216,774
-
1,216,774
26,454
-
2,434,180
555,492
25,043
88,700
26,454
-
3,454,395
1,004,174
2,434,180
555,492
3,454,395
1,004,174
-
183,889
183,889
696,472
-
696,472
25,043
88,700
154,205
41,098
154,205
41,098
Australia
2009
$
Australia
2008
$
Africa
2009
$
Africa
2008
$
Consolidated
2009
$
Consolidated
2008
$
Segment revenue
Segment assets
97,908
183,889
-
-
97,908
183,889
1,536,125
2,849,060
898,055
605,335
2,434,180
3,454,395
Page 39
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
8. CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short term deposits
- Cash at bank earns interest at floating rates based on
daily bank deposit rates.
in money market
(i) Reconciliation to Cash Flow Statement:
For the purposes of the cash flow statement, cash and cash
equivalents comprise cash on hand and at bank and
instruments, net of
investments
outstanding bank overdrafts.
Cash and cash equivalents as shown in the cash flow
statement is reconciled to the related items in the balance
sheet as follows:
Cash and cash equivalents
9. RECEIVABLES
Current
Trade and other receivables
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
43,108
124,111
42,852
121,255
1,471,052
2,304,325
1,471,052
2,304,325
1,514,160
2,428,436
1,513,904
2,425,580
1,514,160
2,428,436
1,513,904
2,425,580
11,514
11,794
11,485
11,774
Trade and other receivables are non-interest bearing and
are generally on 30 day terms. An allowance for doubtful
debts is made when there is objective evidence that a trade
receivable
the
allowance/impairment loss has been measured as the
difference between the carrying amount of the trade
receivables and the estimated future cash flows expected to
be received from the relevant debtors.
impaired. The
amount
of
is
Non-current
Loan to controlled entities
Loans have been made to subsidiaries. The loans are interest
free, unsecured and repayable only when the borrower’s cash
flow permits.
-
-
796,799
305,309
Page 40
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
10. OTHER FINANCIAL ASSETS (Non-Current)
Investment in subsidiaries – unlisted shares at cost
(refer 10 (a))
Impairment against investment in subsidiary
Security deposits
(a) Particulars in relation to subsidiaries
Name of subsidiary
Parent Entity
Lindian Resources Limited
Subsidiaries
(i) Lindian Resources Guinea Pty Ltd (previously
Virtualplus Australia Pty Ltd)
-
-
-
99,404
99,404
-
-
586,294
(530,004)
-
83,203
83,203
56,290
-
56,290
586,294
-
-
-
586,294
Notes
Place of
Incorporation
Consolidated
Entity Interest
2009
%
Consolidated
Entity Interest
2008
%
Australia
Australia
100
100
(ii) Congolese Exploration Company Sprl (“Coexco”)
(refer Note 21(b))
Democratic
Republic of Congo
80
80
.
Page 41
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
11. PLANT AND EQUIPMENT
Plant and equipment - at cost
Accumulated depreciation
Total plant and equipment net book value
Reconciliation:
Balance at the beginning of the year
Additions
Disposals
Depreciation
Carrying amount at the end of the year
12. MINERAL INTEREST ACQUISITION,
EXPLORATION AND DEVELOPMENT
EXPENDITURE
Balance at the beginning of the year
Purchase price for mineral interests
Expenditure incurred during the period
Costs written-off
Translation difference movement
Carried forward
The expenditure above relates principally to the exploration
and evaluation phase. The ultimate recoupment of this
expenditure is dependent upon the successful development
and commercial exploitation, or alternatively, sale of the
respective areas of interest, at amounts at least equal to
book value.
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
29,700
(18,963)
10,737
81,491
(26,232)
29,700
(18,963)
81,491
(26,232)
55,259
10,737
55,259
55,259
-
(18,068)
(26,454)
10,737
12,807
67,495
-
(25,043)
55,259
-
(18,068)
(26,454)
12,807
67,495
-
(25,043)
55,259
10,737
55,259
875,703
-
592,068
(740,982)
71,576
120,250
586,294
350,385
(151,024)
(30,202)
51,610
-
159,368
(210,978)
-
120,250
-
82,384
(151,024)
-
798,365
875,703
-
51,610
Page 42
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
13. TRADE AND OTHER PAYABLES
Current
Trade creditors
Accrued expenses
Terms and conditions relating to the above financial
instruments:
- Trade and other creditors are non-interest bearing
and are normally settled on 30 day terms.
14. ISSUED CAPITAL
(a) Issued and paid-up share capital
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
13,557
140,648
154,205
8,680
32,418
41,098
13,309
140,648
153,957
8,680
32,418
41,098
37,878,022 (2008: 37,878,022) ordinary shares, fully paid
12,059,878 12,063,317 12,059,878 12,063,317
Fully paid ordinary shares carry one vote per share and
carry the right to dividends.
Movements in Ordinary Shares:
Balance at the beginning of the year
Issue of shares for acquisition of 80% of the share capital in
Coexco Sprl (i)
Options converted to shares during year
Transaction costs on share issue
Balance at the end of the year
Number
Number
$
$
37,828,022 32,771,397
12,063,317 11,526,830
-
-
-
5,000,000
56,625
-
-
-
(3,439)
525,000
11,487
-
37,828,022 37,828,022 12,059,878 12,063,317
(i) Shares were issued in the prior year at a deemed price of 10.5 cents for the acquisition of 80% of the share capital of
Coexco Sprl, and the right to acquire the remaining 20%.
Page 43
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
14. ISSUED CAPITAL – continued
(b) Share Options
Options to subscribe for ordinary shares in the Company have been granted as follows:
Exercise
Period
Exercise
Price
Note
Opening
Balance
1 July 2008
Options
Issued
2008/09
Options
Exercised/
Cancelled/
Expired
2008/09
Closing
Balance
30 June 2009
On or before 31 December 2010
On or before 1 July 2011
On or before 15 September 2009
On or before 31 December 2009
On or before 30 September 2010
On or before 30 September 2010
On or before 31 December 2011
Number
Number
Number
$0.20
$0.20
$0.30
$0.30
$0.30
$0.35
$0.30
495,000
1,000,000
3,000,000
17,381,879
200,000
350,000
500,000
22,926,879
-
-
-
-
-
-
-
-
Number
495,000
1,000,000
3,000,000
17,381,879
200,000
350,000
500,000
22,926,879
-
-
-
-
-
-
-
-
(c)
Terms and conditions of contributed equity
Ordinary Shares:
Ordinary shares have the right to receive dividends as declared and, in the event of winding up of the Company, to participate
in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held.
Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
Page 44
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
15. RESERVES
Nature and purpose of reserves
Option Premium Reserve
The option premium reserve is used to record the fair value of options issued but not exercised.
Foreign Currency Translation Reserve
The foreign currency translation reserve comprises all foreign exchange differences arising from the translation of the
financial statements of foreign operations where their functional currency is different to the presentation currency of the
reporting entity.
16. MINORITY INTEREST
Interest in:
Share capital
Accumulated losses
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
42,370
(27,087)
15,283
44,620
(2,250)
42,370
-
-
-
-
-
-
Page 45
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
17. SHARE-BASED PAYMENTS
The Company makes share based payments to consultants and / or service providers from time to time, not under any specific
plan. The Company also may issue options to directors of the parent entity. Specific shareholder approval is obtained for any
share based payments to directors of the parent entity.
The expense recognised in the income statement in relation to share-based payments is disclosed in Note 3.
The following table illustrates the number and weighted average exercise prices of and movements in share options issued
during the year:
Outstanding at the beginning of the year
6,545,000
2009
Number of
options
Granted during the year
Forfeited during the year
Exercised during the year
Expired during the year
-
-
-
-
2009 Weighted
average
exercise price
28 cents
-
-
-
-
Outstanding at the end of the year
Exercisable at the end of the year
6,545,000
6,545,000
28 cents
2008
Number of
options
5,550,000
1,050,000
-
2008 Weighted
average
exercise price
27 cents
33 cents
-
(55,000)
20 cents
-
6,545,000
6,545,000
-
28 cents
The fair value of the equity-settled share options is estimated as at the date of grant using a Black and Scholes model taking
into account the terms and conditions upon which the options were granted. The fair value of shares issued is calculated by
reference to the market value of the shares trading on the Australian Securities Exchange on or around the date of grant.
The following table lists the inputs to the model used for the years ended 30 June 2009 and 30 June 2008:
Volatility (%) – range
Risk-free interest rate (%) – range
Expected life of option (years)
Exercise price (cents)
Weighted average share price at grant date (cents)
2009
2008
70%
6.75%
2 to 3 years
20-30
10.5
-
-
-
-
-
The expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that may occur.
The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may also not
necessarily be the actual outcome. No other features of options granted were incorporated into the measurement of fair value.
Page 46
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
18. FINANCIAL INSTRUMENTS
Overview
The Company and Group have exposure to the following risks from their use of financial instruments:
- credit risk
- liquidity risk
- market risk
This note presents information about the Company’s and 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.
Cash and cash equivalents
Trade and other receivables
Other financial assets
Total Financial Assets
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
8
9
10
1,514,160
11,514
99,404
2,428,436
11,794
83,203
1,513,904
808,284
-
2,425,580
316,611
-
1,625,078
2,523,433
2,322,188
2,742,191
Total Financial Liabilities
13
154,205
41,098
153,957
41,098
(a)
Credit Risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from the Group’s receivables from customers and investment securities. For the
Company it arises from receivables due from subsidiaries.
(i) Receivables
As the Group operates in the mineral exploration sector, it does not have trade receivables and therefore is not exposed to
credit risk in relation to trade receivables.
The Company and Group have established an allowance for impairment that represents their estimate of incurred losses in
respect of other receivables and investments. The main components of this allowance are a specific loss component that relates
to individually significant exposures. The management does not expect any counterparty to fail to meet its obligations.
Exposure to credit risk
The carrying amount of the Group’s financial assets represents the maximum credit exposure.
Page 47
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
18. FINANCIAL INSTRUMENTS - continued
(b)
Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach
to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due,
under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.
The Group manages liquidity risk by maintaining adequate reserves and by continuously monitoring forecast and actual cash
flows.
Due to the nature of the Group’s activities and the present lack of operating revenue, the Company has to raise additional
capital from time to time in order to fund its exploration activities. The decision on how and when the Company will raise
future capital will depend on market conditions existing at that time and the level of forecast activity and expenditure.
Typically, the Group ensures that it has sufficient cash on demand to meet expected operational expenses for a period of
between six and twelve months, including the servicing of financial obligations; this excludes the potential impact of extreme
circumstances that cannot reasonably be predicted, such as natural disasters.
(c)
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. The objective of market risk management is to
manage and control market risk exposures within acceptable parameters, while optimising the return.
(i) Currency risk
The consolidated entity is exposed to foreign exchange rate arising from various currency exposures, primarily with respect to
the US dollar.
Foreign exchange risk arises from future commercial transactions and recognized assets and liabilities denominated in a
currency that is not the company’s functional currency. The risk is measured using sensitivity analysis.
The following significant exchange rates applied during the year:
Notes
Average rate
Reporting date spot rate
2009
$
2008
$
2009
$
2008
$
United States Dollar
0.75
0.89
0.80
0.96
The consolidated entity’s exposure to foreign currency risk at the reporting date was as follows:
Functional currency of group entity
Notes Consolidated Company Consolidated Company
United States Dollar
$
475,546
$
374,066
$
538,595
$
304,836
Net Financial Assets/(Liabilities) in AUD
30 June 2008
30 June 2009
Page 48
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
18. FINANCIAL INSTRUMENTS - continued
Foreign currency risk sensitivity analysis
At 30 June, the effect on loss and equity as a result of changes in the value of the Australian Dollar to the foreign currencies,
with all other variables remaining constant is as follows:
Year ended 30 June 2009
+/-10% in $A/$US
Year ended 30 June 2008
+/-10% in $A/$US
(ii) Interest Risk
Consolidated
Profit
$
Equity
$
Company
Profit
$
Equity
$
-
-
11,263
45,269
34,006
-
27,712
27,712
The Group’s exposure to the risk of changes in market interest rate relates primarily to the Group’s cash and cash equivalents.
The Group and Company did not have any fixed rate instruments at balance date.
At the reporting date the interest rate profile of the Company’s and the Group’s interest-bearing financial instruments:
Variable rate Instruments at call
Financial assets
Financial liabilities
Consolidated
Carrying Amount
2009
$
2008
$
Company
Carrying Amount
2008
$
2009
$
1,514,160
-
1,514,160
2,428,436
-
2,428,436
1,513,904
-
1,513,904
2,425,580
-
2,425,580
The Group does not account for any fixed rate financial assets and liabilities at fair value through profit or loss, and the Group
does not designate derivatives (interest rate swaps) as hedging instruments under a fair value hedge accounting model.
Therefore a change in interest rates at the reporting date would not affect profit or loss.
Page 49
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
18. FINANCIAL INSTRUMENTS - continued
The following table summarises interest rate risk for the consolidated entity, together with effective interest rates as at balance
date.
Consolidation
2009
Financial Assets:
Current:
Cash at bank
Receivables
Non current:
Deposit
Total Financial Assets
Financial Liabilities:
Current:
Accounts payable
Total Financial Liabilities
2008
Financial Assets:
Current:
Cash at bank
Receivables
Non current:
Deposit
Total Financial Assets
Financial Liabilities:
Current:
Accounts payable
Total Financial Liabilities
Weighted
average effective
interest rate
Floating interest
rate
Non-interest
bearing
$
$
2.75%
1,514,160
-
-
1,514,160
-
-
-
11,514
99,404
110,918
154,205
154,205
Weighted
average effective
interest rate
Floating interest
rate
Non-interest
bearing
$
$
6.45%
2,428,436
-
-
2,428,436
-
-
-
11,794
83,203
94,997
41,098
41,098
Total
$
1,514,160
11,514
99,404
1,625,078
154,205
154,205
Total
$
2,428,436
11,794
83,203
2,523,433
41,098
41,098
Page 50
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
18. FINANCIAL INSTRUMENTS - continued
Company
2009
Financial Assets:
Current:
Cash at bank
Receivables
Total Financial Assets
Financial Liabilities:
Current:
Accounts payable
Total Financial Liabilities
2008
Financial Assets:
Current:
Cash at bank
Receivables
Total Financial Assets
Financial Liabilities:
Current:
Accounts payable
Total Financial Liabilities
Weighted
average effective
interest rate
Floating interest
rate
Non-interest
bearing
$
$
2.75%
1,513,904
-
1,513,904
-
-
-
808,284
808,284
153,957
153,957
Weighted
average effective
interest rate
Floating interest
rate
Non-interest
bearing
$
$
6.45%
2,425,580
-
2,425,580
-
-
-
316,611
316,611
41,098
41,098
Total
$
1,513,904
808,284
2,322,188
153,957
153,957
Total
$
2,425,580
316,611
2,742,191
41,098
41,098
Page 51
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
18. FINANCIAL INSTRUMENTS - continued
(iii) Cash flow sensitivity analysis for variable rate instruments
Consolidated
At 30 June 2009, a change in interest rates would only affect variable rate deposits and cash balances resulting in a decrease or
increase in overall income.
A sensitivity of 10% has been selected as this is considered reasonable given the current level of both short term and long term
Australian dollar interest rates. A 10% increase sensitivity would move short term interest rates at 30 June 2009 from around
2.75% to 3.02% (10% decrease: 2.48%) representing a 27 basis points shift.
At 30 June, the effect on loss and equity as a result of changes in interest rates, with all other variables remaining constant is as
follows:
Year ended 30 June 2009
+/-10% in interest rates
Year ended 30 June 2008
+/-10% in interest rates
Consolidated
Profit
$
Equity
$
Company
Profit
$
Equity
$
+/- 4,163
+/- 4,163
+/- 4,163
+/- 4,163
+/- 15,785
+/- 15,785
+/- 15,785
+/- 15,785
The Company does not have any material risk exposure to any single debtor or group of debtors.
(d)
Net fair values
For assets and other liabilities, the net fair value approximates their carrying value. No financial assets and financial liabilities
are readily traded on organised markets in standardised form. The Company has no financial assets where carrying amount
exceeds net fair values at balance date.
The aggregate net fair values and carrying amounts of financial assets and financial liabilities are disclosed in the balance
sheet and in the notes to and forming part of the financial statements.
(e)
Capital Management
Management controls the capital of the Group in order to ensure that the Group can fund its operations on an efficient and
timely basis and continue as a going concern.
There are no externally imposed capital requirements.
Management effectively manages the Group’s capital by assessing the Group’s cash projections up to twelve months in the
future and any associated financial risks. Management will adjust the Group’s capital structure in response to changes in
these risks and in the market.
There have been no changes in the strategy adopted by management to control the capital of the Group since the prior year.
Page 52
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
19. COMMITMENTS
(a) Exploration expenditure commitments
For those mineral concessions where the consolidated entity is not the titleholder, the earning of equity interest is by incurring
exploration expenditure of specified amounts by certain dates. Where the consolidated entity or its joint venture partners are
the concession holder, renewal will be subject to satisfying the relevant authority as to the adequacy of exploration programs
by comparison to work programs submitted at the time of grant of the concession. It is estimated that the consolidated entity is
required to make the following outlays to satisfy joint venture and exploration permit conditions. These commitments are
subject to variation dependent upon matters such as the results of exploration on the mineral concessions.
Within one year
One year or later and not later than five years
Later than five years
20. CONTINGENT LIABILITIES
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
390,758
611,075
-
276,406
1,559,844
-
1,001,833
1,836,250
-
-
-
-
260,000
1,520,000
-
1,780,000
There were no contingent liabilities of the consolidated entity not provided for in the financial statements at 30 June
2009.
21. STATEMENTS OF CASH FLOWS
(a) Reconciliation of the loss to net cash used in
operating activities
Loss after income tax
Add back non-cash items:
Depreciation
Foreign currency loss/(gain)
Non-cash share option expenditure
Gain on sale of property, plant and equipment
Impairment of investment in subsidiary
Exploration costs written-off
Change in assets and liabilities:
Decrease in receivables
Decrease in payables
Notes
Consolidated
Company
2009
$
2008
$
2009
$
2008
$
(1,216,774)
(696,472)
(1,156,031)
(699,943)
26,454
(3,360)
-
(13,018)
-
740,982
25,043
-
88,700
-
-
71,503
26,454
(49,973)
-
(13,018)
530,004
210,978
280
(11,915)
28,292
(23,094)
290
(11,915)
25,043
14,780
88,700
-
-
71,503
276
4,941
Net cash used in operating activities
(477,351)
(506,028)
(463,211)
(494,700)
(b) Non-Cash Financing and Investing Activities
There were no non-cash financing or investing activities during the current year.
Page 53
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
22. DIRECTOR AND EXECUTIVE DISCLOSURES
(a) Details of Key Management Personnel
The following were key management personnel of the consolidated entity at any time during the reporting period and unless
otherwise indicated were key management personnel for the entire period:
Non Executive Directors
Mr Reginald Gillard
Mr Patrick Flint
Mr Gavin Argyle
Mr Anthony Cunningham
Senior Managers
Mr Paul Jurman
Managing Director
Mr Gregory Smith
(b) Loans to key management personnel and their related parties
There were no loans outstanding at the reporting date to key management personnel and their related parties.
(c) Compensation options: Granted and vested during the year (Consolidated)
No options were granted during the current year as compensation benefits to key management personnel.
During the prior financial year options were granted as equity compensation benefits to certain key management personnel. All
options vested at grant date. The options were issued free of charge. Each option entitles the holder to subscribe for one fully
paid share in the entity at an exercise price of 35 cents. The contractual life of each option granted is three years.
30 June 2008
Senior Manager
Vested
Number
Granted
Number
Grant Date
Fair Value
per option at
grant date
$
Exercise price
per option
$
First
Exercise
Date
$
Last Exercise
Date
$
P Jurman
350,000
350,000
07-02-08
58,100
0.35
01-5-08
30-09-10
Total
350,000
350,000
(d) Shares issued on Exercise of Compensation Options (Consolidated)
No shares were issued during the year on exercise of compensation options.
Page 54
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
22. DIRECTOR AND EXECUTIVE DISCLOSURES - continued
(e) Option holdings of Key Management Personnel (Consolidated)
30 June 2009
Directors
R N Gillard
G L Smith
P J Flint
G J Argyle (i)
Balance at
beginning
of period
1,676,103
1,366,976
1,493,603
585,000
A R Cunningham (i)
N/A
Senior managers
P Jurman
30 June 2008
Directors
R N Gillard
G L Smith
P J Flint
G J Argyle
Senior managers
P Jurman
350,000
5,471,682
Balance at
beginning
of period
1,676,103
1,366,976
1,493,603
585,000
Granted as
remuneration
Options
exercised
Net change
Other (i)
Balance at
end of period
Total
Exercisable
Not
Exercisable
Vested as at 30 June 2009
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,676,103
1,676,103
1,676,103
1,366,976
1,366,976
1,366,976
1,493,603
1,493,603
1,493,603
-
-
-
100,000
100,000
100,000
100,000
-
350,000
350,000
350,000
100,000
4,986,682
4,986,682
4,986,682
-
-
-
-
-
-
-
Granted as
remuneration
Options
exercised
Net change
Other
Balance at
end of period
Total
Exercisable
Not
Exercisable
Vested as at 30 June 2008
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,676,103
1,676,103
1,676,103
1,366,976
1,366,976
1,366,976
1,493,603
1,493,603
1,493,603
585,000
585,000
585,000
350,000
350,000
350,000
5,471,682
5,471,682
5,471,682
-
-
-
-
-
-
-
350,000
5,121,682
350,000
(i) Mr Argyle resigned, and Mr Cunningham was appointed, as directors during the year.
Page 55
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
22. DIRECTOR AND EXECUTIVE DISCLOSURES - continued
(f) Number of shares held by Key Management Personnel
30 June 2009
Directors
R N Gillard
G L Smith
P J Flint
G J Argyle (i)
A R Cunningham (i)
Senior managers
P Jurman
Balance
01 July 2008
Granted as
remuneration
On Exercise of
Options
Net Change Other
(i)
Balance
30 June 2009
Ord
Ord
Ord
Ord
Ord
810,541
733,952
517,541
-
N/A
-
2,062,034
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
810,541
733,952
517,541
-
100,000
100,000
-
-
100,000
2,162,034
(i) Mr Argyle resigned, and Mr Cunningham was appointed, as directors during the year.
30 June 2008
Directors
R N Gillard
G L Smith
P J Flint
G J Argyle
Senior managers
P Jurman
Balance
01 July 2007
Granted as
remuneration
On Exercise of
Options
Net Change Other
Balance
30 June 2008
Ord
Ord
Ord
Ord
Ord
810,541
733,952
517,541
-
-
2,062,034
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
810,541
733,952
517,541
-
-
2,062,034
Page 56
Lindian Resources Limited
Notes to the Financial Statements
For the Year ended 30 June 2009
22. DIRECTOR AND EXECUTIVE DISCLOSURES (continued)
(g) Other transactions with Key Management Personnel and their related parties
A number of key management persons, or their related parties, hold positions in other entities that result in them having
control or significant influence over the financial or operating policies of those entities. These are listed below:
Corporate Consultants Pty Ltd (“CCPL”) provides accounting, administrative and company secretarial services on commercial
terms. Total amounts paid to CCPL were $54,622 (2008: 24,870) during the reporting period. Mr Gillard and Mr Flint are
directors of and have a beneficial interest in CCPL.
Ledgar Road Partnership charges rent at commercial rates, totalling $2,934 (2008: 4,370) for the period. Mr Gillard has a
beneficial interest in the Ledgar Road Partnership.
In the prior year, Corporate & Resource Consultants Pty Ltd (“CRCPL”) received 5,000,000 shares at 10.5 cents during the
financial year in consideration for the purchase of Coexco Sprl. The options were valued based on the Black & Scholes pricing
model. Mr Gillard and Mr Flint are directors of and have a beneficial interest in (but do not control) CRCPL.
All transactions above were completed at arms length.
Apart from the details disclosed in this note, no Director has entered into a material contract with the Company or the
consolidated entity since the end of the previous financial year and there were no material contracts involving Directors’
interests subsisting at year-end.
(h) Transactions with Related Parties - Subsidiaries
Wholly Owned Consolidated Entity
The Company incurs exploration expenditure on behalf of the subsidiaries. Investments in and loans to wholly owned
subsidiaries are disclosed in Notes 10 and 9 respectively.
Transactions between related parties are on normal commercial terms and conditions unless otherwise stated.
23. EVENTS OCCURRING AFTER THE REPORTING DATE
In June 2009 the Company issued a prospectus pursuant to a fully underwritten, pro-rata (on the basis of one option for every
three shares held) non-renounceable entitlement issue of options (at a price of one cent each. The issue closed on 24 July 2009
and 12,609,341 options were allotted and dispatched on 4 August 2009.
In September 2009 the Company was granted a second exploration permit covering 311km2 at the Dinguiraye Pt-Ni-Cu
Project located in Guinea, West Africa.
No other matters or circumstances have arisen since the end of the financial year which have significantly affected or may
significantly affect the operations, results or state of affairs of the Company in subsequent financial years.
Page 57
Lindian Resources Limited
Directors’ Declaration
30 June 2009
In the opinion of the Directors of Lindian Resources Limited ("the Company"):
(a) The financial statements and the notes and the additional disclosures included in the directors’ report designated
as audited of the Company and of the consolidated entity are in accordance with the Corporations Act 2001,
including:
(i)
Giving a true and fair view of the Company’s and consolidated entity’s financial position as at 30
June 2009 and of their performance for the period ended that date; and
(ii)
Complying with Accounting Standards and Corporations Regulations 2001; and
b) There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
c) This declaration has been made after receiving the declarations required to be made to the directors in
accordance with section 295A of the Corporations Act 2001 for the financial period ended 30 June 2009.
Signed in accordance with a resolution of the Directors made pursuant to section 295(5) of the Corporations Act
2001.
On behalf of the Directors
G Smith
Managing Director
Dated at Perth, 29 September 2009
Page 58
8 St Georges 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
LINDIAN RESOURCES LIMITED
Report on the Financial Report
We have audited the accompanying financial report of Lindian Resources Limited (“the company”), which
comprises the balance sheet as at 30 June 2009, and the income statement, statement of changes in equity and
cash flow statement for the year ended on that date, a summary of significant accounting policies, other
explanatory notes 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 and fair presentation of the financial report in
accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the
Corporations Act 2001. This responsibility includes establishing and maintaining internal control relevant to the
preparation and fair presentation of the financial report that is free from material misstatement, whether due to
fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are
reasonable in the circumstances. In Note 1, the directors also state, in accordance with Accounting Standard
AASB 101 Presentation of Financial Statements, that compliance with the Australian equivalents to
International Financial Reporting Standards ensures that the financial report, comprising the financial statements
and notes, complies 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 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
opinions.
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 an
independent member firm of RSM
International, an affiliation of independent
accounting and consulting firms.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.
Auditor’s Opinion
In our opinion:
(a) the financial report of Lindian Resources Limited is in accordance with the Corporations Act 2001,
including:
(i) giving a true and fair view of the company's and consolidated entity’s financial position as at 30 June
2009 and of their performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations)
and the Corporations Regulations 2001; and
(b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 1.
Report on the Remuneration Report
We have audited the Remuneration Report contained in the directors’ report for the financial year ended 30 June
2009. 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.
Auditor’s Opinion
In our opinion the Remuneration Report of Lindian Resources Limited for the financial year ended 30 June 2009
complies with section 300A of the Corporations Act 2001.
RSM BIRD CAMERON PARTNERS
Chartered Accountants
Perth, WA
Dated: 29 September 2009
T PHONG
Partner
Lindian Resources Limited
Mineral Concession Interests
TENEMENT DIRECTORY
Mineral tenements held at 17 September 2009 are as follows:
Project
Tenement Reference
Company Interest %
Status / Comment
Dinguiraye Iron and PGE /
base metal project in Guinea,
Africa.
A 2009/017/DIGM/CPDM
Exploration Licence (“EL”)
A 2009/138/DIGM/CPDM
Exploration Licence (“EL”)
92%
Granted 18/3/2009
92%
Granted 11/9/2009
Bafwasende
Diamond Project
Gold
and
Notes
PR6013 – PR6016
PR6018 – PR6036
PR6887 – PR6896
PR6897
PR6898 – PR6906
PR6909
80%
80%
80%
80%
80%
80%
Granted 30/1/2007
Granted 30/1/2007
Granted 19/6/2007
Pending
Granted 19/6/2007
Granted 19/6/2007
1. The governments of African countries in which the Company holds minerals interests are entitled to equity
in mining companies owning projects as follows – Guinea 15% and Democratic Republic of Congo 5%.
Lindian's quoted equity is before allowance for that national interest, which occurs when a new project
company is established prior to commencement of mining.
2. The granting of both Exploration Licences was facilitated in Guinea by Adem sarl (“Adem”) and Corporate
& Resources Consultants Pty Ltd (“CRCPL”). Adem received a cash payment of US$40,000 following the
granting of both licences, and Adem will receive a cash payment of US$15,000 on 11 September 2010 and
Adem and CRC will each receive a cash payment of US$35,000 on 18 March 2011 (provided the Company
continues to hold the licence).
Adem and CRC also each have a 4% interest in this exploration licence, carried to production. The Company
has the right (but not the obligation) to buy half (2%) of each parties interest upon completion of a feasibility
study by payment to each party of US$1.5 million (comprising US$1 million in cash and US$0.5 million in
shares).
Page 61
Lindian Resources Limited
Additional Shareholder Information
The shareholder information set out below was applicable as at 17 September 2009.
Distribution of Holders of Equity Securities
Size of
Holding
Ordinary
Shares
Options
(LINO)
Options
(LINOA)
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
487
504
153
209
45
1,398
86
161
28
102
33
410
63
61
22
57
27
230
The number of shareholdings comprising less than a marketable parcel was 662.
Voting Rights
The voting rights attaching to ordinary shares are governed by the Constitution. On a show of hands every person
present who is a member or representative of a member shall have one vote and on a poll, every member present in
person or by proxy or by attorney or duly authorised representative shall have one vote for each share held. None
of the options has any voting rights.
Twenty Largest Shareholders as at 17 September 2009
ANZ Nominees Limited
Corporate & Resource Consultants Pty Ltd
Mr Michael Robert Franco + Mr Robert Mario Franco + Miss Laura Michelle
Franco
Mikado Corporation Pty Ltd
Eagle River Holdings Pty Ltd
Shah Nominees Pty Ltd
Nefco Nominees Pty Ltd
Stevsand Investments Pty Ltd
Crestline Investments Pty Ltd
Manikato Financial Services Pty Ltd
Mr Alfonso Di Lanzo
Mr John Francis Corr
Dr Todd Andrew Silbert
Mr David Argyle
National Nominees Limited
Masters Sprl
Mr Thomas Francis Corr
Mr Ianaki Semerdziev
Mr Brian Joseph Glynn
Newmek Investments Pty Ltd
Number of
Shares
7,271,465
4,557,292
% Held
19.22
12.05
1,500,000
1,126,828
900,000
800,000
700,000
660,000
600,952
581,640
566,000
500,000
500,000
417,411
416,000
400,000
400,000
365,712
358,000
353,666
3.97
2.98
2.38
2.11
1.85
1.74
1.59
1.54
1.50
1.32
1.32
1.10
1.10
1.06
1.06
0.97
0.95
0.93
22,974,966
60.74
Page 62
Lindian Resources Limited
Additional Shareholder Information
Twenty Largest Optionholders as at 17 September 2009
Options Expiring 31 December 2009 (ASX code: LINO)
ANZ Nominees Limited
Mr Michael Robert Franco + Mr Robert Mario Franco + Miss Laura Michelle
Franco
Mr Nathan Vadala
Clodene Pty Ltd
Corporate & Resource Consultants Pty Ltd
Mr David Brian Argyle & Mrs Elizabeth Anne Argyle
Elawena Nominees Pty Ltd
Nefco Nominees Pty Ltd
Crestline Investments Pty Ltd
Manikato Financial Services Pty Ltd
Mr Michael John Fennell
Mr Gavin John Argyle
Mr Thomas Francis Corr
Ms Pao-Yu Chou
Dr Georg Schnura
Masters Sprl
Mr Robert Vadala + Mrs Suzanne Vadala
Mr Michael Joseph Demarte
Comsec Nominees Pty Ltd
Mr David Leone
Twenty Largest Optionholders as at 17 September 2009
Options Expiring 31 December 2011 (ASX code: LINOA)
Cunningham Securities Pty Ltd
Corporate & Resource Consultants Pty Ltd
ANZ Nominees Limited
Mr Gregory Lowell Smith
Mr Patrick Flint
Mr Michael Robert Franco + Mr Robert Mario Franco + Miss Laura Michelle
Franco
Amalgamation Sale and Takeover Consultants Pty Ltd < Super Fund A/C>
Amalgamation Sale and Takeover Consultants Pty Ltd < RN & MK Gillard A/C>
Eagle River Holdings Pty Ltd
Albatross Pass Pty Ltd
Mr Paul Gabriel Sharbarnee < The Scorpion Fund A/c >
Shah Nominees Pty Ltd
Axino AG
Stevsand Investments Pty Ltd
Crestline Investments Pty Ltd
Mikado Corporation Pty Ltd
Manikato Financial Services Pty Ltd
Mr Alfonso Di Lanzo
Ms Sarah Emily Jane Peters
Mr John Francis Corr
Number of
Options
% Held
4,038,044
23.23
750,000
678,358
636,509
625,000
542,428
491,250
350,000
300,476
290,820
263,000
255,000
250,000
234,321
220,000
200,000
198,000
180,000
177,000
173,500
4.31
3.90
3.66
3.60
3.12
2.83
2.01
1.73
1.67
1.51
1.47
1.44
1.35
1.27
1.15
1.14
1.04
1.02
1.00
10,853,706
62.45
Number of
Options
2,000,000
1,519,098
868,324
799,325
502,334
% Held
15.86
12.05
6.89
6.34
3.98
500,000
315,000
300,000
300,000
278,250
278,250
266,667
250,000
220,000
200,318
196,834
193,880
188,667
183,334
166,667
3.97
2.50
2.38
2.38
2.21
2.21
2.11
1.98
1.74
1.59
1.56
1.54
1.50
1.45
1.32
9,526,948
75.56
Page 63
Lindian Resources Limited
Additional Shareholder Information
Unquoted Options
Unquoted options on issue at 17 September 2009 were as follows:
Refer
Note
1
2
3
4
5
Number of
Options
495,000
1,000,000
200,000
350,000
500,000
Exercise Price
Exercise Periods/ Expiry Dates
20 cents
20 cents
30 cents
35 cents
30 cents
On or before 31 December 2010
On or before 1 July 2011
On or before 30 September 2010
On or before 30 September 2010
On or before 31 December 2011
Number of
Holders
4
1
1
1
1
The names of the holders of 20% or more options in these unquoted securities are listed below:
Note
Name
Number of Options Held % of Options Held
1
2
3
4
5
Gavin Argyle
Corporate & Resource Consultants Pty Ltd
Guy Scherrer
Paul Jurman
John V Hamilton
330,000
1,000,000
200,000
350,000
500,000
66.67
100
100
100
100
Page 64